Contingent Liabilities and Provisions for claims and
litigations

Legal proceedings 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 legal counsel and
certain other 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.

Employee Benefits (Estimation of defined benefit
obligation)

Post-employment benefits represents obligation that will
be settled in future and require assumptions to project
benefit obligations. Post-employment benefits accounting
is intended to reflect the recognition of future benefits 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,
funding requirements and benefit costs incurred.

All items of property, plant and equipment are stated either at historical cost i.e. cost of acquisition / construction or at
deemed cost as on the date of transition to Ind AS less accumulated depreciation, accumulated impairment loss, if any.
Capital work in progress is stated at cost, net of accumulated impairment loss, if any. Historical cost includes expenditure that
is directly attributable to the acquisition of the assets.

Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as appropriate, only when
it is probable that future economic benefits associated with the asset will flow to the Company and the cost of the asset can
be measured reliably. The carrying amount of the replaced component is derecognised when replaced. All other repairs and
maintenance are charged to the statement of profit and loss during the reporting period in which they are incurred.

Depreciation

In case of certain property, plant and equipment, depreciation is provided on a pro-rata basis on the straight line method over
the estimated useful lives of the assets which are different than the rates prescribed under the Schedule II to the Companies
Act, 2013.

The Company, based on technical assessment made by technical expert and management estimate, depreciates certain
items of Plant & Equipment and Electrical Installations over estimated useful life of 18 to 23 years 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 along with consideration
of the climate related matters.

Depreciation on historical cost/deemed cost of other property, plant and equipment (except land) is provided on pro rata
basis on straight line method based on useful lives specified in Schedule II to the Companies Act, 2013.

The useful lives, residual values and method of depreciation of property, plant and equipment are reviewed and adjusted, if
appropriate at the end of each reporting year.

An item of property, plant and equipment or its components recognised 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 cost of property, plant and equipment not ready to use are disclosed under capital work -in- progress.

(i) Gross Carrying amount and accumulated depreciation includes ' 60.25 Crores (31 March, 2025 - ' 57.20 Crores) and it
' 23.07 Crores (31 March, 2025 - ' 20.51 Crores),respectively in respect of Buildings on Leasehold Land.

(ii) The Company has borrowings from banks, which carry security charge over certain of the above property, plant and
machinery (Refer note 10(a) for details).

(iii) Gross carrying amount on leasehold land is against certain lease agreements where the Company has an option to
renew the properties on expiry of the lease period. The Company based on terms and conditions of lease agreements
has assessed these lease arrangements to be perpetual in nature, accordingly leasehold land is not amortised.

(iv) Aggregate amount of depreciation has been included under depreciation and amortisation expense in the Statement
of Profit and Loss (Refer note 19).

(v) Refer note 24 for disclosure of contractual commitments for purchase of Property,Plant and Equipment.

(vi) Title deed of the above immovable properties are held in the name of the Company.

(vii) There are no restrictions over the title of the Company's Property,Plant and Equipment.

(viii) The Company has not revalued its Property,Plant and Equipment during the year ended 31 March, 2026 and 31 March,
2025.

(ix) The Company has physical verification programme for Property, Plant and Equipment of once in three years. Based on
such verification, no material discrepancies were noticed.

NOTE 3(c) : INVESTMENT PROPERTY
Accounting Policy

Property that is held for long-term rental yields or for capital appreciation or both, and that is not occupied by the Company,
is classified as investment property. Investment property is measured initially at its cost, including related transaction costs.
Subsequent to initial recognition, investment properties are stated at cost less accumulated depreciation and accumulated
impairment loss, if any. Subsequent expenditure is capitalised to the asset's carrying amount only when it is probable that
future economic benefits associated with the expenditure will flow to the Company and the cost of the item can be measured
reliably.

Investment properties are derecognised either when they have been disposed off or when they are permanently withdrawn
from use and no future economic benefit is expected from their disposal. The difference between the net disposal proceeds
and the carrying amount of the asset is recognised in the statement of profit or loss in the period of derecognition.

NOTE 3(d) : INTANGIBLE ASSETS j>

Accounting Policy

Intangible assets have a finite useful life and are stated at cost less accumulated amortisation,accumulated impairment loss,
if any.

Computer Software for internal use, which is primarily acquired from third party vendors, is capitalised. Subsequent costs
associated with maintaining such software are recognised as expense as incurred. Cost of software includes license fees and
cost of implementation/system integration services, where applicable.

Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal
proceeds and the carrying amount of the asset and are recognised in the statement of profit or loss when the asset is
derecognised.

Amortisation method and period

Computer software is amortised on a straight line basis over estimated useful life of three years from the date of capitalisation.
Amortisation method and useful lives are reviewed periodically at each financial year end.

* No movement in Investment property during the year ended 31 March, 2026 and 31 March, 2025.

There is no income and expenditure arising from the above investment property during the year 31 March, 2026 and
31 March, 2025.

