Shankesh Jewellers Ltd Management Discussions

OPERATIONS

You should read the following discussion and analysis of financial condition and results of operations together with our financial statements included in this Daft Red Prospectus. The following discussion relates to our Company and is based on our restated financial statements. Our financial statements have been prepared in accordance with Ind-AS and other applicable provisions of the Companies Act.

Note: Statement in the Management Discussion and Analysis Report describing our objectives, outlook, estimates, expectations or prediction may be "Forward looking statement" within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to our operations include, among others, economic conditions affecting demand/supply and price conditions in domestic and overseas market in which we operate, changes in Government Regulations, Tax Laws and other Statutes and incidental factors.

Industry Overview

Global growth, which reached 3.5% in CY23, stabilized at 3.3% for CY24 and projected to decrease at 3.0% for CY25. Global trade is expected to be disrupted by new US tariffs and countermeasures from trading partners, leading to historically high tariff rates and negatively impacting economic growth projections. The global landscape is expected to change as countries rethink their priorities and policies in response to these new developments. Central banks priority will be to adjust policies, while smart fiscal planning and reforms are key to handling debt and reducing global inequalities.

Chart 1: Global Growth Outlook Projections (Real GDP, Y-o-Y change in %)

Source: IMF World Economic Outlook, July 2025; Notes: P-Projection, E-Estimated

Indias per capita GDP has shown a consistent upward trend over the past decade, reflecting steady economic growth. Rising per capita income, driven by robust economic development, enhances consumer confidence and discretionary spending, reflecting a higher standard of living and overall prosperity. From FY13 to FY25, the per capita GDP is expected to increase from Rs 80,518 to Rs 234, 859, with an average growth rate of around 9 % annually. Key drivers of this growth include structural reforms, digitalization, rising domestic consumption, and increased foreign investment. However, there was a slight dip in FY20, primarily due to the economic impact of the COVID-19 pandemic. Despite this, the country has rebounded with strong growth rates in subsequent years, supported by economic recovery and continued expansion in various sectors.

MOSPI; Note: FE Final Estimates, FRE- First Revised Estimates, PE- Provisional Estimates

Our Business

We are engaged in the business of hand crafted gold jewellery and providing customisation services to our clients. Our Clientele includes both corporate entities such as Joyalukkas India Limited, P. N. Gadgil & Sons Limited, Kalyan

Jewellers India Limited, P N Gadgil Jewellers Limited, Manoj Vaibhav Gems N Jewellers Limited, Novel Jewels

Limited (Aditya Birla Group), Bhima Jewellery Madurai, Hari Prasad Gopi Krishna Saraf Private Limited, D.P Abhushan Limited, Vysyaraju Jewellers Private Limited, Gajaananda Jewellery Mart India Private Limited, Arundhati Jewellers Pvt. Ltd. amongst others and Non-corporate entities such as Verma Jewellers and Sham Jewellers amongst others. We act as principal contractor, managing the design, material sourcing, and finished Jewellery making process for these clients. Depending upon type of the Jewellery the actual production is outsourced to relevant localised Karigars through Jobworkers who are handled by us on behalf of the client for ensuring the end-to-end delivery of the final product to the client as per their specific design requirements. This model is common in the jewellery industry, allowing the wholesaler to focus on inventory management, specialize in design and marketing without investing in manufacturing infrastructure. Our office is located at Mumbai, Maharashtra and we are distributing our products to reputable nation-wide corporate and non-corporate clients.

We offer a diverse range of high-quality hand crafted gold jewellery in 22-karat and 18-karat. Our product portfolio encompasses an extensive collection of Bangles, Bridal Jewellery, Chokers, Jhumkas, Long and Short Necklace sets, Mangal Sutra and Rings and combined jewellery sets in categories of Antique Jewellery, Semi-Antique Jewellery, Calcutta Jewellery, Temple Jewellery, Gheru Polish and Yellow/ Rodium/ Rose Gold Jewellery with the capability to create customized jewellery tailored to customer specifications. These pieces are suited for all occasions such as weddings, festivals, and daily wear, thereby addressing the diverse needs of our PAN India clientele. Our Gold jewellery are hallmarked as per BIS standard in accordance with regulatory guidelines.

In addition to standard product offerings, our Company provides custom job work services where clients supply bullion along with specific design requirements, and our company engages Karigars through Jobworker s to craft the jewellery accordingly. Once completed, we deliver the finished pieces directly to our clients, ensuring seamless and high-quality service.

Significant Developments after March 31, 2023 that may affect our Future Results of Operations

Except as mentioned in Risk Factors and as mentioned below, there is no significant development.

The Company has allotted 1,87,75,800 equity shares as fully paid-up bonus shares to its existing equity shareholders in the ratio of 1:1 by capitalization of profits transferred from free reserves amounting to Rs. 187.76 million on 22nd August 2023 pursuant to a special resolution passed by the shareholders in Extra Ordinary General Meeting after taking consent of shareholders.

