Notes to Accounts of HP Telecom India Ltd.

Mar 31, 2026

2.16 Provision, Contingent Liabilities and Contingent Assets:

Provisions involving substantial degree of estimation in measurement are recognised when there is a present
obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities
are not recognised but are disclosed in notes. Contingent Assets are neither recognised nor disclosed in the Financial
Statements.

The Original Equipment Manufacturer (“OEM”) provides standard assurance-type warranties on all products distributed
by the Company, covering product performance and quality under the OEM''s terms and conditions. The Company
does not assume any separate or additional warranty obligations beyond those provided by the OEM. Based on
historical experience and the contractual allocation of warranty risk to the OEM, management has determined that no
liability for warranty claims is expected to arise and, accordingly, no provision for warranties or related claims is
required.

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed only by the
occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present
obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the
obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized
because it cannot be measured reliably; the Company does not recognize a contingent liability but discloses its
existence in the Financial Statements.

Contingent assets are neither recognized nor disclosed in the Financial Statements.

2.17 Foreign currency transactions:

Transactions denominated in foreign currencies are initially recorded and accounted for at the exchange rates
prevailing on the date of the respective transactions.

Monetary assets and liabilities (such as cash, receivables, and payables) denominated in foreign currencies that are
outstanding as at the balance sheet date are translated into Indian Rupees using the closing exchange rates prevailing
on that date.

Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using
the exchange rate at the date of the initial transaction. Non-monetary items which are carried at fair value or other
similar valuation denominated in a foreign currency are translated using the exchange rates at the date when such
value was determined.

Exchange differences arising on the settlement of monetary items or on the translation of monetary items at rates
different from those at which they were initially recorded during the year, or reported in previous financial statements,
are recognized as income or as an expense in the Statement of Profit and Loss in the period in which they arise.

2.18 Impairment of Assets:

The Company assess at each reporting date as to whether there is any indication that an asset (tangible and
intangible) may be impaired. An asset is treated as impaired, when the carrying cost of the asset exceeds its
recoverable amount. Recoverable amount is higher of an asset''s or cash generating unit''s net selling price and its
value in use. Value in use is the present value of estimated future cash flows expected to arise from the continuing use
of an asset and from its disposal at the end of its useful life. An impairment loss is charged to the Statement of Profit
and Loss in the year in which an asset is identified as impaired. The impairment loss recognised in prior accounting
period is reversed if there has been a change in the estimate of recoverable amount.

Primary Security: Sole & Exclusive charge over entire existing and future current assets of the Company including raw materials,
stock-in-process, finished goods, Stores and Spares, Bill receivables, Book debts and other current assets of the Company.
Collateral Security:

1) All the piece and parcel of the immovable property being Resident Flat No. I-204, admeasuring about 1286.00 sq. feets i.e. 119.51
sq. mtrs., built up area, along with of undivided share in land admeasuring about 10.00 sq. mtrs. lying and located on the Second
Floor of the "I" building known "PRAMUKH HILLS", Constructed on N.A. land bearing Survey no. 43/1, admeasuring about 16188.00
sq. mtrs., Situated within the Jurisdiction of Chharwada Gram Panchayat, Taluka: Vapi, Dist: Valsad, State: Gujarat. Owned by Smt.
Seema Vijay Yadav.

2) All that piece and parcel of a non-agriculture land bearing Plot No. 002, admeasuring 2841.00 sq. mtrs. (Computerized Survey No
846/2, admeasuring H. 0-28-Are-41 Sq. Mtrs. and Promulgation New Survey No. 5085, Akar 710.30), Consisting Revenue Survey
no. 846, totally admeasuring 3,15,401.00 sq. mtrs. situated at Village: Vapi, Taluka: Vapi, Dist: Valsad, State Gujarat, together with
all other rights, title, interest and benefits thereto. Owned by 1. Shri Vijay Lalsingh Yadav, 2. Smt. Seema Vijay Yadav, 3. Shri
Bharatlal Lalsingh Singh, 4. Smt. Sangita Bharatlal Yadav.