Estimation of fair value

The Company's investment property consists of freehold land in Angul, Odisha, India.

The fair value of the investment property is based on current prices for similar property. The main inputs used are quantum,
area, location, demand, and trend of fair market value in the area.

The fair value is based on independent valuation done by registered valuer [as defined under rule 2 of Companies (Registered
Valuers and Valuation) Rules, 2017]. Fair valuation is based on market approach method and categorised as Level 2 fair value
hierarchy. The fair value of the property is ' 9.25 Crores and ' 9.00 Crores as at 31 March, 2026 and 31 March, 2025 respectively.

The Company has no restrictions on the realisability of its investment property and no contractual obligations to purchase,
construct or develop investment property or for repairs, maintenance and enhancements.

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 accumulated 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. 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.

1. Aggregate amount of depreciation has been included under depreciation and amortisation expense in the Statement
of Profit and Loss (Refer Note 19).

2. The Company has not revalued its Right of use assets during the year ended 31 March, 2026 and 31 March, 2025.

3. Lease deeds of immovable properties mentioned are in the name of the Company.

4. Average lease period of Buildings is 3-10 years, Plant and Equipment is 3-16 years and Vehicles is 4-6 years.

There is no project whose completion is overdue or has exceeded its cost compared to its original plan during the year ended
31 March, 2026 and 31 March, 2025.

NOTE 4(a): INVESTMENTS
Accounting Policy

1. Investment in subsidiaries

I nvestments in shares and debentures of subsidiaries are stated at cost less provision for impairment losses, if any.
Investments are tested for impairment whenever an event or changes in circumstances indicate that the carrying
amount may not be recoverable. An impairment loss is recognised for the amount by which the carrying amount of
investments exceeds its recoverable amount. If, in a subsequent period, recoverable amount equals or exceeds the
carrying amount, the impairment loss recognised is reversed accordingly.

1.1 Investment (other than investment in shares and debentures of subsidiaries)

1.1.1. Classification

The Company classifies its investments as those to be measured subsequently at fair value (either through other
comprehensive income or through profit and loss).

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

For investments measured at fair value, gains and losses are either recorded in the statement of profit and loss or
other comprehensive income. For investments in debt instruments, this depends on the business model in which
the investment is held. For investments in equity instruments, this depends on whether the Company has made

an irrevocable election at the time of initial recognition to account for the equity investment at fair value through
other comprehensive income (FVTOCI). The Company reclassifies the debt investments when and only when the
business model for managing those investment changes.

1.1.2. Measurement

At initial recognition, the Company measures an investment at its fair value plus, in the case of investment not at fair
value through profit and loss, transaction costs that are directly attributable to the acquisition of the investment.
Transaction costs of investments carried at fair value through profit and loss are expensed in the statement of profit
and loss.

(a) Debt Instrument

Subsequent measurement of debt instruments depends on the Company's business model for managing the
investment and the cash flow characteristics of the investment. The Company classifies its debt instruments
as:

Fair Value Through Profit and Loss (FVTPL): Investments that do not meet the criteria for amortised cost
or FVTOCI are measured at fair value through profit and loss. A gain or loss on a debt investment that is
subsequently measured at fair value through profit and loss is recognised in statement of profit and loss and
presented on net basis in the statement of profit and loss within other income/other expense in the year in
which it arises.

(b) Equity Instrument

The Company subsequently measures all equity investments at fair value through Other Comprehensive
Income and there is no subsequent reclassification of fair value gains and losses to the statement of profit and
loss. At the time of derecognition of such investments, the gain or loss is transferred to retained earnings.

2 Refer note 28 for information about fair value measurements and note 29 for credit risk and market risk on investments.

3 *During the previous year,the Board of Directors of Advaya Chemical Industries Limited (“ACIL" or “Transferee Company”),
a subsidiary of the Company, and the Board of Directors of Aquapharm Chemicals Private Limited (“ACPL" or “Transferor
Company”), a wholly owned subsidiary of ACIL, at their respective meetings held on 01 August, 2024 approved the
Scheme of Amalgamation of ACPL with ACIL under Section 233 and other applicable provisions of the Companies Act,
2013 (“Scheme"). The Scheme provides for amalgamation of ACPL with ACIL and other matters incidental thereto.

The Central Government through the Regional Director, Western Region, Ministry of Corporate Affairs (“Regional
Director”) vide order dated 06 December, 2024 has approved the Scheme. Consequently, ACPL stands amalgamated
with ACIL and ACPL ceases to exist as a separate entity. Post amalgamation, the name of the Transferee Company has
changed from 'Advaya Chemical Industries Limited' to 'Aquapharm Chemical Limited'.

The Company has borrowings, which carry security/charge over the aforesaid Investments (Refer Note 10(a)).

