Provision for expected credit losses of trade
receivables

The Company uses a provision matrix to calculate ECLs for trade
receivables. The provision rates are based on days past due for
groupings of various customer segments that have similar loss patterns

The provision matrix is initially based on the Company's historical
observed default rates. The Company will calibrate the matrix to
adjust the historical credit loss experience with forward-looking
information. At every reporting date, the historical observed
default rates are updated and changes in the forward-looking
estimates are analysed.

The assessment of the correlation between historical observed
default rates, forecast economic conditions and ECLs is a
significant estimate. The amount of ECLs is sensitive to changes
in circumstances and of forecast economic conditions. The
Company's historical credit loss experience and forecast
of economic conditions may also not be representative of
customer's actual default in the future.

Share-based payments

For the measurement of the fair value of equity-settled
transactions with employees at the grant date, the Company
uses a DCF model for Employee Share Option Plan. The
assumptions and models used for estimating fair value for share-
based payment transactions are disclosed in note 29.

Defined benefit plans (gratuity benefits)

The cost of the defined benefit gratuity plan and other post¬
employment benefits 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.

Fair value measurement of financial instruments

When the fair value of financial assets and liabilities recorded in
the balance sheet cannot be measured based on quoted prices
in active markets, their fair value is measured using valuation
techniques including the discounted cash flow (DCF) model.
The inputs to these models are taken from observable markets
if available, otherwise, a degree of judgement is required in
establishing fair values. Judgements include considerations of
inputs such as liquidity risk, credit risk and volatility. Changes
in assumptions about these factors could affect the reported fair
value of the financial instrument.

2.3 Changes in accounting policies and disclosures

The Ministry of Corporate Affairs vide notification dated
9 September 2024 and 28 September 2024 notified the
Companies (Indian Accounting Standards) Second Amendment
Rules, 2024 and Companies (Indian Accounting Standards)
Third Amendment Rules, 2024, respectively, which amended/
notified certain accounting standards (see below), and
are effective for annual reporting periods beginning on or
after 1 April 2024:

• Insurance contracts - Ind AS 117; and

• Lease Liability in Sale and Leaseback - Amendments
to Ind AS 116

These amendments did not have any material impact on the
amounts recognised in prior periods and are not expected to
significantly affect the current or future periods.

3.1 Property, plant and equipment (PPE) (Contd..)

ii. Buildings include those constructed on leasehold land.

iii. Title deeds of all the immovable properties (other than properties where the Company is the lessee and the lease arrangements are
duly executed in favour of the lessee) are held in the name of the Company.

iv. The Company has not revalued its property, plant and equipment (including right-of-use assets) or intangible assets or both during the
current or previous year.

v. The Capital work in progress (CWIP) consists of construction of building and expenditure towards plant and machinery at its
manufacturing facilities.

vi. Refer note 30 for disclosure of contractual commitments towards acquisition of Property, plant and equipment and intangible assets.

As at March 31, 2025, the carrying amount of goodwill is H 3,055.20 lakhs (March 31, 2024: H 3,055.20) (deemed cost as at April 01,
2019). Such goodwill arose as part of the business purchase and merger of Hi-Build Coating Private Limited (HBC) pursuant to the composite
scheme of amalgamation approved by National Company Law Tribunal (""NCLT"") vide its order dated March 02, 2017 (Appointed date:
April 01, 2016). For the purpose of impairment testing of Goodwill, as per the business plan of purchase, the entire business of the Company
is considered as single Cash Generating Unit (CGU), as post business combination the entire operations of the Company have been
integrated for synergies, includes aligning of manufacturing facilities, logistics management, technology exchange, etc.

The Company performs impairment testing annually. The recoverable amount of the CGU has been determined based on a value in use
calculation using cash flow projections from financial budgets approved by the management covering a five year period. The pre-tax
discount rate applied to cash flow projections for impairment testing during March 31, 2025: 10% (March 31, 2024: 10%). Based on the
cash flow projections, discount rate and other assumptions including gross margin, sales discount, market share, volume growth, etc it was

concluded that the value in use exceeds the carrying value of goodwill and overall CGU. As at March 31, 2025, there were no indicators
of impairment noted by management.

