Notes to Accounts of Esab India Ltd.

Mar 31, 2025

l. Provisions

Provisions are recognised when the Company
has a present obligation (legal or constructive)
as a result of a past event and it is probable that
an outflow of resources embodying economic
benefits will be required to settle the obligation
and a reliable estimate can be made of the
amount of the obligation. The expense relating
to a provision is presented in the statement of
profit and loss net of any reimbursement.
Provisions are determined based on the best
estimate required to settle the obligation at the
balance sheet date and measured using the
present value of cash flows estimated to settle
the present obligations (when the effect of time
value of money is material). These are reviewed
at each balance sheet date and adjusted to
reflect the current best estimates. When
discounting is used, the increase in the provision
due to the passage of time is recognised as a
finance cost.

m. Contingent liabilities

A contingent liability is a possible obligation that
arises from past events whose existence will be
confirmed 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 or the amount of
the obligation cannot be measured with sufficient
reliability. The Company does not recognize a
contingent liability but discloses its existence in
the financial statements, contigent assets are
only disclosed when it is probable that has
economic benefits will flow to the entity.

n. Financial instruments

A financial instrument is any contract that gives
rise to a financial asset of one entity and a
financial liability or equity instrument of another
entity.

Financial assets and financial liabilities are
recognised when the Company becomes a party
to the contractual provisions of the financial
instruments.

i. Financial Assets

All regular way purchases or sales of financial
assets are recognised and derecognised on a
trade date basis. Regular way purchases or sales
are purchases or sales of financial assets that
require delivery of assets within the time frame
established by regulation or convention in the
marketplace.

All recognised financial assets are subsequently
measured in their entierly at either amortised cost
or fair value, depending on the classification of
the financial assets.

Classification of financial assets:

Debt instruments that meet the following
conditions are subsequently measured at
amortised cost (except for debt instruments that
are designated as at fair value through profit or
loss on initial recognition):

• the asset is held within a business model
whose objective is to hold assets in order
to collect contractual cash flows; and

• the contractual terms of the instrument give
rise on specified dates to cash flows that
are solely payments of principal and interest
on the principal amount outstanding.

Debt instruments that meet the following
conditions are subsequently measured at fair
value through other comprehensive income
(except for debt instruments that are designated
as at fair value through profit or loss on initial
recognition):

the asset is held within a business model whose
objective is achieved both by collecting
contractual cash flows and selling financial
assets; and the contractual terms of the
instrument give rise on specified dates to cash
flows that are solely payments of principal and
interest on the principal amount outstanding.

By default, all other financial assets are
measured subsequently at fair value through
profit or loss (FVTPL).

Despite the foregoing, the Company may make
the following irrevocable election / designation
at initial recognition of a financial asset:

• the Company may irrevocably elect to
present subsequent changes in fair value
of an equity investment in other
comprehensive income if certain criteria are
met (see (iii) below); and

• the Company may irrevocably designate a
debt investment that meets the amortised
cost or FVTOCI criteria as measured at
FVTPL if doing so eliminates or significantly
reduces an accounting mismatch (see (iv)
below).All other financial assets are
subsequently measured at fair value."

(i) Amortised cost and effective interest
method:

The effective interest method is a method of
calculating the amortised cost of a debt
instrument and of allocating interest income over
the relevant period.

For financial assets other than purchased or
originated credit-impaired financial assets (i.e.
assets that are credit-impaired on initial
recognition), the effective interest rate is the rate
that exactly discounts estimated future cash
receipts (including all fees and points paid or
received that form an integral part of the effective
interest rate, transaction costs and other
premiums or discounts) excluding expected credit
losses, through the expected life of the debt
instrument, or, where appropriate, a shorter
period, to the gross carrying amount of the debt
instrument on initial recognition. For purchased
or originated credit-impaired financial assets, a
credit-adjusted effective interest rate is calculated
by discounting the estimated future cash flows,
including expected credit losses, to the amortised
cost of the debt instrument on initial recognition.

The amortised cost of a financial asset is the
amount at which the financial asset is measured
at initial recognition minus the principal
repayments, plus the cumulative amortisation
using the effective interest method of any
difference between that initial amount and the
maturity amount, adjusted for any loss allowance.
The gross carrying amount of a financial asset is
the amortised cost of a financial asset before
adjusting for any loss allowance.

Interest income is recognised using the effective
interest method for debt instruments measured
subsequently at amortised cost and at FVTOCI.
For financial assets other than purchased or
originated credit-impaired financial assets,
interest income is calculated by applying the
effective interest rate to the gross carrying
amount of a financial asset, except for financial
assets that have subsequently become credit-
impaired (see below). For financial assets that
have subsequently become credit-impaired,
interest income is recognised by applying the
effective interest rate to the amortised cost of the

financial asset. If, in subsequent reporting
periods, the credit risk on the credit-impaired
financial instrument improves so that the financial
asset is no longer credit-impaired, interest
income is recognised by applying the effective
interest rate to the gross carrying amount of the
financial asset.

For purchased or originated credit-impaired
financial assets, the Company recognises
interest income by applying the credit-adjusted
effective interest rate to the amortised cost of
the financial asset from initial recognition. The
calculation does not revert to the gross basis
even if the credit risk of the financial asset
subsequently improves so that the financial asset
is no longer credit-impaired.

Interest income is recognised in profit or loss and
is included in the ''Other income'' line item.

(ii) Debt instruments classified as at FVTOCI:

The debt instruments are initially measured at
fair value plus transaction costs.

Subsequently, changes in the carrying amount of
these debt instruments as a result of foreign
exchange gains and losses (see below),
impairment gains or losses (see below), and
interest income calculated using the effective
interest method (see (i) above) are recognised in
profit or loss. The amounts that are recognised in
profit or loss are the same as the amounts that
would have been recognised in profit or loss if
these debt instruments had been measured at
amortised cost. All other changes in the carrying
amount of these debt instruments are recognised
in other comprehensive income and accumulated
in a separate component of equity. When these
debt instruments are derecognised, the
cumulative gains or losses previously recognised
in other comprehensive income are reclassified
to profit or loss.

Equity instruments designated as at FVTOCI:

On initial recognition, the Company may make
an irrevocable election (on an instrument-by¬
instrument basis) to designate investments in
equity instruments as at FVTOCI. Designation
at FVTOCI is not permitted if the equity
investment is held for trading:

Investments in equity instruments at FVTOCI are
initially measured at fair value plus transaction
costs.

Subsequently, they are measured at fair value
with gains and losses arising from changes in
fair value recognized in other comprehensive

income and accumulated in a separate
component of equity. The cumulative gain or loss
is not reclassified to profit or loss on disposal of
the equity investments, instead, it is transferred
to retained earnings.

Dividends on these investments in equity
instruments are recognised in profit or loss in
accordance with Ind AS 109, unless the
dividends clearly represent a recovery of part of
the cost of the investment. Dividends are
included in the ''Other income'' line item in profit
or loss.

The Company designates all investments in
equity instruments that are not held for trading
as at FVTOCI on initial recognition.

A financial asset is held for trading if:

• It has been acquired principally for the
purpose of selling it in the near term; or

• On initial recognition it is part of a portfolio
of identified financial instruments that the
Company manages together and has a
recent actual pattern of short-term profit¬
taking;

(iv) Financial assets at fair value through
profit or loss (FVTPL):

Financial assets that do not meet the criteria for
being measured at amortised cost or FVTOCI
(see (i) to (iii) above) are measured at FVTPL.
Specifically:

• Investments in equity instruments are
classified as at FVTPL, unless the
Company designates an equity investment
that is neither held for trading (see (iii)
above).

• Debt instruments that do not meet the
amortised cost criteria or the FVTOCI
criteria (see (i) and (ii) above) are classified
as at FVTPL. In addition, debt instruments
that meet either the amortised cost criteria
or the FVTOCI criteria may be designated
as at FVTPL upon initial recognition if such
designation eliminates or significantly
reduces a measurement or recognition
inconsistency (so called ''accounting
mismatch'') that would arise from measuring
assets or liabilities or recognising the gains
and losses on them on different bases. The
Company has not designated any debt
instruments as at FVTPL.

Financial assets at FVTPL are measured at fair
value at the end of each reporting period, with
any fair value gains or losses recognised in profit
or loss. The net gain or loss recognised in profit

or loss includes any dividend or interest earned
on the financial asset and is included in the ''other
income'' line item.

Foreign exchange gains and losses:

The carrying amount of financial assets that are
denominated in a foreign currency is determined
in that foreign currency and translated at the spot
rate at the end of each reporting period.
Specifically:

• for financial assets measured at amortised
cost that are not part of a designated
hedging relationship, exchange differences
are recognised in profit or loss in the ''other
income'' line item ;

• for debt instruments measured at FVTOCI
that are not part of a designated hedging
relationship, exchange differences on the
amortised cost of the debt instrument are
recognised in profit or loss in the ''other
income'' line item. As the foreign currency
element recognised in profit or loss is the
same as if it was measured at amortised
cost, the residual foreign currency element
based on the translation of the carrying
amount (at fair value) is recognised in other
comprehensive income in a separate
component of equity;

• for financial assets measured at FVTPL that
are not part of a designated hedging
relationship, exchange differences are
recognised in profit or loss in the ''other
income'' line item as part of the fair value
gain or loss; and

• for equity instruments measured at
FVTOCI, exchange differences are
recognised in other comprehensive income
in a separate component of equity.

Impairment of financial assets:

The Company recognises a loss allowance for
expected credit losses on investments in debt
instruments that are measured at amortised cost
or at FVTOCI, lease receivables, trade receivables
and contract assets, financial guarantee contracts,
and certain other financial assets measured at
amortised cost such as deferred consideration
receivable on disposal of subsidiaries. The amount
of expected credit losses is updated at each
reporting date to reflect changes in credit risk since
initial recognition of the respective financial
instrument.

Expected credit losses are the weighted average
of credit losses with the respective risks of default
occurring as the weights. Credit loss is the

difference between all contractual cash flows that
are due to the Company in accordance with the
contract and all the cash flows that the Company
expects to receive (i.e. all cash shortfalls),
discounted at the original effective interest rate (or
credit-adjusted effective interest rate for purchased
or originated credit-impaired financial assets). The
Company estimates cash flows by considering all
contractual terms of the financial instrument (for
example, prepayment, extension, call and similar
options) through the expected life of that financial
instrument.

The Company measures the loss allowance for
a financial instrument at an amount equal to the
lifetime expected credit losses if the credit risk
on that financial instrument has increased
significantly since initial recognition. If the credit
risk on a financial instrument has not increased
significantly since initial recognition, the
Company measures the loss allowance for that
financial instrument at an amount equal to 12-
month expected credit losses. 12-month
expected credit losses are portion of the life-time
expected credit losses and represent the lifetime
cash shortfalls that will result if default occurs
within the 12 months after the reporting date and
thus, are not cash shortfalls that are predicted
over the next 12 months. For trade receivables,
the Company always measures the loss
allowance at an amount equal to lifetime
expected credit losses.

Further, for the purpose of measuring lifetime
expected credit loss allowance for trade
receivables, the Company has used a practical
expedient method as permitted under Ind AS
109. This expected credit loss allowance is
computed based on a provision matrix which
takes into account historical credit loss
experience and adjusted for forward-looking
information.

De-recognition of financial assets:

The Company derecognises a financial asset
only when the contractual rights to the cash flows
from the asset expire, or when it transfers the
financial asset and substantially all the risks and
rewards of ownership of the asset to another
entity. If the Company neither transfers nor
retains substantially all the risks and rewards of
ownership and continues to control the
transferred asset, the Company recognises its
retained interest in the asset and an associated
liability for amounts it may have to pay. If the
Company retains substantially all the risks and
rewards of ownership of a transferred financial
asset, the Company continues to recognise the

financial asset and also recognises a
collateralized borrowing for the proceeds
received.

On derecognition of a financial asset measured
at amortised cost, the difference between the
asset''s carrying amount and the sum of the
consideration received and receivable is
recognised in profit or loss. In addition, on
derecognition of an investment in a debt
instrument classified as at FVTOCI, the
cumulative gain or loss previously accumulated
in a separate component of equity is reclassified
to profit or loss. In contrast, on derecognition of
an investment in an equity instrument which the
Company has elected on initial recognition to
measure at FVTOCI, the cumulative gain or loss
previously accumulated in a separate component
of equity is not reclassified to profit or loss, but is
transferred to retained earnings."

Financial liabilities and equity instruments
Classification as debt or equity:

Debt and equity instruments issued by the
Company are classified as either financial
liabilities or as equity in accordance with the
substance of the contractual arrangements and
the definitions of a financial liability and an equity
instrument.

Equity instruments:

An equity instrument is any contract that
evidences a residual interest in the assets of an
entity after deducting all of its liabilities. Equity
instruments issued by the Company are
recognised at the proceeds received, net of direct
issue costs. Repurchase of the Company''s own
equity instruments is recognised and deducted
directly in equity. No gain or loss is recognised
in profit or loss on the purchase, sale, issue or
cancellation of the Company''s own equity
instruments.

All financial liabilities are measured subsequently
at amortised cost using the effective interest
method or at FVTPL.

However, financial liabilities that arise when a
transfer of a financial asset does not qualify for
derecognition or when the continuing
involvement approach applies, and financial
guarantee contracts issued by the Company, are
measured in accordance with the specific
accounting policies set out below.

Financial Liabilities at FVTPL:

Financial liabilities are classified as at FVTPL
when the financial liability is (i) held for trading
or (ii) it is designated as at FVTPL.

A financial liability is classified as held for trading
if:

• it has been acquired principally for the
purpose of repurchasing it in the near term;
or

• on initial recognition it is part of a portfolio
of identified financial instruments that the
Company manages together and has a
recent actual pattern of short-term profit¬
taking.

A financial liability other than a financial liability
held for trading may be designated as at FVTPL
upon initial recognition if:

• such designation eliminates or significantly
reduces a measurement or recognition
inconsistency that would otherwise arise;

• or the financial liability forms part of a group
of financial assets or financial liabilities or
both, which is managed and its
performance is evaluated on a fair value
basis, in accordance with the Company''s
documented risk management or
investment strategy, and information about
the grouping is provided internally on that
basis;

Financial liabilities at FVTPL are measured at
fair value, with any gains or losses arising on
changes in fair value recognised in profit or loss
The net gain or loss recognised in profit or loss
incorporates any interest paid on the financial
liability and is included in the ''other income'' line
item in profit or loss.

However, for financial liabilities that are
designated as at FVTPL, the amount of change
in the fair value of the financial liability that is
attributable to changes in the credit risk of that
liability is recognised in other comprehensive
income, unless the recognition of the effects of
changes in the liability''s credit risk in other
comprehensive income would create or enlarge
an accounting mismatch in profit or loss. The
remaining amount of change in the fair value of
liability is recognised in profit or loss. Changes
in fair value attributable to a financial liability''s
credit risk that are recognised in other
comprehensive income are recognised in
retained earnings. Gains or losses on financial
guarantee contracts issued by the Company that
are designated by the Company as at FVTPL
are recognised in profit or loss.

Financial liabilities subsequently measured at
amortised cost:

Financial liabilities that are not held-for-trading
or designated as at FVTPL, are measured

subsequently at amortised cost using the
effective interest method.

The effective interest method is a method of
calculating the amortised cost of a financial
liability and of allocating interest expense over
the relevant period. The effective interest rate is
the rate that exactly discounts estimated future
cash payments (including all fees and points paid
or received that form an integral part of the
effective interest rate, transaction costs and other
premiums or discounts) through the expected life
of the financial liability, or (where appropriate) a
shorter period, to the amortised cost of a financial
liability.

Foreign exchange gains and losses:

For financial liabilities that are denominated in a
foreign currency and are measured at amortised
cost at the end of each reporting period, the
foreign exchange gains and losses are
determined based on the amortised cost of the
instruments. These foreign exchange gains and
losses are recognised in the ''other income'' line
item in profit or loss for financial liabilities.

The fair value of financial liabilities denominated
in a foreign currency is determined in that foreign
currency and translated at the spot rate at the
end of the reporting period. For financial liabilities
that are measured as at FVTPL, the foreign
exchange component forms part of the fair value
gains or losses and is recognised in profit or loss
for financial liabilities.

Derecognition of financial liabilities:

The Company derecognises financial liabilities
when, and only when, the Company''s obligations
are discharged, cancelled or have expired. The
difference between the carrying amount of the
financial liability derecognised and the
consideration paid and payable is recognised in
profit or loss.

When the Company exchanges with the existing
lender one debt instrument into another one with
the substantially different terms, such exchange
is accounted for as an extinguishment of the
original financial liability and the recognition of a
new financial liability. Similarly, the Company
accounts for substantial modification of terms of
an existing liability or part of it as an
extinguishment of the original financial liability
and the recognition of a new liability. It is
assumed that the terms are substantially different
if the discounted present value of the cash flows
under the new terms, including any fees paid
net of any fees received and discounted using
the original effective rate is at least 10 per cent

different from the discounted present value of
the remaining cash flows of the original financial
liability. If the modification is not substantial, the
difference between: (1) the carrying amount of
the liability before the modification; and (2) the
present value of the cash flows after modification
is recognised in profit or loss as the modification
gain or loss within ''other income''.

