ಕಂಪನಿಯ ಅಕೌಂಟಿಗ್ ಪಾಲಿಸಿ Vikram Solar Ltd.

Mar 31, 2026

1 Corporate Information

Vikram Solar Limited (“The Company") is domiciled and incorporated as a public limited company in India under the provisions of the Companies Act, 2013. The Registered office of the Company is situated at Bio Wonder, Unit No. 1102, 11^th Floor, 789, Anandapur Main Road, Eastern Metropolitan Bypass, Kolkata - 700107. The Company has completed its Initial Public Offer (IPO) during the year and accordingly the Company is listed on National Stock Exchange of India Limited (NSE) and BSE Limited (BSE) on August 26, 2025.

The Company is engaged in the business of manufacturing and sale of Solar photovoltaic modules/systems. The manufacturing facilities are situated at Falta Special Economic Zone (SEZ), West Bengal, at Vallam and at Oragadam, Tamil Nadu. The Company is also engaged into setting up of the Solar Power Plant/Systems and provides operation & maintenance services.

These standalone financial statements were approved and authorized for issue in accordance with a resolution of the Board of Directors on May 7, 2026. The standalone financial statements once approved by the Board of Directors need to be adopted by the shareholders at the annual general meeting of the Company.

2 Material accounting policies

2.1 Basis of Preparation and Presentation of Financial Statements

This note provides a list of the Material accounting policies adopted in the preparation of these standalone financial statements. These policies have been consistently applied to all the years presented, unless otherwise stated.

(a) Statement of Compliance with Ind AS

These standalone financial statements comply in all material aspects with Indian Accounting Standards (Ind AS) notified under Section 133 of the Companies Act, 2013 (the ''Act'') and read with [Companies (Indian Accounting Standards) Rules, 2015] (as amended from time to time) and other relevant provisions of the Act. These standalone financial statements has also been prepared in compliance with presentation requirement of Division II of Schedule III to the Companies Act, 2013 (“IND AS Compliant Schedule III"), as applicable to the standalone financial statements.

(b) Basis of measurement

The standalone financial statements have been prepared on an accrual basis and under the historical cost convention, except for certain financial instruments and share based payment that are measured at fair value as required by the relevant Ind AS (refer Note 2.13 and 2.14 for

accounting policy on financial instruments and employee benefits respectively).

(c) Presentation currency and rounding off

The Company''s standalone financial statements are reported in Indian Rupees (H), which is also the Company''s functional currency, and all values are rounded to the nearest millions (H 000,000), except when otherwise indicated.

(d) Going concern

The Company has prepared the standalone financial statements on the basis that it will continue to operate as a going concern.

(e) Current and Non-Current Classification

The Company presents assets and liabilities in the balance sheet based on current/non current classification. An asset is classified as current when it satisfies any of the following criteria:

a) it is expected to be realised in, or is intended for sale or consumption in, the Company''s normal operating cycle.

b) it is held primarily for the purpose of being traded;

c) it is expected to be realised within 12 months after the reporting date; or

d) it is cash or cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least 12 months after the reporting date.

All other assets are classified as non-current.

A liability is classified as current when it satisfies any of the following criteria:

a) it is expected to be settled in the Company''s normal operating cycle;

b) it is held primarily for the purpose of being traded;

c) it is due to be settled within 12 months after the reporting date;

d) it does not have the right at the end of the reporting period to defer settlement of the liability for at least twelve months after the reporting period.;

All other liabilities are classified as non-current.

Deferred tax assets and liabilities are classified as noncurrent assets and liabilities.

The operating cycle is the time between the acquisition of assets for processing and their realisation in cash and cash equivalents. The Company has identified its operating cycle as 12 months.

(f) Critical accounting judgements, estimates and assumptions

The preparation of standalone financial statements in conformity with Ind AS requires the Management to make judgements, estimates and assumptions regarding the future that affect the reported amounts and disclosures. The Company based its assumptions and estimates on parameters available when the standalone financial statements were prepared and reviewed at each Balance Sheet date. Uncertainty about these assumptions and estimates could result in outcomes that may require a material adjustment to the reported amounts and disclosures are discussed below.

(i) Employee benefit plans - Note 2.14 and 42

Post-employment benefits represents obligation that will be settled in the future and require assumptions to project benefit obligations. The cost of postemployment benefit is 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.

(ii) Provision for expected credit losses of trade receivables- Note 2.13.a and 10

The measurement of expected credit loss on trade receivable is based on the evaluation of collectability and the management''s judgement considering external and internal sources of information. A considerable amount of judgement is required in assessing the ultimate realisation of the receivables having regard to, the past collection history of each party and ongoing dealings with these parties.

The risk of delay in collection of accounts receivable is primarily estimated based on prior experience with, and the past due status of debtors, while large accounts are assessed individually based on factors that include ability to pay, bankruptcy and payment history. The assumptions and estimates applied for determining the allowance of expected credit loss are reviewed periodically.

(iii) Useful lives and residual values of property, plant and equipment - Note 2.2 and 4

Property, plant and equipment are depreciated at historical cost using straight-line method based on

the estimated useful life, taking into account their residual value. The asset''s residual value and useful life are based on the Company''s best estimates and reviewed, and adjusted if required, at each Balance Sheet date taking into consideration the estimated usage of the assets, operating condition of the assets and anticipated technological changes etc.

(iv) Fair Value Measurements

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 values are measured using valuation techniques which involve various judgements and assumptions. Judgements include consideration of inputs such as liquidity risk, credit risk and volatility. Changes in the assumption about these factors could affect the reported fair value of financial instruments. Refer Note 52 for further disclosures.

(v) Contingent Liabilities - Note 2.11 and 44

The Company has contingent liabilities arising from various matters that are currently pending.Due to the uncertainty inherent in such matters, it is often difficult to predict the final outcomes. The cases and claims against the Company often raise difficult and complex factual and legal issues that are subject to many uncertainties and complexities, including but not limited to the facts and circumstances of each particular case and claim, the jurisdiction and the differences in applicable law, in the normal course of business, the Company consults with experts on matters related to litigations. The Company accrues a liability when it is determined that an adverse outcome is probable and the amount of the loss can be reasonably estimated. In the event an adverse outcome is possible or an estimate is not determinable, the matter is disclosed.

