SKF India (Industrial) Ltd. ಖಾತೆಯ ಉಪಯುಕ್ತ ಮಾಹಿತಿ

Mar 31, 2026

1.14 Provisions

Provisions for legal claims, service warranties,
volume discounts and returns are recognised when
the Company has a present legal or constructive
obligation as a result of past events, it is probable that
an outflow of resources will be required to settle the
obligation and the amount can be reliably estimated.
Provisions are not recognised for future operating
losses.

Provisions are measured at the present value of
management''s best estimate of the expenditure
required to settle the present obligation at the end
of the reporting period. The discount rate used to
determine the present value is a pre-tax rate that
reflects current market assessments of the time value
of money and the risks specific to the liability. The
increase in the provision due to the passage of time is
recognised as interest expense.

1.15 Post employment benefitsEmployee benefits

i) Short-term obligations

Liabilities for wages and salaries, including non¬
monetary benefits that are expected to be settled
wholly within 12 months after the end of the
period in which the employees render the related
service are recognised in respect of employees''
services up to the end of the reporting period
and are measured at the amounts expected
to be paid when the liabilities are settled. The
liabilities are presented as current employee
benefit obligations in the balance sheet.

ii) Other long-term employee benefit obligations
The liabilities for earned leave are not expected
to be settled wholly within 12 months after the
end of the period in which the employees render
the related service. They are therefore measured
as the present value of expected future
payments to be made in respect of services
provided by employees up to the end of the

reporting period using the projected unit credit
method. The benefits are discounted using the
market yields at the end of the reporting period
that have terms approximating to the terms of
the related obligation. Remeasurements as a
result of experience adjustments and changes in
actuarial assumptions are recognised in profit or
loss.

The obligations are presented as current liabilities
in the balance sheet if the entity does not have
an unconditional right to defer settlement for at
least twelve months after the reporting period,
regardless of when the actual settlement is
expected to occur.

iii) Post-employment obligations

The Company operates the following post¬
employment schemes:

a) defined benefit plans such as gratuity

b) defined contribution plans such as
superannuation and provident fund.

Defined Benefit Plans

The liability or asset recognised in the balance
sheet in respect of gratuity is the present value
of the defined benefit obligation at the end of the
reporting period less the fair value of plan assets.
The defined benefit obligation is calculated
annually by actuaries using the projected unit
credit method.

The present value of the defined benefit obligation
is determined by discounting the estimated
future cash outflows by reference to market yields
at the end of the reporting period on government
bonds that have terms approximating to the
terms of the related obligation.

The net interest cost is calculated by applying
the discount rate to the net balance of the
defined benefit obligation and the fair value of
plan assets. This cost is included in employee
benefit expense in the statement of profit and
loss.

Remeasurement gains and losses arising
from experience adjustments and changes in
actuarial assumptions are recognised in the
period in which they occur, directly in other
comprehensive income. They are included in
retained earnings in the statement of changes in
equity and in the balance sheet.

Changes in the present value of the defined benefit
obligation resulting from plan amendments or

curtailments are recognised immediately in profit
or loss as past service cost.

Defined contribution plans

Contributions to the Provident Fund and
Superannuation Fund which are defined
contribution schemes, are recognised as an
expense in the Statement of Profit and Loss in
the period in which the contribution is due. The
Company has no further payment obligations
once the contributions have been paid.

iv) Bonus Plans

The Company recognises a liability and an
expense for bonuses. The Company recognises
a provision where contractually obliged or where
there is a past practice that has created a
constructive obligation.

v) Employee Stock Awards:

Certain employees of the Company receive
remuneration in the form of equity settled
instruments given by the ultimate holding
company (AB SKF), for rendering services over
a defined vesting period. Equity instruments
granted are measured by reference to the fair
value of the instrument at the date of grant. The
expense is recognized in the statement of profit
and loss with a corresponding increase to the
share based payment reserve, as a component
of equity. The fair value determined at the grant
date is expensed over the vesting period of the
respective tranches of such grants. The stock
compensation expense is determined based on
the Company''s estimate of equity instruments
that will eventually vest.

vi) Termination benefits

Voluntary Retirement Scheme costs are charged
off to the Statement of Profit and Loss in the year
in which they are incurred.

1.16 Contributed Equity

Equity shares are classified as equity
Incremental costs directly attributable to the issue
of new shares or options are shown in equity as a
deduction, net of tax, from the proceeds.

1.17 Earnings per share

The basic earnings per share is computed by dividing
the net profit attributable to the equity shareholders
for the period by the weighted average number of

equity shares outstanding during the reporting period.
Diluted EPS is computed by dividing the net profit
attributable to the equity shareholders for the year by
the weighted average number of equity and equivalent
diluted equity shares outstanding during the year,
except where the result would be anti dilutive.

