14.2 Terms/Rights Attached to Shares

The company has only one class of equity shares having a par value of Rs. 10/- per share. Each share holder of fully paid equity shares is entitled to one vote per share. The company declares and pays dividends to the share holders of fully paid equity shares in Indian rupees. The dividend proposed by Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

NATURE AND PURPOSE OF EACH RESERVE

Security Premium Reserve - Security premium reserve is used to record the premium on issue of shares. This reserve is utilised in accordance with the provision of the Companies Act 2013.

Capital Reserve - This reserve was created in the financial year 2015-16. Capital reserves are created out of forfeiture of shares and are usually utilised for issue of Bonus shares.

Capital Subsidy Reserve - This reserve was created in financial year 1994-95 of ' 6.37 Lakhs & in financial year 2004-05 of ' 16.41 Lakhs and created out of capital subsidy received by the company.

The reserve is to be usually created for use of Bonus shares or to adjust capital losses.

General Reserve - General Reserve is a free reserve and is available for distribution as dividend, issue of bonus shares, buyback of the companies securities. It was created by transfer of amounts out of distributable profits, from time to time.

(c) Working capital referred to above from Banks are secured by way of Hypothecation of first & exclusive charge on all present & future current assets inclusive of all stocks & book debts and plant & machinery along with equitable mortgage on the property situated at Plot no. 41, Survey no. 35 (PT) Diwan & sons industrial Estate, Aliyali Village, Palghar, Thane District & Survey no. 202/2, Old check post, Dadra & Nagar Haveli, Dadra

16.2 The term loan have been sanctioned for the purpose of purchase / import of Plant & Machinery and the same has been fully used in accordance with the stated purpose.

NOTE 35: Contingent Liabilities and Litigations

a) Unredeemed Bank Guarantees & Letter of credit are Rs. 32.64 Lakhs (P.Y. Rs. 38.18 Lakhs)

b) Claims against the company not acknowledged as debts pending outcome of appeals / rectification -Ý Income Tax Liability Rs.1.27 Lakhs (P.Y. Rs. 0.74 Lakhs)

c) The company has filed legal suit against debtors towards recovery of Rs. 4.28 Lakhs and the provision for impairment / doubtful debts has been made for the same. The final realization is subject to outcome of the legal case.

NOTE 36-A:

Capital Commitments:- Estimate amount of contract remaining to be executed on Capital Account & not provided for Rs NIL (P.Y. Rs 24.57 Lakhs) against which advance has been paid of Rs. NIL (P.Y. Rs. 15.13 Lakhs)

NOTE 37: Balance Confirmation

The balance confirmations in respect of debtors, creditors, advances, loans and deposits as at 31st March 2026 have been called for and are subject to confirmation & reconciliation as the necessary communication in this respect is not received from them. The management has scrutinized the accounts and the balances appearing in the Balance Sheet are correct.

In the opinion of the management, no item of current assets, loans and advances has a value on realization in the ordinary course of business, which is less than the amount of value at which it is stated in the Balance Sheet, unless otherwise specified.

b) Defined benefit plans - Gratuity & Leave Encashment:

Gratuity: - The Company operates a gratuity plan which is administrated through HDFC Standard Life Insurance Company Limited and a trust which is administrated through trustees. Every employee is entitled to a minimum benefit equivalent to 15 days salary last drawn for each completed year of service in line with Payment of Gratuity act, 1972. The same is payable at the time of separation from the company or retirement, whichever is earlier or death in service.

Leave Encashment: - The employees are entitled to accumulate compensated absence upto specified days as per company policy, which is payable at the time of separation from company i.e. retirement or death in service at the rate of last drawn basic salary, which was previously on last drawn gross salary of FY 2024-25.

The details on Company’s Gratuity and Leave Encashment liabilities employees are given below which is certified by the actuary and relied upon by the auditors.

On 21st November 2025, the Government of India notified the four Labour Codes - the Code on Wages, 2019, the Industrial Relations Code, 2020, the Code on Social Security, 2020, and the Occupational Safety, Health and Working Conditions Code, 2020 - consolidating 29 existing labour laws. The Ministry of Labour & Employment published draft Central Rules and FAQs to enable assessment of the financial impact due to changes in regulations. Further subsequent to this the Company has changed the leave encashment entitlement policy at the rate of last drawn basic salary vis-a-vis last drawn gross salary until FY 2024-25.

