During the year ended March 31, 2025, the Board of Directors of the Company, at its meeting held on March 25, 2025, has approved the proposal for buy-back of fully paid up equity shares up to 37,12,871 equity shares of face value of H 5/- each of the Company for an aggregate amount not exceeding H 1,500 million, being 2.57% of the total paid up equity share capital of the Company as on March 21, 2025, at H 404 per equity share in accordance with the provisions of the Securities and Exchange Board of India (Buy-back of Securities) Regulations, 2018, as amended and the Companies Act, 2013, as amended. The Buyback is subject to the approval of the shareholders by means of a special resolution through a postal ballot.

During the year ended March 31, 2024, pursuant to the approval of the Board of Directors of the Company, at its meeting held on November 30, 2023, the Company offered 1,636,363 equity shares of face value of H 5 each for buyback to all eligible shareholders, through the tender offer process, for an aggregate amount not exceeding 900 million, equivalent to 1.12% of the total paid up equity share capital of the Company as on November 24, 2023, at H 550 per equity share, in accordance with the provisions of the Security and Exchange Board of India (Buy-back of Securities) Regulations 2018, as amended and the Companies Act, 2013, as amended. The said shares bought back through the tender offer process and were extinguished on January 05, 2024. The Company funded the buyback from its free reserves as required under the said regulations. Consequently, 1,636,363 equity shares of face value of H 5 each were extinguished by appropriating a sum of H 891.82 million from the securities premium and an amount of H 8.18 million, equivalent to the nominal value of the Equity Shares bought back through the buyback have been transferred to the capital redemption reserve account.

During the year ended March 31, 2023, pursuant to the approval of the Board of Directors of the Company, at its meeting held on June 29, 2022, and the shareholders, by way of a special resolution through postal ballot, on August 12, 2022, the Company offered 1,454,545 equity shares of face value of H 5 each for buyback for buyback to all eligible shareholders, through the tender offer process, for an aggregate amount not exceeding 800 million, equivalent 0.99% of the total paid up equity share capital of the Company as on March 31, 2022, at H 550 per equity share, in accordance with the provisions of the Security and Exchange Board of India (Buy-back of Securities) Regulations 2018, as amended and the Companies Act, 2013, as amended. The said share bought back through the tender offer process was completed on November 11, 2022. The Company funded the buyback from its free reserves as required under the said regulations. Consequently, 1,454,545 equity shares of face value of H 5 each were extinguished by appropriating a sum of H 792.73 million from the securities premium and an amount of H 7.27 million, equivalent to the nominal value of the Equity Shares bought back through the buyback have been transferred to the capital redemption reserve account.

During the year ended March 31, 2022, pursuant to the approval of the Board of Directors of the Company, at its meeting held on February 15, 2021, and the shareholders, by way of a special resolution through postal ballot, on March 20, 2021, the Company offered 1,818,181 equity shares of face value of H 5 each for buyback for buyback to all eligible shareholders, through the tender offer process, for an aggregate amount not exceeding 1,000 million, equivalent 1.24% of the total paid up equity share capital of the Company as on March 31,2020, at H 550 per equity share, in accordance with the provisions of the Security and Exchange Board of India (Buy-back of Securities) Regulations 2018, as amended and the Companies Act, 2013, as amended. The said share bought back through the tender offer process was completed on June 21, 2021. The Company funded the buyback from its free reserves as required under the said regulations. Consequently, 1,818,181 equity shares of face value of H 5 each were extinguished by appropriating a sum of H 990.91 million from the securities premium and an amount of H 9.09 million, equivalent to the nominal value of the Equity Shares bought back through the buyback have been transferred to the capital redemption reserve account.

Notes (pre share sub-division effect i.e. face value of E 10 per share):

a. 2,210,500 and 62,457,240 equity shares were allotted as fully paid Bonus Shares by capitalization of general reserve during the year ended March 31, 2006 and March 31, 2017 respectively.

b. Mr. Uday Singh was the holder of 79,000 unpaid shares in SIS International Holdings Ltd., a wholly owned subsidiary. In terms of a letter dated December 1,2009, Mr. Singh had the option to exchange these shares for shares of the Company in a manner reflecting the fair value of these shares, reduced by the amounts unpaid on them. Subsequently, in lieu of these shares and suitably adjusted for amounts unpaid thereon, Mr. Singh was allotted 40,565 Equity Shares during the year ended March 31,2017, at a ratio as determined in accordance with a valuation report prepared by a SEBI registered merchant banker.

c. During the year ended March 31,2018, the Company completed an Initial Public Offering (IPO) of its shares consisting of a fresh offer of 4,444,785 equity shares of H 10 each at a premium of H 805 per share and an offer for sale of 5,120,619 equity shares of H 10 each by the selling shareholders. The proceeds of the fresh offer component from the IPO amounted to H 3,410.47 (million) (net of issue expenses). The equity shares of the Company were listed on NSE and BSE effective August 10, 2017.

