Hemadri Cements Ltd.की ऑडीटर रिपोर्ट

Mar 31, 2025

We have audited the standalone financial statements of HEMADRI CEMENTS LIMITED (“the Company”),
which comprise the Balance Sheet as at March 31, 2025, the Statement of Profit and Loss (including the
statement of Other Comprehensive Income ), the Statement of Changes in Equity and Statement of Cash
Flows for the year then ended, and notes to the financial statements, including a summary of significant
accounting policies and other explanatory information (hereinafter referred to as the “financial statements”).

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid
standalone financial statements give the information required by the Companies Act, 2013 (“the Act”) in the
manner so required and give a true and fair view in conformity with the Indian Accounting Standards
prescribed under sec 133of the Act read with the Companies (Indian Accounting Standards)Rules,2015,as
amended,(“Ind AS”) and other accounting principles generally accepted in India, of the state of affairs of the
Company as at March 31,2025, its loss (financial performance including other comprehensive Income), its
cash flows and the changes in equity for the year ended on that date.

Basis for Opinion

We conducted our audit of the financial statements in accordance with the Standards on Auditing specified
under section 143(10) of the Companies Act 2013 (SAs). Our responsibilities under those Standards are
further described in the Auditor’s Responsibilities for the Audit of the Standalone Financial Statements
section of our report. We are independent of the Company in accordance with the Code of Ethics issued by
the Institute of Chartered Accountants of India (ICAI) together with the independence requirements that are
relevant to our audit of the financial statements under the provisions of the Companies Act 2013 and the
Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these
requirements and the ICAI’s Code of Ethics. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion on the standalone financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion on the financialstatements.

Emphasis of Matters

We draw attention to Note 35 of the financial statements, which states that the Company has incurred
continuous losses since the financial year 2022-23, and its net worth has been fully eroded as of 31st March
2025. The Company temporarily suspended operations in August 2024 due to adverse market conditions and
high production costs. Management considers the suspension is temporary and is taking steps to improve
operations. The Company has also received financial support from group companies and continues to
receive assurances of future funding. Accordingly, the financial statements have been prepared on a going
concern basis.

Our opinion is not modified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit
of title financial statements of the current period. These matters were addressed in the context of our audit of
the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters. In addition to the matter described in ‘Emphasis of Matter'' section, we have
determined that there were no key audit matters to be communicated in our audit report.

Information Other than the Financial Statements and Auditor’s Report Thereon

The Company''s Board of Directors and the Management are responsible for the other information. The other
information comprises the information included in the Management Discussion and Analysis, Board''s Report
including Annexures to Board''s Report, Business Responsibility Report, Corporate Governance and
Shareholder''s Information, but does not include the standalone financial statements and our auditor''s report
thereon.

Our opinion on the standalone financial statements does not cover the other information and we do not
express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
standalone financial statements or our knowledge obtained during the course of our audit or otherwise
appears to be materially misstated. If, based on the work we have performed, we conclude that there is a
material misstatement of this other information, we are required to report that fact. When we read these
reports if we conclude that there is material misstatement therein, we are required to communicate the
matter with those charged with governance.

Responsibilities of the Management and those Charged with Governance for the Financial Statements

The Company''s Board of Directors and the Management are responsible for the matters stated in Section
134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these standalone financial
statements that give a true and fair view of the financial position, financial performance including other
comprehensive income / loss, changes in equity and cash flows of the Company in accordance with
accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS)
specified under section 133 of the Act. This responsibility also includes maintenance of adequate accounting
records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for
preventing and detecting frauds and other irregularities; selection and application of appropriate accounting
policies; making judgments and estimates that are reasonable and prudent; and the design, implementation
and maintenance of adequate internal financial controls, that were operating effectively for ensuring the
accuracy and completeness of the accounting records, relevant to the preparation and presentation of the
standalone financial statements that give a true and fair view and are free from material misstatement,
whether due to fraud or error.

In preparing the financial statements, the Board of Directors and the Management are responsible for
assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to
going concern and using the going concern basis of accounting unless management either intends to
liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Board of Directors and the Management are responsible for overseeing the Company’s financial reporting
process.

Auditor’s Responsibilities for the Audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes
our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted
in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise
from fraud or error and are considered material if, individually or in aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of these standalone financial
statements.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional
skepticism throughoutthe audit. We also:

• Identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting
a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may
involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal
control.

• Obtain an understanding of internal financial controls relevant to the audit in order to design audit
procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Companies Act,
2013, we are also responsible for expressing our opinion on whether the Company has adequate
internal financial controls system in place and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.

• Conclude on the appropriateness of management’s use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to events
or conditions that may cast significant doubt on the Company’s ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required to draw attention in our
auditor’s report to the related disclosures in the standalone financial statements or, if such
disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence
obtained up to the date of our auditor’s report. However, future events or conditions may cause the
Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the standalone financial statements,
includingthe disclosures, and whetherthe standalonefinancialstatements represent the underlying
transactions and events in a manner that achieves fair presentation.

Materiality is the magnitude of misstatements in the financial statements that, individually or in aggregate,
makes it probable that the economic decisions of a reasonably knowledgeable user of the standalone
financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i)

V y

planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect
of any i dentified misstatements in the financial statements.

We communicate with those charged with governance regarding, among other matters, the planned scope
and timing of the audit a nd significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters
that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were
of most significance in the audit of the financial statements of the financial year ended March 31, 2025 and
are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation
precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a
matter should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s report) Order, 2020 (“the Order”) issued by the Central
Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure A, a
statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required by section 143 (3) of the Act, we report that:

(a) We have sought and obtained all the information and explanations which to the best of our knowledge
and belief were necessary for the purpose of our audit.

(b) In our opinion, proper books of accounts as required by law have been kept by the Company so far as it
appears from our examination of those books.

(c) The Balance Sheet, Statement of Profit and Loss, (including the statement of Other Comprehensive
Income), the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in
agreement with the books of account.

(d) In our opinion, the aforesaid standalone financial statements comply with the Indian Accounting
Standards specified under section 133 of the Act.

