1.11 Provisions, Contingent Liabilities and Contingent Assets:

a Provisions are recognised when the Company has present obligation (legal or constructive) as a result
of past events, for which it is probable that an outflow of resources embodying economic benefits will
be required to settle the obligation and a reliable estimate can be made for the amount of the
obligation. Contingent Liabilities are disclosed by way of notes to Financial Statements. Contingent
assets are not recognised in the financial statements. Provisions and contingent liabilities are
reviewed at each Balance Sheet date.

b If the effect of the time value of money is material, provisions are discounted using a current pre-tax
rate that reflects, when appropriate, the risks specific to the liability.

1.12 Employee benefits

Short term employee benefits like salaries are provided on accrual basis. The provident fund, Employee
state insurance and Gratuity are not applicable to the company.

1.13 Financial instruments
Financial Assets

Initial Recognition and Measurement:

The Company recognizes a financial asset in its balance sheet when it becomes party to the contractual
provisions of the instrument. All financial assets are recognized initially at fair value, plus in the case of
financial assets not recorded at fair value through profit or loss (FVTPL), transaction cost that are
attributable to the acquisition of the financial asset.

Where the fair value of a financial asset at initial recognition is different from its transaction price, the
difference between the fair value and the transaction price is recognized as a gain or loss in the Statement
of Profit and Loss at initial recognition if the fair value is determined through a quoted market price in an
active market for an identical asset (i.e. level 1 input) or through a valuation technique that users data from
observable markets.

In case the fair value in not determined using a level 1 inputs as mentioned above, the difference between
the fair value and transaction price is deferred appropriately and recognized as a gain in the Statement of
Profit and Loss only to the extent the such gain or loss arises due to a change in factor that market
participants take into account when pricing the financial asset.

However trade receivables that do not contain a significant financing component are measured at
transaction price.

Investments and other financial assets
(I) Classification

The Company classifies its financial assets in the following measurement categories:

1 those to be measured subsequently at fair value (either through other comprehensive income, or
through the Statement of Profit and Loss), and

2 those measured at amortised cost.

The classification depends on the Company’s business model for managing the financial assets
and the contractual terms of the cash flows.

(ii) Measurement

At initial recognition, the Company measures a financial asset at its fair value, plus in the case of
financial assets not recorded at fair value through the other comprehensive income, transaction costs
that are attributable to the acquisition of the financial assets

Debt instruments :

Subsequent measurement of debt instruments depends on the Company’s business model for
managing the asset and the cash flow characteristics of the asset. The Company classifies its debt
instruments into following categories:

(1) Amortised cost:

Assets that are held for collection of contractual cash flows where those cash flows represent solely
payments of principal and interest are measured at amortised cost. Interest income from these
financial assets is included in other income using the effective interest rate method.

(2) Fair value through other comprehensive Income:

Assets that do not meet the criteria for amortised cost are measured at fair value through Other
Comprehensive Income. Interest income from these financial assets is included in other income.

Equity instruments :

The Company measures its equity investment (other than investment in subsidiaries, joint ventures
and associates) at fair value through Other Comprehensive Income. However where the Company’s
management makes an irrevocable choice on initial recognition to present fair value gains and losses
on specific equity investments in other comprehensive income (currently no such choice made), there
is no subsequent reclassification of fair value gains and losses to the Statement of Profit and Loss.
The Company transfers accumulated Gain/(Loss) (net of tax), from other comprehensive income to
retained earnings at the time of derecognition of the said investment.

Impairment of Financial Assets

The Company recognizes loss allowances using the expected credit loss (ECL) model for the financial
assets which are not fair valued through profit or loss.For trade receivables and contract assets, the
Company applies a simplified approach in calculating ECLs. Therefore, the Company does not track
changes in credit risk, but instead recognises a loss allowance based on lifetime ECLs at each
reporting date. The Company has established a provision matrix that is based on its historical credit
loss experience, adjusted for forward-looking factors specific to the debtors and the economic
environment.