1.18 Contingent liabilities

A contingent liability is disclosed in respect of a
possible obligation that arise from past events whose
existence will be confirmed only on the occurrence or
non-occurrence of one or more uncertain future events
not wholly within the control of the Company or from a
present obligation that arises from past events which
are not recognised because:

a) i t is not probable that an outflow of resources
embodying economic benefits will be required to
settle the obligation; or

b) the amount of the obligation cannot be measured
with sufficient reliability

1.19 Business Combinations (common control business
combinations)

Business combination involving entities that are
controlled by the company are accounted for using
the pooling of interest method as follows:

a) The assets and liabilities of the combining
entities are reflected at their carrying amounts.

b) No adjustments are made to reflect fair values,
or recognise any new assets or liabilities.
Adjustments are only made to harmonise
accounting policies.

c) The financial information in the financial
statements in respect of prior periods is restated
as if the business combination had occurred
from the beginning of the preceding period in the
financial statements, irrespective of the actual
date of the combination. However, where the
business combination had occurred after that
date, the prior period information is restated only
from that date.

d) The balance of retained earnings appearing
in the financial statements of the transferor is
aggregated with the corresponding balance
appearing in the financial statements.

e) The identity of the reserve are preserved and the
reserves of the transferor becomes the reserves
of the transferee.

1.20 Exceptional items

When items of income and expense within profit or
loss from ordinary activities are of such size, nature or
incidence that their disclosure is relevant to explain
the performance of the Company for the period,
the nature and amount of such items is disclosed
separately as Exceptional Items.

1.21 Dividend

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

1.22 Rounding of amounts

All amounts disclosed in the financial statements and
notes have been rounded off to the nearest Million as
per the requirement of Schedule III, unless otherwise
stated.

2 Significant accounting judgements, estimates and
assumptions

The preparation of the Company''s financial statements
requires management to make judgements, estimates
and assumptions that affect the reported amounts
of revenues, expenses, assets and liabilities, and
the accompanying disclosures, and the disclosure of
contingent liabilities. This note provide an overview of
the areas that involve a higher degree of judgement or
complexity and of items which are more likely to be
materially adjusted due to estimates and assumptions
turning out to be different than those originally
assessed. Detailed information about each of these
estimates and judgements is mentioned below.
Estimates and judgements are continually evaluated.
They are based on historical experience and other
factors, including expectations of future events
that may have a financial impact on the Company
and that are believed to be reasonable under the
circumstances.

Estimates and judgements are continually evaluated.
They are based on historical experience and other
factors, including expectations of future events
that may have a financial impact on the Company
and that are believed to be reasonable under the
circumstances.

2(A) Significant Judgement

a) Tax Contingencies

Pursuant to the Scheme of Arrangement, advance
tax payments, prepayments, tax balances with
statutory authorities, matters under litigation,
and related tax provisions/liabilities continue
to be administered in the name of SKF India
Limited (“Demerged Company") as part of an
ongoing process. Although these amounts relate
to periods prior to the demerger, the ultimate
financial impact whether in the form of refunds
or additional tax liabilities will be recognized
between Company and SKF India Limited
(“Demerged Company") upon the conclusion of
the relevant assessment proceedings.

The outcome of these matters may have a
material effect on the financial position, results of
operations or cash flows. Management regularly
analyzes current information about these
matters and provides provisions for probable
contingent losses including the estimate of legal
expense to resolve the matters. In making the
decision regarding the need for loss provisions,
management considers the degree of probability
of an unfavourable outcome and the ability
to make a sufficiently reliable estimate of the
amount of loss. The filing of a suit or formal
assertion of a claim against the Company or the
disclosure of any such suit or assertions, does
not automatically indicate that a provision for a
loss may be appropriate.

2(B) Significant estimate

a) Impairment of financial assets

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

b) Fair valuation of financial instruments

When the fair values of financial assets and
financial 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 model. The inputs to these models are
taken from observable markets where possible,
but where this is not feasible, 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 financial
instruments. See Note 38 for further disclosures.

c) Defined benefit plan

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

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

The mortality rate is based on Indian Assured
Lives Mortality (2012-14) Ultimate. Those
mortality tables tend to change only at interval in
response to demographic changes. Future salary
increases and gratuity increases are based on
expected future inflation rates. Further details
about gratuity obligations are given in Note 36(N).

d) Fair Valuation of Investment Property

The Company obtains independent valuations
for its investment properties at least annually.
The Valuation is performed using Income
approach-Rent capiltalisation method as per Ind
AS 113- Fair value measurement.