3) All the piece and parcel of Plot No. 7 of the society known as "MEGHNA ROW HOUSE" situated at B/H Maharaja Agrasen
Bhavan, City Light Road bearing Revenue Survey no. 164, T.P. Scheme No. 4 (Umra South) Final Plot no. 93 of Village Umra,
Taluka: Majura (Surat City), Dist: Surat total admeasuring about 116.90 sq mtrs. along with construction thereon and undivided
share in land. Owned by Shri Vijay Lalsingh Yadav.

4) All the piece and parcel of plot no. 8 of the society known as "MEGHNA ROW HOUSE" situated at B/H Maharaja Agrasen
Bhavan, City Light Road bearing Revenue Survey no. 164, T.P. Scheme No. 4 (Umra South) Final Plot no. 93 of Village Umra,
Taluka: Majura (Surat City), Dist: Surat total admeasuring about 116.23 sq mtrs. along with construction thereon and undivided
share in land. Owned by Shri Vijay Lalsingh Yadav.

5) Cash Collateral:

a. Investment in Mutual Funds of Rs.9.07 crs (face Value) in the Name of M/s HP Telecom India Pvt Ltd. (now HP Telecom India
Ltd)

b. Investment in Cash Collateral of Rs.0.60 crs in addition to the existing Investment kept as security with the Bank.

c. Cash collateral of Rs. 0.50 crs in the form of Bank Deposit.

Personal Guarantor: Mr. Vijay Lalsingh Yadav, Mrs. Seema Vijay Yadav, Mr. Bharatlal Lalsingh Yadav and Mrs. Sangita Bharatlal
Yadav

i. The Company has not entered into any long-term lease arrangements during the reporting period in accordance with AS-
19. Accordingly, disclosures relating to long-term lease commitments are not applicable and hence have not been
presented in these financial statements.

j. The Company operates in a single business segment and accordingly, segment reporting requirements under AS-17 are
not applicable to the Company.

b. The Company does not have any benami property, where any proceeding has been initiated or pending against the
Company for holding any Benami Property.

c. The Company does not have any transactions with companies struck off.

d. The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory
period.

e. The Company have not traded or invest in Crypto currency or Virtual currency during the financial year.

f. The Company have not advanced or loaned or invested funds (either borrowed funds or share premium or any other
sources or kind of funds) to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the
understanding (whether recorded in writing or otherwise) that the Intermediary shall:

(i) 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

(ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

g. The Company have 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:

(i) 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

(ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

h. The Company does not have any such transaction which is not recorded in the books of accounts that has been
surrendered or disclosed as income during the year in the tax assessment under the Income Tax Act, 1961 (such as,
search or survey or any other relevant provisions of the Income Tax Act, 1961).

i. The Company has not been declared as Wilful defaulter by the Banks, Financial institution or other lenders.

j. The Company has not granted any loans or advances in the nature of loans to promoters, directors, key managerial
personnel or related parties (as defined under the Companies Act, 2013), either severally or jointly with any other person,
which are repayable on demand or without specifying any terms or period of repayment.

k. the Company has not revalued its Property, Plant and Equipment (including Right of Use assets) or intangible assets or
both during the year.

l. the Company has complied with the number of layers prescribed under clause (87) of section 2 of the Companies Act,
2013 read with Companies (Restriction on number of Layers) Rules, 2017.

m. The Company has not entered into any scheme of arrangement which has an accounting impact on the current and
previous financial year.

n. Details related to borrowings from banks or financial institutions on the basis of security of current assets:

The Company has been sanctioned working capital facilities by Axis Bank and State Bank of India against the security of
current assets. We confirm that the Company has submitted the required quarterly returns and statements, including stock
statements, invoice due statements, ageing analysis of invoice due, and other financial information, to the respective
banks in accordance with the stipulated terms of sanction.

To the best of our knowledge and belief, and based on the records maintained, the said quarterly returns and statements
submitted to the banks are in agreement with the unaudited books of account for the respective quarters and with the
audited financial statements for the financial year ended March 31,2026.

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Mar 31, 2025

(iii) Shares allotted for consideration other than cash (for period of five years preceding the balance sheet date)

Issue of Bonus Equity Shares:

Pursuant to the approval of the shareholders vide resolution passed on January 16, 2024, the Company has allotted bonus equity shares in the ratio of 1:2, i.e., 1 new equity share for every 2 equity shares held, by capitalizing a sum from the Company''s free reserves. The allotment of bonus equity shares was made on January 22, 2024.