4 During the previous year, the Board of Directors of the Company, at its board meetings granted authorisation to execute
the Joint Venture Agreement dated 16 March, 2024 between the Company and Kinaltek Pty Ltd (“Kinaltek”) as novated
and amended vide joint venture novation and amendment agreement between the Company, Kinaltek and Kindia Pty
Ltd (as a trustee of Kindia Unit Trust) (“Kindia”) dated 17 September, 2024 (“Joint Venture Agreement”). The Company
incorporated a wholly owned subsidiary Nanovace Technologies Limited (“JV Company”), on 29 March, 2024.

The Company has invested ' 2.55 Crores as equity contribution which represents 51% of the shareholding in the JV
Company and Kindia has invested ' 2.45 Crores as equity contribution which represents 49% of the shareholding in the
JV Company. Further, the Company has invested ' 194.80 Crores and ' 33.52 Crores during the year ended 31 March,
2025 and 31 March, 2026, respectively, by way of subscription to optionally convertible debenture (OCDs) and Kindia has
invested ' 1.66 Crores by way of subscription to compulsorily convertible debentures (CCDs).

5 **The Company,during the year, has converted loan amounting to Euro 3,65,220 (equivalent ' 2.52 Crores) into 1,486
equity shares of Euro 1 each.

6 ***During the year ended 31 March, 2026, the Board of Directors of Devise Properties Private Limited at its meeting held
on 31 May, 2025 considered and approved the conversion of 10,50,000, 0% Fully Convertible Preference Shares - Series
A of ' 100/- each held by PCBL Chemical Limited into 50,84,746 fully paid-up equity shares of ' 10/- each based on the
conversion price determined pursuant to the valuation of the equity shares as per the Fair Valuation Report dated 31
May, 2025. The Company sold Investment in equity share of Devise Properties Private Limited to one of its related party
(Refer note 27).

@ These investments in equity instruments are not held for trading. Upon application of Ind AS 109, the Company
has chosen to designate these investments in equity instruments at FVTOCI as the management believes that this
provides a more meaningful presentation for long term investments than reflecting changes in fair values immediately
in statement of profit and loss. Based on the aforesaid election, fair value changes are accumulated within Equity under
"Fair Value Changes through Other Comprehensive Income - Equity Instruments". The Company transfers amounts
from this reserve to retained earnings when relevant equity shares are derecognised. The fair value of such unquoted
investments has been carried out by applying applicable valuation methodologies, which has been performed by
independent valuation experts.

a The cost of unquoted investments in equity instruments (fully paid up) have been written off, though quantity thereof
appears in the books.

Trade receivables are amounts receivable from customers for goods sold in the ordinary course of business and net of amount
received pursuant to transfer of substantially all risk and reward of ownership. Trade receivable are initially recognised at
transaction price and subsequently measured at amortised cost using the effective interest method, less provision for
impairment.

For trade receivables, 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.

1. No trade or other receivable are due from directors or other officers of the Company either severally or jointly with
any other person. Nor any trade or other receivable are due from firms or private companies respectively in which any
director is a partner, a director or a member.

2. Trade receivables are non-interest bearing and are generally on terms of 0 to 90 days.

3. The carrying amount of trade receivables may be affected by the changes in the credit risk of the counterparties as well
as the currency risk as explained in note 29.

4. For lien/charge against trade receivables, Refer note 10 (a).

5. There are no disputed trade receivables as at 31 March, 2026 and 31 March, 2025.

6. There are no unbilled receivables as at 31 March, 2026 and 31 March, 2025.

‘Balances with Government Authorities primarily includes amounts realisable, if any, from the GST Authorities and customs
authorities of India and the unutilised GST input credits on purchases to be utilised against future GST liabilities. These are
generally realised within one year and hence these balances have been classified as current assets.

#Export Benefit Receivables primarily consist of amounts receivable from government authorities of India towards incentives
on export sales made by the Company.

NOTE 6 : INVENTORIES

(At lower of cost and net realisable value)

Accounting Policy

Inventories are valued at lower of cost and net realisable value.

• Raw materials, Stores and Spares and Packing Material: cost is determined on moving average method and includes
cost of purchase and other incidental costs. 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.

• Finished goods: cost includes cost of direct materials,labour and a proportion of manufacturing overheads based on the
normal operating capacity.

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

(i) The Preferential Issue Committee of the Board of Directors of the Company at its Meeting held on 07 May, 2024, had
approved the allotment of warrants of the Company, on a preferential basis by way of a private placement and allotted
1,36,00,000 convertible warrants to Rainbow Investments Limited (Promoter) and 12,00,000 convertible warrants each
to Quest Capital Markets Limited (Promoter Group) and STEL Holdings Limited (Promoter Group) on 07 May, 2024 for
an issue price of ' 280 per warrant. Out of total issue price, ' 70 per warrant (25% of the issue price) amounting to ' 112
Crores was received during the year ended 31 March, 2025, as the initial subscription amount at the time of allotment of
the warrants.