(iii) Reclassification of financial assets

The Company determines classification of
financial assets and liabilities on initial
recognition. After initial recognition, no
reclassification is made for financial assets which
are equity instruments and financial liabilities. For
financial assets which are debt instruments, a
reclassification is made only if there is a change
in the business model for managing those assets.

Changes to the business model are expected to
be infrequent. The Company''s senior
management determines change in the business
model as a result of external or internal changes
which are significant to the Company''s
operations. Such changes are evident to external
parties. A change in the business model occurs
when the Company either begins or ceases to
perform an activity that is significant to its
operations. If the Company reclassifies financial
assets, it applies the reclassification
prospectively from the reclassification date which
is the first day of the immediately next reporting
period following the change in business model.
The Company does not restate any previously
recognised gains, losses (including impairment
gains or losses) or interest.

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.

o. Cash and cash equivalents

Cash comprises of cash on hand and demand
deposits with banks. Cash Equivalents are short
term balances (with an original maturity of three
months or less from the date of acquisition),
highly liquid investments that are readily
convertible into known amounts of cash which
are subject to an insignificant risk of changes in
value. Bank balances other than the balance
included in cash and cash equivalents represents
balance on account of unpaid dividend and
margin money deposit with banks.

p. Dividend

Final dividends on shares are recorded as a
liability on the date of approval by the
shareholders and interim dividends are recorded
as a liability on the date of declaration by the
Board of Directors of the Company. The
Company declares and pays dividends in Indian
rupees and are subject to applicable taxes

q. Cash Flow statement

Cash flows are reported using the indirect
method, whereby profit / (loss) after tax is
adjusted for the effects of transactions of non¬
cash nature and any deferrals or accruals of past
or future cash receipts or payments. The cash
flows from operating, investing and financing
activities of the Company are segregated based
on the available information.

r. 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 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 the conversion of all
dilutive potential equity shares. Potential equity
shares are deemed to be dilutive only if their
conversion to equity shares would decrease the
net profit per share from continuing ordinary
operations. Potential dilutive equity shares are
deemed to be converted as at the beginning of
the period, unless they have been issued at a
later date. The dilutive potential equity shares
are adjusted for the proceeds receivable had the
shares been actually issued at fair value (i.e.
average market value of the outstanding shares).
Dilutive potential equity shares are determined
independently for each period presented. The
number of equity shares and potentially dilutive
equity shares are adjusted for share splits /
reverse share splits and bonus shares, as
appropriate.

t. Leases

The Company assesses whether a contract
contains a lease, at inception of a contract. A
contract is, or contains, a lease if the contract
conveys the right to control the use of an
identified asset for a period of time in exchange
for consideration. To assess whether a contract
conveys the right to control the use of an
identified asset, the Company assesses whether:
(1) the contract involves the use of an identified
asset (2) the Company has substantially all of
the economic benefits from use of the asset
through the period of the lease and (3) the
Company has the right to direct the use of the
asset.

At the date of commencement of the lease, the
Company recognizes a right-of-use asset
(“ROU”) and a corresponding lease liability for
all lease arrangements in which it is a lessee,
except for leases with a term of twelve months
or less (short-term leases) and 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.

Certain lease arrangements includes the options
to extend or terminate the lease before the end
of the lease term. ROU assets and lease liabilities
includes these options when it is reasonably
certain that they will be exercised.

The right-of-use assets are initially recognized
at cost, which comprises the initial amount of
the lease liability adjusted for any lease payments
made at or prior to the commencement date of
the lease plus any initial direct costs less any
lease incentives. They are subsequently
measured at cost less accumulated depreciation
and impairment losses

Right-of-use assets are depreciated from the
commencement date on a straight-line basis over
the shorter of the lease term and useful life of
the underlying asset. Right of use assets are
evaluated for recoverability whenever events or
changes in circumstances indicate that their
carrying amounts may not be recoverable. For
the purpose of impairment testing, the
recoverable amount (i.e. the higher of the fair
value less cost to sell and the valuein-use) is
determined on an individual asset basis unless
the asset does not generate cash flows that are
largely independent of those from other assets.
In such cases, the recoverable amount is
determined for the Cash Generating Unit (CGU)
to which the asset belongs. Refer to the
accounting policies in section (i) impairement of
non financial assets.

The lease liability is initially measured at
amortized cost at the present value of the future
lease payments. The lease payments are
discounted using the interest rate implicit in the
lease or, if not readily determinable, using the
incremental borrowing rates in the country of
domicile of the leases. Lease liabilities are
remeasured with a corresponding adjustment to
the related right of use asset if the Company
changes its assessment if whether it will exercise
an extension or a termination option.

Short-term leases

The Company applies the short-term lease
recognition exemption to its short-term leases
(i.e., those leases that have a lease term of 12
months or less from the commencement date

and do not contain a purchase option). Lease
payments on short-term leases are recognised
as expense on a straight-line basis over the lease
term.

u. Segment reporting

Operating segments reflect the Company''s
management structure and the way the financial
information is regularly reviewed by the
Company''s Chief operating decision maker
(CODM). The CEO of the company has been
identified as the Chief Operating Decision Maker
(CODM) as defined by Ind AS 108, Operating
Segments. The CODM considers the business
from both business and product perspective
based on the dominant source, nature of risks
and returns and the internal organisation and
management structure. The operating segments
are the segments for which separate financial
information is available and for which operating
profit / (loss) amounts are evaluated regularly
by the CODM in deciding how to allocate
resources and in assessing performance.

The accounting policies adopted for segment
reporting are in line with the accounting policies
of the Company. Segment revenue, segment
expenses, segment assets and segment

liabilities have been identified to segments on
the basis of their relationship to the operating
activities of the segment.

Inter-segment revenue, where applicable, is
accounted on the basis of transactions which are
primarily determined based on market / fair value
factors.

Revenue, expenses, assets and liabilities which
relate to the Company as a whole and are not
allocable to segments on reasonable basis have
been included under “unallocated revenue /
expenses / assets / liabilities”.

v. Provision for Warranty

The estimated liability for product warranties is
recorded when products are sold. These
estimates are established using historical
information on the nature, frequency and
average cost of warranty claims and
management estimates regarding possible future
incidence based on corrective actions on product
failures. The timing of outflows will vary as and
when warranty claim will arise.

Standards notified but not yet effective

There are no standards that are notified and not yet
effective as on the date.

Nature and purpose of reserves
Securities Premium

Securities premium is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes
such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.

Capital reserve

A scheme of amalgamation of Maharashtra Weldaids Limited (MWL) with the Company, with effect from April 1, 1992,
became effective on February 18, 1994. Accordingly, the results of MWL have been incorporated in the results of the
Company in the financial year ended March 31, 1994. On amalgamation the assets, liabilities and reserves of MWL have
been incorporated at that Company''s book values and the net difference between such values and the net consideration is
accounted for as Capital reserve.

General reserve

Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a
specified percentage in accordance with applicable regulations. The purpose of these transfers was to ensure that if a
dividend distribution in a given year is more than 10% of the paid-up capital of the Company for that year, then the total
dividend distribution is less than the total distributable results for that year. Consequent to introduction of Companies Act
2013, the requirement to mandatorily transfer a specified percentage of the net profit to general reserve has been withdrawn.
However, the amount previously transferred to the general reserve can be utilised only in accordance with the specific
requirements of Companies Act, 2013.

Retained Earnings

Retained earnings are the profits / (loss) that the Company has earned/incurred till date, less any transfers to general
reserve, dividends or other distributions paid to shareholders. Retained earnings include re-measurement loss / (gain) on
defined benefit plans, net of taxes that will not be reclassified to Statement of Profit and Loss.

31. Significant accounting judgements, estimates and assumptions

The preparation of the Company''s Financial Statements requires management to make judgements, estimates and
assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying
disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result
in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.
Other disclosures relating to the Company''s exposure to risks and uncertainties includes:

• Financial risk management objectives and policies Note 39

• Capital management Note 40

Judgements

In the process of applying the Company''s accounting policies, management has not made any judgement, which has
significant effect on the amounts recognised in the Financial Statements.

Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that
have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next
financial year, are described below. The Company based its assumptions and estimates on parameters available when
the financial statements were prepared. Existing circumstances and assumptions about future developments, however,
may change due to market changes or circumstances arising that are beyond the control of the Company. Such changes
are reflected in the assumptions when they occur.

Provision for expected credit losses of trade receivables

The Company uses a provision matrix to calculate ECLs for trade receivables. The provision rates are based on days
past due for groupings of various customer segments that have similar loss patterns. The provision matrix is initially
based on the Company''s historical observed default rates. The Company will calibrate the matrix to adjust the historical

credit loss experience with forward-looking information. At every reporting date, the historical observed default rates are
updated and changes in the forward-looking estimates are analysed. The information about the ECLs on the Company''s
trade receivables is disclosed in Note 8.

Allowances for slow / Non-moving Inventory and obsolescence:

An allowance for Inventory is recognised for cases where the realisable value is estimated to be lower than the inventory
carrying value. The inventory allowance is estimated taking into account various factors, including prevailing sales
prices of inventory item and losses associated with obsolete / slow-moving / redundant inventory items. The Company
has, based on these assessments, made adequate provision in the books.

Deferred income taxes

The Company''s tax expense for the year is the sum of the total current and deferred tax charges. The calculation of the
total tax expense necessarily involves a degree of estimation and judgement in respect of certain items. A deferred tax
asset is recognised when it has become probable that future taxable profit will allow the deferred tax asset to be
recovered. Recognition, therefore involves judgement regarding the prudent forecasting of future taxable gains and
profits of the business.

Defined benefit plans

The cost of the defined benefit plan and other post-employment benefits and the present value of the obligation are
determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from
actual developments in the future. These include the determination of the discount rate, future salary increases and
mortality rates. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is
highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date. Further details
about defined benefit obligations are given in Note 33.

A. Gratuity plan

The Company has a defined benefit gratuity plan for employees which requires contributions to be made to a separately
administered fund. The gratuity plan is governed by the Payment of Gratuity Act, 1972 ("Act"). Under the Act, every
employee who has completed five years or more of service is entitled to this Gratuity payment, on departure, of 15
days'' salary (last drawn salary) for each completed year of service subject to a maximum of Rs. 20 lakhs. The
Company has established a trust to setup an employee group gratuity scheme for providing gratuity benefits to eligible
employees as per the rules of the scheme. The gratuity scheme is funded with Life Insurance Corporation of India
("LIC") for the purpose of providing gratuity benefits to its employees. The Trust is administered by the Board of
Trustees, which is responsible for the administration of the plan assets. The present value of the defined benefit
obligation, and the related current service cost, were measured using the projected unit credit method.

B. Pension fund

The Company has a defined benefit pension plan for employees which requires contributions to be made to a separately
administered fund. The pension benefits payable to the employees are based on the employee''s service and last drawn
salary at the time of leaving. The employees do not contribute towards this plan and the full cost of providing these
benefits are met by the Company. The Company has setup an income tax approved irrevocable trust fund to finance the
plan liability. The Company has funded the defined benefit obligation with Life Insurance Corporation of India.
The present value of the defined benefit obligation, and the related current service cost, were measured using the
projected unit credit method.

Notes:

(i) The Company is contesting the demands and the Management, including its tax advisors, believe that it is possible,
but not probable, the action will succeed and accordingly no provision for liability has been recognised in the
financial statements.

(ii) The timing of the outflow in respect of the above are determinable only on receipt of judgements/decisions pending
before various forums / authorities. The aforesaid amounts do not include any interest to the extent it has not been
determined.

(iii) From time to time, the Company is involved in claims and legal matters arising in the ordinary course of business.
Management is not currently aware of any matters that will have a material adverse effect on the financial position,
results of operations, or cash flows of the Company.

(iv) Excise duty / Service tax cases includes disputes pertains to determination of assessable value, short payment of
service tax on expenditure incurred in foreign currency, inadmissibility of CENVAT credit and applicability of service
tax under reverse charge mechanism, etc.

(v) Income tax cases pertains to disallowance of expenses, etc.

(vi) Sales tax case pertains to reversal of Input Tax Credit on inter-state sales.

(vii) Other cases includes dispute pertains to Non-submission of Bill of Entries under Foreign Exchange Management
Act, 1999 etc.

** Amount is less than the rounding off norm adopted by the Company

*** ESAB corporation, USA being an ultimate holding company of ESAB India Limited, has given a corporate guarantee for
securing the working capital facility from JP Morgan, Chase Bank, N.A.

**** EWAC Alloys Limited, India being a fellow subsidiary of ESAB India Limited, have given 2 surety bonds in favour of
Assistant Director, Directorate of Enforcement, Mumbai in respect of appeal pending in Appellate Tribunal of foreign
exchange pertaining to non-submission of Bill of Entry.

Terms and conditions of transactions with related parties

The sales to and purchases from related parties are made on terms equivalent to those that prevail in arm''s length
transactions. Outstanding balances at the year-end are unsecured and interest free and settlement occurs in cash.
There have been no guarantees provided or received for any related party receivables or payables. For the year ended
March 31, 2025, the Company has not recorded any impairment of receivables relating to amounts owed by related
parties (March 31,2024: Nil). This assessment is undertaken each financial year through examining the financial position
of the related party and the market in which the related party operates.

The investment in unquoted equity shares (Level 3 in the fair value hierarchy) of the company consists of third party
power companies invested at face value as per statutory requirements.

There have been no transfers between the level 1, level 2 and level 3 during the period.

In determining fair value measurement, the impact of potential climate-related matters, including legislation, which may
affect the fair value measurement of assets and liabilities in the financial statements has been considered. At present,
the impact of climate-related matters is not material to the Company''s financial statements.

38. Fair values

The management considers that the carrying amounts of financial assets and financial liabilities recognised in the
financial statements approximate their fair values. Refer note 41 for the value of all financial instruments

39. Major Financial risk management objectives

The Company is exposed to certain financial risks that could have significant influence on the Company''s business and
operational/ financial performance. These include market risk (including commodity price risk, currency risk and interest
rate risk), credit risk and liquidity risk.

The Management reviews and approves risk management framework and policies for managing these risks and monitor
suitable mitigating actions taken by the management to minimise potential adverse effects and achieve greater
predictability to earnings.

In line with the overall risk management framework and policies, the treasury function provides services to the business,
monitors and manages through an analysis of the exposures by degree and magnitude of risks. The Company does not
enter into or trade financial instruments, including derivative financial instruments, for speculative purposes. The Board
of Directors reviews and agrees policies for managing each of these risks, which are summarised below.

Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes
in market prices. Market risk comprises three types of risk: commodity price risk, currency risk and interest rate risk.

Commodity Price Risk

The Company is exposed to commodity price risks primarily on Steel and Minerals. Price and supply disruptions arising
from geopolitical and other developments could affect the Company''s financial assets, profitability and future cash
flows. The Company reviews its commercial arrangements with suppliers and customers at periodic intervals to adapt
to changes arising from commodity price and availability risks.

Foreign Currency Risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes
in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates primarily
to the Company''s operating activities like import of raw materials, components and capital goods from outside India,
incurs few expenditure as well as make export sales to countries outside India.

Unhedged foreign currency

The carrying amounts in Indian Rupees of the Company''s foreign currency denominated monetary assets and monetary
liabilities at the end of the reporting period are as follows:

Forward Exchange Contracts

There are no forward foreign exchange contracts outstanding as at 31 March 2025.

Interest rate risk

The Company is not exposed to interest rate risk because there are no borrowings.

Credit risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading
to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its
financing activities, including deposits with banks and financial institutions. The Company has adopted a policy of dealing
only with creditworthy counterparties as a means of mitigating the risk of financial loss from defaults.

Trade receivables consist of a large number of customers, spread across India. Ongoing credit evaluation is performed on
the financial condition of accounts receivable.

a. Trade receivables

Customer credit risk is managed by the company subject to the Company''s established policy, procedures and control
relating to customer credit risk management.

An impairment analysis is performed at each reporting date using a provision matrix based on transaction date to
measure expected credit losses. The calculation reflects the probability-weighted outcome and reasonable and supportable
information that is available at the reporting date about past events, current conditions and forecasts of future economic
conditions. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial
assets disclosed in Note 41. The Company evaluates the concentration of risk with respect to trade receivables as low,
as its customers are located in several jurisdictions and industries and operate in largely independent markets.

b. Financial instruments and cash deposits

Credit risk from balances with banks and financial institutions is managed by the Company''s treasury department in
accordance with the Company''s policy. Investments of surplus funds are made only with approved counterparties and
within credit limits assigned to each counterparty. Counterparty credit limits are reviewed by the Company''s Board of
Directors on an annual basis and may be updated throughout the year subject to approval of the Company''s Finance
Committee. The limits are set to minimise the concentration of risks and therefore mitigate financial loss through
counterparty''s potential failure to make payments.

The Company invests only on quoted liquid mutual funds with very low credit risk, which are classified under fair value
through profit and loss. The Company''s maximum exposure to credit risk for the components of the balance sheet at 31
March 2025 and 31 March 2024 is the carrying amounts as illustrated in Note 7.

Liquidity risk

The Company manages liquidity risk by maintaining adequate reserves, banking facilities and by continuously monitoring
forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

The Company manages liquidity risk by maintaining sufficient cash and cash equivalents including bank deposits and availability
of funding through an adequate amount of committed credit facilities to meet the obligations when due. Management monitors
rolling forecasts of liquidity position and cash and cash equivalents on the basis of expected cash flows. In addition, liquidity
management also involves projecting cash flows considering level of liquid assets necessary to meet obligations by matching
the maturity profiles of financial assets & liabilities and monitoring balance sheet liquidity ratios.