FACTORS AFFECTING OUR RESULT OF OPERATIONS

Except as otherwise stated in the Draft Red Herring Prospectus and the Risk Factors given in the Draft Red Herring Prospectus, the following important factors could cause actual results to differ materially from the expectations include, among others:

General economic and market conditions in India and globally

Our business is significantly influenced by the economic and political conditions both in India and globally. The overall economic and political landscape in India and other countries can have a significant impact on the commodities market, which in turn can affect our business. These conditions encompass a range of factors such as macroeconomic policies, industry-specific trends, legislation and regulations, market fluctuations, consumer confidence, and currency and interest rate fluctuations.

It is important to note that market conditions can change rapidly in response to adverse economic and political circumstances. In such cases, we may face challenges in promptly and effectively adapting to these changes. This could potentially have a material adverse effect on our business, financial condition, cash flows, results of operations, and future prospects.

Therefore, it is crucial for us to closely monitor and assess the general economic and political conditions in order to mitigate any potential risks and make informed decisions for the success of our business.

Ability to expand our design portfolio for our product offering, retain existing customers and attract new customers

Our ability to expand our design portfolio for our product offering, retain existing customers, and attract new customers is a critical factor influencing our results of operations and financial condition. We recognize that customer satisfaction, loyalty, and continuous innovation are essential to maintaining and growing our market position. The following aspects play a pivotal role in this area:

1. Expand our design portfolio: We offer a diverse range of high-quality hand crafted gold jewellery in 22-karat and 18-karat. Our product portfolio encompasses an extensive collection of Bangles, Bridal Jewellery, Chokers, Jhumkas, Long and Short Necklace sets, Mangal Sutra and Rings and combined jewellery sets in categories of Antique Jewellery, Semi-Antique Jewellery, Calcutta Jewellery, Temple Jewellery, Gheru Polish and Yellow/ Rodium/ Rose Gold Jewellery with the capability to create customized jewellery tailored to customer specifications. These pieces are suited for all occasions such as weddings, festivals, and daily wear, thereby addressing the diverse needs of our PAN India clientele. Our ability to introduce new designs for our product offering that align with current trends, consumer preferences, and market demands is key to expanding our customer base and enhancing our revenue streams.

2. Retention of existing customers: We have fostered long standing relationships with several jewellery businesses, including corporate jewellery brands, such as Joyalukkas India Limited, P N Gadgil Jewellers Limited, Kalyan Jewellers India Limited, P. N. Gadgil & Sons Limited, Novel Jewels Limited(Aditya Birla Group), Shree Banwarilal Jewellers Private Limited, Bhima Enterprises Madurai, Hari Prasad Gopi Krishna Saraf Private Limited, D.P Abhushan Limited, Vysyaraju Jewellers Private Limited, Gajaananda Jewellery Mart India Private Limited and numerous other esteemed clients. These relationships have been built on our ability to provide a wide range of designs for our product offering tailored to the needs of our clients by understanding market preferences. In the Fiscal years 2025, 2024 and 2023, our revenue from operations were 14,038.26 million, 10,617.83 million and

9,091.93 million respectively.

During the Fiscal Years 2025, 2024 and 2023, the share of our top customers to our revenue from operations was as follows:

	FY 2025		FY 2024		FY 2023
Particulars	Revenue ( in Million)	% of Total Revenue	Revenue ( in Million)	% of Total Revenue	Revenue ( in Million)	% of Total Revenue
Top 1 Customer	905.57	6.45%	567.95	5.35%	620.64	6.83%
Top 5 Customer	2,795.58	19.91%	2,098.78	19.77%	1,918.63	21.10%
Top 10 Customer	4,278.43	30.48%	3,251.29	30.62%	2,862.00	31.48%

Retaining our existing customer base is one of the primary factors that is vital in ensuring revenue growth and driving long-term financial stability.

Cost of procuring raw materials and manufacturing of our products

The cost of procuring raw materials, along with the manufacturing of our products, is a significant factor that directly impacts our results of operations and financial condition. Our jewellery production is primarily dependent on raw materials, including gold bar, stones and alloy. These raw materials represent a substantial portion of our overall cost structure and have a direct impact on our profitability and cost management strategies.

Set forth below is a break-up of raw materials obtained from our suppliers in the corresponding periods:

	FY 2025		FY 2024		FY 2023
Particulars	Purchase Cost	% of Total Purchase	Purchase Cost	% of Total Purchase	Purchase Cost	% of Total Purchase
Gold Bar	11,526.68	87.12%	8,500.08	85.61%	7,521.54	84.26%
Gold Ornaments	1,693.40	12.80%	1,419.26	14.30%	1,394.55	15.62%
Stones	0.12	0.00%	8.92	0.09%	8.83	0.10%
Miscellaneous	10.85	0.08%	0.03	0.00%	2.08	0.02

Our business is significantly dependent on timely procurement, quality and price of our raw material, especially gold, for jewellery production. As a result, we are exposed to fluctuations in the price and availability of gold, both of which are influenced by regulatory factors such as import duties, global economic conditions, geopolitical factors, and fluctuations in demand and supply in the international markets.

