(j) Provisions and contingent liability

A provision is recognised when the Company has
a present obligation as a result of past event, 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
of the amount of the obligation.

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. When discounting is used,
the increase in the provision due to the passage of
time is recognised as a finance cost.

A contingent liability is a possible obligation that
arises from past events whose existence will be
confirmed by the occurrence or non-occurrence
of one or more uncertain future events beyond the
control of the Company or a present obligation
that is not recognised because it is not probable
that an outflow of resources will be required to
settle the obligation. A contingent liability also
arises in extremely rare cases where there is
a liability that cannot be recognised because it
cannot be measured reliably. The Company does
not recognize a contingent liability but discloses its
existence in the financial statements.

Provisions, contingent liabilities are reviewed at
each Balance Sheet date.

(k) Retirement and other employee benefits

Employees' State Insurance Corporation (ESIC) are
defined contribution schemes whose contributions
are charged to the statement of profit and loss for
the pe riod when they are due to the respective
funds. There are no obligations other than the
contributions to the respective funds.

Retirement benefit in the form of provident fund
& Superannuation fund is a defined contribution
scheme. The Company has no obligation, other
than the contribution payable to the provident fund.
The Company recognizes contribution payable to
the provident fund scheme as an expense, when
an employee renders the related service. If the
contribution payable to the scheme for service
received before the balance sheet date exceeds the
contribution already paid, the deficit payable to the
scheme is recognised as a liability after deducting
the contribution already paid. If the contribution
already paid exceeds the contribution due for
services received before the balance sheet date,
then excess is recognised as an asset to the extent
that the pre-payment will lead to, for example, a
reduction in future payment or a cash refund.

The Company operates a defined benefit gratuity
plan. The Company contributes to a gratuity fund
maintained by an independent insurance company.
The cost of providing benefits under the defined
benefit plan is determined using the projected unit
credit method.

Remeasurements comprising of actuarial
gains and losses, the effect of the asset ceiling,
excluding amounts included in net interest on
the net defined benefit liability and the return on
plan assets (excluding amounts included in net
interest on the net defined benefit liability), are
recognised immediately in the balance sheet with a
corresponding debit or credit to retained earnings
through OCI in the period in which they occur.
Remeasurements are not reclassified to profit or
loss in subsequent periods.

Net interest is calculated by applying the discount
rate to the net defined benefit liability or asset. The
Company recognises the following changes in the
net defined benefit obligation as an expense in the
statement of profit and loss:

?? Service costs comprising current service
costs, past-service costs, gains and losses on
curtailments and non-routine settlements; and

?? Net interest expense or income

Leave encashment / Compensated absences

Accumulated leave, which is expected to be utilised
within the next twelve months, is treated as short¬
term employee benefit. The Company measures the
expected cost of such absences as the additional
amount that it expects to pay as a result of the
unused entitlement that has accumulated at the
reporting date.

The Company treats accumulated leave expected
to be carried forward beyond twelve months, as
long-term employee benefit for measurement
purposes. Such long-term compensated absences
are provided for based on the actuarial valuation
using the projected unit credit method at the
year-end. Actuarial gain/loss are immediately
taken to the statement of profit and loss and are
not deferred. The Company presents the entire
leave as a current liability in the balance sheet,
since it does not have an unconditional right to
defer its settlement for twelve months after the
reporting date.

(l) Financial instruments

Financial instruments are recognised when the
Company becomes a party to the contract that
gives rise to financial assets and financial liabilities.
All financial assets and liabilities are recognized
at fair value on initial recognition, except for
trade receivables which are initially measured at
transaction price. Transaction costs that are directly
attributable to the acquisition or issue of financial
assets and financial liabilities, which are not at fair
value through profit or loss, are added to the fair
value on initial recognition. Purchases or sales
of financial assets that require delivery of assets
within a time frame established by regulation or
convention in the marketplace (regular way trades)
are recognised on the trade date, i.e., the date that
the Company commits to purchase or sell the asset.

