(i) The amount of expenditure recognised in the carrying amount of property, plant and equipment (including capital work-in progress) in the course of construction is T 8.78 crores (March 31, 2024: T 4.67 crores) [Refer Note 39].

(ii) Land admeasuring 18.94 acres amounting to T 77.84 crores is registered in the name of Mangal Industries Limited, erstwhile Company from which plastic component business was demerged and merged with the Company pursuant to the Scheme of Arrangement approved by Hon'ble National Company Law Tribunal [Refer Note 47]. The aforementioned land parcel is pending registration in the name of the Company.

Leasehold land admeasuring 15.66 acres amounting to ? 25.85 crores is registered in the name of Mangal Industries Limited, erstwhile Company from which plastic component business was demerged and merged with the Holding Company pursuant to the Scheme of Arrangement approved by Hon'ble National Company Law Tribunal [Refer Note 47]. The aforementioned lease is pending to be registered in the name of the Holding Company.

The Company holds shares of Inobat AS and Log 9 Materials Scientific Private Limited. The management of the Company do not consider that the Company is able to exercise significant influence over these entities as majority of the equity share capital is held by other shareholders, who also manage the day-to-day operations of these entities.

The valuation methodology for these investments is disclosed in Note 43D.

These investments are not held for trading. Instead, they are held for medium to long-term strategic purposes. Accordingly, the management of the Company have elected to designate these investments in equity instruments as at FVTOCI as they believe that recognising short-term fluctuations in these investments' fair value in profit or loss would not be consistent with the Company's strategy of holding these investments for long-term purposes and realising their performance potential in the long run.

(i) The average credit period for after market sales is one week and for sales to other customers is in the range of 30 - 60 days. No interest is charged on overdue receivables, except for overdue balances of related parties.

(ii) Of the trade receivables balance, T 188.70 crores (as at March 31, 2024: T 224.58 crores) is due from one of the Company's large customer (March 31, 2024: two of the Company's large customers). There are no other customers who represent more than 10% of the total balance of trade receivables.

(iii) The Company has used a practical expedient by computing the expected credit loss allowance for doubtful trade receivables based on a provision matrix. The provision matrix takes into account historical credit loss experience and adjusted for forwardlooking estimates. The expected credit loss allowance is based on the ageing of the receivables which are due and the rates used in the provision matrix.

(ii) Rights, preferences and restrictions attached to the equity shares:

The Company has only one class of shares referred to as equity shares having a face value of T 1 each. Each holder of equity share is eligible for one vote per share held. The Company declares and pays dividends in Indian rupees and foreign currency. The dividend proposed by the Board of Directors is subject to the approval of the Shareholders in the ensuing Annual General Meeting, except in the case of interim dividend. In the event of liquidation, the holders of equity shares will be entitled to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to the number of equity shares held by the shareholders.

Pursuant to the business combination approved by Hon'ble National Company Law Tribunal which was effective from February 1, 2024, term loans were transferred in the name of the Company.

(ii) The interest free sales tax deferment loans were availed by the Company under the Government of Andhra Pradesh TARGET 2000 New Industrial Policy as per which the loans are repayable at the end of the 14^th year from the year in which these loans were availed. The Company has also entered into agreements with the Deputy Commissioner of Commercial Taxes, Chittoor in respect of the aforementioned loans as per which the repayment schedule of the loans have been determined as being repayable at the end of the 14^th year from the month in which these loans were availed. The Management is however of the

view that these loans are repayable at the end of the 14^th year from the year in which these loans were availed in terms of the sanction of these loans by the Government of Andhra Pradesh, Commissionerate of Industries and are accordingly making an yearly repayment of these loans.

Note 30: Exceptional items

On January 30, 2023, a fire broke out at one of the manufacturing facilities of the Company at Chittoor, Andhra Pradesh which caused damage to the Company's property, plant and equipment and inventories. There were no loss of lives. The Company recognised a loss of ? 438.56 crores arising from such incident and the said losses and the corresponding credit arising from the insurance claim receivable were presented on a net basis during the year ended March 31, 2023.