40. Capital management

The Company manages capital risk in order to maximize shareholders'' profit by maintaining sound/optimal capital
structure. For the purpose of the Company''s capital management, capital includes equity share Capital and Other
Equity and Debt includes Borrowings and Current Maturities of Long term Debt net of Cash and bank balances and
short term investments. The Company monitors capital on the basis of the following gearing ratio. There is no change
in the overall capital risk management strategy of the Company compared to last year.

43 Segment information

ESAB India Limited (‘the Company’) operates in the segment of fabrication technology. This includes
manufacturing and selling of welding, cutting and allied products and also provides engineering, support
and consulting services.

As defined in Ind AS 108, the chief operating decision maker (CODM), evaluates the Company’s performance,
allocate resources based on the analysis of the various performance indicator of the Company as a single
unit. Therefore, there is no reportable segment for the Company as per the requirement of Ind AS 108
“Operating Segments”.

(iii) The Company does not have any transactions with companies struck off under sec 248 of the Companies

Act, 2023 or Section 560 of the Companies Act, 1956 during the financial year. (March 31,2024:Nil)

(iv) The Company has not been declared as wilful defaulter by any bank or financial institution or other
lender.

. (v) The Company does not have any charges or satisfaction which is yet to be registered with ROC

beyond the statutory period.

(vi) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial
year. (March 31,2024: Nil)

(vii) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies),
including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

(a) directly or i ndirectly lend or invest in other persons or entities identified in any manner whatsoever
by or on behalf of the company (Ultimate Beneficiaries) or

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

(viii) The Company has not received any fund from any person(s) or entity(ies), including foreign entities
(Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company
shall:

(a) directly or i ndirectly lend or invest in other persons or entities identified in any manner whatsoever
by or on behalf of the Funding Party (Ultimate Beneficiaries) or

(b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries. (March 31,
2024: Nil)

(ix) 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 assessments under the
Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax
Act, 1961).

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

45. Others

As per the requirement of the rule 3(1) of the Companies (Accounts) Rules, 2014, the Company uses only
such accounting softwares for maintaining its books of account that have a feature of recording audit trail of
each and ev

---

Mar 31, 2024

Terms / rights attached to equity shares

The Company has only one class of equity shares having par value of $ 10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees.The final dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Nature and purpose of reserves Securities Premium

Securities premium is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.

Capital reserve

A scheme of amalgamation of Maharashtra Weldaids Limited (MWL) with the Company, with effect from April 1, 1992, became effective on February 18, 1994. Accordingly, the results of MWL have been incorporated in the results of the Company in the financial year ended March 31, 1994. On amalgamation the assets, liabilities and reserves of MWL have been incorporated at that Company''s book values and the net difference between such values and the net consideration is accounted for as Capital reserve.

General reserve

Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a specified percentage in accordance with applicable regulations. The purpose of these transfers was to ensure that if a dividend distribution in a given year is more than 10% of the paid-up capital of the Company for that year, then the total dividend distribution is less than the total distributable results for that year. Consequent to introduction of Companies Act 2013, the requirement to mandatorily transfer a specified percentage of the net profit to general reserve has been withdrawn. However, the amount previously transferred to the general reserve can be utilised only in accordance with the specific requirements of Companies Act, 2013.

Retained Earnings

Retained earnings are the profits / (loss) that the Company has earned / incurred till date, less any transfers to general reserve, dividends or other distributions paid to shareholders. Retained earnings include re-measurement loss / (gain) on defined benefit plans, net of taxes that will not be reclassified to Statement of Profit and Loss.

30. Earnings per share (EPS)

Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders by the weighted average number of Equity shares outstanding during the year.

Diluted EPS amounts are calculated by dividing the profit attributable to equity holders by the weighted average number of Equity shares outstanding during the year plus the weighted average number of Equity shares that would be issued on conversion of all the dilutive potential Equity shares into Equity shares.

31. Significant accounting judgements, estimates and assumptions

The preparation of the Company''s Financial Statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods. Other disclosures relating to the Company''s exposure to risks and uncertainties includes:

• Financial risk management objectives and policies Note 39

• Capital management Note 40

Judgements

In the process of applying the Company''s accounting policies, management has not made any judgement, which has significant effect on the amounts recognised in the Financial Statements.

Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Company based its assumptions and estimates on parameters available when the financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

Provision for expected credit losses of trade receivables

The Company uses a provision matrix to calculate ECLs for trade receivables. The provision rates are based on days past due for groupings of various customer segments that have similar loss patterns. The provision matrix is initially based on the Company''s historical observed default rates. The Company will calibrate the matrix to adjust the historical credit loss experience with forward-looking information. At every reporting date, the historical observed default rates are updated and changes in the forward-looking estimates are analysed. The information about the ECLs on the Company''s trade receivables is disclosed in Note 8.

Allowances for slow / Non-moving Inventory and obsolescence:

An allowance for Inventory is recognised for cases where the realisable value is estimated to be lower than the inventory carrying value. The inventory allowance is estimated taking into account various factors, including prevailing sales prices of inventory item and losses associated with obsolete / slow-moving / redundant inventory items. The Company has, based on these assessments, made adequate provision in the books.

Deferred income taxes

The Company''s tax expense for the year is the sum of the total current and deferred tax charges. The calculation of the total tax expense necessarily involves a degree of estimation and judgement in respect of certain items. A deferred tax asset is recognised when it has become probable that future taxable profit will allow the deferred tax asset to be recovered. Recognition, therefore involves judgement regarding the prudent forecasting of future taxable gains and profits of the business.

Defined benefit plans

The cost of the defined benefit plan and other post-employment benefits and the present value of the obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date. Further details about defined benefit obligations are given in Note 33.

A. Gratuity plan

The Company has a defined benefit gratuity plan for employees which requires contributions to be made to a separately administered fund. The gratuity plan is governed by the Payment of Gratuity Act, 1972 ("Act"). Under the Act, every employee who has completed five years or more of service is entitled to this Gratuity payment, on departure, of 15 days'' salary (last drawn salary) for each completed year of service subject to a maximum of $ 20 lakhs. The Company has established a trust to setup an employee group gratuity scheme for providing gratuity benefits to eligible employees as per the rules of the scheme. The gratuity scheme is funded with Life Insurance Corporation of India ("LIC") for the purpose of providing gratuity benefits to its employees. The Trust is administered by the Board of Trustees, which is responsible for the administration of the plan assets. The present value of the defined benefit obligation, and the related current service cost, were measured using the projected unit credit method.

The weighted average duration of the defined benefit plan obligation at the end of the reporting year is 7.47 years (31 March 2023: 7.62 years)

B. Pension fund

The Company has a defined benefit pension plan for employees which requires contributions to be made to a separately administered fund. The pension benefits payable to the employees are based on the employee''s service and last drawn salary at the time of leaving. The employees do not contribute towards this plan and the full cost of providing these benefits are met by the Company. The Company has setup an income tax approved irrevocable trust fund to finance the plan liability. The Company has funded the defined benefit obligation with Life Insurance Corporation of India. The present value of the defined benefit obligation, and the related current service cost, were measured using the projected unit credit method.

The following tables summarise the components of net benefit expense recognised in the statement of profit or loss and the funded status and amounts recognised in the balance sheet.

(i) The Company is contesting the demands and the Management, including its tax advisors, believe that it is possible, but not probable, the action will succeed and accordingly no provision for liability has been recognised in the financial statements.

(ii) The timing of the outflow in respect of the above are determinable only on receipt of judgements/decisions pending before various forums/authorities. The aforesaid amounts do not include any interest to the extent it has not been determined.

(iii) From time to time, the Company is involved in claims and legal matters arising in the ordinary course of business. Management is not currently aware of any matters that will have a material adverse effect on the financial position, results of operations, or cash flows of the Company.

(iv) Excise duty / Service tax cases includes disputes pertains to determination of assessable value, short payment of service tax on expenditure incurred in foreign currency, inadmissibility of CENVAT credit and applicability of service tax under reverse charge mechanism, etc.

(v) Income tax cases pertains to disallowance of expenses, etc.

(vi) Sales tax case pertains to reversal of Input Tax Credit on inter-state sales.

(vii) Other cases includes dispute pertains to Non-submission of Bill of Entries under Foreign Exchange Management Act, 1999 etc.

35. Leases

The Company has lease contracts for lease hold lands, lease hold premises and vehicles used in its operations. Leasehold lands generally have lease terms between 15 and 99 years, lease hold premises and motor vehicles have lease terms between 2 and 5 years. The Company''s obligations under its leases are secured by the lessor''s title to the leased assets. Generally, the Company is restricted from assigning and subleasing the leased assets.

The Company also has leases of premises with lease terms of 12 months or less. The Company applies the ''short-term lease'' recognition exemptions for these leases.

** Amount is less than the rounding off norm adopted by the Company

*** ESAB corporation, USA being an ultimate holding company of ESAB India Limited, has given a corporate guarantee for securing the working capital facility from JP Morgan, Chase Bank, N.A.

**** EWAC Alloys Limited, India being a fellow subsidiary of ESAB India Limited, have given 2 surety bonds in favour of Assistant Director, Directorate of Enforcement, Mumbai in respect of appeal pending in Appellate Tribunal of foreign exchange pertaining to non-submission of Bill of Entry.

Terms and conditions of transactions with related parties

The sales to and purchases from related parties are made on terms equivalent to those that prevail in arm''s length transactions. Outstanding balances at the year-end are unsecured and interest free and settlement occurs in cash. There have been no guarantees provided or received for any related party receivables or payables. For the year ended March 31, 2024, the Company has not recorded any impairment of receivables relating to amounts owed by related parties (March 31,2023: Nil). This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.

37. Fair values

The management considers that the carrying amounts of financial assets and financial liabilities recognised in the financial statements approximate their fair values. Refer note 41 for the value of all financial instruments

The investment in unquoted equity shares (Level 3 in the fair value hierarchy) of the Company consists of third party power companies invested at face value as per statutory requirements.

There have been no transfers between the level 1, level 2 and level 3 during the period.

In determining fair value measurement, the impact of potential climate-related matters, including legislation, which may affect the fair value measurement of assets and liabilities in the financial statements has been considered. At present, the impact of climate-related matters is not material to the Company''s financial statements.

39. Major Financial risk management objectives

The Company is exposed to certain financial risks that could have significant influence on the Company''s business and operational / financial performance. These include market risk (including commodity price risk, currency risk and interest rate risk), credit risk and liquidity risk.

The Management reviews and approves risk management framework and policies for managing these risks and monitor suitable mitigating actions taken by the management to minimise potential adverse effects and achieve greater predictability to earnings.

In line with the overall risk management framework and policies, the treasury function provides services to the business, monitors and manages through an analysis of the exposures by degree and magnitude of risks. The Company does not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below.

Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: commodity price risk, currency risk and interest rate risk.

Commodity Price Risk

The Company is exposed to commodity price risks primarily on Steel and Minerals. Price and supply disruptions arising from geopolitical and other developments could affect the Company''s financial assets, profitability and future cash flows. The Company reviews its commercial arrangements with suppliers and customers at periodic intervals to adapt to changes arising from commodity price and availability risks.

Foreign Currency Risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates primarily to the Company''s operating activities like import of raw materials, components and capital goods from outside India, incurs few expenditure as well as make export sales to countries outside India.

Unhedged foreign currency

The carrying amounts in Indian Rupees of the Company''s foreign currency denominated monetary assets and monetary liabilities at the end of the reporting period are as follows:

Foreign currency sensitivity analysis:

The following tables demonstrate the sensitivity to 5% appreciation in USD and EURO exchange rates on foreign currency exposures as at the year end, with all other variables held constant. The impact on the Company''s profit before tax is due to changes in the fair value of monetary assets and liabilities. The Company''s exposure to foreign currency changes for all other currencies is not material.

Interest rate risk

The Company is not exposed to interest rate risk because there are no borrowings.

Credit risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks and financial institutions. The Company has adopted a policy of dealing only with creditworthy counterparties as a means of mitigating the risk of financial loss from defaults.

Trade receivables consist of a large number of customers, spread across India. Ongoing credit evaluation is performed on the financial condition of accounts receivable.

a. Trade receivables

Customer credit risk is managed by the Company subject to the Company''s established policy, procedures and control relating to customer credit risk management.

An impairment analysis is performed at each reporting date using a provision matrix based on transaction date to measure expected credit losses. The calculation reflects the probability-weighted outcome and reasonable and supportable information that is available at the reporting date about past events, current conditions and forecasts of future economic conditions. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed in Note 41. The Company evaluates the concentration of risk with respect to trade receivables as low, as its customers are located in several jurisdictions and industries and operate in largely independent markets.

b. Financial instruments and cash deposits

Credit risk from balances with banks and financial institutions is managed by the Company''s treasury department in accordance with the Company''s policy. Investments of surplus funds are made only with approved counterparties and within credit limits assigned to each counterparty. Counterparty credit limits are reviewed by the Company''s Board of Directors on an annual basis and may be updated throughout the year subject to approval of the Company''s Finance Committee. The limits are set to minimise the concentration of risks and therefore mitigate financial loss through counterparty''s potential failure to make payments.

The Company invests only on quoted liquid mutual funds with very low credit risk, which are classified under fair value through profit and loss. The Company''s maximum exposure to credit risk for the components of the balance sheet at 31 March 2024 and 31 March 2023 is the carrying amounts as illustrated in Note 7.

Liquidity risk

The Company manages liquidity risk by maintaining adequate reserves, banking facilities and by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

The Company manages liquidity risk by maintaining sufficient cash and cash equivalents including bank deposits and availability of funding through an adequate amount of committed credit facilities to meet the obligations when due. Management monitors rolling forecasts of liquidity position and cash and cash equivalents on the basis of expected cash flows. In addition, liquidity management also involves projecting cash flows considering level of liquid assets necessary to meet obligations by matching the maturity profiles of financial assets & liabilities and monitoring balance sheet liquidity ratios.

For the purpose of the Company''s capital management, capital includes issued equity capital, securities premium and all other equity reserves attributable to the equity shareholders. The primary objective of the Company''s capital management is to maximise the shareholder value.

43 Segment information

ESAB India Limited (‘the Company’) operates in the segment of fabrication technology. This includes manufacturing and selling of welding, cutting and allied products and also provides engineering, support and consulting services.

As defined in Ind AS 108, the Chief Operating Decision Maker (CODM), evaluates the Company’s performance, allocate resources based on the analysis of the various performance indicator of the Company as a single unit. Therefore, there is no reportable segment for the Company as per the requirement of Ind AS 108 “Operating Segments”.

Information about major customers:

No customer individually accounted for more than 10% of the revenue.

44. Other Statutory Information

(i) No proceedings has been initiated or are pending against the Company for holding any Benami property under the Benami Transactions (Prohibition) Act, 1988 and rules made thereunder.

(ii) The Company has working capital facilities with Axis Bank, HDFC Bank and JP Morgan Chase Bank. However, the Company has not availed any amount from the banks during the year/in previous years. The quarterly returns (including revised returns) or statements of current assets filed by the company with banks are in agreement with the books of accounts. The Company do not have sanctioned working capital from financial institutions during the year on the basis of security of current assets of the Company. Following is the summary of the details submittted by the Company:

(iii) The Company does not have any transactions with companies struck off under Section 248 of the Companies Act, 2013 or Section 560 of the Companies Act, 1956 during the financial year. (March 31, 2023: Nil)

(iv) The Company has not been declared as wilful defaulter by any bank or financial institution or other lender.

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

(vi) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year. (March 31,2023: Nil)

(vii) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

(a) 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)

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

(viii) The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

(a) 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)

(b) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries. (March 31,2023: Nil)

(ix) 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 assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).

(x) The Company has complied with the number of layers prescribed under Clause (87) of Section 2 of the Act read with Companies (Restriction on number of Layers) Rules, 2017.

45. Events after the reporting period

The board of directors have proposed dividend after the balance sheet date which are subject to approval by the shareholders at the annual general meeting. Refer note 15 for details.

The Company has three accounting software’s for maintaining its books of accounts, one of which is operated by a third-party service provider and used for maintaining its records related to Payroll. All the three-accounting software have a feature of recording audit trail (edit log) facility.

In respect of two accounting softwares, the audit trial and related logs had been enabled from April 12, 2023 except for log pertaining to Property, Plant and Equipment records, where audit trial feature was enabled from March 6, 2024. In respect of these two software, the Company is currently in the process of validating the completeness of audit trial and required logs and also evaluating enablement of features that can track changes made using privileged / administrative access rights to the accounting software and the underlying SQL database.

In respect of third payroll related accounting software, Management is in possession of Service Organisation Controls report and noted that the audit trail feature of the said software was enabled and operated throughout the year for all relevant transactions recorded in the software. Accordingly, there were no instances of the audit trail feature being tampered with.

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Mar 31, 2023

No trade or other receivable are due from directors or other officers of the Company either severally or jointly with any other person nor any trade or other receivable are due from firms or private companies respectively in which any director is a partner, a director or a member. For terms and conditions relating to receivables from related parties, refer Note 35. Trade receivables are non-interest bearing and are generally on terms of 0 to 120 days based on the type of the customer.

Contract Assets:

As at March 31,2023, the Company has contract assets of $ 63 (March 31,2022: 238) which is net off an allowance for expected credit losses of NIL (March 31, 2022: NIL). Revenues in excess of billing are classified as contract asset.

