15.5 Rights, Preferences and Restrictions attached to Equity Shares
The Company has one class of Equity Shares having a face value of Rs.10/- per share. Each shareholder is eligible for one vote per share held. The Dividend proposed by the Board of Directors is subject to the approval of the Shareholders in the Annual General Meeting, except in case of Interim Dividend. In the event of liquidation, the Equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.
15.6 Equity Shares allotted as fully paid pursuant to contract without payment being received in cash during the period of five years immediately preceding 31st March 2026
Pursuant to the Scheme of Arragement (Refer Note 33), the Company has allotted 1,83,78,382 new Equity Shares of Rs 10/- each fully paid up on 10th June 2025 to the shareholders of Khadim India Limited (as on the Record Date i.e.,7th June 2025).
21.1 Nature of Security of Cash Credit Loans from Banks
Primary security - Exclusive charge by way of hypothecation on entire current assets of the Company, both present and future, including stock, book debts and other current assets
Collateral security - Equitable mortgage of leased property at Panpur (owned by Siddhartha Roy Burman and Khadim Estate Advisors Pvt Ltd) personal guarantee of Managing Director and Siddhartha Roy Burman and corporate guarantee of Holding company and another group company.
33 Scheme of Arrangement
The Board of Directors of the Company, at its meeting dated 29th September 2023, had approved a Scheme of Arrangement between Khadim India Limited (KIL) and KSR Footwear Limited (KFL) and their respective shareholders and creditors under sections 230 to 232, 66 and other relevant provisions of the Companies Act, 2013. The Hon'ble National Company Law Tribunal, Kolkata Bench (NCLT), vide Order dated 27 March, 2025, had sanctioned the Scheme of Arrangement. Pursuant to the Scheme, KIL has demerged its distribution business, as a going concern, into KFL effective from 1st May 2025, with appointed date being 1st April 2025 as per the Scheme. Upon the scheme being effective, KIL has transferred the assets and liabilities pertaining to its Distribution business into the Company as on the appointed date. The Company has accordingly recognized in its books of accounts the carrying value of such assets and liabilities. In accrodance with the Scheme, the excess of the carrying value of assets transferred (after adjustment of value of shares issued to the shareholders of KIL) over the carrying value of liabilities transferred aggregating Rs.698.36 millions has been recognized in the books as Capital Reserve. Pursuant to the Scheme, the Company has allotted 1,83,78,382 new Equity Shares of Rs 10/- each fully paid up on 10th June 2025 to the shareholders of KIL (as on the Record Date i.e.,7th June 2025). Pursuant to the Scheme, the Company has cancelled its share capital of Rs.0.10 millions held by KIL and therefore it has ceased to be the wholly owned subsidiary of KIL w.e.f. 1st April 2025. The shares of the Company were listed for trading on the NSE and BSE on 27th November 2025.
In accordance with the accounting treatment specified in the Scheme, the figures for the comparative periods have been restated as if the Scheme had been effective from the start of the preceding year. Accordingly, the figures for the preceding periods include the results of the Company and the Demerged Undertaking transferred under the Scheme. Earnings per share has accordingly been calculated after giving effect to the demerger adjustments with effect from the start of the preceding year.
35 The Company has identified one business segment namely "Footwear and accessories” which is consistent with internal reporting provided to the Managing Director who is the Chief Operating Decision Maker (CODM) in accordance with Ind AS 108 " Operating Segments”.
38 Employee Benefits
The Company has recognized, in the Statement of Profit and Loss for the year ended 31st March 2026 an amount of Rs.4.44 millions (Previous Year - Rs.4.31 millions) as expenses under defined contribution plans (Employer's Contribution to Provident and Other Funds) under Note 31.
38.1 Defined Benefit Plan
Description of Plans
The employees' gratuity fund scheme is managed by Life Insurance Corporation Of India (LICI) as a defined benefit plan. The present value of obligation is determined by actuarial valuation using the Projected Unit Credit Method , which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation.
Risk Management
The Defined Benefit Plans expose the Company to risk of actuarial deficit arising out of investment risk, interest rate risk and salary cost inflation risk.