Dividends

The Company declares and pays dividends in Indian Rupees. According to the Companies Act, 2013 any dividend should be declared only out of accumulated distributable profits. A Company may, before the declaration of any dividend, transfer a percentage of its profits for that financial year, as it may consider appropriate, to the reserves.

The Board, at its meeting dated May 01, 2025, has not proposed final dividend for the year ended March 31, 2025 (March 31, 2024: H Nil per share).

Terms/rights attached to equity shares

The Company has only one class of equity shares having par value of H 5 per share. Each holder of equity shares is entitled to one vote per share and to participate in dividends in proportion to the number of and amounts paid on the shares held. The Company declares and pays dividends in Indian rupees.

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 all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Nature and purpose of Reserves Securities Premium

Security premium is used to record the premium on issue of shares or other securities such as debentures or bonds. The reserve is utilised in accordance with the Companies Act, 2013.

General Reserve

The general reserve is the result of a company's transferring a certain amount of profit from the account of retained earnings to the general reserve account. The purpose of setting up a general reserve account is to meet potential future unknown liabilities. In other words, the general reserve is a free reserve which can be utilized for any purpose after fulfilling certain conditions.

Retained earnings

Retained earnings represent the amount of accumulated earnings of the Company and re-measurement differences on defined benefit plans.

Stock Options outstanding Account

The stock options outstanding account is used to recognize the grant date fair value of options issued to employees under the company's employee stock option plans. The share-based payment reserve is used to recognise the value of equity-settled share-based payments provided to employees, including key management personnel, as part of their remuneration. Refer to note 28 for further details.

Capital redemption reserve

As per the Companies Act, 2013, Capital redemption reserve is created when a company purchases its own shares out of free reserves or securities premium. A sum equal to the nominal value of the shares so purchased is transferred to capital redemption reserve. This reserve can be utilized in accordance with the provisions of section 69 of the Companies Act, 2013. Refer note 13 for further details.

Share application money pending allotment

Share application money pending allotment represents the exercise price received from employees of the Company against stock options on which allotment is not yet made.

Long Term Borrowings - Secured:

Bonds/Debentures:

a) On March 26, 2025, the Company successfully issued 25,000 Listed, Rated, Secured, Redeemable, Non-Convertible Debentures ("NCDs") having a face value of H 1,00,000/- (Indian Rupees One Lakh only) each, aggregating to H 2,500 million, The NCDs carry interest @ 8.50% per annum, payable Quarterly. The NCDs are secured by a pledge over a portion of the Company's Shareholding in Dusters total solutions services private limited, a subsidiary of the Company. The debentures are redeemable 3 years after the date of issue. i.e. March 25, 2028.

Term loans:

From Banks:

b) Secured by way of exclusive charge on equipment/assets finance by lender to Company. The loan is repayable in 18 equal quarterly instalments commenced in the 4^th quarter of FY 2023-24 and last installment repayment is scheduled in first quarter of FY 2028-29.

c) Secured by way of exclusive charge over the Monitoring equipment/assets purchased out of the term loan proceeds. The loan is repayable in 12 equal quarterly instalments commenced from the end of the fourth quarter of FY 2021-22 and has been fully repaid during the FY 2024-25.

d) Secured by way of exclusive charge on the Monitoring equipment/assets purchased out of the term loan proceeds. The loan was repayable in 18 equal quarterly instalments commenced from the end of the 4^th quarter of FY 2023-24 and last installment repayment is scheduled in first quarter of FY 2028-29.

e) Vehicle Loan from banks are secured by hypothecation of vehicles purchased against the loan taken from that Bank. The loans have various repayment schedules and the last instalment repayment is scheduled in FY 2029-30.

The term loans mentioned above except vehicle loans, carry interest at quarterly/half-yearly/year MCLR/Repo/T-Bill plus spread ranging from upto to 186 bps (March 31, 2024: upto to 315 bps). The vehicle loans carry interest from 7.10% to 9.20% per annum.