(vi) Revenue Recognition

The Company uses the proportionate completion method for recognition of revenue, accounting for unbilled revenue/unearned revenue and contract cost thereon for its turnkey contracts. Unbilled revenue represents value of services rendered but not yet been invoiced on the reporting date due to contractual terms. The percentage of completion is measured by reference to the stage of the projects and contract determined based on the proportion of contract costs incurred for work performed to date bear to the estimated total contract costs. Use of the proportionate completion method requires the Company to estimate the efforts or costs incurred

to date as a proportion of the total efforts or cost to be incurred. Significant assumptions are required in determining the stage of completion, the extent of the contract cost incurred, the estimated total contract revenue and contract cost and the recoverability of the contracts. These estimates are based on events existing at the end of each reporting date.

(vii) Share-based payments

Estimating fair value for share-based payment transactions requires determination of the most appropriate valuation model, which is dependent on the terms and conditions of the grant. This estimate also requires determination of the most appropriate inputs to the valuation model including the expected life of the share option, volatility and dividend yield and making assumptions about them. The Black Scholes valuation model has been used by the Management for sharebased payment transactions. The assumptions and models used for estimating fair value for share based payment transactions are disclosed in Note 43.

(viii) Provision for warranty

The warranty obligations and estimations thereof are determined using historical information on the type of product, nature, frequency and average cost of warranty claims and the estimates regarding possible future incidences of product failures. Changes in estimated frequency and amount of future warranty claims, which are inherently uncertain, can materially affect warranty expense.

(ix) Leases

The Company evaluates if an arrangement qualifies to be a lease as per the requirements of Ind As 116 “Leases". Identification of a lease requires significant judgement in assessing the terms and conditions of the arragement including lease term, anticipated renewals and the applicable discount rate. The lease payments are discounted using the interest rate implicit in the lease, if that rate can be readily determined. If that rate cannot be readily determined, the Company uses incremental borrowing rate.

2.2 Property, plant and equipment

Property, Plant and Equipment are initially recognised at cost. The cost includes the purchase price, directly attributable costs and the estimated present value of any future unavoidable costs of dismantling and removing items. Subsequent costs are included in the asset''s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognized when replaced. All other repairs and maintenance is recognised in profit or loss during the year in which they are incurred.

Advances paid towards the acquisition of property, plant and equipment outstanding at each balance sheet date is classified as capital advances under other non-current assets and the cost of assets not put to use before such date are disclosed under ''Capital work-in-progress''. CWIP is stated at cost, net of accumulated impairment loss, if any.

Depreciation methods, estimated useful lives

Freehold land is not depreciated. Depreciation on assets under construction does not commence until they are complete and available for use. Depreciation is provided on all other items of property, plant and equipment so as to write off their carrying value over their expected useful economic lives as follows.

Property, plant and equipment	Useful Life
Building	30- 60 years
Furniture and Fixtures	10 years
Vehicles	8- 10 years
Office Equipment	3-5 years
Plant & Equipment	5- 10 years
Electrical Installation	10 years
Computers & Accessories	3-6 years

The Company, based on technical assessment made by technical expert and management estimate, depreciates certain items of tools, plant & machinery and other handling equipment over estimated useful lives which are different from the useful life prescribed in Schedule II to the Companies Act, 2013. The management believes that these estimated useful lives are realistic and reflect fair approximation of the period over which the assets are likely to be used.

The Company reviews the estimated residual values and expected useful lives of assets at least annually. In case of change in estimated life, depreciation is provided prospectively over the remaining useful life of such assets.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the statement of profit and loss when the asset is derecognised.

The carrying amounts of assets are reviewed at each Balance Sheet date to determine if there is any indication of impairment based on external or internal factors. An impairment loss is recognised wherever the carrying amount of an asset exceeds its recoverable amount which represents the greater of the net selling price of assets and their ''value in use''. The estimated future cash flows are discounted to their present value using pre-tax discount rates and risks specific to the asset.

2.3 Intangible Assets

Intangible assets are recognised when it is probable that the future economic benefits that are attributable to the assets will flow to the Company and the cost of the asset can be measured reliably. Externally Acquired intangible assets are initially recognised at cost and subsequently amortised on a straight-line basis over their useful economic lives.

Amortization of Intangible assets

The useful lives of intangible assets is based on the management estimates. The useful lives so determined are as follow

Intangible assets	Useful life
Computer Software	3 - 5 years
Trade Mark & Copyrights	3 years
Product Certifications	3 - 5 years

Useful life and methods of amortisation of Intangible assets are reviewed periodically, with the effect of any changes in estimate being accounted for on a prospective basis.

Internally generated intangible assets (development costs)

Expenditure on internally developed products is capitalised if it can be demonstrated that:

(i) it is technically feasible to develop the product for it to be sold

(ii) adequate resources are available to complete the development

(iii) there is an intention to complete and sell the product

(iv) the Group is able to sell the product

(v) sale of the product will generate future economic benefits, and

(vi) expenditure on the project can be measured reliably.

Development expenditure not satisfying the above criteria and expenditure on the research phase of internal projects are recognised in the standalone statement of profit and loss as incurred.

Capitalised development costs are amortised over the periods the Company expects to benefit from selling the products developed. The amortisation expense is included within the ''depreciation and amortisation expense'' in the standalone statement of profit and loss.

2.4 Rounding off amounts

All amounts disclosed in standalone financial statements and notes have been rounded off to the nearest million as per requirement of Schedule III of the Act, unless otherwise stated. Any amount appearing as H 0.00 represents amount less than H 5,000.

2.5 Borrowing costs

Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalized as part of the cost of asset till such time the asset is ready for its intended use. A qualifying asset is an asset that necessarily requires a substantial period of time (generally over twelve months) to get ready for its intended use. Borrowing costs consist of interest and other costs that a Company incurs in connection with the borrowing of fund. All other borrowing costs are expensed in the period in which they are incurred.

Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.

