k. Provisions, Contingent Liabilities and Contingent Assets

(i) Provisions

Provisions are recognised when the Company has a present obligation (legal or constructive)
as a result of a past event, it is probable that an outflow of resources will be required
to settle the obligation and a reliable estimate can be made. The expense relating to a
provision is presented in the statement of profit and loss net of any reimbursement.

If the effect of 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.

(ii) Contingent Liabilities

Contingent liabilities are disclosed when there is a possible obligation arising from past
events, the existence of which will be confirmed only by the occurrence or non-occurrence
of one or more uncertain future events not wholly within the control of the Company or
a present obligation that arises from past events where it is either not probable that an
outflow of resources will be required to settle the obligation or a reliable estimate of the
amount cannot be made.

(iii) Contingent Assets

Contingent Assets are not recognised in the financial statements. Contingent Assets if any,
are disclosed in the notes to the financial statements.

l. Non-current assets held for sale

Non-current assets are classified as held for sale if their carrying amount will be recovered
principally through a sale transaction rather than through continuing use. This condition is
regarded as met only when the asset is available for immediate sale in its present condition
subject only to terms that are usual and customary for sale of such asset and its sale is highly
probable. For the sale to be highly probable, the appropriate level of management must be
committed to a plan to sell the asset and an active programme to locate a buyer and complete
the plan must have been initiated.

m. Revenue Recognition

(i) Sale of goods

- Revenue from the domestic sales are recognised net of returns and allowances, trade

discounts and volume rebates upon delivery which is when the control of the goods
passes to the Customer and performance obligation is met at a point in time.

- Revenue from the export sales are recognised net of returns and allowances, trade
discounts and volume rebates upon delivery, usually on the basis of dates of bill of
lading which is when the control of the goods passes to the Customer and performance
obligation is met at a point in time.

(ii) Sale of Service

Revenue is recognised from sale of services and services rendered by the Company
pertaining to scaling of production process, engineering assistance, pilot projecting etc,
when the performance obligation is satisfied and the services are rendered in accordance
with the terms of customer contracts.

(iii) Export incentives

Revenue from export incentives are accounted on export of goods if the entitlements can
be estimated with reasonable assurance and conditions precedent to claim are fulfilled.

(iv) Interest Income

(a) Interest income is recognised as the interest accrues (using the effective interest rate,
that is, the rate that exactly discounts estimated future cash receipts through the
expected life of the financial instrument to the net carrying amount of the financial
asset).

(b) Interest income on fixed deposits with banks is recognised on time basis.

(v) Dividend Income

Dividend income on investments is recognised when the right to receive dividend is
established.

n. Employee Benefits

Liabilities in respect of employee benefits to employees are provided for as follows:

(i) Short term employee benefits:

Liabilities for wages, salaries, bonus and medical benefits including non-monetary benefits
that are expected to be settled wholly within twelve months after the end of the period in
which the employees render the related service are recognised in respect of employees'
service up to the end of the reporting period and are measured at the amounts expected to
be incurred when the liabilities are settled. The liabilities are presented as current employee
benefit obligations in the balance sheet.

(ii) Post-employment benefits:

Defined contribution plans

Payments to defined contribution plans for eligible employees in the form of superannuation
fund and the Company's contribution to Provident Fund are recognised as an expense in
the Statement of Profit and Loss as the related service is provided.

Defined benefit plans

The Company has an obligation towards gratuity, a defined benefit retirement plan
covering eligible employees. The Company's net obligation in respect of defined benefit
plan is calculated by estimating the amount of future benefit that employees have earned
in current and prior periods, after discounting the same. The calculation of defined
benefit obligation is performed annually by a qualified actuary using the projected unit
credit method. The defined benefit obligation recognised in the Balance Sheet represent
the present value of the defined benefit obligation as reduced by the fair value of plan
assets. Any defined benefit asset (negative defined benefit obligation resulting from this
calculation) representing the present value of available refunds and reductions in future
contributions to the plan is recognised.

All expenses represented by current service cost, past service cost, if any, and net interest
expense / (income) on the net defined benefit liability / (asset) are recognised in the
Statement of Profit and Loss. Remeasurements of the net defined benefit liability / (asset)
comprising actuarial gains and losses are recognised immediately in Other Comprehensive
Income (OCI).

When the benefits of a plan are changed or when a plan is curtailed, the resulting change
in benefit that relates to past service or the gain or loss on curtailment is recognised
immediately in the Statement of Profit and Loss. The Company recognises gains and losses
on the settlement of a defined benefit plan when the settlement occurs.

(iii) Other long-term employee benefits

Other long term employee benefits represent liabilities for earned leave that are not expected
to be settled wholly within 12 months after the end of the period in which the employees render
the service. These liabilities are measured as the present value of expected future payments to
be made in respect of services provided by the employees up to the end of the reporting period
using the projected unit credit method. Remeasurements are recognised in the Statement of
Profit and Loss in the period in which they arise. Actuarial gains and losses in respect of such
benefits are charged to the Statement of Profit and Loss in the period in which they arise.

o. Share-based payment transactions

Employees Stock Options Plans (“ESOPs”): The fair value of options granted to employees is
recognised as an employee expense, with a corresponding increase in equity, over the period
that the employees become unconditionally entitled to the options. The expense is recorded for
each separately vesting portion of the award. The increase in equity recognised in connection
with share based payment transaction is presented as a separate component in equity under
“Employee Stock Options Outstanding”.

p. Borrowing Cost

Borrowing costs are interest and other costs that the Company incurs in connection with the
borrowing of funds and is measured with reference to the effective interest rate applicable to the
respective borrowing. Borrowing costs also include exchange differences on foreign currency
borrowings to the extent they are regarded as an adjustment to interest costs.