The Company has assessed and disclosed the incremental impact of these changes on the basis of actuarial valuation report. This has resulted in net increase of Rs. 39,01,822 lakhs in Employee Benefits expense for the year ended 31st March 2026.

The incremental impact primarily arises due to change in wage definition. The Company continues to monitor the finalisation of Central / State Rules and clarifications from the Government on other aspects of the Labour Code and would provide appropriate accounting effect on the basis of such developments as needed.

NOTE 41:

A) Segment Reporting: (Rs. in Lakhs)

I n the opinion of the management the company is mainly engaged in the business of manufacturing of Elastic and all other activities of the Company including supply of raw materials to subsidiary of Rs. 355.93 Lakhs ( P.Y. Rs. 313.13 Lakhs) revolve around the main business, and as such, there are no separate reportable segments.

Adoption of Ind AS 116 - Leases

(a) Effective 1st April 2019, the Company has adopted Ind AS 116 - Leases using a modified retrospective approach. Accordingly, on initial application of Ind AS 116, in respect of leases previously classified as operating leases, lease liability is measured at the present value of remaining lease payments discounted using the incremental borrowing rate at the date of initial application and the Right-of-use asset has been measured at the amount equal to lease liability, adjusted for any prepaid or accrued lease payments recognised in the balance sheet immediately before the date of initial application.

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity and derivative instruments that have quoted price. The fair value of all equity instruments which are traded in the stock exchanges is valued using the closing price as at the reporting period.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximize the use of observable market data and rely as little as possible on entity specific estimates. The Company has mutual funds for which all significant inputs required to fair value an instrument falls under level 2.

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is the case for unlisted equity securities and unlisted preference shares are included in level 3.

There are no transfers between levels 1,2 and 3 during the year.

(ii) Valuation technique used to determine fair value

Specific valuation techniques used to value financial instruments include:

I nvestments in quoted equity instruments are valued using the closing price at Bombay Stock Exchange (BSE) at the reporting period.

The fair value of forward foreign exchange contracts is determined using forward exchange rates as at the balance sheet date, prevailing with authorised dealers dealing in foreign exchange.

The use of Net Assets Value (‘NAV) for valuation of mutual fund investment. NAV represents the price at which the issuer will issue further units and will redeem such units of mutual fund to and from the investors.

The fair value of the debentures is determined based on present values and the discount rates used were adjusted for counterparty risk and country risk.

(a) The carrying amounts of trade receivables, trade payables, cash and cash equivalents, bank balances other than cash and cash equivalents, borrowings and other financial liabilities are considered to be the same as their fair values, due to their short term nature.

(b) The fair values and carrying value for equity investments, security deposits, loans, other financial assets and other financial liabilities are materially the same.

NOTE 47A: Financial risk management

The Company’s activities expose it to market risk, liquidity risk and credit risk. In order to minimize any adverse effects on the financial performance of the company, derivative financial instruments, such as foreign exchange forward contracts are entered to hedge certain foreign currency risk exposures. Derivatives are used exclusively for hedging purposes and not as trading or speculative instruments.

This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the impact of hedge accounting in the financial statements.

The company has a robust risk management framework comprising risk governance structure and defend risk management processes. The risk governance structure of the company is a formal organization structure with defend roles and responsibilities for risk management.

The Company risk management is carried out by a central treasury department under the guidance from the board of directors. Company’s treasury identifies, evaluates and hedges financial risks in close coordination with the company’s operating units. The board provides written principles for overall risk management, as well as policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, use of derivative financial instruments and non-derivative financial instruments, and investment of excess liquidity. There is no change in objectives and process for managing the risk and methods used to measure the risk as compared to previous year.

Credit risk is the risk that the counterparty will not meet its obligation under a financial instrument or customer contract, leading to financial loss. The Credit risk mainly arises receivables from customers, cash and cash equivalents, loans and deposits with banks, financial institutions & others.

a) Trade receivables and loans

The maximum exposure to the credit risk at the reporting date is primarily from trade receivables amounting to Rs. 696.80 Lakhs as at March 31,2026 (March 31,2025 Rs. 913.22 Lakhs) and from loans amounting Rs. 11.64 Lakhs (March 31, 2025 Rs. 13.14 Lakhs) Trade receivables are typically unsecured and are derived from revenue earned from customers located in India as well as outside India.

The Company establishes an allowance for doubtful debts and impairment that represents its estimate of incurred losses in respect of trade receivables.

