Nature of reserves Capital reserve

Capital reserve comprises of money received against forfeiture of equity shares and preference share warrants. The reserve is not available for distribution as dividend. The reserve can be utilised in accordance with the specific provisions of Companies Act, 2013.

Securities premium:

Securities premium comprises of the premium on issue of shares. The reserve can be utilised in accordance with the specific provision of the Companies Act, 2013.

General reserve

General reserve is a free reserve and is utilised from time to time for appropriate purposes.

Retained earnings

Retained earnings refer to the net profit/(loss) retained by the Company for its core business activities.

Other comprehensive income

Other comprehensive income comprise of re-measurement of defined benefit liability.

* Matter under dispute with Maharashtra State Electricity Distribution Company Limited and is pending for hearing with Nagpur bench, Bombay High Court.

# It is not practicable for the Company to estimate the timing of cash outflows, if any, in respect of the above pending resolution of respective proceedings.

Note 1:

(i) . Out of the above litigations, the Company has provided ? 27.41 crores (31 March 2025 : ? 27.41 crores) against various litigations

and remaining contingent liabilities is ? 63.79 crores (31 March 2025 : ? 97.07 crores).

(ii) Customs duty claims (including penalties) against the Company aggregating to ? 220.26 crores (31 March 2025 : ? 220.26 crores) have not been considered contingent as favourable orders have been received, in some of the cases, by the Company from the Custom Excise and Service Tax Appellate Tribunal. The Company believes that its position is strong in this regard. The matter is pending with the Hon'ble Supreme Court (Rs 214.25 crores) and Custom Excise and Service Tax Appellate Tribunal (Rs 6.01 crores). Pending resolution of the respective proceedings, it is not practicable for the Company to estimate the timings of cash outflows, if any, in respect of the above as it is determinable only on receipt of judgements/decisions pending with respective forums/ authorities.

(iii) .The Company has reviewed all its pending litigations and proceedings and has adequately provided for where provisions are required and disclosed as contingent liabilities where applicable, in its standalone financial statements. The Company also believes that the above issues, when finally settled, are not likely to have any significant impact on the financial position of the Company. The Company does not expect any reimbursements in respect of the above contingent liabilities.

1. Bank balances other than cash and cash equivalents exclude earmarked balance and unclaimed dividend.

2. Other current assets includes all other current assets except prepaid expense.

3. Property, plant and equipment excludes assets amounting to ? 1.48 crores ( March 31, 2025: ? 2.86 crores ) as provided under schedule IV of the Memorandum of Entry dated 14 December 2020 and those provided under schedule III of the Memorandum of Entry dated 06 May 2021 executed in favor of banks by the Company.

4. Other non-current assets includes only capital advances for the purpose of assets under charge.

38. Employee benefits

a) Defined contribution plan

An amount of ? 6.01 crores [31 March 2025 : ? 5.74 crores] for the year has been recognised as an expense in respect of the Company’s contributions towards Provident Fund, an amount of ? 0.03 crores [31 March 2025 : ? 0.03 crores] for the year has been recognised as an expense in respect of Company’s contributions towards Employee State Insurance and an amount of ? 0.27 crores [31 March 2025 : ? 0.28 crores] for the year has been recognised as an expense in respect of the Company’s contributions towards National Pension Scheme, which are deposited with the government authorities and have been included under employee benefit expenses in the Statement of Profit and Loss.

b) Defined benefit plan 1) Gratuity

The Company provides for gratuity as per the Code on Social Security, 2020, forming part of the Labour Codes notified by the Government of India on November 21, 2025, employees who are in continuous years of service as defined under Code on Social Security,2020. The amount of gratuity payable on retirement/termination is computed on the basis of wages as defined under the Code on Wages, 2019, proportionately for 15 days of wages multiplied by the number of years of service. Reconciliation of opening and closing balances of the present value of the defined benefit obligation:

These assumptions were developed by management with the assistance of independent actuarial appraisers. Discount factors are determined close to each year end by reference to government bonds of relevant economic markets and that have terms to maturity approximating to the terms of the related obligation. Other assumptions are based on management’s historical experience.

