One97 Communications Ltd. के अकाउंट के लिये नोट

Mar 31, 2025

i. Provisions and contingencies
Provisions

Provisions are recognised when the Company
has a present obligation (legal or constructive)
as a result of a past event, 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.

When the Company expects some or all of a
provision to be reimbursed, the reimbursement
is recognised as a separate asset, but only
when the reimbursement is virtually certain.
The expense relating to a provision is presented
in the statement of profit and loss net of
any reimbursement.

If the effect of the time value of money is material,
provisions are discounted using a current pre¬
tax rate that reflects, when appropriate, the risks
specific to the liability. When discounting is used,
the increase in the provision due to the passage
of time is recognised as a finance cost.

Contingencies

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. A contingent liability also
arises in extremely rare cases where there is a
liability that cannot be recognized because it
cannot be measured reliably. The Company does
not recognize a contingent liability but discloses
its existence in the financial statements.

j. Retirement and other employee benefits

For defined benefit plans (gratuity and long term
incentive plan), the liability or asset recognised
in the balance sheet is the present value of
the defined benefit obligation at the end of the
reporting period less the fair value of plan assets.
The defined benefit obligation is calculated by
an independent actuary using the projected
unit credit method.

The present value of the defined benefit obligation
is determined by discounting the estimated future
cash outflows by reference to market yields at
the end of the reporting period on government
bonds that have terms approximating to the
terms of the related obligation.

The net interest cost is calculated by applying the
discount rate to the net balance of the defined
benefit obligation and the fair value of plan
assets. This cost is included in employee benefit
expense in the statement of profit and loss.

Re-measurement gains and losses arising from
experience adjustments and changes in actuarial
assumptions are recognised in the period in
which they occur, directly in OCI. They are
included in retained earnings in the statement
of changes in equity and in the balance sheet.

Re-measurements are not reclassified to profit
or loss in the subsequent periods.

Changes in the present value of the defined
benefit obligation resulting from plan

amendments or curtailments are recognised
immediately in profit or loss as past service cost.

The Company''s contributions to defined

contribution plans (provident fund) are recognized
in profit or loss when the employee renders related
service. The Company has no further obligations
under these plans beyond its periodic contributions.

The Company provides for liability at period
end on account of un-availed earned leave and
Long Term Incentive Plan (''LTIP'') as per actuarial
valuation using projected unit credit method.

Liabilities for wages and salaries, including non¬
monetary benefits that are expected to be settled
wholly within 12 months after the end of the
period in which the employees render the related
service are recognised in respect of employees''
services up to the end of the reporting period and
are measured at the amounts expected to be paid
when the liabilities are settled. The liabilities are
presented as employee benefit payable under
other financial liabilities in the balance sheet.

The Code on Social Security, 2020 (''Code'')
relating to employee benefits during employment
and post-employment benefits received
Presidential assent in September 2020. The
Code has been published in the Gazette of
India. Certain sections of the code came into
effect on May 3, 2023. However, the final rules/
interpretation have not yet been issued. Based
on a preliminary assessment, the entity believes
the impact of the change will not be significant.

k. Share-based payments
Equity-settled transactions

Employees (including senior executives) of the
Company receive remuneration in the form of
share-based payments, whereby employees
render services as consideration for equity
instruments (equity-settled transactions).

The cost of equity-settled transactions is
determined by the fair value at the date
when the grant is made using an appropriate
valuation model.

That cost is recognised, together with a
corresponding increase in Employee Stock
Option Plan (ESOP) reserves in equity, over the
period in which the performance and/or service
conditions are fulfilled in employee benefits
expense. The cumulative expense recognised
for equity-settled transactions at each reporting
date until the vesting date reflects the extent
to which the vesting period has expired and
the Company''s best estimate of the number of
equity instruments that will ultimately vest. The
statement of profit and loss expense or credit for
a period represents the movement in cumulative
expense recognised as at the beginning and end
of that period and is recognised in employee
benefits expense.

Performance conditions which are market
conditions are taken into account when determining
the grant date fair value of the awards. Service and
non-market performance conditions are not taken
into account when determining the grant date fair
value of awards, but the likelihood of the conditions
being met is assessed as part of the Company''s
best estimate of the number of equity instruments
that will ultimately vest.

No expense is recognised for awards that do not
ultimately vest because non-market performance
and/or service conditions have not been met.

When the terms of an equity-settled award are
modified, the minimum expense recognised is the
expense had the terms not been modified, if the
original terms of the award are met. An additional
expense is recognised for any modification that
increases the total fair value of the share-based
payment transaction, or is otherwise beneficial
to the employee as measured at the date of
modification. Where an award is cancelled by
the entity or by the counterparty, any remaining
element of the fair value of the award is expensed
immediately through profit or loss.

The dilutive effect of outstanding options is
reflected as additional share dilution in the
computation of diluted earnings per share.

l. 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

Initial recognition and measurement

All financial assets are recognised initially at
fair value plus, in the case of financial assets
not recorded at fair value through profit or
loss, transaction costs that are attributable to
the acquisition of the financial asset. However,
trade receivables that do not contain a
significant financing component are measured at
transaction price.

Subsequent measurement

For purposes of subsequent measurement,
financial assets are classified in four categories:

• Debt instruments at amortized cost

• Debt instruments at fair value through other
comprehensive income (FVTOCI)

• Debt instruments, derivatives and equity
instruments at fair value through profit
or loss (FVTPL)

• Equity instruments measured at fair value
through other comprehensive income
(FVTOCI)

Debt instruments at amortised cost

A ''debt instrument'' is measured at the amortised
cost if both the following conditions are met:

a) The asset is held within a business model
whose objective is to hold assets for
collecting contractual cash flows, and

b) Contractual terms of the asset give rise on
specified dates to cash flows that are solely
payments of principal and interest (SPPI) on
the principal amount outstanding.

After initial measurement, such financial assets
are subsequently measured at amortised cost
using the effective interest rate (EIR) method.
Amortised cost is calculated by taking into
account any discount or premium on acquisition
and fees or costs that are an integral part of the
EIR. The EIR amortization is included in finance
income in the profit or loss. The losses arising from
impairment are recognised in the profit or loss.
This category generally applies to trade and other
receivables and is most relevant to the Company.

Debt instrument at FVTOCI

A ''debt instrument'' is classified as at the FVTOCI
if both of the following criteria are met:

a) The objective of the business model is
achieved both by collecting contractual cash
flows and selling the financial assets, and

b) The asset''s contractual cash flows
represent SPPI.

Debt instruments included within the FVTOCI
category are measured initially as well as at each
reporting date at fair value. Fair value movements
are recognized in the OCI. However, the Company
recognizes interest income, impairment losses
and reversals and foreign exchange gain or
loss in the statement of profit and loss. On
derecognition of the asset, cumulative gain or
loss previously recognised in OCI is reclassified
from the equity to the statement of profit and
loss. Interest earned whilst holding FVTOCI debt
instrument is reported as interest income using
the EIR method.

Debt instrument at FVTPL

FVTPL is a residual category for debt instruments.
Any debt instrument, which does not meet the
criteria for categorization as at amortized cost or
as FVTOCI, is classified as at FVTPL.

In addition, the Company may elect to designate
a debt instrument, which otherwise meets
amortized cost or FVTOCI criteria, as at FVTPL.
However, such election is allowed only if doing
so reduces or eliminates a measurement or
recognition inconsistency (referred to as
''accounting mismatch'').

Debt instruments included within the FVTPL
category are measured at fair value with all changes
recognized in the statement of profit and loss.

Equity investments

All equity investments in scope of Ind AS 109
''Financial Instruments'' are measured at fair
value. The Company may make an irrevocable
election to present in OCI subsequent changes
in the fair value. The Company makes such
election on an instrument-by-instrument basis.
The classification is made on initial recognition
and is irrevocable.

If the Company decides to classify an equity
instrument as at FVTOCI, then all fair value
changes on the instrument, excluding dividends,
are recognized in the OCI. There is no recycling
of the amounts from OCI to statement of profit
or loss, even on sale of investment. However, the
Company may transfer the cumulative gain or
loss within equity.

Equity instruments included within the FVTPL
category are measured at fair value with
all changes recognized in the statement of
profit and loss.

The equity securities which are not held for
trading, and for which the Company has made
an irrevocable election at initial recognition to
recognize changes in fair value through OCI
rather than profit or loss as these are strategic
investments and the Company considered this to
be more relevant.

Equity investments in subsidiaries, associates
and joint ventures are measured at cost. The
investments are reviewed at each reporting date
to determine whether there is any indication of
impairment considering the provisions of Ind AS
36 ''Impairment of Assets''. If any such indication
exists, policy for impairment of non-financial
assets is followed.

Derecognition

A financial asset (or, where applicable, a part of a
financial asset or part of a group of similar financial
assets) is primarily derecognised (i.e. removed
from the Company''s balance sheet) when:

• The rights to receive cash flows from the
asset have expired, or

• The Company has transferred its rights
to receive cash flows from the asset or
has assumed an obligation to pay the
received cash flows in full without material
delay to a third party under a ''pass¬
through'' arrangement; and either (a) the
Company has transferred substantially
all the risks and rewards of the asset, or
(b) the Company has neither transferred
nor retained substantially all the risks and
rewards of the asset, but has transferred
control of the asset.

When the Company has transferred its rights to
receive cash flows from an asset or has entered
into a pass-through arrangement, it evaluates
if and to what extent it has retained the risks
and rewards of ownership. When it has neither
transferred nor retained substantially all of the
risks and rewards of the asset, nor transferred
control of the asset, the Company continues to
recognise the transferred asset to the extent
of the Company''s continuing involvement. In
that case, the Company also recognises an
associated liability. The transferred asset and
the associated liability are measured on a basis
that reflects the rights and obligations that the
Company has retained.

Impairment of financial assets

In accordance with Ind AS 109, the Company
applies expected credit loss (ECL) model for
measurement and recognition of impairment loss
on financial assets that are debt instruments,
and are measured at amortised cost e.g., loans,
debt securities, deposits, trade receivables
and bank balance.

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

For recognition of impairment loss on other
financial assets and risk exposure, the Company
determines that whether there has been a
significant increase in the credit risk since initial
recognition. If credit risk has not increased
significantly, 12-month expected credit loss
(ECL) is used to provide for impairment loss.
However, if credit risk has increased significantly,
lifetime ECL is used. If, in a subsequent period,
credit quality of the instrument improves such
that there is no longer a significant increase in
credit risk since initial recognition, then the entity
reverts to recognising impairment loss allowance
based on 12-month ECL.

Lifetime ECL are the expected credit losses
resulting from all possible default events over
the expected life of a financial instrument. The

12-month ECL is a portion of the lifetime ECL which
results from default events that are possible within
12 months after the reporting date.

ECL 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 entity expects to receive (i.e., all
cash shortfalls), discounted at the original EIR.

The Company uses a provision matrix to
determine impairment loss allowance on portfolio
of its trade receivables. The provision matrix is
based on its historically observed default rates
over the expected life of the trade receivables
and is adjusted for forward-looking estimates.
At every reporting date, the historical observed
default rates are updated and changes in the
forward-looking estimates are analyzed.

ECL impairment loss allowance (or reversal)
recognized during the period is recognized as
income/ expense in the statement of profit and
loss. This amount is reflected under the head other
expenses in the statement of profit and loss. For
the financial assets measured as at amortised
cost, ECL is presented as an allowance, i.e., as an
integral part of the measurement of those assets in
the balance sheet. The allowance reduces the net
carrying amount. Until the asset meets write-off
criteria, the Company does not reduce impairment
allowance from the gross carrying amount.

Financial Guarantee Contracts

The Company acts as Lending Service Provider and
in certain arrangements with the lender, it issues
Default Loss Guarantee (DLG) as per the Digital
Lending Guidelines issued by Reserve Bank of India
referred in the financial statements as "financial
guarantees". Financial Guarantees which are initially
recognised in the financial statements (within
Other Financial Liabilities) at fair value (premium).
Subsequent to initial recognition, the Company''s
liability under each financial guarantee is measured
at the higher of the amount initially recognised less
cumulative amortisation, and the ECL.

Financial Guarantee Premium

The financial guarantee premium received is
recognised in the Standalone Statement of
Profit and Loss account under Sale of Service
on a weighted average basis over the estimated
tenure of the guarantee.

ECL methodology

The Company calculates the ECL as a product
of the Exposure at Default, Probability of
Default and Loss Given Default, capped at the
contractually agreed guarantee rate, where
Probability of Default is estimated as a likelihood
of default over the tenure of the loans, Loss
Given Default is an estimate of loss net of
any recoveries and Exposure at Default is the
amount of disbursement made under financial
guarantee contracts.

Financial liabilities

Initial recognition and measurement

Financial liabilities are classified, at initial
recognition, as financial liabilities at fair value
through profit or loss, loans and borrowings,
payables, or as derivatives designated as hedging
instruments in an effective hedge, as appropriate.

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

The Company''s financial liabilities include
borrowings, lease liabilities, trade and other
payables.

Subsequent measurement

The measurement of financial liabilities depends
on their classification as described below:

Loans and borrowings

After initial recognition, interest-bearing loans
and borrowings are subsequently measured at
amortised cost using the EIR method. Gains and
losses are recognised in profit or loss when the
liabilities are derecognised as well as through
the EIR amortisation process.

Amortised cost is calculated by taking into
account any discount or premium on acquisition
and fees or costs that are an integral part of the
EIR. The EIR amortisation is included as finance
costs in the statement of profit and loss.

Derecognition

A financial liability is derecognised when the
obligation under the liability is discharged or

cancelled or expires. When an existing financial
liability is replaced by another from the same
lender on substantially different terms, or the
terms of an existing liability are substantially
modified, such an exchange or modification
is treated as the derecognition of the original
liability and the recognition of a new liability. The
difference in the respective carrying amounts is
recognised in the statement of profit or loss.