Investment Risks: This may arise from volatility in asset values due to market fluctuations and impairment of assets due to credit losses. These Plans primarily invest in debt instruments such as Government securities and highly rated corporate bonds - the valuation of which is inversely proportional to the interest rate movements.
Interest Rate Risk: The present value of Defined Benefit Plans liability is determined using the discount rate based on the market yields prevailing at the end of reporting period on Government Bonds. Decrease in yields will increase the fund liabilities and vice-versa.
Salary Cost Inflation Risk: The present value of the Defined Benefit Plan liability is calculated with reference to the future salaries of participants under the Plan. Increase in salary due to adverse inflationary pressures might lead to higher liabilities.
Longevity Risk: The present value of the Defined Benefit Plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan's liability.
X. Sensitivity Analysis
The sensitivity analysis below has been determined based on reasonably possible change of the respective assumptions occurring at the end of the reporting period, while holding all other assumptions constant. These sensitivities show the hypothetical impact of a change in each of the listed assumptions in isolation. While each of these sensitivities holds all other assumptions constant, in practice such assumptions rarely change in isolation and the asset value changes may offset the impact to some extent. For presenting the sensitivities, the present value of the Defined Benefit Obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same as that applied in calculating the Defined Benefit Obligation presented above. There was no change in the methods and assumptions used in the preparation of the Sensitivity Analysis from previous year.
40 Financial Instruments and related disclosures A Capital Management
The Company aims at maintaining a strong capital base safeguarding business continuity and augments its internal generations with a judicious use of borrowing facilities to meet the requirements of working capital that arise from time to time as well as requirements to finance business growth. The Company is not subject to any externally imposed capital requirements.
C Financial risk management objectives
The Company's activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk. The Company's financial risk management process seeks to enable the early identification, evaluation and effective management of key risks facing the business. Backed by strong internal control systems, the current risk management framework rests on policies and procedures issued by appropriate authorities; process of regular reviews to set appropriate risk limits and controls; monitoring of such risks and compliance confirmation for the same.
Interest rate risk
As majority of the financial assets and liabilities of the Company are either non-interest bearing or fixed interest bearing instruments, the Company's net exposure to interest risk is negligible.
Price risk
The Company invests its short term funds primarily in debt mutual fund. Accordingly, these do not pose any significant price risk.
Liquidity Risk
Liquidity risk refers to the risk that the Company cannot meet its financial obligations. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows and by matching the maturity profiles of financial assets and liabilities. The Company consistently generated strong cash flows from operations by ensuring timely collections of its trade receivables and this together with the available cash and cash equivalents provides adequate liquidity in short terms as well in the long term.
Credit Risk
The Company's customer base is diverse limiting the risk arising out of credit concentration. Further, credit is extended in business interest in accordance with guidelines issued centrally and business-specific credit policies. All overdue customer balances are evaluated taking into account the age of the dues, specific credit circumstances, the track record of the counterparty etc. Loss allowances and impairment are recognized, where considered appropriate by responsible management.The Company has adopted a simplified approach by computing the expected credit loss allowance for trade receivables based on a provision matrix taking into account historical credit loss experience.
Of the trade receivables balance at the end of the year, no dues from any one customer exceeded 20 per cent of gross financial assets. The Company does not have significant credit risk exposure to any single counterparty or any group of counterparties having similar characteristics.
Foreign currency Risk
The Company undertakes transactions denominated in foreign currency (mainly US Dollar, Euro and Pound Sterling) which are subject to the risk of exchange rate fluctuations. Financial assets and liabilities denominated in foreign currency are also subject to reinstatement risks.
41 Fair value measurement Fair value hierarchy
Fair value of the financial instruments is classified in various hierarchies based on the following three levels: Level 1: Quoted prices (unadjusted) in active market for identical assets or liabilities
Level 2: Inputs other than quoted price included within level 1 that are observable for the asset or liability, either directly (i.e.as prices) or indirectly (i.e. derived from prices)
The fair value of financial instruments that are not traded in an active market is determined using market approach and valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If significant inputs required to fair value an instrument are observable, the instrument is included in Level 2.