The above defined benefit plan exposes the Company to following risks:

Interest rate risk:

The defined benefit obligation calculated uses a discount rate based on government bonds. If bond yields fall, the defined benefit obligation will tend to increase.

Salary inflation risk:

Expected increases in salary will increase the defined benefit obligation.

Demographic risk:

This is the risk of variability of results due to unsystematic nature of decrements that include mortality, withdrawal, disability and retirement. The effect of these decrements on the defined benefit obligation is not straight forward and depends upon the combination of salary increase, discount rate and vesting criteria. It is important not to overstate withdrawals because in the financial analysis the retirement benefit of a short career employee typically costs less per year as compared to a long service employee.

Funding

This is an unfunded benefit plan for qualifying employees.

(vi) Sensitivity analysis for gratuity liability

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

40. Segment information

Basis of segmentation:

The Company's primary business segment is reflected based on principal business activities carried on by the Company. Chairman and Managing Director has been identified as being the Chief Operating Decision Maker ('CODM') and evaluates the Company's performance and allocates resources based on analysis of the various performance indicators of the Company as a single unit. As per Indian Accounting Standard 108, Operating Segments, as notified under the Companies (Indian Accounting Standards) Rules 2015, the Company operates in one reportable business segment i.e., manufacturing and trading of polyester goods.

Geographical information:

The geographical information analyses the Company’s revenue and trade receivables from such revenue in India and other countries. In presenting the geographical information, segment revenue and receivables has been based on the geographic location of customers.

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

- credit risk

- liquidity risk

- market risk

(i) Risk management framework

The Company’s board of directors has overall responsibility for the establishment and oversight of the Company’s risk management framework. The board of directors has established the risk management committee, which is responsible for developing and monitoring the Company’s risk management policies. The committee reports regularly to the board of directors on its activities.

The Company’s risk management policies are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company’s activities.

The Company’s risk committee oversees how management monitors compliance with the Company’s risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the Company. The audit committee is assisted in its oversight role by internal audit. Internal audit undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which are reported to the audit committee.

(ii) Credit risk

The Company assesses and manages credit risk of financial assets based on following categories arrived on the basis of assumptions, inputs and factors specific to the class of financial assets.

A: Low credit risk on financial reporting date B: Moderate credit risk C: High credit risk

The credit risk for cash and cash equivalents and other bank balances is considered negligible, since the counterparties are reputable banks with high quality external credit ratings. Loan is given to subsidiaries. Accordingly, credit risk for loan is considered negligible. The credit risk for claims and receivables is considered negligible, since the counterparties are Government bodies.

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations and arises principally from the Company's receivables from customers.

The carrying amounts of financial assets represent the maximum credit risk exposure.

Trade receivables

The Company’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. However, management also considers the factors that may influence the credit risk of its customer base, including the default risk associated with the industry and country in which customers operate. The Company's significant payment terms range from 30 days to 90 days.

The risk management committee has established a credit policy under which each new customer is analysed individually for creditworthiness before the Company’s standard payment and delivery terms and conditions are offered. The Company review includes external information, if they are available, financial statements, credit agency information, industry information and in some cases bank references. Credit limits are established for each customer and reviewed periodically. Any sales exceeding those limits require approval from the risk management committee.

The Company limits its exposure to credit risk from trade receivables by establishing a credit period for all customer categories. In case of delay beyond credit period, the interest is generally recovered at the rate of 12% to 18%. Most of the Company’s customers have been transacting with the Company from past few years, and most of these customers’ balances are not credit-impaired at the reporting date except in few cases reported. Identifying concentrations of credit risk requires judgement in the light of specific circumstances. The Company monitors ageing of its trade receivables regularly and based on the same takes corrective action. Trade receivables having ageing more than 180 days is monitored individually and loss allowance is created based on such assessment.