During the year ended 31 March, 2026, the Company has received ' 336 Crores (remaining 75% of the issue price). Upon
receipt of such amount, the Preferential Issue Committee of the Board of Directors of the Company at its Meeting held
on 03 November, 2025 has considered and approved the allotment of 1,60,00,000 Equity Shares of face value of Re. 1/-
each, upon conversion of equal number of Warrants. The amount raised, has been used fully for the purposes for which
the funds were raised.

This has been considered for calculating diluted earnings per equity share as per Ind AS 33-Earnings Per Share upto
03 November, 2025.

The Company has complied with provisions of Section 42 and Section 62 of the Companies Act, 2013 in respect of issue
of equity shares in conversion of share warrants.

(ii) No equity shares were allotted as fully paid up by way of bonus shares or pursuant to contract(s) without payment being
received in cash during the last five years. Further, none of the shares were bought back by the Company during the last
five years.

Note 10 (a) : BORROWINGS
Accounting Policy

Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured
at amortised cost using the effective interest rate (EIR) method. Any difference between the proceeds (net of transaction
costs) and the redemption amount is recognised in the statement of profit and loss over the period of the borrowings using
the effective interest rate method. Fees paid on the establishment of loan facilities are recognised as transaction costs of the
borrowings to the extent that it is probable that some or all of the facility will be utilised. In this case, the fee is deferred until
the draw down occurs. Borrowings are derecognised from the balance sheet when the obligation specified in the contract is
discharged, cancelled or expired.

Term loan from banks amounting to:

(a) ' 950.60 Crores (31 March, 2025 - ' 983.11 Crores) are secured with a first charge by way of a hypothecation over all
movable fixed assets of the Company both present and future,ranking pari passu with charge created in favour of other
term lenders.

(b) ' 218.56 Crores (31 March, 2025 - ' 245.07 Crores) are secured with a second charge by way of a hypothecation over
movable fixed assets of the Company.

Term loan from NBFC amounting to:

' Nil (31 March, 2025 - ' 645.23 Crores) is secured with first ranking exclusive charge by way of pledge over the pledged assets
i.e. shares of subsidiary, Aquapharm Chemical Limited ("ACL") (formerly Advaya Chemical Industries Limited) with 1.5x cover.

Non-Convertible Debentures amounting to:

' 487.22 Crores (31 March, 2025 - ' 590.60 Crores) is secured with first ranking exclusive charge by way of pledge over the
pledged assets i.e. shares of subsidiary, Aquapharm Chemical Limited ("ACL") (formerly Advaya Chemical Industries Limited)
with 1.5x cover.

Refer notes 3(a), 4(a), 4(b) and 6 for details of assets pledged as security as set out in the above note. Refer note 29 for
information about liquidity risk and market risk on borrowings.

Term loans were applied for the purpose for which the loans were obtained.

The quarterly returns/statements filed by the Company with such banks are in agreement with the unaudited books of
accounts of the Company. Further, the Company do not have sanctioned working capital limits in excess of ' five crores
in aggregate from financial institutions, other than Banks, during the year on the basis of security of current assets of the
Company.

The Company has not defaulted in scheduled repayment of loans or other borrowings or in payment of interest thereon to
any lenders.

Trade payables represent liabilities for goods and services provided to the Company prior to the end of financial year which
are unpaid. Trade and other payables are presented as current liabilities unless payment is not due within 12 months after
the reporting period. They are recognised initially at their fair value and subsequently measured at amortised cost using the
effective interest rate method.

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)
and does not include non-lease components (maintenance charges etc.). 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. Lease liabilities are remeasured with a corresponding
adjustment to the related right of use asset if the Company changes its assessment if whether it will exercise an extension
or a termination option.

Note 10 (d) : OTHER FINANCIAL LIABILITIESAccounting PolicyShort Term Employee Benefits

Liabilities for short term employee benefits that are expected to be settled wholly within 12 months after the end of the
period are measured at the amounts expected to be paid when the liabilities are settled. The liabilities are presented as
current employee benefits payable in the balance sheet.

NOTE 11 : PROVISIONS
Accounting Policy
Provisions

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

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

11.1 Provisions for claims and litigations

Provision for claims & litigation includes civil proceeding against one of the party and regulatory proceeding pertaining
to FEMA matter. The Company has estimated the provisions for pending claims and litigation based on the assessment
of probability for these demands crystallising against the Company in due course. The table below gives information
about movement in claims and litigations, and provisions.

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.

Revenue towards satisfaction of a performance obligation is measured at the amount of transaction price allocated to that
performance obligation. Amounts disclosed as revenue are net of returns, trade and other discounts, rebates and amounts
collected on behalf of third parties.

Where the Company is the principal in the transaction, the sales are recorded at their gross values. The Company considers
whether there are other promises in the contract that are separate performance obligations to which a portion of the
transaction price needs to be allocated. In determining the transaction price, the Company considers the effects of variable
consideration, the existence of significant financing component, non-cash considerations and consideration payable to
the customer (if any). Any amounts received for which the Company does not provide any distinct goods or services are
considered as a reduction of purchase cost.

