Company: ZCARW
Filing Date: 2025-02-14
Form Type: 10-Q
Source: 0001213900-25-014437
Chunk: 243

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-02-14
Form: 10-Q
Item: Part I, Item 8
Chunk 243
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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Through the direct and indirect interest
that Zoomcar Holdings, Inc. holds in the subsidiaries, Zoomcar Holdings, Inc. has the power to direct the activities of a VIE that most
significantly impact the VIE’s economic performance and has the obligation to absorb losses of the VIE that could potentially be
significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. Accordingly, Zoomcar
Holdings, Inc. is the primary beneficiary to Zoomcar Egypt Car Rental LLC, Zoomcar Vietnam Mobility LLC and Fleet Mobility Philippines
Corporation under the VIE model. Zoomcar, Inc., Zoomcar India Private Limited, Zoomcar Netherlands Holding B.V, Fleet Holding Pte Ltd
and PT Zoomcar Indonesia Mobility Service are consolidated as per the voting interest model.

On August 14, 2023, Zoomcar Vietnam
Mobility LLC has voluntarily filed application for bankruptcy with the local authorities of Vietnam. In accordance with ASC 205-30, the
liquidation of the VIE is imminent and thus, the financial statements of VIE are prepared on a liquidation basis, which entails valuing
assets at their estimated net realizable values and recording liabilities at their expected settlement amounts. Further, in accordance
with ASC 810-10-15-10, the Company consolidate the VIE as the bankruptcy application is pending with the authorities in Vietnam and unless
the application is admitted, the Company holds a variable interest and still is the primary beneficiary.

On May 30, 2024, PT Zoomcar Indonesia
Mobility Services has closed down its operations due to decrease in bookings and increased difficulties in carrying out the day-to-day
operations. Furthermore, on June 3, 2024, Zoomcar Egypt Car Rental LLC has closed down its operations due to decrease in operations and
rising economic difficulties. Additionally, On December 15 , 2024, Zoomcar Egypt Car Rental LLC held an extraordinary general meeting
to initiate the liquidation process and appoint a liquidator.

The assets/liabilities consolidated
for the VIE are not material.

(c)Use of estimates and assumptions

The use of estimates and assumptions
as determined by management is required in the preparation of the Condensed Consolidated Financial Statements in conformity with US GAAP.
These estimates are based on management’s evaluation of historical trends and other information available when the Condensed Consolidated
Financial