Consumer spending and general economic and market conditions

Domestic demand is fuelled by rising disposable incomes, urbanization, and a growing preference for lightweight, modern designs, especially among younger consumers. On the export front, markets like the U.S., UAE, and Hong Kong continue to drive growth. Trade agreements and government support for export-oriented policies further strengthen

India s position in the global market. ( Source: CareEdge Report )

While the sector holds immense potential, it faces challenges such as gold price volatility, dependency on imports, and increasing competition from synthetic diamonds. Fluctuations in international demand and compliance with stringent regulatory norms also pose risks. However, these hurdles are being addressed through policy interventions, innovation, and diversification. ( Source: CareEdge Report )

Our business is significantly influenced by consumer spending patterns, general economic conditions, and broader market dynamics. Domestic and international demand for our products is driven by various factors, including rising disposable incomes, urbanization, and changing consumer preferences.

Significant Accounting Policies

Restated Ind-AS Consolidated Summary Statements

1. BASIS OF PREPARATION OF FINANCIAL STATEMENTS (a) Basis of preparation

The Restated Standalone Financial Information have been prepared by the management from:

a) the Audited Standalone Financial Statements of the company as at and for the financial year ended March 31,

2025 prepared in accordance with the Indian accounting Standards (referred to as " Ind AS " ) as prescribed under

Section 133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, and other accounting principles generally accepted in India which have been approved by the Board of Directors at their meeting held on September 16, 2025; and

b) the special purpose audited Ind AS financial statements (based on the previously issued audited financial statements prepared in accordance with Section 133 of the Act and the rules thereunder, as adjusted for the differences in the accounting principles adopted by the Company on transition to the Indian Accounting Standards Ind AS) of the Company as at and for the year ended March 31, 2024 and March 31, 2023 prepared in accordance with Indian Accounting Standard (referred to as " Ind AS " ) as prescribed under Section 133 of the Act read with Companies (Indian Accounting Standards) Rules 2015, as amended, and other accounting principles generally accepted in India, which have been approved by the Board of Directors at their meeting held on September 20, 2025. These special purpose audited Ind AS financial statements have followed the accounting policies and groupings/classifications followed as at and for the year ended on March 31, 2025.

(b) Basis of measurement

These restated financial statements are prepared under historical cost convention unless otherwise indicated.

(c) Functional and Presentation Currency

The Restated Financial statement are prepared in Indian rupees rounded off to the nearest million except for share data and per share data, unless otherwise stated

(d) Use of Estimate and Judgements

The presentation of the Restated Financial Statement is in conformity with Ind-AS which requires the management to make judgements and estimates about the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The management believes that the judgements and estimates used in preparation of the Financial Statements are prudent and reasonable.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future period.

Estimates and assumptions are required in particular for:

(i) Useful life and residual value of property, plant and equipment and intangible assets;

Useful lives of tangible assets are based on the life prescribed in Schedule II of the Companies Act, 2013. In cases, where the useful lives are different from that prescribed in Schedule II, they are based on technical advice, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement, anticipated technological changes, manufacturers warranties and maintenance support. Assumptions also need to be made, when the Company assesses, whether an asset may be capitalised and which components of the cost of the asset may be capitalised.

(ii) Impairment of Non Financial Assets

Determining whether the asset is impaired requires to assess the recoverable amount of the asset or Cash Generating Unit (CGU) which is compared to the carrying amount of the asset or CGU, as applicable. Recoverable amount is the higher of fair value less costs of disposal and value in use. Where the carrying amount of an asset or CGU exceeds the recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

Key source of estimate uncertainty

(i) Impairment of trade receivables:

The impairment provisions for trade receivables are based on assumptions about risk of defaults and expected loss rates. The company uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based on the Company s past history, existing market conditions as well as forward looking estimates at the end of each reporting period.

(ii) Legal and other disputes:

The Company provides for anticipated settlement cost where an outflow of resources is considered probable and a reliable estimate may be made of the likely outcome of the dispute and legal and other expenses arising from claims against the company. These estimates take into account the specific circumstances of each dispute and relevant external advice which are inherently judgmental and could change substantially over times as new facts emerge and each dispute progress.

(iii) Post-employment benefits:

The costs of providing gratuity and other post-employment benefits are charged to the statement of profit and loss in accordance with Ind AS 19 Employee benefits over the period during which benefits derived from the employee s services. The costs are assessed on the basis of assumptions selected by management. These assumptions include future earnings and salary increases, discount rate, expected long-term rates of return on assets and mortality rates.

(iv) Assumptions are also made by the management with respect to valuation of inventories, evaluation of recoverability of deferred tax, contingencies, determination of useful lives of Property, Plant and Equipment s and measurement of recoverable amounts of cash generating units. All assumptions are reviewed at each reporting date.

2. SIGNIFICANT ACCOUNTING POLICIES: a) Property, Plant and Equipment & Depreciation (i) Recognition and Measurement

Items of property, plant and equipment are measured at cost less accumulated depreciation and impairment losses, if any. The cost of an item of property, plant and equipment comprises:

o its purchase price, including import duties and non-refundable purchase taxes, after deducting trade discounts and rebates.

o borrowing cost and any costs directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

o the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located, the obligation for which the Company incurs either when the item is acquired or as a consequence of having used the item during a particular period for purposes other than to produce inventories during that period.