(e) On the basis of written representations received from the directors as on March 31,2025, and taken on
record by the Board of Directors, none of the directors is disqualified as on March 31,2025, from being
appointed as a director in terms of section 164 (2) of the Act.

(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company
and the operating effectiveness of such controls, refer to our separate Report in “Annexure B” to this
report.

(g) With respect to the other matters to be included in the Auditor’s Report in accordance with the
requirements of section 197(16) of the Act, as amended:.

In our opinion and to the best of our information and according to the explanations given to us, no
remuneration paid by the Company to its directors during the year and hence provisions of section 197
of the Act is not applicable.

(h) With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of
the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:

i. The Company does not have any pending litigations which would impact its financial position
to the financial statements.

ii. The Company did not have any long-term contracts including derivative contracts for which
there were any material foreseeable losses.

iii. There were no amounts which were required to be transferred to the Investor Education and
Protection Fund by the Company during the year ended March 31,2025.

iv. (a) The Management has represented that, to the best of its knowledge and belief, as

disclosed in the Note 56 to the financial statements no funds ( which are material
either individually or in aggregate) have been advanced or loaned or invested (either
from borrowed funds or share premium or any other sources or kind of funds) by the
Company to or in any other person or entity, including foreign entity
(“Intermediaries”), with the understanding, whether recorded in writing or
otherwise, that the Intermediary shall, whether directly or indirectly lend or invest in
other persons or entities identified in any manner whatsoever by or on behalf of the
Company (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on
behalf of the Ultimate Beneficiaries;

(b) The Management has represented that, to the best of its knowledge and belief, as
disclosed in the Note 56 to the financial statements no funds ( which are material
either individually or in aggregate) have been received by the Company from any
person or entity, includingforeign entity (“Funding Parties”), with the understanding,
whether recorded in writing or otherwise, that the Company shall, whether 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 provide
any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

(c) Based on the audit procedures that have been considered reasonable and
appropriate in the circumstances, nothing has come to our notice that has caused
us to believe that the representations under sub-clause (i) and (ii) of Rule 11(e), as
provided under (a) and (b) above, contain any material misstatement.

iv. The Company did not propose, declare or pay dividends during the year ended 31 March 2025.

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v. Based on our examination which included test checks, the company has used an accounting
software for maintaining its books of account which has a feature of recording audit trail (edit
log) facility and the same has operated throughout the year for all relevant transactions
recorded in the software. Further, during the course of our audit we did not come across any
instance of audit trail feature being tampered with. Additionally, the audit trail has been
preserved by the company as per the statutory requirements for record retention. Our
examination of the audit trail was in the context of an audit of financial statements carried out
in accordance with the Standard of Auditing and only to the extent required by Rule 11(g) of the
Companies (Audit and Auditors) Rules,2014. We have not carried out any audit or examination
of the audit trail beyond the matters required by the aforesaid Rule 11(g) nor have we carried out
any standalone audit or examination of the audit trail.

for S B S B AND ASSOCIATES
Chartered Accountants
(Firm Regn. No. 012192S)

D. Sharath Kumar
Partner
M.No:024568
UDIN: 25024568BMOSYL9928

Place: Chennai
Date: -03-05-2025

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Mar 31, 2024

We have audited the standalone financial statements of HEMADRI CEMENTS LIMITED(“the Company”), which comprise the Balance Sheet as at March 31, 2024, the Statement of Profit and Loss (including the statement of Other Comprehensive Income ), the Statement of Changes in Equity and Statement of Cash Flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information (hereinafter referred to as the “financial statements”).

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 (“the Act”) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under sec 133of the Act read with the Companies (Indian Accounting Standards)Rules,2015,as amended,(“Ind AS”) and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2024, its loss (financial performance including other comprehensive Income), its cash flows and the changes in equity for the year ended on that date.

Basis for Opinion

We conducted our audit of the financial statements in accordance with the Standards on Auditing specified under section 143(10) of the Companies Act 2013 (SAs). Our responsibilities under those Standards are further described in the Auditor’s Responsibilities for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the independence requirements that are relevant to our audit of the financial statements under the provisions of the Companies Act 2013 and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAI''s Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to the matter described in ''Emphasis of Matter'' section, we have determined that there were no key audit matters to be communicated in our audit report.

The Company''s Board of Directors and the Management are responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis, Board''s Report including Annexures to Board''s Report, Business Responsibility Report, Corporate Governance and Shareholder''s Information, but does not include the standalone financial statements and our auditor''s report thereon.

Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. When we read these reports if we conclude that there is material misstatement therein, we are required to communicate the matter with those charged with governance.

Responsibilities of the Management and those Charged with Governance for the Financial Statements

The Company''s Board of Directors and the Management are responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income / loss, changes in equity and cash flows of the Company in accordance with accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the Board of Directors and the Management are responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Board of Directors and the Management are responsible for overseeing the Company''s financial reporting process.

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. Wealso:

• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal financial controls relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Companies Act, 2013, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

Materiality is the magnitude of misstatements in the financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the standalone financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the financial statements.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit ofthe financial statements of the financial year ended March 31, 2024 and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s report) Order, 2020 (“the Order”) issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure A, a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required by section 143 (3) of the Act, we report that:

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit.

(b) In our opinion, proper books of accounts as required by law have been kept by the Company so far as it appears from our examination of those books.

(c) The Balance Sheet, Statement of Profit and Loss, (including the statement of Other Comprehensive Income), the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the aforesaid standalone financial statements comply with the Indian Accounting Standards specified under section 133 of the Act.

(e) On the basis of written representations received from the directors as on March 31, 2024, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31,2024, from being appointed as a director in terms of section 164 (2) of the Act.

(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure B” to this report.

(g) With respect to the other matters to be included in the Auditor''s Report in accordance with the requirements of section 197(16) of the Act, as amended:.

In our opinion and to the best of our information and according to the explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance with the provisions of section 197of the Act.

(h) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company does not have any pending litigations which would impact its financial position to the financial statements.