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.

m. Cash and cash equivalents

Cash and cash equivalent in the standalone
balance sheet comprise cash at banks and on
hand and short-term deposits with an original
maturity of three months or less, which are
subject to an insignificant risk of changes in value.

For the purpose of the standalone statement of
cash flows, cash and cash equivalents consist of
cash and short-term deposits, as defined above,
net of outstanding bank overdrafts as they are
considered an integral part of the Company''s
cash management.

n. Leases

The Company as a lessee

The Company''s lease asset classes primarily
consist of leases for land and office premises. 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: (i) the contact
involves the use of an identified asset (ii) the
Company has substantially all of the economic
benefits from use of the asset through the period
of the lease and (iii) 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, if any.

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 value-in-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.

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 these 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.

Lease liability and ROU asset have been
separately presented in the standalone balance

sheet and lease payments have been classified
as financing cash flows.

o. Earnings/ (loss) per share (EPS)

Basic EPS amounts are calculated by dividing the
profit/ (loss) 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/ (loss) 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.

p. Segment reporting

Operating segments are reported in a manner
consistent with the internal reporting provided to the
chief operating decision-maker. The Chief Operating
decision-maker is responsible for allocating
resources and assessing performance of the
operating segments and makes strategic decisions.

q. Use of estimates

The Company is required to make estimates and
assumptions that affect the reported amounts
of assets, liabilities, disclosure of contingent
liabilities at the date of the financial statements
and the reported amounts of revenue and
expenses during the reporting period. Actual
results could differ from those estimates. The
Company bases its estimates on historical
experience and on various other assumptions
that are believed to be reasonable, the results
of which form the basis for making judgements
about carrying values of assets and liabilities.

r. Exceptional Items

On certain occasions, the size, type or incidence
of an item of income or expense, pertaining to the
ordinary activities of the Company is such that
its disclosure improves the understanding of the
performance of the Company. Such income or
expense is classified as an exceptional item and
accordingly disclosed in the financial statements.
Significant impact on the financial statements
arising from impairment and non-recurring events
are considered and reported as exceptional items.

---

Mar 31, 2024

i. Provisions and contingencies

Provisions

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, 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.

When the Company expects some or all of a provision to be reimbursed, the reimbursement is recognised as a separate asset, but only when the reimbursement is virtually certain. The expense relating to a provision is presented in the statement of profit and loss net of any reimbursement.

If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.

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. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The Company does not recognize a contingent liability but discloses its existence in the financial statements.

j. Retirement and other employee benefits

For defined benefit plans (gratuity), the liability or asset recognised in the balance sheet is the present value of the defined benefit obligation at the end of the reporting period less the fair value of plan assets. The defined benefit obligation is calculated by an independent actuary using the projected unit credit method.

The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows by reference to market yields at the end of the reporting period on government bonds that have terms approximating to the terms of the related obligation.

The net interest cost is calculated by applying the discount rate to the

net balance of the defined benefit obligation and the fair value of plan assets. This cost is included in employee benefit expense in the statement of profit and loss.

Re-measurement gains and losses arising from experience adjustments and changes in actuarial assumptions are recognised in the period in which they occur, directly in other comprehensive income. They are included in retained earnings in the statement of changes in equity and in the balance sheet. Remeasurements are not reclassified to profit or loss in the subsequent periods.

Changes in the present value of the defined benefit obligation resulting from plan amendments or curtailments are recognised immediately in profit or loss as past service cost.

The Company''s contributions to defined contribution plans (provident fund) are recognized in profit or loss when the employee renders related service. The Company has no further obligations under these plans beyond its periodic contributions.

The Company provides for liability at period end on account of un-availed earned leave and Long Term Incentive Plan (''LTIP'') as per actuarial valuation using projected unit credit method.

Liabilities for wages and salaries, including non-monetary benefits that are expected to be settled wholly within 12 months after the end of the period in which the employees render

the related service are recognised in respect of employees'' services up to the end of the reporting period and are measured at the amounts expected to be paid when the liabilities are settled. The liabilities are presented as employee benefit payable under other financial liabilities in the balance sheet.

The Code on Social Security, 2020 (''Code'') relating to employee benefits during employment and post-employment benefits received Presidential assent in September 2020. The Code has been published in the Gazette of India. Certain sections of the code came into effect on May 3, 2023. However, the final rules/ interpretation have not yet been issued. Based on a preliminary assessment, the entity believes the impact of the change will not be significant.

k. Share-based payments Equity-settled transactions

Employees (including senior executives) of the Company receive remuneration in the form of share-based payments, whereby employees render services as consideration for equity instruments (equity-settled transactions).

The cost of equity-settled transactions is determined by the fair value at the date when the grant is made using an appropriate valuation model.

That cost is recognised, together with a corresponding increase in Employee Stock Option Plan (ESOP) reserves in equity, over the period in which the performance and/or service conditions are fulfilled in employee

benefits expense. The cumulative expense recognised for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Company''s best estimate of the number of equity instruments that will ultimately vest. The statement of profit and loss expense or credit for a period represents the movement in cumulative expense recognised as at the beginning and end of that period and is recognised in employee benefits expense.

Performance conditions which are market conditions are taken into account when determining the grant date fair value of the awards. Service and non-market performance conditions are not taken into account when determining the grant date fair value of awards, but the likelihood of the conditions being met is assessed as part of the Company''s best estimate of the number of equity instruments that will ultimately vest.

No expense is recognised for awards that do not ultimately vest because non-market performance and/or service conditions have not been met.

When the terms of an equity-settled award are modified, the minimum expense recognised is the expense had the terms not been modified, if the original terms of the award are met. An additional expense is recognised for any modification that increases the total fair value of the share-based payment transaction, or is otherwise beneficial to the employee as measured at the date of modification. Where an award is cancelled

by the entity or by the counterparty, any remaining element of the fair value of the award is expensed immediately through profit or loss.

The dilutive effect of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share.

l. 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

Initial recognition and measurement

All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset. However, trade receivables that do not contain a significant financing component are measured at transaction price.

Subsequent measurement

For purposes of subsequent measurement, financial assets are classified in four categories:

• Debt instruments at amortized cost

• Debt instruments at fair value through other comprehensive income (FVTOCI)

• Debt instruments, derivatives and equity instruments at fair value through profit or loss (FVTPL)

• Equity instruments measured at fair value through other comprehensive income (FVTOCI)

Debt instruments at amortised cost

A ''debt instrument'' is measured at the amortised cost if both the following conditions are met:

a) The asset is held within a business model whose objective is to hold assets for collecting contractual cash flows, and

b) Contractual terms of the asset give rise on specified dates to cash flows that are solely payments of principal and interest (SPPI) on the principal amount outstanding.

After initial measurement, such financial assets are subsequently measured at amortised cost using the effective interest rate (EIR) method. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortization is included in finance income in the profit or loss. The losses arising from impairment are recognised in the profit or loss. This category generally applies to trade and other receivables and is most relevant to the Company.

Debt instrument at FVTOCI

A ''debt instrument'' is classified as at the FVTOCI if both of the following criteria are met:

a) The objective of the business model is achieved both by collecting contractual cash flows and selling the financial assets, and

b) The asset''s contractual cash flows represent SPPI.

Debt instruments included within the FVTOCI category are measured initially as well as at each reporting date at fair value. Fair value movements are recognized in the other comprehensive income (OCI). However, the Company recognizes interest income, impairment losses and reversals and foreign exchange gain or loss in the statement of profit and loss. On derecognition of the asset, cumulative gain or loss previously recognised in OCI is reclassified from the equity to the statement of profit and loss. Interest earned whilst holding FVTOCI debt instrument is reported as interest income using the EIR method.

Debt instrument at FVTPL

FVTPL is a residual category for debt instruments. Any debt instrument, which does not meet the criteria for categorization as at amortized cost or as FVTOCI, is classified as at FVTPL.

In addition, the Company may elect to designate a debt instrument, which otherwise meets amortized cost or FVTOCI criteria, as at FVTPL. However, such election is allowed only if doing so reduces or eliminates a measurement or recognition inconsistency (referred to as ''accounting mismatch'').

Debt instruments included within the FVTPL category are measured at fair value with all changes recognized in the statement of profit and loss.

Equity investments

All equity investments in scope of Ind AS 109 are measured at fair value. The Company may make an irrevocable election to present in other comprehensive income subsequent changes in the fair value. The Company makes such election on an instrument-by-instrument basis. The classification is made on initial recognition and is irrevocable.

If the Company decides to classify an equity instrument as at FVTOCI, then all fair value changes on the instrument, excluding dividends, are recognized in the OCI. There is no recycling of the amounts from OCI to statement of profit or loss, even on sale of investment. However, the Company may transfer the cumulative gain or loss within equity.

Equity instruments included within the FVTPL category are measured at fair value with all changes recognized in the statement of profit and loss.

The equity securities which are not held for trading, and for which the Company has made an irrevocable election at initial recognition to recognize changes in fair value through OCI rather than profit or loss as these are strategic investments and the Company considered this to be more relevant.

Equity investments in subsidiaries, associates and joint ventures are measured at cost. The investments are reviewed at each reporting date

to determine whether there is any indication of impairment considering the provisions of Ind AS 36 ''Impairment of Assets'' If any such indication exists, policy for impairment of non-financial assets is followed.

Derecognition

A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognised (i.e. removed from the Company''s balance sheet) when:

• The rights to receive cash flows from the asset have expired, or

• The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ''pass-through'' arrangement; and either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

When the Company has transferred its rights to receive cash flows from an asset or has entered into a passthrough arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognise the transferred asset to the extent of the Company''s continuing

involvement. In that case, the Company also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained.

Impairment of financial assets

In accordance with Ind AS 109, the Company applies expected credit loss (ECL) model for measurement and recognition of impairment loss on financial assets that are debt instruments, and are measured at amortised cost e.g., loans, debt securities, deposits, trade receivables and bank balance.

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

For recognition of impairment loss on other financial assets and risk exposure, the Company determines that whether there has been a significant increase in the credit risk since initial recognition. If credit risk has not increased significantly, 12-month expected credit loss (ECL) is used to provide for impairment loss. However, if credit risk has increased significantly, lifetime ECL is used. If, in a subsequent period, credit quality of the instrument improves such that there is no longer a significant increase in credit risk since initial recognition, then the

entity reverts to recognising impairment loss allowance based on 12-month ECL.

Lifetime ECL are the expected credit losses resulting from all possible default events over the expected life of a financial instrument. The 12-month ECL is a portion of the lifetime ECL which results from default events that are possible within 12 months after the reporting date.

ECL 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 entity expects to receive (i.e., all cash shortfalls), discounted at the original EIR.

The Company uses a provision matrix to determine impairment loss allowance on portfolio of its trade receivables. The provision matrix is based on its historically observed default rates over the expected life of the trade receivables and is adjusted for forward-looking estimates. At every reporting date, the historical observed default rates are updated and changes in the forwardlooking estimates are analyzed.

ECL impairment loss allowance (or reversal) recognized during the period is recognized as income/ expense in the statement of profit and loss. This amount is reflected under the head other expenses in the statement of profit and loss. For the financial assets measured as at amortised cost, ECL is presented as an allowance, i.e., as an integral part of the measurement of those assets in the balance sheet. The

allowance reduces the net carrying amount. Until the asset meets write-off criteria, the Company does not reduce impairment allowance from the gross carrying amount.

Financial liabilities

Initial recognition and measurement

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and borrowings, payables, or as derivatives designated as hedging instruments in an effective hedge, as appropriate.

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

The Company''s financial liabilities include borrowings, lease liabilities, trade and other payables.

Subsequent measurement

The measurement of financial liabilities depends on their classification as described below:

Loans and borrowings

After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the EIR method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortisation process.

Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that

are an integral part of the EIR. The EIR amortisation is included as finance costs in the statement of profit and loss.

Derecognition

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the statement of profit or loss.

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.

m. Cash and cash equivalents

Cash and cash equivalent in the standalone balance sheet comprise cash at banks and on hand and shortterm deposits with an original maturity of three months or less, which are subject to an insignificant risk of changes in value.

For the purpose of the standalone statement of cash flows, cash and cash equivalents consist of cash and short-

term deposits, as defined above, net of outstanding bank overdrafts as they are considered an integral part of the Company''s cash management.

n. Leases

The Company as a lessee

The Company''s lease asset classes primarily consist of leases for land and office premises. 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: (i) the contact involves the use of an identified asset (ii) the Company has substantially all of the economic benefits from use of the asset through the period of the lease and (iii) 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, if any.

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 value-in-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.

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 these 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.

Lease liability and ROU asset have been separately presented in the standalone balance sheet and lease payments have been classified as financing cash flows.

o. Earnings/ (loss) per share (EPS)

Basic EPS amounts are calculated by dividing the profit/ (loss) 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/ (loss) 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.

p. Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The Chief Operating decision-maker is responsible for allocating resources and assessing performance of the operating segments and makes strategic decisions.

q. Use of estimates

The Company is required to make estimates and assumptions that affect the reported amounts of assets, liabilities, disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgements about carrying values of assets and liabilities.

r. Exceptional Items

On certain occasions, the size, type or incidence of an item of income or expense, pertaining to the ordinary activities of the Company is such that its disclosure improves the understanding of the performance of the Company. Such income or expense is classified as an exceptional item and accordingly disclosed in the financial statements. Significant impact on the financial statements arising from impairment and non-recurring events are considered and reported as exceptional items.

Notes:

(i) Capital work in progress (Refer note 3(c))

Capital work in progress mainly comprises of servers and electrical devices. Further, Capital work-in-progress includes expenditure of INR 43 (March 31, 2023: INR 40) relating to expenses incurred on construction of office premises.

(ii) Refer to note 28 (b) for disclosure of contractual commitments for the acquisition of property, plant and equipment.

^A Plant and machinery includes Gross carrying amount INR 15,906 (March 31, 2023: INR 10,460), Accumulated depreciation INR 9,201 (March 31, 2023: INR 4,553), Net carrying amount INR 6,705 (March 31, 2023: INR 5,907) of point-of-sale machines and sound boxes installed at customer''s premise.