Subsequent measurement

Financial Assets

Financial assets at amortised cost

A 'financial asset' is measured at the amortised
cost if both the following conditions are met:

a) The asset is held within a business model
whose objective is to hold assets for collecting
contractual cash flows, and

b) Contractual terms of the asset give rise on
specified dates to cash flows that are solely
payments of principal and interest (SPPI) on
the principal amount outstanding.

This category is the most relevant to the Company.
After initial measurement, such financial assets are
subsequently measured at amortised cost using the
effective interest rate (EIR) method. Amortised cost
is calculated by taking into account any discount or
premium on acquisition and fees or costs that are
an integral part of the EIR. The EIR amortisation is
included in finance income in the profit or loss. The
losses arising from impairment are recognised in
the profit or loss. The Company's financial assets
at amortised cost includes trade receivables, Cash
and cash equivalents, other bank balances and
Net investment in leases and Security deposits
included under other current and non-current
financial assets.

Financial assets at fair value through OCI
(FVTOCI)

A financial asset is subsequently measured at fair
value through other comprehensive income if it
is held within a business model whose objective
is achieved by both collecting contractual
cash flows and selling financial assets and the
contractual terms of the financial asset give rise
on specified dates to cash flows that are solely
payments of principal and interest on the principal
amount outstanding.

Financial assets at fair value through profit
or loss

Financial assets at fair value through profit or
loss are carried in the balance sheet at fair value
with net changes in fair value recognised in the
statement of profit and loss. This category includes
investment in mutual fund.

Impairment of financial assets:

For trade receivables, 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 recognises an allowance for expected
credit losses (ECLs) for all debt instruments not
held at fair value through profit or loss. ECLs are

based on the difference between the contractual
cash flows due in accordance with the contract
and all the cash flows that the Company expects
to receive, discounted at an approximation of
the original effective interest rate. The expected
cash flows will include cash flows from the sale of
collateral held or other credit enhancements that
are integral to the contractual terms.

The amount of ECLs (or reversal) that is required
to adjust the loss allowance at the reporting date
to the amount that is required to be recorded
is recognized as an impairment loss or gain in
statement of profit and loss.

Financial liabilities

Financial liabilities at amortised cost

This is the category most relevant to the Company.
After initial recognition, interest-bearing loans
and borrowings are subsequently measured at
amortised cost using the EIR method. Gains and
losses are recognised in profit or loss when the
liabilities are derecognised as well as through the
EIR amortisation process.

The Company enters into deferred payment
arrangements (acceptances) whereby overseas
lenders such as banks and other financial
institutions make payments to supplier's banks for
purchase of raw materials and others. The banks
and financial institutions are subsequently repaid
by the Company at a later date providing working
capital benefits. These arrangements are in the
nature of credit extended in normal operating
cycle and these arrangements for raw materials are
recognised as Acceptances (under trade payables).

Derecognition of financial instruments

The Company derecognizes a financial asset when
the contractual rights to the cash flows from the
financial asset expire or it transfers the financial asset
and the transfer qualifies for derecognition under
Ind AS 109. A financial liability is derecognised
when the obligation under the liability is discharged
or cancelled or expires. When an existing financial
liability is replaced by another from the same
lender on substantially different terms, or the terms
of an existing liability are substantially modified,
such an exchange or modification is treated as
the derecognition of the original liability and the
recognition of a new liability. The difference in the
respective carrying amounts is recognised in the
statement of profit and loss.

(m) Fair value measurement

The Company measures financial instruments, such
as, mutual funds at fair value at each balance sheet
date. Fair value is the price that would be received
to sell an asset or paid to transfer a liability in an
orderly transaction between market participants at
the measurement date. The fair value measurement
is based on the presumption that the transaction
to sell the asset or transfer the liability takes
place either:

?? In th e principal market for the asset or
liability, or

?? In the absence of a principal market, in the
most advantageous market for the asset
or liability

The principal or the most advantageous market
must be accessible by the Company. The fair
value of an asset or a liability is measured using
the assumptions that market participants would
use when pricing the asset or liability, assuming
that market participants act in their economic
best interest.

The Company uses valuation techniques that are
appropriate in the circumstances and for which
sufficient data are available to measure fair value,
maximising the use of relevant observable inputs
and minimising the use of unobservable inputs.