PREMISES GIVEN ON OPERATING LEASE:

The Company has given investment properties on lease. These arrangements are classified as operating leases from a lessor
perspective because all the risks and rewards incidental to the ownership of the assets are not transferred substantially
to the lessee. These lease arrangements range for a period between 2 and 5 years and include both cancellable and
non-cancellable leases. Most of the leases are renewable for further period on mutually agreeable terms. The Company has
not retained any right in underlying asset.

The said loan together with interest is secured by first charge by way of hypothecation on all the fixed assets of the
borrower and corporate guarantee given by AB SKF (Ultimate Parent Company). Loan is considered to be recoverable
considering favourable loan to security ratio, no defaults in repayment in the past, improved operational performance of
the borrower, support by the borrower''s holding company in the past and supported by reasonable assumption used for
future cash flow. The rate of interest on the loan is the average deposit and lending rate (higher of the two) for the period
of the loan and prevailing yield for the government securities closest to the tenure of the loan, whichever is higher.

ii) There is no loss allowance for receivables in relation to any outstanding balances, and no loss allowance has been
recognised during the year in respect of receivables due from related parties.

Deferred tax assets and deferred tax liabilities have been offset wherever the Company has a legally enforceable right to set-off current tax
assets against current tax liabilities and where the deferred tax assets and deferred tax liabilities relates to income tax levied by the same
taxation authorities.

The Company has done a detailed analysis of future recoverability of the Deferred Tax assets based on the internal and external information
and expects, the recoverability of the Deferred Tax asset is not impacted.

*Other timing differences includes a stamp duty provision of INR 1,139 Million against which deferred tax asset of INR 286.4 Million has
been recognized, and demerger expenses that are allowable over five years with a balance of INR 480.9 Million remaining to be allowed, for
which deferred tax of INR 121.1 Million has been recognized.

Pursuant to the approval of the Scheme of Arrangement by the NCLT, the Company increased its authorized share
capital from INR 1.5 million to INR 500 million (Refer note 35).

*The record date for determining the eligibility of the shareholders of SKF India Limited for the allotment of equity shares of SKF India
(Industrial) Limited, in the ratio of one fully paid-up new equity share of INR 10 each of the Company for every one equity share of INR
10 each held in SKF India Limited (pursuant to the Scheme of Arrangement), was fixed on 15^th October, 2025. The Company recorded
INR 494.4 Million (49,437,963 equity shares of par value INR 10 each) as “Issued and Subscribed Share Capital” and disclosed it under
Equity Share Capital. The allotment of the aforesaid equity shares by the Board of Directors of the Company was on 15^th October, 2025.
The existing equity shares of INR 1,00,000 (10,000 equity shares of INR 10 each) was cancelled on 1^st October, 2025 (Refer note 35).

B. Rights, preferences and restrictions attached to equity shares

The Company has only one class of equity shares having a par value of INR 10 per share. Each shareholder is entitled to
one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders
in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation of the Company,
the equity shareholders are eligible to receive remaining assets of the Company, after distribution of all preferential
amounts, in the proportion to their shareholding.

(i) Provision for disputed statutory and other matters: This represents provisions made for probable liabilities/
claims arising out of pending disputes/litigations with various regulatory authorities and those arising out of
commercial transactions with vendors/employees/others. Above provisions are affected by numerous uncertainties
and management has taken all efforts to make a best estimate. Timing of outflow of resources will depend upon
timing of decision of cases.

The Company has reviewed the various liabilities/claims relating to tax and legal matters and estimated the
provision for contingencies based on assessment of its probability of outflows. These provisions have not been
discounted as it is not practicable for the Company to estimate the timing of the provision utilisation and cash
outflows, if any, pending resolution.

(ii) Industrial Market (IM) Incentives: The provision for other obligations is on account of coupons given on products
sold by the Company and other retailers and distributors incentive schemes. The provision for coupons is based
on the historical data/estimated figures. The timing and amount of the cash flows that will arise will be determined
at the time of receipt of claims from customers, which is generally up to 18 months.

(iii) Special Price Request: The Company operates a Sales Promotion Reward (SPR) Scheme for authorized distributors,
offering rebates and incentives linked to sales performance. Expenses under the scheme are recognized in the
Statement of Profit and Loss as selling and distribution costs, with provisions created where obligations are
reliably estimable.

C Performance obligations and remaining performance obligations

The remaining performance obligation disclosure provides the aggregate amount of the transaction price yet to be
recognised as at the end of the reporting period and an explanation as to when the Company expects to recognise
these amounts in revenue. Applying the practical expedient as given in Ind AS 115, the Company has not disclosed the
remaining performance obligation related disclosures for contracts that have original expected duration of one year or
less.