Level 3: Inputs for the assets and liabilities that are not based on observable market data (unobservable inputs).
If one or more of the significant inputs is not based on observable market data, the fair value is determined using generally accepted pricing models based on a discounted cash flow analysis, with the most significant inputs being the discount rate that reflects the credit risk of counterparty.
The fair value of trade receivables, current investments, trade payables, other current financial assets and liabilities and short-term borrowings are considered to be equal to the carrying amounts of these items due to their short-term nature and accordingly not included in the below table. Where such items are Noncurrent in nature, the same has been classified as Level 3 and fair value determined using discounted cash flow basis. Similarly, unquoted equity instruments where most recent information to measure fair value is insufficient, or if there is a wide range of possible fair value measurements, cost has been considered as the best estimate of fair value.
There has been no change in the valuation methodology for Level 3 inputs during the year. The Company has not classified any material financial instruments under Level 3 of the fair value hierarchy. There were no transfers between Level 1 and Level 2 during the year.
42 Other Statutory Information
i. Title deeds of Immovable Properties are in the name of the Company.
ii. The Company has not granted any loans or advances in the nature of loans to promoters, directors, KMPs and the related parties (as defined under Companies Act, 2013), either severally or jointly with any other person.
iii. In respect of borrowings from banks on the basis of security of current assets, there are no material discrepancies between the quarterly returns or statements of current assets filed by the Company with banks and the books of account.
iv. The Company was not holding any benami property and no proceedings were initiated or pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder.
v. The Company has not been declared a wilful defaulter by any bank or financial institution or other lender (as defined under the Companies Act, 2013) or consortium thereof,in accordance with the guidelines on wilful defaulters issued by the Reserve Bank of India
vi. The Company does not have any transactions with struck off companies under Section 248 of the Companies Act, 2013 or Section 560 the Companies Act, 1956.
vii. The Company did not have any charges or satisfaction which were yet to be registered with ROC beyond the statutory period.
viii. The Company has not traded or invested in Crypto Currency or Virtual Currency during the year ended 31st March, 2026.
ix. The Company has not advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) any funds to or in any other persons or entities, including foreign entities ("Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, 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 provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
x. The Company has not received any funds from any persons or entities, including foreign entities ("Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the Company shall, 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 provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
xi. The Company did not have any transaction which had not been recorded in the books of account that had been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).
xii. The Company has complied with the number of layers prescribed under clause (87) of Section 2 of the Act read with the Companies (Restriction on number of Layers) Rules, 2017.
43 On 21st November, 2025, the Government of India notified four Labour Codes - the Code on Wages, 2019, the Industrial Relations Code, 2020, the Code on Social Security, 2020, and the Occupational Safety, Health and Working Conditions Code, 2020 - consolidating 29 existing labour laws. The Ministry of Labour & Employment published draft Central Rules and FAQs to enable assessment of the financial impact due to changes in regulations. The Company has assessed and disclosed the incremental impact of these changes on the basis of best information available, consistent with the guidance provided by the Institute of Chartered Accountants of India. Considering the materiality and regulatory-driven, non-recurring nature of this impact, the Company has presented such incremental impact as "Impact of new Labour Codes” under "Exceptional items” in the Statement of Profit and Loss for the year ended 31st March, 2026. The incremental impact consisting of gratuity and leave encashment benefits of Rs.5.05 millions primarily arises due to change in wage definition. The Company continues to monitor the finalisation of Central/ State Rules and clarifications from the Government on other aspects of the Labour Code and would provide appropriate accounting effect on the basis of such developments as needed.
## Return on investments has been considered for interest received on fixed deposits. The ratio is impacted by movements in fixed deposit during the year, including investments, maturities, renewals and redemptions occurring at different dates. Accordingly, the ratio computed using average year-end investment balances is not directly comparable with the contractual interest rates earned on fixed deposits.
46 The financial statements were approved for issue by the Board of Directors on 22nd May 2026.
47 Previous year's figures have been regrouped/rearranged wherever necessary to make them comparable with those of current year.
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