2.6 Foreign Currency Transactions

The Company''s functional and reporting currency is Indian Rupee H.

On initial recognition, all foreign currency transactions are recorded by applying to the foreign currency amount the exchange rate between the functional currency and the foreign currency at the date of the transaction. Gains/ losses arising out of fluctuation in foreign exchange rates between the transaction date and settlement date are recognised in the profit and loss.

Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency spot rates of exchange at the reporting date and the exchange differences are recognised in the profit and loss.

Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates at the dates of the initial transactions.

2.7 Revenue Recognition

Sale of goods and rendering of services

Revenue from contracts with customers is recognised when control of the goods or services are transferred to the customer at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The Company has concluded that it is the principal in its revenue arrangements with the customer because the Company typically controls the goods or services before transferring them to the customer.

Revenue is generally adjusted for variable consideration such as discounts, rebates, refunds, credits, price concessions, incentives, liquidated damages or other similar deductions in a contract except when it is highly probable it will not be provided. The amount of revenue excludes any amount collected on behalf of third parties.

Revenue from sales of goods is recognised at the point in time when control of the asset is transferred to the customer.

Revenues from turnkey contracts, which are generally time bound fixed price contracts are recognised over the life of the contract using the proportionate completion method with contract costs of determining the degree of completion. Foreseeable losses on such contracts are recognised when probable.

Revenue on installation and commissioning contracts are recognised as per the terms of contract.

Revenue from maintenance contracts are recognised pro rata over the period of the contract.

Other Income

Interest income from a financial asset is recognised when it is probable that the economic benefits will flow to the Company and the amount of income can be measured reliably. Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset''s net carrying amount on initial recognition.

Insurance claims are accounted for on the basis of claims admitted/ expected to be admitted and to the extent there is no uncertainty in receiving the claims.

2.8 Taxes

Tax expense for the year, comprising current tax and deferred tax, are included in the determination of the net profit or loss for the year.

(a) Current income tax

The Income tax expense or credit for the period is the tax payable on the current period''s taxable income based on the applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences.

Current income tax assets and liabilities are measured at the amount expected to be recovered or paid to the taxation authorities, based on the rates and tax laws enacted or substantively enacted, at the reporting date in the country where the entity operates and generates taxable income. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.

Current income tax relating to items recognised directly in equity is recognised in equity and not in the Statement of Profit and Loss.

Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.

(b) Deferred tax

Deferred tax is provided using the balance sheet approach on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts for the financial reporting purposes at the reporting date. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised, or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.

Deferred tax liabilities are recognised for all taxable temporary differences, except:

(i) When the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss and does not give rise to equal taxable and deductible temporary differences.

(ii) In respect of taxable temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, when the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.

Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised, except:

(i) When the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss and does not give rise to equal taxable and deductible temporary differences.

(ii) In respect of deductible temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, deferred tax assets are recognised only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary differences can be utilised.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax assets are re-assessed at each reporting date and are recognised to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and liabilities and when the deferred tax balances relate to the same taxation authority.

Minimum alternate tax (MAT) paid in a period is charged to the Statement of Profit and Loss as current tax. The Company recognises MAT credit available as an asset only to the extent that there is convincing evidence that the Company will pay normal income tax during the specified period, i.e., the period for which MAT credit is allowed to be carried forward. The Company reviews the “MAT credit entitlement" asset at each reporting date and writes down the asset to the extent the Company does not have convincing evidence that it will pay normal income tax during the specified period.

Deferred tax is recognized in Statement of Profit and Loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.

2.9 Leases

The Company assesses whether a contract is, or contains, a lease at contract inception or upon the modification of a contract. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

As a lessee

The Company applies a single recognition and measurement approach for all leases, except for short-term leases and leases of low-value assets. The Company recognises lease liabilities to make lease payments and right-of-use assets representing the right to use the underlying assets.

(i) Right-of-use assets

The Company recognises right-of-use assets at the commencement date of the lease (i.e., the date the underlying asset is available for use). Right-of-use assets are measured at cost, less any accumulated depreciation and impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities recognised, initial direct costs incurred, and lease payments made at or before the commencement date less any lease incentives received. Right-of-use assets are depreciated on a straight-line basis over the shorter of the lease term and the estimated useful lives of the assets.

The Company applies a single recognition and measurement approach for all leases, except for short-term leases and leases of low-value assets. The Company recognises lease liabilities to make lease payments and right-of-use assets representing the right to use the underlying assets.

If the Company is reasonably certain to exercise a purchase option, the right-of-use asset is depreciated over the underlying asset''s useful life. Lease liability

and ROU asset have been separately presented in the Balance Sheet and lease payments have been classified as financing cash flows.

Right of use assets are assessed for impairment whenever there is an indication that the balance sheet carrying amount may not be recoverable using cash flow projections for the useful life.

(ii) Lease Liabilities

At the commencement date of the lease, the Company recognises lease liabilities measured at the present value of lease payments to be made over the lease term. The lease payments include fixed payments (including in substance fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate, and amounts expected to be paid under residual value guarantees. The lease payments are discounted using the interest rate implicit in the lease or, if not readily determinable, the Company incremental borrowing rate. Subsequently, the Company measures the lease liability by adjusting carrying amount to reflect interest on the lease liability and lease payments made.

The carrying amount of lease liabilities is remeasured along with a corresponding adjustment to the related right of use asset if there is a modification, a change in the lease term, a change in the lease payments (e.g., changes to future payments resulting from a change in an index or rate used to determine such lease payments) or a change in the assessment of an option to purchase the underlying asset.

Short-term lease and lease of low-value assets

The Company applies the short-term lease recognition exemption to its short-term leases of machinery and equipment (i.e., those leases that have a lease term of twelve months or less from the commencement date and do not contain a purchase option). It also applies the lease of low-value assets recognition exemption to leases of offices, godowns, equipment, etc. that are of low value. Lease payments on short-term leases and leases of low-value assets are recognised as expense on a straight-line basis over the lease term.

2.10 Inventories

Inventories are valued at the lower of cost and Net Realisable Value (NRV). However materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost.