(iv) calls unpaid (showing aggregate value of calls unpaid by directors and officers):

By Directors -

By Officers -

(v) Terms/rights attached to shares:

The Equity shares have a face value of Rs 10 per share. Each holder of share is entitled to one vote per share. In the event of liquidation of company all shareholders will be entitled to receive remaining assets of the company after distribution of all preferential amounts in proportion to the shares held by them.

Terms & Conditions, Securities, Repayment Terms and Interest Rate on Inventory Funding Facilities borrowed from Axis Bank are as follows:

Sanction Limit: Inventory funding - 1 Rs. 34.50 Crore & Inventory funding - 2 Rs. 65.00 Crore Facility Tenor: 12 Months (Repayable on demand)

Interest Rate: For Inventory Funding Facilities - 1 & 2, Repo 3.60% p.a.

Securities: The facilities are secured as follows -

• Primary: Hypothecation of entire current assets of borrower, both present and future. (Ranking: First Pari Passu basis with SBI Bank)

• Collateral: FDR equivalent to 28.50% on overall exposure with bank''s lien noted thereon

• Personal Guarantors: Vijay Lalsingh Yadav, Seemaben Vijay Yadav, Bharat Lalsingh Yadav and Sangita Bharat Yadav

Terms & Conditions, Securities, Repayment Terms and Interest Rate on Fund Based and Non-Fund Based Facilities borrowed from SBI Bank are as follows:

Sanction Limit: The Company has been sanctioned the following working capital facilities -

• Fund Based Working Capital (FBWC) Limit: ?75.00 Crore

• Non-Fund Based Limits (as sub-limits of the FBWC):

- Letter of Credit (LC): ?6.00 Crore

- Bank Guarantee (BG): ?4.00 Crore

Facility Tenor: GECL loan of Rs. 4.45 crore repayable in 36 equal monthly instalments after a moratorium of 12 months from date of disbursement. Working Capital Loan: Repayable on demand

Rate of Interest:

-Working Capital Loan: MCLR 1.50% p.a.

- GECL: MCLR 0.70% p.a.

Primary Security: Sole & Exclusive charge over entire existing and future current assets of the Company including raw materials, stock-inprocess, finished goods, Stores and Spares, Bill receivables, Book debts and other current assets of the Company.

Collateral Security:

1) All the piece and parcel of the immovable property being Resident Flat No. I-204, admeasuring about 1286.00 sq. feets i.e. 119.51 sq. mtrs., built up area, along with of undivided share in land admeasuring about 10.00 sq. mtrs. lying and located on the Second Floor of the "I" building known "PRAMUKH HILLS", Constructed on N.A. land bearing Survey no. 43/1, admeasuring about 16188.00 sq. mtrs., Situated within the Jurisdiction of Chharwada Gram Panchayat, Taluka: Vapi, Dist: Valsad, State: Gujarat. Owned by Smt. Seema Vijay Yadav.

2) All that piece and parcel of a non-agriculture land bearing Plot No. 002, admeasuring 2841.00 sq. mtrs. (Computerized Survey No. 846/2, admeasuring H. 0-28-Are-41 Sq. Mtrs. and Promulgation New Survey No. 5085, Akar 710.30), Consisting Revenue Survey no. 846, totally admeasuring 3,15,401.00 sq. mtrs. situated at Village: Vapi, Taluka: Vapi, Dist: Valsad, State Gujarat, together with all other rights, title, interest and benefits thereto. Owned by 1. Shri Vijay Lalsingh Yadav, 2. Smt. Seema Vijay Yadav, 3. Shri Bharatlal Lalsingh Singh, 4. Smt. Sangita Bharatlal Yadav.

3) All the piece and parcel of Plot No. 7 of the society known as "MEGHNA ROW HOUSE" situated at B/H Maharaja Agrasen Bhavan, City Light Road bearing Revenue Survey no. 164, T.P. Scheme No. 4 (Umra South) Final Plot no. 93 of Village Umra, Taluka: Majura (Surat City), Dist: Surat total admeasuring about 116.90 sq mtrs. along with construction thereon and undivided share in land. Owned by Shri Vijay Lalsingh Yadav.