All assets and liabilities for which fair value is
measured or disclosed in the financial statements
are categorised within the fair value hierarchy,
described as follows, based on the lowest level input
that is significant to the fair value measurement as
a whole:

?? Level 1 —Quoted p

active market or Net Asset Value (NAV) for
identical assets or liabilities.

?? Level 2 — Val

the lowest level input that is significant to
the fair value measurement is directly or
indirectly observable

?? Level 3 — Val uation techniques for which
the lowest level input that is significant to the
fair value measurement is unobservable

For assets and liabilities that are recognised in
the financial statements on a recurring basis,
the Company determines whether transfers have
occurred between levels in the hierarchy by re¬
assessing categorisation (based on the lowest level
input that is significant to the fair value measurement
as a whole) at the end of each reporting period.

(n) Cash and cash equivalents

Cash and cash equivalents for purpose of cash flow
statement comprise cash at bank and in hand and
short term investments 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.

(o) Other income
Interest income:

Interest is recognised using the effective interest
rate (EIR) method, as income for the period in
which it occurs. EIR is the rate that exactly discounts
the estimated future cash payments or receipts over
the expected life of the financial instrument to the
gross carrying amount of the financial asset or to
the amortised cost of a financial liability. When
calculating the effective interest rate, the Group
estimates the expected cash flows by considering
all the contractual terms of the financial instrument
(for example, prepayment, extension, call and
similar options) but does not consider the expected
credit losses.

Dividend:

The Company recognises a liability to make cash
distributions to equity holders of the Company when
the distribution is authorised, and the distribution is
no longer at the discretion of the Company. Final
dividends on shares are recorded as a liability on
the date of approval by the shareholders.

(p) Borrowing costs

All other borrowing costs are expensed in the
period in which they occur. Borrowing costs consist
of interest and other costs that an entity incurs in
connection with the borrowing of funds.

(q) Earnings per share

Basic earnings per share are calculated by dividing
the net profit or loss for the period attributable
to equity shareholders by the weighted average
number of equity shares outstanding during the
period. Partly paid equity shares are treated as a
fraction of an equity share to the extent that they
are entitled to participate in dividends relative to a
fully paid equity share during the reporting period.

For the purpose of calculating diluted earnings
per share, the net profit or loss for the period
attributable to equity shareholders and the
weighted average number of shares outstanding
during the period are adjusted for the effects of
all dilutive potential equity shares.

2.3.Standards notified but not yet effective

There are no standards that are notified and not yet
effective as on the date.

2.4.Climate - related matters

The Company considers climate-related matters in
estimates and assumptions, where appropriate. This
assessment includes a wide range of possible impacts
on the Company due to both physical and transition
risks. Even though the Company believes its business
model and products will still be viable after the transition
to a low-carbon economy, climate-related matters
increase the uncertainty in estimates and assumptions
underpinning several items in the Ind AS financial
statements. Even though climate-related risks might not
currently have a significant impact on measurement, the
Company is closely monitoring relevant changes and
developments, such as new climate-related legislation.
The items and considerations that are most directly
impacted by climate-related matters are:

?? Useful life of property, plant and equipment. When
reviewing the residual values and expected useful
lives of assets, the Company considers climate-
related matters, such as climate-related legislation
and regulations that may restrict the use of assets
or require significant capital expenditures. See
Note 2.2 e) for further information.

6.1 Pu rsuant to requirements of Electricity Act, the Company has subscribed 2,250,000 equity shares* of ' 10 each of
Parola Renewables Private Limited ("Parola") for a purchase consideration of ' 22.50 million ("Subscription Price").
Further, pursuant to Power Supply and Offtake Agreement, the Company has agreed to purchase total solar power to be
generated from solar plant having installed capacity i.e., 7.5 MWDC. As per the Share Subscription and Shareholders
Agreement ("SSSA") between the Company, Parola and Radiance Renewables Private Limited ("Majority Shareholder"),
the Company has an option to sell back the aforesaid equity shares at the Subscription Price and the Majority Shareholder
has an option to call for selling the share at the subscription price. Accordingly, these investments are carried at amortised
cost as financial assets. At the inception, these financial assets are recognised at fair value and the difference between
the fair value and the subscription price of ' 13.32 million is recorded as prepaid power expenses being amortised
over the term of the agreement. As at March 31, 2025, prepaid expenses is ' 10.21 million (March 31, 2024: ' 13.04
million).