Net realizable value is the estimated selling price in the ordinary course of business, less the estimated

cost of completion and the estimated costs necessary to make the sale.

Raw materials: cost includes cost of purchase and other costs incurred in bringing the inventories to their present location and condition. However, these items are considered to be realisable at cost, if the finished products, in which they will be used, are expected to be sold at or above cost. Cost is determined on weighted average basis.

Finished goods and work in progress: cost includes cost of direct materials and labour and a proportion of manufacturing overheads based on the actual level of production which approximates normal operating capacity.

Stores, spares and other supplies: cost includes cost of purchase and other costs incurred in bringing the inventories to their present location and condition. Cost is determined on weighted average basis.

Provision for obsolescence on inventories is considered on the basis of management estimate based on the demand and market of the inventories.

2.11 Provisions and contingent liabilities

Provisions are recognized when there is a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and there is a reliable estimate of the amount of the obligation.

When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, a receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably.

When the Company expects some or all of a provision to be reimbursed, for example, under an insurance contract, the reimbursement is recognised as a separate asset, but only when the reimbursement is virtually certain. The expense relating to a provision is presented in the Statement of Profit and Loss net of any reimbursement.

Present obligations arising under onerous contracts are recognised and measured as provisions.

Provisions for the expected cost of warranty obligations on sale of goods are recognised at the date of sale of relevant products, at the Management best estimate of the expenditure required to settle the Company''s obligation. These estimates are established using historical information on the nature, frequency and average cost of warranty claims and management estimates regarding possible future incidence based on corrective actions on product failures. The timing of outflows will vary as and when warranty claim will arise.

Contingent Liability is disclosed in the case of:

(i) A present obligation arising from the past events, when it is not probable that an outflow of resources will be required to settle the obligation;

(ii) A present obligation arising from the past events, when no reliable estimate is possible;

(iii) A possible obligation arising from the past events, unless the probability of outflow of resources is remote.

Commitments include the amount of purchase order (net of advances) issued to parties for completion of assets. Provisions, contingent liabilities and commitments are reviewed at each balance sheet date.

2.12 Cash and cash equivalents

Cash and cash equivalents in the balance sheet comprise balance with banks, cash on hand, cheques/ draft on hand and short-term deposits net of bank overdraft with an original maturity of three months or less, which are subject to an insignificant risk of changes in value. For the purposes of the cash flow statement, cash and cash equivalents include balance with banks, cash on hand, cheques/ draft on hand and short-term deposits net of bank overdraft.

2.13 Financial instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

(a) Financial assets Measurement

At initial recognition, the Company measures a financial asset at its fair value plus transaction costs that are directly attributable to the acquisition of the financial asset except in the case of financial asset not recorded at fair value through profit or loss.

Financial assets with embedded derivatives are considered in their entirety when determining whether their cash flows are solely payment of principal and interest.

Classification

The Company classifies its financial assets in the following measurement categories:

a) those to be measured subsequently at fair value (either through other comprehensive income (FVTOCI), or through profit or loss (FVTPL)), and

b) those measured at amortised cost.

The classification depends on the Company''s business model for managing the financial assets and the contractual terms of cash flows.

For assets measured at fair value, gains and losses is either recorded in the statement of profit and loss or other comprehensive income.

A financial asset is measured at amortised cost if it meets both of the following conditions and is not designated at FVTPL:

i. The asset is held within a business model whose objective is to hold assets to collect contractual cash flows; and

ii. The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

All equity investments in scope of Ind AS 109 are measured at fair value. Equity instruments which are held for trading and contingent consideration, recognised by an acquirer in a business combination to which Ind AS 103 applies are classified as at fair value through profit or loss. For all other equity instruments, the Company may make an irrevocable election to present in other comprehensive income subsequent changes in the fair value. The Company makes such election on an instrument-by-instrument basis. The classification is made on initial recognition and is irrevocable.

Impairment of financial assets

The Company assesses on a forward looking basis, the expected credit losses associated with its assets carrying at amortized cost and FVTOCI debt instruments. The impairment methodology applied depends on whether there has been a significant increase in credit risk. For trade receivables only, the Company applies the simplified approach permitted by Ind AS 109 Financial Instruments, which requires expected lifetime losses to be recognised from initial recognition of the receivables.

Derecognition of financial assets

A financial asset is derecognised only when

• The Company has transferred the rights to receive cash flows from the financial asset or

• retains the contractual rights to receive the cash flows of the financial asset, but assumes a contractual obligation to pay the cash flows to one or more recipients.

Fair value of Financial Instruments

In determining the fair value of financial instruments, the Company uses a variety of method and assumptions that are based on market conditions and risk existing at each reporting date. The methods used to determine fair value includes discounted cash flow analysis and available quoted market prices. All method of assessing fair value result in general approximation of fair value and such value may never actually be realised.

Investments in subsidiaries are stated at fair value. The Company''s management has elected to present fair value gains and losses on aforesaid investments in other comprehensive income, there is no subsequent reclassification of fair value gains and losses to the statement of profit and loss. Investments in units of mutual funds are accounted for at fair value and the changes in fair value are recognised in the Statement of Profit and Loss.

(b) Financial liabilities

The Company recognises a financial liability in its balance sheet when it becomes party to the contractual provisions of the instrument. All financial liabilities are recognized initially at fair value and, in the case of trade and other payable, loans and borrowings, net of directly attributable transaction costs.

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss or at amortised cost as appropriate.

Subsequent measurement

The measurement of financial liabilities depends on their classification, as described below:

(i) Financial liabilities at fair value through profit or loss

(ii) Financial liabilities measured at amortised cost

Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss. Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the near term. Gains or Losses, including any interest expense on liabilities held for trading are recognised in the Statement of Profit and Loss.

Financial liabilities at amortised cost

After initial recognition, interest-bearing financial liabilities at amortised cost are subsequently measured at amortised

cost using the EIR method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortisation process.

Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs in the statement of profit and loss.

Supplier finance arrangements

The Company also classifies financial liabilities from supplier finance arrangements as trade payables if they are of the same nature and has terms comparable to regular trade payables. This applies when the arrangement is part of the normal operating cycle and has similar security levels. The related cash flows are included in operating activities in the standalone statement of cash flows.