From Other Parties:

f) Secured by way of first pari-passu charge on current and non-current assets of Dusters Total Solution Services Private Limited & Uniq Security Solutions Private Limited (subsidiaries of the Company) and pledge over portion of the Company Shareholding in Dusters Total Solutions Services Private Limited. The loan has been fully prepaid during first quarter of F.Y.2025-26.

g) Secured by way of first pari-passu charge on current and movable fixed assets of Dusters Total Solutions Services Private Limited & UNIQ Security Solutions Private Limited (subsidiaries of the Company) and pledge over portion of the Company Shareholding in Dusters Total Solutions Services Private Limited. The loan has been fully prepaid during first quarter of F.Y.2025-26.

h) Vehicle Loan from other financiers are secured by hypothecation of the respective vehicle(s) purchased against the loan taken from that financier(s). The loans carry interest from 7.50% to 9.50% per annum and have various repayment schedules and last instalment repayment is scheduled in FY 2025-2026.

Long term borrowings - Unsecured:

Bonds/debentures:

i) SIS Australia Group Pty Limited, a subsidiary, has subscribed to 750 Rupee Denominated Bonds (RDBs) of face value of H 1,000,000/- each. The RDBs will constitute direct, unconditional and unsecured obligations of the Company to repay the issue price plus interest @ 8% per annum. These RDB's shall be redeemed within 9 years (redemption due by August 2025) from the date of issue with a lock-in-period of 3 years from the date of issue and interest is payable half yearly.

Short term borrowings - Secured/Unsecured loans repayable on demand:

j) Secured by first pari-passu charges over the current assets and second pari-passu charge over movable fixed assets.

k) Secured by first pari passu charge over current assets both present and future.

l) The short-term borrowing charges are excluding assets specifically charged to term loan lenders, if any.

The loans repayable on demand mentioned above, carry interest at quarterly/half yearly/yearly MCLR/Repo rate/MIBOR/ TBILL plus spread ranging from upto 151 bps (March 31, 2024: upto 200 bps) for WCDL/Cash credit facility.

Quarterly returns or statements of current assets filed by the Company with the Banks/Financial Institutions are in agreement with the books of accounts as per the approach agreed with the lenders, as applicable.

There has been no default in the payment of interest or repayment of principal in respect of the above loans/borrowing.

Valuation methodologies:

Investment in equity / preference instruments: The Company's investments consist primarily of investment in equity / preference shares of unquoted companies. Management has considered cost to be approximating to the fair value of certain investments and valued other investments using fair valuation techniques as mentioned below.

All of the resulting fair value estimates are included in Level 3 as the fair values have been determined based on present values and discount rates used are adjusted for counter party or own credit risk.

The Company has assessed that the fair value of cash and cash equivalents, trade receivables, other financial assets, trade payables, bank overdrafts, lease liabilities and other financial liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.

The fair value of investments, loans given and fixed rate borrowings are calculated based on fixed cash flows discounted using weighted average cost of debt as on balance sheet date and accordingly classified under level 2 fair values in the fair value hierarchy due to the use of significant observable inputs.

Valuation processes

The finance department of the Company includes the team that performs the valuations of financial assets and liabilities required for financial reporting purposes, including level 3 fair values. The team reports directly to the chief financial officer (CFO). Discussions of valuation processes and results are held between the CFO and the team at least once every 3 months, in line with the Company's quarterly reporting period. External valuer's assistance is also taken for valuation purposes where required.

The main level 3 inputs used by the Company are derived and evaluated as follows:

• Discounts rates are determined using a capital asset pricing model to calculate a pre-tax rate that reflects current market assessments of the time value of money and the risk specific to the asset.

• Risk adjustments specific to the counter parties (including assumptions about credit default rates) are derived from credit risk grading determined by the Company's internal credit risk management group.

• Volatility used for option pricing model is based on historical volatility of comparable companies.

• Contingent consideration - estimated based on expected cash outflows arising from the forecasted sales and the entities; knowledge of the business and how the current economic environment is likely to impact it.

The liability for earned and sick leave is recognised and measured at the present value of the estimated future cash flows to be made in respect of non-billing employees at the reporting date. In determining the present value of the liability, attrition rates and pay increases through promotion and inflation have been taken into account.