During the year ended March 31, 2025, the Company has received an on-account payment of ? 175 crores from the Insurance Company (March 31, 2024: ? 224.13 crores) towards the insurance claim (including on reinstatement basis for property, plant and equipment) lodged on account of damage to its assets. The Company has also realised ? 11.07 crores (March 31, 2024: ? 100.13 crores) from processing and/or sale of scrap generated from the fire accident.

An amount of ? 111.07 crores representing difference between the cumulative amount received and the insurance claim receivable recognised in books, has been recognised as exceptional item in the Statement of Profit and Loss.

Dues to Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management. This has been relied upon by the auditors.

Note 33: Assets classified as held for sale

Pursuant to approval granted by the Board of Directors at their meeting held on January 25, 2023, the Management entered into a Business Transfer Agreement (BTA), as amended with Amara Raja Advanced Cell Technologies Private Limited ("ARACT”), a wholly-owned subsidiary of the Company for sale/transfer of the New Energy Business of the Company as a going concern on a slump sale basis, for a consideration of ? 223.96 crores representing the net assets sold/transferred on June 1, 2023.

b. Defined benefit plans

The Company provides to the eligible employees defined benefit plans in the form of gratuity. The gratuity plan provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount equivalent to 15 days' salary payable for each completed year of service. Vesting occurs upon completion of five continuous years of service. The measurement date used for determining retirement benefits for gratuity is March 31.

These plans typically expose the Company to actuarial risks such as investment risk, interest rate risk, longevity risk and salary risk.

Risk Management:

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

Interest rate risk - The present value of the defined benefit plan liability is calculated using a discount rate determined by reference to market yields at the end of the reporting period on government bonds. A decrease in yields will increase the fund liabilities and vice-versa.

Longevity risk - The present value of defined benefit plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after employment. An increase in the life expectancy of the plan participants will increase the plan's liability.

Salary risk - The present value of the defined benefit plan is calculated with reference to the future salaries of participants under the plan. Increase in salary due to adverse inflationary pressures might lead to higher liabilities.

The sensitivity analysis above have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the year and may not be representative of the actual change. It is based on a change in the key assumption while holding all other assumptions constant. When calculating the sensitivity to the assumption, the same method used to calculate the liability recognised in the Balance Sheet has been applied. The methods and types of assumptions used in preparing the sensitivity analysis did not change compared with the previous year.

Note 35: Segment reporting

The Company publishes Standalone Financial Statements along with Consolidated Financial Statements. In accordance with Indian Accounting Standard (Ind AS) 108 on Operating segments, the Company has disclosed the segment information in the Consolidated Financial Statements. Accordingly, the segment information is given in the Consolidated Financial Statements of Amara Raja Energy & Mobility Limited and its subsidiaries for the year ended March 31, 2025.

Note 42: Details of Provisions

(a) Provision for warranty is made for estimated warranty claims in respect of sale of certain storage batteries which are still under warranty at the end of the reporting period, the estimated cost of which is accrued at the time of sale. These claims are expected to be settled as and when warranty claims arise. The provision for warranty claims represents the present value of the Management's best estimate of the future outflow of economic benefits that will be required under the Company's obligation for warranties. Management estimates the provision based on historical warranty claim information and may vary as a result of new materials, altered manufacturing processes or other events affecting product quality. The products are generally covered under a free warranty period ranging from 6 months to 42 months.

Note 43: Financial instruments and related disclosures

A. Capital Management

The Company's financial strategy aims to support its strategic priorities and provide adequate capital to its businesses for growth and creation of sustainable stakeholder value. The Company funds its operations through internal accruals. The Company aims at maintaining a strong capital base largely towards supporting the future growth of its businesses as a going concern. The capital structure of the Company is based on Management's judgment of its strategic day-to-day needs with a focus on total equity so as to maintain investor, creditors and market confidence.

The Management and the Board of Directors monitor the return on capital as well as the level of dividends to shareholders. The Company may take appropriate steps in order to maintain, or if necessary, adjust its capital structure.

Equity share capital and other equity are considered for the purpose of Company's Capital Management.

C. Financial risk management objectives

The Company has a system-based approach to risk management, anchored to policies and procedures and internal financial controls aimed at ensuring early identification, evaluation and management of key financial risks (such as market risk, foreign currency risk, credit risk and liquidity risk) that may arise as a consequence of its business operations as well as its investing and financing activities. Accordingly, the Company's risk management framework has the objective of ensuring that such risks are managed within acceptable and approved risk parameters in a disciplined and consistent manner and in compliance with applicable regulation. It also seeks to drive accountability in this regard. The key risks and mitigating actions are overseen by the Board of Directors of the Company.