3 (b). Leases (Contd..)

The lease term is reassessed if an option is actually exercised (or not exercised) or the Company becomes obliged to exercise (or not exercise) it. The assessment of reasonable certainty is only revised if a significant event or a significant change in circumstances occurs, which affects this assessment, and that is within the control of the lessee. The Company has given notice to vacate certain office premises. This has been accounted as lease termination. Hence, in accordance with Ind AS 116, Lease Liability has been re-measured by INR 204 ( March 31, 2023: 9) with corresponding adjustment to Right of Use assets amounting to INR 185 (March 31, 2023: 8) and the remaining balance has been included in Miscellaneous Income disclosed under Other Income in the Statement of Profit and Loss.

The total cash outflow for leases for the year ended is INR 440 (March 31, 2023: 554) Extension and termination options:

Extension and termination options are included in certain leases. These are used to maximise operational flexibility in terms of managing the assets used in the Company''s operations. In certain cases, the extension and termination options held are exercisable only by the Company and not by the respective lessor.

7(c) Loans (Contd..)

No loans or advances are recoverable from directors or other officers of the Company either severally or jointly with any other person. Nor any loans or advances are recoverable from firms or private companies respectively in which any director is a partner, a director or a member.

## Loan of INR 803, INR 402 and INR 408 has been given to First Games Technology Private Limited (formerly known as Paytm First Games Private Limited) on June 7, 2021, September 30, 2021 and January 27, 2022 respectively. The Company has the rights of conversion into a variable number of shares in First Games Technology Private Limited (formerly known as Paytm First Games Private Limited) (Joint venture of Paytm Entertainment Limited, wholly owned subsidiary) at fair market value and with mutual consent, during the tenure of loan. The interest is payable at the end of the repayment period. The loan has been fair valued through profit and loss (FVTPL) since it does not meet the SPPI test.

The Company has not granted loans to its directors and KMPs and the related parties (as defined under Companies Act, 2013) without specifying any terms or period of repayment. In certain cases, the Company has the right to demand for payment before specified period.

10(a). Cash and cash equivalents (Contd..)

(c) Balance with banks on current accounts includes balance of Initial Public Offer (IPO) proceeds of INR 10,000 (March 31, 2023: INR 10,007) which will be utilised as stated in the prospectus for IPO.

(d) Fixed deposits amounting to INR 2,500 and INR 518 (March 31, 2023: INR Nil and INR 31,000) included in note 7(d) and 10(b), respectively, will be utilised as stated in the prospectus for IPO.

(e) Certificate of deposits amounting to INR 6,982 (March 31, 2023: INR Nil) included in note 7(a) will be utilised as stated in the prospectus for IPO.

c. Shares reserved for issue under options

For details of shares reserved for issue under the employee stock options plan (ESOP) of the Company (Refer note 24).

d. Aggregate number of bonus shares issued, shares bought back and share issued for consideration other than cash during the period of five years immediately preceding the reporting date:

The Company has not issued any share for consideration other than cash during the period of five years immediately preceding the reporting date. The Company has not issued bonus shares during the period of five years immediately preceding the reporting date. The Company has bought back 15,566,746 shares during the period of five years immediately preceding the reporting date. (Refer note 39)

Nature and purpose of reserves

(i) Securities premium

Securities premium is used to record the premium on issue of shares. The reserve is utilised in accordance with the provisions of the Act.

(ii) Employee stock options outstanding account (ESOP Reserve)

Employee stock options outstanding account is used to recognise the grant date fair value of options issued to employees under the One 97 Employee Stock Option Plan.

(iii) FVTOCI Reserve

The Company has elected to recognise changes in the fair values of the certain investments in equity instruments in other comprehensive income. These changes are accumulated within the FVTOCI reserve within equity. The Company transfers amounts from this reserve to retained earning when relevant equity securities are derecognised.

(iv) Capital Redemption Reserve

As per Companies Act, 2013, capital redemption reserve is created when company purchases its own shares out of free reserves or securities premium. A sum equal to the nominal value of the shares so purchased is transferred to capital redemption reserve. The reserve is utilised in accordance with the provisions of section 69 of the Companies Act, 2013.

*The Company uses a Nodal Account to receive money through debit/credit card and net banking transactions towards all transactions occurring on its portal, as well as to settle the respective merchants. The amounts collected but yet to be transferred to merchants are netted off with nodal account having balance of INR 15,537 (March 31, 2023 : INR 8,533). Gross payable to merchant includes payable to related parties (refer note 25) INR 428 (March 31, 2023 : INR 2,681).

Terms and conditions of the above financial liabilities:

(i) Trade and other payables are non-interest bearing and generally carry credit period of 30-45 days. Note: All financial liabilities are carried at amortized cost

(ii) Legal and professional fees includes

a) an amount of INR 75 (March 31, 2023 : INR 74) as remuneration to non-executive and independent directors.

b) an amount of INR Nil (March 31, 2023 : INR 21) as payment to a Law firm in which one of the non-executive and independent director is interested. Further, payment of INR Nil (March 31, 2023: INR 4) to the said firm which is in the nature of share issue expenses/ share buyback expenses (transaction cost) has been adjusted with securities premium account.

a) As at March 31, 2024, the Company had balances recoverable of INR 139 from Go Airlines (India) Limited ("Go Air") towards business related advances given and other dues. After considering recoveries and adjustments in the normal course of business during the year, the recoverable balance stands at INR 57 as on date. On May 10, 2023, the National Company Law Tribunal, Delhi Bench (''NCLT'') admitted Go Air''s application for voluntary insolvency proceedings under the Insolvency and Bankruptcy Code 2016, and NCLT has also appointed an Insolvency Resolution Professional (IRP) to revive the airline and manage its operations. As at date, the sale of tickets has been suspended and flights are yet to resume for Go Air. As part of the claims process,

21. Exceptional items (Contd..)

on May 24, 2023, the Company has filed a claim with the IRP for recovery of outstanding balances. Pending outcome of the insolvency proceedings, the management has provided for the balance INR 57 as exceptional item in the Standalone Statement of Profit and Loss.

b) During the Current year ended March 31, 2024, the Company has recognized provision for impairment in the carrying value of its investment in its associate, Infinity Transoft Solutions Private Limited of INR 20 and during the previous year March 31, 2023, in carrying value of its investments in its subsidiaries, Orbgen Technologies Private Limited, Paytm Insurance Broking Private Limited and Little Internet Private Limited of INR 104, INR 525 and INR 1 respectively. The provision for impairment has been shown as an exceptional item in the Standalone Statement of Profit and Loss. During the current and previous years, the impairment losses for these investments was based on the equity value calculated based on cash flow projections with the business plan used for impairment testing using discounted cash flow method. The management has computed equity value based on discount rate of 20.8% (March 31, 2023: 22.5%) and terminal growth rate used in extrapolating cash flows beyond the planning period of 2.45 (March 31, 2023: 2.45) times of revenue of the terminal year.

22. Earnings per shares (EPS)

Basic EPS amounts are calculated by dividing the profit/ (loss) for the year attributable to equity holders of the Company by the weighted average number of equity shares outstanding during the year. Diluted EPS amounts are calculated by dividing the profit/ (loss) for the year attributable to equity holders of the Company 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.

23. Significant accounting judgements, estimates and assumptions

The preparation of the Company''s Standalone 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.

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 12 months, are described below.

Deferred taxes

Deferred tax assets can be recognised for deductible temporary differences (including unused tax losses) only to the extent that it is probable that taxable profit will be available against which the deductible temporary difference can be utilised. As the Company is yet to generate operating profits, Management has assessed that as at March 31, 2024 it is not probable that such deferred tax assets can be realised in excess of available taxable temporary differences. Management reassesses unrecognised deferred tax assets at each reporting date and recognises to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered. For details about deferred tax assets, refer note 27.

During FY 2019-20 (AY 2020-21) a shareholder of the Company holding 30.33% of shares of the Company had transferred its shareholding to its group company (both entities being 100% subsidiaries of the same ultimate parent entity). Based on advice from the Company''s tax experts, Management has assessed that a mere change in shareholding within the same group will not be an affirmative position to say that the shareholding has been changed. Further, since the shares of the Company carrying not less than fifty-one percent of the voting power were beneficially held by persons, i.e. ultimate holding company of the aforesaid entities, who beneficially held shares of the company carrying not less than fifty-one percent of the voting power on the last day of the year or years in which the loss was incurred, the Company shall be entitled to carry forward and set off these losses against the taxable income of future years in accordance with the provisions of Section 79 of the Income Tax Act, 1961. (Refer note 27)

Defined benefit plans (gratuity benefits)

The cost of the defined benefit gratuity plan and the present value of the gratuity 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.

In determining the appropriate discount rate for plans operated in India, the management considers the interest rates of government bonds in India. The mortality rate is based on publicly available mortality tables for India. The mortality tables tend to change only at interval in response to demographic changes. Future salary increases and gratuity increases are based on expected future inflation rates. For further details about gratuity obligations, refer note 26.

Fair value measurement of financial instruments

When the fair values of financial assets and financial liabilities recorded in the standalone balance sheet cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques including the DCF model, Price of Recent Investment (PORI) method and Comparable Company Multiples (CCM) method. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair values. For further details about Fair value measurement, refer note 30.

Impairment of financial assets

The Company assesses on a forward looking basis the expected credit risk associated with its assets carried at amortised cost. The impairment methodology applied depends on whether there has been a significant increase in credit risk. Note 31 details how the Company determines whether there has been a significant increase in credit risk.

Impairment reviews

Investments in subsidiaries and associates are tested for impairment at-least on an annual basis or when events that occur / changes in circumstances indicate that the recoverable amount is less than its carrying value. In calculating the value in use, the Company is required to make judgements, estimates and assumptions inter-alia concerning the growth in EBITDA, long-term growth rates; discount rates to reflect the risks involved. The carrying value is less than the net worth of certain subsidiaries. The Company basis the underlying business and future business projections, does not consider there to be any diminution in the value of such investments. For details about impairment reviews, refer note 21.

The Company has investment in PPBL, an associate. During the year, given certain developments, the Company has recorded impairment of 100% carrying value. A qualitative assessment requires significant judgement (refer note 41)

Incentives

The Company provides incentives to users in various forms including cash backs to promote our platform. Incentives to users to whom the Company has a performance obligation is recorded as a reduction of revenue to the extent of the revenue earned. For the incentives to other transacting users to whom the Company has no performance obligation, management is required to determine whether the incentives are in substance a payment on behalf of the merchants and should therefore be recorded as a reduction of revenue or as marketing and promotional expenses. Some of the factors considered in management''s evaluation of such incentives being payments on behalf of merchants include whether the incentives are given at the Company''s discretion, contractual agreements with the merchants, business strategy and objectives and design of the incentive program(s), etc.

Share-based payments

Employees of the Company receive remuneration in the form of share based payment instruments, whereby employees render services to group and receive equity instrument of Holding Company as consideration (equity-settled transactions). In accordance with the Ind AS 102 Share Based Payments, the cost of equity-settled transactions is measured using the fair value method. The cumulative expense recognized for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the company''s best estimate of the number of equity instruments that will ultimately vest.

24. Employee Stock Option Schemes (ESOP)

(A) One 97 Employees Stock Option Scheme 2019 (ESOP 2019 Scheme)

The Company introduced One97 Employee Stock Option Scheme 2019 for the benefit of employees as approved by the Board of Directors in the meeting held on September 4, 2019 and by shareholders in the Annual General Meeting held on September 30, 2019 wherein the Nomination and Remuneration Committee has been authorized to grant share-based stock options to eligible employees of the Company, its subsidiaries and associates under the ESOP 2019 Scheme. The maximum number of Employee Stock Options under ESOP 2019 Scheme shall not exceed 46,455,832 equity shares. ESOPs are generally granted to high performing employees. These Stock Options will generally vest between a minimum of one to a maximum of five years from the grant date subject to achievement of certain performance criteria e.g. impact made on overall business, track record of displaying Paytm values, etc.

(B) One 97 Employees Stock Option Scheme 2008 (ESOP 2008 Scheme)

The Company introduced One 97 Employee Stock Option 2008 Scheme for the benefit of employees as approved by the Board of Directors in the meeting held on September 8, 2008 and by the members in the Extra Ordinary General Meeting held on October 22, 2008 wherein Nomination and Remuneration Committee has authorized to grant share-based stock options to eligible employees of the Company and its subsidiaries under the ESOP 2008 Scheme. The maximum number of Employee Stock Options under ESOP 2008 Scheme shall not exceed

24. Employee Stock Option Schemes (ESOP) (Contd..)

14,638,448 equity shares. These instruments will generally vest between a minimum of one to a maximum of four years from the grant date. The Company doesn''t intent to make any grant under this scheme post Initial Public offering.

(C)Details about employee stock options granted, outstanding and other information:

(1) During the year ended March 31, 2024, the Company has granted 7,407,606 (March 31, 2023- 12,385,196) Employee Stock Options under ESOP 2019 Scheme to Eligible Employees.

(2) The total options outstanding as at March 31, 2024 under ESOP 2008 Scheme are 68,717 and ESOP 2019 Scheme are 38,115,349 (March 31, 2023 under ESOP 2008 Scheme -250,797 and ESOP 2019 Scheme - 37,457,727). Scheme-wise options outstanding are as under:

(8) Other Details

(a) During FY 2023-24, the Company has cancelled 760,538 outstanding unvested employee stock options and 80,214 vested options. The same has resulted into accelerated ESOP charge of INR 304 which has been recorded as investment in respective associate entity.

During FY 2022-23, the Company has cancelled 20,499 outstanding unvested employee stock options. This cancellation of unvested employee stock options resulted into an accelerated share based payment expense of INR 12 (included in above charge) in the Standalone Statement of Profit and Loss for the year ended March 31, 2023.