6.2 Pu rsuant to requirements of Electricity Act, the Company has agreed to subscribe and pay for 4,146,559 equity
shares* of ' 10 each of Torrent Saurya Urja 3 Private Limited ("Torrent ") for a purchase consideration of ' 41.47
million ("Subscription Price"). Further, pursuant to Power Supply and Offtake Agreement, the Company has agreed to
purchase total solar power to be generated from solar plant having installed capacity i.e., 12 MWDC. As per the Share
Subscription and Shareholders Agreement ("SSSA") between the Company, Torrent and Torrent Power Limited ("Majority
Shareholder"), the Company has an option to sell back the aforesaid equity shares at the Subscription Price and the
Majority Shareholder has an option to call for selling the share at the subscription price. Accordingly, these investments
are being carried at amortised cost as financial assets. At the inception, these financial assets are recognised at fair
value and the difference between the fair value and the subscription price of ' 20.63 million is recorded as prepaid
power expenses being amortised over the term of the agreement. As at March 31, 2025, prepaid expenses is ' 20.63
million (March 31, 2024: nil).

14.1 Nature and purpose of reserves

a) Securities premium

Securities premium is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes
in accordance with the provisions of Section 52 of the Companies Act, 2013.

b) Retained earnings

Retained earnings are the profits/(loss) that the Company has earned till date, less any transfers to general reserve,
dividends or other distributions paid to shareholders. Retained earnings include re-measurement loss / (gain) on defined
benefit plans, net of taxes that will not be reclassified to Statement of Profit and Loss.

14.1 Nature and purpose of reserves (contd.)

c) General reserve

Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a
specified percentage in accordance with applicable regulations. The purpose of these transfers was to ensure that if a
dividend distribution in a given year is more than 10% of the paid-up capital of the Company for that year, then the total
dividend distribution is less than the total distributable results for that year. Consequent to introduction of Companies
Act 2013, the requirement to mandatorily transfer a specified percentage of the net profit to general reserve has been
withdrawn. However, the amount previously transferred to the general reserve can be utilised only in accordance with
the specific requirements of Companies Act, 2013.

(a) Trade receivables are non-interest bearing and are generally on terms of 30 to 60 days. During the year ended March
31, 2025, Nil (March 31, 2024: Nil) was recognised as provision for expected credit losses on trade receivables.

(b) Contract liabilities represents amounts received by the Company from customers prior to the delivery of goods and are
recorded as liabilities in these financial statements until the goods are delivered.

22.3 Performance obligation

(a) The performance obligation is satisfied upon shipment/ delivery of goods.

(b) During the year ended March 31, 2025, the Company recognised revenue of ' 144.26 million arising from contract
liabilities as at March 31, 2024. During the year ended March 31, 2024, the Company recognised revenue of ' 2.89
million arising from contract liabilities as at March 31, 2023.

22.4 There are no significant adjustment between the contracted price and revenue recognised

The preparation of the Company's financial statements requires management to make judgements, estimates and
assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying
disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result
in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods

Other disclosures relating to the Company's exposure to risks and uncertainties includes:

i) Capital management (refer note 42)

ii) Financial risk management risk and policies (refer note 41)

iii) Sensitivity analyses disclosures (refer note 41)

32.1 Judgements:

I n the process of applying the Company's accounting policies, management has made the following judgements, which
have the most significant effect on the amounts recognised in the financial statements:

a) Lease classification - Company as lessor:

The Company had entered into lease agreements with Meritor HVS India Limited ('MHVSIL') and Meritor Commercial
Vehicle Systems India Private Limited ('MCVSIPL') to obtain a land on lease from MHVSIL and to construct test lab
building ('Bu ilding') and lease to MCVSIPL for R&D activities. The present value of the minimum lease payments
amounts to substantially all of the fair value of the property and accounted for the contracts as finance lease based on
the evaluation of the terms and conditions of the arrangements [refer note 34(b)].

b) Determination of significant influence over investee:

In accordance with the provisions of the Electricity Act applicable to a captive user, the Company invested ' 22.50 million
in exchange for a 26% equity shares in Parola Renewables Private Limited ("Parola"). The Company lacks significant
influence over the operations of Parola. Therefore, it is not classified as an associate under the guidelines of Ind AS 28,
Investments in Associates and Joint Ventures.