Income and expenses related to the incidental operations, not necessary to bring the item to the location and condition necessary for it to be capable of operating in the manner intended by management, are recognised in the Statement of Profit and Loss. If significant parts of an item of property, plant and equipment have different useful lives, then they are accounted for as separate items (major components) of property, plant and equipment.

Any gain or loss on disposal of an item of property, plant and equipment is recognised in Statement of Profit and Loss. Cost of Items of Property, plant and equipment not ready for intended use as on the balance sheet date, is disclosed as capital work in progress. Advances given towards acquisition of property, plant and equipment outstanding at each balance sheet date are disclosed as Capital Advance under Other non-current assets

(ii) Subsequent Expenditure

Subsequent expenditure relating to PPE is capitalised only if such expenditure results in an increase in the future benefits from such asset beyond its previously assessed standard of performance.

b) Intangible Assets

(i) Recognition and Measurement

Intangible assets comprising of Computer Software are stated at acquisition cost, including any cost attributable for bringing the asset to its working condition, less accumulated amortization and impairment losses, if any. Technology support cost and annual maintenance cost for such software is charged annually to the Statement of Profit and Loss.

(ii) Subsequent Expenditure

Other Intangible assets are recognized where it is probable that future economic benefit attributable to the assets will flow to the company and its cost can be reliably measured.

c) Depreciation / Amortisation

Depreciation is the systematic allocation of the depreciable amount of PPE over its useful life.

Depreciation on property, plant and equipment is provided, using the Written down Value method (WDV), pro-rata to the year of use of assets, at the rates specified in Schedule II of the Companies Act, 2013 with exception the following:

- In case of assets, falling under the block of Building, constructed on rental premises, depreciation is provided either on the basis of useful life of the assets as estimated by the management or rental period whichever is lower.

- Assets costing Rs. 10,000 or less are fully depreciated in the year of purchase.

Intangible assets are amortised over the economic useful life estimated by the management. Intangible assets being the computer software is amortised over a period of three years.

The management s estimated useful life/ useful life as per schedule II whichever is lower for the various tangible assets are as follows:

Assets	Estimated useful life (Years)
Furniture and Fixtures	10 Years
Office equipment	5 Years
Computers	3 Years
Vehicles	8 Years
Leasehold land	Period of Lease

d) Impairment

At the end of each reporting period, the Company reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).

The following intangible assets are tested for impairment each financial year even if there is no indication that the asset is impaired:

(a) an intangible asset that is not yet available for use; and

(b) an intangible asset that is amortised over a period exceeding ten years from the date when the asset is available for use.

If the carrying amount of the assets exceeds the estimated recoverable amount, impairment is recognised for such excess amount. The impairment loss is recognised as an expense in the Statement of Profit and Loss, unless the asset is carried at revalued amount, in which case any impairment loss of the revalued asset is treated as a revaluation decrease to the extent a revaluation reserve is available for that asset.

The recoverable amount is the greater of the net selling price and their value in use. Value in use is arrived at by discounting the future cash flows to their present value based on an appropriate discount factor.

When there is indication that an impairment loss recognised for an asset (other than a revalued asset) in earlier accounting periods no longer exists or may have decreased, such reversal of impairment loss is recognised in the Statement of Profit and Loss, to the extent the amount was previously charged to the Statement of Profit and Loss. In case of revalued assets, such reversal is not recognised.

e) Financial Instruments

(i) Recognition initial measurement

Trade receivables and debt securities issued are initially recognised when they are originated. All other financial assets and financial liabilities are initially recognised when the Company becomes a party to the contractual provisions of the instrument.

A financial asset or financial liability is initially measured at fair value plus, for an item not at fair value through profit and loss (FVTPL), transaction costs that are directly attributable to its acquisition or issue.

(ii) Financial Assets

Classification

The Company classifies financial assets as subsequently measured at amortised cost, fair value through other comprehensive income or fair value through profit or loss on the basis of its business model for managing the financial assets and the contractual cash flow characteristics of the financial asset.

Initial recognition and measurement

All financial assets (not measured subsequently at fair value through profit or loss) are recognised initially at fair value plus transaction costs that are attributable to the acquisition of the financial asset. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognised on the trade date, i.e., the date that the Company commits to purchase or sell the asset.

Impairment of financial assets

In accordance with Ind-AS 109, the Company applies Expected Credit Loss (ECL) model for measurement and recognition of impairment loss on the following financial assets and credit risk exposure:

a) Financial assets that are debt instruments, and are measured at amortised cost e.g. loans, debt securities, deposits, and bank balance.

b) Trade receivables.

The Company follows simplified approach for recognition of impairment loss allowance on trade receivables which do not contain a significant financing component.

The application of simplified approach does not require the Company to track changes in credit risk. Rather, it recognises impairment loss allowance based on lifetime ECLs at each reporting date, right from its initial recognition.

(iii) Financial Liabilities

Classification

The Company classifies all financial liabilities as subsequently measured at amortised cost, except for financial liabilities at fair value through profit or loss. Such liabilities, shall be subsequently measured at fair value

Initial recognition and measurement

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and borrowings or payables, as appropriate.

All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs.