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company during the year ended March 31, 2024.

iv. (a) The management has represented, to the best of its knowledge and belief, that no funds (which are material either individually or in aggregate), other than those disclosed in note 7 to the financial statements, have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person or entity, including foreign entity (“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

(b) The management has represented, to the best of its knowledge and belief, that no funds (which are material either individually or in aggregate), other than those disclosed in note 22 to the financial statements, have been received by the Company from any person or entity, including foreign entity (“Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether 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 provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

(c) Based on the audit procedures that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (i) and (ii) of Rule 11(e), as provided under (a) and (b) above, contain any material misstatement.

iv. The Company did not propose, declare or pay dividends during the year ended 31 March 2024.

v. Based on our examination, the Company has used an accounting software “PACT” for maintaining its books of accounts which does not have a feature of recording audit trail (edit log) facility and consequently we are unable to comment on audit trail requirements of the said software as envisaged under Rule 11(g). As mentioned in note 44 to the financial statements, the Company is in the process of migrating to a new accounting software which will contain the necessary controls and documentation regarding the audit trail.

As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable from 01 April 2023, reporting under rule Rule 11(g) of the Companies (Audit and Auditors) Rules, 2014 on preservation of audit trail as per the statutory requirements for record retention is not applicable for the financial year ended March 31, 2024.

for S B S B AND ASSOCIATES

Chartered Accountants (Firm Regn. No. 012192S)

S/d

D. Sharath Kumar Partner M.No:024568 UDIN:24024568BKCZGS4425

Place: Chennai Date: 27-05-2024

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Mar 31, 2023

We have audited the standalone financial statements of HEMADRI CEMENTS LIMITED ("the Company"), which comprise the Balance Sheet as at March 31, 2023, the Statement of Profit and Loss (including the statement of Other Comprehensive Income ), the Statement of Changes in Equity and Statement of Cash Flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies and other explanatory information (hereinafter referred to as the "standalone financial statements").

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Companies Act, 2013 ("the Act") in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under sec 133of the Act read with the Companies (Indian Accounting Standards)Rules,2015,as amended,("Ind AS") and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2023, its loss (financial performance including other comprehensive Income), its cash flows and the changes in equity for the year ended on that date.

Basis for Opinion

We conducted our audit of the financial statements in accordance with the Standards on Auditing specified under section 143(10) of the Companies Act 2013 (SAs). Our responsibilities under those Standards are further described in the Auditor''s Responsibilities for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the independence requirements that are relevant to our audit of the financial statements under the provisions of the Companies Act 2013 and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAI''s Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements.

Emphasis of Matter

We draw attention to notes 5, 7 and 37 of the financial statements, wherein the Company''s had invested a sum of Rs. 60.00 lakhs in HCL Agro Power Limited (''HAPL'') and advanced an amount to Rs. 1,776.27 lakhs that is receivable. HAPL has ceased its operations, resulting in a significant doubt regarding the recovery of the advanced amount and in consequence, the management of the Company has made a total provision of Rs. 1,050.00 lakhs (which includes current year provision of 520.00 lakhs), considering the potential recovery from monetising the assets of HAPL. Our Opinion is not modified in respect of the above matter.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined that there were no key audit matters to be communicated in our audit report.

Information Other than the Financial Statements and Auditor''s Report Thereon

The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis, Board''s Report including Annexures to Board''s Report, Business Responsibility Report, Corporate Governance and Shareholder''s Information, but does not include the standalone financial statements and our auditor''s report thereon.

Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Management''s Responsibility for Standalone Financial Statements

The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these standalone financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income / loss, changes in equity and cash flows of the Company in accordance with accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the standalone financial statements, management is responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Board of Directors are responsible for overseeing the Company''s financial reporting process.

Auditor''s Responsibilities for the Audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor''s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal financial controls relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Companies Act, 2013, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company''s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor''s report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

Materiality is the magnitude of misstatements in the financial statements that, individually or in aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the standalone financial statements may be influenced. We consider quantitative materiality and qualitative factors in (i) planning the scope of our audit work and in evaluating the results of our work; and (ii) to evaluate the effect of any identified misstatements in the financial statements.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s report) Order, 2020 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure A, a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required by section 143 (3) of the Act, we report that:

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

(b) In our opinion, proper books of accounts as required by law have been kept by the Company so far as it appears from our examination of those books.

(c) The Balance Sheet, Statement of Profit and Loss, (including the statement of Other Comprehensive Income), the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the aforesaid standalone financial statements comply with the Indian Accounting Standards specified under section 133 of the Act.

(e) On the basis of written representations received from the directors as on March 31, 2023, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2023, from being appointed as a director in terms of section 164 (2) of the Act;

(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure B" to this report;

(g) With respect to the other matters to be included in the Auditor''s Report in accordance with the requirements of section 197(16) of the Act, as amended:

In our opinion and to the best of our information and according to the explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance with the provisions of section 197 of the Act.

(h) With respect to the other matters to be included in the Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company does not have any pending litigations which would impact its financial position to the financial statements.

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company during the year 31^st march 2023.

iv.

a. The Management has represented that, to the best of its knowledge and belief that no funds ( which are material either individually or in aggregate) have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person or entity, including foreign entity ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

b. The Management has represented that, to the best of its knowledge and belief that no funds ( which are material either individually or in aggregate) have been received by the Company from any person or entity, including foreign entity ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether 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 provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

c. Based on the audit procedures that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (i) and (ii) of Rule 11(e), as provided under (a) and (b) above, contain any material misstatement

v. The Company did not propose, declare or pay dividends during the year ended 31 March 2023

For S B S B AND ASSOCIATES

Chartered Accountants (Firm Regn. No. 012192S)

D. Sharath Kumar Partner

Place: Chennai M.No: 024568

Date: 29-05-2023 UDIN:23024568BGULDH5939

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Mar 31, 2015

We have audited the accompanying Standalone financial statements of HEMADRI CEMENTS LIMITED ("the Company"), which comprises the Balance Sheet as at 31st March,2015, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended and a summary of the significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these Standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these Standalone financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Standalone financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2015, and its profit and its cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2015 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure, a statement on the matters specified in Para 3 and 4 of the said Order.

2. As required by Section143 (3) of the Act, we report that:

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books.