However, Goods and Service Tax (GST) is not received by the Company on its own account. Rather, it is collected on value
added to the commodity by the seller on behalf of the Government. Accordingly, it is excluded from revenue.

The Company recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic
benefits will flow to the Company regardless of when the payment is being made and specific criteria have been met for each
of the Company's activities as described below.

Sale of carbon black

Revenue from sale of carbon black is recognised when the control of the goods has passed to the buyer as per the terms of
contract. In case of domestic sales, the performance obligation is satisfied upon delivery of the finished goods at customer's
location. In case of export sales, the performance obligation is satisfied once the goods are shipped and the bill of lading has
been obtained.

Sale of power

Revenue from the sale of power is recognised upon transmission of units to the buyer net of Unscheduled Interchange gains/
losses as per the terms of contract with the customer.

Other Operating revenues

Exports entitlements (arising out of duty draw back, Remission of Duties and Taxes on Export Products (RoDTEP)) are
recognised when the right to receive credit as per the terms of the schemes is established in respect of the exports made by
the Company and when there is no significant uncertainty regarding the ultimate collection of the relevant export proceeds.

NOTE 17 : EMPLOYEE BENEFITS EXPENSE

Accounting Policy

(I) Post-employment benefits

Defined benefit plans

a. The liability or asset recognised in the balance sheet in respect of Defined benefit plans is the present value of the
Defined benefits obligation at the end of the reporting period less the fair value of plan assets. The Defined benefit
obligation is calculated annually by actuaries using the Projected Unit Credit Method at the year end.

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

c. The net interest cost is calculated by applying the discount rate to the net balance of the Defined benefit obligation
and the fair value of plan assets. This cost is included in Employees Benefits Expense in the statement of profit and
loss.

d. Re-measurement gains and losses arising from experience adjustments and changes in actuarial assumptions
are recognised in the period in which they occur, directly in Other Comprehensive Income. They are included in
retained earnings in the statement of changes in equity.

e. Changes in the present value of the Defined benefit obligation resulting from plan amendments or curtailments
are recognised immediately in the statement of profit or loss as past service cost.

(II) Defined contribution plans

Contributions under Defined Contribution Plans payable in keeping with the related schemes are recognised as
expenses for the period in which the employee has rendered the service.

(III) Other short-term employee benefit obligations

Liabilities for short term employee benefits that are expected to be settled wholly within 12 months after the end of the
period are measured at the amounts expected to be paid when the liabilities are settled. The liabilities are presented as
current employee benefits payable in the balance sheet.

The Company provides for the encashment of leave or leave with pay subject to certain rules. The employees are entitled
to accumulate leave subject to certain limits, for future encashment. The liability is provided based on the number of
days of unutilised leave at each balance sheet date on the basis of year-end actuarial valuation using projected unit
credit method. The scheme is unfunded.

17.1 EMPLOYEE BENEFITS:

(I) Post employment obligations

(A) Gratuity

The Gratuity scheme is a defined benefit plan that provides for a lump sum payment on exit either by way of retirement,
death, disability or voluntary withdrawal. The benefits are defined on the basis of last drawn salary and the period of
service and paid as lump sum at exit in accordance with the provisions under the Code on Social Security, 2020 or as
per the Company Scheme,as applicable. The liability in respect thereof is determined by actuarial valuation at the year
end based on the Projected Unit Credit Method and is recognised as a charge on accrual basis. Trustees administer
the contributions made to the Gratuity fund. Amounts contributed to the Gratuity fund are invested solely with the Life
Insurance Corporation of India.

The following table sets forth the particulars in respect of the defined benefit plans of the Company for the year ended
31 March, 2026 and 31 March, 2025:

(vii) Risk Exposure

Through its defined benefit plans, the Company is exposed to some risks, the most significant of which are detailed
below:

1 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.

2 Salary Inflation risk: Higher than expected increases in salary will increase the defined benefit obligation.

3 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.

4 Investment risk: The probability or likelihood of occurrence of losses relative to the expected return on any particular
investment.

(II) Defined Contribution Plans

The Company has certain Defined Contribution Plans viz. Provident Fund and Superannuation Fund. Contributions are
made to provident fund for employees at the rate of 12% of basic salary as per regulations. The Company has a defined
contribution Superannuation plan for which contribution is made at a rate not exceeding 4.87% of Basic and Dearness
Allowance of the member with Superannuation. The contributions are made to registered provident fund administered
by the government. The obligation of the Company is limited to the amount contributed and it has no further contractual
nor any constructive obligation. The expense recognised during the period towards defined contribution plan is ' 13.16
Crores (31 March, 2025 - ' 12.28 Crores).

(III) Defined Benefit Liability and Employer Contributions

Expected contribution to Post-employment benefit plans for the year ending 31 March, 2026 basis the acturial report is
' 4.98 Crores (31 March, 2025: ' 3.36 Crores).