Furthermore, in accordance with the provisions of the Electricity Act applicable to a captive user, the Company invested
' 41.47 million in exchange for a 26% equity shares of Torrent Saurya Urja 3 Private Limited ("Torrent"). The Company
lacks significant influence over the operations of Torrent. Therefore, it is not classified as an associate under the guidelines
of Ind AS 28, Investments in Associates and Joint Ventures.

32.2 Estimates and assumptions:

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have
a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial
year, are described below. The Company based its assumptions and estimates on parameters available when the financial
statements were prepared. Existing circumstances and assumptions about future developments, however, may change due
to market changes or circumstances arising that are beyond the control of the Company. Such changes are reflected in the
assumptions when they occur.

a) Defined benefit plans (gratuity benefits):

The cost of the defined benefit gratuity plan and the present value of the gratuity obligation are determined using actuarial
valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in
the future. These include the determination of the discount rate, future salary increases and mortality rates. Due to the
complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes
in these assumptions. All assumptions are reviewed at each reporting date.

The parameter most subject to change is the discount rate. In determining the appropriate discount rate for plans
operated in India, the management considers the interest rates of government bonds in currencies consistent with the
currencies of the post-employment benefit obligation.

The mortality rate Is based on publicly available mortality tables. These mortality tables tend to change only at interval
in response to demographic changes. Future salary increases and gratuity increases are based on expected future
inflation rates.

b) Provision for inventories:

Management reviews the aged inventory on a periodic basis. The purpose is to ascertain whether an allowance is required
to be made in the financial statements for any obsolete and slow-moving items. The management also evaluates on the
usability of existing inventories as a result of technological and regulatory changes in the automotive sector if any and
provides for the required allowances for slow moving/ non-moving and obsolete inventory. This review also involves
comparison of the carrying value of the aged inventory item with the respective net realisable value. Management
believes that adequate allowance for obsolete and slow-moving inventories has been made in the financial statements.

c) Impairment of financial assets:

The impairment provisions for financial assets are based on assumptions about risk of default and expected loss rates.
The Company uses judgement in making these assumptions and selecting the inputs to the impairment calculation,
based on Company's past history, existing market conditions as well as forward looking estimates at the end of each
reporting period.

d) Provision for warranty:

Warranty estimates are established using historical information on the nature, frequency and average cost of warranty
claims and also management estimates regarding possible future outflow on servicing the customers for any corrective
action in respect of product failure.

e) Leases - estimating the incremental borrowing rate:

The Company cannot readily determine the interest rate implicit in the lease, therefore, it uses its incremental borrowing
rate (IBR) to measure lease liabilities. The IBR is the rate of interest that the Company would have to pay to borrow over
a similar term, and with a similar security, the funds necessary to obtain an asset of a similar value to the right-of-use
asset in a similar economic environment.

f) Useful lives of property, plant and equipment:

Management reviews the useful lives of property, plant and equipment at least once a year. Such lives are dependent
upon an assessment of both the technical life of the assets and also their likely economic lives based on various
internal and external factors including relative efficiency and operating costs. This reassessment may result in change
in depreciation and amortisation expected in future periods.

33 Segment reporting

The Board of Directors is the Chief Operating Decision Maker (CODM) and monitors the operating results of its
business units separately for the purpose of making decisions about resource allocation and performance assessment.
The Company is predominantly engaged in the business of manufacturing and sale of automotive components, which
constitutes a single business segment and is governed by similar set of risks and returns. The operations of the Company
primarily cater to the market in India, which the Chief Operating Decision Maker (CODM) views as a single segment.
The CODM monitors the operating results of its single segment for the purpose of making decisions about resource
allocation and performance assessment.

