i. Provisions, Contingent Liability and Contingent Assets:

Provisions are recognized only when there is a present obligation, as a result of past events and when a
reliable estimate of the amount of obligation can be made at the reporting date. These estimates are
reviewed at each reporting date and adjusted to reflect the current best estimates. Provisions are
discounted to their present values, where the time value of money is material.

Contingent liability is disclosed for: a. Possible obligations which will be confirmed only by future
events not wholly within the control of the Company; or b. Present obligations arising from past events
where it is not probable that an outflow of resources will be required to settle the obligation or a reliable
estimate of the amount of the obligation cannot be made.

Contingent assets are neither recognized nor disclosed except when realization of income is virtually
certain, related asset is recognized.

j. Operating Segments:

Operating segments are reported in a manner consistent with the internal reporting provided to the Chief
Operating Decision Maker (‘CODM’) of the Company. The CODM is responsible for allocating resources
and assessing performance of the operating segments of the Company.

k. Earnings per Share:

Basic earnings per share are calculated by dividing the net profit for the period attributable to equity
shareholders by the weighted average number of equity shares outstanding during the period.

For the purpose of calculating diluted earnings per share, the net profit for the period attributed to
equity shareholders and the weighted average number of shares outstanding during the period is
adjusted for the effects of all potentially dilutive equity shares.

l. Cash and Cash Equivalents:

For the purpose of the Standalone Statement of Cash Flows, cash and cash equivalents consist of cash
and cheques in hand, bank balances, demand deposits with banks where the original maturity is three
months or less and other short-term highly liquid investments net of outstanding bank overdrafts and
cash credit facilities as they are considered an integral part of the Company’s cash management.

m. Functional and presentation currency:

Items included in the standalone financial statements of the Company are measured using the currency
of the primary economic environment in which the Company operates (i.e. the “functional currency”).
The standalone financial statements are presented in Indian Rupee, the national currency of India,
which is the functional currency of the Company.

n. Related Party Disclosure:

List of related parties where control exists and also related parties with whom transactions have taken
place and relationships, has been disclosed in Note No. 32 to the Notes to Accounts.

p. As certified by the company that it was received written representation from all the directors, that
companies in which they are directors had not defaulted in terms of section 164(2) of the companies
Act, 2013, and the representation from directors taken in Board that Director is disqualified from being
appointed as Director of the company.

q. Expenditure:

Expenses are net of taxes recoverable, where applicable.

r. Other Note:

As per the Ministry of Corporate Affairs (MCA) notification, proviso to Rule 3(1) of the Companies
(Accounts) Rules, 2014, for the financial year commencing April 1, 2023, every company 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 interpretation and guidance on what level
edit log and audit trail needs to be maintained evolved during the year and continues to evolve.

In the company, the accounting software has a feature of audit trail, but it was disable at an
application level for maintenance of books of accounts and relevant transactions. However, the
global standard ERP used by the Company has not been enabled with the feature of audit trail log at
the database layer to log direct transactional changes, due to present design of ERP. This is being
taken up with the vendor. In the meanwhile, the Company continues to ensure that direct write
access to the database is granted only via an approved change management process.

S. Equity Share Capital:

During the year the company has issued 2,00,00,000 equity shares at the price of Rs. 15.75/- per share
on preferential basis. Pursuant to this allotment, the paid-up share capital of the Company is increased
to Rs. 22,51,13,000/-

5C. Significant management judgement in applying material and other accounting policies and
estimation uncertainty:

The preparation of the Company’s financial statements requires the management to make judgements,
estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and
the accompanying disclosures, and the disclosure of contingent liabilities:

• Recoverability of advances / receivables

At each balance sheet date, based on historical default rates observed over expected life, the
management assesses the expected credit losses on outstanding receivables and advances.

• Provisions

At each balance sheet date basis the management judgment, changes in facts and legal aspects, the
Company assesses the requirement of provisions against the outstanding contingent liabilities.
However, the actual future outcome may be different from this judgement.

• Contingencies

Contingent liabilities may arise from the ordinary course of business in relation to claims against
the Company. By their nature, contingencies will be resolved only when one or more uncertain
future events occur or fail to occur. The assessment of the existence, and potential quantum, of
contingencies inherently involves the exercise of significant judgments by management and the use
of estimates regarding the outcome of future events

• Fair value measurements

Management applies valuation techniques to determine the fair value of financial instruments
(where active market quotes are not available) and share based payments. This involves developing
estimates and assumptions consistent with how market participants would price the instrument. The
Company engages third party valuers, where required, to perform the valuation. Information about
the valuation techniques and inputs used in determining the fair value of various assets, liabilities
and share based payments are disclosed in the notes to standalone financial statements.

• Inventories

The Company estimates the net realizable values of inventories, taking into account the most
reliable evidence available at each reporting date. The future realization of these inventories may be
affected by future demand or other market-driven changes that may reduce future selling prices.

• Income taxes

The Company’s tax jurisdiction is India. Significant judgements are involved in estimating
budgeted profits for the purpose of paying advance tax, determining the provision for income taxes,
including amount expected to be paid / recovered for uncertain tax positions. The extent to which
deferred tax assets/minimum alternate tax credit can be recognized is based on management’s
assessment of the probability of the future taxable income against which the deferred tax
assets/minimum alternate tax credit can be utilized.

For and on behalf of the board of directors As per our attached report of even date

For, Chandrima Mercantiles Limited For, V S S B & Associates

Chartered Accountants
Firm No. 121356W

Dinesh Hareshbhai Gohel Pranav Trivedi (Shridhar Shah)

Managing Director & CFO Director (Partner)

(DIN: 11061856) (DIN: 09218324) M No:-138132

UDIN: 2513813 2BMGCPR943 0

Manish Daya
Company Secretary

Place : Ahmedabad Place : Ahmedabad

Date : 19/05/2025 Date :19/05/2025