Borrowing costs pertaining to the period from commencement of activities relating to the
construction / development of qualifying asset till the time all activities necessary to prepare
the qualifying asset for its intended use or sale are complete are capitalised. Any income earned
from temporary investment of borrowed funds is deducted from borrowing costs incurred.

A qualifying asset is an asset that necessarily requires a substantial period of time to get ready
to its intended use or sale.

All other borrowing costs are recognised as an expense in the period in which they are incurred.

q. Foreign currency transactions / translations

Transactions in foreign currencies are initially recorded at the functional currency spot rate of
exchange prevailing on the date of transaction.

Monetary assets and liabilities denominated in foreign currencies and remaining unsettled at the
reporting date are translated into the functional currency at the exchange rate prevailing on the
reporting date.

Non- monetary items that are measured based on historical cost in a foreign currency are not
translated.

Exchange differences arising on settlement of transactions or translation of monetary assets and
liabilities at rates different from those at which they were translated on initial recognition during
the period or in the previous financial statements are recognised in the Statement of Profit and
Loss in the year in which they arise except for exchange differences recognised as a part of
qualifying assets.

r. Income tax

Income tax expense comprises current and deferred tax. It is recognised in the Statement of
Profit and Loss except to the extent that it relates to items recognised directly in other equity or
in other comprehensive income, in which case, the tax is also recognised directly in other equity
or other comprehensive income, respectively.

(i) Current Tax

Current tax is determined as the amount of tax payable or recoverable in respect of taxable
income or loss for the year and any adjustment to the tax payable in respect of previous
years. It is measured using tax rates that are enacted or substantively enacted at the
reporting date.

Minimum Alternate Tax (MAT) is accounted as current tax when the Company is subjected
to such provisions of the Income Tax Act, 1961. However, credit of such MAT paid is available
when the Company is subject to tax as per normal provisions in the future.

Current tax assets and liabilities are offset only if, the Company:

a) has a legally enforceable right to set off the recognised amounts; and

b) Intends either to settle on a net basis, or to realise the asset and settle the liability
simultaneously.

(ii) Deferred Tax

Deferred tax is recognised in respect of temporary differences between the carrying
amounts of assets and liabilities for financial reporting purposes and amounts used for
taxation purposes.

Deferred tax liabilities are recognised for all taxable temporary differences. Deferred tax
assets are amounts of income taxes in future periods in respect of deductible temporary
differences, unused tax losses, and unused tax credits to the extent it is probable that
future taxable profits will be available against which they can be used. Deferred tax assets
are reviewed at each reporting date and are reduced to the extent that it is no longer
probable that sufficient taxable profit will be available to allow the benefit of part or all of
the deferred tax asset to be utilised.

Deferred tax is measured at the tax rates that are expected to be applied to temporary
differences when they reverse, using tax rates enacted or substantively enacted at the
reporting date.

Unrecognised deferred tax assets are reassessed at each reporting date and recognised to
the extent that it has become probable that future taxable profits will be available against
which they can be recovered.

The measurement of deferred tax reflects the tax consequences that would follow from
the manner in which the Company expects, at the reporting date, to recover or settle the
carrying amount of its assets and liabilities.

Deferred tax assets and liabilities are offset only if:

a) The Company has a legally enforceable right to set off current tax assets against
current tax liabilities; and

b) The deferred tax assets and the deferred tax liabilities relate to income taxes levied by
the same taxation authority on the same taxable entity.

MAT (Minimum Alternate Tax) credit is recognised as an asset only when, and to the extent,
there is convincing evidence that the Company will pay normal income tax during the
specified period and the said is created by way of credit to the Statement of Profit and
Loss and shown as MAT credit entitlement. The Company reviews carrying amount of MAT
credit at each reporting date and writes down the same to the extent that there is no longer
convincing evidence to the effect that the Company will pay normal income tax during the
period.

s. Earnings per Share

Basic earnings per share are computed by dividing the net profit / (loss) after tax by the
weighted average number of equity shares outstanding during the year. Diluted earnings per
share is computed by dividing the net profit / (loss) after tax as adjusted for dividend, interest
and other charges to expense or income (net of any attributable taxes) relating to the dilutive
potential equity shares, by the weighted average number of equity shares outstanding during
the year adjusted for the effect of all dilutive potential equity shares.

t. Dividend

The Company recognises a liability for any dividend declared but not distributed at the end of
the reporting period, when the distribution is authorised and the distribution is no longer at the
discretion of the Company on or before the end of the reporting period. As per Corporate laws
in India, a distribution is authorized when it is approved by the shareholders. A corresponding
amount is recognised directly in other equity.

u. Segment Reporting

Operating Segments are reported in a manner consistent with the internal reporting provided
to the Chief Operating Decision Maker (CODM) which is a single business segment in Fine
Chemicals.

v. Events after reporting date

Where events occurring after the balance sheet date provide evidence of conditions that existed
at the end of the reporting period, the impact of such events is adjusted within the financial
statements. Otherwise, events after the balance sheet date of material size or nature are only
disclosed.