4) All the piece and parcel of plot no. 8 of the society known as "MEGHNA ROW HOUSE" situated at B/H Maharaja Agrasen Bhavan, City Light Road bearing Revenue Survey no. 164, T.P. Scheme No. 4 (Umra South) Final Plot no. 93 of Village Umra, Taluka: Majura (Surat City), Dist: Surat total admeasuring about 116.23 sq mtrs. along with construction thereon and undivided share in land. Owned by Shri Vijay Lalsingh Yadav.

5) Cash Collateral:

a. Investment in Mutual Funds of Rs.9.07 crs (face Value) in the Name of M/s HP Telecom India Pvt Ltd. (now HP Telecom India Ltd)

b. Investment in Cash Collateral of Rs.0.60 crs in addition to the existing Investment kept as security with the Bank.

c. Cash collateral of Rs. 0.50 crs in the form of Bank Deposit.

Personal Guarantor: Mr. Vijay Lalsingh Yadav, Mrs. Seema Vijay Yadav, Mr. Bharatlal Lalsingh Yadav and Mrs. Sangita Bharatlal Yadav

Litigations:

The Company was selected for faceless assessment for AY 2022-23 via DIN and Letter No. ITBA/AST/S/61/2023-24/1053412841(1) dated June 1, 2023. The proceedings were concluded on March 21, 2024. The order was passed with a demand of Rs. 94,050/-, which has been duly accepted with no intention to appeal and paid by the company on March 29, 2024. However, the demand still seems due on the Income Tax Portal. The Management of the Company is following up with its jurisdictional assessing officer to get the same cleared.

i. The Company does not have lease liability and hence no reporting related to the same has been made.

b. The Company does not have any benami property, where any proceeding has been initiated or pending against the Company for holding any Benami Property.

c. The Company does not have any transactions with companies struck off.

d. The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.

e. The Company have not traded or invest in Crypto currency or Virtual currency during the financial year.

f. The Company have not advanced or loaned or invested funds (either borrowed funds or share premium or any other sources or kind

of funds) to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding (whether recorded in writing or otherwise) that the Intermediary shall:

(i) 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

(ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

g. The Company have 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:

(i) 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

(ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

h. The Company does not have any such transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessment under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961)

i. The Company has not been declared as Wilful defaulter by the Banks, Financial institution or other lenders.

j. No Loans & Advances in the nature of Loans are granted to promoters, Directors, KMP, and other related party as per Companies Act 2013.

k. the Company has not revalued its Property, Plant and Equipment (including Right of Use assets) or intangible assets or both during the year.

l. the Company has complied with the number of layers prescribed under clause (87) of section 2 of the Companies Act, 2013 read with Companies (Restriction on number of Layers) Rules, 2017.

m. Details related to borrowings from banks or financial institutions on the basis of security of current assets:

The Company has been sanctioned working capital facilities by Axis Bank and State Bank of India against the security of current assets. We confirm that the Company has submitted the required quarterly returns and statements, including stock statements, invoice due statements, ageing analysis of invoice due, and other financial information, to the respective banks in accordance with the stipulated terms of sanction.

To the best of our knowledge and belief, and based on the records maintained, the said quarterly returns and statements submitted to the banks are in agreement with the unaudited books of account for the respective quarters and with the audited financial statements for the financial year ended March 31,2025.

Explanation for variances exceeding 25%

1 The Company’s debt-equity ratio has decreased during the financial year due to an increase in equity base on account of additional share capital infused through IPO and profits earned during the year.

2 The Debt Service Coverage Ratio has increased due to increase in EBITDA.

3 The Return on Equity has decreased during the year primarily due to an increase in shareholders’ funds, resulting from capital infusion and retained earnings from current year profits. While the Company continues to generate healthy earnings, the expanded equity base has led to a proportionate reduction in the ROE ratio.

4 The Net Capital Turnover Ratio has decreased during the year, primarily due to a reduction in trade payables as compared to the previous year.

5 The Return on Capital Employed has declined during the financial year, primarily due to an increase in capital employed.

6 The changes observed in certain previous year’s ratios as compared to the previous year are partly attributable to regrouping and reclassification of the previous year’s figures, wherever necessary, to align with the current year’s presentation. These changes have been made for better comparability and do not materially affect the overall financial analysis.