29.2 Details of Corporate Social Responsibility Expenditure

The Company was incorporated on 17^th December, 2024 and has incurred a loss of INR 0.7 Million during the period.
The Company did not meet the threshold criteria prescribed under Section 135 of the Companies Act, 2013 with respect
to net worth of INR 500 Crores or turnover of INR 1,000 Crores during the immediately preceding financial year (without
restatement). Accordingly, the provisions of Section 135 of the Companies Act, 2013 read with the relevant rules relating to
Corporate Social Responsibility (CSR) are not applicable to the Company for the current financial year, as it does not meet
the prescribed threshold limits. Consequently, no CSR expenditure has been incurred during the year.

Note: SKF India Limited (‘the Demerged Company'') has entered into a Bilateral Advance Pricing Agreement
(BAPA) with the Central Board of Direct Taxes (‘CBDT'') in respect of financial years from FY 2012-13 to
FY 2020-21, relating to certain transactions with its Ultimate Parent Company. As the financial years covered
under the BAPA precede the effective date of the Demerger (01^st October, 2025), and in accordance with
the approved Scheme of Demerger, the Company is liable for its share of the tax payable and/or entitled to
the refund receivable arising therefrom. Consequent to above, the Company has recognised an amount of
INR 49.9 Million towards its share of the secondary adjustments, which has been accounted during the year ended
31^st March, 2026.

(i) Pursuant to the Scheme of Arrangement, SKF India (Industrial) Limited (Resulting Company) has acquired certain
parcels of land and buildings from SKF India Limited (Demerged Company). The Company is currently in the process
of effecting the change in ownership name on the title deeds. The estimated premium payable towards stamp duty for
such transfer is INR 1,639.2 Million.

(ii) During the year ended March 2026, the Company has Incurred certain demerger expense for IT cost and professional
services aggregating to INR 286.9 Million towards Scheme of Arrangement as explained In note 35. These restructuring
costs are non-recurring in nature and do not reflect the Company''s normal operating performance.

(iii) On 21^st November, 2025, the Government of India notified the four Labour Codes - the Code on Wages, 2019, the
Industrial Relations Code, 2020, the Code on Social Security, 2020, and the Occupational Safety, Health and Working
Conditions Code, 2020 - consolidating 29 existing labour laws into a unified framework governing employee benefits
during employment and post-employment. The Ministry of Labour & Employment published draft Central Rules and
FAQs to enable assessment of the financial impact due to changes in regulations. The Company has assessed and
disclosed the incremental financial impact of these changes on the basis of legal advise obtained and the best
information currently available, consistent with the guidance provided by the Institute of Chartered Accountants
of India. Considering the materiality and regulatory-driven, non-recurring nature of this impact, the Company has
presented this incremental financial impact as “Statutory impact of new Labour Codes" under “Exceptional item" in the
standalone financial statement for the year ended March 31, 2026. The incremental impact consisting of gratuity of
INR 34.9 Million primarily arises due to change in wage definition.

The Company continues to monitor the finalisation of Central/State Rules and clarifications from the Government on other
aspects of the Labour Code and would provide appropriate accounting effect on the basis of such developments as needed,
if any on the measurement of liability pertaining to employee benefits.

32. Earnings per share
Basic and diluted earnings per share

The earnings per share (basic & diluted), computed as per the requirement under Indian Accounting Standard (IND AS 33)
on ‘Earnings per Share'' is as under:

33. Segment Reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the Chief operating decision
maker. The Board of Directors has been identified as the Chief operating decision maker (CODM). The Company operates in
only one business segment viz. ‘Bearings''. This is the principal activity for the Company. The segment revenue is measured
in the same way in Statement of Profit and Loss.

(i) Others

The Company has disclosed other claims relating to civil cases considering similar industry practices.

The Company has reviewed the various liabilities/claims relating to tax and legal matters and estimated the
provision for contingencies based on assessment of its probability of outflows. These provisions have not been
discounted as it is not practicable for the Company to estimate the timing of the provision utilisation and cash
outflows, if any, pending resolution.

Pursuant to the Scheme of Arrangement (Demerger) between SKF India Limited (Demerged Company) and SKF
Industrial Limited (Resulting Company), approved by the Hon''ble National Company Law Tribunal (NCLT) with
an appointed date of 1^st October, 2025, the tax-related assets and liabilities up to 1^st October, 2025 have been
allocated in accordance with the terms of the Scheme.

