Auditor Report of Aurobindo Pharma Ltd.

Mar 31, 2025

Sr. No.	Key Audit Matter	Auditor''s Response
1	Revenue recognition — Refer to note 2.2(c) and 20 of the Standalone Financial Statements: The Company recognises revenue from sale of pharmaceutical products based on the shipping terms which varies with different customers which defines the timing of the transfer of control to the customer. For revenue recognized during the period near to the Balance Sheet date, it is essential to ensure that the control of goods have transferred to the customers. Dispatch of goods to the customer''s location happens from multiple locations including factories, warehouses, and third-party locations.	Principal audit procedures performed: • Evaluated the Company''s revenue recognition policy and assessed compliance with the Indian Accounting Standard (Ind AS). • Obtained an understanding of the revenue recognition process and evaluated the design and tested the implementation and operating effectiveness of the Company''s Internal controls around the timely and accurate recording of sales transactions including controls around the identification and reversal of cut-off sales. • The Company recognises the revenue upon the transfer of control of goods to the customer in the ERP system. Accordingly, we have tested the General information technology controls around the system including access and change management controls of such ERP system.

Sr. No.	Key Audit Matter	Auditor''s Response
	We consider Cut-off of Revenue recognition	•	Basis of the sales recorded during the year,
	from sale of pharmaceutical products as a key		performed a lead time analysis to arrive at the
	audit matter due to the varied shipping terms,		average lead time taken for transfer of control to
	which define the timing of transfer of control and		the customers from the date of dispatch, against the
	satisfaction of performance obligation.		various shipping terms.
		•	We selected samples from invoices recorded during such lead sales time immediately before the balance sheet date and obtained evidence of delivery to support the revenue recognition/reversal of revenue as applicable
2	Assessment of impairment of investments in	Principal audit procedures performed:
	and unsecured loans given to subsidiaries — Refer to note 2.1(d)(v), 4 and 5 of the Standalone Financial Statements.	•	Evaluated the design, tested the implementation and operating effectiveness of the internal controls over impairment assessment process, including
	The carrying value of investments in and unsecured		those over the forecasts and the selection of the
	loans given to certain subsidiaries is '' 37,213 million.		appropriate discount rate.
	The Company performs annual assessment to	•	Evaluated the impairment indicator assessment
	identify any indicators of impairment. Based		performed by the Company considering quantitative
	on internal and external factors considered,		and qualitative factors.
	where such evidence exists, impairment loss is determined and recognised in accordance with note 2.1(d)(v) of accounting policies to the Standalone Financial Statements.	•	Evaluated and challenged management''s assumptions such as growth rates forming basis of forecasted financials, terminal growth rate, and discount rate for their appropriateness based on
	The Company''s evaluation of impairment of		our understanding of the business of the respective
	its investments involves comparison of their		investments including past results and external
	recoverable value to their corresponding carrying		factors such as industry trends and forecasts.
	values. The Company used the discounted cash flow model to estimate recoverable values, which requires management to make estimates and assumptions related to forecasts of future Revenues, operating margins, and discount rates. Changes in these assumptions could have a significant impact	•	Performed sensitivity analysis around these key estimates to ascertain the extent of change in those assumptions that either individually or collectively would be required for the investments and loans tested were to be impaired.
	on either the recoverable value, the amount of any	•	Tested the mathematical accuracy of the model to
	impairment charge, or both.		conclude that the model is accurately calculating the
	We have considered this as a Key Audit Matter due		value in use.
	to the materiality of the investment, and because the	•	Evaluated the adequacy of disclosures made in the
	Company''s assessment of the recoverable values involves judgements around the future results of the business and the discount rates applied to future cash flow forecasts.		Standalone Financial Statements.

We have audited the accompanying Standalone
Financial Statements of Aurobindo Pharma Limited (the
"Company"), which comprise the Balance Sheet as at
March 31, 2025, and the Statement of Profit and Loss
(including Other Comprehensive Income), the Statement
of Cash Flows and the Statement of Changes in Equity
for the year ended on that date, and notes to the financial
statements, including a summary of material accounting
policies and other explanatory information.