* Includes margin money deposits with the Company''s bankers having a carrying amount of $ 339 (March 31, 2022 -$ 500) which are subject to first charge to secure the Company''s bank guarantees.

Deposits are made for varying periods of between one day and twelve months, depending on the immediate cash requirements of the Company, and earn interest at the respective short-term deposit rates.

The Company has been sanctioned working capital limits from banks during the year on the basis of security of current assets of the Company. The quarterly returns / statements (including revised returns) filed by the Company with such banks are in agreement with the books of accounts of the Company.

b) Terms / rights attached to equity shares

The Company has only one class of equity shares having par value of $ 10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees.The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Nature and purpose of reserves Securities Premium

Securities premium is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.

Amalgamation reserve

A scheme of amalgamation of Maharashtra Weldaids Limited (MWL) with the Company, with effect from April 1, 1992, became effective on February 18, 1994. Accordingly, the results of MWL have been incorporated in the results of the Company in the financial year ended March 31, 1994. On amalgamation the assets, liabilities and reserves of MWL have been incorporated at that Company''s book values and the net difference between such values and the net consideration is accounted for as Amalgamation reserve.

General reserve

Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a specified percentage in accordance with applicable regulations. The purpose of these transfers was to ensure that if a dividend distribution in a given year is more than 10% of the paid-up capital of the Company for that year, then the total dividend distribution is less than the total distributable results for that year. Consequent to introduction of Companies Act 2013, the requirement to mandatorily transfer a specified percentage of the net profit to general reserve has been withdrawn. However, the amount previously transferred to the general reserve can be utilised only in accordance with the specific requirements of Companies Act, 2013.

29. Earnings per share (EPS)

Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders by the weighted average number of Equity shares outstanding during the year.

Diluted EPS amounts are calculated by dividing the profit attributable to equity holders by the weighted average number of Equity shares outstanding during the year plus the weighted average number of Equity shares that would be issued on conversion of all the dilutive potential Equity shares into Equity shares.

30. Significant accounting judgements, estimates and assumptions

The preparation of the Company''s Financial Statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

Judgements

In the process of applying the Company''s accounting policies, management has not made any judgement, which has significant effect on the amounts recognised in the Financial Statements.

Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Company based its assumptions and estimates on parameters available when the financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

Provision for expected credit losses of trade receivables

The Company uses a provision matrix to calculate ECLs for trade receivables. The provision rates are based on days past due for groupings of various customer segments that have similar loss patterns. The provision matrix is initially based on the Company''s historical observed default rates. The Company will calibrate the matrix to adjust the historical credit loss experience with forward-looking information. At every reporting date, the historical observed default rates are updated and changes in the forward-looking estimates are analysed.

Allowances for slow / Non-moving Inventory and obsolescence:

An allowance for Inventory is recognised for cases where the realisable value is estimated to be lower than the inventory carrying value. The inventory allowance is estimated taking into account various factors, including prevailing sales prices of inventory item and losses associated with obsolete / slow-moving / redundant inventory items. The Company has, based on these assessments, made adequate provision in the books.

Deferred income taxes

The Company''s tax expense for the year is the sum of the total current and deferred tax charges. The calculation of the total tax expense necessarily involves a degree of estimation and judgement in respect of certain items. A deferred tax asset is recognised when it has become probable that future taxable profit will allow the deferred tax asset to be recovered. Recognition, therefore involves judgement regarding the prudent forecasting of future taxable gains and profits of the business.

Defined benefit plans

The cost of the defined benefit plan and other post-employment benefits and the present value of the obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date. Further details about defined benefit obligations are given in Note 32.

Deferred tax assets and liabilities are recognized for the future tax consequences of temporary differences between the carrying values of assets and liabilities and their respective tax bases, and unutilized business loss and depreciation carry-forwards and tax credits. Such deferred tax assets and liabilities are computed separately for each taxable entity and for each taxable jurisdiction. Deferred tax assets are recognized to the extent that it is probable that future taxable income will be available against which the deductible temporary differences, unused tax losses, depreciation carryforwards and unused tax credits could be utilized.

A. Gratuity plan

The Company has a defined benefit gratuity plan for employees which requires contributions to be made to a separately administered fund. The gratuity plan is governed by the Payment of Gratuity Act, 1972 ("Act"). Under the Act, every employee who has completed five years or more of service is entitled to this Gratuity payment, on departure, of 15 days'' salary (last drawn salary) for each completed year of service subject to a maximum of $ 20 lakhs. The Company has established a trust to setup an employee group gratuity scheme for providing gratuity benefits to eligible employees as per the rules of the scheme. The gratuity scheme is funded with Life Insurance Corporation of India ("LIC") for the purpose of providing gratuity benefits to its employees. The Trust is administered by the Board of Trustees, which is responsible for the administration of the plan assets.

The weighted average duration of the defined benefit plan obligation at the end of the reporting year is 7.62 years (31 March 2022: 8.19 years).

B. Pension fund

The Company has a defined benefit pension plan for employees which requires contributions to be made to a separately administered fund. The pension benefits payable to the employees are based on the employee''s service and last drawn salary at the time of leaving. The employees do not contribute towards this plan and the full cost of providing these benefits are met by the Company. The Company has setup an income tax approved irrevocable trust fund to finance the plan liability. The Company has funded the defined benefit obligation with Life Insurance Corporation of India.

The following tables summarise the components of net benefit expense recognised in the statement of profit or loss and the funded status and amounts recognised in the balance sheet.

* The Company is contesting the demands and the Management, including its legal counsel, believe that it is possible, but not probable, the action will succeed and accordingly no provision for liability has been recognised in the financial statements. ** The Company is contesting the demands and the Management, including its tax advisors, believe that it is possible, but not probable, the action will succeed and accordingly no provision for liability has been recognised in the financial statements.The timing of the outflow in respect of the above are determinable only on receipt of judgements/decisions pending before various forums / authorities. The aforesaid amounts do not include any interest to the extent it has not been determined.

34. Leases

The Company has lease contracts for lease hold lands, lease hold premises and vehicles used in its operations. Leasehold lands generally have lease terms between 15 and 99 years, lease hold premises and motor vehicles have lease terms between 2 and 5 years. The Company''s obligations under its leases are secured by the lessor''s title to the leased assets. Generally, the Company is restricted from assigning and subleasing the leased assets.

The Company also has leases of premises with lease terms of 12 months or less. The Company applies the ''short-term lease'' recognition exemptions for these leases.

The Company had total cash outflows for leases of $ 210 during the year ($ 181 in March 31, 2022). All the payments are fixed lease payments. There are no variable lease payments in the Company.

35. Related party transactions

(a) Name of related Parties and related party relationship Related Party where control exists

i) As at March 31 2023, ESAB Holdings Limited, UK and Exelvia Group India B.V., Netherlands, being the Principal Shareholders of ESAB India Limited (“Company”) hold 37.31% and 36.41% of the paid up equity share capital of the Company respectively and ESAB Corporation was the ultimate holding company of ESAB India Limited as on the said date.

Colfax Corporation had incorporated a wholly owned subsidiary in the name of ESAB Corporation, Delaware, USA and made ESAB Corporation, Delaware as the holding company of ESAB Holdings Limited, UK and Exelvia Group India B.V., Netherlands. Further, Colfax Corporation had separated itself from ESAB Corporation, Delaware, USA by selling 90% of the equity shares held in ESAB Corporation, Delaware, USA to the general public shareholders of Colfax Corporation thereby reducing its equity stake in ESAB Corporation, Delaware, USA to 10% with effect from April 4, 2022.Subsequently, during the financial year 2022-23, Colfax Corporation has also sold the remaining 10% of equity stake in ESAB Corporation, Delaware.

Terms and conditions of transactions with related parties

The sales to and purchases from related parties are made on terms equivalent to those that prevail in arm''s length transactions. Outstanding balances at the year-end are unsecured and interest free and settlement occurs in cash. There have been no guarantees provided or received for any related party receivables or payables. For the year ended March 31, 2023, the Company has not recorded any impairment of receivables relating to amounts owed by related parties (March 31, 2022: Nil). This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.

The fair values of the financial assets included in the level 1 categories above have been determined in accordance with generally accepted pricing models.

In determining fair value measurement, the impact of potential climate-related matters, including legislation, which may affect the fair value measurement of assets and liabilities in the financial statements has been considered. At present, the impact of climate-related matters is not material to the Company''s financial statements.

38. Major Financial risk management objectives

The Company is exposed to certain financial risks that could have significant influence on the Company''s business and operational/ financial performance. These include market risk (including commodity price risk, currency risk and interest rate risk), credit risk and liquidity risk.

The Management reviews and approves risk management framework and policies for managing these risks and monitor suitable mitigating actions taken by the management to minimise potential adverse effects and achieve greater predictability to earnings.

In line with the overall risk management framework and policies, the treasury function provides services to the business, monitors and manages through an analysis of the exposures by degree and magnitude of risks. The Company does not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below.

Market risk is the risk or uncertainty arising from possible market price movements and their impact on the future performance of a business. The major components of market risk are commodity price risk, foreign currency exchange risk and interest rate risk.

Commodity Price Risk

The Company is exposed to commodity price risks primarily on Steel and Minerals. Price and supply disruptions arising from geopolitical and other developments could affect the Company''s financial assets, profitability and future cash flows. The Company reviews its commercial arrangements with suppliers and customers at periodic intervals to adapt to changes arising from commodity price and availability risks.

Foreign Currency Risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company''s exposure to the risk of changes in foreign exchange rates relates primarily to the Company''s operating activities like import of raw materials, components and capital goods from outside India, incurs few expenditure as well as make export sales to countries outside India.

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks and financial institutions. The Company has adopted a policy of dealing only with creditworthy counterparties as a means of mitigating the risk of financial loss from defaults.

Trade receivables consist of a large number of customers, spread across India. Ongoing credit evaluation is performed on the financial condition of accounts receivable.

Exposure to credit risk

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure is the total of the carrying amount of balances with banks, trade receivables and other financial assets.

The Company has provided for trade receivables amounting to $ 411 (March 31,2022 $ 561) as there was no reasonable expectations of recovery.

Credit risk from balances with banks and bank deposits are managed by the treasury department in accordance with the Company''s policy.

Liquidity risk

The Company manages liquidity risk by maintaining adequate reserves, banking facilities and by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

The Company manages liquidity risk by maintaining sufficient cash and cash equivalents including bank deposits and availability of funding through an adequate amount of committed credit facilities to meet the obligations when due. Management monitors rolling forecasts of liquidity position and cash and cash equivalents on the basis of expected cash flows. In addition, liquidity management also involves projecting cash flows considering level of liquid assets necessary to meet obligations by matching the maturity profiles of financial assets & liabilities and monitoring balance sheet liquidity ratios.

39. Capital management

For the purpose of the Company''s capital management, capital includes issued equity capital, securities premium and all other equity reserves attributable to the equity shareholders. The primary objective of the Company''s capital management is to maximise the shareholder value.

42 Segment information

ESAB India Limited (''the Company'') operates in the segment of fabrication technology. This includes manufacturing and selling of welding, cutting and allied products and also provides engineering, support and consulting services.

As defined in Ind AS 108, the chief operating decision maker (CODM), evaluates the Company''s performance, allocate resources based on the analysis of the various performance indicator of the Company as a single unit. Therefore, there is no reportable segment for the Company as per the requirement of Ind AS 108 "Operating Segments".

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

(iv) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year (March 31,2022: Nil).

(v) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

(a) 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

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

(vi) The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

(a) 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

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

(vii) 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 assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).

44. Impact of COVID

The Company has considered the possible effects that may result from COVID-19 in the preparation of these Financial Results including the recoverability of carrying amounts of financial and non-financial assets. ln developing the assumptions relating to the possible future uncertainties in the global economic conditions because of COVID-19, the Company has, at the date of approval of these Financial Results, used internal and external sources of information which are relevant and expects that the carrying amount of these assets will be recovered. The impact of COVID-19 on the Company''s financial statements may differ from that estimated as at the date of approval of these financial statements and the Company will continue to monitor any material changes to the future economic conditions.

45. Previous year’s figures

Previous year''s figures have been regrouped and reclassified where necessary to conform to this year’s classification.

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Mar 31, 2022

No trade or other receivable are due from directors or other officers of the Company either severally or jointly with any other person nor any trade or other receivable are due from firms or private companies respectively in which any director is a partner, a director or a member. For terms and conditions relating to receivables from related parties, refer Note 36. Trade receivables are non-interest bearing and are generally on terms of 0 to 120 days based on the type of the customer.

As at March 31,2022, the Company has contract assets of $ 238 (March 31,2021: NIL) which is net off an allowance for expected credit losses of NIL (March 31,2021: NIL). Revenues in excess of billing are classified as contract asset.

b) Terms / rights attached to equity shares

The Company has only one class of equity shares having par value of $ 10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees.The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Nature and purpose of reserves Securities Premium

Securities premium is used to record the premium on issue of shares. The reserve can be utilised only for limited purposes such as issuance of bonus shares in accordance with the provisions of the Companies Act, 2013.

Amalgamation reserve

A scheme of amalgamation of Maharashtra Weldaids Limited (MWL) with the Company, with effect from April 1, 1992, became effective on February 18, 1994. Accordingly, the results of MWL have been incorporated in the results of the Company in the financial year ended March 31, 1994. On amalgamation the assets, liabilities and reserves of MWL have been incorporated at that Company''s book values and the net difference between such values and the net consideration is accounted for as Amalgamation reserve.

General reserve

Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a specified percentage in accordance with applicable regulations. The purpose of these transfers was to ensure that if a dividend distribution in a given year is more than 10% of the paid-up capital of the Company for that year, then the total dividend distribution is less than the total distributable results for that year. Consequent to introduction of Companies Act 2013, the requirement to mandatorily transfer a specified percentage of the net profit to general reserve has been withdrawn. However, the amount previously transferred to the general reserve can be utilised only in accordance with the specific requirements of Companies Act, 2013.

30. Earnings per share (EPS)

Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders by the weighted average number of Equity shares outstanding during the year.

Diluted EPS amounts are calculated by dividing the profit attributable to equity holders by the weighted average number of Equity shares outstanding during the year plus the weighted average number of Equity shares that would be issued on conversion of all the dilutive potential Equity shares into Equity shares.

31. Significant accounting judgements, estimates and assumptions

The preparation of the Company''s Financial Statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

Judgements

In the process of applying the Company''s accounting policies, management has not made any judgement, which has significant effect on the amounts recognised in the Financial Statements.

Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Company based its assumptions and estimates on parameters available when the financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

Allowances for slow / Non-moving Inventory and obsolescence:

An allowance for Inventory is recognised for cases where the realisable value is estimated to be lower than the inventory carrying value. The inventory allowance is estimated taking into account various factors, including prevailing sales prices of inventory item and losses associated with obsolete / slow-moving / redundant inventory items. The Company has, based on these assessments, made adequate provision in the books.

Deferred income taxes

The Company''s tax expense for the year is the sum of the total current and deferred tax charges. The calculation of the total tax expense necessarily involves a degree of estimation and judgement in respect of certain items. A deferred tax asset is recognised when it has become probable that future taxable profit will allow the deferred tax asset to be recovered. Recognition, therefore involves judgement regarding the prudent forecasting of future taxable gains and profits of the business.

Defined benefit plans

The cost of the defined benefit plan and other post-employment benefits and the present value of the obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date. Further details about defined benefit obligations are given in Note 33.

A. Gratuity plan

The Company has a defined benefit gratuity plan for employees which requires contributions to be made to a separately administered fund. The gratuity plan is governed by the Payment of Gratuity Act, 1972 ("Act"). Under the Act, every employee who has completed five years or more of service is entitled to this Gratuity payment, on departure, of 15 days'' salary (last drawn salary) for each completed year of service subject to a maximum of $ 20 lakhs. The Company has established a trust to setup an employee group gratuity scheme for providing gratuity benefits to eligible employees as per the rules of the scheme. The gratuity scheme is funded with Life Insurance Corporation of India ("LIC") for the purpose of providing gratuity benefits to its employees. The Trust is administered by the Board of Trustees, which is responsible for the administration of the plan assets.

The following tables summarise the components of net benefit expense recognised in the statement of profit or loss and the funded status and amounts recognised in the balance sheet.

B. Pension fund

The Company has a defined benefit pension plan for employees which requires contributions to be made to a separately administered fund. The pension benefits payable to the employees are based on the employee''s service and last drawn salary at the time of leaving. The employees do not contribute towards this plan and the full cost of providing these benefits are met by the Company. The Company has setup an income tax approved irrevocable trust fund to finance the plan liability. The Company has funded the defined benefit obligation with Life Insurance Corporation of India.

The following tables summarise the components of net benefit expense recognised in the statement of profit or loss and the funded status and amounts recognised in the balance sheet.

* The Company is contesting the demands and the Management, including its legal counsel, believe that it is possible, but not probable, the action will succeed and accordingly no provision for liability has been recognised in the financial statements. ** The Company is contesting the demands and the Management, including its tax advisors, believe that it is possible, but not probable, the action will succeed and accordingly no provision for liability has been recognised in the financial statements.The timing of the outflow in respect of the above are determinable only on receipt of judgements/decisions pending before various forums/authorities. The aforesaid amounts do not include any interest to the extent it has not been determined.