The Company s financial liabilities include trade and other payables, loans and borrowings including bank overdrafts.

Offsetting of financial instruments

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

Effective interest method

The company uses effective interest rate, determined using the effective interest method, for calculating the amortised cost of a financial instrument and of allocating interest income or expense over the relevant period.

Effective interest rate is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial asset or financial liability to the gross carrying amount of a financial asset or to the amortised cost of a financial liability. For calculating the effective interest rate, an entity shall estimate the expected cash flows by considering all the contractual terms of the financial instrument (for example, prepayment, extension, call and similar options) but shall not consider the expected credit losses. The calculation includes all fees and points paid or received between parties to the contract that are an integral part of the effective interest rate, transaction costs, and all other premiums or discounts.

f) Revenue recognition

Revenue from sales of products are recognized when the significant risks and rewards of ownership have been transferred to the buyer, recovery of the consideration is probable, the associated costs and possible return of goods can be estimated reliably, there is no continuing management involvement with the goods and the amount of revenue can be measured reliably.

Revenue is measured at the fair value of the consideration received or receivable. Revenue is recognized upon transfer of control of promised products or services to customers/patients in an amount that reflects the consideration we expect to receive in exchange for those products or services. Sales and Service Income exclude Goods and Service Tax (GST) and are net of trade / volume discounts, where applicable.

Export benefits available under prevalent schemes are accrued in the year in which the goods are exported and no significant uncertainty exist regarding its ultimate collection. Interest income is recognised with reference to the Effective Interest Rate method.

g) Employee benefits

Short term employee benefits

Short-term employee benefits are expensed as the related service is provided. A liability is recognised for the amount expected to be paid if the company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

Defined contribution plans

Obligations for contributions to defined contribution plans are expensed as the related service is provided. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in future payments is available.

Defined benefit plans

The Company s net obligation in respect of defined benefit plans is calculated by estimating the amount of future benefit that employees have earned in the current and prior periods.

The calculation of defined benefit obligations is performed annually by a qualified actuary using the projected unit credit method.

Remeasurement of the net defined benefit liability, which comprise of actuarial gains and losses are recognised immediately in other comprehensive income (OCI). Net interest expense (income) on the net defined liability (assets) is computed by applying the discount rate, used to measure the net defined liability (asset). Net interest expense and other expenses related to defined benefit plans are recognised in Statement of Profit and Loss.

Other long-term employee benefits

The Company s net obligation in respect of long-term employee benefits is the amount of future benefit that employees have earned in return for their service in the current and prior periods. That benefit is discounted to determine its present value.

Actuarial gains and losses are recognised in other comprehensive income (OCI) in the period in which they arise.

h) Leases

The Company has applied Ind AS 116 and at the commencement of the lease contract recognised a Right-of-Use (RoU) asset at cost and corresponding lease liability, except for leases with a term of twelve months or less (short-term leases) and leases for which the underlying asset is of low value (low-value leases). For these short-term and low-value leases, the Company recognizes the lease payments as an operating expense on a straight-line basis over the term of the lease.

The cost of the right-of-use assets comprises the amount of the initial measurement of the lease liability, adjusted for any lease payments made at or prior to the commencement date of the lease, any initial direct costs incurred by the Company, any lease incentives received and expected costs for obligations to dismantle and remove right-of-use assets when they are no longer used.

Subsequently, the right-of-use assets is measured at cost less any accumulated depreciation and accumulated impairment losses, if any. The right-of-use assets are depreciated on a straight-line basis from the commencement date of the lease over the shorter of the end of the lease term or useful life of the right-of-use asset.

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

For lease liabilities at commencement date, the Company measures the lease liability at the present value of the future lease payments as from the commencement date of the lease to end of the lease term. The lease payments are discounted using the interest rate implicit in the lease or, if not readily determinable, the Companys incremental borrowing rate for the asset subject to the lease in the respective markets.

Subsequently, the Company measures the lease liability by adjusting carrying amount to reflect interest on the lease liability and lease payments made.

The Company remeasures the lease liability (and makes a corresponding adjustment to the related right-of-use asset) whenever there is a change to the lease terms or expected payments under the lease, or a modification that is not accounted for as a separate lease

The portion of the lease payments attributable to the repayment of lease liabilities is recognized in cash flows used in financing activities, and the portion attributable to the payment of interest is included in cash flows from operating activities. Further, Short-term lease payments, payments for leases for which the underlying asset is of low-value and variable lease payments not included in the measurement of the lease liability is also included in cash flows from operating activities.

i) Operating cycle

Based on the nature of products / activities of the Company and the normal time between acquisition of assets and their realisation in cash or cash equivalents, the Company has determined its operating cycle as 12 months for the purpose of classification of its assets and liabilities as current and non-current.

j) Income tax

Income tax expense represents current and deferred tax. It is recognised in Statement of Profit and Loss except to the extent that it relates to items recognised directly in equity or in OCI.

Current tax

Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and any adjustment to the tax payable or receivable in respect of previous years. It is measured using tax rates enacted or substantively enacted at the reporting date.

Current tax assets and liabilities are offset only if, the Company: a) has a legally enforceable right to set off the recognised amounts; and b) Intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously. Deferred tax

Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.