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 Section 133 of the Act, ("Ind AS") and
other accounting principles generally accepted in India, of
the state of affairs of the Company as at March 31, 2025,
and its profit, total 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 Standalone Financial
Statements in accordance with the Standards on
Auditing ("SA"s) specified under Section 143(10) of the
Act. Our responsibilities under those Standards are
further described in the Auditor''s Responsibility 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 ethical requirements that are relevant to our audit of
the Standalone Financial Statements under the provisions
of the Act and the Rules made 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 obtained by us is sufficient
and appropriate to provide a basis for our audit opinion
on the Standalone 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
Standalone Financial Statements of the current period.
These matters were addressed in the context of our audit
of the Standalone 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
the matters described below to be the key audit matters
to be communicated in our 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 & analysis, Board''s Report,
Business Responsibility and Sustainability report and
Report on Corporate Governance including annexure,
but does not include the consolidated financial
statements, 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.

• I f, 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.

RESPONSIBILITIES OF MANAGEMENT AND BOARD
OF DIRECTORS FORTHE STANDALONE FINANCIAL
STATEMENTS

The Company''s Board of Directors is responsible
for the matters stated in Section 134(5) of 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, cash flows and changes in
equity of the Company in accordance with the accounting
principles generally accepted in India, including 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 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.

In preparing the Standalone Financial Statements,
management and Board of Directors 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 the Board of Directors either intend to liquidate
the Company or to cease operations, or has no realistic
alternative but to do so.

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

AUDITOR''S RESPONSIBILITY FOR THE AUDIT OF
THE STANDALONE FINANCIAL STATEMENTS

Our objectives are to obtain reasonable assurance about
whether the Standalone 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 Standalone 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 Act, we are also
responsible for expressing our opinion on whether
the Company has adequate internal financial controls
with reference to Standalone Financial Statements 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 the 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
Standalone 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 Standalone
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 financial controls
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 Standalone Financial
Statements of the current period 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 Section 143(3) of the Act, based on our

audit 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 including Other Comprehensive Income,
the Statement of Cash Flows 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 Ind AS
specified under Section 133 of the Act.

e) On the basis of the written representations
received from the directors as on March 31,2025
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 with reference to Standalone
Financial Statements of the Company and the
operating effectiveness of such controls, refer
to our separate Report in "Annexure A''. Our
report expresses an unmodified opinion on
the adequacy and operating effectiveness of
the Company''s internal financial controls with
reference to Standalone Financial Statements.

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, as amended in our 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 Standalone Financial Statements
- Refer Note 30C to the Standalone
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 has been no delay in transferring
amounts, required to be transferred, to the
Investor Education and Protection Fund by
the Company.

iv. (a) The Management has represented

that, to the best of its knowledge and
belief, as disclosed in the note 51(v) to
the financial statements no funds 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(s) or entity(ies), including
foreign entities ("Intermediaries"),
with the understanding, whether
recorded in writing or otherwise,
that the Intermediary shall, 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 51(vi)
to the financial statements, no funds
have been received by the Company
from any person(s) or entity(ies),
including foreign entities ("Funding
Parties"), with the understanding,
whether recorded in writing or
otherwise, that the Company shall,
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
performed 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 has not declared or paid
any dividend during the year and has not
proposed final dividend for the year.

vi. Based on our examination, which included
test checks, the Company has used
accounting software for maintaining its
books of account for the financial year ended
March 31, 2025 which have the 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 the audit trail feature being
tampered with.

Additionally audit trail has been preserved
by the Company as per the statutory
requirements for record retention.

2. As required by the Companies (Auditor''s Report)
Order, 2020 ("the Order") issued by the Central
Government in terms of Section 143(11) of the Act,
we give in "Annexure B" a statement on the matters
specified in paragraphs 3 and 4 of the Order.

For Deloitte Haskins & Sells

Chartered Accountants
Firm''s Registration No. 008073S

C Manish Muralidhar

Partner

Place: Hyderabad Membership No. 213649

Date: May 26, 2025 UDIN: 25213649BMOENK1096

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Mar 31, 2024

We have audited the accompanying standalone financial statements of Aurobindo Pharma Limited ("the Company”), which comprise the Balance Sheet as at March 31, 2024, and the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Cash Flows and the Statement of Changes in Equity for the year ended on that date, and notes to the financial statements, including a summary of material accounting policies and other explanatory information.