(b) During the current year, the Company has modified the terms of certain ESOPs by adding certain performance conditions and modifying other vesting conditions. Accordingly, the Company has computed the incremental fair value of options as the difference between the fair value of the modified ESOP and that of the original ESOP, using Monte Carlo Simulations method as at the date of the modification which has been amortised in the Statement of Profit and Loss over the revised vesting period and accordingly charge of INR 262 (out of the INR 1,378 incremental fair value) recorded during the year.

Terms and conditions of transactions with related parties

(i) The services provided and received 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 (except for inter corporate loan receivable and optionally convertible debentures) and settlement generally occurs in cash. There have been no guarantees provided or received for any related party receivables or payables.

(ii) The remuneration to the key managerial personnel (''KMP'') does not include the provisions made for gratuity, leave benefits and long term incentive plan as they are determined on an actuarial basis for the Company as a whole.

(iii) The Company has agreed to provide appropriate financial support only if and to the extent required by certain of its subsidiaries and joint venture.

(iv) Refer note 20 for details of remuneration to non-excecutive and independent directors and payment to a law firm in which one of the non-executive and independent director is interested

26. Gratuity

The Company provides for gratuity for employees in India as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service upto a limit of INR 20 Lakhs. The gratuity plan is a funded plan and the Company makes contributions to recognised fund/insurer in India. The Company does not fully fund the liability and maintains a target level of funding to be maintained over a period of time based on estimations of expected gratuity payments. Disclosures given below are as per actuarial valuation report of independent Actuary.

The following tables summarize the components of net benefit expenses recognized in the Standalone Statement of Profit and Loss and the funded status and amount recognized in the Standalone Balance Sheet.

Risk exposure

Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which are detailed below:

Asset volatility: The plan assets are calculated using a discount rate set with reference to bond yields. If plan assets underperform this yield, there will be a deficit of the plan asset investments in fixed income securities with high grades and in government securities. These are subject to interest rate risk and the fund manages interest rate risk to an acceptable level.

Changes in bond yields: The defined benefit obligation calculated uses a discount rate based on government bonds. If bond yields fall, the defined benefit obligation will tend to increase.

Inflation risks: The payments are not linked to inflation, so this is a less material risk.

Life expectancy: Obligations are to provide benefits for the life of the member, so increases in life expectancy and inflation will result in an increase in the plans'' liabilities. This is particularly significant where inflationary conditions result in higher sensitivity to changes in life expectancy.

28. Commitments and contingencies

a. Leases

Operating lease: Company as Lessee

The Company has taken certain office space on short term operating lease. The leases have varying terms, escalation clauses and renewal rights. On renewal, the terms of the leases are renegotiated. Rental expense towards leases charged to Standalone Statement of Profit and Loss for the year ended March 31, 2024 amount to INR 8 (March 31, 2023: INR 5).

b. Capital commitments

Estimated amount of contracts towards property, plant & equipment remaining to be executed on capital account and not provided for is INR 1,325 (Net of capital advances of INR 563) [March 31, 2023: INR 2,586 (Net of capital advances of INR 566)].

28. Commitments and contingencies (Contd..)

ii) The Company will continue to assess the impact of further developments relating to retrospective application of Supreme Court judgement dated February 28, 2019 clarifying the definition of ''basic wages'' under Employees'' Provident Fund and Miscellaneous Provisions Act 1952 and deal with it accordingly. In the assessment of the management, the aforesaid matter is not likely to have a significant impact and accordingly, no provision has been made in these Standalone Financial Statements.

Notes:

1) It is not practicable for the Company to estimate the timing of cash outflows, if any.

2) The Company does not expect any reimbursements in respect of the above contingent liabilities.

30. Fair value

Fair value hierarchy

The following table provides the fair value measurement hierarchy of the Company''s assets and liabilities:

Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3 - Inputs for the assets or liabilities that are not based on observable market data (unobservable inputs).

30. Fair value (Contd..)

The management has assessed that fair value of all other financial assets and liabilities including cash and cash equivalents, bank balances other than cash and cash equivalents, other investments, trade receivables, loans, other financial assets, trade payables, lease liabilities and other financial liabilities, approximate their carrying amounts.

Description of significant unobservable inputs to valuation of material investments:

The significant unobservable inputs used in the material fair value measurement categorised within Level 3 of the fair value hierarchy together with a quantitative sensitivity analysis as at 31 March 2024 and 31 March 2023 are as below:

31. Financial risk management objectives and policies

The Company''s activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk. The Company continues to focus on a system-based approach to business risk management. The Company''s financial risk management process seeks to enable the early identification, evaluation and effective management of key risks facing the business. Backed by strong internal control systems, the current Risk Management Framework rests on policies and procedures issued by appropriate authorities; process of regular internal reviews/audits to set appropriate risk limits and controls; monitoring of such risks and compliance confirmation for the same.

31. Financial risk management objectives and policies (Contd..)

a. 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 prices comprise three types of risk: interest rate risk, foreign currency risk and price risk. The Company has in place appropriate risk management policies to limit the impact of these risks on its financial performance. The Company ensures optimization of cash through fund planning and robust cash management practices.

(i) Interest Rate Risk

Interest rate risk refers to the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. There is no interest rate risk as the Company did not have borrowings at the end of the current and previous year.

(ii) Price risk

The Company invests its surplus funds in fixed deposits, Commercial papers, Treasury bills, Government Securities, Certificate of deposits and non-convertible debentures. There is no exposure of price risk on such instruments.

The Company is also exposed to equity/ preference shares price risk arising from investments held by the Company and classified in the balance sheet either as fair value through OCI or at fair value through profit or loss (refer note 7(a) and 7(b)). To manage its price risk arising from investments in equity/ preference shares, the company diversifies its portfolio. Diversification of the portfolio is done in accordance with the limits set by the company.

(iii) Foreign currency risk

The Indian Rupee is the Company''s most significant currency. As a consequence, the Company''s results are presented in Indian Rupee and exposures are managed against Indian Rupee accordingly. 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 and investing activities (when revenue, expense and Property, Plant and Equipment is denominated in a foreign currency).

b. Credit Risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) including deposits with banks. Management has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis. The Company applies expected credit loss (ECL) model on financial assets measured at amortised cost e.g., loans, debt securities, deposits, trade receivables and bank balance. Cash and cash equivalents are also subject to the impairment requirement of Ind AS 109, the identified impairment loss was immaterial.

All of the entity''s investments and loans at amortised cost are considered to have low credit risk, and the loss allowance recognised during the period was therefore limited to 12 months expected losses. Management considers instruments to be low credit risk when they have a low risk of default and the issuer has a strong capacity to meet its contractual cash flow obligations in the near term.

(i) Trade receivables

The Company is exposed to credit risk in the event of non-payment by customers. Customer credit risk is managed 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 by grouping the receivables in homogeneous group. The calculation is based on lifetime expected credit losses.

(ii) Other investments (excluding loans to related parties)

All of the entity''s other investments (preference shares, government securities, commercial papers, treasury bills and security deposits) at amortised cost are considered to have low credit risk, and the loss allowance recognised during the period was therefore limited to 12 months'' expected losses. Management consider ''low credit risk'' for listed instruments to be an investment grade credit rating with at least one major rating agency. Other instruments are considered to have low credit risk when they have a low risk of defau

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Mar 31, 2023

The lease term is reassessed if an option is actually exercised (or not exercised) or the Company becomes obliged to exercise (or not exercise) it. The assessment of reasonable certainty is only revised if a significant event or a significant change in circumstances occurs, which affects this assessment, and that is within the control of the lessee. The Company has given notice to vacate certain office premises. This has been accounted as lease termination. Hence, in accordance with Ind AS 116, Lease Liability has been re-measured by INR 9 ( March 31, 2022: 9) with corresponding adjustment to Right-of-Use assets amounting to INR 8 (March 31, 2022: 6) and the remaining balance has been included in Miscellaneous Income disclosed under Other Income in the Statement of Profit and Loss.

The total cash outflow for leases for the year ended is INR 554 (March 31, 2022: 314) Extension and termination options:

Extension and termination options are included in certain leases. These are used to maximise operational flexibility in terms of managing the assets used in the Company''s operations. In certain cases, the extension and termination options held are exercisable only by the Company and not by the respective lessor.

#Inter corporate loans are given after complying with the provisions of section 186 of the Companies Act, 2013. The loans have been given in accordance with terms and conditions of the underlying agreements. Outstanding loans carry interest rate in the range of 8% to 12% (March 31, 2022 : 5.10% to 12%).

No loans or advances are recoverable from directors or other officers of the Company either severally or jointly with any other person. Nor any loans or advances are recoverable from firms or private companies respectively in which any director is a partner, a director or a member, except as disclosed in note 25.

## Loan of INR 803, INR 402 and INR 408 has been given to First Games Technology Private Limited (formerly known as Paytm First Games Private Limited) on June 7, 2021, September 30, 2021 and January 27, 2022 respectively. The Company has the rights of conversion into a variable number of shares in First Games Technology Private Limited (formerly known as Paytm First Games Private Limited)

(a) There are no repatriation restrictions with regard to cash and cash equivalents as at the end of the reporting period and prior period.

(b) Fixed deposits amounting to INR 2,081 (March 31, 2022: INR 32) included in note 7(d) and 10(b) are marked under lien by banks for providing bank overdraft, working capital demand loan and issuing bank guarantees under various contracts.

(c) Balance with banks on current accounts includes balance of Initial Public Offer (IPO) proceeds of INR 10,007 (March 31, 2022: 736) which will be utilised as stated in the prospectus for IPO.

(d) Fixed deposits amounting to INR 31,000 (March 31, 2022: 70,900) included in note 7(d) and 10(b) will be utilised as stated in the prospectus for IPO.

Terms/ rights attached to equity shares

All the equity shares issued shall rank pari passu and have a par value of INR 1 per share. Each shareholder is eligible for one vote per share held only.

#Pursuant to the approval of the shareholders at the Annual General Meeting of the Company held on June 30, 2021, each equity share of face value of INR 10 per share was sub-divided into ten equity shares of face value of INR 1 per share, with effect from the record date, i.e., June 30, 2021.

d. Aggregate number of bonus shares issued, shares bought back and share issued for consideration other than cash during the period of five years immediately preceding the reporting date:

The Company has issued 333,035 shares for consideration other than cash during the period of five years immediately preceding the reporting date. The Company has not issued bonus shares during the period of five years immediately preceding the reporting date. The Company has bought back 15,566,746 shares during the period of five years immediately preceding the reporting date.

Nature and purpose of reserves

(i) Securities premium

Securities premium is used to record the premium on issue of shares. The reserve is utilised in accordance with the provisions of the Act.

(ii) Employee stock options outstanding account (ESOP Reserve)

Employee stock options outstanding account is used to recognise the grant date fair value of options issued to employees under the One 97 Employee Stock Option Plan.

(iii) FVTOCI Reserve

The Company has elected to recognise changes in the fair values of the certain investments in equity instruments in other comprehensive income. These changes are accumulated within the FVTOCI reserve within equity. The Company transfers amounts from this reserve to retained earning when relevant equity securities are derecognised.

(iv) Capital Redemption Reserve

As per Companies Act, 2013, capital redemption reserve is created when company purchases its own shares out of free reserves or securities premium. A sum equal to the nominal value of the shares so purchased is transferred to capital redemption reserve. The reserve is utilised in accordance with the provisions of section 69 of the Companies Act, 2013.

(ii) Legal and professional fees includes

a) an amount of INR 74 (March 31, 2022 : INR 59) as remuneration to non-executive and independent directors.

b) an amount of INR 21 (March 31, 2022 : INR 49) as payment to a Law firm in which one of the non-executive and independent director is interested. Further, payment of INR 4 (March 31, 2022: INR 1) to the said firm which is in the nature of share issue expenses/ share buy-back expenses (transaction cost) has been adjusted with securities premium account.

a) The Company basis its assessment of future business projections of its subsidiaries i.e. Orbgen Technologies Private Limited, Paytm Insurance Broking Private Limited, Wasteland Entertainment Private Limited and Little Internet Private Limited has recognized provision for impairment in the carrying value of its investments of INR 104, INR 525, INR Nil and INR 1 (March 31, 2022 : INR 132, INR Nil, INR 200 and INR Nil), respectively, which has been shown as exceptional item in the Standalone Statement of Profit and Loss for the year ended March 31, 2023. During current and previous year, the impairment loss for these investments was based on the equity value calculated based on cash flow projections with the business plan used for impairment testing using discounted cash flow method. The management has computed equity value based on discount rate of 22.5% (March 31, 2022: 22.5%) and terminal growth rate used in extrapolating cash flows beyond the planning period of 2.45 (March 31, 2022: 2.45) times of revenue of the terminal year.

b) The Company basis its assessment of future business projections of its associate, Eatgood Technologies Private Limited, has recognized provision of INR Nil (March 31, 2022: INR 30) for impairment in the carrying value of its investment. During current and previous year, the management has computed equity value for the investment based on discount rate of 17.24% (March 31, 2022:17.24%) and terminal growth rate used in extrapolating cash flows is 3.8% (March 31, 2022: 3.8%).

c) During the previous year, the Company had subscribed to optionally convertible debentures of Nearbuy India Private Limited (subsidiary of Little Internet Private Limited). The Company has the rights of conversion into a fixed number of equity shares. The investment has been fair valued through profit and loss (FVTPL) since it does not meet the SPPI test. The difference in fair value of INR 79 has been taken as deemed investment in Little Internet Private Limited. The Company basis its assessment of future business projections has recognized an impairment of INR 79.

22. Earnings per shares (EPS)

Basic EPS amounts are calculated by dividing the profit/ (loss) for the year attributable to equity holders of the Company by the weighted average number of equity shares outstanding during the year. Diluted EPS amounts are calculated by dividing the profit/ (loss) attributable to equity holders of the Company 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.

23. Significant accounting judgements, estimates and assumptions

The preparation of the Company''s Standalone 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.

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 12 months, are described below.