Derecognition of financial liabilities

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the statement of profit and loss.

Offsetting of financial instruments

Financial assets and financial liabilities are offset and the net amount is reported in the standalone balance sheet if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis or to realise the assets and settle the liabilities simultaneously.

2.14 Employee Benefits A Short term employee benefits

All employee benefit that are expected to be settled wholly within 12 months after the end of the reporting period are treated as short-term employee benefits and presented as current liabilities. The Company recognises expected cost of short-term employee benefit as an expense, when an employee renders the related service.

B Post-employment benefits (i) Defined contribution plan

Contributions to defined contribution schemes are charged to the profit and loss in the year to which they relate.

(ii) Defined benefit plans

Gratuity: The Company provides for gratuity, a defined benefit plan covering eligible employees in accordance with the Code on social security, 2020. The Gratuity Plan provides a lump sum payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee''s salary. The Company''s liability is actuarially determined (using the Projected Unit Credit method) at the end of each year.

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

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

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

(ii) Net interest expense or income

Compensated absence: The Company provides for the sick leave and encashment of earned leave subject to certain rules. The employees are entitled to accumulate earned leave and sick leave subject to certain limits, for future utilization or encashment. The liabilities for earned leave and sick 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 annually by actuaries 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 recognized in the statement of profit and loss.

Share based payment: The cost of equity-settled transactions is determined by the fair value at the date when the grant is made using an appropriate valuation model. That cost is recognised, together with a corresponding increase in share options outstanding account in equity, over the period in which the performance and/or service conditions are fulfilled in employee benefits expense. The cumulative expense recognised for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Company best estimate of the number of equity instruments that will ultimately vest. The expense or credit in the statement of profit and loss for a period represents the movement in cumulative expense recognised as at the beginning and end of that period and is recognised in employee benefits expense. The dilutive effect of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share.

Service and non-market performance conditions are not taken into account when determining the grant date fair value of awards, but the likelihood of the conditions being met is assessed as part of the Company best estimate of the number of equity instruments that will ultimately vest. Market performance conditions are reflected within the grant date fair value. Any other conditions attached to an award, but without an associated service requirement, are considered to be non-vesting conditions. Non-vesting conditions are reflected in the fair value of an award and lead to an immediate expensing of an award unless there are also service and/or performance conditions.

No expense is recognised for awards that do not ultimately vest because non-market performance and/or service conditions have not been met. Where awards include a market or non-vesting condition, the transactions are treated as vested irrespective of whether the market or non-vesting condition is satisfied, provided that all other performance and/or service conditions are satisfied.

2.15 Government Grants

Government grants are not recognised until there is reasonable assurance that the Company will comply with the conditions attached to them and there is a reasonable certainty that grants will be received.

Government grants are recognised in profit or loss on a systematic basis over the periods in which the Company recognises as expenses the related costs for which the grants are intended to compensate.

Specifically, government grants whose primary condition is that the Company should purchase, construct or otherwise acquire non- current assets are recognised as deferred revenue in the balance sheet and transferred to profit or loss on a systematic and rational basis over the useful life of the related assets.

Government grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the Company with no future related costs are recognised in profit or loss in the period in which they become receivable.

2.16 Derivative financial instruments

The Company enters into foreign exchange forward contracts to manage its exposure to foreign currency risk. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently remeasured to their fair value at the end of each reporting period with changes included in other income / other expense in the Statement of Profit and Loss unless the derivate is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedging relationship and the nature of the hedged item.

2.17 Segment Reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision maker is responsible for allocating resources and assessing performance of the operating segments and has been identified as the Board of Director of the Company. Refer note 53.

2.18 Earnings Per Share

Basic earnings per share is calculated by dividing the net profit or loss attributable to equity shareholders by the weighted average number of equity shares outstanding during the year.

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

2.19 Share issue expenses

Equity shares of the Company are classified as equity share capital and are accounted for at par value. Any value realised over and above par value upon issuance of equity

shares are accounted for as ''Securities Premium'' under ''Other Equity''. Incremental costs directly attributable to the issuance of new equity shares, share options and buyback are recognized as a deduction from equity, net of any tax effects.

3 Recent accounting pronouncement

The Ministry of Corporate Affairs (MCA) has notified amendments vide the Companies (Indian Accounting Standards) Amendment Rules, 2025 dated 7 May 2025 and the Companies (Indian Accounting Standards) Second Amendment Rules, 2025 dated 13 August 2025. These amendments are applicable for annual reporting periods beginning on or after 1 April 2025.

(a) Amendment to Ind AS 7 and Ind AS 107 - Supplier Finance Arrangement:

The amendments to Ind AS 7, Statement of Cash Flows, and Ind AS 107, Financial Instruments: Disclosures, clarify the characteristics of supplier finance arrangements and introduce additional disclosure requirements for such arrangements. These disclosures are intended to enable users of financial statements to understand the effects of supplier finance arrangements on an entity''s liabilities, cash flows, and exposure to liquidity risk. The Company does not have any supplier finance arrangement during the reporting period.

(b) Amendment to Ind AS 1 - Classification of Liabilities as Current or Non-current and Noncurrent liabilities with covenants:

The amendment specifies the requirements for classifying liabilities as current or non-current in the balance sheet, and clarifies the following:

a) An entity''s right to defer settlement of a liability for at least twelve months after the reporting period must have substance and must exist at the end of the reporting period. The classification of a liability as current or non-current is unaffected by the likelihood that the entity will exercise its right to defer settlement.

b) If an entity''s right to defer settlement of a liability is subject to covenants, such covenants affect whether that right exists at the end of the reporting period only if the entity is required to comply with the covenant on or before the end of the reporting period.

c) In case of a Liability that can be settled, at the option of the counterparty, by the transfer of the entity''s own equity instruments, such settlement terms do not affect the classification of the liability as current or non-current only if the option is classified as an equity instrument.

These amendments have no effect on the measurement of any items in the standalone financial statements of the Company. The Company did not make retrospective adjustments as a result of adopting the amendments to Ind AS 1.