35. Leases

The Company has lease contracts for lease hold lands, lease hold premises and vehicles used in its operations. Leasehold lands generally have lease terms between 15 and 99 years, lease hold premises and motor vehicles have lease terms between 2 and 5 years. The Company''s obligations under its leases are secured by the lessor''s title to the leased assets. Generally, the Company is restricted from assigning and subleasing the leased assets.

The Company also has leases of premises with lease terms of 12 months or less. The Company applies the ‘short-term lease'' recognition exemptions for these leases.

36. Related party transactions

(a) Name of related Parties and related party relationship Related Party where control exists

i) As at March 31 2022, ESAB Holdings Limited, UK and Exelvia Group India B.V., Netherlands, being the Principal Shareholders of ESAB India Limited (“Company”) hold 37.31% and 36.41% of the paid up equity share capital of the Company respectively and Colfax Corporation was the ultimate holding company of ESAB India Limited as on the said date.

Colfax Corporation had incorporated a wholly owned subsidiary in the name of ESAB Corporation, Delaware, USA and made ESAB Corporation, Delaware, USA as the holding company of ESAB Holdings Limited, UK and Exelvia Group India B.V., Netherlands. Further, Colfax Corporation had separated itself from ESAB Corporation, Delaware, USA by selling 90% of the equity shares held in ESAB Corporation, Delaware, USA to the general public shareholders of Colfax Corporation thereby reducing its equity stake in ESAB Corporation, Delaware, USA to 10% with effect from April 4, 2022.

ESAB Corporation, Delaware became the ultimate Parent Company of ESAB India Limited effective April 4, 2022.

Terms and conditions of transactions with related parties

The sales to and purchases from related parties are made on terms equivalent to those that prevail in arm''s length transactions. Outstanding balances at the year-end are unsecured and interest free and settlement occurs in cash. There have been no guarantees provided or received for any related party receivables or payables. For the year ended March 31, 2022, the Company has not recorded any impairment of receivables relating to amounts owed by related parties (March 31,2021: Nil). This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.

37. Fair values

The management considers that the carrying amounts of financial assets and financial liabilities recognised in the financial statements approximate their fair values.

39. Major Financial risk management objectives

The Company is exposed to certain financial risks that could have significant influence on the Company''s business and operational/ financial performance. These include market risk (including commodity price risk, currency risk and interest rate risk), credit risk and liquidity risk.

The Management reviews and approves risk management framework and policies for managing these risks and monitor suitable mitigating actions taken by the management to minimise potential adverse effects and achieve greater predictability to earnings.

In line with the overall risk management framework and policies, the treasury function provides services to the business, monitors and manages through an analysis of the exposures by degree and magnitude of risks. The Company does not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below.

Market Risk

Market risk is the risk or uncertainty arising from possible market price movements and their impact on the future performance of a business. The major components of market risk are commodity price risk, foreign currency exchange risk and interest rate risk.

Commodity Price Risk

The Company is exposed to commodity price risks primarily on Steel and Minerals. Price and supply disruptions arising from geopolitical and other developments could affect the Company''s financial assets, profitability and future cash flows. The Company reviews its commercial arrangements with suppliers and customers at periodic intervals to adapt to changes arising from commodity price and availability risks.

Foreign Currency Risk

The Company imports raw materials, components and capital good from outside India, incurs few expenditure as well as make export sales to countries outside India. The Company is, therefore, exposed to foreign currency risk principally arising out of foreign currency movement against the Indian Currency.

Unhedged foreign currency

The carrying amounts in Indian Rupees of the Company''s foreign currency denominated monetary assets and monetary liabilities at the end of the reporting period are as follows:

Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. The Company has adopted a policy of dealing only with creditworthy counterparties as a means of mitigating the risk of financial loss from defaults.

Trade receivables consist of a large number of customers, spread across India. Ongoing credit evaluation is performed on the financial condition of accounts receivable.

Exposure to credit risk

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure is the total of the carrying amount of balances with banks, trade receivables and other financial assets.

The Company has provided for trade receivables amounting to $ 561 (March 31,2021 $ 451) as there was no reasonable expectations of recovery.

Liquidity risk

The Company manages liquidity risk by maintaining adequate reserves, banking facilities and by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

The Company manages liquidity risk by maintaining sufficient cash and cash equivalents including bank deposits and availability of funding through an adequate amount of committed credit facilities to meet the obligations when due. Management monitors rolling forecasts of liquidity position and cash and cash equivalents on the basis of expected cash flows. In addition, liquidity management also involves projecting cash flows considering level of liquid assets necessary to meet obligations by matching the maturity profiles of financial assets & liabilities and monitoring balance sheet liquidity ratios.

Liquidity tables:

The following tables detail the Company''s remaining contractual maturity for its financial liabilities with agreed repayment periods. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required to pay.

40. Capital management

For the purpose of the Company''s capital management, capital includes issued equity capital, securities premium and all other equity reserves attributable to the equity shareholders. The primary objective of the Company''s capital management is to maximise the shareholder value.

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

(iv) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.

(v) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

(a) 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

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

(vi) The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

(a) 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

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

(vii) 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 assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).

44. Impact of COVID

The Company has considered the possible effects that may result from COVID-19 in the preparation of these Financial Statements including the recoverability of carrying amounts of financial and non-financial assets. ln developing the assumptions relating to the possible future uncertainties in the global economic conditions because of COVID-19, the Company has, at the date of approval of these Financial Statements, used internal and external sources of information which are relevant and expects that the carrying amount of these assets will be recovered. The impact of COVID-19 on the Company''s financial statements may differ from that estimated as at the date of approval of these Financial Statements and the Company will continue to monitor any material changes to the future economic conditions.

45. Previous year’s figures

Previous year''s figures have been regrouped and reclassified where necessary to conform to this year’s classification.

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Mar 31, 2018

1. Standards issued but not yet effective

The amendments to standards that are issued, but not yet effective, up to the date of issuance of the Company''s financial statements are disclosed below. The Company intends to adopt these standards, if applicable, when they become effective.

The Ministry of Corporate Affairs (MCA) has issued the Companies (Indian Accounting Standards) Amendment Rules, 2017 and Companies (Indian Accounting Standards) Amendment Rules, 2018 amending the following standard.

Ind AS 115 Revenue from Contracts with Customers

Ind AS 115 was notified on 28 March, 2018 and establishes a five-step model to account for revenue arising from contracts with customers. Under Ind AS 115, revenue is recognised at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring goods or services to a customer.

The new revenue standard will supersede all current revenue recognition requirements under Ind AS. This new standard requires revenue to be recognized when promised goods or services are transferred to customers in amounts that reflect the consideration to which the Company expects to be entitled in exchange for those goods or services. Adoption of the new rules could affect the timing of revenue recognition for certain transactions of the Company.

Ind AS 115 is effective for the Company in the first quarter of the financial year ending March 31, 2019 using either one of two methods:

(i) retrospectively to each prior reporting period presented in accordance with Ind AS 8 Accounting Policies, Changes in Accounting Estimates and Errors, with the option to elect certain practical expedients as defined within Ind AS 115 (the full retrospective method); or

(ii) retrospectively with the cumulative effect of initially applying Ind AS 115 recognized at the date of initial application (1 April 2018) and providing certain additional disclosures as defined in Ind AS 115 (the modified retrospective method).

The Company continues to evaluate the available transition methods and its contractual arrangements. The ultimate impact on revenue resulting from the application of Ind AS 115 will be subject to assessments that are dependent on many variables, including, but not limited to, the terms of the contractual arrangements and the mix of business. The Company''s considerations also include, but are not limited to, the comparability of its financial statements and the comparability within its industry from application of the new standard to its contractual arrangements.

The Company shall establish an implementation team to implement Ind AS 115 related to the recognition of revenue from contracts with customers and it continues to evaluate the changes to accounting system and processes, and additional disclosure requirements that may be necessary. A reliable estimate of the quantitative impact of Ind AS 115 on the financial statements will only be possible once the implementation project has been completed.

Amendments to Ind AS 12 Recognition of Deferred Tax Assets for Unrealised Leases

The amendments clarify that an entity needs to consider whether tax law restricts the sources of taxable profits against which it may make deductions on the reversal of that deductible temporary difference. Furthermore, the amendments provide guidance on how an entity should determine future taxable profits and explain the circumstances in which taxable profit may include the recovery of some assets for more than their carrying amount.

Entities are required to apply the amendments retrospectively. However, on initial application of the amendments, the change in the opening equity of the earliest comparative period may be recognised in opening retained earnings (or in another component of equity, an appropriate), without allocating the change between opening retained earnings and other components of equity. Entities applying this relief must disclose that fact.

These amendments are effective for annual periods beginning on or after 1 April, 2018. These amendments are not expected to have any impact on the Company.

b) Terms / rights attached to equity shares

The Company has only one class of equity shares having par value of $ 10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

During the year ended March 31, 2018, the amount of per share dividend recognized as distributions to equity shareholders was $ 1/- (March 31, 2017: $ 1/-; April 1, 2016: $ 1/-).

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

A scheme of amalgamation of Maharashtra Weldaids Limited (MWL) with the Company, with effect from April 1, 1992, became effective on February 18, 1994. Accordingly, the results of MWL have been incorporated in the results of the Company in the financial year ended March 31, 1994.

On amalgamation the assets, liabilities and reserves of MWL have been incorporated at that Company''s book values and the net difference between such values and the net consideration is accounted for as Amalgamation Reserve.

28. Earnings per share (EPS)

Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders by the weighted average number of Equity shares outstanding during the year.

Diluted EPS amounts are calculated by dividing the profit attributable to equity holders by the weighted average number of Equity shares outstanding during the year plus the weighted average number of Equity shares that would be issued on conversion of all the dilutive potential Equity shares into Equity shares.

The following reflects the income and share data used in the basic and diluted EPS computations:

29. Capital management

For the purpose of the Company''s capital management, capital includes issued equity capital, securities premium and all other equity reserves attributable to the equity shareholders. The primary objective of the Company''s capital management is to maximise the shareholder value.

30. Major Financial risk management objectives

The Company is exposed to certain financial risks that could have significant influence on the Company''s business and operational/ financial performance. These include market risk (including commodity price risk, currency risk and interest rate risk), credit risk and liquidity risk.

The Management reviews and approves risk management framework and policies for managing these risks and monitor suitable mitigating actions taken by the management to minimise potential adverse effects and achieve greater predictability to earnings.

In line with the overall risk management framework and policies, the treasury function provides services to the business, monitors and manages through an analysis of the exposures by degree and magnitude of risks. The Company does not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below.

Market Risk

Market risk is the risk or uncertainty arising from possible market price movements and their impact on the future performance of a business. The major components of market risk are commodity price risk, foreign currency exchange risk and interest rate risk.

Commodity Price Risk

The primary commodity price risks that the Company is exposed to includes steel price movement that could adversely affect the value of the Company''s financial assets or expected future cash flows. The Company primarily enters into monthly contracts and revisits the prices periodically.

Foreign Currency Risk Management

The Company imports raw materials, components and capital good from outside India, incurs few expenditure as well as make export sales to countries outside India. The Company is, therefore, exposed to foreign currency risk principally arising out of foreign currency movement against the Indian Currency.

Foreign currency sensitivity analysis:

Movement in the functional currencies of the various operations of the Company against major foreign currencies may not impact the Company''s revenues from its operations. Any weakening of the functional currency may not impact the Company''s cost of imports and consequently may not significantly impact the cost of financing the Company''s capital expenditures.

Interest rate risk management

The Company is not exposed to interest rate risk because of absence of debt.

Credit risk management

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. The Company has adopted a policy of dealing only with creditworthy counterparties as a means of mitigating the risk of financial loss from defaults.

Trade receivables consist of a large number of customers, spread across India. On-going credit evaluation is performed on the financial condition of accounts receivable.

Exposure to credit risk

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure is the total of the carrying amount of balances with banks, trade receivables and other financial assets.

The Company has provided for trade receivables amounting to $ 583 (March 31, 2017: $ 418, April 1, 2016: $ 380) as there was no reasonable expectations of recovery.

Liquidity risk management

The Company manages liquidity risk by maintaining adequate reserves, banking facilities and by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

The Company manages liquidity risk by maintaining sufficient cash and cash equivalents including bank deposits and availability of funding through an adequate amount of committed credit facilities to meet the obligations when due. Management monitors rolling forecasts of liquidity position and cash and cash equivalents on the basis of expected cash flows. In addition, liquidity management also involves projecting cash flows considering level of liquid assets necessary to meet obligations by matching the maturity profiles of financial assets & liabilities and monitoring balance sheet liquidity ratios.

Liquidity tables:

The following tables detail the Company''s remaining contractual maturity for its financial liabilities with agreed repayment periods. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required to pay.

The Company has a defined benefit gratuity plan for employees which requires contributions to be made to a separately administered fund. The gratuity plan is governed by the Payment of Gratuity Act, 1972 ("Act"). Under the Act, every employee who has completed five years or more of service is entitled to this Gratuity payment, on departure, of 15 days'' salary (last drawn salary) for each completed year of service subject to a maximum of Rs.20 lakhs. The Company has funded the defined benefit obligation with Life Insurance Corporation of India.

The following tables summarise the components of net benefit expense recognised in the statement of profit or loss and the funded status and amounts recognised in the balance sheet.

Changes in the defined benefit obligation and fair value of plan assets as at 31 March 2018:

The weighted average duration of the defined benefit plan obligation at the end of the reporting year is 8.63 years (31 March 2017: 9.08 years).

B. Pension fund

The Company has a defined benefit pension plan for employees which requires contributions to be made to a separately administered fund. The pension benefits payable to the employees are based on the employee''s service and last drawn salary at the time of leaving. The employees do not contribute towards this plan and the full cost of providing these benefits are met by the Company. The Company has setup an income tax approved irrevocable trust fund to finance the plan liability. The Company has funded the defined benefit obligation with Life Insurance Corporation of India.

The following tables summarise the components of net benefit expense recognised in the statement of profit or loss and the funded status and amounts recognised in the balance sheet.

The tax rate used for the reconciliations above is the corporate tax rate of 34.608% (for the year 2017-18) and 34.608% (for the year 2016-17) payable by corporate entities in India on taxable profits under tax law in Indian jurisdiction.

Deferred tax balances

The following is the analysis of deferred tax assets/(liabilities) presented in the statement of financial position:

Deferred tax assets and liabilities are recognized for the future tax consequences of temporary differences between the carrying values of assets and liabilities and their respective tax bases, and unutilized business loss and depreciation carry-forwards and tax credits. Such deferred tax assets and liabilities are computed separately for each taxable entity and for each taxable jurisdiction. Deferred tax assets are recognized to the extent that it is probable that future taxable income will be available against which the deductible temporary differences, unused tax losses, depreciation carry forwards and unused tax credits could be utilized.

2. Significant accounting judgements, estimates and assumptions

The preparation of the Company''s Financial Statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

Judgements

In the process of applying the Company''s accounting policies, management has made the following judgements, which have the most significant effect on the amounts recognised in the Financial Statements.

Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Company based its assumptions and estimates on parameters available when the Financial Statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

Impairment of non-financial assets

Impairment exists when the carrying value of an asset or cash generating unit exceeds its recoverable amount, which is the higher of its fair value less costs of disposal and its value in use. The fair value less costs of disposal calculation is based on available data from binding sales transactions, conducted at arm''s length, for similar assets or observable market prices less incremental costs for disposing of the asset. The value in use calculation is based on a DCF (Discounted Cash Flow) model. The cash flows are derived from the budget for the next five years and do not include restructuring activities that the Company is not yet committed to or significant future investments that will enhance the asset''s performance of the CGU (Cash Generating Unit) being tested. The recoverable amount is sensitive to the discount rate used for the DCF (Discounted Cash Flow) model as well as the expected future cash-inflows and the growth rate used for extrapolation purposes.

Deferred income taxes

The Company''s tax expense for the year is the sum of the total current and deferred tax charges. The calculation of the total tax expense necessarily involves a degree of estimation and judgement in respect of certain items. A deferred tax asset is recognised when it has become probable that future taxable profit will allow the deferred tax asset to be recovered. Recognition, therefore involves judgement regarding the prudent forecasting of future taxable gains and profits of the business.

Defined benefit plans

The cost of the defined benefit plan and other post-employment benefits and the present value of the obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date. Further details about defined benefit obligations are given in Note 34.

3. Commitment and contingencies

a. Leases

Operating Lease commitments - Company as a lessee

The Company has taken various residential and office premises under operating lease or leave & license agreements. These leases have a term of between 1 year and 3 years, and have no specific obligation for renewal. There are no restrictions placed upon the company by entering into these leases. The lease rentals incurred during the current year have been charged as an expense in the statement of profit and loss. The future lease rental payables as follows:

* The Company is contesting the demands and the Management, including its legal counsel, believe that it is possible, but not probable, the action will succeed and accordingly no provision for liability has been recognised in the financial statements.

**The Company is contesting the demands and the Management, including its tax advisors, believe that it is possible, but not probable, the action will succeed and accordingly no provision for liability has been recognised in the financial statements.