Deferred tax assets are recognised for unused tax losses, unused tax credits and deductible temporary differences to the extent that it is probable that future taxable profits will be available against which they can be used. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised; such reductions are reversed when the probability of future taxable profits improves.

Unrecognised deferred tax assets are reassessed at each reporting date and recognised to the extent that it has become probable that future taxable profits will be available against which they can be used.

Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, using tax rates enacted or substantively enacted at the reporting date.

The measurement of deferred tax reflects the tax consequences that would follow from the manner in which the Company expects, at the reporting date, to recover or settle the carrying amount of its assets and liabilities.

Deferred tax assets and liabilities are offset only if:

a) the Company has a legally enforceable right to set off current tax assets against current tax liabilities; and

b) the deferred tax assets and the deferred tax liabilities relate to income taxes levied by the same taxation authority on the same taxable entity.

Current and deferred tax for the year are recognised in profit or loss, except when they relate to items that are recognised in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognised in other comprehensive income or directly in equity respectively. Where current tax or deferred tax arises from the initial accounting for a business combination, the tax effect is included in the accounting for the business combination.

k) Provisions, Contingent Liabilities and Contingent Assets

A provision is recognized when the Company has a present obligation as a result of past events and it is probable that an outflow of resources will be required to settle the obligation in respect of which a reliable estimate can be made. Provisions (excluding retirement benefits) are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates.

Contingent liabilities are disclosed in the Notes. Contingent liabilities are disclosed for

(1) possible obligations which will be confirmed only by future events not wholly within the control of the Company or

(2) 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 not recognised in the Financial Statements.

l) Earnings Per Share

Basic earnings per share is computed by dividing the profit / (loss) after tax by the weighted average number of equity shares outstanding during the year. Diluted earnings per share is computed by dividing the profit / (loss) after tax as adjusted for dividend, interest and other charges to expense or income (net of any attributable taxes) relating to the dilutive potential equity shares, by the weighted average number of equity shares considered for deriving basic earnings per share and the weighted average number of equity shares which could have been issued on conversion of all dilutive potential equity shares.

m) Cash and cash equivalents:

Cash and cash equivalents for the purpose of cash flow statement comprise cash at bank including fixed deposits (having original maturity of less than 3 months), cheques in hand and cash in hand.

n) Exceptional items:

When items of income and expense within profit or loss from ordinary activities are of such size, nature or incidence that their disclosure is relevant to explain the performance of the enterprise for the period, the nature and amount of such items is disclosed separately as Exceptional items.

RESULTS OF OUR OPERATIONS

( in Million)

Particulars	Year ended March 31, 2025	% of Total Income	Year ended March 31, 2024	% of Total Income	Year ended March 31, 2023	% of Total Income
Income
I Revenue from Operations	14,038.26	99.99%	10,617.83	99.99%	9,091.93	100.00
						%
II Other Income	1.11	0.01%	1.24	0.01%	0.10	0.00%
III Total Income (I+II)	14,039.38	100.00	10,619.07	100.00	9,092.03	100.00
		%		%		%
Expenses
(a) Cost of Material Consumed	13,559.16	96.58%	10,219.92	96.24%	9,191.24	101.09
						%
(c) Changes in Inventories	(301.58)	-2.15%	(55.90)	-0.53%	(451.06)	-4.96%
(d) Employee Benefits Expenses	96.62	0.69%	144.98	1.37%	101.69	1.12%
(e) Finance Cost	105.83	0.75%	106.52	1.00%	83.63	0.92%

Particulars	Year ended March 31, 2025	% of Total Income	Year ended March 31, 2024	% of Total Income	Year ended March 31, 2023	% of Total Income
(f) Depreciation and Amortisation Expenses	8.43	0.06%	8.37	0.08%	2.00	0.02%
(g) Other Expenses	30.59	0.22%	22.83	0.21%	24.13	0.27%
Total Expenses (IV)	13,499.05	96.15%	10,446.73	98.38%	8,951.63	98.46%
V Profit Before Tax (III-IV)	540.32	3.85%	172.34	1.62%	140.40	1.54%
VI Tax Expenses	137.20	0.98%	44.18	0.42%	35.97	0.40%
(1) Current tax	137.40	0.98%	44.77	0.42%	36.71	0.40%
(2) Deferred tax	(0.20)	0.00%	(0.59)	-0.01%	(0.74)	-0.01%
VII Profit After Tax (V-VI)	403.12	2.87%	128.16	1.21%	104.43	1.15%

Principal Components of our Profit and Loss Account

Income

Our total income comprises of revenue from operations and other income.

Revenue from Operations

Our revenue from operations as a percentage of total income were 99.99%, 99.99% and 100.00% respectively, for the fiscals March 31, 2025, March 31, 2023 and March 31, 2022. Revenue from operations comprises of (i) Sale of Products and (ii) Job work income.

Other Income

Our other income comprises of interest income on Fixed Deposits and security deposits and Gain on Sale of Property

Plant and Equipment. Other income, as a percentage of total income was 0.01%, 0.01% and 0.00% for the fiscal s year ended March 31, 2025, March 31, 2023 and March 31, 2022.