As per the provisions of the Scheme and related agreements:

All disputed tax liabilities, assets, and contingent liabilities pertaining to the period up to the appointed date
continue to be retained and shall be settled in the books of SKF India Limited (Demerged Company);

Accordingly, the Company does not carry any contingent liability or disputed tax liability in respect of such matters
as at the reporting date;

Upon completion of the respective assessment proceedings and final determination of tax liabilities, tax refunds,
any settlement, including payment of tax, interest, or penalties, shall be undertaken between SKF India Limited
and the Company into the agreed contingent liability proportion.

35. Scheme of Arrangement between SKF India Limited (“Demerged Company”), SKF India (Industrial) Limited
(“Resulting Company”), and their respective shareholders and creditors (referred as the “Scheme”)

The Board of Directors of the Company at its meeting held on 26^th December, 2024, has approved the Scheme of Arrangement
among SKF India Limited (“Demerged Company"), SKF India (Industrial) Limited (“Resulting Company"), and their respective
shareholders and creditors under section 230-232 and other applicable provisions of the Companies Act, 2013 and ruled
framed thereunder (the “Scheme"). The Scheme has an appointed and effective date of 01^st October, 2025. The certified
copy of the NCLT Order was filed with the Registrar of Companies on 01^st October, 2025 (“Effective Date").

During the year, the Company has received requisite approval from NCLT, Mumbai Bench, vide its order dated
26^th September, 2025. Respective companies have subsequently filed the certified true copy of NCLT order along with the
sanctioned scheme with the Registrar of Companies on 30^th September, 2025 (closing hours). Accordingly, the Scheme is
effective w.e.f. 01^st October, 2025.

With effect from the Appointed and Effective Date, the Industrial Business of SKF India Limited (along with all assets,
liabilities and retained earnings thereof at their respective carrying value as appearing in the books of the Demerger
Company) was transferred to the Resulting Company on a going concern basis. As consideration, the Resulting Company,
pursuant to the Scheme, allotted 43,437,963 Equity Shares of face and paid-up value of INR 10 each to the shareholders of
the Demerged Company (as on the Record Date i.e., 15^th October, 2025) in the ratio of 1:1 (one Equity Share of INR 10 each
issued by the Resulting Company for every one Equity Share of INR 10 each held in the Demerged Company). Consequently,
the Resulting Company ceased to be a subsidiary of SKF India Limited with effect from 01^st October, 2025. The equity
shares of the Company are listed on BSE Limited (BSE) and the National Stock Exchange of India Limited (NSE) in India on|
05^th December, 2025.

The Resulting Company has given effect to the Scheme in accordance with the accounting treatment specified therein and
as per applicable accounting standards (Ind AS) as under:

- Recorded the assets, liabilities and retained earning at their respective carrying values as appearing in the books of the
Demerged Company [refer details in (a) below].

- I ssued 43,437,963 Equity Shares of face and paid-up value of INR 10 each to the shareholders of the Demerged
Company.

The figures for the comparative period ending 31^st March, 2025, have been restated as if the arrangement had
occurred from the date of incorporation of the Company i.e., 17^th December, 2024. Accordingly, the figures for
the period ended 31^st March, 2025 and year ended 31^st March, 2026 include the results of the Company and
the Demerged Undertaking transferred under the Scheme. Figures for period from 17^th December, 2024 to
31^st March, 2025 are not audited. Further, as a result of scheme became effective, the assets, liabilities and
retained earnings as presented as at 31^st March, 2026 reflect the impact of the scheme and are accordingly not
comparable with those as at 31^st March, 2025.

36. Employee benefits
A Post employment benefit plans
Compensated absences

The Compensated absences cover the Company''s liability for privilege leave and sick leave. The entire amount of
the provision of INR 169.2 Million is presented as current, since the Company does not have an unconditional right
to defer settlement for these obligations. Expected amount towards settlement of Leave for the next 12 months are
INR 33.0 Million.

Defined contribution plans

The Company makes contributions, determined as a specified percentage of employee salaries, in respect of qualifying
employees towards Provident Fund, which is a defined contribution plan. The contributions are charged to the profit and
loss as they accrue. The amount recognised as an expense towards contribution to Provident Fund and Superannuation
fund is as follows:

II Defined Benefit plans
i) Gratuity

The Company operates a post-employment defined benefit plan that provides gratuity. The gratuity plan entitles
an employee, who has rendered at least five years of continuous service, to receive between 15 days to one
month''s salary for each year of completed service at the time of retirement/exit.

The following table summarises the position of assets and obligation.

The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority,
promotion and other relevant factors, such as supply and demand in the employment market.

Assumptions regarding future mortality are set based on actuarial advice in accordance with published statistics
and experience in each territory. These assumptions translate into an average life expectancy in years for a
pensioner.