Liquidity Risk

The Company manages its liquidity risk by ensuring, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due. Also, the Company has unutilised credit limits with banks. The Company maintained a cautious liquidity strategy, with a positive cash balance throughout the year ended March 31, 2025 and March 31, 2024. Cash flow from operating activities provides the funds to service the financial liabilities on a day to day basis.

The Company regularly maintains the rolling forecasts to ensure it has sufficient cash on an on-going basis to meet operational needs. Any short-term surplus cash generated, over and above the amount required for working capital management and other operational requirements, is retained as cash and cash equivalents (to the extent required) and any excess is invested in interest bearing term deposits and mutual funds with appropriate maturities to optimise the cash returns on investments while ensuring sufficient liquidity to meet its liabilities.

The Company's current assets aggregate ? 3,571.36 crores (March 31, 2024 ? 3,549.02 crores) including Current investments, Cash and cash equivalents and Other bank balances of ? 227.76 crores (March 31, 2024 ? 369.44 crores) against an aggregate current liability of ? 2,200.34 crores (March 31, 2024 ? 1,657.92 crores). The table below provides details regarding the contractual maturities of significant non-current financial liabilities as of March 31, 2025 and March 31, 2024. Contractual maturities in respect of lease liabilities has been disclosed in Note 38.

Further, while the Company's total equity stands at ? 7,378.27 crores (March 31, 2024: ? 6,768.65 crores crores), it has borrowings of ? 144.52 crores (March 31, 2024: ? 53.33 crores). In such circumstances, liquidity risk or the risk that the Company may not be able to settle or meet its obligations as they become due does not exist.

Market Risk

The Company continues to hold certain investments in equity for long term value accretion which are accordingly measured at fair value through Other Comprehensive Income. The value of investments in such equity and preference share instruments as at March 31, 2025 is ? 351.90 crores (March 31, 2024 ? 360.57 crores). Accordingly, fair value fluctuations arising from market volatility is recognised in Other Comprehensive Income.

Interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company is primarily not exposed to interest rate risk considering the amount of borrowings availed from banks. Further, treasury activities, focused on managing current investments are administered under a set of approved policies and procedures guided by the tenets of liquidity, safety and returns. This ensures that investments are only made within acceptable risk parameters after due evaluation. The Company invests in Mutual Fund schemes of leading fund houses. Such investments are susceptible to market price risk that arise mainly from changes in interest rate which may impact the return and value of such investments. However, given the relatively short tenure of underlying portfolio of the Mutual Fund schemes in which the Company has invested, such price risk is not significant. Fixed deposits are held with highly rated banks and have a short tenure and are not subject to interest rate volatility.

Commodity Price Risk

Material cost is the largest cost component for the Company, thus exposing it to the risk of price fluctuations based on the supply and demand conditions of those materials. Commodity price risk exposure is evaluated and managed through operating procedures and sourcing policies. The Company has put in place a mix of long-term and short-term mitigation plans. The long-term price view consisted of identifying single vendor dependency and finding alternate vendors and sources for the same. The Company also has a robust process of estimating the prices periodically, analyzing deviations, if any, and taking short-term corrective measures in addition to altering the outlook for the long-term, if required. The Company also leverages its financial resources to modify the inventory levels as required keeping in mind the price outlook in the near term. Similarly, the Company modifies the contract period in negotiations with the vendors to either lock in prices or link them to expected market prices. During the year ended March 31, 2025 and March 31, 2024, the Company had not entered into any derivative contracts to hedge exposure to fluctuations in commodity prices.

Foreign Currency Risk

The Company is subject to the risk that changes in foreign currency values impact the Company's export revenues and import of raw materials and property, plant and equipment. The Company is exposed to foreign exchange risk arising from currency exposures, primarily with respect to US Dollars, EURO and GBP. Financial assets and liabilities denominated in foreign currency, are also subject to reinstatement risk.

The Company manages currency exposures within prescribed limits. The aim of the Company's approach to management of currency risk is to leave the Company with no material residual risk.