(iv) Market risk

Market risk is the risk that changes in market prices - such as foreign exchange rates, interest rates and commodity prices - will affect the Company’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return.

Commodity price risk

Commodity price risk arises due to fluctuation in prices of crude oil. The Company has a risk management framework aimed at prudently managing the risk arising from the volatility in commodity prices and freight costs. The Company’s commodity risk is managed centrally through well-established control processes. In accordance with the risk management policy, the Company enters into various transactions using derivatives to hedge its exposure, as and when required. Further, selling price of finished goods and cost of raw materials fluctuates due to fluctuation in prices of crude oil and Company expects that the net impact of such fluctation would not be material.

Currency risk

The Company is exposed to currency risk to the extent that there is a mismatch between the currencies in which sales, purchases and borrowings are denominated. The currencies in which these transactions are primarily denominated are US dollars, Japanese Yen and Euro. The Company uses forward exchange contracts to hedge its currency risk, most with a maturity of less than one year from the reporting date, as and when required.

Interest rate risk i) Liabilities

The Company's policy is to minimise interest rate cash flow risk exposures on long term financing. The Company is exposed to changes in market interest rates through bank borrowings at variable interest rates.

The Company's policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. The primary objective of the Company's Capital Management is to maximise the shareholder's value. Management also monitors the return on capital. The board of directors seeks to maintain a balance between the higher returns that might be possible with higher levels of borrowing and the advantages and security afforded by a sound capital position.

Lease payments not recognised as a liability

The Company has elected not to recognise a lease liability for short-term leases (leases with an expected term of 12 months or less) or for leases of low value assets. Payments made under such leases are expensed on a straight-line basis. The Company does not have any liability to make variable lease payments for the right-to-use the underlying asset recognised in the financials. The expense relating to payments not included in the measurement of the lease liability for short-term leases and leases of low value is ? 11.87 crores (31 March 2025 : ? 12.40 crores).

At 31 March 2026, the Company was committed to short term-leases and leases of low value, and the total commitment as at that date was ?10.72 crores (31 March 2025 : ? 3.19 crores).

Total cash outflow for short term-leases and leases of low value for the year ended 31 March 2025 was ? 11.87 crores (31 March 2025 : ? 12.40 crores).

Total cash outflow for leases for the year ended 31 March 2026 was ? 14.95 crores (31 March 2025 : ? 16.76 crores).

43. Particulars of investments made and loans given as required by clause (4) of Section 186 of the Companies Act, 2013 and as required by Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 has been given under the investment schedule. Refer note 6(a) and note 7.

47. The Company carries an amount of ? 258.61 crore as deferred tax assets (net) as at 31 March 2026 as detailed in Note 9. The management of the Company is confident of generating sufficient taxable profits to realise aforesaid deferred tax assets based on future business projections which is supported by ongoing capacity expansion through Debottlenecking of the existing plants and favourable industry focussed trade policies of the Government that are expected to enhance the operations and profitability of the Company.

48. Per transfer pricing legislation under section 92-92F of the Income-tax Act 1961, the Company is required to use certain specific methods in computing arm’s length price of international transactions with associated enterprises and maintains adequate documentation in this respect. The legislations require that such information and documentation to be contemporaneous in nature. The Company has appointed independent consultants for conducting the Transfer Pricing Study to determine whether the transactions with associated enterprises undertake during the financial year are on an "arm's length basis". The Company is in the process of conducting a transfer pricing study for the current financial year and expects such records to be in existence latest by the due date as required by law. However, in the opinion of the management the update would not have a material impact on these financial statements. Accordingly, these standalone financial statements do not include any adjustments for the transfer pricing implications, if any.

Reasons for variance

Note 1 : Increase in earnings available for debt service in the current year in comparison to previous year resulting in improvement of ratio

Note 2 : Increase in net profit in the current year in comparison to previous year resulting in improvement of ratio

Note 3 : During the current year revenue has undergone an increase as compared to last year and there has been increase in

working capital due to higher current assets compare to last year. The same has resulted in improvement in the ratio.