The weighted average duration of the defined benefit obligation is 7 years (31 March, 2025 - 6 years) for employees and
12 years (31 March, 2025 - 12 years) for contractual employees. The expected maturity analysis of undiscounted gratuity is
as follows:

General and specific borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying
asset are capitalised during the period of time that is required to complete and prepare the asset for its intended use or sale.
Qualifying assets are assets that necessarily take a substantial period of time to get ready for their intended use or sale.
Other borrowing costs are expensed in the period in which they are incurred.

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 adjusted by changes in deferred tax assets and liabilities attributable to temporary differences
and to unused tax losses.

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of
the reporting period. Management periodically evaluates positions taken in tax returns with respect of situation 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.

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the standalone financial statements. Deferred income tax is not accounted
for if it arises from initial recognition of an asset or liability in a transaction that at the time of the transaction affects neither
accounting profit/loss nor taxable profit (tax loss). Deferred income tax is determined using tax rates (and laws) that have
been enacted or substantially enacted by the end of the reporting period.

Current and deferred tax is recognised in statement of profit and loss, except to the extent that it relates to items recognised
in other comprehensive income or directly in equity, if any. In this case, the tax is also recognised in other comprehensive
income or directly in equity, respectively.

Deferred tax assets are recognised for all deductible temporary differences and unused tax losses only if it is probable that
future taxable amounts will be available to utilise those temporary differences and losses.

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.

NOTE 26 : EARNING PER EQUITY SHARE
Accounting Policy
Basic earnings per share

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

The weighted average number of equity shares outstanding during the year is adjusted for events such as bonus issue, bonus
element in a rights issue, share warrants, share split, and reverse share split (consolidation of shares) that have changed the
number of equity shares outstanding, without a corresponding change in resources.

Diluted earnings per share

Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account:

• the after income tax effect of interest and other financing costs associated with dilutive potential equity shares, and

• the weighted average number of additional equity shares that would have been outstanding assuming the conversion
of all dilutive potential equity shares.

The fair values of financial assets and liabilities are included at the amount that would be received to sell an asset or
paid to transfer a liability in an orderly transaction between market participants at the measurement date. Methods and
assumptions used to estimate the fair values are consistent in all the years. The following methods and assumptions
were used to estimate the fair values:

(a) I n respect of investments in mutual funds, the fair values represent net asset value as stated by the issuers of
these mutual fund units in the published statements. Net asset values represent the price at which the issuer will
issue further units in the mutual fund and the price at which issuers will redeem such units from the investors.
Accordingly, such net asset values are analogous to fair market value with respect to these investments, as
transactions of these mutual funds are carried out at such prices between investors and the issuers of these units
of mutual funds.

(b) In respect of investments in listed equity instruments, the fair values represents available quoted market price at
the Balance Sheet date.

(c) The fair value of derivative contracts (foreign exchange forward contracts and Currency and Interest rate swaps) is
determined using discounted cash flow analysis and swaps and options pricing models.

(d) The management assessed that fair values, of trade receivables, cash and cash equivalents, other bank balances,other
financial assets, loans, trade payables, borrowings, lease liabilities and other financial liabilities, approximate to
their carrying amounts largely due to the short-term maturities of these instruments. Further, management also
assessed the carrying amount of certain non-current loans which are a reasonable approximation of their fair
values and the difference between the carrying amounts and fair values is not expected to be significant.

(iii) Fair value of financial assets and liabilities measured at amortised cost

The carrying amount of financial assets and financial liabilities measured at amortised cost in the financial statements
are a reasonable approximation of their fair values since the Company does not anticipate that the carrying amount
would be significantly different from the values that would eventually be received or settled.

(iv) Fair value hierarchy

This section explains the judgements and estimates made in determining the fair values of the financial instruments
that are (a) recognised and measures at fair value and (b) measured at amortised cost and for which fair values are
disclosed in the financial statements. To provide an indication about the reliability of the inputs used in determining
fair value, the Company has classified its financial instruments into the three levels prescribed under the accounting
standard. Explanation of each level follows underneath the table:

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments.
The fair value of all equity instruments which are traded in the stock exchanges is valued using the closing price as at the
reporting period.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques
which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant
inputs required to fair value an instrument are observable, the instrument is included in Level 2.

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in Level 3.
This is the case for unlisted equity securities included in Level 3.

The Company's policy is to recognise transfers into and transfers out of fair value hierarchy levels as at the end of the reporting
period. There are no transfers between Level 1 and Level 2 fair value measurements during the year ended 31 March, 2026 and
31 March, 2025.

Some of the Company's financial assets are carried at fair value for which Level 3 inputs have been used. The following table
gives information about how the fair values of these financial assets are determined (in particular, the valuation technique(s)
and inputs used).

Valuation process:

The main Level 3 inputs for unquoted equity shares and unquoted preference share used by the Company are derived and
evaluated as follows:

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

NOTE 29 : FINANCIAL RISK MANAGEMENT

The Company's principal financial liabilities comprises of borrowings, trade, lease liabilities and other financial liabilities. The
main purpose of these financial liabilities is to finance and support the operations of the Company. The Company's principal
financial assets include trade and other receivables, loans, current investments and cash & cash equivalents that derive
directly from its operations.