4. Segment Information

Based on internal reporting provided to the chief operating decision maker, Consumables and equipment’s are two reportable segments for the Company. Consumables include Welding electrodes, Copper coated wires, Flux Cored Wires and Welding fluxes including related services. Equipment includes Welding machines and Cutting equipment. The above segments have been identified taking into account the organisation structure as well as differing risks and returns of these segments. Revenues and expenses directly attributable to segments are reported under each reportable segment. Expenses which are not directly identifiable to each reportable segment have been allocated on the basis of associated revenues of the segment and manpower efforts. All other expenses which are not attributable or allocable to segments have been disclosed as unallocable expenses. Assets and liabilities that are directly attributable or allocable to segments are disclosed under each reportable segment. All other assets and liabilities are disclosed as unallocable.

5. Related party transactions

(a) Name of related Parties and related party relationship

Related Party where control exists

i) ESAB Holdings Limited, UK - Principal Shareholder - Holds 37.31% of the paid up equity share capital of the Company as at March 31, 2018. Colfax UK Holdings Limited, Company incorporated under the laws of England and Wales, is an indirect wholly owned subsidiary of Colfax Corporation. Further, Colfax UK, Holdings Limited indirectly holds 100% equity shares of ESAB Holdings Ltd (refer note 15).

ii) Exelvia Group India B.V., Netherlands - Holds 36.41% of the paid up equity share capital of the Company as at March 31, 2018. Colfax UK, Holding Limited, Company incorporated under the laws of England and Wales, is an indirect wholly owned subsidiary of Colfax Corporation. Further, Colfax UK Holdings Limited indirectly holds 100% equity shares of Exelvia Group India B.V., Netherlands (refer note 15).

Terms and conditions of transactions with related parties

The sales to and purchases from related parties are made on terms equivalent to those that prevail in arm''s length transactions. Outstanding balances at the year-end are unsecured and interest free and settlement occurs in cash. There have been no guarantees provided or received for any related party receivables or payables except for corporate guarantee from Colfax Corporation, the Ultimate Holding Company for the loan granted to Howden Solyvent (India) Private Limited. For the year ended March 31, 2018, the Company has not recorded any impairment of receivables relating to amounts owed by related parties (March 31, 2017: Nil, April 01, 2016: Nil). This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.

6. FIRST-TIME ADOPTION OF IND AS

These financial statements, for the year ended March 31, 2018, are the first the Company has prepared in accordance with Ind AS. For periods up to and including the year ended March 31, 2017, the Company prepared its financial statements in accordance with accounting standards notified under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 and the Companies (Indian Accounting Standards) Rules, 2016, as amended. Accordingly, the Company has prepared financial statements which comply with Ind AS applicable for periods ended on March 31, 2018, together with the comparative period data as at and for the year ended March 31, 2017, as described in the summary of significant accounting policies. In preparing these financial statements, the Company''s opening balance sheet was prepared as at April 1, 2016, the Company''s date of transition to Ind AS. This note explains the principal adjustments made by the Company in restating its Indian GAAP financial statements, including the balance sheet as at April 1, 2016 and the financial statements as at and for the year ended March 31, 2017.

Exemptions applied:

Ind AS 101 allows first-time adopters certain exemptions from the retrospective location of certain requirements under Ind AS. The Company has applied the following exemptions:

Deemed cost for property, plant and equipment and intangible assets

Since there is no change in the functional currency, the Company has elected to continue with the carrying value as at April 1, 2016 for all of its intangibles and property plant & equipment as recognised in its Previous GAAP financial as deemed cost at the transition date.

Mandatory exceptions Estimates

The estimates at April 1, 2016 and at March 31, 2017 are consistent with those made for the same dates in accordance with Indian GAAP (after adjustments to reflect any differences in accounting policies) apart from impairment of financial assets based on expected credit loss model where application of Indian GAAP did not require estimation.

The estimates used by the Company to present these amounts in accordance with Ind AS reflect conditions at April 1, 2016 (i.e. the date of transition to Ind-AS) and as of March 31, 2017.

Effect of the Transition to Ind AS

Reconciliations of the Company''s balance sheets prepared under Indian GAAP and Ind AS as of April 1, 2016 and March 31, 2017 are also presented in Note 41 & 42. Reconciliations of the Company''s income statements for the year ended March 31, 2017 prepared in accordance with Indian GAAP and Ind AS in Note 43.

Foot notes to the reconciliation of equity as at April 1, 2016 and March 31, 2017 and profit or loss for the year ended March 31, 2017

A. Property, plant and equipment’s and intangible assets

The Company has elected to continue with the carrying value of all of its property, plant and equipment and intangible assets recognised as at April 1, 2016 (the transition date) measured as per the previous GAAP as its deemed cost as of the transition date. Accordingly, the gross block as at April 1, 2016 is net of accumulated depreciation/ amortisation and impairment of $ 12,129 (refer note 3). Further, in line with Ind AS 105, the Company has re-classified the Land at Khardah to Assets held for sale (refer note 14).

B. Security Deposits

Under Indian GAAP, interest free lease security deposits (that are refundable in cash on completion of the lease term) are recorded at their transaction value. Under Ind AS, all financial assets are required to be recognised at fair value. Accordingly, the Company has fair valued these security deposits under Ind AS. Difference between the fair value and transaction value of the security deposit has been recognised as prepaid rent. The prepaid rent is amortised over the period of the deposit.

C. Investments Carried at fair value through P& L

Under Indian GAAP, the Company accounted for investments in unquoted mutual funds as investment measured at the lower of cost or market value. Under Ind AS, the Company has measured such investments at fair value. The difference between fair value and Indian GAAP carrying amount has been recognized in retained earnings.

D. Deferred tax

Indian GAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. Ind AS 12 requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base. The application of Ind AS 12 approach has resulted in recognition of deferred tax on new temporary differences which was not required under Indian GAAP

In addition, the various transitional adjustments lead to temporary differences. According to the accounting policies, the Company has to account for such differences. Deferred tax adjustments are recognised in correlation to the underlying transaction either in retained earnings or a separate component of equity. On the date of transition, the net impact on deferred tax liabilities is of $ 54 (April 1, 2016: $ 43).

E. Proposed Dividend

Under Indian GAAP, proposed dividends including DDT were recognised as a liability in the period to which they relate, irrespective of when they are declared till March 2016. From financial year ending on March 2017, dividend declared after the balance sheet is not considered as an adjusting event. Thus, the opening Ind AS balance sheet as on 1 April 2016 has a liability recognized. Under Ind AS, a proposed dividend is recognised as a liability in the period in which it is declared by the company (usually when approved by shareholders in a general meeting) or paid.

In the case of the Company, the declaration of dividend occurs after period end. Therefore, the liability of $ 185 for the year ended on 31 March 2016 recorded for dividend has been derecognised against retained earnings on 1 April 2016.

F. Sale of goods

Under Indian GAAP, sale of goods was presented as net of excise duty. However, under Ind AS, sale of goods includes excise duty. Excise duty on sale of goods is separately presented on the face of statement of profit and loss. Thus sale of goods under Ind AS has increased by $ 4,370 (April 1, 2016 - $ 4,402) with a corresponding increase in other expense.

G. Other Comprehensive Income

Both under Indian GAAP and Ind AS, the Company recognised costs related to its post-employment defined benefit plan on an actuarial basis. Under Indian GAAP, the entire cost, including actuarial gains and losses, are charged to profit or loss. Under Ind AS, remeasurements [comprising of actuarial gains and losses, and the return on plan assets excluding amounts included in net interest on the net defined benefit liability] are recognised immediately in the balance sheet with a corresponding debit or credit to retained earnings through OCI. Thus the employee benefit cost is increased by $ 93 for the year 2016-17 and remeasurements gains / losses on defined benefit plans has been recognized in the OCI net of tax.

H. Under IND AS, the Company applies expected credit loss (ECL) model for measurement and recognition of impairment loss on the trade receivables.

I. Under the previous GAAP, leases need to be straight-lined over the period of non-cancellable term. As per Ind AS 17, lease payments under an operating lease shall be recognised as an expense on a straight-line basis over the lease term unless either another systematic basis is more representative of the time pattern of the user''s benefit even if the payments to the lessors are not on that basis or the payments to the lessor are structured to increase in line with expected general inflation to compensate for the lessor''s expected inflationary cost increases. Since the payments to the lessor does not vary because of any factors other than general inflation, the Company has recognised expense on a straight-line basis.

Statement of cash flows

The transition from Indian GAAP to Ind AS has not had a material impact on the statement of cash flows.

7.PREVIOUS YEAR FIGURES

Previous year figures have been regrouped and reclassified where necessary to conform to this year’s classification.

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Mar 31, 2017

b) Rights, preferences and restrictions attached to equity shares

The Company has only one class of equity shares having par value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The final dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

During the year ended March 31, 2017, the amount of per share dividend recognized as distributions to equity shareholders was Rs.Nil (March 31, 2016 : Re.1/-).

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders. [Also refer note 3(e)]

As per records of the Company, including its register of shareholders/ members and other declarations received from shareholders regarding beneficial interest, the above shareholding represents both legal and beneficial ownerships of shares.

Note: * The Company has made adjustment / regrouping to the opening gross block and the accumulated depreciation. However, the same does not have impact on the Statement of Profit and Loss.

** Freehold land includes land held for sale. The Company has discontinued its operations of the Consumable plant at Khardah factory at Kolkatta during the year ended March 31, 2015. The Company has entered into a Memorandum of Understanding (''MOU'') with the prospective buyer on March 14, 2017 to sell the land at this premises. The WDV of the land as at March 31, 2017 amounts to Rs. 102. The Company has obtained advance for sale of the aforesaid land amounting to Rs. 250 (refer note 5).

(a) During the year, the Company has recognized impairment loss on assets identified as not in use. The losses have been recognized in the statement of profit and loss under "Other expense" amounting to Rs. 47.

1. Segment Information

The primary and secondary reportable segments are business segments and geographical segments respectively. These have been identified by the type of their respective products and services, their differing risks and returns, the Company''s organization structure and internal financial reporting systems.

Business Segments

Consumables : Welding electrodes, Copper coated wires, Flux Cored Wires and Welding fluxes including related services. Equipment : Welding machines and Cutting equipment.

* Consumable segment includes impairment loss on fixed assets of one of the Company''s plant at Khardah, Kolkata amounting to Rs. Nil (March 31, 2016 - Rs. 39).

* Equipment segment includes VSS paid to employees and one time settlement to contractors for one of the Company''s plant at Taratala, Kolkata amounting to Rs. 702 (March 31, 2016 - Nil). Also includes impairment of property plant and equipment amounting to Rs. 209 (March 31, 2016 - Nil)

Geographical segments

The Company caters mainly to the needs of Indian market and the export turnover being 4.79% (March 31, 2016 - 3.18%) of the total turnover of the Company, considered as not a reportable geographical segments.

The accounting policies adopted for segment reporting are in line with the accounting policies of the Company.

Revenue and expenses have been identified to segments on the basis of their relationship to the operating activities of the segment. Revenue and expenses which relate to the enterprise as a whole, and not allocable to segments on a reasonable basis, have been included under the heading "other unallocated expenses".

2. Related Party Disclosure

Names of related parties and related party relationship

a) Parties where control exist

i) ESAB Holdings Limited, UK - Principal Shareholder - Holds 37.31% of the paid up equity share capital of the Company as at March 31, 2017. Colfax UK Holding Limited, Company incorporated under the laws of England and Wales, is an indirect wholly owned subsidiary of Colfax Corporation. Further, Colfax UK, Holdings Limited indirectly holds 100% equity shares of ESAB Holdings Ltd.

ii) Exelvia Group India B.V., Netherlands - Holds 36.41% of the paid up equity share capital of the Company as at March 31, 2017. Colfax UK, Holding Limited, Company incorporated under the laws of England and Wales, is an indirect wholly owned subsidiary of Colfax Corporation. Further, Colfax UK Holdings Limited indirectly holds 100% equity shares of Exelvia Group India B.V., Netherlands.

b) Related parties with whom transactions have taken place during the year: (Fellow Subsiadry)

Alcotec Wire Corporation, USA ESAB Polska Sp.Z.O.O., Poland

Cigweld (M) SDN BHD, Malaysia ESAB Vamberk Sro, Czech Republic

^Cig^{weld pt}y ^Ltd., ^Australia ESAB Welding Products, USA

^{ESAB AB Sweden} ESAB Welding Products (Jiangsu) Co Ltd-China ESAB Asia/Pacific Pte. Limited, Singapore

Howden Solyvent (India) Private Limited, India

ESAB Automation Cutting and Welding

Equipment (Wuxi) Co., Ltd., China ^{OZAS-ESAB Sp}.^Z.0.°., ^P°^land

Esab Cutting Systems GmbH, Germany PT Esabindo Pratama, Indonesia

ESAB Europe GmbH, Switzerland PT Karya Yasantara Cakti, Indonesia

^{ESAB Holdin}g^{s Limited UK} PT Victor Teknologi, Indonesia

^{ESAB Middle East FZE, UAE} Thermal Dynamics OY, Finland

Esab North America, Global Cost Nam Florence,

Usa Victor (Ningbo) Cutting & Welding Equipment Trade &

Commerce Co., Ltd., China

ESAB SeAH CORP, Korea

Victor Technologies Asia SDN BHD, Malaysia

ESAB Seah Welding Products(Yantai) Co Ltd

China Victor Technologies International, Inc., USA

c) Key Management Personnel

Managing Director Mr. Rohit Gambhir

Vice President-Finance and

Chief Financial Officer Mr. B. Mohan

Company Secretary Mr. S. Venkatakrishnan

4. The Company has transactions with related parties. For the financial year ended March 31, 2016, the Company has obtained the Accountant''s Report from a Chartered Accountant as required by the relevant provisions of the Income-tax Act, 1961 and has filed the same with the tax authorities. For the financial year ended March 31, 2017, Management confirms that it maintains documents as prescribed by the Income Tax Act, 1961 to prove that these transactions are at arm''s length and the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

5. Restructuring of operations at Taratala, Kolkata

During the current year, the Company undertook a restructuring exercise at Taratala, Kolkata involving optimizing its capacities which resulted in reduction of headcount through a voluntary separation scheme for workmen and one time settlement of some of the contractors. The aforesaid exercise has resulted in the exceptional items of Rs. 911 (March 31, 2016 - Rs. 30) during the year as follows:

a. A Voluntary Separation Scheme (''VSS'') was offered to the workmen of the Company at Taratala plant in Kolkata in the month of January 2017. 11 employees have accepted the VSS and a sum of Rs.159 (March 31, 2016 - Rs. 30) was expended during the current year.

b. Expenditure on one time settlement made to contractors Rs 543 (March 31, 2016 - Nil).

c. Impairment loss on property, plant and equipment at Taratala, Kolkata was made to the extent of Rs. 209 (March 31, 2016 - Nil).

6. Discontinuance of Khardah, Kolkata

The Board of Directors and Shareholders had approved discontinuance of manufacturing operations at its Consumables Plant at Khardah during earlier years. The Board had also approved voluntary separation schemes to the Company''s workmen at Khardah. Consequential expenditure on voluntary separation schemes amounting to Rs. Nil (March 31, 2016 - Rs. 284) and impairment of assets aggregating to Rs. Nil (March 31, 2016 - Rs. 39) have been reported under exceptional items

7. Prior year comparatives

Previous year figures have been regrouped / reclassified, where necessary, to conform to this year''s classification.

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Mar 31, 2016

1. Segment Information

The primary and secondary reportable segments are business segments and geographical segments respectively. These have been identified by the type of their respective products and services, their differing risks and returns, the Company''s organization structure and internal financial reporting systems.

Business Segments

Consumables : Welding electrodes, Copper coated wires, Flux Cored Wires and Welding fluxes including related services. Equipment : Welding machines and Cutting equipment.

@Consumable segment includes impairment loss on fixed assets of one of the Company''s plant at Irungattukottai, Chennai amounting to Rs. Nil (March 31, 2015 - Rs.72).

* Consumable segment includes impairment loss on fixed assets of one of the Company''s plant at Khardah, Kolkata amounting to Rs. 39 (March 31, 2015 - Rs.512).

Geographical segments

The Company caters mainly to the needs of Indian market and the export turnover being 3.18 % (March 31, 2015 - 3.71 %) of the total turnover of the Company, there are no reportable geographical segments.

The accounting policies adopted for segment reporting are in line with the accounting policies of the Company.

Revenue and expenses have been identified to segments on the basis of their relationship to the operating activities of the segment. Revenue and expenses which relate to the enterprise as a whole, and not allocable to segments on a reasonable basis, have been included under the heading "other unallocated expenses".