4.2 The Company has carried out valuation of said property as on June 7, 2024 amounting to ' 950 lakh.
In the opinion of the management there is no major change in the fair value of the property as on
March 31, 2025.

4.3 Direct operating expenses arising from investment property that did not generate rental income
during the year amount to ' 0.21 lakh (2023-24: ' 0.50 lakh).

4.4 Fair Value Hierarchy

The fair value of investment property had been determined by external independent property valuer,
having appropriate recognised professional qualification and experience in the location and category
of the property being valued.

The fair value measurement for investment property has been categorised as Level 2 based on inputs
to the valuation technique used.

4.5 Description of valuation technique used.

The Company had obtained independent valuation of its investment property as at June 7, 2024. There
has been no material movement in fair value of investment property. The fair value of the investment
property had been derived using 'Market approach method'. Under this approach, Comparative
method entails making valuations by directly comparing the properties under consideration with
comparable properties which have been sold recently after proper selection of comparable and after
making necessary allowance "plus and Minus" factor.

6.1 The Company had invested ' 56.01 lakh (March 31, 2024 : ' 56.01 lakh) in the share capital of Solentus
North America Inc., its wholly owned subsidiary company (“the subsidiary”). The Company has
decided to close the said subsidiary and has initiated the process of closure, which is delayed due to
technical reasons. Consequently, the Company has made full provision for impairment in the value of
said investment.

6.2 Includes ' 115.31 lakh (March 31, 2024: ' 115.31 lakh) towards fair value of financial guarantees issued
to a Bank in relation to loan availed by Dresen Quimica S.A.P.I. de C.V. 50,820,277 Equity Shares of
Dresen Quimica are pledged in respect of the aforesaid loan.

6.3 Includes ' 125.33 lakh (March 31, 2024: ' 125.33 lakh) towards fair value of financial guarantees issued
to a Bank in relation to loan availed by CFS Europe S.p.A.

6.4 ' 6.86 lakh (March 31, 2024: ' 6.86 lakh) is towards fair value of employee stock options under CFS
Employee Stock Option Scheme, 2018 (ESOP 2018) given to an employee of Industrias Petrotec de
Mexico S.A. de C.V. (Refer Note 21.4).

6.5 ' 6.87 lakh (March 31, 2024: ' 6.87 lakh) towards fair value of employee stock options under CFS
Employee Stock Option Scheme, 2018 (ESOP 2018) given to an employee of CFS Wanglong Flavours
(Ningbo) Co. Ltd. (Refer Note 21.4).

6.6 The Company had participated in 50,000 shares of CFS De Mexico Blends S.A.P.I.DE C.V. (CFS Blends)
its wholly owned subsidiary for which the subscription was not remitted.

The cost of investment included ' 126.58 lakh (March 31, 2024'126,58 lakh) towards fair value of
financial guarantees issued to a Bank in relation to loan availed for acquisition of 33.5% stake in
Dresen Quimica. The aforesaid 50,000 shares of CFS Blends & 50,820,277 equity shares of Dresen
Quimica held by the Company were pledged in respect of the loan.

The reverse merger of CFS Blends with its subsidiary Dresen Quimica with effect from February 28,
2025 was approved on May 21, 2025 by the concerned authorities.

With effect from February 28, 2025, CFS Blends ceased to be the subsidiary of the Company as it
was reversed merged into Dresen Quimica. Consequent to this reversed merger, the shareholding
in CFS Blends were extinguished and no new shares were issued by Dresen Quimica resulting in
Dresen Quimica becoming the wholly owned subsidiary of the Company with effect from February
28, 2025. Even though, the equity shares held by CFS Blends in Dresen Quimica were extinguished,
the shareholding of 50,820,277 shares and the equity capital of MXP 77,013,270 of Dresen Quimica
by the Company remained unchanged. Pursuant to which the cost of investments of CFS Blends
amounting to ' 126.58 has been subsumed in the cost of Dresen Quimica.

The said shareholding in Dresen Quimica is pledged as a security for loan borrowed by Dresen Quimica
alongwith a total corporate guarantee of USD 11.18 million.

6.7 There are no operations in the CFS PP(M) SDN. BHD till date. No amount towards subscription of
shares has been remitted as on March 31, 2025.

6.8 Fine Renewable Energy Limited had filed an application with the Registrar of Companies under
Section 248 of the Companies Act, 2013 for removal of its name from the Register of Companies. The
said application has been approved, and the name of the company has been accordingly struck off
from the Register on June 26. 2024.

7.1 The loan to subsidaries have been made for general corporate purpose of each subsidary.
These loans are given at rates comparable to the average commercial rate of interest and in
compliance with the provision of Companies Act, 2013.

7.2 No loans are due from Directors or other officers of the Company either severally or jointly
with any other person or amount due by firms or private companies in which any director is a
partner, a director or a member.

7.3 The Company had given loans of ' 242.27 lakh (' 242.27 lakh including interest of ' 53.09 lakh
(Refer Note 17) to Solentus North America Inc., its wholly owned subsidiary company. The
Company has made full provision for the said loans and advances.

11.1 Refer Note 22.1.(a) - 22.1 (g) , 25.1 and 25.2 for information on inventories pledged as security for
borrowings.

11.2 The above amounts are net of provision in respect of write down towards slow moving and
non moving inventories amounting to ' 356.37 lakh (2023-2024: ' 515.91 lakh ). These are
appropriately recognised under Note 32, Note 33 and Note 37.