Foreign currency sensitivity analysis

For every percentage point increase in the underlying exchange rate of the outstanding foreign currency denominated assets and liabilities, holding all other variables constant, the profit before tax for the year ended March 31, 2025 would change by T 1.24 crores [March 31, 2024: T 1.39 crores]. For every percentage point decrease in the underlying exchange rate would have led to an equal but opposite effect.

The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the year-end for a 1% change in foreign currency rates.

Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counter-party fails to meet its contractual obligation.

Concentration of credit risk with respect to trade receivables are limited, due to Company's customer base being large and diverse. All trade receivables are reviewed and assessed for default on a monthly basis. The Company's historical experience of collecting receivables and the level of default indicate that credit risk is low and generally uniform across markets; consequently, trade receivables are considered to be a single class of financial assets. All overdue customer balances are evaluated taking into account the age of the dues, specific credit circumstances, the track record of the counterparty etc. loss allowances and impairment is recognised, where considered appropriate by responsible management.

The credit risk on cash and bank balances and fixed deposits is limited because the counterparties are banks with high credit ratings.

D. Fair value measurement Fair value hierarchy

The fair value of financial instruments as referred to in Note 43.B above have been classified into three categories depending on the inputs used in the valuation technique. The hierarchy gives the highest priority to quoted prices in active markets for identified assets or liabilities [Level 1 measurements] and lowest priority to unobservable inputs [Level 3 measurements]

The following levels have been used for classification:

• Level 1: Quoted prices (unadjusted) for identical instruments in active market.

• Level 2: Directly or indirectly observable market inputs, other than Level 1 inputs

• Level 3: Inputs which are not based on observable market data.

If one or more of the significant inputs is not based on observable market data, the fair value is determined using generally accepted pricing models based on a discounted cash flow analysis, with the most significant inputs being the discount rate that reflects the credit risk of counterparty.

The fair value of trade receivables, trade payables and other current financial assets and liabilities is considered to be equal to the carrying amounts of these items due to their short-term nature. Where such items are non-current in nature, the same has been classified as Level 3 and fair value determined using discounted cash flow basis. Similarly for certain unquoted equity instruments where most recent information to measure fair value is insufficient, or if there is a wide range of possible fair value measurements, cost has been considered as the best estimate of fair value.

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 amounts would be significantly different from the values that would eventually be received or settled.

There has been no change in the valuation methodology for Level 3 inputs during the year. The Company has classified certain unquoted equity instruments under Level 3 of the fair value hierarchy. There were no transfers between Level 1 and Level 2 during the year.

Notes:

(i) The performance of investments in unquoted shares of Andhra Pradesh Gas Power Corporation Limited along with the relevant economic and market indicators, supply chain challenges and closure of power plants resulted in diminution in the fair value of the investment. Accordingly, the Company had determined the fair value of the Investment as T Nil in the previous years and recorded the resultant change in fair value in other comprehensive income. There has been no change in these factors during the current year.

(ii) During the year, the Company, based on a valuation carried out and available market information, has determined the fair value of its investment in the equity and preference shares of Log 9 Materials Scientific Private Limited ('Log 9') at T Nil, owing to the business of Log 9 facing challenges of unfavourable economic conditions, operational disruptions and financial distress. Other comprehensive loss includes the resultant fair value change of T 225.61 crores (net of tax T 35.00 crores).

(iii) During the year, the Company as part of its strategic initiatives has made an additional investment of T 178.94 crores in Inobat AS ('Inobat'). The investment was recorded at transaction cost and irrevocably designated at fair value through other comprehensive income ('FVTOCI'). No fair value change was recorded as at March 31, 2025 considering that another investment by an unrelated party in Inobat closer to March 31, 2025 was made at the same rate as that of the aforesaid additional investment.

Additionally, as at March 31, 2025, the initial investment made in earlier years, also designated at FVTOCI was fair valued using the transaction rate at which the additional investment was made during the year. The resultant fair value gain of T 62.50 crores (net of tax T 10.43 crores) was recorded in the other comprehensive income.