2. Related Party Disclosure

Names of related parties and related party relationship

a) Parties where control exist

i) ESAB Holdings Limited, UK - Principal Shareholder - Holds 37.31 % of the paid up equity share capital of the Company as at March 31, 2016. Colfax UK Holding Limited, Company incorporated under the laws of England and Wales, is an indirect wholly owned subsidiary of Colfax Corporation. Further, Colfax UK, Holdings Limited indirectly holds 100% equity shares of ESAB Holdings Ltd.

ii) Exelvia Group India B.V., Netherlands - Holds 36.41 % of the paid up equity share capital of the Company as at March 31, 2016. Colfax UK, Holding Limited, Company incorporated under the laws of England and Wales, is an indirect wholly owned subsidiary of Colfax Corporation. Further, Colfax UK Holdings Limited indirectly holds 100% equity shares of Exelvia Group India B.V., Netherlands.

b) Related parties with whom transactions have taken place during the period / year: (Fellow Subsiadry)

ESAB Welding Products (Jiangsu) Co Limited, ESAB Middle East FZE, UAE

China

ESAB SeAH Corporation, Korea

ESAB Asia/Pacific Pte Limited, Singapore

ESAB Vamberk sro, Czech Republic

ESAB Cutting Systems GmbH, Germany

ESAB Africa Welding and Cutting (Proprietary) Limited, ESAB GmbH, Germany South Africa

ESAB Europe AG, Switzerland ESAB Welding & Cutting Product, USA

ESAB AB, Sweden ESAB Polska Sp.z.o.o, Poland

PT Karya Yasantara Cakti, Indonesia ESAB Equipment & Machinery Manufacturing

(Zhangjiagang) Co Limited

Alcotec Wire Corporation, USA

ESAB - Victor Technologies International

ESAB Automation Cutting and Welding

Equipment (Wuxi) Co.Ltd ESAB - Victor (Ningo) Cutting and Welding Equipment

ESAB Seah Welding Products (Yantai) Co Ltd, Howden Solyvent (India) Private Limited

China

c) Key Management Personnel

Managing Director Mr Rohit Gambhir

Vice President-Finance and

Chief Financial Officer Mr B Mohan

Company Secretary Mr S Venkatakrishnan

* The Company is contesting the demands and the Management, including its legal counsel, believe that it is possible, but not probable, the action will succeed and accordingly no provision for liability has been recognized in the financial statements.

** The Company is contesting the demands and the Management, including its tax advisors, believe that it is possible, but not probable, the action will succeed and accordingly no provision for liability has been recognized in the financial statements.

3. The Company has transactions with related parties. For the financial year ended March 31, 2015, the Company has obtained the Accountant''s Report from a Chartered Accountant as required by the relevant provisions of the Income-tax Act, 1961 and has filed the same with the tax authorities. For the financial year ended March 31, 2016, Management confirms that it maintains documents as prescribed by the Income Tax Act, 1961 to prove that these transactions are at arm''s length and the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

4. Exceptional items

The Company had reviewed its manufacturing capacities across its Consumables Plant locations. Following that, the Board of Directors at its meeting held on 26 May, 2015 approved the discontinuance of operations of the Company''s plant at Khardah, Kolkata and moving of its manufacturing and related equipment as required to its other plant locations. The Board had also approved the sale, disposal or transfer of the balance (or remaining) moveable and immoveable assets pertaining to the plant at Khardah, Kolkata.

Exceptional items of Rs.353 (March 31, 2015 Rs.1,761) during the period is on account of the following :

a. A Voluntary Separation Scheme (''VSS'') was offered to all the workmen of the Company at Taratala plant and Khardah plant in Kolkata. 43 employees accepted the VSS and a sum of Rs.314 (March 31, 2015 - Rs.409) was expended during the current year.

b. Impairment loss on fixed assets aggregating to Rs.39 (March 31, 2015 - Rs.512).

c. Expenditure on one time settlement made to contractors Rs.Nil (March 31, 2015 - Rs.840).

5. Impairment loss on tangible and intangible assets

The impairment loss, in case of another factory at Khardah, Kolkata (consumable segment) is recognized on account of management''s decision to discontinue the same. The Company written-down these assets to the net realizable value (net selling price). The losses have been recognized in the statement of profit and loss under the head “exceptional items” amounting to Rs. 39 (March 31, 2015 - Rs.512).

6. Prior year comparatives

The financials statement for the current year have been drawn up for a period of 12 months from April 2015 to March

2016 and hence are not comparable with the comparative information relating to the previous period as they are for a period of 15 months from January 2014 to March 2015. Prior year figures have been reclassified / regrouped wherever necessary to conform to current period''s presentation.

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Mar 31, 2015

1. Company Overview

ESAB India Limited ("the Company") was incorporated on November 10,1987 and commenced its business operations in July 1988. The Company is engaged in the business of welding consumables i.e. welding electrodes, copper coated wires, flux cored wires and welding fluxes and of welding equipment i.e. welding machines and cutting equipment.

b) Rights, preferences and restrictions attached to equity shares

The Company has only one class of equity shares having par value of Rs.10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. During the period ended March 31, 2015, the amount of per share dividend recognized as distributions to equity shareholders was Re. 1/-(December 31,2013: Re.1/-).

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

2. Segment Information

The primary and secondary reportable segments are business segments and geographical segments respectively. These have been identified by the type of their respective products and services, their differing risks and returns, the Company's organisation structure and internal financial reporting systems.

Business Segments

Consumables : Welding electrodes, Copper coated wires, Flux cored wires and Welding fluxes including related services. Equipment : Welding machines and Cutting equipment

Geographical segments

The Company caters mainly to the needs of Indian market and the export turnover being 3.71 % (December 31,2013 - 3.67 %) of the total turnover of the Company, there are no reportable geographical segments.

The accounting policies adopted for segment reporting are in line with the accounting policies of the Company.

Revenue and expenses have been identified to segments on the basis of their relationship to the operating activities of the segment. Revenue and expenses which relate to the enterprise as a whole, and not allocable to segments on a reasonable basis, have been included under the heading "other unallocated expenses".

3. Related Party Disclosure

Names of related parties and related party relationship a) Parties where control exist

i) ESAB Holdings Limited, UK - Principal Shareholder - Holds 37.31% of the paid up equity share capital of the Company as at March 31,2015. Colfax UK Holding Limited, Company incorporated under the laws of England and Wales, is an indirect wholly owned subsidiary of Colfax Corporation. Further, Colfax UK, Holdings Limited indirectly holds 100% equity shares of ESAB Holdings Ltd.

ii) Exelvia Group India B.V., Netherlands - Holds 36.41% of the paid up equity share capital of the Company as at March 31,2015. Colfax UK, Holding Limited, Company incorporated under the laws of England and Wales, is an indirect wholly owned subsidiary of Colfax Corporation. Further, Colfax UK Holdings Limited indirectly holds 100% equity shares of Exelvia Group India B.V., Netherlands.

4. Contingent liabilities and commitments (to the extent not provided for)

Particulars As at As at March 31, 2015 December 31, 2013

Contingent liabilities

Claims against the Company not acknowledged as debts* 824 824

Tax matters in dispute under appeal (excluding possible interest)** 2,913 2,610

Bank guarantees outstanding 1,060 480

Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) 207 248

Estimated amount of contracts remaining to be executed on account of purchase of raw materials 126 152

Total 5,130 4,314

* The Company is contesting the demands and the Management, including its legal counsel, believe that it is possible, but not probable, the action will succeed and accordingly no provision for liability has been recognised in the financial statements.

** The Company is contesting the demands and the Management, including its tax advisors, believe that it is possible, but not probable, the action will succeed and accordingly no provision for liability has been recognised in the financial statements.

5 The Company has transactions with related parties. For the financial year ended March 31,2014, the Company has obtained the Accountant's Report from a Chartered Accountant as required by the relevant provisions of the Income-tax Act, 1961 and has filed the same with the tax authorities. For the financial year ended March 31,2015, Management confirms that it maintains documents as prescribed by the Income Tax Act, 1961 to prove that these transactions are at arm's length and the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

6 Exceptional items

The Company has been reviewing its manufacturing capacities across its Consumables Plant locations. Following this, the Board of Directors at its meeting held on 26 May, 2015 approved the discontinuance of operations of the Company's plant at Khardah, Kolkata and moving of its manufacturing and related equipment as required to its other plant locations. The Board also approved the sale, disposal or transfer of the balance (or remaining) moveable and immoveable assets pertaining to the plant at Khardah, Kolkata subject to the approval of the shareholders at the forthcoming Annual General Meeting scheduled on August 7, 2015.

Exceptional items of Rs.1,761 (December 31,2013 Rs.Nil) during the period is on account of the following :

a. A Voluntary Separation Scheme ('VSS') was offered to all the workmen of the Company at Taratala plant and Khardah plant in Kolkata in the month of June 2014. 43 employees accepted the VSS and a sum of Rs. 409 (December 31,2013 - Nil) was expended during the current period.

b. Impairment loss on fixed assets aggregating to Rs.512 (December 31,2013 - Rs.Nil).

c. Expenditure on one time settlement made to contractors Rs.840 (December 31,2013 - Rs.Nil).

7 Impairment loss on tangible and intangible assets

(a) In case of one of the factories which manufactures flux cored wires (consumable segment), lower demand triggered this impairment loss. The recoverable amount was based on value in use and was determined at the level of the cash-generating unit. The cash-generating unit consisted of the flux cored wires manufacturing unit at Irungattukottai, Chennai. In determining value in use for the cash-generating unit, the cash flows were discounted at a appropriate rate on a pre-tax basis. The losses have been recognized in the statement of profit and loss under the head "other expenses" amounting to Rs. 72 (December 31,2013 - Rs. 45).

(b) The impairment loss, in case of another factory at Khardah, Kolkata (consumable segment) is recognized on account of management's decision to discontinue the same. The Company written-down these assets to the net realizable value (net selling price). The losses have been recognized in the statement of profit and loss under the head "exceptional items" amounting to Rs. 512 (December 31,2013 - Nil).

8 Prior year comparitives

The figures of the previous year were audited by a firm of Chartered accountants other than S.R. Batliboi & Associates LLP.

The financials statement for the current period have been drawn up for a period of 15 months from January 1,2014 to March 31,2015 and hence are not comparable with the comparitive information relating to the previous year as they are for a period of 12 months. Prior year figures have been reclassified / regrouped wherever necessary to conform to current period's presentation.

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Dec 31, 2013

1. Company Overview

ESAB India Limited ("the Company") was incorporated on November 10,1987 and commenced its business operations in July 1988. The Company is engaged in the business of welding consumables i.e. welding electrodes, copper coated wires, flux cored wires and welding fluxes and of welding equipment i.e. welding machines and cutting equipments.

As a result of acquisition of Charter International plc. (''Charter'') in January 2012 by Colfax Corporation, ESAB Holdings Limited, UK and Exelvia Group India B.V. which were 100% subsidiaries of Charter became indirect subsidiaries of Colfax Corporation. Consequently, the Company became a subsidiary of Colfax in 2012. Pursuant to an offer made in 2012, Colfax''s ownership has increased from 56% to 74% in the Company.

2. Segment Information

The primary and secondary reportable segments are business segments and geographical segments respectively. These have been identified by the type of their respective products and services, their differing risks and returns, the Company''s organisation structure and internal financial reporting systems.

Business Segments

Consumables : Welding electrodes, Copper coated wires, Flux cored wires and Welding fluxes including related services.

Equipment : Welding machines and Cutting equipment

Geographical segments

The Company caters mainly to the needs of Indian market and the export turnover being 3.67% (December 31, 2012 - 2.52%) of the total turnover of the Company, there are no reportable geographical segments.

The accounting policies adopted for segment reporting are in line with the accounting policies of the Company.

Revenue and expenses have been identified to segments on the basis of their relationship to the operating activities of the segment. Revenue and expenses which relate to the enterprise as a whole, and not allocable to segments on a reasonable basis, have been included under the heading" other common expenses".

3. Related Party Disclosure

a) Parties where control exist

i) ESAB Holdings Limited - Principal Shareholder - Holds 37.31% of the paid up equity share capital of the Company as at December 31, 2013. Colfax UK Holding Limited, Company incorporated under the laws of England and Wales, is an indirect wholly owned subsidiary of Colfax Corporation. Further, Colfax UK Holdings Limited indirectly holds 100% equity shares of ESAB Holdings Ltd.

ii) Exelvia Group India B.V. - Holds 36.41% of the paid up equity share capital of the Company as at December 31, 2013. Colfax UK Holding Limited, Company incorporated under the laws of England and Wales, is an indirect wholly owned subsidiary of Colfax Corporation. Further, Colfax UK Holdings Limited indirectly holds 100% equity shares of Exelvia Group India B.V.

c) Key Management Personnel

Managing Director - Mr Jiri Kula (up to October 31, 2013)

Executive Director & Chief Executive - Mr Rohit Gambhir (from November 1, 2013)

4. Contingent liabilities and commitments

(to the extent not provided for)

Particulars December 31, 2013 December 31, 2012

Contingent liabilities

Claims against the company not acknowledged as debts 824 824

Tax matters in dispute under appeal 2,610 2,610

Bank guarantees outstanding 480 394

Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) 248 436

Total 4,162 4,264

5. Dues to micro and small suppliers

The management has identified the enterprises which have provided goods and services to the Company and which qualify under the definition of micro and small enterprises, as defined under Micro, Small and Medium Enterprises Development Act, 2006. Such determination / identification has been done on the basis of information received and available with the Company and relied upon by the auditors. Accordingly, the disclosure in respect of the amounts payable to such enterprises as at December 31, 2013 has been made in the financial statements based on information received and available with the Company.

6. The Company has transactions with related parties. For the financial year ended March 31, 2013 the Company has obtained the Accountant''s Report from a Chartered Accountant as required by the relevant provisions of the Income-tax Act, 1961 and has filed the same with the tax authorities. For the year ended December 31, 2013 Management confirms that it maintains documents as prescribed by the Income Tax Act, 1961 to prove that these transactions are at arm''s length and the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

7. Prior year Comparative

Prior period figures have been reclassified / regrouped wherever necessary to confirm to current year''s presentation.

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Dec 31, 2012

1. Company Overview

ESAB India Limited ("the Company") was incorporated on November 10,1987 and commenced its business operations in July 1988. The Company is engaged in the business of welding consumables i.e. welding electrodes, copper coated wires, flux cored wires and welding fluxes and of welding equipment i.e. welding machines and cutting equipments. Pursuant to an offer for acquiring the entire paid up share capital of Charter International pic. (Charter) made on September 12, 2011 and duly approved by the shareholders of Colfax Corporation, (Colfax) and the shareholders of Charter and confirmed by the Royal Court of Jersey vide its order dated January12, 2012, Charter has become an indirect subsidiary of Colfax Corporation, through Colfax UK Holdings Limited. As a result of this acquisition, ESAB Holdings Limited, UK and Exelvia Group India B.V which were 100% subsidiaries of Charter, have now become indirect subsidiaries of Colfax Corporation.

Since 37.31% and 36.41% of the Company''s shares are held by Esab Holdings Limited and Exelvia Group India B.V respectively, being the majority equity shareholders, which are indirect subsidiaries of Colfax Corporation, the Company, during the year, has become a subsidiary of Colfax Corporation. The remaining 26.28% shares are held by institutional investors and the public.

a) Rights, preferences and restrictions attached to equity shares

The Company has a single class of equity shares. Accordingly, all equity shares rank equally with regard to dividends and share in the Company''s residual assets. The equity shares are entitled to receive dividend as declared. The voting rights of an equity shareholder on a poll (not on show of hands) are in proportion to its share of the paid-up equity capital of the Company. On winding up of the Company, the holders of equity shares will be entitled to receive the residual assets of the Company, remaining after distribution of all preferential amounts in proportion to the number of equity shares held.

Geographical segments

The Company caters mainly to the needs of Indian market and the export turnover being 2.52% (December 31, 2011 - 3.36%) of the total turnover of the Company, there are no reportable geographical segments.

The accounting policies adopted for segment reporting are in line with the accounting policies of the Company.

Revenue and expenses have been identified to segments on the basis of their relationship to the operating activities of the segment. Revenue and expenses which relate to the enterprise as a whole, and not allocable to segments on a reasonable basis, have been included under the heading "other common expenses".

2. Related Party Disclosure

a) Parties where control exist

i) ESAB Holdings Limited - Principal Shareholder - Holds 37.31% of the paid up equity share capital of the Company as at December 31, 2012. Colfax UK Holding Limited, Company incorporated under the laws of England and Wales, is an indirect wholly owned subsidiary of Colfax Corporation. Further, Colfax UK, Holdings Limited indirectly holds 100% equity shares of ESAB Holdings Ltd.

ii) Exelvia Group India B.V. - Holds 36.41% of the paid up equity share capital of the Company as at December 31, 2012. Colfax UK, Holding Limited .Company incorporated under the laws of England and Wales, is an indirect wholly owned subsidiary of Colfax Corporation. Further, Colfax UK Holdings Limited indirectly holds 100% equity shares of Exelvia Group India, B.V.

c) Key Management Personnel

Managing Director - Mr.G.Hariharan (upto August 31, 2011)

Managing Director - Mr. Jiri Kula (from September 1, 2011)

3. Contingent liabilities and commitments

(to the extent not provided for)

Particulars December 31,2012 December 31, 2011

Contingent liabilities

Claims against the company not acknowledged as debts 824 824

Tax matters in dispute under appeal 2,610 2,610

Bank guarantees outstanding 394 350

Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) 436 120

Total 4,264 3,904

4. Dues to micro and small suppliers

The management has identified the enterprises which have provided goods and services to the Company and which qualify under the definition of micro and small enterprises, as defined under Micro, Small and Medium Enterprises Development Act, 2006. Such determination / identification has been done on the basis of information received and available with the Company and relied upon by the auditors. Accordingly, the disclosure in respect of the amounts payable to such enterprises as at December 31, 2012 has been made in the financial statements based on information received and available with the Company.