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 Section 133 of the Act, ("Ind AS”) and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2024, and its profit, total 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 standalone financial statements in accordance with the Standards on Auditing ("SAs”) specified under Section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditor''s Responsibility 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 ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules made 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 obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the standalone financial statements.

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone 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 the matters described below to be the key audit matters to be communicated in our report.

Sr N0 Key Audit Matter

Auditor''s Response

1. Revenue recognition - Refer to note 20 of the Standalone financial statements: Refer to Note 2.2(c) of the summary of material accounting policies. The Company recognises revenue from sale of Pharmaceutical products based on the shipping terms which varies with different customers which defines the timing of the transfer of control to the customer. For revenue recognized during the period near to the Balance Sheet date, it is essential to ensure that the control of goods have transferred to the customers. Dispatch of goods to the customer''s location happens from multiple locations including factories, warehouses and third-party locations. Revenue recognition being subject to the manual exercise of tracking the evidence of delivery and ascertaining the revenue recognition date against each invoice, we identified the Cut-off of revenue as a key audit matter

Principal audit procedures performed: • Evaluated the Company''s revenue recognition policy and assessed compliance with the Indian Accounting Standard (Ind AS). • Obtained an understanding of the revenue recognition process and evaluated the design and tested the implementation and operating effectiveness of the Company''s Internal controls around the timely and accurate recording of sales transactions including controls around the identification and reversal of cut-off sales. • The Company recognises the revenue upon the transfer of control of goods to the customer in the ERP system. Accordingly, we have tested the General information technology controls around the system. • Tested the access and change management controls of the relevant information technology system in which shipments are recorded. • Basis of the sales recorded during the year, performed a lead time analysis to arrive at the average lead time taken for transfer of control to the customers from the date of dispatch, against the various shipping terms. • We selected samples from invoices recorded during such lead sales time immediately before the balance sheet date and obtained evidence of delivery to support the revenue recognition/reversal of revenue as the case may be.

Sr. No.	Key Audit Matter	Auditor''s Response
2.	Assessment of impairment of investments in and unsecured loans given to subsidiaries and joint ventures - Refer to Notes 4 and 5 of the standalone financial statements. Refer to note 2.1(d)(v) of the summary of material accounting policies. The carrying value of investments in and unsecured loans given to certain subsidiaries is 5 27,480 million. The Company performs annual assessment of investments to identify any indicators of impairment. Based on internal and external factors considered, where such evidence exists, impairment loss is determined and recognised in accordance with note 2.1(d)(v) of accounting policies to the standalone financial statements. The Company''s evaluation of impairment of its investments involves comparison of their recoverable value to their corresponding carrying values. The Company used the discounted cash flow model to estimate recoverable values, which requires management to make estimates and assumptions related to forecasts of future Revenues, operating margins, and discount rates. Changes in these assumptions could have a significant impact on either the recoverable value, the amount of any impairment charge, or both.	Principal audit procedures performed: • Evaluated the design, tested the implementation and operating effectiveness of the internal controls over impairment assessment process, including those over the forecasts made and the selection of the appropriate discount rate. • Evaluated the impairment indicator assessment performed by the Company considering quantitative and qualitative factors. • Evaluated the reasonableness of the Management''s estimates and judgements through discussion with management and by comparing the forecasts to historical revenues, margins, growth rate etc. • Where necessary, obtained the assistance of our internal fair value specialists, evaluated the reasonableness of the valuation methodology, discount rate and other key business assumptions used in the assessment. • Tested the mathematical accuracy of the model to conclude that the model is accurately calculating the value in use. • Performed sensitivity analysis around these key estimates to ascertain the extent of change in those assumptions that either individually or collectively would be required for the investments and loans tested were to be impaired. • Evaluated the adequacy of disclosures made in the standalone financial statements.
	We considered this as a Key Audit Matter due to the materiality of the investment, and because the Company''s assessment of the recoverable values involves judgements around the future results of the business and the discount rates applied to future cash flow forecasts.
3.	Litigation, Claims and Contingent Liabilities - Refer to note 30 of the standalone financial statements. Refer to Note 2.2(m) of the summary of material accounting policies. The Company is involved in various legal proceedings including, product liability, contracts, investigations, disputed taxes and other regulatory matters relating to conduct of its business. Most of the claims involve complex legal and regulatory issues. The Company, assisted by their external legal counsel assesses the need to make provision or disclose a contingency on a case-to-case basis considering the underlying facts of each litigation. The Company''s conclusions may result in an incorrect Provision or disclosure in the Standalone financial statements considering the aforesaid assessment involves significant judgement to be exercised by the Company based on current developments. Further, unexpected adverse outcomes could also significantly impact the Company''s reported results. Given the different views possible, basis the interpretations, complexity and the magnitude of the potential exposures, and the judgement necessary to determine required disclosures, this is a key audit matter.	Principal audit procedures performed: • Understood the process, evaluated the design and implementation of controls and tested the operating effectiveness of the Company''s controls over the recording and assessment of uncertain legal positions, claims & contingent liabilities. • Held discussions with management including the person responsible for legal & compliance to obtain an understanding of the factors considered by management in classification of the matter as probable, possible and remote. • Examined the Company''s legal expenses on sample basis and read the minutes of the board meetings in order to ensure completeness. • Circulated obtained and read legal confirmations from Company''s external legal counsels in respect of material litigations and considered probability assessment of the outcomes. • Examined documents in the Company''s possession concerning litigation and claims, legal advice/opinion received by the Company. Obtained corroborative evidence to confirm the status & existence of the litigation. • Evaluated the adequacy of disclosures made in the standalone financial statements.