For all other financial assets, ECLs are measured at an amount equal to the 12-month ECL, unless
there has been a significant increase in credit risk from initial recognition in which case those are
measured at lifetime ECL. The amount of ECL (or reversal) that is required to adjust the loss allowance
at the reporting date to the amount that is required to be recognized is recognized as an impairment
loss in the Statement of Profit and Loss.

Derecognition

A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial
assets) is derecognized (i.e. removed from the company’s balance sheet) when any of the following
occurs:

i. The contractual rights to cash flows from the financial asset expires;

ii. The Company transfers its contractual rights to received cash flows of the financial assets and has
substantially transferred all the risk and rewards of ownership of the financial assets;

iii. The Company retains the contractual rights to receive cash flows but assumes a contractual
obligations to pay the cash flows without material delay to one or more recipients under a ‘pass¬
through’ arrangement (thereby substantially transferring all the risks and rewards of ownership of the
financial asset);

iv. The Company neither transfers nor retains substantially all risk and rewards of ownership and does
not retain control over the financial asset.

In cases where Company has neither transferred nor retained substantially all of the risks and rewards
of the financial asset, but retains control of the financial assets, the Company continues to recognize
such financial asset to the extent of its continuing involvement in the financial asset. In that case, the
Company also recognizes an associated liability. The financial asset and the associated liability are
measured on a basis that reflects the rights and obligations that the Company has retained.

On De-recognition of a financial asset (except as mentioned in ii above for financial assets measured
a FVTOCI), the difference between the carrying amount and the consideration received is recognized
in the Statement of Profit and Loss.

Financial liabilities :

Initial recognition and measurement

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit
or loss, loans and borrowings, payables, or as derivatives designated as hedging instruments in an
effective hedge, as appropriate.

All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and
payables, net of directly attributable transaction costs.

The Company’s financial liabilities include trade and other payables, loans and borrowings including
bank overdrafts, financial guarantee contracts and derivative financial instruments.

Subsequent measurement

The Company’s financial liabilities include trade and other payables. It is subsequently measured at
Amortised Cost.

1.14 Cash and cash equivalents

Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and short-term
deposits with an original maturity of three months or less, which are subject to an insignificant risk of
changes in value. For the purpose of the statement of cash flows, cash and cash equivalents consist of
cash and short-term deposits, as defined above, net of outstanding bank overdrafts as they are
considered an integral part of the Company’s cash management.

1.15 Cash flow statement

Statement of Cash Flows is prepared segregating the cash flows into operating, investing and financing
activities. Cash flow from operating activities is reported using indirect method adjusting the net profit for
the effects of:

i. changes during the period in inventories and operating receivables and payables, transactions of a
non-cash nature;

ii. non-cash items such as depreciation, provisions, and unrealised foreign currency gains and losses
etc.; and

iii. all other items for which the cash effects are investing or financing cash flows

1.16 Recent Accounting Pronouncements

The Ministry of Corporate Affairs (“MCA”) notifies new standards or amendments to the existing
standards under Companies (Indian Accounting Standards) Rules as issued from time to time. During the
year ended on March 31,2025, MCA has notified Ind AS 117 - Insurance Contracts and amendments to
Ind AS 116 - Leases, relating to sale and leaseback transactions, effective from April 1, 2024. The
Company has assessed these amendments and determined that they do not have any significant impact
on its financial statements.

On May 07, 2025, MCA notified the amendment in Ind AS 21-The Effects of Changes in Foreign
Exchange Rates. These amendments aim to provide guidance on assessing whether a currency is
exchangeable and on estimating the spot exchange rate when exchangeability is lacking. The
amendments are effective from annual periods beginning on or after April 1, 2025. The Company is
currently assessing the probable impact of these amendments on its financial statement.

21 Fair Value Measurement

Financial Instrument by category and hierarchy:

The fair value of the financial assets and liabilities are included at the amount of which the instrument could be

exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

The following methods and assumptions were used to estimate the fair values:

1. Fair Value of Cash and short term deposits, trade and other short term receivables, trade payables, other
current liabilities, short term loans from banks and other financial institutions approximate their carrying
amount largely due to short term maturities of these instruments.