The Company constantly monitors the latest government legislation in relation to climate-related matters. At the current time, no legislation
has been passed that will impact the Company. The Company will adjust the key assumptions used in value-in-use calculations and
sensitivity to changes in assumptions should a change be required.

C. Terms and rights attached to the equity shares:

The Company has only one class of equity shares having a par value of H 10 per share (March 31, 2024: H 10). Each holder of equity
shares is entitled to one vote per share. In the event of liquidation of the Company, the holders of equity shares will be entitled to
receive the remaining assets of the Company after distribution of the preferential amounts. The distribution of the remaining assets of
the Company will be in proportion to the number of equity shares held by the shareholders.

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 (refer note 12).

Nature and purpose of reserves:

Securities premium account - This represents the amount received in excess of par value of equity shares.

General reserve - Represents amounts transferred from retained earnings in earlier years as per the requirements of the erstwhile
Companies Act 1956.

Share based payment reserve - The share based payment reserve is used to recognise the grant date fair value of options issued to
employees under Employee stock option plan.

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

The entire amount of the provision of H 80.31 lakhs (March 31, 2024: H 138.43 lakhs) is presented as current, since the Company does
not have an unconditional right to defer settlement for any of these obligations. However, based on past experience, the Company
does not expect all employees to avail the full amount of accrued leave or require payment for such leave within the next 12 months.
This is an unfunded scheme.

The Company operates a defined benefit gratuity plan for its employees. Under the gratuity plan, every employee who has completed
five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service.
For certain class of employees, the gratuity will be paid at 30 days salary (last drawn salary) for each completed year of service post
their completion of 20 years of employment. The plan is funded with LIC by the Company.

The liability or asset recognised in the balance sheet in respect of defined benefit gratuity plans is the present value of the defined
benefit obligation at the end of the reporting period less the fair value of plan assets. The cost of providing benefits under the defined
benefit plan is determined using the projected unit credit method.

The following tables summarise the components of net benefit expense recognised in the Statement of Profit and Loss, the funded status
and amounts recognised in balance sheet for the plan.

iii. Risk Exposure

Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which are detailed below :
Asset Volatility:

The Plan liabilities are calculated using a discount rate set with reference to bond yields. If plan assets underperform, this yield will
create a deficit. The plan assets are maintained with fund manager LIC of India. They are subject to interest rate risk which is managed
by the insurer.

Changes in bond yield:

A decrease in bond yields will increase plan liabilities.

Asset risk:

All plan assets are maintained in a trust fund managed by a public sector insurer viz; Life Insurance Corporation (LIC) of India. LIC has
a sovereign guarantee and has been providing consistent and competitive returns over the years.

The Company has opted for a traditional fund wherein all assets are invested primarily in risk averse markets. The Company has no
control over the management of funds but this option provides a high level of safety for the total corpus. A single account is maintained
for both the investment and claim settlement and hence 100% liquidity is ensured. Also, interest rate and inflation risk are taken care of.

Future salary escalation and Inflation risks:

Rising salaries will often result in higher future defined benefit payments resulting in a higher present value of liabilities especially
unexpected salary increases provided at management's discretion may lead to uncertainties in estimating this risk.

Life expectancy:

Increases in life expectancy of employee will result in an increase in the plan liabilities. This is particularly significant where inflationary
increases result in higher sensitivity to changes in life expectancy.

Terms and conditions of related party transactions and balances:

Outstanding balances at the end of the year are unsecured and interest free and settlement occurs in cash.

The transactions with related parties (excluding relatives of KMPs) includes managerial remuneration which is determined based
on market conditions and is approved by Nomination and Remuneration Committee of the Company.

Share-based payments include the perquisite value of stock incentives exercised during the year, determined in accordance
with provisions of Income Tax Act, 1961.

In case of transactions with related parties during the year, the amounts are exclusive of applicable taxes.

The expected life of the share options is based on the historical data and current expectations and is not necessarily indicative of
exercise pattern that may occur. The expected volatility reflects the assumptions that the historical volatility over a period similar to the
life of the options is indicative of future trends, which may not necessarily be the actual outcome.

vi. Effect of the employee share-based payment plans on the Statement of Profit and Loss and on its
financial position

Compensation expense arising from equity-settled employee share based payment plans for the year ended March 31, 2025
amounted to H 601.01 lakhs (March 31, 2024: H 697.77 lakhs). The liability for employee stock options outstanding as at March 31,
2025 is H 1,730.34 lakhs (March 31, 2024: H 1,290.08 lakhs).