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 & analysis, Board''s Report, Business Responsibility and Sustainability report and Report on Corporate Governance including annexures, but does not include the consolidated financial statements, 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.

Responsibilities of Management and Those Charged with Governance for the Standalone Financial Statements

The Company''s Board of Directors is responsible for the matters stated in Section 134(5) of 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, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including 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 the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgements 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.

In preparing the standalone financial statements, management and Board of Directors 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 the Board of Directors either intend to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

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

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

Our objectives are to obtain reasonable assurance about whether the standalone 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 judgement and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the standalone 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)0) of the Act, we are also responsible for expressing our opinion on whether the

Company has adequate internal financial controls with reference to standalone financial statements 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 the 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 standalone 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 standalone 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 financial controls 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 standalone financial statements of the current period 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 Section 143(3) of the Act, based on

our audit 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, except for matters stated in (i)

(iv) below.

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

of account.

d) In our opinion, the aforesaid standalone financial statements comply with the Ind AS specified under Section 133 of the Act.

e) On the basis of the written representations received from the directors as on March 31,

2024 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.

believe that the representations unde sub-clause (i) and (ii) of Rule 11 (e), as provided under (a) and (b) above, contain any material misstatement.

v. The interim dividend declared and paid by the Company during the year and until the date of this report is in accordance with Section 123 of the Act, as applicable.

vi. Based on our examination, the Company has used accounting software for maintaining its books of account for the financial year ended March 31, 2024 which have 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 the audit trail feature being tampered with.

f) The modification relating to the maintenance of accounts and other matters connected therewith, is as stated in paragraph (b) above.

g) With respect to the adequacy of the internal financial controls with reference to standalone financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure A”. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company''s internal financial controls with reference to standalone financial statements.

h) 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.

i) 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, as amended in our 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 standalone financial statements

- Refer Note 30(c) to the standalone 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 has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

iv. (a) The Management has represented

that, to the best of its knowledge and belief, other than as disclosed in the note 51(v) to the standalone financial statements no funds 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(s) or entity(ies), including foreign entities ("Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, 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, other than as disclosed in the note 51 (vi) to the standalone financial statements, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities ("Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the Company shall, 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 performed that have been considered reasonable and appropriate in the circumstances, nothing has come

to our notice that has caused us to

As proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 is applicable from April 1, 2023, reporting under 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.

2. As required by the Companies (Auditor''s Report) Order, 2020 ("the Order”) issued by the Central Government in terms of Section 143(11) of the Act, we give in "Annexure B” a statement on the matters specified in paragraphs 3 and 4 of the Order.