Expected contribution to post employment benefit plans for the FY 2026-27 is INR 30.0 Million (FY 2025-26
INR 30.0 Million)

ii) Provident Fund

Pursuant to the demerger of SKF India Limited, effective 1^st October, 2025, the Company has aligned its employee
benefit obligations with applicable statutory provisions. In this regard, the Company has submitted an application
to the Employee Provident Fund Organization (“EPFO”) to surrender its share from the combined pension fund of
SKF India Limited towards past obligations to EPFO. The application is currently under review by the EPFO, which
is pending as at 31^st March, 2026.

However, w.e.f. 1^st October, 2025 the Company is remitting the provident fund contribution to EPFO.

The Company has certain defined contribution plans. Contributions are made to provident fund in India for
employees at the rate of 12% of basic salary as per regulations. The contributions are made to registered provident
fund administered by the government. The obligation of the Company is limited to the amount contributed and
it has no further contractual and any constructive obligation. The expense recognised during the year towards
defined contribution plan is INR 122.0 Million (31 March 2025 - INR 25.2 Million).

B. Terms and conditions of transactions with related parties:

(i) The sales to and purchase from related parties are made on terms equivalent to those that prevail in arm''s length
transaction. Outstanding balances at the year end are unsecured and settlement occurs in cash. There have been
no guarantees provided or received for any related party receivables or payables except for the loan given. For the
year ended 31^st March, 2026, the Company has not recorded any impairment of receivables relating to amounts
owed by related parties (31^st March, 2025: Nil).

(ii) Services rendered include renting services, technical, other services, etc.

(iii) Services received include administrative, IT services, royalty, trade-mark, other services etc.

(iv) Includes recoveries on account of employee cost, travel costs, training, IT services, etc.

Notes:

1. The loans has been given to fellow subsidiary and the rate of interest on the said loan availed shall be equivalent
to seven-year govt security, which is currently 7.5% or fixed deposit/term deposits rate, whichever is higher plus
150 bps. The rate of interest shall be reviewed every 6 months. The interest shall be payable at quarterly rest on
31^st March, 30^th June, September 30 and 31^st,December every year on the outstanding loan amount. Term loan is
valid till December 31, 2029.

2. The related party transactions for the period from 17^th December, 2024 to 31^st March, 2025 and April 01, 2025 to
30^th September 2025 has been disclosed on the basis of transactions entered into by the Company and do not
include transactions of the demerged undertaking till the effective and appointed date under the scheme, as these
transactions occurred within the same legal entity. (Refer Note 35).

3. Managerial remuneration does not include cost of employee benefits such as gratuity and compensated absences
since, provision for these are based on valuation carried out for the Company as a whole.

4. Pursuant to the Scheme of Arrangement, SKF India Limited (“Demerged Company") and Company entered into
Interim Transition Service Arrangements (“ISA") for the sharing of common facilities and functions. Under these
arrangements, the costs attributable to such shared facilities and functions are cross charged with mark up on a
proportionate basis, in the ratio mutually agreed upon by both entities, with effect from the appointed date of 1^st
October, 2025. The costs so cross charged are recognised in the books of account of the both entities under the
respective income and expense heads.

Notes:

(i) The fair values of all financial instruments carried at amortised cost are not materially different from their carrying
amounts since they are either short-term in nature or the interest rate applicable are equal to the current market rate of
interest.

Fair value hierarchy

This section explains the judgements and estimates made in determining the fair values of the financial instruments that
are measured at amortised cost and for which fair values are disclosed in the financial statements. 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 are as follows:

Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.

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.
Accounting classification and fair value

The following table shows the carrying amount and fair value of financial assets and financial liabilities:

Fair valuation method

The Company performs the valuations of financial assets and liabilities required for financial reporting purposes, including
level 3 fair values.

39. Financial Risk Management
Risk management framework

In the course of its business, the Company is exposed primarily to market risk, liquidity risk and credit risk, which may
impact the fair value of its financial instruments. The Company has a risk management policy which not only covers the
foreign exchange risks but also other risks associated with the financial assets and liabilities such as credit risks. The risk
management policy is approved by the board of directors.

The Risk Management framework aims to create a stable business planning environment by reducing the impact of market
related risks, credit risks & currency fluctuations on the Company''s earnings.

The Company has exposure to the following risks arising from financial instruments:

• Credit risk;

• Liquidity risk; and

• Market risk pending

Market risk is the risk of any loss in future earnings, in realizable fair values or in future cash flows that may result from a
change in the price of a financial instrument. The value of a financial instrument may change as a result of changes in the,
foreign currency exchange rates, liquidity and other market changes. Future specific market movements cannot be normally
predicted with reasonable accuracy.

i) Foreign Currency risk

The Company transacts internationally and is exposed to foreign exchange risk arising from foreign currency
transactions, primarily with respect to the USD, EUR and SEK. Foreign exchange risk arises from future commercial
transactions and recognised assets and liabilities denominated in a currency that is not the company''s functional
currency (INR).