30 Capital and other commitments

i) The estimated amounts of contracts remaining to be executed on capital account and not provided for are H 13,428.39 lakhs (net of
advances: H 1,241.69 lakhs) [March 31, 2024: H 17,963.64 lakhs (net of advances: H 1,898.69 lakhs)]

ii) The Company has guaranteed purchase of certain quantities of tinting machine and gyro shakers. In the event the Company is not
able to make the purchases, it will be liable to compensate the manufacturer with a fee equivalent to the manufacturer's price towards
inventory of components including the customized front panel TAB, keyboard, mouse and USB hub with cabling.

iii) For commitments relating to lease arrangements, refer note 35.

33 Segment reporting

The Board of Directors of the Company performs the function of allotment of resources and assessment of performance of the Company.
Considering the level of activities performed, frequency of their meetings and level of finality of their decisions, the Company has identified
that Chief Operating Decision Maker function is being performed by the Managing Director. The financial information presented to the
Board and Managing Director in the context of results and for the purposes of approving the annual operating plan is on a consolidated
basis for various products of the Company. As the Company's business activity falls within a single business segment viz. 'Paints' and
the sales substantially being in the domestic market, the financial statements are reflective of the information required by Ind AS 108
"Operating Segments”.

For details on geographical distribution of revenue, refer note 18.

All non-current assets of the Company are located within India.

34 Operating leases

Operating lease - Company as lessor

The Company has given tinting machines and gyro shakers on operating lease to its dealers. The Company enters into 5 years cancellable
lease agreements. The minimum aggregate lease payments to be received in future is considered as H Nil. Accordingly, the disclosure
of minimum lease payments receivable at the Balance sheet date is not made. The amount received from the dealers in nature of non¬
refundable deposits (representing lease income received in advance) is deferred and amortised over the period of lease. The initial direct
cost relating to acquisition of tinting machines and gyro shakers is capitalised. The information on gross amount of leased asset, depreciation
and impairment is given in note 3.1(i).

35 Leases

A Company as a lessee

The Company has lease contracts mainly for land and buildings (godowns and depots) used for factory operations and storage of
goods. Leases of such depots /godowns generally have lease terms between 3 and 10 years. The Company's obligations under
its leases are secured by the lessor's title to the leased assets. Generally, the Company is restricted from assigning and subleasing
the leased assets.

35 Leases (Contd..)

The Company had total cash outflows for leases of H 882.09 lakhs in March 31, 2025 (H 718.98 lakhs in March 31, 2024).
The Company also had non-cash additions to right-of-use assets and lease liabilities of H 990.44 lakhs in March 31, 2025
(H 1,243.74 lakhs in March 31, 2024). The future cash outflows relating to leases are disclosed in note 38.

The Company has several lease contracts that include extension and termination options. These options are negotiated by management
to provide flexibility in managing the leased-asset portfolio and align with the Company's business needs. Management exercises
significant judgement in determining whether these extension and termination options are reasonably certain to be exercised.

There are no variable lease payment terms.

The total lease payment for the leasehold land rights for the lease period has already been made. Therefore the Company is not
required to create any corresponding liabilities.

ii) Fair value hierarchy

This section explains the judgements and estimates made in determining the fair values of the financial instruments that are recognised
and measured at fair value. To provide an indication about the reliability of the inputs used in determining fair value, the Company has
classified its financial instruments into the three levels prescribed under the accounting standard. An explanation of each level follows
underneath the table.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which
maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required
to fair value an instrument are observable, the instrument is included in level 2.

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.

There has been no transfer among Level 1, Level 2 and Level 3 during the year.

iii) Valuation technique used to determine fair value

The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction
between willing parties, other than in a forced or liquidation sale. The following methods and assumptions were used to estimate the fair values:

The fair values of the unquoted mutual funds and bonds are based on NAV obtained from asset management companies at the reporting date.

iv) Valuation process

The finance department of the Company includes a team that oversees the valuations of financial assets and liabilities required for
financial reporting purposes, including level 3 fair values.