(c) Amendment to Ind AS 12 - Pillar-Two Tax Reforms

The Company is not within the scope of the OECD Pillar Two Model Rules, as Pillar Two legislation has not yet been enacted in any of the jurisdiction in which the Company operates.

(d) Amendment to Ind AS 21-Lack of exchangeability

The Amendments introduces requirement to assess when a currency is exchangeable into another currency and when it is not. The amendment requires an entity to estimate the spot exchange rate when it concludes that a currency is not exchangeable into another currency. These amendments had no effect on the standalone financial statements of the Company.

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Mar 31, 2025

1 General Information

Vikram Solar Limited ("" The Company"" ) is a public
limited company , incorporated under the provision of
Companies Act, applicable in India. The Registered office of
the Company is situated at Bio Wonder, Unit No. 1102, 11th
Foor, 789, Anandapur Main Road, Eastern Metropolitan
Bypass, Kolkata - 700107.

The Company is engaged in the business of manufacturing
and sale of Solar photovoltaic modules / systems. The
manufacturing facilities are situated at Falta Special
Economic Zone (SEZ), West Bengal and at Oragadam, Tamil
Nadu. The Company is also engaged into setting up of the
Solar Power Plant / Systems and provides operation &
maintenance services.

These standalone Financial Statement were approved and
authorized for issue with the resolution of the Board of
Directors on April 24, 2025.

2 Basis of Preparation and summary of Material
accounting policies

2.1 Basis of Preparation and Presentation of Financial
Statements

This note provides a list of the significant accounting
policies adopted in the preparation of these standalone
financial statements. These policies have been consistently
applied to all the years presented, unless otherwise stated.

(a) Statement of Compliance with Ind AS

These standalone financial statements comply in all
material aspects with Indian Accounting Standards
(Ind AS) notified under Section 133 of the Companies
Act, 2013 (the ''Act'') and read with [Companies (Indian
Accounting Standards) Rules, 2015] and other relevant
provisions of the Act.

(b) Basis of measurement

The financial statements have been prepared on a historical
cost convention on accrual basis, except for certain
financial instruments measured at fair value as required
by relevant Ind AS (Refer Note 2.13 for accounting policy on
financial instruments)

All assets and liabilities have been classified as current or
non-current as per the Company''s operating cycle and other
criteria set out in the Schedule III to the Companies Act,
2013. Based on the nature of operation and the time between
the rendering of supply & services and their realization in
cash and cash equivalents, the Company has ascertained its
operating cycle as twelve months for the purpose of current
and noncurrent classification of assets and liabilities.

The Company''s standalone financial statements are
reported in Indian Rupees (H), which is also the Company''s
functional currency, and all values are rounded to the nearest
millions (H 000,000), except when otherwise indicated.

(c) Significant accounting judgements, estimates and
assumptions

The preparation of financial statements in conformity with
Ind AS requires the Management to make judgements,
estimates and assumptions that affect the reported amounts
and disclosures. The Company based its assumptions
and estimates on parameters available when the financial
statements were prepared and reviewed at each Balance
Sheet date. Uncertainty about these assumptions and
estimates could result in outcomes that may require a
material adjustment to the reported amounts and disclosures.

(a) Employee benefit plans - Note 2.14 and 42

Post-employment benefits represents obligation that
will be settled in the future and require assumptions
to project benefit obligations. Post-employment
benefit accounting is intended to reflect the
recognition of future benefit cost over the employee''s
approximate service period, based on the terms
of plans and the investment and funding decisions
made. The accounting requires the company to make
assumptions regarding variables such as discount
rate, rate of compensation increase and future
mortality rates. Changes in these key assumptions
can have a significant impact on the defined benefit
obligations and benefit costs incurred.

(b) Impairment of trade receivables - Note 2.13.a and 10

The risk of delay collection of accounts receivable is
primarily estimated based on prior experience with, and
the past due status of debtors, while large accounts are
assessed individually based on factors that include ability
to pay, bankruptcy and payment history. The assumptions
and estimates applied for determining the allowance of
expected credit loss are reviewed periodically.

(c) Estimation of expected useful lives and residual values
of property, plants and equipment - Note 2.2 and 4

Property, plant and equipment are depreciated at
historical cost using straight-line method based on
the estimated useful life, taking into account their
residual value. The asset''s residual value and useful
life are based on the Company''s best estimates and
reviewed, and adjusted if required, at each Balance
Sheet date taking into consideration the estimated
usage of the assets, operating condition of the assets
and anticipated technological changes etc.

(d) Fair Value Measurements

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 values are measured using valuation techniques
which involve various judgements and assumptions.

(e) Contingent Liabilities - Note 2.11 and 43

Contingent Liabilities covering a range of matters are
pending against the Company. Due to the uncertainty
inherent in such matters, it is often difficult to predict
the final outcomes. The cases and claims against the
Company often raise difficult and complex factual and
legal issues that are subject to many uncertainties
and complexities, including but not limited to the facts
and circumstances of each particular case and claim,
the jurisdiction and the differences in applicable
law, in the normal course of business, the Company
consults with experts on matters related to litigations.
The Company accrues a liability when it is determined
that an adverse outcome is probable and the amount
of the loss can be reasonably estimated. In the event
an adverse outcome is possible or an estimate is not
determinable, the matter is disclosed.

(f) Revenue Recognition

The Company uses the proportionate completion
method for recognition of revenue, accounting for
unbilled revenue / unearned revenue and contract
cost thereon for its turnkey contracts. Unbilled
revenue represents value of services rendered but
not yet been invoiced on the reporting date due to
contractual terms. The percentage of completion is
measured by reference to the stage of the projects
and contract determined based on the proportion of
contract costs incurred for work performed to date
bear to the estimated total contract costs. Use of
the proportionate completion method requires the
Company to estimate the efforts or costs incurred
to date as a proportion of the total efforts or cost to
be incurred. Significant assumptions are required in
determining the stage of completion, the extent of the
contract cost incurred, the estimated total contract
revenue and contract cost and the recoverability of
the contracts. These estimates are based on events
existing at the end of each reporting date.