(c) The Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement dealt with by this Report are in agreement with the books of account.

(d) In our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule7 of the Companies (Accounts) Rules, 2014.

(e) On the basis of the written representations received from the directors as on 31st March, 2015 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2015 from being appointed as a director in terms of Section 164(2) of the Act.

(f) With respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in ours opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer note 28 to the financial statements.

ii. The Company did not have any long-term contracts including derivative contracts for which there is no provision required for material foreseeable losses.

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

ANNEXURE TO THE INDEPENDENT AUDITOR'S REPORT

With reference to the Annexure referred to in paragraph 1 under the heading "Report on Other Legal and Regulatory Requirements" of the Independent Auditor's report to the members of HEMADRI CEMENTS LIMITED on the standalone financial statements for the year ended 31st March 2015, we report that:

(i) (a) The Company is maintaining proper records showing full particulars, including quantitative details and situation of all fixed assets.

(b) All the assets have not been physically verified by the Management during the year but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the company and the nature of its assets. Material discrepancy noticed between book balance and physical assets of fixed assets have been properly dealt with in the books of accounts.

(ii) (a) The Management has conducted physical verification of Inventory at reasonable intervals during the year. In our opinion, the frequency of such verification is reasonable.

(b) The procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) On the basis of our examination of the records of inventory, we are of the opinion that the Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

(iii) According to the information and explanations given to us, the Company has not granted any loans, secured or unsecured, to companies, firms or other parties covered in the register maintained under Section 189 of the Companies Act, 2013. Accordingly, reporting under clauses (iii) (a) and (b) of the Order is not applicable.

(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with respect to purchase of inventory and fixed assets and for the sale of goods and services. Further, on the basis of our examination of the books and records of the Company and according to the information and explanations given to us, we have neither come across nor have we been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system.

(v) The Company has not accepted any deposits from the public within the meaning of section 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules framed there under and hence the clause (v) of paragraph 4 of the CARO 2015 is not applicable.

(vi) We have broadly reviewed the books of account and records maintained by the company pursuant to the Rules made by the Central Government for the maintenance of Cost Records under section 148(1) of the Companies Act, 2013 and we are of the opinion that prima facie,the prescribed accounts and records have been made and maintained.

(vii) (a) According to the information and explanations given to us and on the basis of our examination of the books and records of the Company, in respect of undisputed statutory dues including provident fund, income-tax, sales tax, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues have been regularly deposited during the year by the Company with appropriate authorities. As explained to us, the Company didn't have any dues on account of Employee's State Insurance.

According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, income-tax, sales tax, wealth tax, service tax, duty of customs, duty of excise, value added tax, cess and other material statutory dues were in arrears as at 31st March 2015 for a period of more than six months from the date they became payable.

(b)According to the information and explanations given to us and the records of the Company examined by us, there are no material dues of Income tax, sales tax, wealth tax, service tax, duty of customs, duty of excise, value added tax and cess which have not been deposited on account of any disputes except for:

S No Nature of the Dues Forum where Dispute is pending

1 Income Tax due Appeal before Commissioner of Income Tax Hyderabad

S No Nature of the Dues Amount (Rs.) Period to which amount relates

1 Income Tax due 330.88 Lakhs AY 2012-13

(c) There are no amounts which are required to be transferred to Investor Education and Protection Fund in accordance with the relevant provisions of the Companies Act, 1956 and rules made thereunder.

(viii) The Company doesn't have any accumulated losses at the end of the financial year and has not incurred cash losses in the current financial year and no such cash losses in the immediately preceding financial year.

(ix) According to the records of the Company examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

(x) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions.

(xi) Based on information and explanations given to us by the management,the company has not taken any term loans during the current period and hence the clause(xi) of para 4 of CARO ,2015 is not applicable.

(xii) During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instances of material fraud on the Company or any instances of fraud by the Company noticed or reported during the year, nor have we been informed of such cases by the management.

Place: Chennai For B.PURUSHOTTAM & CO Chartered Accountants Date : 12.08.2015 (Firm Regn No.002808S) B.S. PURSHOTHAM PARTNER M No : 026785

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Mar 31, 2014

We have audited the accompanying financial statements of HEMADRI CEMENTS LIMITED ("the Company"), which comprise the Balance Sheet as at 31st March 2014, and the Statement of Profit and Loss and Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance of the Company in accordance with the Accounting Standards notified under the Companies Act, 1956 ("the Act") read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March 2014;

b) in the case of the Statement of Profit and Loss, of the Profit for the year ended on that date;

c) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1) As required by the Companies (Auditor''s Report) Order, 2003 ("the Order"), as amended, issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in

the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

2) As required by section 227(3) of the Act, we report that:

a) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

b) in our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

c) the Balance Sheet, Statement of Profit and Loss dealt with by this Report are in agreement with the books of account;

d) in our opinion, the Balance Sheet, Statement of Profit and Loss dealt with by this report comply with the Accounting Standards notified under the Act read with the General Circular 15/2013 dated 13th September 2013, of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013; and

e) on the basis of written representations received from the directors, as on 31st March 2014 and taken on record by board of directors, none of the directors is disqualified as on 31st March 2014 from being appointed as director in terms of clause (g) of subsection (1) of section 274 of the companies act,1956;

f) Since the Central Government has not issued any notification as to the rate at which the cess is to be paid under section 441A of the Companies Act, 1956 nor has it issued any Rules under the said section, prescribing the manner in which such cess is to be paid, no cess is due and payable by the Company.

The Annexure referred to in paragraph 1 of the Our Report of even date to the members of HEMADRI CEMENTS LIMITED, on the accounts of the company for the year ended 31st March, 2014.

On the basis of such checks as we considered appropriate and in terms of information and explanations given to us, we state that:

I In respect of fixed assets:

a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

b) All the assets have not been physically verified by the Management during the year but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the company and the nature of its assets. Material discrepancy noticed between book balance and physical assets of fixed assets have been properly dealt with in the books of accounts.

c) During the year, the Company has not disposed off any substantial part of Fixed Assets.