2. Financial instruments with fixed and variable interest rate are evaluated by the company based on
parameters such as interest rates and individual credit worthiness of the counter party. Based on this
evaluation, allowances are taken to account for expected losses of these receivables. Accordingly, fair
values of such instruments is not materially different from their carrying amounts.

22 Capital risk Management

Equity Share capital and other equity are considered for the purpose of company’s capital management.

The Company manages its capital so as to safeguard its ability to continue as a going concern and to optimise
returns to shareholders. The Capital structure of the company is based on management’s judgment of its
strategic and day-to-day needs with a focus on total equity to maintain investor, creditors and market
confidence and to sustain future development and growth of its business.

The management and the Board of Directors monitors the return on capital as well as the level of dividends to
shareholders. The company may take appropriate steps in order to maintain, or if necessary adjust, its capital
structure.

23 Financial risk management

The Company’s business activities are exposed to a variety of financial risks, namely liquidity risk, market risks
and credit risks. The company’s senior management has the overall responsibility for establishing and
governing the company’s risk management framework. The company has constituted a Risk management
committee, which is responsible for developing and monitoring the company’s risk management policies. The
company’s risk management policies are established to identify and analyse the risks faced by the company,
to set and monitor appropriate risk limits and controls, periodically review the changes in market conditions
and reflect the changes in the policy accordingly. The key risks and mitigating actions are also placed before
the Audit Committee of the company.

A. Management of Liquidity Risk

Liquidity risk is the risk that the company will face in meeting its obligation associated with its financial liabilities.
The Company’s approach in managing liquidity is to ensure that it will have sufficient funds to meet its liabilities
when due without incurring unacceptable losses. In doing this management considers both normal and

stressed conditions.

Due to dynamic nature of the underlying businesses, company treasury maintains flexibility in funding by
maintaining availability of under committed credit lines. Management monitors rolling forecasts of the
company’s liquidity position (comprising the undrawn borrowing facilities) and cash and cash equivalents on
the basis of expected cash flows.

The following table shows the maturity analysis of the company’s financial liabilities based on the contractually
agreed undiscounted cash flows along with its carrying value as at the Balance sheet date.

B. Management of Market Risk

The company’s size and operations result in it being exposed to the following market risks that arise from
its use of financial instruments:

• Equity Price risk

The above risks may affect the company’s income and expenses, or the value of its financial instruments.
The company’s exposure to and management of these risks are explained below:

Equity Price Risk

The Company’s exposure to equity securities price risk arises from investments held by the Company and
classified in the balance sheet at fair value through other comprehensive income. To manage its price risk
arising from investments in equity securities, the Company diversifies its portfolio. Diversification of the
portfolio is done in accordance with the limits set by the Company.

Sensitivity Analysis:

The table below summarizes the impact of increases/decreases of the BSE index on the Company’s equity
and Gain/Loss for the period. The analysis is based on the assumption that the index has increased by 5 %
or decreased by 5 % with all other variables held constant, and that all the Company’s equity instruments
moved in line with the index.

The above referred sensitivity pertains to quoted equity investments. Total Comprehensive Income for the
year would increase/decrease as a result of gains/losses on equity securities as at Fair Value through
Other Comprehensive Income (FVTOCI).

C Management of Credit Risk

Credit risk arises from the possibility that the counter party may not be able to settle their obligations as
agreed. To manage this, the Company periodically assesses financial reliability of customers, taking into
account the financial condition, current economic trends, and analysis of historical bad debts and ageing of
accounts receivable. Individual risk limits are set accordingly.