2.2 Property, plant and equipment

Property, Plant and Equipment, Capital Work in Progress
is stated at cost, net of accumulated depreciation and
accumulated impairment losses, if any. Cost comprises
of purchase price (net of tax credits), borrowing costs, if

capitalization criteria are met, commissioning expenses,
etc. up to the date the asset is ready for its intended use.
Freehold land is not depreciated.

Expenditure directly attributable to expansion projects is
capitalized. Administrative, general overheads and other
indirect expenditure (including borrowing costs) incurred
during the project period which are not related to the project nor
are incidental thereto, are expensed off when that are incurred.

Subsequent costs are included in the asset''s carrying
amount or recognized as a separate asset, as appropriate,
only when it is probable that future economic benefits
associated with the item will flow to the Company and the
cost of the item can be measured reliably. The carrying
amount of any component accounted for as a separate
asset is derecognized when replaced. All other repairs and
maintenance are charged to Statement of Profit and Loss
during the year in which they are incurred.

Advances paid towards the acquisition of property, plant
and equipment outstanding at each balance sheet date
is classified as capital advances under other non-current
assets and the cost of assets not put to use before such
date are disclosed under ''Capital work-in-progress''.

Depreciation methods, estimated useful lives

Depreciation is calculated on a straight-line basis using the
rates arrived at based on the useful lives estimated by the
management, or as per rates prescribed in the Schedule II
of the Companies Act, 2013.

The Company, based on technical assessment made by
technical expert and management estimate, depreciates
certain items of tools, plant & machinery and other
handling equipment over estimated useful lives which
are different from the useful life prescribed in Schedule II
to the Companies Act, 2013. The management believes
that these estimated useful lives are realistic and reflect
fair approximation of the period over which the assets are
likely to be used.

The Company re-assess the estimated useful life every year
and in case of change in estimated life, depreciation is provided
prospectively over the remaining useful life of such assets.

An item of property, plant and equipment is derecognised upon
disposal or when no future economic benefits are expected to
arise from the continued use of the asset. Any gain or loss
arising on the disposal or retirement of an item of property,
plant and equipment is determined as the difference between
the sales proceeds and the carrying amount of the assets and
is recognised in statement of profit and loss.

Depreciation on addition to property plant and equipment
is provided on pro-rata basis from the date of put to use.
Depreciation on sale/deduction from property plant and
equipment is provided up to the date preceding the date of
sale, deduction as the case may be.

Depreciation methods, useful lives and residual values
are reviewed periodically at each financial year end and
adjusted prospectively, as appropriate.

The carrying amounts of assets are reviewed at each
Balance Sheet date to determine if there is any indication
of impairment based on external or internal factors. An
impairment loss is recognised wherever the carrying
amount of an asset exceeds its recoverable amount which
represents the greater of the net selling price of assets and
their ''value in use''. The estimated future cash flows are
discounted to their present value using pre-tax discount
rates and risks specific to the asset.

2.3 Intangible Assets

Acquired intangible assets are initially measured at cost
and subsequently at cost less accumulated amortization
and accumulated impairment loss, if any.

Amortization of Intangible assets

Intangibles are amortized on a straight line basis over
the useful lives as given below, which is based on the
management estimates.

Intangible assets are amortized over their respective useful
economic lives and assessed for impairment whenever
there is an impairment indicator. The amortization expense
and the gain or loss on disposal, is recognized in the
statement of profit and loss.

2.4 Rounding off amounts

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

2.5 Borrowing costs

Borrowing costs that are directly attributable to the
acquisition, construction or production of an asset that
necessarily takes a substantial period of time to get
ready for its intended use are capitalized as part of the
cost of asset. All other borrowing costs are recognised as
expenditure in the period in which they are incurred.

Borrowing cost includes interest, amortization of ancillary
costs incurred in connection with the arrangement of
borrowings and exchange differences arising from foreign
currency borrowings to the extent they are regarded as an
adjustment to the interest cost.

2.6 Foreign Currency Transactions

The Company''s functional currency and reporting currency
is the same i.e. Indian Rupee(H).

Initial recognition of transactions in foreign currencies are
recorded in reporting currency by the Company at spot
rates at the date of transaction.

At the end of each reporting period, Foreign currency
monetary items are reported using the closing rate. Exchange
differences arising on settlement or translation of monetary
items are recognised in Statement of Profit and Loss.
Foreign currency non-monetary items measured at
historical cost are translated using the exchange rates at
the dates of the initial transactions.

2.7 Revenue Recognition

Sale of goods and rendering of services

Revenue from contracts with customers is recognised
when control of the goods or services are transferred to
the customer at an amount that reflects the consideration
to which the company expects to be entitle in exchange
for those goods or services. The Company has concluded
that it is the principal in its revenue arrangements with
the customer because the Company typically controls the
goods or services before transferring them to the customer.

Revenue from sales of goods is recognised at the point
in time when control of the asset is transferred to the
customer, generally on delivery.

Revenues from turnkey contracts, which are generally time bound
fixed price contracts are recognised over the life of the contract

using the proportionate completion method with contract costs
of determining the degree of completion. Foreseeable losses on
such contracts are recognised when probable.

Revenue on installation and commissioning contracts are
recognised as per the terms of contract.

Revenue from maintenance contracts are recognised pro
rata over the period of the contract.

Other Operating revenues

Exports entitlements are recognised when the right to
receive such incentives as per the applicable terms is
established, in respect of the exports made and when
there is no significant uncertainty regarding the ultimate
realisation/ utilization of such incentives.

Other Income

Interest Income is recognised using the effective interest
rate method. The effective interest rate is the rate that
exactly discounts estimated future cash receipts through
the expected life of the financial asset to the gross carrying
amount of a financial asset. When calculating the effective
interest rate, the Company estimates the expected cash
flows by considering all the contractual terms of the
financial instrument.

Dividend income is recognised when the Company''s right to
receive dividend is established by the reporting date.

Insurance claims are accounted for on the basis of claims
admitted/ expected to be admitted and to the extent there
is no uncertainty in receiving the claims.

