Company: ZCARW
Filing Date: 2025-02-14
Form Type: 10-Q
Source: 0001213900-25-014437
Chunk: 114

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-02-14
Form: 10-Q
Item: Part I, Item 1
Chunk 114
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 related disclosures at the date of the financial statements,
as well as revenue and expense recorded during the reporting periods. The Company evaluates our estimates and judgments on an ongoing
basis.

The Company bases its estimates
on historical experience and/or other relevant assumptions that the Company believes to be reasonable under the circumstances. Actual
results may differ materially from management’s estimates.

See Note 2, Summary of Significant
Accounting Policies, to our unaudited condensed consolidated financial statements for further information related to our critical accounting
policies and estimates, which are as follows:

Debt

The debt instruments
of the Company consist of debentures and term loans from financial institutions. The Company based on available proceeds makes periodic
prepayments of scheduled instalments and the same has been accounted for under ASC 470-50.

Redeemable Promissory Notes

During the nine
months ended December 31, 2024, the Company has issued Redeemable Promissory Notes which are repayable at the principal value on maturity
date and has been accounted for under ASC 470-10. The Company issued these Redeemable Promissory notes on discount and incurred expenses
on issue of the Redeemable Promissory Notes. As per ASC 835, the discount and the expenses incurred on issue of the Redeemable Promissory
Notes have been amortized over the period of the Redeemable Promissory note on a straight-line basis. The Redeemable Promissory Notes
liabilities have been presented net off the discount and issue expenses.

Debt Issuance costs 

Debt issuance costs consist
primarily of arrangement fees paid to Placement agent, professional fees, and legal fees. These costs are netted off with the related
debt and are being amortized to interest expense over the term of the related.

The debt has been classified
into current or non-current based on the payment terms of the debt instruments. Non-current obligations are those scheduled to mature
beyond twelve months from the date of the Company’s Condensed Consolidated Balance Sheets.

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Warrants

When the Company issues warrants, it evaluates
the balance sheet classification of the warrant to determine whether the warrant should be classified as equity or as a derivative liability
on the Condensed Consolidated Balance Sheets. In accordance with ASC 815- 40, Derivatives and Hedging- Contracts in the Entity’s
Own Equity (ASC 815-40), the Company classifies a warrant as