Deferred taxes

Deferred tax assets can be recognised for deductible temporary differences (including unused tax losses) only to the extent that it is probable that taxable profit will be available against which the deductible temporary difference can be utilised. As the Company is yet to generate operating profits, Management has assessed that as at March 31, 2023 it is not probable that such deferred tax assets can be realised in excess of available taxable temporary differences. Management reassesses unrecognised deferred tax assets at each reporting date and recognises to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered. For details about deferred tax assets, refer note 27.

During FY 2019-20 (AY 2020-21) a shareholder of the Company holding 30.33% of shares of the Company had transferred its shareholding to its group company (both entities being 100% subsidiaries of the same ultimate parent entity). Based on advice from the Company''s tax experts, Management has assessed that a mere change in shareholding within the same group will not be an affirmative position to say that the shareholding has been changed. Further, since the shares of the Company carrying not less than fifty-one percent of the voting power were beneficially held by persons, i.e. ultimate holding company of the aforesaid entities, who beneficially held shares of the company carrying not less than fifty-one percent of the voting power on the last day of the year or years in which the loss was incurred, the Company shall be entitled to carry forward and set off these losses against the taxable income of future years in accordance with the provisions of Section 79 of the Income Tax Act, 1961. (refer note 27)

Defined benefit plans (gratuity benefits)

The cost of the defined benefit gratuity plan and the present value of the gratuity 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.

In determining the appropriate discount rate for plans operated in India, the management considers the interest rates of government bonds in India. The mortality rate is based on publicly available mortality tables for India. The mortality tables tend to change only at interval in response to demographic changes. Future salary increases and gratuity increases are based on expected future inflation rates. For further details about gratuity obligations, refer note 26.

Fair value measurement of financial instruments

When the fair values of financial assets and financial liabilities recorded in the standalone balance sheet cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques including the DCF model, Price of Recent Investment (PORI) method and Comparable Company Multiples (CCM) method. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair values. For further details about Fair value measurement, refer note 30.

Impairment of financial assets

The Company assesses on a forward looking basis the expected credit risk associated with its assets carried at amortised cost. The impairment methodology applied depends on whether there has been a significant increase in credit risk. Note 31 details how the Company determines whether there has been a significant increase in credit risk.

Impairment reviews

Investments in subsidiaries and associates are tested for impairment at-least on an annual basis or when events that occur / changes in circumstances indicate that the recoverable amount is less than its carrying value. In calculating the value in use, the Company is required to make judgements, estimates and assumptions inter-alia concerning the growth in EBITDA, long-term growth rates; discount rates to reflect the risks involved. For details about impairment reviews, refer note 21.

Incentives

The Company provides incentives to users in various forms including cash backs to promote our platform. Incentives to users to whom the Company has a performance obligation is recorded as a reduction of revenue to the extent of the revenue earned. For the incentives to other transacting users to whom the Company has no performance obligation, management is required to determine whether the incentives are in substance a payment on behalf of the merchants and should therefore be recorded as a reduction of revenue or as marketing and promotional expenses. Some of the factors considered in management''s evaluation of such incentives being payments on behalf of merchants include whether the incentives are given at the Company''s discretion, contractual agreements with the merchants, business strategy and objectives and design of the incentive program(s), etc

24. Employee Stock Option Schemes (ESOP)

(A) One97 Employees Stock Option Scheme 2019 (ESOP 2019 Scheme)

The Company introduced One97 Employee Stock Option Scheme 2019 for the benefit of employees as approved by the Board of Directors in the meeting held on September 4, 2019 and by shareholders in the Annual General Meeting held on September 30, 2019 wherein the Nomination and Remuneration Committee has been authorized to grant share-based stock options to eligible employees of the Company, its subsidiaries and associates under the ESOP 2019 Scheme. The maximum number of Employee Stock Options under ESOP 2019 Scheme shall not exceed 46,455,832* (Refer Note 1 & 2 below) equity shares. ESOPs are generally granted to high performing employees. These Stock Options will generally vest between a minimum of one to a maximum of five years from the grant date subject to achievement of certain performance criteria e.g. impact made on overall business, track record of displaying Paytm values, etc.

*After considering impact of share sub division

Significant changes/modifications in the ESOP 2019 Scheme during FY 202122 & FY 2022-23

1) Pursuant to the approval of Shareholders of the Company at the Annual General Meeting held on June 30, 2021, each equity share of the Company having face value of INR 10 each was sub divided into ten equity shares of face value of INR 1 per share with effect from June 30, 2021. Accordingly, all outstanding Employee Stock Options and remaining Employee Stock Option Pool have also been sub divided in the similar proportion.

2) Shareholders of the Company in the Extra Ordinary General Meeting held on September 2,

2021 has approved increase in ESOP Pool by adding 37,000,000 options. Accordingly, total ESOP Pool for ESOP 2019 Scheme stands at 46,455,832.

3) Post Initial Public Offering of the Company''s share, the scheme has been ratified on February 19,

2022 by the shareholders through postal ballot to comply with SEBI (SBEB & SE) Regulations. Further, Scheme has also been extended to cover the employees of group companies.

The Company introduced One 97 Employee Stock Option 2008 Scheme for the benefit of employees as approved by the Board of Directors in the meeting held on September 8, 2008 and by the members in the Extra Ordinary General Meeting held on October 22, 2008 wherein Nomination and Remuneration Committee has authorized to grant share-based stock options to eligible employees of the Company and its subsidiaries under the ESOP 2008 Scheme. The maximum number of Employee Stock Options under ESOP 2008 Scheme shall not exceed 14,638,448* equity shares. These instruments will generally vest between a minimum of one to a maximum of four years from the grant date.

*After considering impact of share sub division

(C)Details about employee stock options granted, outstanding and other information:

1) During the year ended March 31, 2023, the Company has granted 12,385,196 (March 31, 2022- 27,428,285) Employee Stock Options under ESOP 2019 Scheme to Eligible Employees.

The grant made during FY 2021-22 includes grant of 21,000,000 Employee Stock Options to Managing Director and CEO of the Company which is subject to achievement of certain milestones and will vest equally in 4 tranches, having minimum vesting period of 24 months, 36 months, 48 months and 60 months for each tranche respectively.

During FY 2022-23, the Company has cancelled 20,499 outstanding unvested employee stock options. This cancellation of unvested employee stock options resulted into an accelerated share based payment expense of INR12 (included in above charge) in the Standalone Statement of Profit and Loss for the year ended March 31, 2023.

During FY 2021-22, the Company had cancelled 67,550¹ outstanding unvested employee stock options and 68,830¹ outstanding vested employee stock options. This cancellation of unvested employee stock options resulted into an accelerated share based payment expense of INR 39 (included in above charge) in the Standalone Statement of Profit and Loss for the year ended March 31, 2022.

1. Weighted average share price is based on the value of Equity Shares arrived at by using Discounted Cash Flow Method, OPM Method or Backsolve method and share prices based on secondary transactions, where available.

2. Dividend yield is considered zero, as no dividend payout is expected in the foreseeable future.

3. Risk free return is based on the yield to maturity of Indian treasury securities, with a maturity corresponding to the expected term of ESOP.

4. Annualized volatility is based on the median weekly volatility of selected comparable companies for a time period commensurate with the expected term.

Terms and conditions of transactions with related parties

(i) The services provided and received 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 (except for inter corporate loan receivable and optionally convertible debentures) and settlement generally occurs in cash. There have been no guarantees provided or received for any related party receivables or payables.

(ii) The remuneration to the key managerial personnel (''KMP'') does not include the provisions made for gratuity, leave benefits and long term incentive plan as they are determined on an actuarial basis for the Company as a whole.

(iii) The Company has agreed to provide appropriate financial support only if and to the extent required by certain of its subsidiaries and joint venture.

(iv) Refer note 20 for details of remuneration to non-executive and independent directors and payment to a law firm in which one of the non-executive and independent director is interested

26. Gratuity

The Company provides for gratuity for employees in India as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service upto a limit of INR 20 Lakhs. The gratuity plan is a funded plan and the Company makes contributions to recognised fund/insurer in India. The Company does not fully fund the liability and maintains a target level of funding to be maintained over a period of time based on estimations of expected gratuity payments. Disclosures given below are as per actuarial valuation report of independent Actuary.

The following tables summarize the components of net benefit expenses recognized in the Standalone Statement of Profit and Loss and the funded status and amount recognized in the Standalone Balance Sheet.

The sensitivity analysis above have been determined based on a method that extrapolates the impact on defined benefit obligation as a result of reasonable changes in key assumptions occurring at the end of the reporting period. The methods and types of assumptions used in preparing the sensivity analysis did not change compared to the prior year.

Expected contributions to post-employment benefit plans for the period ending March 31, 2024 are INR 254 (March 31, 2023 - INR 162).

The weighted average duration of the defined benefit obligation is 2.79 years (March 31, 20222.78 years).

The average remaining working life of members of the defined benefit obligation as at March 31, 2023 is 30.87 years (as at March 31, 2022- 29.91 years)

Risk exposure

Through its defined benefit plans, the Company is exposed to a number of risks, the most significant of which are detailed below:

Asset volatility: The plan assets are calculated using a discount rate set with reference to bond yields. If plan assets underperform this yield, there will be a deficit of the plan asset investments in fixed income securities with high grades and in government securities. These are subject to interest rate risk and the fund manages interest rate risk to an acceptable level.

Changes in bond yields: The defined benefit obligation calculated uses a discount rate based on government bonds. If bond yields fall, the defined benefit obligation will tend to increase.

Inflation risks: The payments are not linked to inflation, so this is a less material risk.

Life expectancy: Obligations are to provide benefits for the life of the member, so increases in life expectancy and inflation will result in an increase in the plans'' liabilities. This is particularly significant where inflationary conditions result in higher sensitivity to changes in life expectancy.

28. Commitments and contingencies

a. Leases

Operating lease: Company as Lessee

The Company has taken certain office space on short term operating lease. The leases have varying terms, escalation clauses and renewal rights. On renewal, the terms of the leases are renegotiated. Rental expense towards leases charged to Standalone Statement of Profit and Loss for the year ended March 31, 2023 amount to INR 5 (March 31, 2022: INR 42).

b. Capital commitments

Estimated amount of contracts towards property, plant & equipment remaining to be executed on capital account and not provided for is INR 2,586 (Net of capital advance of INR 566) [March 31, 2022: INR 3,057 (Net of capital advances of INR 763)].

c. Contingent liabilities

i)	March 31, 2023	March 31, 2022
Claims against the Company not acknowledged as debts	476	494
Income tax related matters	88	19
Custom duty related matter	36	-
Total	600	513

ii) The Company will continue to assess the impact of further developments relating to retrospective application of Supreme Court judgement dated February 28, 2019 clarifying the definition of ''basic wages'' under Employees'' Provident Fund and Miscellaneous Provisions Act 1952 and deal with it accordingly. In the assessment of the management, the aforesaid matter is not likely to have a significant impact and accordingly, no provision has been made in these Standalone Financial Statements.

iii) The Company has been made aware of certain matters/claims relating to infringement of trademarks and patents in relation to the business activities carried on by it. The Company actively monitors such matters/claims along with appropriate legal/technology experts to assess their veracity and takes action as considered necessary. In the opinion of the management, no material liability is likely to arise on account of such matters/claims, based on assessments made to date.

Notes:

1) It is not practicable for the Company to estimate the timing of cash outflows, if any.

2) The Company does not expect any reimbursements in respect of the above contingent liabilities.

30. Fair value

Fair value hierarchy

The following table provides the fair value measurement hierarchy of the Company''s assets and liabilities:

Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3 - Inputs for the assets or liabilities that are not based on observable market data (unobservable inputs).

The management has assessed that fair value of all other financial assets and liabilities including cash and cash equivalents, bank balances other than cash and cash equivalents, trade receivables, loans, other financial assets, trade payables, lease liabilities and other financial liabilities, approximate their carrying amounts.

31. Financial risk management objectives and policies

The Company''s activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk. The Company continues to focus on a system-based approach to business risk management. The Company''s financial risk management process seeks to enable the early identification, evaluation and effective management of key risks facing the business. Backed by strong internal control systems, the current Risk Management Framework rests on policies and procedures issued by appropriate authorities; process of regular internal reviews/audits to set appropriate risk limits and controls; monitoring of such risks and compliance confirmation for the same.

a. 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 prices comprise three types of risk: interest rate risk, foreign currency risk and price risk. The Company has in place appropriate risk management policies to limit the impact of these risks on its financial performance. The Company ensures optimization of cash through fund planning and robust cash management practices.

(i) Interest Rate Risk

Interest rate risk refers to the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. There is no interest rate risk as the Company did not have borrowings at the end of the current and previous year.

(ii) Price risk

The Company invests its surplus funds in fixed deposits, Commercial papers, Treasury bills and Government Securities. There is no exposure of price risk on such instruments.

The Company is also exposed to equity/ preference shares price risk arising from investments held by the Company and classified in the balance sheet either as fair value through OCI or at fair value through profit or loss (refer note 7(a) and 7(b)). To manage its price risk arising from investments in equity/ preference shares, the company diversifies its portfolio. Diversification of the portfolio is done in accordance with the limits set by the company.

(iii) Foreign currency risk

The Indian Rupee is the Company''s most significant currency. As a consequence, the Company''s results are presented in Indian Rupee and exposures are managed against Indian Rupee accordingly. 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 and investing activities (when revenue, expense and Property, Plant and Equipment is denominated in a foreign currency).

b. Credit Risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) including deposits with banks. Management has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis. The Company applies expected credit loss (ECL) model on financial assets measured at amortised cost e.g., loans, debt securities, deposits, trade receivables and bank balance. Cash and cash equivalents are also subject to the impairment requirement of Ind AS 109, the identified impairment loss was immaterial.

All of the entity''s investments and loans at amortised cost are considered to have low credit risk, and the loss allowance recognised during the period was therefore limited to 12 months expected losses. Management considers instruments to be low credit risk when they have a low risk of default and the issuer has a strong capacity to meet its contractual cash flow obligations in the near term.