For Deloitte Haskins & Sells

Chartered Accountants (Firm''s Registration No. 008072S)

C Manish Muralidhar

(Partner)

Place: Hyderabad (Membership No. 213649)

Date: May 25, 2024 (UDIN: 24213649BKCJGF1724)

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Mar 31, 2023

To The Members of AUROBINDO PHARMA LIMITED Report on the Audit of the Standalone Financial Statements

OPINION

We have audited the accompanying standalone financial statements of AUROBINDO PHARMA LIMITED (“the Company”), which comprise the Balance Sheet as at March 31, 2023, and the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Cash Flows and the Statement of Changes in Equity for the year then ended, and 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 section 133 of 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, and its profit, total 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 standalone financial statements in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditor’s Responsibility 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 ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules made 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 obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the standalone 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 standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone 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 the matters described below to be the key audit matters to be communicated in our report.

Sr. No.	Key Audit Matter	Auditor’s Response
2	Inventory Existence and Valuation — Refer to Note 11 of the	Principal audit procedures performed:
	Standalone financial statements:	• Evaluated the Company’s inventory accounting policies and
	Refer to Note 2.2(g) of the summary of significant accounting policies.	assessing compliance with the relevant accounting standards. • Evaluated the design and testing the implementation and
	The carrying value of inventories as at March 31, 2023 is ''41,252.6 million.	operating effectiveness of the Company’s internal controls
		over physical verification of inventory, inventory valuation
	Inventories are located at multiple locations including factories, warehouses and third party locations.	and accounting. • Evaluated the design, implementation and operating effectiveness
	Inventories are valued at lower of cost, determined on weighted average basis and net realisable value. Raw material costs	of general IT controls and key application controls over the
	include cost of purchase and other costs incurred in bringing the	Company’s IT systems including those relating to recording of
	inventories to their present location and condition. Finished goods and work-in-progress costs include direct	inventory quantities on occurrence of each transaction, including access controls, controls over program changes.
	material, labour and a proportion of manufacturing overheads	• For the selected locations, observed the physical verification
	based on the normal operating capacity.	conducted by management near to the year end and tested
	Inventory valuation is carried out across the units in excel	the roll forward procedures performed by management on a
	spreadsheets based on the quantitative inputs extracted from	sample basis.
	the books of accounts.	• Tested the costs as calculated by the management on a
	Existence and Valuation of Inventory has been considered as a	sample basis by verifying underlying records such as purchase
	key audit matter due to:	invoices, cost sheets, overhead allocations and capacity
	a. Significance of the inventory balance to the total assets as	utilization certificates.
	per standalone financial statements.	• Compared the cost of the Raw material, Finished goods and Work
	b. Multiple locations that inventory is held at.	In Progress with the estimated net realizable value and checked
	c. Valuation of inventory in a non-automated environment, and	if those inventories were recorded at net realizable value where
	the resultant likelihood of material misstatement resulting from errors in computation.	the cost was higher than the net realizable value.
3	Assessment of impairment of investments in and unsecured	Principal audit procedures performed:
	loans given to subsidiaries and joint ventures — Refer to Note 4 of the standalone financial statements	• Evaluated the design, tested the implementation and operating effectiveness of the internal controls over impairment assessment
	Refer to note 2.1(d)(v) of the summary of significant accounting	process, including those over the forecasts made and the
	policies.	selection of the appropriate discount rate.
	The carrying value of investments in and unsecured loans given to certain subsidiaries and joint ventures is ''50,462 million. The Company performs annual assessment of investments to	• Evaluated the impairment indicator assessment performed by the Company considering quantitative and qualitative factors.
	identify any indicators of impairment. Based on internal and	• Evaluated the reasonableness of the Management’s estimates
	external factors considered, where such evidence exists,	and judgements through discussion with management and by
	impairment loss is determined and recognised in accordance	comparing the forecasts to historical revenues, margins, growth
	with note 2.1(d)(v) of accounting policies to the standalone	rate etc.
	financial statements.	• With the assistance of our internal fair value specialists, evaluated
	The Company’s evaluation of impairment of its investments	the reasonableness of the valuation methodology, discount rate
	involves comparison of their recoverable value to their corresponding carrying values. The Company used the	and other key business assumptions used in the assessment.
	discounted cash flow model to estimate recoverable values,	• Tested the mathematical accuracy of the model to conclude that
	which requires management to make estimates and assumptions	the model is accurately calculating the value in use.
	related to forecasts of future Revenues, operating margins, and	• Performed sensitivity analysis around these key estimates to
	discount rates. Changes in these assumptions could have a	ascertain the extent of change in those assumptions that either
	significant impact on either the recoverable value, the amount of	individually or collectively would be required for the investments
	any impairment charge, or both.	and loans tested were to be impaired.
	We considered this as a Key Audit Matter due to the materiality of the investments, and because the Company’s assessment of	• Evaluated the adequacy of disclosures made in the standalone
	the recoverable values involves judgements around the future results of the business and the discount rates applied to future cash flow forecasts.	financial statements.