11.3 The amounts are net of provision in respect of write down of inventories of Catechol and
downstream products to net realisable value amounting to ' 57.22 lakh (2023-2024: ' 3,681.08
lakh). These are recognised as an expense under Note 32 and Note 33.

12.1 The Company has entered into a Share Purchase Agreement dated February 24, 2025 with
certain shareholders of Vinpai SA France, the ordinary shares of which are listed on the Euronext
Growth Market of Euronext in Paris, to acquire its 2,723,316 ordinary equity shares of face value
of Euro 0.10 at a consideration of Euro 3.60 per share, being 78.68% stake of Vinpai SA. The total
consideration of Euro 9.80 million for the acquisition will be made by swap of fresh equity shares
issued by the Company after completion of the procedure as per the extant statutory guidelines.

Company has also subscribed to 3,300 Listed secured convertible bonds of Euro 1000 each
of Vinpai SA amounting to Euro 3.3 million (' 3,052.5). These bonds carry an option to the
subscriber to convert it into 1,100,000 equity shares each at a price of Euro 3 per equity share
within six months of the issue of bonds. In case of redemption of these bonds they will carry a
coupon of 1%. This instrument is measured at fair value through Profit and Loss as on the date
of financial statement.

13.3 Details of loss allowance

The Company has used practical expedient by computing expected credit loss allowance for
trade receivables (excluding subsidiaries) by taking into consideration historical credit loss
experience and adjusted for forward looking information. The expected credit loss is calculated
on the basis of ageing of the days, the receivables are due and the expected credit loss rate.
The movement in loss allowance is as follows:

d) Rights, preferences and restrictions attached to Equity Shares

The Company has only one class of shares having par value of ' 1 per share. Each holder of
Equity Shares is entitled to one vote per share. The Company declares and pays dividends in
Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of the
shareholders in the ensuing Annual General Meeting. In the event of liquidation of the Company,
the holders of Equity Shares are eligible to receive the remaining assets of the Company after
distribution of all preferential amounts, in proportion to their shareholding.

f) Shares reserved for issue under options outstanding as at the end of the year on un-issued
share capital:

i) Employee Stock Option Scheme, 2018: 10,60,275 options (March 31, 2024: 10,60,275) pertains to
un-issued shares as at March 31, 2025 (Refer Note 37.2.2).

ii) Employee Stock Option Scheme, 2020: 43,57,500 options (March 31, 2024: 43,87,500) pertains
to un-issued shares as at March 31, 2025 (Refer Note 37.2.1).

iii) Employee Stock Option Scheme, 2021: 45,00,000 options (March 31, 2024 : 45,00,000) pertains
to un-issued shares as at March 31, 2025 (Refer Note 37.2.3).

g) Terms of any securities converted into equity shares issued along with earliest date of
conversion

i) As at March 31, 2023, the Company had 10,258,986 Equity Shares reserved towards conversion
of FCCBs (Refer Note 21.1 for terms of Foreign Currency Convertible Bonds) at a conversion
price of ' 105 per share. The FCCBs were converted on May 12, 2023 and 10,258,986 fully paid-up
Equity Shares of face value of ' 1 per equity share were issued.

i) Increase in Authorised Share Capital

The Board of Directors of the Company and the Shareholders at their respective meetings
held on September 10, 2024 and October 18, 2024, approved the increase in Authorised
Capital of the Company to ' 21,50,00,000/- (21,50,00,000 equity shares of ' 1 only each ) from
' 18,00,00,000/- (18,00,00,000 equity shares of ' 1 only each).

j) Capital Raised through Rights Issue

On November 22, 2024, the Board of Directors of the Company, approved the rights
issue of equity shares for an amount upto ' 2,25,00,00,000/-. Pursuant to it, the Securities
Issue and Allotment Committee of the Board at its meeting held on January 8, 2025
declared a rights issue of 2,04,26,244 equity shares of ' 1 only each for a subscription of
' 110 per share (along with a share premium of ' 109 per equity share) aggregating to
' 2,24,68,86,840/- for a right entitlement of 5 right equity shares for 41 equity shares.
The Securities Issue and Allotment Committee of the Board at its meeting held on January 31,
2025, took on record the Basis of Allotment and approved the allotment of 2,04,25,805 Rights
Equity Shares to successful applicants for a total amount of ' 2,24,68,38,550. The aforesaid
allotment does not include the entitlements of 439 Rights Equity Shares which have been kept in
abeyance. Basic and Diluted EPS are recalculated to give effect of the rights issue in all reporting
periods in accordance with IND AS 33 (Earnings Per Share).

k) Shares in abeyance out of the Right Issue made during the year

The right entitlement of 439 equity shares relating to original holding of 3600 equity shares of
one of the shareholders has been kept in abeyance due to the legal dispute of the ownership
of the shareholder. The shares against this right entitlement will be issued on resolution of the
dispute.

l) Utilization of Rights Issue Proceeds

During the year ended March 31, 2025, the Company raised ' 224,68.39 lakh through a rights
issue of equity shares at ' 110 per share. The proceeds of the rights issues including interest
earned of ' 61.84 lakh were utilised in accordance with the letter of offer and the details are forth
below:

NATURE AND PURPOSE OF RESERVES:

21.1 Equity component of Foreign Currency Convertible Bonds (FCCBs)

At the time of initial recognition, FCCBs issued by the Company are split into equity and liability
component and presented under other equity and non-current financial liabilities respectively.