(c) Defined contribution plans

The Company has certain defined contribution plans. Contributions are made to provident fund for employees at the rate of 12% of the salary (subject to a limit of H 15,000 salary per month) as per regulations. The contributions are made to a statutory provident fund administered by the Government. The obligation of the Company is limited to the amount contributed and it has no further contractual or constructive obligations in this regard.

Further, contributions are made in respect of Employees' State Insurance Scheme, for specified employees, at the rate of 3.25% of the gross pay as per regulations. The contributions are towards medical benefits provided by the Government to the employees. The contributions are made to employees' state insurance authorities administered by the Government. The obligation of the Company is limited to the amount contributed and it has no further contractual or constructive obligations in this regard.

Contributions to provident fund and employees' state insurance scheme are recognised as an expense as they become payable which coincides with the period during which relevant employee services are received. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in the future payments is available.

(d) Defined benefits plans

In accordance with the Payment of Gratuity Act, 1972, the Company provides for a lump sum payment to eligible employees, at retirement or termination of employment based on the last drawn salary, years of employment with the Company subject to completion of five years of service and other conditions. The gratuity plan is a partly funded plan and the Company makes contributions to a fund administered and operated by a reputed insurance company. The Company does not fully fund the liability and maintains a target level of funding to be maintained over a period of time based on estimations of expected gratuity payments.

The Company has invested the 100% plan assets in the funds managed by insurance companies.

The following tables summarises the components of net benefit expense recognised in the standalone statement of profit or loss and the funded status and amounts recognised in the standalone balance sheet for the respective plans:

The present value of defined benefit obligation relates to active employees only.

The Company has no legal obligation to settle the deficit in the funded plans with an immediate contribution or additional one-off contributions. The Company intends to continue to contribute to the defined benefit plans to achieve a target level of funding to he maintained over a period of time based on estimations of expected gratuitv payments

The above sensitivity analysis is based on a change in assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions, the same method (present value of the defined benefit obligation calculated with the projected credit unit method at the end of the reporting period) has been applied as when calculating the defined benefit liability recognised in the standalone balance sheet.

The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to the previous year. Risk Exposure

Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which are market volatility, changes in inflation, changes in interest rates, rising longevity, changing economic environment and regulatory changes.

The Company has selected a suitable insurer to manage the funds in such a manner as to ensure that the investment positions are managed with an asset-liability matching framework that has been developed to achieve investments which are in line with the obligations under the employee benefit plans. Within this framework, the asset-liability matching objective is to match assets to the obligations by investing in securities to match the benefit payments as they fall due.

The insurer, on behalf of the Company, actively monitors how the duration and the expected yield of the investments are matching the expected cash outflows arising from employee benefit obligations. The Company has not changed the processes used to manage its risks from previous periods. Investments are well diversified, such that failure of any single investment should not have a material impact on the overall level of assets.

(e) The Code on Wages, 2019 and the Code on Social Security, 2020 have been notified through Gazette of India after assent of Hon'ble President of India which govern, and are likely to impact, the contributions by the Company towards certain employee's benefits. Notification of the rules of these codes are pending. The effective date of implementation of these Codes has not yet been notified and the Company will assess the impact of these codes as and when they come into effect and will provide for the appropriate impact in its financial statements in the period in which, the Code becomes effective.

²⁸ SHARE-BASED PAYMENTS

The Company has Employee Stock Option plan namely ESOP 2016 as on March 31, 2025 and March 31, 2024.

a) During the year ended March 31, 2022, the Company issued 1,421,973 options to eligible employees which will vest over next four financial years and be eligible for exercise, subject to certain conditions, after June 1, 2025, except as approved otherwise. Out of such options:

(i) 243,741 options have been forfeited/lapsed till March 31, 2025

(ii) 275,581 options have been exercised up till March 31, 2025

(iii) 571,365 options have been vested and exercisable but not exercised / allotted as on March 31, 2025

b) During the year ended March 31, 2023, the Company issued a further 35,700 options to eligible employees which will vest over next three financial years and be eligible for exercise, subject to certain conditions, after June 1, 2025, except as approved otherwise. Out of such options:

(i) 21,800 options have been forfeited/lapsed on account of the respective employees no longer in employment till March 31, 2025.

(ii) 10,000 options have been exercised up till March 31, 2025.

(iii) 2,600 options have been vested and exercisable but not exercised as on March 31, 2025.

c) During the year ended March 31, 2024, the Company issued a further 10,000 options to eligible employees which will vest over next two financial years and be eligible for exercise, subject to certain conditions, after June 1, 2025, except as approved otherwise. Out of such options:

(i) No options have been forfeited/lapsed till March 31,2024.