(i) Trade receivables

The Company is exposed to credit risk in the event of non-payment by customers. Customer credit risk is managed 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 by grouping the receivables in homogeneous group. The calculation is based on lifetime expected credit losses.

The maximum exposure to credit risk at the reporting date is the carrying value of trade receivables. The Company does not hold collateral as security.

(ii) Other investments (excluding loans to related parties)

All of the entity''s other investments (preference shares, government securities, commercial papers, treasury bills and security deposits) at amortised cost are considered to have low credit risk, and the loss allowance recognised during the period was therefore limited to 12 months'' expected losses. Management consider ''low credit risk'' for listed instruments to be an investment grade credit rating with at least one major rating agency. Other instruments are considered to have low credit risk when they have a low risk of default and the issuer has a strong capacity to meet its contractual cash flow obligations in the near term.

(iii) Loan to related parties

The Company considers the probability of default upon initial recognition of loan and whether there has been a significant increase in credit risk on an ongoing basis throughout each reporting period. To assess whether there is a significant increase in credit risk, the Company compares the risk of a default occurring on the loan as at the reporting date with the risk of default as at the date of initial recognition. It considers available reasonable and supportive forwarding-looking information.

(iv) Other financial assets

Credit risk from balances with banks and financial institutions is managed by the Company''s treasury department in accordance with the Company''s policy. Investment of surplus funds is made only with banks of high repute.

32. Capital Management

The Company''s objectives while managing capital is to safeguard its ability to continue as a going concern and to generate adequate returns for its shareholders and ensuring benefits for other stakeholders. The key objective of the Company''s capital management is to ensure that it maintains a stable capital structure with the focus on total equity, uphold investor, creditor and customer confidence, and ensure future development of its business activities. The Company manages its capital structure and makes adjustments to it, in light of changes in economic conditions or its business requirements.

Company''s capital management objective is to remain majorly a debt-free company till the time it achieves break-even. In order to meet this objective, Company meets anticipated funding requirements for developing new businesses, expanding its geographical base, entering in to strategic mergers and acquisitions and other strategic investments, by issuance of equity capital together with cash generated from Company''s operating and investing activities. The company utilizes certain working capital facilities in the form of short term bank overdraft to meet anticipated interim working capital requirements.

No changes were made in the objectives, policies or processes for managing capital during the year ended March 31, 2023 and March 31, 2022.

33. Segment Reporting

The Company is engaged in different business units, including payment and financial services, commerce and cloud services and the Board of Directors (Chief Operating Decision Maker "CODM”) reviews the information at the revenue level and does not allocate operating costs and expenses, assets and liabilities across business units, as the CODM does not use such information to allocate resources or evaluate the performance of the business units. The way the CODM reviews the performance, management of the Company has concluded that it constitutes a single segment as per Ind AS 108 ''Operating Segments''. Hence, no separate disclosure is required for segments.

The Company has revenues primarily from customers domiciled in India. Substantially all of the Company''s non-current operating assets are domiciled in India.

Information about major customers

Revenue of INR 7,089 are derived from one external customer (March 31, 2022: INR 6,379 from one external customer).

35. Overdue outstanding foreign currency receivables

As of March 31, 2023, the Company has certain foreign currency receivable balances aggregating to INR 374 outstanding beyond the stipulated time period permitted under the RBI Master Direction on Export of Goods and Services vide FED Master Direction No. 16/2015-16 dated January 1, 2016 (as amended), issued by the Reserve Bank of India (RBI). The Company had applied to the Authorised Dealer Bank for extension of time for realisation of the amount and the approval has been received.

36. Transfer pricing

The Company has established a comprehensive system of maintenance of information and documents as required by the transfer pricing legislation under sections 92-92F of the Income Tax Act, 1961. For this purpose, the Company has appointed independent consultants for conducting Transfer Pricing Study. Management is of the opinion that its international transactions with associated enterprises have been undertaken at arms'' length basis at duly negotiated prices on usual commercial terms. The transfer pricing study for the year ended March 31, 2022 has been completed which did not result in any material adjustment.

37. Corporate Social Responsibilities (CSR) expenditure

The Company has not earned net profit in three immediately preceding financial years, therefore, there was no amount as per section 135 of the Act which was required to be spent on CSR activities in the current financial year by the Company. However, the Company has spent an amount of INR 26 (March 31, 2022: INR 14) as CSR expenditure.

38. During the previous year ended March 31, 2022, the Company had transferred online Payment Aggregator business to Paytm Payments Services Limited, a wholly owned subsidiary of the Company, to comply with Guidelines on Regulation of Payment Aggregators And Payment Gateways issued by RBI via circular dated March 17, 2020. This business transfer agreement has been approved by Board and Shareholders on August 30, 2021 and September 23, 2021 respectively. The consideration of INR 2,838 for transfer of business would be settled in cash based on the carrying value of the net assets of the business as on September 1, 2021, being the date of transfer of operations. For accounting purposes date of effective loss of control over the above business has been taken as September 30, 2021 considering that the transaction was approved by the shareholders on September 23, 2021 and final submission was made to RBI on September 30, 2021. The consideration is to be paid in 5 equal annual installments payable at the end of each year without any interest. The difference between present value of consideration and net assets amounting to INR 601 has been accounted as ''Deemed Investment'' in Standalone Financial Statements. The transferred operations are not considered as discontinued operations in the Standalone Financial Statements of the Company in accordance with Ind AS. Consequent to the aforesaid transfer, figures for the previous year ended March 31, 2022 are not comparable with the figures of current year ended March 31, 2023.

39. Utilisation of IPO proceeds

During the year ended March 31, 2022, the Company had completed its initial public offer (IPO) of 85,116,278 equity shares of face value of INR 1 each at an issue price of INR 2,150 per share, comprising fresh issue of 38,604,651 shares and offer for sale of 46,511,627 shares by selling shareholders. The equity shares of the Company were listed on National Stock Exchange of India Limited (NSE) and BSE Limited (BSE) on November 18, 2021.

The Company had incurred INR 4,115 as IPO related expenses and allocated such expenses between the Company INR 1,866 and selling shareholders INR 2,249. Such amounts were allocated based on agreement between the Company and selling shareholders and in proportion to the total proceeds of the IPO. Out of Company''s share of expenses of INR 1,866, INR 1,401 had been adjusted to securities premium.

40. Buyback of shares

The Board of Directors at its meeting held on December 13, 2022 had approved buy-back of equity shares amounting to INR 8,500 (Maximum buy-back size, excluding transaction costs and tax on buy-back) at a price not exceeding INR 810 per equity share (Maximum buy-back price). The buyback was offered to the equity shareholders of the Company under the open market route through the stock exchanges.

The buyback of equity shares commenced on December 21, 2022 and was completed on February 13, 2023. During this period, the Company had bought back 15,566,746 Equity Shares at an average price of INR 545.93 per Equity Share aggregating to INR 8,498 (99.98% of the Maximum Buyback Size) and subsequently these shares have been extinguished.

Consequent to the said buy-back, the equity share capital has been reduced by INR 16 and an equivalent amount has been transferred from securities premium account to capital redemption reserve. Further INR 10,545 has been debited to the securities premium account on account of premium on shares bought back, related transaction costs and related taxes.

41. Additional disclosures required by Schedule III

(i) (a) The Company has granted loans and made investment in some of its subsidiary companies, associate companies, joint ventures and other parties. Loans has been given for general corporate purpose. In some of the cases, the susbidiaries, associates and joint ventures have utilised equity and borrowings for further investment as per their business requirement. Details of these Loans and investments for the year ended March 31, 2023 and March 31, 2022 are as follows:

The above transactions are in compliance with the relevant provisions of the Foreign Exchange Management Act, 1999 (42 of 1999) and the Companies Act, 2013 and the transactions are not violative of the Prevention of Money-Laundering act, 2002 (15 of 2003).

(i) (b) 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.

(ii) During the current year, the Company has not availed borrowings from banks and financial institutions. During the previous year, the Company had availed loan from a bank on the basis of security of current assets. The Company filed statement of current assets with the bank on quarterly basis. There were no material discrepancies between the statement filed and the books of accounts. There were no borrowing outstanding as on March 31, 2022.

(iii) There are no Balances reported with the companies identified as struck off under section 248 of Companies Act, 2013 or section 560 of Companies Act, 1956 as at March 31, 2023. During the year, the Company has written off and written back the balances with struck off companies amounting to * and 1 respectively.

(i) Debt Service Coverage Ratio has not been computed as Earnings available for debt service are negative for current year and previous year.

Total Debt = Borrowings Lease liabilities

Shareholder''s Equity = Total Equity

Earning available for Debt Service = Loss for the year Depreciation and amortization expense Finance costs Property, plant and equipment and intangible assets written off Loss/(profit) on sale of property, plant and equipment (net) Debt Service = Interest paid Repayment of term loan Principal elements of lease payments

Total Sales = Revenue from operations

Total Purchase = Payment processing charges Marketing and promotional expenses Software, cloud and data centre expenses (Other expenses - Provision for advances - Loss allowance for financial assets - Trade receivables / advance written off - Goods and services tax expense off - Property, plant and equipment and intangible assets written off - Exchange differences (net))

Net Profit = Loss for the year

Working Capital = Current Assets - Current Liabilities

EBIT = Loss before exceptional items and tax Finance costs - Other income

Capital employed = Total Equity - Other intangible assets - Intangible assets under development Borrowings Lease liabilities

(v) Details of benami property held

The Company does not hold any benami property and no proceedings have been initiated on or are pending against the Company under the Prohibition of Benami Property Transactions Act, 1988 (as amended in 2016) (formerly the Benami Transactions (Prohibition) Act, 1988 (45 of 1988)) and Rules made thereunder.

(vi) Wilful defaulter

The Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority.

(vii) Compliance with number of layers of companies

The Company has complied with the number of layers prescribed under the Companies Act, 2013.

(viii) Compliance with approved scheme(s) of arrangements

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

(ix) Undisclosed income

There is no income surrendered or disclosed as income during the current or previous year in the tax assessments under the Income Tax Act, 1961, that has not been recorded in the books of account.

(x) Details of crypto currency or virtual currency

The Company has not traded or invested in crypto currency or virtual currency during the current or previous year.

(xi) Valuation of PP&E, intangible asset and investment property

The Company does not have any investment property during the current or previous year. The Company has chosen cost model for its Property, Plant and Equipment and intangible assets and hence no revaluation was carried out for these assets.

(xii) Title deeds of immovable properties not held in name of the company

The title deeds of all the immovable properties are held in the name of the Company during the current and previous year.

(xiii) Registration of charges or satisfaction with Registrar of Companies

There are no charges or satisfaction which are yet to be registered with the Registrar of Companies beyond the statutory period.

(xiv) Utilisation of borrowings availed from banks and financial institutions.

The Company has not availed any borrowings from banks and financial institutions during the current year. During the previous year the Company had utilised the borrowing for the purpose it was obtained.

42. Company Secretary

Mr. Amit Khera, Company Secretary of the Company has resigned from the Company with effect from March 14, 2023. The Company is in the process of identifying the replacement and shall make the appointment at the earliest and in any event within the applicable statutory time limit.

1

After considering impact of share sub division

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Mar 31, 2022

The lease term is reassessed if an option is actually exercised (or not exercised) or the Company becomes obliged to exercise (or not exercise) it. The assessment of reasonable certainty is only revised if a significant event or a significant change in circumstances occurs, which affects this assessment, and that is within the control of the lessee. During the year ended March 31, 2022, the Company has given notice to vacate certain office premises. This has been accounted as lease termination. Hence, in accordance with Ind AS 116, Lease Liability has been re-measured by H 9

( March 31, 2021: 1,360) with corresponding adjustment to Right of Use assets amounting to H 6 (March 31, 2021: 1,321) and the remaining balance has been included in Miscellaneous Income disclosed under Other Income in the Statement of Profit and Loss.

The total cash outflow for leases for the year ended is H 314 (March 31, 2021: 383)

Extension and termination options:

Extension and termination options are included in ceratin leases. These are used to maximise operational flexibility in terms of managing the assets used in the Company''s operations. In certain cases, the extension and termination options held are exercisable only by the Company and not by the respective lessor.

#Inter corporate loans are given after complying with the provisions of section 186 of the Companies Act, 2013. The loans have been given in accordance with terms and conditions of the underlying agreements. Outstanding loans carry interest rate in the range of 5.10% to 12% (March 31, 2021 : 5.10% to 12%).

## Loan of H 803, H 402 and H 408 has been given to Paytm First Games Private Limited on June 7, 2021, September 30, 2021 and January 27, 2022 respectively. The Company has the rights of conversion into a variable number of shares in Paytm First Games Private Limited (Joint venture of Paytm Entertainment Limited, wholly owned subsidiary) at fair market value and with mutual consent, during the tenure of loan. The interest is payable at the end of the repayment period. The loan has been fair valued through profit and loss (FVTPL) since it does not meet the SPPI test.

(a) There are no repatriation restrictions with regard to cash and cash equivalents as at the end of the reporting period and prior period.

(b) Fixed deposits amounting to H 32 (March 31, 2021: h 9,609) included in note 7(d) and 10(b) are marked under lien by banks for providing bank overdraft, working capital demand loan and issuing bank guarantees under various contracts.

(c) Balance with banks on current accounts includes balance of Initial Public Offer (IPO) proceeds of H 736 (March 31, 2021: Nil) which will be utilised as stated in the prospectus for IPO.

(d) Fixed deposits amounting to H 70,900 (March 31, 2021: Nil) included in note 7(d) and 10(b) will be utilised as stated in the prospectus for IPO.

c. Shares reserved for issue under options

For details of shares reserved for issue under the employee stock options plan (ESOP) of the Company (refer note 24).

d. Aggregate number of bonus shares issued, shares bought back and share issued for consideration other than cash during the period of five years immediately preceding the reporting date:

The Company has not issued any shares for consideration other than cash during the current year (March 31, 2021: Nil shares; March 31, 2020: Nil shares; March 31, 2019: 333,035 shares; March 31, 2018: Nil shares; March 31, 2017: Nil shares). The Company has not issued bonus shares and has not bought back shares during the period of five years immediately preceding the reporting date.