II In respect of Inventories:

a) The inventory has been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

b) The procedures of physical verification of inventories followed by the Management are reasonable and adequate in relation to the size of the Company and the nature of its business.

c) On the basis of our examination of the records of inventory, we are of the opinion that the Company is maintaining proper records of inventory. The discrepancies noticed on verification between the physical stocks and the book records were not material.

III In respect of loans granted or taken to/from companies, firms or other parties in the register maintained under section 301 of the Companies act, 1956:

a) According to the information and explanations given to us, the Company has granted loan to one party covered in the register maintained under Section 301 of the Companies Act 1956.The maximum amount involved during the year including opening balance was Rs. 161.66 lakhs and the year- end balance of loans granted to such parties was Rs.161.66 lakhs.

b) In our opinion and according to the information and explanations given to us the rate of interest and other terms and conditions are not prejudicial to the interest of the Company.

c) In respect of the loans granted, repayment of the principal amount is as stipulated and payment of interest have been regular.

d) There is no overdue amount of loans granted to companies, firm or other parties listed in the register maintained under section 301 of the Companies Act, 1956.

e) The company has not borrowed any loan during the year. Hence the clause (iii)(e), (iii)(g) and (iii) (f) of paragraph 4 of the CARO 2003 is not applicable.

IV In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business. Further, on the basis of our examination of the books and records of the company and according to the information and explanation given to us, we have neither come across nor have we been informed of any instance of major weakness in the aforesaid internal control procedure.

V (a) In our opinion and according to the information and explanations given to us, the transactions that need to be entered into the register in pursuance of Section 301 of the Companies Act 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act 1956 and exceeding the value of rupees five lakhs in respect of any party during the year have been made at prices which are reasonable having regard to prevailing market prices at the relevant time.

VI The Company has not accepted any deposits from the public within the meaning of Section 58 A and 58 AA of the Act and the rules framed there under, and hence the clause (vi) of paragraph 4 of the CARO 2003 is not applicable.

VII In our opinion, the Company has an internal audit system commensurate with its size and nature of its business.

VIII We have broadly reviewed the books of account and records maintained by the company pursuant to the Rules made by the Central Government for the maintenance of Cost Records under section 209(1 )(d) of the Companies Act,1956 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

IX a) According to the information given to us, and the records of the Company examined by us, in our opinion, the Company is regular in depositing undisputed statutory dues including Providenr Find, Investor Education and Protection Fund, Employees State insurance, Income tax, Service tax, Excise Duty, Cess and other material statutory dues as applicable, with the appropriate authorities.

b) According to the information and explanations given to us, no undisputed amounts payable in respect of income tax, sales tax, wealth tax, service tax, customs duty and excise duty were in arrears as at 31st March 2014 for a period of more than six months from the date they become payable.

c) According to the information and explanations given to us, and the records of the Company examined by us, there are no dues of Sales tax, Income tax, Customs duty, Wealth tax, Service tax, Excise duty and Cess which have not been deposited on account of any disputes except for:

S. Nature of the Forum where Dispute is Amount Period to which No. Dues Pending (Rs.) amount relates

Sales Tax Appellate Tribunal, 20.26 1 APVAT Vizag Appeal No. VJA Lakhs F.Y. 2006-07 1/41/08-09

Appeal before Commissioner of 265.86 2 Income Tax due Income Tax Hyderabad Lakhs A.Y. 2008-09

Penalty for over 54.71 3 drawal of APERC Lakhs F.Y. 2011-12 Electricity

X The Company has no accumulated losses at the end of the financial year and it has not incurred any cash losses in the current and immediately preceding financial year.

XI Based on our audit procedures and on the basis of information and explanations given by the Management, the Company has not borrowed any loans from Financial Institutions, banks or debentures holders and hence we have no comments to offer under the clause (xi) of paragraph 4 of the CARO 2003

XII The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities and hence we have no comments to offer under the clause (xii) of paragraph 4 of the CARO 2003.

XIII In our opinion, the Company is not a chit fund or nidhi mutual benefit fund /society. Therefore, the provisions of clause (xiii) of paragraph 4 of the CARO 2003 are not applicable to the Company.

XIV In our opinion, the nature of Company''s business/activities during the year does not include dealing in shares, securities, debentures or other investments. Accordingly, the requirements of clause (xiv) of paragraph 4 of the CARO 2003 are not applicable to the Company.

XV In our opinion, and according to the information and explanations given to us, the Company has not given guarantee for loans taken by others from banks or financial institutions.

XVI Based on the information and explanations given to us by the Management, the Company has not taken any Term Loans and hence we have no comments to offer under the clause (xvi) of paragraph 4 of the CARO 2003.

XVII According to the information and explanations given to us, and an overall examination of Balance Sheet of the Company, we report that no funds raised on short-term basis have been used for long term investments

XVIIIAccording to the information and explanations given to us, the Company has not made preferential allotment of shares to a Company covered in the register maintained under section 301 of the Companies Act, 1956 during the year.

XIX According to the information and explanations given to us, during the period covered by our audit report, the Company has not issued any debentures.

XX The Company has not raised any money by way of public issue during the year and hence the question of disclosure and verification of end use of such money does not arise during the year.

XXI Based upon the audit procedures performed, information and explanation given by the Management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.

B. PURUSHOTTAM & CO. Chartered Accountants Firm Reg. No. 002808S

Place : CHENNAI. B.S. PURSHOTHAM Date : 18.07.2014 Partner M.No. 026785

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Mar 31, 2012

1) We have audited the attached Balance Sheet of HEMADRI CEMENTS LIMITED., as at 31st March 2012, Statements of Profit and Loss and Funds Flow for the year ended on that date annexed thereto. These financial Statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

2) We conducted our audit in accordance with the auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3) As required by the Companies (Auditor's Report) order, 2003 issued by the Central Government of India in terms of Sub-section (4A) of Section 227 of the companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.