(ii) 5,000 options have been vested and exercisable but not exercised as on March 31, 2025.

d) During the year ended March 31, 2025, the Company issued a further 1,000 options to eligible employees which will vest over next financial year and be eligible for exercise, subject to certain conditions, on or after October 5, 2025, except as approved otherwise. Out of such options:

(i) No options have been forfeited/lapsed till March 31,2025.

(ii) No options have been vested and not exercised/exercisable as on March 31, 2025

e) During the year ended March 31, 2025, Nomination and Remuneration Committee has approved the option of early exercise of vested option as on date.

f) There were no cancellation to the awards during the year ended March 31, 2025 and March 31, 2024 Options granted under the aforesaid plans carry no dividend or voting rights.

The Company is subject to various income tax proceedings arising from assessments for multiple assessment years. These primarily relate to disallowances of expenses including belated remittances of employees' share of Provident Fund (PF) and Employees' State Insurance (ESI) under Section 36(1)(va), disallowance u/s 14A, ESOP expenses, differences between the Return of Income and Tax Audit Report, and other disallowances under Sections 37 and 43B of the Income-tax Act, 1961. Appeals have been filed before appropriate appellate authorities including the Commissioner of Income Tax (Appeals) and Income Tax Appellate Tribunal (ITAT) as applicable. Rectification applications have also been submitted in relevant cases. The Company believes that it has a valid position in these matters and the likelihood of an outflow of resources is not considered probable at this stage. Accordingly, selected provision has been made in the financial statements, and the matters have been disclosed as contingent liabilities.

The Company is subject to various indirect proceedings under Service Tax, Finance Act, 1994 and Goods and Service Tax 2017 in various states. The litigation is due to assessments and audit conducted by GST Authorities, including the cases which have been filed under appeals at different Appellate Authorities i.e. Commissioner Appeals and CESTAT. The various issues involved are due to taxability of reimbursement of expenditure, excess claim of input credit as per authorities, pre-GST credit notes issued, GST payable on SEZ locations, GST liability due to incorrect computation of GSTR1 vs GSTR3B, GSTR3B vs GSTR9.

The Company records a liability when it is both probable that a loss has been incurred and the amount can be reasonably estimated. Significant judgment is required to determine both probability and the estimated amount. The Company reviews these provisions periodically and adjusts these provisions accordingly to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, and updated information. The Company believes that the amount or estimable range of reasonably possible loss, will not, either individually or in the aggregate, have a material adverse effect on its business, financial position, results of the Company, or cash flows with respect to loss contingencies for legal and other contingencies as at March 31, 2025.

Disputed claims against the Company, including claims raised by the tax authorities and which are pending in appeal /court and for which no reliable estimate can be made of the amount of the obligation, are not provided for in the accounts. However, the present obligation, if any, as a result of past events with a possibility of outflow of resources, when reliably estimable, is recognised in the accounts as an expense as and when such obligation crystallises.

The Company is required to disclose segment information based on the 'management approach' as defined in Ind AS 108-Operating Segments, which in how the Chief Operating Decision Maker (CODM) evaluates the Company's performance and allocates resources based on the analysis of the various performance indicators. In the case of the Company, the CODM reviews the results of the Company as a whole as the Company is primarily engaged in the business of rendering security services in India. Accordingly, the Company is a single CGU, hence single segment Company. The information as required under Ind AS 108 is available directly from the financial statements, hence no separate disclosures have been made.

Terms and conditions of transactions with related parties

Transactions relating to dividends paid, subscription for new equity shares were on the same terms and conditions that applied to other shareholders.

The sales to, and purchases from, related parties are made on normal commercial terms and conditions and at market rates. Outstanding balances at the year-end are unsecured and carry interest equivalent to the market rate, where specified, in terms of the transactions, and settlement occurs in cash. For the year ended March 31, 2025, the Company has not recorded any impairment of receivables relating to amounts owed by related parties (March 31, 2024: Nil). This assessment

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 mainly comprises currency risk and interest rate risk. Financial instruments affected by market risk include loans and borrowings, loans and deposits given, FVTOCI investments and derivative financial instruments.

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 which arises from assets and liabilities denominated in currencies other than the functional currency of the respective entities and foreign currency revenue and cash flows. The Company's exposure to the risk of changes in foreign currency exchange rates relates primarily to the Company's operating activities (when revenue or expense is denominated in a foreign currency) and the Company's net investments in foreign subsidiaries. The Company has limited foreign currency transactions and has limited exposure to foreign currency assets and liabilities resulting in the foreign currency risk being low.