Nature and purpose of reserves

(i) Securities premium

Securities premium is used to record the premium on issue of shares. The reserve is utilised in accordance with the provisions of the Act.

(ii) Employee stock options outstanding account (ESOP Reserve)

Employee stock options outstanding account is used to recognise the grant date fair value of options issued to employees under the One 97 Employee Stock Option Plan.

(iii) FVTOCI Reserve

The Company has elected to recognise changes in the fair values of the certain investments in equity instruments in other comprehensive income. These changes are accumulated within the FVTOCI reserve within equity. The Company transfers amounts from this reserve to retained earning when relevant equity securities are derecognised.

(i) As on March 31, 2021, Fixed Deposits backed Overdraft working capital limits (borrowing in INR) carry interest in the range of 4.2% p.a. to 6.3% p.a.. The security for the same is in the form of lien on fixed deposits amounting to H 5,170.

(ii) Working capital demand loan (borrowing in INR) carry interest at I-MCLR and "spread" per annum. As on March 31, 2021 MCLR is 7.25% p.a. and spread is 1% p.a. As on March 31, 2021, this was secured by way of hypothecation on the entire current assets (excluding Mutual Funds, FD & Bonds), lien on Fixed Deposits amounting to H 1,400 and backed by irrevocable and personal guarantee of Mr. Vijay Shekhar Sharma, Chairman, Managing Director and CEO.

(ii) Legal and professional fees includes

a) an amount of H 59 (March 31, 2021 : H Nil) as remuneration to non-executive and independent directors.

b) an amount of H 49 (March 31, 2021 : H 68) as payment to a Law firm in which one of the non-executive and independent director is interested. Further, payment of H 1 (March 31, 2021: h Nil) to the said firm which is in the nature of share issue expenses has been adjusted with securities premium account.

a) The Company basis its assessment of future business projections of its subsidiaries i.e. Orbgen Technologies Private Limited and Wasteland Entertainment Private Limited has recognized provision for impairment in the carrying value of its investments of H 132 and H 200 (March 31, 2021 : H 350 and H Nil), respectively, which has been shown as exceptional item in the Standalone Statement of Profit and Loss for the year ended March 31, 2022. During current and previous year, the impairment loss for Orbgen Technologies Private Limited and Wasteland Entertainment Private Limited was based on the equity value calculated based on cash flow projections with the business plan used for impairment testing using discounted cash flow method. The management has computed equity value of Orbgen Technologies Private Limited and Wasteland Entertainment Private Limited based on discount rate of 22.5% and terminal growth rate used in extrapolating cash flows beyond the planning period of 2.45 times of revenue of the terminal year.

b) The Company basis its assessment of future business projections of its associate, Eatgood Technologies Private Limited, has recognized provision of H 30 (March 31, 2021: 300) for impairment in the carrying value of its investment. During current and previous year, the management has computed equity value of Eatgood Technologies Private Limited based on discount rate of 17.24% and terminal growth rate used in extrapolating cash flows is 3.8%.

c) The Company has subscribed to optionally convertible debentures of Nearbuy India Private Limited (subsidiary of Little Internet Private Limited). The Company has the rights of conversion into a fixed number of equity shares. The investment has been fair valued through profit and loss (FVTPL) since it does not meet the SPPI test. The difference in fair value of H 79 has been taken as deemed investment in Little Internet Private Limited. The Company basis its assessment of future business projections has recognized an impairment of H 79 (March 31, 2021: Nil) during the year.

22. Earnings per shares (EPS)

Basic EPS amounts are calculated by dividing the profit/ (loss) for the year attributable to equity holders of the Company by the weighted average number of equity shares outstanding during the year.

Diluted EPS amounts are calculated by dividing the profit/ (loss) attributable to equity holders of the Company 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.

* In view of losses during the current year and previous year, the options which are anti-dilutive have been ignored in the calculation of diluted earnings per share. Accordingly, there is no variation between basic and diluted earnings per share.

# Pursuant to the approval of the shareholders at the Annual General Meeting of the Company held on June 30, 2021, each equity share of face value of H 10 per share was sub-divided into ten equity shares of face value of H 1 per share, with effect from record date, i.e., June 30, 2021. Consequently, the basic and diluted earnings per share have been computed for current year and previous year on the basis of the new number of equity shares in accordance with Ind AS 33, Earning per share.

23. Significant accounting judgements, estimates and assumptions

The preparation of the Company''s Standalone 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.

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 12 months, are described below.

Deferred taxes

Deferred tax assets can be recognised for deductible temporary differences (including unused tax losses) only to the extent that it is probable that taxable profit will be available against which the deductible temporary difference can be utilised. As the Company is yet to generate operating profits, Management has assessed that as at March 31, 2022 it is not probable that such deferred tax assets can be realised in excess of available taxable temporary differences. Management re-assesses unrecognised deferred tax assets at each reporting date and recognises to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered. For details about deferred tax assets, refer note 27.

During FY 2019-20 (AY 2020-21) a shareholder of the Company holding 30.33% of shares of the Company has transferred its shareholding to its group company (both entities being 100% subsidiaries of the same ultimate parent entity). Based on advice from the Company''s tax experts, Management has assessed that a mere change in shareholding within the same group will not be an affirmative position to say that the shareholding has been changed. Further, since the shares of the Company carrying not less than fifty-one percent of the voting power were beneficially held by persons, i.e. ultimate holding company of the aforesaid entities, who beneficially held shares of the company carrying not less than fifty-one percent of the voting power on the last day of the year or years in which the loss was incurred, the Company shall be entitled to carry forward and set off these losses against the taxable income of future years in accordance with the provisions of Section 79 of the Income Tax Act, 1961. (refer note 27)

Defined benefit plans (gratuity benefits)

The cost of the defined benefit gratuity plan and the present value of the gratuity 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.

In determining the appropriate discount rate for plans operated in India, the management considers the interest rates of government bonds in India. The mortality rate is based on publicly available mortality tables for India. The mortality tables tend to change only at interval in response to demographic changes. Future salary increases and gratuity increases are based on expected future inflation rates. For further details about gratuity obligations, refer note 26.

Fair value measurement of financial instruments

When the fair values of financial assets and financial liabilities recorded in the standalone balance sheet cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques including the DCF model, Price of Recent Investment (PORI) method and Comparable Company Multiples (CCM) method. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair values. For further details about Fair value measurement, refer note 30.

Impairment of financial assets

The Company assesses on a forward looking basis the expected credit risk associated with its assets carried at amortised cost. The impairment methodology applied depends on whether there has been a significant increase in credit risk. Note 31 details how the Company determines whether there has been a significant increase in credit risk.

Impairment reviews

Investments in subsidiaries and associates are tested for impairment at-least on an annual basis or when events that occur / changes in circumstances indicate that the recoverable amount is less than its carrying value. In calculating the value in

23. Significant accounting judgements, estimates and assumptions (Contd..)

use, the Company is required to make judgements, estimates and assumptions inter-alia concerning the growth in EBITDA, long-term growth rates; discount rates to reflect the risks involved. For details about impairment reviews, refer note 21.

Incentives

The Company provides incentives to users in various forms including cash backs to promote our platform. Incentives to users to whom the Company has a performance obligation is recorded as a reduction of revenue to the extent of the revenue earned. For the incentives to other transacting users to whom the Company has no performance obligation, management is required to determine whether the incentives are in substance a payment on behalf of the merchants and should therefore be recorded as a reduction of revenue or as marketing and promotional expenses. Some of the factors considered in management''s evaluation of such incentives being payments on behalf of merchants include whether the incentives are given at the Company''s discretion, contractual agreements with the merchants, business strategy and objectives and design of the incentive program(s), etc

24. Employee Stock Option Schemes (ESOP)(A) One97 Employees Stock Option Scheme 2019 (ESOP 2019 Scheme)

The Company introduced One97 Employee Stock Option Scheme 2019 for the benefit of employees as approved by the Board of Directors in the meeting held on 04th September 2019 and by shareholders in the Annual General Meeting held on 30th September 2019 wherein the Nomination and Remuneration Committee has been authorized to grant share-based stock options to eligible employees of the Company, its subsidiaries and associates under the ESOP 2019 Scheme. The maximum number of Employee Stock Options under ESOP 2019 Scheme shall not exceed 46,455,832* (Refer Note 1 & 2 below) equity shares. These Stock Options will generally vest between a minimum of one to a maximum of five years from the grant date subject to achievement of certain performance criteria.

Significant changes/modifications in the ESOP 2019 Scheme during FY 2020-21 & FY 2021-22

1) Pursuant to the approval of Shareholders of the Company at the Annual General Meeting held on June 30, 2021, each equity share of the Company having face value of H 10 each was sub divided into ten equity shares of face value of H 1 per share with effect from June 30, 2021. Accordingly, all outstanding Employee Stock Options and remaining Employee Stock Option Pool have also been sub divided in the similar proportion.

2) Shareholders of the Company in the Extra Ordinary General Meeting held on September 2, 2021 has approved increase in ESOP Pool by adding 37,000,000 options. Accordingly, total ESOP Pool for ESOP 2019 Scheme stands at 46,455,832.

3) During the year ended March 31, 2021, the Company had amended vesting percentage of ESOPs over 5 years of vesting schedule vide a resolution passed by the members of the Company in an Extra-Ordinary General Meeting dated March 26, 2021. All other terms and conditions remains the same as the original ESOP 2019 Scheme.

(B) One97 Employees Stock Option Scheme 2008 (ESOP 2008 Scheme)

The Company introduced One 97 Employee Stock Option 2008 Scheme for the benefit of employees as approved by the Board of Directors in the meeting held on September 8, 2008 and by the members in the Extra Ordinary General Meeting held on October 22, 2008 wherein Nomination and Remuneration Committee has authorized to grant share-based stock options to eligible employees of the Company and its subsidiaries under the ESOP 2008 Scheme. The maximum number of Employee Stock Options under ESOP 2008 Scheme shall not exceed 14,638,448* equity shares. These instruments will generally vest between a minimum of one to a maximum of four years from the grant date.

24. Employee Stock Option Schemes (ESOP) (Contd..)(C) Details about employee stock options granted, outstanding and other information:

1) During the year ended March 31, 2022, the Company has granted 27,428,285 (March 31, 2021- 3,868,310) Employee Stock Options under ESOP 2019 Scheme to Eligible Employees.

The above grant includes grant of 21,000,000 Employee Stock Options to Managing Director and CEO of the Company which is subject to achievement of certain milestones and will vest equally in 4 tranches, having minimum vesting period of 24 months, 36 months, 48 months and 60 months for each tranche respectively.

2) The total options outstanding as at March 31, 2022 under ESOP 2008 Scheme are 585,450 and ESOP 2019 Scheme are 29,317,167 (March 31, 2021 under ESOP 2008 Scheme - 5,362,100 and ESOP 2019 Scheme - 4,669,180). Scheme-wise options outstanding are as under:

During the year ended March 31, 2022, the Company has cancelled 67,550* outstanding unvested employee stock options and 68,830* outstanding vested Employee Stock options. This cancellation of unvested employee stock options resulted into an accelerated share based payment expense of H 39 (included in above charge) in the Standalone Statement of Profit and Loss for the year ended March 31, 2022.

1. Weighted average share price is based on the value of Equity Shares arrived at by using Discounted Cash Flow Method, OPM Method or Backsolve method and share prices based on secondary transactions, where available.

2. Dividend yield is considered zero, as no dividend payout is expected in the foreseeable future.

3. Risk free return is based on the yield to maturity of Indian treasury securities, with a maturity corresponding to the expected term of ESOP.

4. Annualized volatility is based on the median weekly volatility of selected comparable companies for a time period commensurate with the expected term.

Terms and conditions of transactions with related parties

(i) The services provided and received 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 (except for inter corporate loan receivable and optionally convertible debentures) and settlement generally occurs in cash. There have been no guarantees provided or received for any related party receivables or payables.

(ii) The remuneration to the key managerial personnel (''KMP'') does not include the provisions made for gratuity and leave benefits as they are determined on an actuarial basis for the Company as a whole.

(iii) The Company has agreed to provide appropriate financial support only if and to the extent required by certain of its subsidiaries and joint venture.

(iv) Refer note 20 for details of remuneration to non-excecutive and independent directors and payment to a law firm in which one of the non-executive and independent director is interested.

26. Gratuity

The Company provides for gratuity for employees in India as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service. The gratuity plan is a funded plan and the Company makes contributions to recognised fund/insurer in India. The Company does not fully fund the liability and maintains a target level of funding to be maintained over a period of time based on estimations of expected gratuity payments. Disclosures given below are as per actuarial valuation report of independent Actuary.

The following tables summarize the components of net benefit expenses recognized in the Standalone Statement of Profit and Loss and the funded status and amount recognized in the Standalone Balance Sheet.

The sensitivity analysis above have been determined based on a method that extrapolates the impact on defined benefit obligation as a result of reasonable changes in key assumptions occurring at the end of the reporting period. The methods and types of assumptions used in preparing the sensivity analysis did not change compared to the prior year.

Expected contributions to post-employment benefit plans for the period ending March 31, 2023 are H 162 (March 31, 2022 - H 113).

The weighted average duration of the defined benefit obligation is 2.78 years (March 31, 2021- 2.76 years).

The average remaining working life of members of the defined benefit obligation as at March 31, 2022 is 29.91 years (as at March 31, 2021- 29.06 years)

Asset volatility: The plan assets are calculated using a discount rate set with reference to bond yields. If plan assets underperform this yield, there will be a deficit of the plan asset investments in fixed income securities with high grades and in government securities. These are subject to interest rate risk and the fund manages interest rate risk to an acceptable level.