The company considers the probability of default upon initial recognition of asset and whether there has
been a significant increase in credit risk on an on-going basis through out each reporting period. To assess
whether there is a significant increase in credit risk, the company compares the risk of default occurring on
asset as at the reporting date with the risk of default as at the date of initial recognition. It considers
reasonable and supportive forwarding-looking information such as:

i) Actual or expected significant adverse changes in business,

ii) Actual or expected significant changes in the operating results of the counterparty,

iii) Financial or economic conditions that are expected to cause a significant change to the counterparty’s
ability to meet its obligations,

iv) Significant increase in credit risk on other financial instruments of the same counterparty,

v) Significant changes in the value of the collateral supporting the obligation or in the quality of the third-
party guarantees or credit enhancements.

The Company measures the expected credit loss of trade receivables and loan from individual customers
based on historical trend, industry practices and the business environment in which the entity operates.
Loss rates are based on actual credit loss experience and past trends. Based on the historical data, loss on
collection of receivable is not material hence no additional provision considered.

Concentration of credit risk form part of credit risk

In financial year ending March 2025, considering that the company sells all of its goods to Jindal Worldwide
Limited Artex, the company is wholly dependent on this single customer. Out of total income, Company
earns 69.25% from this single customer.

In financial year ending March 2024, considering that the company sells all of its goods to Apparels Pvt Ltd
and Tales & Stories Denim Co Pvt Ltd., the company is wholly dependent on these two customers. Out of
total income, Company earns 68.54% from these two customers.

Loss of these customers could adversely affect the operating result or cash flow of the company.

24 Earnings per Share (EPS) as per Indian Accounting Standard 33

Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders of the parent
by the weighted average number of Equity shares outstanding during the year. Diluted EPS amounts are
calculated by dividing the profit attributable to equity holders of the parent (after adjusting for interest on the
convertible preference shares) by the weighted average number of Equity shares outstanding during the year
plus the weighted average number of Equity shares that would be issued on conversion of all the dilutive
potential Equity shares into Equity shares.

27 Contingent liabilities

There is no contingent liability as on March 31,2025.

28 Details of dues to micro and small enterprises as defined under the MSMED Act, 2006

Based on the information available with the company, there are no suppliers who are registered under the
Micro, Small and Medium Enterprises Development Act, 2006 as at March 31,2025. Hence, the disclosure
relating to amounts unpaid as at the year end together with interest paid/payable under this act have not
been given.

29 Other Statutory Information

a. The Company do not have any Benami property, where any proceeding has been initiated or pending
against the Company for holding any Benami property.

b. The Company do not have any transactions with companies struck off.

c. The Company have not traded or invested in Crypto currency or Virtual Currency during the financial year.

d. The Company have 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:

(i) 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

(ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

e. The Company have 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:

(i) 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

(ii) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

f. The Company have no such transaction which is 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 survey or any other relevant provisions of the Income Tax Act, 1961).

g. The Company do not have any subsidiary so there is no requirement to comply with the number of layers
prescribed under clause (87) of section 2 of the Act read with the Companies (Restriction on number of
Layers) Rules, 2017.

h. The Company do not have any charges or satisfaction which is yet to be registered with ROC beyond the
statutory period.

i. The Company has not entered with any Scheme(s) of arrangement in terms of sections 230 to 237 of the
Companies Act, 2013.

j. The Company has been maintaining its books of accounts in the accounting software which has feature of
recording audit trail of each and every transaction, creating an edit log of each change made in books of
account along with the date when such changes were made and ensuring that the audit trail cannot be
disabled, throughout the year as required by proviso to sub rule (1) of rule 3 of The Companies (Accounts)
Rules, 2014 known as the Companies (Accounts) Amendment Rules, 2021. The Company has preserved
Audit trail as per statutory requirements for record retention.

As per our report of even date For and on behalf of the Board of Directors

For KANTILAL PATEL & CO FOR SANBLUE CORPORATION LIMITED

CHARTERED ACCOUNTANTS
Firm registration number : 104744W

Jinal Patel Jose Daniel Dhaval Sheth

Partner Managing Director Chief Financial Officer

Membership No.: 153599 DIN : 03532474

Milan Shah Jekil Pancholi

Director Company Secretary

DIN : 10657608 Mem No : F12329

Place : Ahmedabad Place : Ahmedabad

Date : May 30, 2025 Date : May 30, 2025