4) Further to our comments in the Annexure referred to above, we report that:

i) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit;

ii) In our opinion, proper books of account as required by law have been kept by the company so far as appears from our examination of those books;

iii) The Balance Sheet, Statements of Profit and Loss account and Cash Flow dealt with by this report are in agreement with the books of account;

iv) In our opinion, the Balance Sheet, Statements of Profit and Loss account and Cash Flow dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies act, 1956;

v) On the basis of written representations received from the directors, of the company as at 31st March, 2012 and taken on record by the board of directors, we report that none of the directors are disqualified as on 31st March 2012 from being appointed as a director in terms of under clause (g) of sub section (1) of sect ion 274 of the companies act, 1956;

vi) In our opinion and to the best of our information and according to the explanations given to us, the said accounts together with its notes and Accounting Polices give the information required by the companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India;

a) In the case of the Balance Sheet, of the state of affairs of the company as at 31st March, 2012 and

b) In the case of the Statement of Profit and Loss, of the profit for the year ended on that date.

c) In case of Cash Flow Statement, of the cash flows for the period ended on that date.

ANNEXURE TO THE AUDITOR'S REPORT REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE

i) a) The company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

b) The Company has a program of Physical verification of Fixed Assets over a three year period. No material discrepancies were noticed by the company upon verification.

c) During the year, the Company has not disposed off any substantial part of Fixed Assets.

ii) a) The inventory has been physically verified during the year by the management.

In our opinion, the frequency of verification is reasonable.

b) The procedure of physical verification of inventory followed by the management, are reasonable and adequate in relation to the size of the Company and the nature of its business.

c) The company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification.

iii) a) According to the information and explanations given to us, the Company has granted interest free loans to HCL Agro Power Ltd Company covered under the register maintained u/s.301 of the Companies Act, 1956. The Maximum amount outstanding during year is Rs. 1287.31 Lakhs and the yearend balance is Rs.1287.31 Lakhs.

b) In our opinion and according to the explanation given to us, the aforesaid loan is interest free and other terms and conditions of the loan given are not prima facie prejudicial to the interest of the Company.

c) The said Interest free loan has no repayment schedule.

d) The loan given by the company is repayable on Demand.

e) According to the information and explanations given to us, the Company has taken interest free loan from one party covered under the register maintained u/s.301 of the Companies Act, 1956. The maximum amount outstanding during the year is Rs.19.84 Lakhs and the yearend balance is Rs. 19.84 lakhs.

f) In our opinion and according to the explanation given to us, the aforesaid loan is interest free and other terms and conditions of the loan taken are not prima facie prejudicial to the interest of the Company.

g) The loans taken are re-payable on demand. As informed, the lenders have not demanded repayment of any such loan during the year, thus, there has been no default on the part of the company. The loan given is interest free.

iv) In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets, for sale of goods and services

v) a) In our opinion and according to the information and explanations given to us, the transactions that need to be entered into the register in pursuance of Section 301 of Companies Act have been so entered.

b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered into the register in pursuance of Section 301 of the Companies Act, 1956, in respect of any party during the year, have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi) The Company has not accepted any deposits from public within the meaning of Section 58A and 58AA or any other provisions of the Companies Act and the rules framed there under, hence the paragraph (4) (vi) is not applicable to the company for the year;

vii) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.

viii) We have broadly reviewed the books of account and records maintained by the company pursuant to the Rules made by the Central Government for the maintenance of Cost Records under section 209(1 )(d) of the Companies Act,1956 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

ix) a) According to the records of the Company, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues of Income tax, Provident fund, Employee state Insurance Sales tax, VAT, Wealth Tax, Excise duty, Customs duty, Investor Education and protection Fund, Cess etc. as applicable with appropriate authorities.

b) According to the information and explanations given to us, no undisputed amounts payable in respect of Income tax, Provident fund, Employee state Insurance, Sales tax, VAT, Wealth Tax, Excise duty, Customs duty, Investor Education and protection Fund, Cess etc. were outstanding as at 31st March, 2012 for a period of more than six months from the date they became payable.

c) According to the information and explanation given to us, there are no dues of Income tax, Customs duty, Wealth tax, Service tax, Excise duty which have not been deposited on account of any dispute except for

Forum where S. No. Nature of the Dosputes Amount Dues pending

Sales Tax Appellate

1 AP VAT Teibunal, Vizage, 20.06 Lakhs Appeal no. VJA 1/41/08-09

Period to Which Status of amount relates Payment

Status of

2006-07 Payment

x) The company has no accumulated losses at the end of the financial year and it has not incurred cash losses in the current and immediately preceding financial year.

xi) The Company has no borrowings from Financial Institutions, Banks or Debentures and hence we have no comments to offer.

xii) According to the information and explanations given to us, the Company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures or other securities.

xiii) The provisions of special statute applicable to Chit Fund, Nidhi or Mutual Benefit fund/Society are not applicable to the company.

xiv) The nature of Company's business/activities during the year does not include dealing in shares, securities, debentures or other investments, hence the requirement of offering comments on this clause is not applicable.

xv) According to the information and explanations given to us and records made available to us, the company has not given any guarantee for loans taken by others from bank or financial institutions, hence the terms and conditions of guarantees given by the Company is not applicable for the year.

xvi) According to the information and explanations given to us, no term loans were availed by the Company during the year. Accordingly, clause 4(xvi) of the companies (Auditor's Report) Order 2003 is not applicable to the company.

xvii) According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that the Company has not raised any funds during the year; as such this clause is not applicable.

xviii) The Company has not made preferential allotment of shares to parties and Companies covered in the register maintained under section 301 of the Companies Act, 1956.

xix) During the period covered by our audit report, the Company has not issued any debentures requiring report under the clause.

xx) The Company has not raised any money by way public issue during the year and hence the question of disclosure and verification of end use of such moneys does not arise.

xxi) Based upon the audit procedures performed and information and explanations given by the Management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.

For B.PURUSHOTTAM & CO CHARTERED ACCOUNTANTS (FIRM REGN. No. 002808S)

B.S. PURSHOTHAM

Place : Chennai. PARTNER

Date : 06.08.2012. M N0 026785

---

Mar 31, 2011

1) We have audited the attached Balance Sheet of HEMADRI CEMENTS LIMITED., as at 31st March 2011, Profit and Loss Account and Cash Flow Statement for the year ended on that date annexed thereto. These financial Statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

2) We conducted our audit in accordance with the auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3) As required by the Companies (Auditor's Report) order, 2003 issued by the Central Government of India in terms of Sub-section (4A) of Section 227 of the companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said order.