The exchange rate between the Indian Rupee and foreign currencies has fluctuated in recent years and may continue to do so in the future. Consequently, the results of the Company's operations may be affected as the Indian Rupee appreciates/ depreciates against these currencies.

⁴⁰ FINANCIAL RISK MANAGEMENT

The Company's principal financial liabilities, comprise loans and borrowings, trade and other payables, and financial guarantee contracts. The main purpose of these financial liabilities is to finance the Company's operations and to provide guarantees to support the financing of the operations of its subsidiaries, joint ventures and associates. The Company's principal financial assets include trade and other receivables, cash and cash equivalents that derive directly from its operations, loans, security and other deposits.

The Company's operations expose it to market risk, credit risk and liquidity risk. The Company's focus is to reduce volatility in financial statements while maintaining balance between providing predictability in the Company's business plan along with reasonable participation in market movement. It is the Company's policy that no trading in derivatives for speculative purposes may be undertaken.

Credit risk

Credit risk arises from the possibility that counterparties may not be able to settle their obligations as agreed resulting in a financial loss. The primary exposure to credit risk arises from Trade receivables and Unbilled revenue (refer note 11 & 7 respectively). These are unsecured and are managed by the Company through a system of periodically assessing the financial reliability of customers, taking into account the financial condition, current economic trends, and analysis of historical bad debts and ageing of accounts receivables. There is no customer accounted for more than 10% of the accounts receivable as of March 31, 2025 (March 31, 2024: single customer). There is no significant concentration of credit risk. The Company uses the expected credit loss ('ECL') method to assess the loss allowance for Trade receivables and Unbilled revenue taking into account primarily the historical trends and analysis of bad debts. The Company does not expect any credit risk or impairment in respect of amounts lent to its subsidiaries, associates and joint ventures, if any.

The credit risk for financial assets other than bank balances and trade receivables are considered low.

Significant estimates and judgements Impairment of financial assets

The impairment provision for financial assets disclosed above 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 the Company's past history and existing market conditions. The Company estimates loss arising on trade receivables as a percentage of sales based on past trends and such loss is directly debited to revenue instead of creating a provision for impairment of receivables.

Financial instruments and cash deposits

Credit risk from balances with banks and financial institutions is managed by the Company's treasury department in accordance with the Company's policy. Surplus funds are invested in bank fixed deposits or used to temporarily reduce the balance of cash credit accounts to optimize interest costs.

Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting its obligations associated with financial liabilities. The Company consistently generates sufficient cash flows from operations and has access to multiple sources of funding to meet its financial obligations and maintain adequate liquidity for use.

⁴⁰ FINANCIAL RISK MANAGEMENT (CONTD.)

The Company's objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts, bank loans, debentures, shareholder equity, and finance leases.

The Company has assessed the concentration of risk with respect to refinancing its debt and concluded it to be low. The Company has access to a sufficient variety of sources of funding and significant portion of short-term debt maturing within 12 months can be rolled over with existing lenders. The Company believes that it has sufficient working capital and cash accruals to meet its business requirements and other obligations.

The table below summarises the maturity profile of the Company's financial liabilities based on contractual undiscounted payments.

4l| ADDITIONAL CAPITAL DISCLOSURES

For the purpose of the Company's capital management, capital includes issued equity capital, share premium, all other equity reserves attributable to the equity holders of the Company. The primary objective of the Company's capital management is to maximise shareholder value and support its strategies and operating requirements. The key objective of the Company's capital management is to ensure that it maintains a stable capital structure with a focus on total equity to uphold investor, creditor, and customer confidence and to ensure future development of its business. The Company determines the capital requirement based on annual operating plans and long-term and other strategic investment plans. The funding requirements for the Company's operations are generally met through operating cash flows generated and supplemented by long-term and working capital borrowings from banks.

The Company's objectives when managing capital are to:

a) safeguard its ability to continue as a going concern, so that it can continue to provide returns for shareholders and benefits for other stakeholders, and

b) Maintain an optimal capital structure to optimise the cost of capital.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants to which it is subject. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Company monitors capital using a ratio, which is Net Debt divided by EBITDA. The Company defines Net Debt as borrowings and lease liabilities less cash and cash equivalents including bank balances and deposits irrespective of their duration / maturity.