External valuers are involved for valuation of significant assets, such as unquoted financials assets. Involvement of external valuers is decided by
the finance team. Selection criteria includes market knowledge, reputation, independence and whether professional standards are maintained.
The Finance team decides, after discussions with the Company's external valuers, which valuation techniques and inputs to use for each case.

Changes in level 3 fair values are analysed at the end of each reporting period during the valuation discussion between the valuation
team and external valuer. As part of this discussion the team presents a report that explains the reason for the fair value movements.

37 Capital management

The Company's objective for capital management is to maximise shareholders value, safeguard business continuity and support the growth of
the Company. The Company determines the capital requirements based on annual operating plans and long-term and other strategic investment
plans. The funding requirements are met through equity and operating cash flows generated. No changes were made in the objectives, policies or
processes during the year ended March 31, 2025. Capital represents equity attributable to equity holders of the Company. The Company monitors
capital using a gearing ratio, which is net debt/obligation divided by total equity. The Company's policy is to keep the gearing ratio optimum.

38 Financial risk management objectives and policies

The Company's principal financial liabilities comprise lease liabilities and trade payables and other payables. The main purpose of these
financial liabilities is to finance the Company's operations. The Company's principal financial assets include trade receivables and other
receivables, and cash and cash equivalents that are derived directly from its operations. The Company also holds investments in mutual funds.

The Company is exposed to market risk, credit risk, price risk, liquidity risk and interest risk. The Company's senior management oversees
the management of these risks. The Company's senior management ensures that the Company's financial risk activities are governed by
appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company's
policies and risk objectives. All derivative activities for risk management purposes are carried out by specialist teams that have the
appropriate skills, experience and supervision. The Managing Director and the Board of Directors review and agree policies for managing
each of these risks, which are summarised below.

(a) 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. Financial
instruments affected by market risk include deposits and investments.

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 Company is not exposed to the interest rate risk as there are no floating interest rates on financial assets and no
debt obligations.

(i) Price risk

The Company invests its surplus funds in mutual funds which are linked to equity/debt markets. The Company is exposed to
price risk for investments that are classified as fair value through profit and loss. To manage its price risk arising from investments
in mutual funds, the Company diversifies its portfolio. Diversification and investment in the portfolio is done in accordance with
Company's investment policy approved by the Board of Directors.

(ii) 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. Generally, the Company's exposure to the risk of changes in the market interest rates primarily relate to the
Company's debt obligations with the floating interest rates. The Company does not have any borrowings in the current year as
well as previous year.

(iii) Foreign currency risk

The company is engaged in international trade and thereby exposed to foreign exchange risk arising from foreign currency
transactions, primarily with respect to the USD and EUR. Foreign exchange risk arises from recognised assets and liabilities
denominated in a currency that is not the Company's functional currency (H). The Company's exposure to foreign currency arises
from short term receivables and payables where fluctuations in the foreign exchange rates are generally not significant and
consequently limiting the Company's exposure.

(b) 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 financing
activities, including investments, deposits with banks and financial institutions and other financial instruments.

(i) Trade receivables

Customer credit risk is managed by the Company's established policies, procedures and controls relating to customer credit
risk management. Credit quality of a customer is assessed based on an individual credit limits and are defined in accordance
with management's assessment of the customer. Outstanding customer receivables are regularly monitored. The concentration
of credit risk is limited due to the fact that the customer base is large. There is no customer representing more than 5% of the total
balance of trade receivables.

The Company uses a provision matrix to determine impairment loss allowance on portfolio of its trade receivables. The provision
matrix is based on its historically observed default rates over the expected life of the trade receivables and is adjusted for
forward-looking estimates. At every reporting date, the historical observed default rates are updated and changes in the
forward-looking estimates are analysed.

The ageing of trade receivable as on balance sheet date is given below. The age analysis has been considered from the date
when the invoices were due for payment.

Credit risk from balances with banks, mutual funds is managed by the management in accordance with the Company's policy.
Investments of surplus funds are made only with approved counterparties based on limits defined by the management. The limits
are set to minimise the concentration of risks and therefore mitigate financial loss through counterparty's potential failure to make
payments. The Company's maximum exposure to credit risk for financial instruments (mutual funds), bank balances and deposits
as at March 31, 2025 and March 31, 2024 is the carrying amounts as mentioned in note 4 and 8.