4) Further to our comments in the Annexure referred to above, we report that:

i) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit;

ii) In our opinion, proper books of account as required by law have been kept by the company so far as appears from our examination of those books;

iii) The Balance Sheet .Profit and Loss account and Cash Flow Statement dealt with by this report are in agreement with the books of account;

iv) In our opinion, the Balance Sheet, Profit and Loss account and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies act, 1956

v) on the basis of written representations received directors of the company as at 31st March, 2011 and taken on record by the board of directors, we report that none of the directors are disqualified as on 31st March 2011 from being appointed as a director in terms of under clause (g) of sub section (1) of sect ion 274 of the companies act, 1956;

vi) In our opinion and to the best of our information and according to the explanations given to us, the said accounts together with its notes and Accounting Polices give the information required by the companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India;

a) In the case of the Balance Sheet, of the state of affairs of the company as at 31st March, 2011 and

b) In the case of the Profit and Loss Account, of the profit for the year ended on that date.

c) In case of Cash Flow Statement, of the cash flows for the period ended on that date.

ANNEXURE TO THE AUDITOR'S REPORT

(Referred to in paragraph 3 of our report even date)

i) a) The company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

b) All the assets have been physically verified by the Management during the year and no material discrepancies were noticed on such verification.

c) During the year, the Company has not disposed off any substantial part of Fixed Assets.

ii) a) The inventory has been physically verified during the year by the management.In our opinion, the frequency of verification is reasonable.

b) The procedure of physical verification of inventory followed by the management, are reasonable and adequate in relation to the size of the Company and the nature of its business.

c) The company is maintaining proper records of inventory and no material discrepancies were J noticed on physical verification.

iii) a) According to the information and explanations given to us, the Company has granted interest free loans to HCL Agro Power Ltd Company covered under the register maintained u/s.301 of the Companies Act, 1956. The Maximum amount outstanding during year is Rs.938.22 Lakhs and the yearend balance is Rs.938.22 Lakhs.

b) In our opinion and according to the explanation given to us, the aforesaid loan is interest free and other terms and conditions of the loan given are not prima facie prejudicial to the interest of the Company.

c) The said Interest free loan has no repayment schedule.

d) The loan given by the company is repayable on Demand.

e) According to the information and explanations given to us, the Company has not taken loans from parties covered under the register maintained u/s.301 of the Companies Act, 1956. Hence we have no comments to offer under clause (iii)f.

iv) In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business for the purchase of inventory and fixed assets, for sale of goods and services

v) a) In our opinion and according to the information and explanations given to us, the transactions that need to be entered into the register in pursuance of Section 301 of Companies Act have been so entered.

b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered into the register in pursuance of Section 301 of the Companies Act, 1956, in respect of any party during the year, have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

vi) The Company has not accepted any deposits from public within the meaning of Section 58A and 58AA or any other provisions of the Companies Act and the rules framed there under, hence the paragraph (4) (vi) is not applicable to the company for the year;

vii) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.

viii) We have broadly reviewed the books of account and records maintained by the company pursuant to the Rules made by the Central Government for the maintenance of Cost Records under section 209(1)(d) of the Companies Act,1956 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained.

ix) a) According to the records of the Company, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues of Income tax, Provident fund, Employee state Insurance, Sales tax, VAT, Wealth Tax, Excise duty, Customs duty, Investor Education and protection Fund, Cess etc. as applicable with appropriate authorities.

b) According to the information and explanations given to us, no undisputed amounts payable in respect of Income tax, Provident fund, Employee state Insurance,Sales tax, VAT, Wealth Tax, Excise duty, Customs duty, Investor Education and protection Fund, Cess etc. were outstanding as at 31s1 March, 2011 for a period of more than six months from the date they became payable.

c) According to the information and explanation given to us, there are no dues of Income tax, Customs duty, Wealth tax, Service tax, Excise duty which have not been deposited on account of any dispute except for :-

S.No. Nature of Forum where Amount Period to Status of the Dues Dispute is (Rs.) which Payment pending amount relates

1 AP VAT Sales Tax 20.06. 2006-07 - Appellate Lakshs Tribunal, Vizag Appeal no.VJA 1/41/08-09

x) The company has no accumulated losses at the end of the financial year and it has not incurred cash losses in the current and immediately preceding financial year. The Company has been discharged from the purview of Sick Indiustrial Companies (Special Provisions ) Act, 1985 vide the order of the Hon'ble BIFR dated 27.7.2011.

xi) Based on our audit procedures and according to the information and explanation given to us, we are of the opinion that the company has not defaulted in repayment of dues to Financial Institutions, banks or debenture holders.

xii) According to the information and explanations given to us, the Company has not granted any loans or advances on the basis of security by way of pledge of shares, debentures or other securities.

xiii) The provisions of special statute applicable to Chit Fund, Nidhi or Mutual Benefit fund/Society are not applicable to the company.

xiv) The nature of Company's business/activities during the year does not include dealing in shares, securities, debentures or other investments, hence the requirement of offering comments on this clause is not applicable.

xv) According to the information and explanations given to us and records made available to us, the company has not given any guarantee for loans taken by others from bank or financial institutions, hence the terms and conditions of guarantees given by the Company is not applicable for the year.

xvi) According to the information and explanations given to us, no term loans were availed by the Company during the year. Accordingly, clause 4(xvi) of the companies (Auditor's Report) Order 2003 is not applicable to the company.

xvii) According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company, we report that the Company has not raised any funds during the year; as such this clause is not applicable.

xviii) The Company has not made preferential allotment of shares to parties and Companies covered in the register maintained under section 301 of the Companies Act, 1956.

xix) During the period covered by our audit report, the Company has not issued any debentures requiring report under the clause.

xx) The Company has not raised any money by way public issue during the year and hence the question of disclosure and verification of end use of such moneys does not arise.

xxi) Based upon the audit procedures performed and information and explanations given by the Management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.

For B.PURUSHOTTAM & CO Chartered Accountants FIRM REG. No. 0028085

D. RAMASUDHAKAR PARTNER M.No. 220964

Place : Chennai. Date : 10.08.2011.