21.2 Capital Reserve

Capital Reserve comprises of amount received pursuant to preferential share warrants forfeited
by the Company on account of warrants not exercised by the allottees.

21.3 Securities Premium

i. The Securities premium account has been created to record the premium on issue of Equity
Shares.

ii. Securities premium has been utilized to offset expenses incurred in connection with the
Rights Issue, in accordance with the provisions of Section 52 of the Companies Act, 2013

21.4 Employee Stock Option Outstanding

The Company has Employee Stock Option Scheme / Plan under which options to subscribe to
the Company's shares have been given to certain employees of the Company. This reserve is
used to recognise the value of equity settled share based payments provided to the employees,
including Key Management Personnel, as a part of their remuneration.

The addition to Employee Stock Options Outstanding during the year is on account of CFS
Employees' Stock Option Scheme, 2018 and CFS Employees' Stock Option Plan, 2020.

21.5 General Reserve

General Reserve is created from time to time by way of transfer of profits from Retained Earnings.

21.6 Effective Portion of Cash Flow Hedges

The Company uses foreign exchange forward contracts as part of its risk management policy
for managing foreign currency risk. The effective portion of change in the fair value of forward
contracts classified as cash flow hedges is recognised in other comprehensive income and
accumulated in other equity under cash flow hedge reserve.

21.7 Reserve on conversion of FCCBs

On May 11, 2023, International Finance Corporation exercised its option to convert the
Foreign Currency Convertible Bonds (FCCBs) amounting to USD 15 million into 10,258,986
equity shares of face value of ' 1 only each of the company at the conversion price of ' 105
per equity share which were allotted on May 12, 2023. As per the provisions of IND AS 32 -
Financial Instruments, the amortised value of the FCCBs of ' 13,280.89 lakh and the fair value
of the derivative of ' 839.28 lakh both as on May 12, 2023, have been recognised as follows:

a) ' 102.59 lakh being 10,258,986 equity shares of ' 1 only each under 'Equity Share Capital',

b) ' 10,669.35 lakh being 10,258,986 equity shares of ' 104 each under 'Securities Premium
Account' and

c) The balance amount of ' 1,669.67 lakh under 'Reserve on conversion of FCCBs' under Other
Equity.

22.1 Term Loans from Banks in Rupees - Secured

(a) During the financial year, The company has repaid the entire loan Including prepayment
amounting to ' 404.70 lakh. As per original terms, the loan was repayable in remaining 24
monthly instalments by March 2026. (March 31, 2024: ' 747.35 lakh) secured by first pari passu
charge by way of hypothecation of inventories and book debts of the Company along with other
working capital lenders. Further secured by first pari passu charge by an equitable mortgage on
entire movable and immovable fixed assets of the Company, both present and future, excluding
assets charged exclusively to other lenders. The interest rate was at a spread of 60 basis points
over 1 year EBLR.

(b) During the financial year, The company has repaid the entire loan Including prepayment
amounting to ' 188.33 lakh. As per original terms, the loan was repayable in remaining 27 monthly
instalments by June 2026. (March 31, 2024: ' 317.81 lakh) secured by first pari passu charge by
way of hypothecation of inventories and book debts of the Company along with other working
capital lenders. Further secured by first pari passu charge by an equitable mortgage on entire
movable and immovable fixed assets of the Company, both present and future, excluding assets
charged exclusively to other lenders. The interest rate was at a spread of 100 basis points over
1 year MCLR.

(c) During the financial year, The company has repaid the entire loan Including prepayment
amounting to ' 407.40 lakh. As per original terms, the loan was repayable in remaining 23
monthly instalments by February 2026. (March 31, 2024: ' 773.78 lakh) secured by first pari
passu charge by way of hypothecation of inventories and book debts of the Company. Further
secured by first pari passu charge by an equitable mortgage on entire movable and immovable
fixed assets of the Company, both present and future, excluding assets charged exclusively to
other lenders. The interest rate was at a spread of 100 basis points over 6 months MCLR.

(d) During the financial year, The company has repaid the entire loan Including prepayment
amounting to ' 97.40 lakh. As per original terms, The loan was repayable in remaining 28 monthly
instalments by July 2026 (March 31, 2024: ' 160.42 lakh) secured by first pari passu charge by
way of hypothecation of inventories and book debts of the Company. Further secured by first
pari passu charge by an equitable mortgage on entire movable and immovable fixed assets of
the Company, both present and future, excluding assets charged exclusively to other lenders.
The interest rate was at a spread of 100 basis points over 1 year MCLR.

(e) ' 317.00 lakh (March 31, 2024: ' 317.00 lakh) secured by first pari passu charge by way of
hypothecation of inventories and book debts of the Company. Further secured by first pari
passu charge by an equitable mortgage on entire movable and immovable fixed assets of the
Company, both present and future, excluding assets charged exclusively to other lenders. The
loan is repayable in 48 monthly instalments by April 2029 commencing after a moratorium
period of two years from the date of first disbursement. The current interest rate is at a spread
of 75 basis points over 1 year MCLR, subject to maximum 9.25% p.a.

(f) ' 1,106.48 lakh (March 31, 2024: ' 1,104.06 lakh) secured by first pari passu charge by way of
hypothecation of inventories and book debts of the Company. Further secured by first pari
passu charge by an equitable mortgage on entire movable and immovable fixed assets of the
Company, both present and future, excluding assets charged exclusively to other lenders. The
loan is repayable in 48 monthly instalments by February 2029 commencing after a moratorium

period of two years from the date of first disbursement. The current interest rate is at a spread
of 100 basis points over 6 months MCLR, subject to maximum 9.25% p.a.