Revenues from transactions with a single external customer amounting to 10 per cent or more of the Company's revenues
is ' 16,686.22 million (March 31, 2024: ' 17,497.32 million).

The Company is domiciled in India. The Company's revenue from operations from external customers primarily relate
to operations in India and all the non-current assets of the Company are located in India.

34 Leases

a) Company as a lessee

I) The Company has entered into leases contracts consisting of the Company's manufacturing facilities which includes
buildings. These leases are for a period of ten years. The Company Is restricted from assigning and sub leasing
the lease assets. The Company's obligations under Its leases are secured by the lessor's title to the leased assets.
The Company also has certain leases with lease terms of 12 months or less. The Company applies the 'short-term
lease' recognition exemption for these leases.

II) During the year ended March 31, 2025, the Company had entered Into an agreement with a buyer to sell Its
lease pertaining to the Pithampur land. The sale consideration of ' 127.50 million was received from the buyer
on June 12, 2024. Further, the Company has recorded a loss of ' 2.56 million In the statement of profit and loss
after adjusting the existing right-of-use asset and lease liability created for the aforesaid land, as a result of the
sale transaction.

b) Company as a lessor

The Company had entered into lease agreements dated July 01, 2018 with Meritor HVS India Limited ('MHVSIL') and
Meritor Commercial Vehicle Systems India Private Limited ('MCVSIPL') to obtain a land on lease from MHVSIL and to
construct test lab building ('Building'); and further lease out to MCVSIPL for research and development activities. The
lease term is 20 years. Since both the aforesaid lease agreements were entered with related parties on the same date
and negotiated as one lease, these leases are essentially treated as a single contract in substance, wherein, the Company
is the lessor of the Building and MCVSIPL is the lessee. The carrying amount of net investment in lease is ' 111.33
million (March 31, 2024: 112.93 million). Net finance income on lease receivables recognised by the Company during
the year is ' 8.91 million (March 31, 2024: ' 9.83 million).

Terms and conditions of transactions with related parties

The sales to and purchases from related parties are made on terms equivalent to those that prevail in arm's length
transactions. Amounts owed to and by related party are unsecured and interest free and settlement occurs in cash.
There have been no guarantees provided or received for any related party receivables or payables. For the year ended
March 31, 2025, the Company has recorded impairment of Nil towards receivables from related parties (March 31,
2024: Nil). This assessment is undertaken each financial year through examining the financial position of the related
party and the market in which the related party operates.

37 Employee benefits

Defined contribution plans

A. Provident fund and employee state insurance scheme

The Company makes contributions to provident fund and employee state insurance scheme ("Schemes"), which
are defined contribution plan for eligible employees and the contributions are charged to the statement of profit
and loss of the year when the contributions to the respective funds are due. Under the Schemes, the Company is
required to contribute a specified percentage of the salary to fund the benefits. The Company recorded an expense
of ' 50.43 million (March 31, 2024: 54.48 million) towards contribution of provident fund and ' 3.03 million
(March 31, 2024: ' 4.48 million) towards contribution of employee state insurance scheme in the statement of
profit and loss.

B. Superannuation fund

Retirement benefits in the form of superannuation fund (being administered by LIC) are funded defined contribution
schemes and the contributions are charged to the statement of profit and loss of the year when the contributions to
the respective funds are due. There are no other obligations other than the contribution payable. The contributions
for the year ended March 31, 2025 is ' 5.84 million (March 31, 2024: ' 7.03 million).

Defined benefit plans

The Company has a defined benefit gratuity plan for its employees. The gratuity plan is governed by the Payment of
Gratuity Act, 1972. Under the act, employee who has completed five years of service is entitled to specific benefit. The
level of benefits provided depends on the member's length of service and salary at retirement age. The Company makes
provision of such gratuity liability in the books of accounts on the basis of actuarial valuation as per the projected unit
credit method.

The following tables summarize the components of net benefit expense recognized in the Statement of Profit and Loss
and the funded status and defined benefit obligation recognized in the Balance Sheet.