The Company has both Import and Export transactions in Foreign currency. The Imports are higher than the exports
and hence the Company has foreign currency exposure to the extent of purchases being higher than exports, but any
material variation in currency is recovered from the customers, through on going negotiation process. Thus the risk for
currency fluctuation is mitigated.

The Company''s exposure to foreign currency risk at the end of the reporting period are as under:

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''s borrowing comprises of working capital loan which carries fixed rate
of interest and which do not expose it to interest rate risk. The borrowings also includes cash credit facilities which
carries variable rate of interest.

The Company''s has no exposure to borrowings.

The loan to related party is carried at amortised cost. The Company recovers interest as per the terms of the agreement.
The interest rate approximates the market rate of interest and hence the interest risk for loan given to related party is
not considered to be substantial.

39 (B) Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability
of funding through an adequate amount of committed credit facilities to meet obligations when due and to pay out
obligations. Due to the dynamic nature of the underlying businesses, Company ensures availability of funds by managing
the investments.

Management monitors rolling forecasts of the Company''s liquidity position and cash and cash equivalents on the basis
of expected cash flows. The Company''s liquidity management policy involves projecting cash flows and considering the
level of liquid assets necessary to meet this. The Company invests its surplus funds in bank fixed deposit and in quoted
government debt securities.

39 (C) Credit risk

Credit risk is the risk of financial loss arising from counterparty failure to repay or service debt according to the contractual
terms or obligations. Credit risk encompasses both the direct risk of default and the risk of deterioration of creditworthiness.

Credit risk management

For banks and financial institutions, only high rated banks/institutions are accepted.

The Company considers the probability of default upon initial recognition of asset and whether there has been a significant
increase in credit risk on an ongoing basis throughout each reporting period. To assess whether there is a significant increase
in credit risk the Company compares the risk of a default occurring on the asset as at the reporting date with the risk of
default as at the date of initial recognition. It considers available reasonable and supportive forwarding-looking information.
Especially the following indicators are incorporated:

- actual or expected significant adverse changes in business, financial or economic conditions that are expected to
cause a significant change to the counterparty ability to meet its obligations

- actual or expected significant changes in the operating results of the counterparty

- significant increase in credit risk on other financial instruments of the same counterparty

- significant changes in the value of the collateral supporting the obligation or in the quality of third-party guarantees or
credit enhancements

The definition of default is determined by considering the business environment in which entity operates and other macro¬
economic factors. All receivables past due are analysed and based on scrutiny provisions for Bad Debts are made on
specific identification basis.

Exposure to credit risk

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk,
being the total of the carrying amount of balances with bank, short term deposits with banks, trade receivables and other
financial assets is disclosed at the end of the each reporting period. Refer relevant notes for details.

Financial assets that are neither past due nor impaired

None of the Company''s cash equivalents, including time deposits with banks, are past due or impaired. Regarding trade
receivables and other receivables, and other financial assets that are neither impaired nor past due, there were no indications
at the end of each reporting period, that defaults in payment obligations will occur.

The Company follows 12 months expected credit losses (expected credit losses that result from those default events on the
financial instrument that are possible within 12 months after the reporting date) model for recognition of impairment loss
on financial assets measured at amortised cost other than trade receivables. The Company follows lifetime expected credit
loss model (simplified approach) for recognition of impairment loss on trade receivables.

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.

40 Capital Management
(a) Risk management

The Company''s objectives when managing capital are to

• Safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and
benefits for other stakeholders, and

• Maintain an optimal capital structure to reduce the cost of capital.

I n order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders,
return capital to shareholders, issue new shares or sell assets to reduce debt.

The Company determines the amount of capital required on the basis of annual operating plans and long-term product and other
strategic investment plans. The funding requirements are met through equity.

41. Share based payments
SKF’s Performance Share Programme

Aktiebolaget SKF (AB SKF), Sweden the ultimate holding company, as part of its Performance Share Program (PSP) offers
stock awards to selected employees of its subsidiaries.

The shares of AB SKF, Sweden are listed with Nasdaq Stockholm Stock Exchange, Sweden. The awards issued are vested for
a period of 3 years from the date of grant depending on the performance conditions. The terms and other conditions applicable
to each award granted under the PSP are generally determined by the Group Management of AB SKF. The programme covers
senior managers and key employees in the SKF Group, including Group Management, with the opportunity of being allotted,
free of charge, SKF shares of series B. Under the programme, no more than 1,000,000 SKF shares of series B, may be
allotted. Fulfilment% is decided by the Group Management based on the performance conditions met. The number of shares
definitively vested will be calculated according to the fulfilment%.