5. The Company has international transactions with related parties. For the financial year ended March 31, 2012, the Company has obtained the Accountant''s Report from a Chartered Accountant as required by the relevant provisions of the Income-tax Act, 1961 and has filed the same with the tax authorities. For the year ended December 31, 2012, Management confirms that it maintains documents as prescribed by the Income Tax Act, 1961 to prove that these international transactions are at arm''s length and the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

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Dec 31, 2011

1. Background

Esab India Limited ("the Company") was incorporated on 10 November 1987 and commenced its business operations in July 1988. The Company is engaged in the business of welding consumables i.e. welding electrodes, copper coated wires, flux cored wires and welding fluxes and of welding equipment i.e. welding machines and cutting equipment. Pursuant to an offer for acquiring the entire paid up share capital of Charter International plc. (Charter) made on 12 September 2011 and duly approved by the shareholders of Colfax Corporation (Colfax) and the shareholders of Charter and confirmed by the Royal Court of Jersey vide its order dated 12 January, 2012, Charter has become an indirect subsidiary of Colfax Corporation, through Colfax UK Holding Ltd. As a result of this acquisition, ESAB Holdings Limited, UK and Exelvia Group India BV which were 100% subsidiaries of Charter, have now become indirect subsidiaries of Colfax Corporation.

Since 37.31% and 18.34% of the Company's shares are held by Esab Holdings Limited and Exelvia Group India BV respectively, being the majority equity shareholders, which are indirect subsidiaries of Colfax Corporation, the Company, subsequent to the balance sheet date, has become a subsidiary of Colfax Corporation. The remaining 44.35% shares are held by institutional investors and the public.

2. Operating lease

The Company has taken various residential and office premises under operating lease or leave & license agreements. These are cancellable; have a term of between 11 months and 3 years, and have no specific obligation for renewal. Lease payments are recognized as an expense in the profit and loss account on a straight line basis over the lease term.

3. Segmental Information

The primary and secondary reportable segments are business segments and geographical segments respectively. These have been identified by the type of their respective products and services, their differing risks and returns, the Company's organisation structure and internal financial reporting systems.

Geographical Segments

The Company caters mainly to the needs of Indian market. The export turnover is 3.36% (31 December 2010: 3.60%) of the total turnover of the Company and segment assets are 0.34% (31 December 2010: 0.55%) of the total assets.

The accounting policies adopted for segment reporting are in line with the accounting policies of the Company.

Revenue and expenses have been identified to segments on the basis of their relationship to the operating activities of the segment. Revenue and expenses which relate to the enterprise as a whole, and not allocable to segments on a reasonable basis, have been included under the heading 'other common expenses'.

4. Related Party Disclosure

a) Parties where control exist

i) Esab Holdings Limited - Principal Shareholder - Holds 37.31% of the paid up equity share capital of the Company as at 31 December 2011. Colfax UK Holding Ltd., a subsidiary of Colfax Corporation, holds indirectly 100% equity shares of Esab Holdings.

Exelvia Group India BV - Holds 18.34 % of the paid up equity share capital of the Company as at 31 December 2011. Exelvia Group India BV is an investment company and is an indirect wholly-owned subsidiary of Colfax Corporation.

b) Colfax Corporation, USA - Related parties in Colfax Corporation, USA Group where significant influence exists :

ESAB Welding Products(Jiangsu)Co. Ltd., China ESAB Middle East LLC., Dubai

ESAB Asia Pacific Pte. Ltd., Singapore ESAB Middle East FZE., Dubai

ESAB Cutting Systems GmbH (Karben),Germany ESAB SEAH Corporation, Korea

ESAB Europe AG, Switzerland ESAB S.A. Industria E Comercio, Brazil

ESAB-ATAS GmbH, Germany ESAB Saldatura S.p.a., Italy

ESAB AB, Sweden OZAS ESAB Sp. Z.O.O., Polland

P.T. Karya Yasantara Cakti, Indonesia ESAB Vamberk s.r.o., Czech Republic

ESAB-Mor Kft, Hungary ESAB Africa Welding Cutting (PTY), South Africa

Alcotec Wire Corporation, USA ESAB Welding & Cutting Product, USA

Conorco Alambres y Soldaduras SA, Argentina Romar Positioning Eqp. Int. Pte Ltd., Singapore

ESAB GmbH Solingen, Belgium ESAB Cutting & Welding Automation (Shanghai) Co. Ltd.,China

ESAB KK, Japan

c) Key Management Personnel (KMP)

Managing Director - Mr.G.Hariharan (Upto 31 August 2011)

Managing Director - Mr. Jiri Kula (appointed on 1 September 2011 for a period of three years)

The Companies listed above have been identified on the basis of information available with the Company.

* Note : Rs. 3.251 million recoverable from a former Managing Director is fully provided for.

5. Micro, Small and Medium Enterprises

Under the Micro, Small and Medium Enterprises Development Act, 2006, (MSMED) which came into force from 2 October 2006, certain disclosures are required to be made relating to Micro, Small and Medium Enterprises. Accordingly, the disclosure in respect of the amounts payable to such enterprises as at 31 December 2011 has been made in the financial statements based on information received and available with the Company. Further in the view of the management, the impact of interest, if any, that may be payable in accordance with the provisions of the Act is not expected to be material.

6. Outstanding forward contracts

The Company does not use foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and forecasted transactions. The Company does not use forward contracts for speculative purposes.

7. Scheme of Amalgamation of ESAB Engineering Services Limited with the Company under Section 391 and 394 of the Companies Act, 1956

A Scheme of Amalgamation ('the Scheme') of Transferor Company viz, ESAB Engineering Services Limited ('EESL') with ESAB India Limited ('the Company' or 'Transferee Company') was sanctioned by the Honorable High Court of Judicature at Madras vide their order dated 9 December 2010 issued on 29 December 2010. Pursuant to this Scheme, the assets and liabilities of the Transferor Companies were transferred to and vested in the transferee company with effect from 1 April 2010 (Appointed Date). The amalgamation has been accounted under the 'pooling of interests' method.

The salient features of the Scheme are as follows:

a. All the assets and liabilities recorded in the books of the Transferor Company shall stand transferred to and vested in the Transferee Company pursuant to the Scheme and shall be recorded by the Transferee Company at their book values as appearing in the books of the Transferor Company;

b. The Transferee Company shall record the Reserves of the Transferor Company in the same form and at the same values as they appear in the financial statements of the Transferor Company at the close of business of the day immediately preceding the Appointed Date. Balances in the Profit and Loss Account of the Transferor Company shall be similarly aggregated with the balances in Profit and Loss Account of the Transferee Company. Balances shown as Miscellaneous Expenditure (to the extent not written off or adjusted), if any, in the balance sheet of the Transferor Company shall be similarly aggregated with balances of the Transferee Company.

c. The excess of, or deficit in, the value of the assets over the value of the liabilities of the Transferor Company vested in the Transferee Company pursuant to this Scheme as recorded in the books of account of the Transferee Company shall, after adjusting the amounts recorded in terms of sub-clause (b) above, be adjusted in the Reserves in the books of the Transferee Company

d. Further, in case of any differences in accounting policy between the Companies, the impact of the same till the amalgamation will be quantified and adjusted in the Profit & Loss Account mentioned earlier to ensure that the financial statements of the Transferee Company reflect the financial position on the basis of consistent accounting policy.

e. To the extent that there are inter-company loans, deposits or balances as between the Transferor Company and the Transferee Company, the obligations in respect thereof shall come to an end and there shall be no liability in that behalf and corresponding effect shall be given in the books of accounts and records of the Transferee Company for the reduction of any assets or liabilities as the case may be and there would be no accrual of interest or any other charges in respect of any such inter-company loans, deposits or balances, with effect from the Appointed date.

f. The authorised share capital of the Transferor Company shall stand combined with the authorised share capital of the Transferee Company. Accordingly, the authorised share capital of the Company is Rs. 220,000 divided into 19,000,000 Equity Shares of Rs. 10/- (Rupees ten) each; and 3,000,000 unclassified shares of Rs.10/- (Rupees ten) each.

g. The shares of the Transferor Company held by the Transferee Company directly and/or through its nominee(s), constituting the entire paid up share capital of the Transferor Company will stand cancelled. No shares or consideration shall be issued / paid by the Transferee Company pursuant to the amalgamation of the Transferor Company, which is a wholly- owned subsidiary of the Transferee Company.

8. The Company has international transactions with related parties. For the financial year 31 March 2011, the Company had obtained the Accountant's Report from a Chartered Accountant as required by the relevant provisions of the Income-tax Act, 1961 and had filed the same with the tax authorities. For the year ended 31 December 2011, the Company has maintained documents as prescribed by the Income-tax Act to prove that these international transactions are at arm's length and the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

9. Prior year figures have been reclassified / regrouped wherever necessary to conform to the current year's classification.

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Dec 31, 2010

1. Background

Esab India Limited ("the Company") was incorporated on 10 November 1987 and commenced its business operations in July 1988. The Company is engaged in the business of welding consumables i.e. welding electrodes, copper coated wires, flux cored wires and welding fluxes and of welding equipment i.e. welding machines and cutting equipment.

37.31% and 18.34% of the Companys shares are held by Esab Holdings Limited and Exelvia Group India BV respectively, being the significant shareholders, which are indirect subsidiaries of Charter International pic. The remaining shares are held by institutional investors and the public. Accordingly the Company is subsidiary of Charter International pic.

2. The Company has taken various residential and office premises under operating lease or leave & license agreements. These are cancellable; have a term of between 11 months and 3 years, and have no specific obligation for renewal. Lease payments are recognized as an expense in the profit and loss account on a straight-line basis over the lease term.

3. Segmental Information

The primary and secondary reportable segments are business segments and geographical segments respectively. These have been identified by the type of their respective products and services, their differing risks and returns, the Companys organisation structure and internal financial reporting systems.

Geographical Segments

The Company caters mainly to the needs of Indian market. The export turnover is 3.60% (31 December 2009:1.51 %) of the total turnover of the Company and segment assets are 0.55% (31 December 2009: 0.58%) of the total assets.

The accounting policies adopted for segment reporting are in line with the accounting policies of the Company.

Revenue and expenses have been identified to segments on the basis of their relationship to the operating activities of the segment. Revenue and expenses which relate to the enterprise as a whole, and not allocable to segments on a reasonable basis, have been included under the heading other common expenses.

4. Related Party Disclosure

a) Parties where Control exist

i) Esab Holdings Limited - Principal Shareholder - Holds 37.31 % of the paid up equity share capital of the Company as at 31 December 2010. Charter Overseas Holdings Limited, the holding company of Esab Holdings Limited is a subsidiary of Charter International pic.

Exelvia Group India BV - Holds 18.34 % of the paid up equity share capital of the Company as at 31 December 2010. Exelvia Group India BV is an investment company and is an indirect wholly-owned subsidiary of Charter International pic.

(b) Charter International pic Group - Related parties in the Charter International pic Group where significant influence exists :

Esab Welding Products(Jiangsu) Co. Ltd., China Esab Middle East LLC, Dubai

Esab Asia Pacific Pte. Ltd., Singapore Esab Middle East FZE., Dubai

Esab Cutting Systems GmBH (Karben),Germany Esab SeAH Corporation, Korea

OZAS-ESAB Sp. Z.o.o., Poland Esab S.A. Industria e Comercio, Brazil

Esab Cutting & Welding Automation (Shanghai) Ltd., Esab Saldatura S.p.a, Italy

Esab AB, Sweden Esab Sp. Z.o.o., Poland

P.T. Karya Yasantara Cakti, Indonesia Esab Vamberk s.r.o., Czech Republic

Esab-Mor Kft, Hungary Esab Group (UK) Ltd.

Alcotec Wire Corporation - USA Esab Welding & Cutting Product, USA

Conorco Alambres y Soldaduras SA, Argentina Romar Positioning Eqp. Int. Pte Ltd.

Esab GmBH Solingen, Belgium ESAB-ATAS GmBH

Esab Holdings Ltd., U.K. Esab Europe AG, Switzerland

Esab KK, Japan Esab Engineering Services Limited *

* Amalgamated with the Company with effect from 1 April 2010 (Refer note 25 of Schedule O)

c) Key Management Personnel

Managing Director - Mr G Hariharan (appointed on 1 September 2006 for a period of five years).

5. Micro, Small and Medium Enterprises

Under the Micro, Small and Medium Enterprises Development Act, 2006, (MSMED) which came into force from 2 October 2006, certain disclosures are required to be made relating to Micro, Small and Medium Enterprises. Accordingly, the disclosure in respect of the amounts payable to such enterprises as at 31 December 2010 has been made in the financial statements based on information received and available with the Company. Further in the view of the management, the impact of interest, if any, that may be payable in accordance with the provisions of the Act is not expected to be material.

6. Outstanding forward contracts

The Company does not use foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and forecasted transactions. The Company does not use forward contracts for speculative purposes.

7. The Company has international transactions with related parties. For the financial year 31 March 2010, the Company had obtained the Accountants Report from a Chartered Accountant as required by the relevant provisions of the Income-tax Act, 1961 and had filed the same with the tax authorities. For the year ended 31 December 2010, the Company has maintained documents as prescribed by the Income-tax Act to prove that these international transactions are at arms length and the aforesaid legislation will not have any impact on the financial statements, particularly on the amount of tax expense and that of provision for taxation.

8 On account of Scheme of arrangement and amalgamation with ESAB Engineering Services Limited in the current year previous year figures are not strictly comparable. Previous year figures have been regrouped and reclassified wherever necessary.

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Dec 31, 2009

1. Background

Esab India Limited ("the Company") was incorporated on 10 November 1987 and commenced its business operations in July 1988. The Company is engaged in the business of welding consumables i.e. welding electrodes, copper coated wires, flux cored wires and welding fluxes and of welding equipment i.e. welding machines and cutting equipment. 37.31% and 18.34% of the Companys shares are held by Esab Holdings Limited and Exelvia Group India BV respectively, being the significant shareholders, which are indirect subsidiaries of Charter International pic. The remaining shares are held by institutional investors and the public. Accordingly the Company is subsidiary of Charter International pic.

2009 2008 Rs.OOO Rs.OOO

2. Contingent Liabilities

For Disputed Taxes and Duties 225,302 190,430

Claims Against the Company not acknowledged as debts 76,272 70,164

3. The Company has taken various residential and office premises under operating lease or leave & license agreements. These are cancellable; have a term of between 11 months and 3 years, and have no specific obligation for renewal. Lease payments are recognized as an expense in the profit and loss account on a straight line basis over the lease term.

4. Segmental Information

The Primary and secondary reportable segments are business segments and geographical segments respectively. These have been identified by the type of their respective products and services, their differing risks and returns, the Companys Organisation structure and internal financial reporting systems.

Geographical Segments

The Company caters mainly to the needs of Indian market. The export turnover is 1.51% (31 December 2008: 2.53%) of the total turnover of the Company and segment assets are 0.58% (31 December 2008: 1.50%) of the total assets.

The accounting policies adopted for segment reporting are in line with the accounting policies of the Company.

Revenue and expenses have been identified to segments on the basis of their relationship to the operating activities of the segment. Revenue and expenses which relate to the enterprise as a whole, and not allocable to segments on a reasonable basis, have been included under the heading "other common expenses".

5. Related Party Disclosure

(a) Parties where Control exists

i) Esab Holdings Limited - Principal Shareholder - Holds 37.31 % of the paid up equity share capital of the Company as at 31 December 2009. Charter Overseas Holdings Limited, the holding company of Esab Holdings Limited is a subsidiary of Charter International pic,

ii) Exelvia Group India BV - Holds 18.34% of the paid up equity share capital of the Company as at 31 December 2009. Exelvia Group India BV is an investment company and is an indirect wholly-owned subsidiary of Charter International pic.

(b) Charter International pic Group - Related parties in the Charter International pic Group where significant influence exists :

Esab Engineering Services Limited, India

Esab Asia Pacific Pte. Ltd., Singapore

Esab Cutting Systems GmbH (Karben),Germany

OZAS-ESAB Sp. Z.o.o., Poland

Esab Cutting & Welding Automation (Shanghai) Ltd.

Esab AB, Sweden

P.T. Karya Yasantara Cakti, Indonesia

Esab-Mor Kft,Hungary

Alcotec Wire Corporation -USA

Conorco Alambres y Soldaduras SA, Argentina

Esab GmBH Solingen,Belgium

Esab Welding Products(Jiangsu)Co Ltd. China

Esab Middle East LLC, Dubai

Esab Middle East FZE., Dubai

Esab SeAH Corporation, Korea

Esab S.A. Industria e Comercio, Brazil

Esab Saldatura S.p.a, Italy

Esab Sp. Z.o.o., Poland

Esab Vamberk s.r.o., Czech Republic

Esab Group (UK) Ltd

Esab Welding & Cutting Product USA

Romar Positoning Eqp. Int. Pte Ltd.

Esab-ATAS GmBh

Esab KK, Japan ;

(c) Key Management Personnel

Managing Director - Mr.G.Hahharan (appointed on 1 September 2006 for a period of five years).

6. Micro, Small and Medium Enterprises

Under the Micro, Small and Medium Enterprises Development Act, 2006, (MSMED) which came into force from 2 October 2006, certain disclosures are required to be made relating to Micro, Small and Medium Enterprises. Accordingly, the disclosure in respect of the amonts payable to such enterprises as at 31 December 2009 has been made in the financials statements based on information received and available with the Company. Further in the view of the management, the impact of interest, if any, that may be payable in accordance with the provisions of the Act is not expected to be material.

7. Outstanding forward contracts

The Company does not use foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and forecasted transactions. The Company does not use forward contracts for speculative purposes.

8. Prior year comparatives have been regrouped wherever necessary to conform to current years presentation.