The Company‘s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The demographics of the customer, including the default risk of the industry, the country and the state in which the customer operates, also has an influence on credit risk assessment.

Credit risk is managed through credit approvals, establishing credit limits and continuously monitoring the credit worthiness of customers to which the Company grants credit terms in the normal course of business.

The management continuously monitors the credit exposure towards the customers outstanding at the end of each reporting period to determine incurred and expected credit losses. Historical trends of impairment of trade receivables do not reflect any significant credit losses. Given that the macroeconomic indicators affecting customers of the Company have not undergone any substantial change, the Company expects the historical trend of minimal credit losses to continue.

The average credit period on sales of products is less than 90 days. Credit risk arising from trade receivables is managed in accordance with the Company‘s established policy, procedures and control relating to customer credit risk management. Credit quality of a customer is assessed based on a detailed study of credit worthiness and accordingly individual credit limits are defined/modified. For trade receivables, as a practical expedient, the Company computes credit loss allowance based on a provision table as above.

b) Cash and cash equivalents:

As at the year end, the Company held cash and cash equivalents of Rs. 978.17 Lakhs ( March 31, 2025: Rs. 365.44 Lakhs). The cash and cash equivalents are held with bank and financial institution counterparties with good credit rating.

c) Other Bank Balances:

Other bank balances are held with bank and financial institution counterparties with good credit rating.

d) Loans : The maximum exposure from loans is from loans due to employees and the repayments are regular and neither past due nor impaired.

e) Other financial assets:

Other financial assets includes security deposits which are neither past due nor impaired.

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Due to the dynamic nature of the underlying businesses.

Company treasury maintains flexibility in funding by maintaining availability under committed credit lines. Management monitors rolling forecasts of the Company‘s liquidity position (comprising the undrawn borrowing facilities below) and cash and cash equivalents on the basis of expected cash flows.

3) Market Risk :

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risks namely interest rate risk, currency risk and other price risk, such as commodity risk. The Company is not exposed to interest rate risk whereas the exposure to currency risk and other price risk is given below:

A) Market Risk- Foreign currency risk.

The Company operates internationally and portion of the business is transacted in several currencies and consequently the Company is exposed to foreign exchange risk through its sales in overseas and purchases from overseas suppliers in various foreign currencies. Foreign currency exchange rate exposure is partly balanced by maintaining an EEFC bank account and purchasing of goods, commodities and services in the respective currencies. The Company also uses foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments, highly probable forecast transactions and foreign currency required at the settlement date of certain receivables/payables. The use of foreign currency forward contracts is governed by the Company‘s strategy approved by the board of directors, which provide principles on the use of such forward contracts consistent with the Company‘s risk management policy and procedures.

B) Market Risk- Price risk.

(a) Exposure

The company is mainly exposed to the price risk due to its investment in mutual funds and investment in equity instruments held by the company and classified in the balance sheet as fair value through profit or loss. The investment in mutual funds are mix of equity and debt based mutual funds. The price risk arises due to uncertainties about the future market values of these investments. To manage its price risk arising from investments in equity securities and mutual funds, the company diversifies its portfolio.

Additional Regulatory information.

NOTE 49:

The disclosure requirements about any transactions not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act 1961 ( such as search or surveyor any other relevant provision of Income Tax Act 1961 ) is not applicable to the company.

NOTE 50:

The company has not traded or invested in crypto currency or virtual currency during the financial year.

NOTE 51 :

There are no proceedings which are initiated or pending against the Company for holding any Benami property under the Benami transactions (Prohibition) Act 1988 & rules made thereunder.

NOTE 52:

The Company does not have any transactions with companies struck off under section 248 of the Companies Act, 2013 or section 560 of the Companies Act, 1956.

Note 53 :

Utilisation of Borrowed funds and share premium

The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

a. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (Ultimate Beneficiaries) or

b. provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries

The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

a. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or

b. provide any guarantee, security or the like on behalf of the ultimate beneficiaries Note 54 :

No significant subsequent events have been observed which may require an adjustment to the financial statements.

Note 55 :

The Company has used accounting software for maintaining its books of accounts which has a feature of recording audit trail (edit log) facility and the same has been operated throughout the year for all relevant transactions recorded in the software. Further, there are no instance of audit trail feature being tampered during the year.

NOTE 57: Figures of Previous are regrouped and reclassified wherever necessary.