(g) ' 978.00 lakh (March 31, 2024: ' 978.00 lakh) secured by first pari passu charge by way of
hypothecation of inventories and book debts of the Company. Further secured by first pari
passu charge by an equitable mortgage on entire movable and immovable fixed assets of the
Company, both present and future, excluding assets charged exclusively to other lenders. The
loan is repayable in 48 monthly instalments by April 2029 commencing after a moratorium
period of two years from the date of first disbursement. The current interest rate is at a spread
of 100 basis points over 1 year MCLR, subject to maximum 9.25% p.a.

(h) ' 93.24 lakh (March 31, 2024: ' 121.89 lakh) secured by way of hypothecation of vehicle. The loan
is repayable in remaining 30 monthly instalments by September 2027. The current interest rate
is 8.05% p.a.

(i) ' 16.39 lakh (March 31, 2024: ' 23.14 lakh) secured by way of hypothecation of vehicle. The loan
is repayable in remaining 26 monthly instalments by May 2027. The current interest rate is 7.25%
p.a.

(j) ' 31.39 lakh (March 31, 2024: ' 39.18 lakh) secured by way of hypothecation of vehicle. The loan is
repayable in remaining 40 monthly instalments by July 2028. The current interest rate is 8.70%
p.a.

22.2 Term Loans from others- Secured

(a) In Foreign Currency

i) ' 9,573.81 lakh (March 31, 2024: ' 11,352.57 lakh) secured by first pari passu charge over
entire movable and immovable fixed assets at Plot No. Z/96/D at Dahej SEZ. The loan is
repayable in remaining 9 semi-annual instalments by July 2029. The current interest rate is
at spread of 443 basis points over 6 months SOFR.

ii) ' 9,942.63 lakh (March 31, 2024: ' 9,890.81 lakh) secured by first pari passu charge over
entire movable and immovable fixed assets at Plot No. Z/96/D at Dahej SEZ. The loan is
repayable from April 2025 in 24 structured quarterly instalments by January 2031. The
current interest rate is at a spread of 500 basis points over 3 months SOFR (Including
additional 100 basis points as per terms and conditions).

(b) In Rupees

Non-Convertible Bonds amounting ' 10,000 lakh borrowed on December 5,2024 were
repaid on February 12, 2025 which were secured by residual charge over all current assets
and movable fixed assets (present and future). As per the original terms, the loan was
repayable in 13 months that is by January 4, 2026. The interest rate was 16%.

25.1 Loans repayable on demand from banks - Secured

' 18,745.91 lakh (March 31, 2024: ' 19,203.96 lakh) on account of working capital facilities availed
from banks and are secured by first pari passu charge over Company's current assets, both
present and future. Further, secured by first pari passu charge by an equitable mortgage on the
entire movable and immovable fixed assets of the Company, both present and future, excluding
assets exclusively charged to other lenders. The said working capital facilities are additionally
guaranteed by Mr. Ashish Dandekar, Promoter, Chairman & Managing Director of the Company.
The current interest rates range from 8.9% to 12.50% p.a.

25.2 Other Short Term Borrowings from banks - Secured

(a) ' Nil (March 31, 2024: ' 703.16 lakh) towards buyers credit availed from banks and is secured
by security stated against Note 25.1

(b) ' 426.84 lakh (March 31, 2024: ' 106.64 lakh) towards Bill Discounting availed from banks
and is secured by security stated against Note 25.1

25.3 Other Short Term Borrowings from others- Unsecured

(a) ' 2,469.98 lakh (March 31, 2024: ' 2,161.79 lakh) towards purchase bill discounting availed
from a financial institution. The current interest rate ranges from 10.50% to 11.00% p.a.

(b) ' 479.96 lakh (March 31, 2024: ' 745.89 lakh) towards purchase and service bill discounting
from various banks registered under TReDS platform. The current interest rates are in the
range of 7.75% p.a. to 8.50% p.a.

(c) ' Nil (March 31, 2024: ' 414.94 lakh) towards purchase and service bill discounting from
various banks registered under TReDS platform. The current interest rate is in the range of
8.19% p.a. to 9 % p.a

25.4 The Company does not have any charges which are yet to be registered with the Registrar
of Companies (ROC) beyond the statutory period. Further, no certification in relation to the
satisfaction of charge received from the banks are pending for submission with ROC.

25.5 The Company has submitted stock statements, debtors statements and other information
/ returns as required by the banks on a monthly as well as quarterly basis. Such monthly /
quarterly statements and returns are generally in agreement with the books of account except
for differences in some cases on account of valuation, provisions etc, the impact of which is not
material.

30.2 The amounts receivable from customers become due after expiry of credit period which ranges
between 15 to 120 days. There is no significant financing component in any transaction with the
customers.

30.3 The Company does not have any remaining performance obligation as contracts entered for sale
of goods are for a short duration.

30.4 Revenue from sale of products includes loss of ' 151.10 lakh (2023-24: Gain ' 75.15 lakh) pertaining
to effective portion of changes in fair value of foreign exchange forward contracts classified as
cash flow hedges.