Interim dividend of T 5.30 per equity share of face value of T 1 each approved by the Board of Directors at its meeting held on November 04, 2024 was paid during the current year. The Board of Directors at its meeting held on May 29, 2025 has recommended a dividend of T 5.20 per equity share of face value of T 1 each which is subject to approval of the shareholders at the ensuing Annual General Meeting of the Company and hence is not recognised as a liability. The total dividend (including interim dividend) for FY 2024-25 amounts to T 10.50 per equity share (Previous year T 9.90 per equity share).

Note 47: Business combination

The Board of Directors of the Company at its meeting held on September 26, 2022 approved a Scheme of Arrangement amongst Mangal Industries Limited ('Demerged Company') and Amara Raja Energy & Mobility Limited (formerly known as Amara Raja Batteries Limited) ['the Company'] and their respective shareholders and creditors, under the provisions of Section 230 to 232 and other applicable provisions of the Companies Act, 2013 ("the Scheme"). The Scheme, inter-alia, provides for demerger of the plastic component for battery business ('Demerged Undertaking') from the demerged company to the Company. The Scheme has been approved by the Hon'ble jurisdictional National Company Law Tribunal ('NCLT') vide its order dated January 10, 2024, and the same has become effective from February 1, 2024.

The Demerged Company is engaged in various businesses such as Plastic Component for Battery Business, manufacturing of auto components (including fasteners, plastics, copper inserts /connectors and others), metal fabrication, storage solution, lead bushes and trading of various products, etc. The entire output generated from the Plastic Component for Battery Business is currently sold to the Company. This backward integration is expected to enhance the Company's control over the supply and inventory management of its raw materials. This would help with a unified approach on supply chain management and consequent synergies leading to optimization of resource utilisation, reduced operational, logistics, supervisory and overhead / utilities costs, reduce duplication of administrative efforts and better procurement policies and prices, for the Resulting Company.

"The Company had given effect to the Scheme in accordance with the MCA's General Circular 9/2019 dated August 21, 2019 from April 1, 2022 being the appointed date as per the Scheme and the previously issued standalone financial statements for the year ended March 31, 2023 were restated.

The excess of the purchase consideration paid aggregating T 672.56 crores over the fair value of assets acquired of T 244.57 crores has been attributed to goodwill of T 427.99 crores. The primary items that generated this goodwill are the value of the acquired assembled workforce and estimated synergies, neither of which qualify as an intangible asset. And acquisition results in enhanced control over the supply and inventory management of its raw materials. This would help with a unified approach on supply chain management and consequent synergies leading to optimization of resource utilisation, reduced operational, logistics, supervisory and overhead / utilities costs, reduce duplication of administrative efforts and better procurement policies and prices. Goodwill is not tax-deductible.

Note 48:

The Company had entered into a Share Purchase Agreement with RNGalla Family Private Limited (promoter of the Company) to purchase entire shareholding in Amara Raja Power Systems Limited (""ARPSL""), an entity primarily engaged in the manufacture of industrial chargers, integrated power systems, EV chargers for 2W and 3W applications and other energy management devices for a consideration of T 133 crores. The transaction was concluded on September 29, 2023.

Note 49:

The Company on April 30, 2021 received closure orders from the Andhra Pradesh Pollution Control Board ('APPCB') for the Company's plants situated at Karakambadi, Tirupati and Nunegundlapalli Village, Chittoor District. Consequently, the Company went in appeal against the said orders to the Hon'ble High Court of Andhra Pradesh at Amravati, which granted interim suspension of the closure orders. The plants of the Company were closed for a period of 5 days during the quarter ended June 30, 2021, from the date of closure orders till the date of the said interim suspension. The Company did not incur any material loss during the period of closure.

APPCB also issued two show cause notices in February, 2022 against which the Company filed a special leave petition with the Hon'ble Supreme Court which vide its order dated February 20, 2023 disposed off the matter for it to be heard at the lower courts and the same is pending disposal.

The Management has also been working with the APPCB to satisfactorily resolve the matter.

Note 50:

The Code on Social Security, 2020 ('Code') relating to employee benefits during employment and post employment benefits has been enacted. However, the date on which the Code will come into effect has not yet been notified. The Management will complete its evaluation and will give appropriate impact in its financial statements in the period in which the Code becomes effective.

Note 51: The standalone financial statements are approved for issue by the Audit Committee and Board of Directors at their meetings held on May 29, 2025.