(c) Liquidity risk

Liquidity risk is the risk that the Company may encounter difficulty in meeting its present and future obligations associated with
financial liabilities that are required to be settled by delivering cash or another financial asset. The Company closely monitors
its liquidity position and deploys a robust cash management system. It aims to minimise these risks by generating sufficient
cash flows from its current operations, which in addition to the available cash and cash equivalents, will provide liquidity.
The liquidity risk is managed on the basis of expected maturity dates of the financial liabilities. The carrying amounts are assumed to
be reasonable approximation of fair value.

40 (i) New and amended standards

The Ministry of Corporate Affairs (MCA) vide notification dated 9 September 2024 and 28 September 2024 notified the Companies
(Indian Accounting Standards) Second Amendment Rules, 2024 and Companies (Indian Accounting Standards) Third Amendment
Rules, 2024, respectively, which amended/ notified certain accounting standards (see below), and are effective for annual reporting
periods beginning on or after 1 April 2024:

• Insurance contracts - Ind AS 117; and

• Lease Liability in Sale and Leaseback - Amendments to Ind AS 116

These amendments did not have any material impact on the amounts recognised in prior periods or current period and are not
expected to significantly affect the future periods.

(ii) Standard issued but not yet effective

MCA notifies new standards or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as
issued from time to time. During the year ended March 31, 2025, MCA has not notified any new standards or amendments to the
existing standards which are not yet effective.

41 Other statutory information:

(i) No proceedings have been initiated or are pending against the Company for holding any Benami property under the Prohibition of
Benami Property Transactions Act, 1988 (as amended from time to time) (formally the Benami Transaction (Prohibition) Act, 1988
(45 of 1988)) and Rules made there under.

(ii) The Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority.

(iii) The Company does not have any charges or satisfaction which is yet to be registered with Registrar of Companies (ROC) beyond the
statutory period.

(iv) The Company has not traded or invested in Crypto currency or Virtual Currency during the current or previous financial year.

(v) The Company has not advanced or loaned or invested funds (either borrowed funds or share premium or any other sources or kind
of funds) to any other person or entity, including foreign entities (Intermediaries) with the understanding (whether recorded in writing
or otherwise) that the intermediary shall:

(a) d irectly 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 has not received any funds from any person or entity, including foreign entities (Funding Party) with the understanding
(whether recorded in writing or otherwise) that the Company shall:

(a) d irectly 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 revalued its property, plant and equipment (including right-of-use assets) or intangible assets or both during the
current or previous year.

41 Other statutory information: (Contd..)

(viii) There were no payments made by the Company to political parties during current or previous year.

(ix) The Company does not have any borrowings from banks or financial institutions or government or government authorities or
any other lender.

(x) There are no loans and advances in the nature of loans granted to promoters, directors, key managerial personnel and related parties
as at March 31, 2025 and March 31, 2024.

(xi) The Company does not have any such transaction which is 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 (such as, search or survey or any other
relevant provisions of the Income Tax Act, 1961.

(xii) The Company has not entered into any scheme of arrangement which has an accounting impact on current or previous financial year.

(xiii) The Company has no borrowings from bank or financial institutions or government or government authorities or any lender on the
basis of securities of current assets during the current or previous financial year.

(xiv) The Company has complied with the number of layers prescribed under the Companies Act, 2013 read with the Companies (Restrictions
on number of layers) Rules, 2017.

42 Transactions with companies struck off:

The Company has no transactions with the companies struck off under Companies Act, 2013 or Companies Act, 1956.

As per our report of even date

For Price Waterhouse Chartered Accountants LLP For and on behalf of the Board of Directors of

Firm Registration No: 012754N/N500016 Indigo Paints Limited

CIN :L24114PN2000PLC014669

Neeraj Sharma Hemant Jalan Narayanankutty K.V.

Partner Chairman & Managing Director Director

Membership number: 108391 DIN: 00080942 DIN: 00296465

Sayalee Yengul Chetan Humane

Company Secretary & Compliance Officer Chief Financial Officer
ACS number: A37267 PAN: ABGPH4376K

Place: Pune Place: Pune

Date: May 24, 2025 Date: May 24, 2025