The Company's business activities are exposed to a variety of risks including liquidity risk, credit risk and market risk. The
Company seeks to minimise potential adverse effects of these risks by managing them through a structured process of
identification, assessment and prioritisation of risks followed by coordinated efforts to monitor, minimise and mitigate the
impact of such risks on its financial performance and capital. For this purpose, the Company has laid comprehensive risk
assessment and minimisation/mitigation procedures, which are reviewed by the Audit Committee and approved by the
Board from time to time. These procedures are reviewed to ensure that executive management controls risks by way of
properly defined framework. The Company does not enter into derivative financial instruments for speculative purposes.

(A) Credit risk

Credit risk refers to risk of financial loss to the Company if customers or counterparties fail to meet their contractual
obligations. The Company is exposed to credit risk from its operating activities (mainly trade receivables) and from its
investing activities (primarily deposit with banks and investment in mutual funds).

(i) Credit risk management
(a) Trade Receivable

Customer credit risk is managed by the Company through its established policies and procedures which involve
setting up credit limits based on credit profiling of individual customers, credit approvals for enhancement of
limits and regular monitoring of important developments viz. payment history, change in credit rating, regulatory
changes, industry outlook etc. Outstanding receivables are regularly monitored and an impairment analysis is
performed at each reporting date on an individual basis for each major customer. In addition, small customers are
grouped into homogeneous groups and assessed for impairment collectively. The Company also has a policy to
provide for all receivables which are overdue for a period over 365 days. In accordance with Ind AS 109, the Company
uses expected credit loss model to assess the impairment loss or reversal thereof.

(C) Market Risk

Market risk is the risk that the fair value of future cash flow of financial instruments may fluctuate because of changes
in market conditions. Market risk broadly comprises three types of risks namely currency risk, interest rate risk and price
risk (for commodities or equity instruments). The above risks may affect the Company's income and expenses and/or
value of its investments. The Company's exposure to and management of these risks are explained below.

(i) Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes
in foreign exchange rates. The Company operates in international markets and therefore is exposed to foreign currency
risk arising from foreign currency transactions. The exposure relates primarily to the Company's operating activities
(when the revenue or expense is denominated in foreign currency), borrowings in foreign currencies and investment in
overseas subsidiaries. Over ninety percent of Company's foreign currency transactions are in USD while the rest are in
EURO, CNY, KRW, GBP and VND. The risk is measured through forecast of highly probable foreign currency cash flows.

The Company's risk management policy is hedging of net foreign currency exposure at all points in time through
foreign exchange forward contracts, vanilla option contracts and cross currency interest rate swaps. The objective of the
hedging is to eliminate the currency risk due to volatility in exchange rates.

(b) Deposits and financial assets (Other than trade receivables):

The Company maintains exposure in cash and cash equivalents, term deposits with banks and money market liquid
mutual fund schemes. Investments of surplus are made within assigned credit limits with approved counterparties
who meet the threshold requirements with respect to ratings, financial strength, credit spreads etc. Counterparty
credit limits are set to minimise concentration risk and are reviewed periodically by the Board.

(B) Liquidity Risk

Liquidity risk implies that the Company may not be able to meet its obligations associated with its financial liabilities.
The Company manages its liquidity risk on the basis of the business plan that ensures that the funds required for
financing the business operations and meeting financial liabilities are available in a timely manner and in the currency
required at optimal costs. The Management regularly monitors rolling forecasts of the Company's liquidity position to
ensure it has sufficient cash on an ongoing basis to meet operational fund requirements. The surplus cash generated,
over and above the operational fund requirement is invested in bank deposits/marketable debt securities/debt mutual
fund schemes of highly liquid nature to optimise cash returns while ensuring adequate liquidity for the Company.

Additionally, the Company has committed fund and non-fund based credit lines from banks which may be drawn
anytime based on Company's fund requirements. The Company maintains a cautious liquidity strategy with positive
cash balance and undrawn bank lines throughout the year.

The following are the remaining contractual maturities of financial liabilities at the reporting date. The amounts are
gross and undiscounted, and include contractual interest payments.

Securities price risk is the risk that the fair value of a financial instrument will fluctuate due to changes in market traded
prices.

The Company invests its surplus funds in various debt instruments and equity instruments. These comprise of mainly
liquid schemes of mutual funds, short term debt funds & income funds (duration investments),certain quoted equity
instruments and bank fixed deposits. To manage its price risk arising from investments in mutual funds and equity
instruments, the Company diversifies its portfolio. Mutual fund and equity investments are susceptible to market price
risk, mainly arising from changes in the interest rates or market yields which may impact the return and value of such
investments.