Risk analysis

The Company Is exposed to the following risks in the defined benefits plans :

Investment Risk: The present value of the defined benefit obligation Is calculated using a discount rate which Is
determined by reference to market yields at the end of the reporting period on government bonds. If the return on plan
assets Is below this rate, it will create a plan deficit.

Interest risk: A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset
by increase in the return on the plan's debt investments.

Longevity risk: The present value of the defined benefit plan liability Is calculated by reference to the best estimate
of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the
plan participants will increase the plan's liability.

Salary growth risk: The present value of the defined benefit plan liability Is calculated by reference to the future
salaries of plan participants. An increase in the salary of the plan participants will increase the plan's liability.

The Company's principal financial liabilities comprise borrowings, lease liabilities and trade and other payables. The main
purpose of these financial liabilities is to finance the Company's operations. The Company's principal financial assets
include loans, trade and other receivables, short term investments and cash and cash equivalents that derive directly from
its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The Company's senior management oversees the
management of these risks. The Board of Directors reviews and agrees policies for managing each of these risks, which are
summarised below:

i. 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 risk: interest rate risk, currency risk and other price risk, such
as equity price risk and commodity risk. Financial instruments affected by market risk include loans and borrowings.
The sensitivity analyses in the following sections relate to the position as at March 31, 2025 and March 31, 2024. The
sensitivity analyses have been prepared on the basis that the amount of net debt, the ratio of fixed to floating interest
rates of the debt.

The analyse exclude the impact of movement in market variables on the carrying values of gratuity and other post
retirement obligations and provisions.

The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks. This is
based on the financial assets and financial liabilities held at March 31, 2025 and March 31, 2024.
a. Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of
changes in market interest rates. The following table demonstrates the sensitivity to a reasonably possible change
in interest rates on that portion of loans and borrowings affected. The Company manages its interest rate risk by
monitoring the movements in the market interest rates closely. With all other variables held constant, the Company's
profit before tax and equity is affected through the impact on floating rate borrowings, as follows:

b. Foreign currency risk

Foreign currency risk Is the risk that the fair value or future cash flows of an exposure will fluctuate because of
changes in foreign exchange rates. The Company's exposure to the risk of changes in foreign exchange rates relates
primarily to the Company's operating activities (when revenue or expense is denominated in a foreign currency).
The Company manages its foreign exchange fluctuation risk by monitoring the movements in the exchange rate
in the market closely. As on March 31, 2025, the Company has following foreign currency exposures:

C. Commodity price risk

Commodity price risk results from changes in market prices for raw materials, mainly steel, forgings and casting
which forms the largest portion of Company's cost of sales.

The principal raw materials for the Company products are steel, forgings and casting which are purchased by the
Company from the approved list of suppliers. Most of the input materials are procured from domestic vendors.
Further, a significant portion of the Company's volume is sold based on price adjustment mechanism which allows
for recovery of the changed raw material cost from its customers. The Company is affected by the price volatility
of certain commodities. However the Company is able to pass on price fluctuations to its customers resulting from
changes in commodity prices, thereby neutralizing the impact on profit due to commodity price risk.

ii. Credit risk

Credit risk Is the risk that counterparty will not meet its obligations under a financial instrument or customer contract,
leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables)
and from its investing activities, including deposits with banks and financial institutions, other receivables and deposits,
and other financial instruments.

a. Trade Receivable

The Company mainly sells to its related parties, OEMs and Tier I companies, having long standing relationship
with the Company. Outstanding customer receivables are regularly monitored and reconciled. At March 31, 2025,
receivable from Company's top 3 customers accounted for approximately 99% (March 31, 2024: 99%) of all the
receivables outstanding. An impairment analysis is performed at each reporting date on an individual basis for
major clients. Based on historical experience, the Company does not have any material bad debts. The Company
does not hold collateral as security. The maximum exposure to credit risk at the reporting date is the carrying value
of each class of financial assets. Further, for movement in provision for doubtful receivables during the year refer
note 10.