34.1 Employee Benefit Plans

(a) Other long term employment benefits

Leave encashment is payable to the employees of the Group due to death, retirement,
superannuation or resignation. Employees are entitled to encash leave while in service. The leave
encashment benefit is payable to all the eligible employees of the Group at the rate of daily
salary as per current accumulation of leave days.

The Privilege Leave encashment liability and amount charged to Consolidated Statement of
Profit and Loss determined on actuarial valuation using projected unit credit method are as
under:

(b) Defined Contribution Plans:

The contributions to the Provident Fund of eligible employees are made to a Government
administered Provident Fund and there are no further obligations beyond making such
contribution. Under the plan, the Group has contributed ' 349.22 lakh during the year (2023¬
2024: ' 338.77 lakh).

(c) Defined Benefit Plans:

The Group makes contributions to the Group Gratuity cum Life Assurance Scheme administered
by the Life Insurance Corporation of India, a funded defined benefit plan for qualifying employees.
On retirement / resignation, the Scheme provides for payment as per the provisions of Payment
of Gratuity Act, 1972 with vesting period of 5 years of service. On death / permanent disablement
in service, vesting period is not applicable.

The most recent actuarial valuation of plan assets and present value of defined benefit obligation
of gratuity was carried out as at March 31, 2025. The present value of defined benefit obligation
and the related current service cost and past service cost were measured using the Projected
Unit Credit Method. The following table summaries the net benefit expense recognised in the
Consolidated Statement of Profit and Loss, the details of the defined benefit obligation and the
funding status of the gratuity plans:

39 CORPORATE SOCIAL RESPONSIBILITY

The Company has spent ' 35 lakh during the financial year (2023-2024: ' 88 lakh) as per the provisions
of Section 135 of the Companies Act, 2013 read with Schedule VII thereof, towards Corporate Social
Responsibility (CSR) activities.

a) Gross amount required to be spent by the Company during the year - ' 35 lakh (2023-2024:
' 88 lakh)

c) Nature of CSR activities during the year

The Company operates CSR Policy in the areas of promoting healthcare, education including
special education and employment enhancing vocation skills especially among children, the
differently abled, tribal communities and measures for reducing inequalities faced by socially
and economically backward classes. The projects identified and adopted are as per the activities
included and amended from time to time in Schedule VII of the Companies Act, 2013.

During the year, the Company has spent the entire amount of ' 35 lakh towards CSR activities
through NGO operating in the said areas.

40 Exceptional Item

The exceptional Items, expense (net) recognised in Profit and Loss for the year ended March 31,

2025 includes:

i) Impairment loss on investments in subsidiaries namely:

a. CFS Europe ' 1,178.56 Lakh ( March 31, 2024 ' NIL)

b. CFSWL ' 436.92 Lakh ( March 31, 2024'192.84 Lakh)

c. CFS Pahang Asia Pte Ltd. ' 17.89 Lakh ( March 31, 2024 ' NIL)

ii) Impairment of trade and other receivables (net of payables) due from subsidiaries:

a. CFS Europe SpA ' 1,929.04 Lakh ( March 31, 2024 ' NIL)

b. CFSWL ' 5,941.52 Lakh ( March 31, 2024 ' NIL)

iii) Loss on demolition / refurbishment of assets (net of scrap sale) ' 96.28 Lakh (March 31, 2024
' Nil).

41 EARNINGS PER SHARE

a) Basic Earnings Per Share

The calculation of basic earnings per share is based on the (Loss)/ Profit attributable to ordinary
shareholders and weighted average number of ordinary shares outstanding.

--- --- Ý*----------------— ^m3----^-------/

43.1 Pursuant to the directions of the Honorable Supreme Court dated December 14, 2020, National
Green Tribunal had reheard the matter and vide its direction dated January 24, 2022 had
enhanced the portion of compensation attributable to the Company for alleged violations of
environmental norms by manufacturers at Tarapur MIDC for an amount of ' 1,712.31 lakh from
' 515.56 lakh. The Honorable Supreme Court vide its order dated April 27, 2022 has stayed
the proceedings of the aforesaid directions until the matter is heard. Further the Honorable
Supreme Court has directed to deposit ' 515.56 lakh until the matter is heard. The Company has
deposited ' 154.97 lakh which is disclosed as recoverable advance (Refer Note 18.2). Based on
the assessment of the management, the Company believes that it has strong grounds to defend
its position against these directions and hence no provision for the compensation is considered
necessary in the financial statements.

43.2 There are numerous interpretative issues relating to the Supreme Court judgements on Provident
Fund dated February 28, 2019. As a matter of caution, the Company has made an adequate
provision on a prospective basis from the date of the Supreme Court Order and the provisions
will be updated on receiving further clarity on the subject.

b) Fair value hierarchy (Refer Note B to material accounting policies)

c) Measurement of Fair Value

The fair values of financial assets or liabilities are included at the amount 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. Methods and assumptions used to estimate the fair values are consistent
in both years. The following methods and assumptions are used to estimate the fair values:

(i) The Management assesses that fair values of trade receivables, cash and cash equivalents,
other bank balances, loans, trade payables, current borrowings and other financial liabilities
(current), approximate to their carrying amounts largely due to the short-term maturities
of these instruments. The Company does not anticipate that the carrying amount would be
significantly different from the values that would eventually be received or settled.

(ii) The fair value of forward contracts for the remaining maturity period of the contracts is
determined using Mark-to-Market report provided by the Company's bankers.