Note 4 : Increase in net profit in the current year in comparison to previous year resulting in improvement of ratio

Note 5 : Increase in business activity (increase in sales and corresponding net purchases) in comparison to previous year that

leads to increase in earning before interest and taxes has resulted in improvement of ratio.

Notes :

(i) Current ratio = Current assets/ current liabilities

(ii) Debt equity ratio = Total debt/ shareholders equity

(iii) Debt service coverage ratio = Earnings available for debt service/ debt service (refer point (A) below)

(iv) Return on equity ratio = Net profits after taxes - preference dividend (if any)/ average shareholder’s equity

(v) Inventory turnover ratio = sales (excluding other operating income) /average inventory

(vi) Trade receivables turnover ratio = net credit sales/ avg. accounts receivable

(vii) Trade payables turnover ratio = Net credit purchases (comprise of purchase of raw materials stores & spares packing materials) / average trade payables

(viii) Net capital turnover ratio = net sales/ working capital

(ix) Net profit ratio= net profit/ net sales

(x) Return on capital employed (ROCE)= earning before interest and taxes/ capital employed (refer point (B) below)

(xi) Return on investment= income received from investments/ average investments. No income has been received on investment in the year ended 31 March 2026 and 31 March 2025 hence reported as nil.

Other explanatory points

(A) Earning for debt service = net profit after taxes non-cash operating expenses like depreciation and other amortizations Interest other adjustments like loss on sale of property, plant & equipment etc.

Debt service = interest & lease payments principal repayments

“Net profit after tax” means reported amount of “profit / (loss) for the period” and it does not include items of other comprehensive income.

(B) Capital employed = tangible net worth total debt deferred tax liability (asset)

50. Other statutory information

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

(b) The Company do not have any transactions with companies struck off.

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

(d) The Company have not traded or invested in Crypto currency or Virtual Currency during the financial year.

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

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

(ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries

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

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

(ii) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries,

(g) The Company have not any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961

(h) The Company is not declared wilful defaulter by any bank or financial institution or government or any government authority.

(i) The Company has been sanctioned a working capital limit by banks or financial institutions on the basis of security of current assets. Pursuant to the terms of the sanction letter(s),the Company is not required to file any quarterly return or statement with such banks or financial institutions.

51. The Government of India has consolidated multiple existing labour legisiations into a unified framework comprising four labour codes collectively referred as the "New Labour Codes”. The company has assessed and disclosed the incremental impact of these changes on the basis of guidance provided by the Institute of Chartered Accountants of India. Considering that the nature

of impact is regulatory driven and non-recurring nature, the company has presented such incremental impact of ? 2.69 crore as ‘Exceptional item’ for the year ended 31 March 2026. The company continues to monitor the finalization 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 development as and when needed.

52. The Ministry of Corporate Affairs (MCA) has prescribed a new requirement for companies under the proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 inserted by the Companies (Accounts) Amendment Rules 2021 requiring companies, which uses accounting software for maintaining its books of account, shall use only such accounting software which has a feature of recording audit trail of each and every transaction, creating an edit log of each change made in the books of account along with the date when such changes were made and ensuring that the audit trail cannot be disabled.

The Company uses an accounting software for maintaining its books of account which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the accounting software. However, the audit trail feature is not enabled at database level for accounting software to log any direct data changes for users with certain privileged access rights. Further there is no instance of audit trail feature being tampered with in respect of the accounting software where such feature is enabled. Additionally, the audit trail has been preserved at the application level by the Company as per the statutory requirements for record retention.

Presently, the log is enabled at the application level and the privileged access to accounting software database continues to be restricted to limited set of users who necessarily require this access for maintenance and administration of the database.

This is the summary of material accounting policy information and other explanatory information referred to in our report of even date