Changes in bond yields: The defined benefit obligation calculated uses a discount rate based on government bonds. If bond yields fall, the defined benefit obligation will tend to increase.

Inflation risks: The payments are not linked to inflation, so this is a less material risk.

Life expectancy: Obligations are to provide benefits for the life of the member, so increases in life expectancy and inflation will result in an increase in the plans'' liabilities. This is particularly significant where inflationary conditions result in higher sensitivity to changes in life expectancy.

a. Leases

Operating lease: Company as Lessee

The Company has taken certain office space on short term operating lease. The leases have varying terms, escalation clauses and renewal rights. On renewal, the terms of the leases are renegotiated. Rental expense towards leases charged to Standalone Statement of Profit and Loss for the year ended March 31, 2022 amount to H 42 (March 31, 2021: h 9).

b. Lease not yet commenced

During the previous year, the Company has entered into a lease agreement for 9 years having lock-in period of 5 years, for which lease is not yet commenced as on March 31, 2022. The Company is committed to pay lease rentals of H 293 over the period of 5 years.

c. Capital commitments

Estimated amount of contracts towards property, plant & equipment remaining to be executed on capital account and not provided for is H 3,057 (Net of capital advance of H 763) [March 31, 2021: h 3,719 (Net of capital advances of H 180)].

d. Contingent liabilities

i) Particulars	March 31, 2022	March 31, 2021
Claims against the Company not acknowledged as debts	494	460
Income tax related matters	19	16
Total	513	476

ii) The Company will continue to assess the impact of further developments relating to retrospective application of Supreme Court judgement dated February 28, 2019 clarifying the definition of ''basic wages'' under Employees'' Provident Fund and Miscellaneous Provisions Act 1952 and deal with it accordingly. In the assessment of the management, the aforesaid matter is not likely to have a significant impact and accordingly, no provision has been made in these Standalone Financial Statements.

iii) The Company has been made aware of certain matters/claims relating to infringement of trademarks and patents in relation to the business activities carried on by it. The Company actively monitors such matters/claims along with appropriate legal/technology experts to assess their veracity and takes action as considered necessary. In the opinion of the management, no material liability is likely to arise on account of such matters/claims, based on assessments made to date.

Notes:

1) It is not practicable for the Company to estimate the timing of cash outflows, if any.

2) The Company does not expect any reimbursements in respect of the above contingent liabilities.

30. Fair value Fair value hierarchy

The following table provides the fair value measurement hierarchy of the Company''s assets and liabilities:

Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3 - Inputs for the assets or liabilities that are not based on observable market data (unobservable inputs).

The management has assessed that fair value of all other financial assets and liabilities including cash and cash equivalents, bank balances other than cash and cash equivalents, trade receivables, loans, other financial assets, investments, trade payables, lease liabilities, borrowings and other financial liabilities, approximate their carrying amounts.

The Company''s activities expose it to a variety of financial risks, including market risk, credit risk and liquidity risk. The Company continues to focus on a system-based approach to business risk management. The Company''s financial risk management process seeks to enable the early identification, evaluation and effective management of key risks facing the business. Backed by strong internal control systems, the current Risk Management Framework rests on policies and procedures issued by appropriate authorities; process of regular internal reviews/audits to set appropriate risk limits and controls; monitoring of such risks and compliance confirmation for the same.

a. 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 prices comprise three types of risk: interest rate risk, foreign currency risk and price risk. The Company has in place appropriate risk management policies to limit the impact of these risks on its financial performance. The Company ensures optimization of cash through fund planning and robust cash management practices.

(i) Interest Rate Risk

Interest rate risk refers to the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates.

The Company''s exposure to the risk of changes in market interest rates relates primarily to the Company''s borrowings with floating interest rates.

The following table demonstrates the sensitivity to a reasonably possible change in interest rates, being a 0.5% increase or decrease in interest rate, with all other variables held constant, of the Company''s loss before tax due to the impact on floating rate borrowings.

As at	March 31, 2022	March 31, 2021
Effect on loss before tax: Decrease by 50 bps	Nil	(27)
Increase by 50 bps	Nil	27

Other financial assets and liabilities of the Company are either non-interest bearing or fixed interest bearing instruments, the Company''s net exposure to interest risk on such instruments is negligible.

The above sensitivity analysis is based on a reasonably possible change in the under-lying interest rate of the Company''s borrowings while assuming all other variables to be constant.

Based on the movements in the interest rates historically and the prevailing market conditions as at the reporting date, the Company''s management has concluded that the above mentioned rates used for sensitivity are reasonable benchmarks.

(ii) Price risk

The Company invests its surplus funds in various debt instruments, fixed deposits and debt mutual funds. These comprise of primarily debt based mutual funds (liquid investments), debentures and fixed deposits. As on March 31, 2021, all mutual fund investments were in liquid scheme only.

Mutual fund investments are susceptible to market price risk, mainly arising from changes in the interest rates or market yields which may impact the return and value of such investments.

Set out below is the impact of a 0.25% movement in the NAV of mutual funds and debt instruments on the Company''s loss before tax:

The Company is also exposed to equity/ preference shares price risk arising from investments held by the Company and classified in the balance sheet either as fair value through OCI or at fair value through profit or loss (refer note 7(a) and 7(b)). To manage its price risk arising from investments in equity/ preference shares, the company diversifies its portfolio. Diversification of the portfolio is done in accordance with the limits set by the company.

(iii) Foreign currency risk

The Indian Rupee is the Company''s most significant currency. As a consequence, the Company''s results are presented in Indian Rupee and exposures are managed against Indian Rupee accordingly. 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 and investing activities (when revenue, expense and Property, Plant and Equipment is denominated in a foreign currency).

The Company''s exposure to foreign currency changes for all other currencies is not material.

The above sensitivity analysis is based on a reasonably possible change in the under-lying foreign currency against the functional currency while assuming all other variables to be constant.

Based on the movements in the foreign exchange rates historically and the prevailing market conditions as at the reporting date, the Company''s management has concluded that the above mentioned rates used for sensitivity are reasonable benchmarks.

b. Credit Risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) including deposits with banks. Management has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis.

All of the entity''s investments and loans at amortised cost are considered to have low credit risk, and the loss allowance recognised during the period was therefore limited to 12 months expected losses. Management considers instruments to be low credit risk when they have a low risk of default and the issuer has a strong capacity to meet its contractual cash flow obligations in the near term.

(i) Trade receivables

The Company is exposed to credit risk in the event of non-payment by customers. Customer credit risk is managed 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 by grouping the receivables in homogeneous group. The calculation is based on lifetime expected credit losses.

32. Capital Management

The Company''s objectives while managing capital is to safeguard its ability to continue as a going concern and to generate adequate returns for its shareholders and ensuring benefits for other stakeholders. The key objective of the Company''s capital management is to ensure that it maintains a stable capital structure with the focus on total equity, uphold investor; creditor and customer confidence, and ensure future development of its business activities. The Company manages its capital structure and makes adjustments to it, in light of changes in economic conditions or its business requirements.

Company''s capital management objective is to remain majorly a debt-free company till the time it achieves break-even. In order to meet this objective, Company meets anticipated funding requirements for developing new businesses, expanding its geographical base, entering in to strategic mergers and acquisitions and other strategic investments, by issuance of equity capital together with cash generated from Company''s operating and investing activities. The company utilizes certain working capital facilities in the form of short term bank overdraft to meet anticipated interim working capital requirements.

No changes were made in the objectives, policies or processes for managing capital during the year ended March 31, 2022 and March 31, 2021.

33. Segment Reporting

During the previous year ended March 31, 2021, the Company reassessed the basis of segment reporting. This reassessment was necessitated by the change in business strategy over the period, increased interdependency between various service lines, increased fungibility of resources/common cost, change in the way Board of Directors (Chief Operating Decision Maker "CODM") review Company performance etc. Earlier, the Company disclosed four reportable segments that were Payment, Commerce, Cloud and others.

In line with the above shift in business strategy and the consequent change in the way the CODM reviews the performance, management of the Company has aligned segment disclosure to the above change. Further, it has been concluded that though there are different business units of the Company, including Payment and Financial services, Commerce and cloud services, information reviewed by the CODM is at the revenue level and the Company does not allocate operating costs and expenses, assets and liabilities across business units, as the CODM does not use such information to allocate resources or evaluate the performance of the business units. Allocation of resources and assessment of financial performance is done at the consolidated level.

Accordingly, it has been assessed that Company operates in a single Operating as well as Reportable Segment.

The Company has revenues primarily from customers domiciled in India. Substantially all of the Company''s non-current operating assets are domiciled in India.

Information about major customers

Revenue of H 6,379 are derived from one external customer (March 31, 2021: h 8,628 from one external customers).

35. Overdue outstanding foreign currency receivable and payable

As of March 31, 2022, the Company has certain foreign currency receivable balances aggregating to H 24, H 64 and H 261 which are outstanding for more than nine months, fifteen months (extended from nine months via RBI circular- RBI/2019-20/206 A. P. (DIR Series) Circular No. 27 dated April 1, 2020, for the exports made up to or on July 31, 2020) and three years, respectively. The Company has applied to the AD Bank seeking permission for extension of time for realisation for receivables amounting to H 63 and write-off of receivables amounting to H 1. Further, an application has been made to the RBI vide the letter dated December 17, 2020 for seeking approval for extension of time-limit of outstanding receivable balances amounting to H 191 and write off of receivable balances amounting to H 94 and approval is currently awaited.

As of March 31, 2022, the Company also has certain foreign currency payable balances aggregating to H 1.33* which are outstanding for more than three years. The Company has also filed an application to Reserve Bank of India (RBI) vide letters dated July 29, 2021 and August 9, 2021 for H 1.33* for permission to write-back payable balances and approval is currently awaited.

Management does not expect any material financial implication on account of the delay under existing regulations.

* Amount disclosed up to two decimal places.

36. Transfer pricing

The Company has established a comprehensive system of maintenance of information and documents as required by the transfer pricing legislation under sections 92-92F of the Income Tax Act, 1961. For this purpose, the Company has appointed independent consultants for conducting Transfer Pricing Study. Management is of the opinion that its international transactions with associated enterprises have been undertaken at arms'' length basis at duly negotiated prices on usual commercial terms. The transfer pricing study for the year ended March 31, 2021 has been completed which did not result in any material adjustment.

37. Corporate Social Responsibilities (CSR) expenditure

The Company has not earned net profit in three immediately preceding financial years, therefore, there was no amount as per section 135 of the Act which was required to be spent on CSR activities in the current financial year by the Company. However, the Company has spent an amount of H 14 (March 31, 2021: h 4) as CSR expenditure.

38. The Company has transferred online Payment Aggregator business to Paytm Payments Services Limited, a wholly owned subsidiary of the Company, to comply with Guidelines on Regulation of Payment Aggregators And Payment Gateways'' issued by RBI via circular dated March 17, 2020. This business transfer agreement has been approved by Board and Shareholders on August 30, 2021 and September 23, 2021 respectively. The consideration of H 2,838 million for transfer of business would be settled in cash based on the carrying value of the net assets of the business as on September 1, 2021, being the date of transfer of operations. For accounting purposes date of effective loss of control over the above business has been taken as September 30, 2021 considering that the transaction was approved by the shareholders on September 23, 2021 and final

38. (Contd..)

submission was made to RBI on September 30, 2021. The consideration is to be paid in 5 equal annual installments payable at the end of each year without any interest. The difference between present value of consideration and net assets amounting to H 601 million has been accounted as ''Deemed Investment'' in Standalone Financial Statements. The transferred operations are not considered as discontinued operations in the Standalone Financial Statements of the Company in accordance with Ind AS. Consequent to the aforesaid transfer, figures for the previous year presented are not comparable with the figures for the year ended March 31, 2022.

39. During the year ended March 31, 2022, the Company has completed its initial public offer (IPO) of 85,116,278 equity shares of face value of H 1 each at an issue price of H 2,150 per share, comprising fresh issue of 38,604,651 shares and offer for sale of 46,511,627 shares by selling shareholders. Pursuant to the IPO, the equity shares of the Company were listed on National Stock Exchange of India Limited (NSE) and BSE Limited (BSE) on November 18, 2021.

The Company has incurred H 4,115 million as IPO related expenses and allocated such expenses between the Company H 1,866 million and selling shareholders H 2,249 million. Such amounts were allocated based on agreement between the Company and selling shareholders and in proportion to the total proceeds of the IPO. Out of Company''s share of expenses of H 1,866 million, H 1,401 million has been adjusted to securities premium.

40. During the period ended June 30, 2021, the Company had filed an adjudication application under Section 454 read with Section 62(1)(b) and Section 450 of the Companies Act, 2013 before the office of the Registrar of Companies, NCT of Delhi & Haryana (ROC) on June 26, 2021, to adjudicate on the non-compliance with the provisions of Section 62(1)(b) of the Companies Act, 2013 ("the Act") read with Rule 12(1) of the Companies (Share Capital and Debentures) Rules, 2014 ("the Rules") in relation to grants of Employee Stock Options (ESOPs) made in earlier years to an employee. Consequently, the Company had cancelled the said ESOP grants on July 5, 2021. Further, the shares issued to the concerned employee pursuant to exercise of certain vested ESOPs were also transferred by the employee to Paytm Associate Benefit Welfare Trust (Formerly known as One97 Employee Welfare Trust). The cumulative charge recognized till date in respect of the aforesaid ESOPs amounted to H 106.

During the quarter ended December 31, 2021, the ROC vide its order dated November 30, 2021, had directed the Company to move an appropriate application for composition of offence under the relevant provision of the Act. Consequently, the Company has filed a compounding application under section 441 read with section 62(1)(b) and Section 450 of the Act read with the Rules, before the Office of the Regional Director (Northern Region), Ministry of Corporate Affairs, New Delhi (''RD'') on December 25, 2021. On March 15, 2022 RD has issued an order whereby RD has compounded the offence and levied compounding fees which has been duly paid and aforesaid matter is closed.