The Annual General Meeting 2025 decided on SKF''s Performance Share Programme 2025. The programme covers senior
managers and key employees in the SKF Group, including Group Management, with an opportunity of being allotted, free of
charge, SKF B shares. Under the programme, not more than 1,000,000 SKF B shares may be allotted. The allotment of shares
shall be related to the level of achievement of the total value added (TVA) target, as defined by the Board of Directors, and
the SKF Group''s CDP Climate Change score. The TVA performance measure is weighted 80% and the CDP Climate Change
score performance measure is weighted 20%. The performance period is three years. Over the three-year programme period,
the TVA performance target range is set annually by the Board against the baseline of the actual TVA achieved in the
previous year. In order for allocation of shares to take place the average TVA development must exceed a certain minimum
level (the threshold level). In addition to the threshold level, a target level is set. Maximum allotment is awarded if the target
level is reached or exceeded.

10% of the maximum allocation is based on the reduction of CO2e emissions. After the expiry of the financial year 2025, a
comparison will be made of the level of CO2e emissions reduction achieved during the programme period and the net zero
2030 objective trajectory. If the trajectory reduction level is met or exceeded full allotment is awarded, i.e. 10% of the total
maximum allotment under the programme. If the reduction does not meet the trajectory level, no allotment is awarded in
relation to this part of the programme.

The CDP Climate Change score is based on an extensive questionnaire requiring disclosure and performance in the 11
different categories.

Performance Categories

Business strategy, financial planning & scenario analysis

Emissions reduction initiatives

Energy

Governance

Opportunity disclosure

Risk disclosure

Risk management processes

Scope 1 & 2 emissions

Scope 3 emissions

Targets

Value chain engagement

This comprehensive assessment and the resulting score are known across the investor and customer communities as a
credible third-party view on companies'' approaches to climate change.

The score ranges from A (leadership level) to D- (disclosure level). SKF received an A- score in 2025.

This is higher than the latest available average scores for Europe (B) and the metal product manufacturing sector (C). The
overall performance achievement for the CDP Climate Change score is the weighted average of the annual performance
achievement, based on the criteria in the table. For example, if SKF''s CDP score is B in year 1, A- in year 2 and A in year 3,
the overall performance achievement for the full programme period is 75% ((50% 75% 100%)/3).

43. Additional regulatory information required by Schedule III(i) Details of benami property held

No proceedings have been initiated on or are pending against the Company under the Benami Transactions (Prohibition)
Act, 1988 (45 of 1988) and Rules made thereunder.

(ii) Borrowing secured against current assets

The Company has no borrowings from banks and financial institutions except for unsecured working capital limit
sanctioned from banks.

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

(iii) Wilful defaulter

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

(iv) Relationship with struck off companies

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

(v) Compliance with number of layers of companies

The Company does not have any investments through more than two layer of investment companies as per section
2(87)(d) and section 186 of Companies Act, 2013

(vi) Utilisation of borrowed funds and share premium

The Company has not advanced or loaned or invested funds to any other person or entity, including foreign entities
(Intermediaries) with the understanding that the Intermediary shall:

a. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf
of the Company (Ultimate Beneficiaries) or

b. provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries

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

a. directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf
of the Funding Party (Ultimate Beneficiaries) or

b. provide any guarantee, security or the like on behalf of the ultimate beneficiaries

(vii) Undisclosed income

There is no income surrendered or disclosed as income during the current or previous year in the tax assessments
under the Income Tax Act, 1961, that has not been recorded in the books of account.

(viii) Details of crypto currency or virtual currency

The Company has not traded or invested in crypto currency or virtual currency during the current or previous year.

(ix) Valuation of Property Plant and Equipment, intangible asset and investment property

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. All immovable property (including leases) are in the name of Company except
as disclosed in note 3a.

44. The Company did not have accounting system for maintaining its books of accounts and being maintained manually
in a Microsoft Excel file for the period 17^th December, 2024 to 31^st March, 2025 and April 01, 2025 to 30^th September
2025. The Company had very minimal transactions and was in the process of setting-up of its operations.

Further on, for the period 17^th December, 2024 to 31^st March, 2025 and 1^st April, 2025 to 30^th September 2025 (included
in year ended 31^st March, 2026), as reported and included in these financial statement, have been extracted by the
Management from the financial information of SKF India Limited which pertains to Industrial Undertaking (“Demerged
Undertaking") in accordance with Appendix C to Ind AS 103 “Business Combinations".

45. The figures for the previous year/period have been regrouped/reclassified wherever necessary to confirm to the
current year''s presentation.