2.8 Taxes

(a) Current income tax

Current tax assets and liabilities are measured at the
amount expected to be recovered or paid to the taxation
authorities. The tax rates and tax laws used to compute the
amount are those that are enacted or substantively enacted,
at the year end date. Current tax assets and tax liabilities
are offset where the entity has a legally enforceable right
to offset and intends either to settle on a net basis, or to
realize the asset and settle the liability simultaneously.
Management periodically evaluates positions taken in
tax returns with respect to situations in which applicable
tax regulation is subject to interpretation. It establishes
provisions where appropriate on the basis of amounts
expected to be paid to the tax authorities."

(b) Deferred tax

Deferred tax is recognised on temporary differences
arising between the tax bases of assets and liabilities and
their carrying amounts in financial statements. Deferred
tax is determined using tax rates (and laws) that have been
enacted or substantially enacted by the end of the year and
are expected to apply when the related deferred tax asset
is realised or the deferred income tax liability is settled.

Deferred tax assets are recognised for all deductible
temporary differences and unused tax losses and tax
credits only if it is probable that future taxable amounts will
be available to utilize those temporary differences, losses
and tax credits. The carrying amount of deferred tax assets
is reviewed at each Balance Sheet date and reduced to the
extent that it is no longer probable that sufficient taxable
profit will be available to allow all or part of the deferred tax
asset to be utilised. Unrecognised deferred tax assets are
re-assessed at each reporting date and are recognised to
the extent that it has become probable that future taxable
profits will allow the deferred tax asset to be recovered.

Deferred tax assets and liabilities are offset when there is
a legally enforceable right to offset current tax assets and
liabilities and when the deferred tax balances relate to the
same taxation authority.

In the situations where the Company is entitled to a tax holiday
under the Income Tax Act, 1961, no deferred tax (asset or
liability) is recognised in respect of temporary differences
which reverse during the tax holiday period, to the extent the
Company''s gross total income is subject to the deduction
during the tax holiday period. Deferred tax in respect of
temporary differences which reverse after the tax holiday
period is recognised in the year in which the temporary
differences originate. However, the Company restricts the
recognition of deferred tax assets to the extent that it has
become probable that sufficient future taxable profits will
be available against which such deferred tax assets can be
realised. For recognition of deferred taxes, the temporary
differences which originate first are considered to reverse first.

In case of tax payable as Minimum Alternative Tax (''MAT'')
under the provisions of the Income-tax Act, 1961, the credit
available under the Act in respect of MAT paid is recognised
as an asset only when and to the extent there is convincing
evidence that the Company will pay normal income tax
during the period for which the MAT credit can be carried
forward for set-off against the normal tax liability. MAT
credit recognised as a deferred tax asset is reviewed at
each balance sheet date and written down to the extent the
aforesaid convincing evidence no longer exists.

Current and deferred tax is recognized in Statement of
Profit and Loss, except to the extent that it relates to items
recognised in other comprehensive income or directly
in equity. In this case, the tax is also recognised in other
comprehensive income or directly in equity, respectively.

2.9 Leases

The Company assesses at contract inception whether
a contract is, or contains, a lease. That is, if the contract
conveys the right to control the use of an identified asset
for a period of time in exchange for consideration.

As a lessee

The Company applies a single recognition and measurement
approach for all leases, except for short-term leases and
leases of low-value assets. The Company recognises lease
liabilities to make lease payments and right-of-use assets
representing the right to use the underlying assets.

(i) Right-of-use assets

The Company recognises right-of-use assets at the
commencement date of the lease (i.e., the date the
underlying asset is available for use). Right-of-use
assets are measured at cost, less any accumulated
depreciation and impairment losses, and adjusted for any
remeasurement of lease liabilities. The cost of right-of-use
assets includes the amount of lease liabilities recognised,
initial direct costs incurred, and lease payments made
at or before the commencement date less any lease
incentives received. Right-of-use assets are depreciated
on a straight-line basis over the shorter of the lease term
and the estimated useful lives of the assets.

The right-of-use assets are also subject to impairment.

(ii) Lease Liabilities

At the commencement date of the lease, the Company
recognises lease liabilities measured at the present
value of lease payments to be made over the lease
term. The lease payments include fixed payments
(including in substance fixed payments) less any lease
incentives receivable, variable lease payments that
depend on an index or a rate, and amounts expected
to be paid under residual value guarantees.

In calculating the present value of lease payments, the
Company uses its incremental borrowing rate at the
lease commencement date because the interest rate
implicit in the lease is not readily determinable. After the
commencement date, the amount of lease liabilities is
increased to reflect the accretion of interest and reduced
for the lease payments made. In addition, the carrying
amount of lease liabilities is remeasured if there is a
modification, a change in the lease term, a change in

the lease payments (e.g., changes to future payments
resulting from a change in an index or rate used to
determine such lease payments) or a change in the
assessment of an option to purchase the underlying asset.

Short-term lease and lease of low-value assets

The Company applies the short-term lease recognition
exemption to its short-term leases of machinery and
equipment (i.e., those leases that have a lease term of
twelve months or less from the commencement date
and do not contain a purchase option). It also applies
the lease of low-value assets recognition exemption
to leases of offices, godowns, equipment, etc. that are
of low value. Lease payments on short-term leases
and leases of low-value assets are recognised as
expense on a straight-line basis over the lease term."

2.10 Inventories

Raw materials, packaging materials and stores and
spare parts are valued at lower of cost and net realizable
value. However, material and other items held for use in
production of inventories are not written down below cost if
the finished products in which they will be incorporated are
expected to be sold at or above cost.

Cost includes purchase price, (excluding those
subsequently recoverable by the enterprise from the
concerned revenue authorities), freight inwards and other
expenditure incurred in bringing such inventories to their
present location and condition.

Work in progress and Finished Goods are valued at
lower of cost and net realisable value. Cost includes cost
of direct materials and direct labour and a proportion
of manufacturing overhead based on the normal
operating capacity. Cost is determined on monthly
weighted average basis.

Net realizable value is the estimated selling price in
the ordinary course of business, less the estimated
cost of completion and the estimated costs necessary
to make the sale.