Expenses

Our total expenses primarily consist of Cost of Raw material consumed, Changes in Inventory, Employee Benefit Expenses, Finance Cost, Depreciation& Amortization Expenses and Other Expenses.

Cost of Material Consumed

Cost of Material Consumed denote the sum of opening stock, purchases of raw materials and packing materials and direct

expenses less closing stock of raw materials.

Changes in inventories of stock-in-trade:

Our changes in inventories of stock-in-trade denotes increase/decrease in inventories of stock-in-trade between opening and closing dates of a reporting period.

Employee Benefit Expenses

Employee benefits expenses include (i) salaries and allowances; (ii) directors remuneration; (iii) employer contribution to provident fund and other funds; (iv) provision for gratuity; and (v) staff welfare expenses.

Finance costs

Finance cost primarily consists of interest expenses on borrowings from bank, other borrowing costs and lease interest expenses.

Depreciation and Amortization Expenses

Depreciation and Amortization Expenses consist of depreciation on the Tangible assets & Intangible assets of our Company which primarily includes computer equipments, office equipment, furniture and fixture and vehicles etc.

Other Expenses

Other expenses mainly consist of Exhibition Expenses, Insurance, legal and professional fees, Rent, Rates & tax, travelling and conveyance, CSR expenses, Courier Charges, after sale services and miscellaneous expenses etc.

Provision for Tax

The provision for current taxation is computed in accordance with relevant tax regulation. Deferred tax is recognized on timing differences between the accounting and the taxable income for the year and quantified using the tax rates and laws enacted or subsequently enacted as on balance sheet date. Deferred tax assets are recognized and carried forward to the extent that there is a virtual certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized in future.

FISCAL 2025 COMPARED WITH FISCAL 2024

In fiscal 2025, our Revenue from Operations increased by 32.21% to 14,038.26 million, from 10,617.83 million in fiscal 2024 The increase in the year 2025 was primarily due to increase in sale prices of gold jewellery and increase in sales volume.

Other income decreased by 10.66% to 1.11 million from 1.24 million in fiscal 2024 because of Gain on sale of PPE.

Cost of Material Consumed

Cost of material consumed increased by 32.67% to 13,559.16 million from 10,219.92 million in fiscal 2024 in line with increase in sales, mainly driven by increase in purchase of raw materials.

Changes in inventories

Changes in inventories of stock-in-trade decreased by 439.55% to (301.58) in fiscal 2025 from (55.90) in fiscal 2024.

Such change was primarily due to decrease in the amount of opening stock of finished goods in Fiscal 2025 compared to Fiscal 2024.

Employee Benefit Expenses

Our employee benefit cost decreased by 33.36% to 96.62 million from 144.98 million in fiscal 2024. This decrease was mainly due to decrease in Director s remuneration.

Finance Cost

Finance cost decreased by 0.65% to 105.83 million from 106.52 million in fiscal 2024. The decrease was mainly due to decrease in interest on unsecured loans.

Depreciation Expenses

Depreciation expenses increased by 0.67% to 8.43 million from 8.37 million in fiscal 2024. This increase was majorly on account of addition in PPE and correspondingly increase in depreciation and amortization of assets.

Other Expenses

Other expenses increased by 34.02% to 30.59 million from 22.83 million in fiscal 2024. The increase was majorly due to increase Courier charges, Professional fees and Interest on late payment of TDS.

Profit/ (Loss) before Tax

The increase in sales, effective cost management and improved operational efficiency has led to increase in our Profit before tax by 213.52% to 540.32 million from 172.34 million in fiscal 2024.

Tax Expense

Tax expenses increased by 210.54% to 137.20 million in Fiscal 2025 from 44.18 million in Fiscal 2024 due to increase in income & decrease in deferred tax expenses.

Profit/ (Loss) after Tax

After accounting for taxes at applicable rates, our Profit after Tax increased by 214.54% to 403.12 million from 128.16 million in fiscal 2024.

FISCAL 2024 COMPARED WITH FISCAL 2023

In fiscal 2024, our Revenue from Operations increased by 16.78% to 10,617.83 million, from 9,091.93 million in fiscal 2023 The increase in the year 2024 was due to various factors such as effective marketing strategies, improved operational efficiency, and favorable market conditions.

Other income increased by 1167.01% to 1.24 million from 0.10 million in fiscal 2023 due to increase in non-operating income.

Cost of Material Consumed

Cost of material consumed increased by 11.19% to 10,219.92 million from 9,191.24 million in fiscal 2023. Due to increase in purchase of raw materials, increased in demand for raw materials etc.

Changes in inventories

Changes in inventories of stock-in-trade increased by 87.61% to (55.90) in fiscal 2024 from (451.06) in fiscal 2023.

Such change was primarily due to increase in the amount of opening stock of finished goods in Fiscal 2025 compared to Fiscal 2024.

Employee Benefit Expenses

Our employee benefit cost increased by 42.57% to 144.98 million from 101.69 million in fiscal 2023 This increase was mainly due to increase in Director s remuneration and salaries expenses.