---

Mar 31, 2010

1. We have audited the attached Balance sheet of M/s. HEMADRI CEMENTS LIMITED as at 31st March 2010, and also the Profit & Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We have conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003, as amended by the Companies (Auditors Report) (Amendment) Order, 2004, (together the Order) issued by the Central Government Of India, in terms of Section 227 (4A) of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in the paragraphs 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to in paragraph 3 above;

a. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit;

b. In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of the books of the Company;

c. The Balance Sheet and Profit and Loss Account dealt with by this report are in agreement with the books of account;

d. In our opinion, the Balance Sheet and Profit and Loss Account dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956;

e. On the basis of the written representations received from the Directors as on 31st March, 2010 and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on 31st March, 2010 from being appointed as Director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956;

f. In our opinion, and to the best of our information and according to the explanations given to us, the said accounts, read together with the Companys Accounting Policies and Notes hereto, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India;

i. In the case of the Balance Sheet, of the state of affairs of the company as on 31st March, 2010; ii. In the case of the Profit and Loss Account, of the Profit of the Company for the year ended on that date;

And

iii. In case of cash flow statement, of the cash flows for the year ended on that date.

ANNEXURE TO THE AUDIT REPORT:

(Referred to in paragraph 3 of our report of even date)

i. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

(b) A substantial portion of the fixed assets has been physically verified by the management during the year and in our opinion frequency of verification is reasonable having regard to the size of the company and the nature of its assets. No material discrepancies were noticed on such physical verification.

(c) In our opinion, the company has not disposed off a substantial part of its fixed assets during the year and the going concern of the company is not affected.

ii. (a) The inventories have been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

(b) In my opinion and according to the information and explanations given to me, the procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) In my opinion and according to the information and explanations given to us and on the basis of our examination of the records of inventory, the Company is maintaining proper records of inventory. The discrepancies noticed on physical verification of inventory as compared to the books of account were not material and have been properly dealt with in the books of account.

iii. (a) According to the information and explanations given to us, during the year the Company has granted interest free demand loans to HCL Agro power ltd company covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount outstanding during the year is Rs.714.64 Lakhs and the year-end balance is Rs. 701.09 Lakhs.

(b) In our opinion and according to the information and explanations given to us, the aforesaid is interest free and other terms and conditions of the loans given are not prima facie prejudicial to the interest of the company.

(c) The said interest free loan has no repayment schedule.

(d) The loan given by the company is repayable on demand.

(e) According to the information and explanations given to us, during the year the Company has not taken any loans secured or unsecured from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, clauses (iii) (f) and (iii) (g) of the paragraph 4 of the Order are not applicable.

iv. In our opinion and according to the information and explanations given to us, there are

adequate internal control procedures commensurate with the size of the company and nature of its business with regard to the purchase of inventory and fixed assets, and with regard to the sale of goods and services. During the course of our audit, no major weaknesses have been noticed in the internal controls.

v. (a) Based on the audit procedures applied by us and according to the information and explanations provided by the management, we are of the opinion that, the transactions that need to be entered into the register maintained under Section 301 of the Companies Act, 1956 are so entered.

vi. In our opinion and according to the information and explanations given to us, the company

has not accepted deposits from the Public within the meaning of Section 58A and 58AA of the Companies Act, 1956 and the rules framed there under.

vii. In our opinion, the company has internal audit system commensurate with the size and the nature of its business.

viii. In respect of this company, maintenance of cost records has been prescribed by the Central Government under Section 209 (1) (d) of the Companies Act, 1956, and the same is being maintained.

ix. (a) According to the records of the company, information and explanations given to us, the undisputed statutory dues with respect to Provident Fund, investor education and protection fund, Employees State Insurance, income tax, sales-tax, wealth tax, customs duty, excise duty, cess, service tax and other statutory dues, to the extent applicable, have generally been regularly deposited with the appropriate authorities though there has been a slight delay in a few cases.

(b) According to the information and explanations given to us the following amounts have not been deposited with the appropriate authorities on account of dispute:

Name of the Amount Period to which the Forum where the RS. in Case is Pending Statute Lakhs amount relates

Sales Tax Appellate Tribunal, Vizag APVAT 20.06 2006-07 Appeal no.VJA 1/41/08-09

x In our opinion, the Company does not have accumulated losses as at the end of financial year and has not incurred any cash losses during the current financial year and in the immediately preceding financial year.

xi. In our opinion and based on the information available, during the year the Company has

not defaulted in repayment of dues to the financial institutions or banks.

xii. According to the information and explanations given to us, the company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities. Accordingly, clause 4(xii) of the companies (Auditors Report) Order 2003 is not applicable to the company.

xiii. In our opinion, the Company is not a Chit fund or a Nidhi/Mutual Benefit fund/ Society.

Therefore, the provisions of clause 4 (xiii) of the Companies (Auditors Report) Order 2003 are not applicable to the company.

xiv. In our opinion, the Company is not dealing in or trading in Shares, Securities, debentures and other investments, accordingly, the provisions of clause 4 (xiv) of the Companies (Auditors Report) Order 2003 are not applicable to the company.

xv. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks and financial institutions during the year.

xvi. According to the information and explanations given to us, no term loans were availed by the Company during the year. Accordingly, clause 4(xvi) of the companies (Auditors Report) Order 2003 is not applicable to the company.

xvii. According to the information and explanations given to us and on an overall examination of

Balance Sheet, the company has not raised any funds during the year; as such this clause is not applicable.

xviii. The company has not made any preferential allotment to parties and companies covered

under register maintained under section 301 of the Companies Act, 1956, during the year.

xix. According to the information and explanations given to us and the records examined by us, no debentures were issued by the company.

xx. The Company has not raised any money through public issue during the year.

xxi. To the best of our knowledge and belief and according to the information and explanations given to us, no fraud on or by the Company was noticed or reported during the year.

for KARVY& COMPANY

Chartered Accountants

(Regd. No. 001757S)

Place: Hyderabad (K. AJAY KUMAR)

Date : Date:26.11.2010 PARTNER

(M.No.21989)