(iii) The Company investments in bonds measured at fair value, orignal investment value of
' 3,052.5 lakh (March 31, 2024 NIL). These instruments are categorized as Level 1 under the
fair value hierarchy (Refer Note 12.1).

d) Risk Management Framework

The Company's business activities expose it to a variety of financial risks, namely credit risk,
liquidity risk and market risks. Market risks comprise of currency risk and interest rate risk. The
Company's Senior Management and Key Management Personnel have the ultimate responsibility
for managing these risks. The Company has a process to identify and analyse the risks faced by
the Company, to set appropriate risk limits, to control and monitor risks and adherence to these
limits. Risk Management policies and systems are reviewed regularly to reflect changes in market
conditions and Company's activities. Further, Audit Committee undertakes regular reviews of
Risk Management Controls and Procedures.

(i) Credit Risk

Credit risk is the risk that a customer or counterparty fails to meet its contractual obligations
resulting in financial loss to the Company. The Company is exposed to credit risk from
its operating activities (trade receivables) and from its financing activities including
investments in mutual funds, deposits with banks and financial institutions and financial
instruments.

Trade Receivables

Credit risk from trade receivables is managed by establishing credit limits, credit approvals
and monitoring creditworthiness of the customers. Outstanding customer receivables are
regularly monitored. The Company has computed credit loss allowances based on Expected
Credit Loss Model, which excludes transactions with subsidiaries.

Term Deposits and Bank Balances

The Company's exposure in term deposits with banks is limited, as the counterparties are highly
rated banks.

[ii) Liquidity Risk

Liquidity risk is the risk that the Company will face in meeting its obligations associated with its
financial liabilities. The Company's approach to managing liquidity is to ensure that it will have
sufficient funds to meet its liabilities when due without incurring unacceptable losses.

Tabulated below are the Company's remaining contractual maturities of financial liabilities as at
the reporting date with agreed repayment periods. The tables have been drawn up considering the
undiscounted contractual cash flows of financial liabilities based on the earliest date on which the
Company can be required to pay. The table includes both interest and principal cash flows.

*The amounts included above for financial guarantee contracts are the maximum amounts the
Company could be forced to settle under the arrangement for the full guaranteed amount if that
amount is claimed by the counterparty to the guarantee. Based on expectations at the end of the
reporting period, the Company considers that it is more likely than not that such an amount will not
be payable under the arrangement.

(iii) Currency Risk

The Company's operations result in it being exposed to foreign currency risk on account of trade
receivables, trade payables, borrowings and lendings. The foreign currency risk may affect the
Company's income and expenses, or its financial position and cash flows. The objective of the
Company's Management of foreign currency risk is to maintain these risk within acceptable parameters,
while optimising returns.

The Company's exposure to foreign currency risk denominated monetary assets and liabilities at the
end of the reporting period expressed in ' (in lakh), is as follows:

Cash flow sensitivity analysis for variable-rate instruments

A reasonably possible change of 100 basis points in interest rate with other conditions remaining
unchanged would have the following effect on Company's profit or loss before tax and equity for the
year ended March 31, 2025 and March 31, 2024. This calculation assumes that the change occurs at
the balance sheet date and has been calculated based on risk exposures outstanding as at that date.
The year end balances are not necessarily representative of the average debt outstanding during the
period. The analysis assumes that all other variables, in particular foreign currency exchange rates
remains constant.

46 CAPITAL MANAGEMENT

The primary objective of the Company's capital management is to maintain an efficient capital
structure and to maximise shareholder's value. The Management seeks to maintain a balance
between higher returns that is achieved by raising funds through equity and the advantages by a
sound capital position.

The Company monitors capital using a ratio of 'Net Debt to Equity'. For this purpose, Capital includes
issued capital and all other equity reserves. Net Debt is defined as total borrowings less cash & bank
balances.

47 DISCLOSURES U/S 186(4) OF THE COMPANIES ACT, 2013

a Details of investments made are disclosed in Note 6.

b Details of Loans given to subsidiaries, associates, firms/companies in which directors are
interested are disclosed in Note:16.1, 16.2 and 16.3.

c Details of Guarantee given on behalf are disclosed in Note: 43(I)(c).

48 DISCLOSuRES MADE IN TERMS OF SCHEDuLE V OF THE SEBI (LISTING OBLIGATION AND

disclosure requirements) regulations, 2015

For disclosure of loans, investments and Guarantee- 'Refer Note 47'. Further, there is no investment
in shares of the Company by the parties to whom loan have been given.

50 ADDITIONAL REGULATORY INFORMATION

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

b) The Company has not been declared as wilful defaulter by any lender who has the powers to
declare a company as wilful defaulter at any time during the financial year or after the end of the
reporting period but before the date when financial statements are approved.

c) The Company has complied with the number of layers prescribed under clause 87 of section 2
of Companies Act, 2013 read with Companies (Restriction on number of Layers) Rules, 2017.

d) The Company does not have any approved scheme of Arrangement during the year.

e) 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;

(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.

f) The Company has not received any funds from any person(s) or entity(ies), including foreign
entities (Funding Party) with the understanding 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 to or on behalf of the Ultimate Beneficiaries.

g) The Company does not have any transaction not recorded in the books of account that has been
surrendered or disclosed as income during the year in the tax assessments under the Income Tax
Act, 1961.

h) The Company has not traded or invested in Crypto Currency or Virtual Currency during the
financial year.

51 Previous year's figures have been regrouped / reclassified wherever necessary to conform to current
year's classification.