Finance Cost

Finance cost increased by 27.37% to 106.52 million from 83.63 million in fiscal 2023. The increase was mainly due to increase in fixed interest obligation expenses.

Depreciation Expenses

Depreciation expenses increased by 319.53% to 8.37 million from 2.00 million in fiscal 2023. This increase was majorly on account of addition in PPE and correspondingly increase in depreciation and amortization of assets.

Other Expenses

Other expenses decreased by 5.39% to 22.83 million from 24.13 million in fiscal 2023. The decrease was majorly due to decrease in rent and other expenses.

Profit/ (Loss) before Tax

The increase in sales, effective cost management and improved operational efficiency has led to increase in our Profit before tax by 22.75% to 172.34 million from 140.40 million in fiscal 2023.

Tax Expense

Tax expenses increased by 22.83% to 44.18 million in Fiscal 2024 from 35.40 million in Fiscal 2023 due to increase in income & decrease in deferred tax expenses.

Profit/ (Loss) after Tax

After accounting for taxes at applicable rates, our Profit after Tax increased by 22.73% to 128.16 million from 104.43 million in fiscal 2023.

Cash Flows

( in millions)

Particulars	Fiscal year ended 2025	Fiscal year ended 2024	Fiscal year ended 2023
Cash Flow From (utilized
	(231.05)	14.71	(75.37)
in) operating activities
Cash Flow From (utilized
	(28.95)	(10.12)	(0.29)
in) investing activities
Cash Flow From (utilized
	258.47	(4.86)	75.49
in) financing activities

Cash Flows from Operating Activities

Net cash utilized in operating activities in fiscal 2025 was (231.05) million as compared to the PBT of 540.32 million for the same period. This difference is primarily on account of interest on borrowings of 98.74 million, changes in trade receivables of 390.65 million and changes in inventories of 301.58 million.

Net cash flow from operating activities in fiscal 2024 was 14.71 million as compared to the PBT of 172.34 million for the same period. This difference is primarily on account of interest on borrowings of 101.27 million, changes in trade payables of 215.88 million, changes in trade receivables of 37.33 million and changes in inventories of 55.90 million.

Net cash flow from operating activities in fiscal 2023 was (75.37) million as compared to the PBT of 140.40 million for the same period. This difference is primarily on account of interest on borrowings of 79.62 million, changes in trade payables of 166.55 million and changes in inventories of 451.06 million.

Cash Flows from Investment Activities

In fiscal 2025, the net cash invested in Investing Activities was 28.95 million. This was majorly on account of purchase of Property, plant & equipment & fixed deposits.

In fiscal 2024, the net cash invested in Investing Activities was 10.12 million. This was majorly on account of purchase of Property, plant and equipment and purchase of investments.

In fiscal 2023, the net cash invested in Investing Activities was 0.29 million. This was majorly on account of purchase of Property, plant and equipment.

Cash Flows from Financing Activities

Net cash flow from financing activities in fiscal 2025 was of 258.47 million. This was majorly on proceeds received from term loans of 814.40 million & loans repaid during the year of 451.78 million.

Net cash utilized in financing activities in fiscal 2024 was (4.86) millions. This was majorly on proceeds received from term loans of 1,153.65 million & loans repaid during the year of 1,051.85 million.

Net cash utilized in financing activities in fiscal 2023 was 75.49 million. This was majorly on proceeds received from term loans of 961.48 million & loans repaid during the year of 806.38 million.

Contingent Liabilities

The following table sets forth our contingent liabilities as of March 31, 2025:

Contingent Liability	FY 2025	FY 2024	FY 2023
Income Tax Demand	8.00	8.00	4.61

OTHER MATTERS

1. Significant economic changes that materially affect or are likely to affect income from continuing operations

Other than as described in the Section titled " Financial Information " and chapter titled " Management s Discussion and

Analysis of Financial Conditions and Results of Operations " , beginning on pages. 72 and 293 respectively of Draft Prospectus respectively, to our knowledge there are no significant economic changes that materially affected or are likely to affect income from continuing Operations.

2. Known trends or uncertainties that have had or are expected to have a material adverse impact on revenue or income from continuing operations

Other than as described in the chapter titled " Risk Factors " and " Management s Discussion and Analysis of Financial

Conditions and Result of Operations " , beginning on page 40 and 293 respectively of Draft Prospectus, best to our knowledge there are no known trends or uncertainties that have or had or are expected to have a material adverse impact on revenues or income of our Company from continuing operations.

3. Future relationship between Costs and Income

Other than as described in the chapter titled " Risk Factors " beginning on page 40 of Draft Prospectus, best to our knowledge there are no factors, which will affect the future relationship between costs and income or which are expected to have a material adverse impact on our operations and finances.

4. Any significant dependence on single or few suppliers or customers

The income from top Ten customers comprises of 30.48%, 30.62% and 31.48% of our Revenue from Operation for the Fiscal 2025, Fiscal 2024 and Fiscals 2023 respectively. The purchases from top ten supplier comprises of 88.45%, 85.35% and 86.88% of our total purchases for the Fiscal 2025, Fiscal 2024 and Fiscals 2023 respectively. For further details, please refer chapter " Risk Factors " beginning on page 40 of Draft Prospectus.