b. Bank Balance and other Financial Assets

Credit risk from balances with banks is managed by the Company in accordance with its policy. Investments of
surplus funds of ' 774.75 million (March 31, 2024: ' 209.93 million) are made only with approved counterparties
and within credit limits assigned to each counterparty. Further other financial assets include net investment of
lease of ' 111.33 million, (March 31, 2024: ' 112.93 million) receivables from related party. Based on historical
experience, the Company does not have any material bad debts.

iii. Liquidity risk

Liquidity risk refers to the risk that the Company cannot meet its financial obligations. The objective of liquidity risk
management is to maintain sufficient liquidity and ensure that the funds are available for use as per the requirements.
The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities,
by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and
liabilities. The Company consistently generates sufficient cash flows from operations to meet its financial obligations as
and when they fall due.

For the purpose of the Company's capital management, capital includes issued equity capital, securities premium and all
other equity reserves. The primary objective of the Company's capital management is to maximise the shareholder value.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the
requirements of the financial covenants. The Company includes within net debt, interest bearing loans and borrowings,
lease liabilities, less cash and cash equivalents. The Company's gearing ratio, which is total borrowings divided by total
capital employed is as below:

44 Other Statutory information for the years ended March 31, 2025 and March 31, 2024

(I) The Company do not have any Benami property, where any proceeding has been initiated or pending against the Company
for holding any Benami property under the Benami Transactions (Prohibition) Act, 1988 and rules made thereunder.

(II) The Company do not have any transactions with companies struck off under Section 248 of the Companies Act, 2013
or Section 560 of Companies Act, 1956.

(III) The Company do not have any charges or satisfaction which Is yet to be registered with ROC beyond the statutory period.
(Iv) The Company have not traded, Invested nor holding any crypto currency or virtual currency.

(v) The Company have not advanced or loaned or Invested funds to any other person or entity, 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

(vi) 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:

(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,

(vii) The Company has not entered Into any 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).

(viii) The Company has not been declared as wilful defaulter by any bank or financial Institution or other lender.

45 Transfer pricing

The Company maintains the Information and documents as required under the transfer pricing regulations under Section
92-92F of the Income Tax Act, 1961. The Management Is In the process of updating the transfer pricing documentation
for the financial year ended March 31,2025 and Is of the view that Its transactions are at arm's length and the aforesaid
legislation will not have any Impact on the financial statements, particularly on the amount of tax expense and that of
provision for taxation.

46 Proper books of account as required by law have been kept by the Company.

The Company has used accounting software SAP for maintaining Its books of account which has a feature of recording
audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded In
the software, except that audit trail feature Is not enabled at the database level Insofar as It relates to SAP accounting
software. Further no Instance of audit trail feature being tampered with was noted In respect of accounting software
where the audit trail has been enabled.

Additionally, based on the requirements of section 128(5) of the Companies Act, 2013, the Company has preserved
the requirements of recording audit trail to the extent It was enabled and recorded In respect of the prior year

47 I n light of the tariffs imposed by U.S.A., the Management has evaluated the likely impact of prevailing uncertainties
relating to imposition or enhancement of reciprocal tariffs and believes that there are no material impacts on the
financial statements of the Company for the year ended March 31, 2025. However, the Management will continue to
monitor the situation from the perspective of potential impact on the operations of the Company.

48 Events occurring after balance sheet

The Board of Directors have proposed dividend of ' 30.50 per share after the balance sheet date which is subject to
approval by the shareholders at the annual general meeting.

As per our report of even date attached

For S.R. Batliboi & Associates LLP For and on behalf of the Board of Directors of

Chartered Accountants Automotive Axles Limited

ICAI Firm Registration Number: 101049W/E300004 CIN: L51909KA1981PLC004198

per Sunil Gaggar Nagaraja Gargeshwari Dr. B. N. Kalyani

Partner Whole Time Director Chairman

Membership No.: 104315 DIN: 00839616 DIN: 00089380

Place: Bengaluru Place : Pune Place : Pune

Date : May 20, 2025 Date : May 20, 2025 Date : May 20, 2025

Ranganathan S Debadas Panda

Chief Financial Officer Company Secretary

Membership No: 16898

Place : Pune Place : Pune

Date : May 20, 2025 Date : May 20, 2025