(a) Securities Price Risk Exposure

The Company's exposure to securities price risk arises from investments in mutual funds and equity instruments
held by the Company and classified in the Balance Sheet as fair value through profit or loss/fair value through other
comprehensive income is disclosed under Note 28.

(D) Commodity Price Risk

Commodity price risk results from changes in market prices for raw materials, mainly carbon black feedstock which
forms the largest portion of Company's cost of sales.

The Company endeavours to reduce such risks by maintaining inventory at optimum level through a highly probable
sales forecast on quarterly basis and also through worldwide purchasing activities. Raw materials are purchased
exclusively to cover Company's own requirements. Further, a significant portion of Company's volume is sold based
on formula-driven price adjustment mechanism which allows for recovery of the changed raw material cost from
customers. The Company also endeavours to offset the effects of increases in raw material costs through price increases
in its non-contract sales, productivity improvement and other cost reduction efforts. The Company has not entered into
any derivative contracts to hedge exposure to fluctuations in commodity prices.

NOTE 30 : CAPITAL MANAGEMENT

For the purposes of the Company's capital management, capital includes issued capital, all other equity reserves and
borrowed capital less reported cash and cash equivalents.

The primary objective of the Company's capital management is to maintain an efficient capital structure to reduce the cost
of capital, support the corporate strategy and to maximise shareholder's value.

The Company's policy is to borrow primarily through banks to maintain sufficient liquidity. The Company also maintains
certain undrawn committed credit facilities to provide additional liquidity. These borrowings, together with cash generated
from operations are utilised for operations of the Company.

The Company monitors capital on the basis of cost of capital. The Company is not subject to any externally imposed capital
requirements.

In order to achieve this overall objective, the Company's capital management, amongst other things, aims to ensure that it
meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements.
Breaches in meeting the financial covenants, if any would permit the bank to immediately call loans and borrowings. There
have been no breaches in the financial covenants/appropriate deferment of financial covenants has been obtained for
interest-bearing loans and borrowing for the year ended 31 March 2026.

No changes were made to the objectives, policies or processes for managing capital during the year ended 31 March, 2026
and 31 March, 2025.

NOTE 31 : OTHER STATUTORY INFORMATION

a) The Company does not have any transaction with struck off companies during the year ended 31 March, 2026.

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

c) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year ended 31
March,2026 and 31 March,2025.

d) The Company has 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 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.

e) The Company has 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 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 to or on behalf of the Ultimate Beneficiaries.

f) The Company has not surrendered or disclosed any transaction, previously unrecorded in the books of account, in the
tax assessments under the Income Tax Act, 1961 as income during the year.

g) There are no proceedings initiated or are pending against the Company for holding any benami property under the
Prohibition of Benami Property Transactions Act, 1988 and rules made thereunder.

h) The Company used 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 software. Further no instance of audit trail feature being tampered with was noted in respect of the accounting
software. Additionally, the audit trail of prior year has been preserved by the Company as per the statutory requirements
for record retention to the extent it was enabled and recorded in the respective years.

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

j) The Company is not a Core Investment Company as defined in the regulations made by Reserve Bank of India. The
Group has 4 Core Investment Companies as a part of the Group.

k) The Company has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with
Companies (Restriction in number of Layers) Rules, 2017

l) No fraud/material fraud by the Company or no fraud/material fraud on the Company has been noticed or reported and
no whistle blower complaints received, during the year ended 31 March, 2026 and 31 March, 2025.

NOTE 32 :

Subscriptions and donations in Note 20 includes contribution of ' 35 Crores (Previous year-' 35 Crores) which were made in
accordance with Section 182 of the Companies Act, 2013.

NOTE 33 :

In accordance with paragraph 4 of Ind AS 108 - “Operating Segment”, segment information has been given in the consolidated
financial statements, and therefore, no separate disclosure on segment information is given in these standalone financial
statements.

NOTE 34 : EXCEPTIONAL ITEMS

On 21 November, 2025, the Government of India notified provisions of 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, (‘Labour
Codes') which consolidate twenty- nine existing labour laws into a unified framework governing employee benefits during
employment and post employment. The Labour Codes, amongst other things introduces changes, including a uniform
definition of wages and enhanced benefits relating to leave. The Company has assessed the financial implications of these
changes which has resulted in increase in gratuity liability arising out of past service cost and increase in leave liability, in
aggregate ' 12.45 crores. Considering the impact arising out of an enactment of the new legislation is an event of non¬
recurring nature, the Company has presented this incremental amount as “Statutory impact of new Labour Codes” under
“Exceptional Items” in the Statement of Profit and Loss for the year ended March 31, 2026. The Company continues to monitor
the developments pertaining to Labour Codes and will evaluate impact if any on the measurement of liability pertaining to
employee benefits.

NOTE 36:

During the year ended 31 March, 2025, the Company has changed its name from 'PCBL Limited' to 'PCBL Chemical Limited'
pursuant to issuance of fresh Certificate of Incorporation dated 06 November, 2024 by Ministry of Corporate Affairs.