Sr. No.	Key Audit Matter	Auditor’s Response
1	Revenue recognition — Refer to note 20 of the Standalone financial statements: Refer to Note 2.2(c) of the summary of significant accounting policies. The Company recognises revenue from sale of API, Intermediates and Formulations based on the terms and conditions of transactions which varies with different customers which define the timing of the transfer of control to the customer. For revenue recognized during the period near to the Balance Sheet date, it is essential to ensure that the control of goods have transferred to the customers. Dispatch of goods to the customer’s location happens from multiple locations including factories, warehouses and third-party locations. Revenue recognition being subject to the manual exercise of tracking the evidence of delivery and ascertaining the revenue recognition date against each invoice, we identified the Cut-off of revenue as a key audit matter	Principal audit procedures performed: • Evaluated the Company’s revenue recognition policy and assessed compliance with the Indian Accounting Standard (Ind AS). • Obtained an understanding of the revenue recognition process and tested the company’s controls around the timely and accurate recording of sales transactions including controls around the identification and reversal of cut-off sales. • Tested the access and change management controls of the relevant information technology system in which shipments are recorded. • Basis of the sales recorded during the year, performed a lead time analysis to arrive at the average lead time taken for transfer of control to the customers from the date of dispatch, against the various INCOTERMS • We selected samples from invoices recorded during such lead sales time immediately before the balance sheet date and obtained evidence of delivery to support the revenue recognition / reversal of revenue as the case may be.

Sr. No.	Key Audit Matter	Auditor’s Response
4	Litigation, Claims and Contingent Liabilities - Refer to note 30 of the standalone financials statements. Refer to Note 2.2(m) of the summary of significant accounting policies. The Company is involved in various legal proceedings including, product liability, contracts, investigations, disputed taxes and other regulatory matters relating to conduct of its business. Most of the claims involve complex legal and regulatory issues. The Company, assisted by their external legal counsel assesses the need to make provision or disclose a contingency on a case-to-case basis considering the underlying facts of each litigation. The Company’s conclusions may result in an incorrect Provision or disclosure in the Standalone financial statements considering the aforesaid assessment involves significant judgement to be exercised by the Company based on current developments. Further, unexpected adverse outcomes could also significantly impact the Company’s reported results. Given the different views possible, basis the interpretations, complexity and the magnitude of the potential exposures, and the judgement necessary to determine required disclosures, this is a key audit matter.	Principal audit procedures performed: • Understood the process, evaluated the design and implementation of controls and tested the operating effectiveness of the Company’s controls over the recording and assessment of uncertain legal positions, claims & contingent liabilities. • Held discussions with management including the person responsible for legal & compliance to obtain an understanding of the factors considered by management in classification of the matter as probable, possible and remote. • Examined the Company’s legal expenses on sample basis and read the minutes of the board meetings in order to ensure completeness. • Circulated, obtained and read legal confirmations from Company’s external legal counsels in respect of material litigations and considered probability assessment of the outcomes. • Examined documents in the Company’s possession concerning litigation and claims, legal advice/opinion received by the company. Obtained corroborative evidence to confirm the status & existence of the litigation. • Evaluated the adequacy of disclosures made in the standalone financial statements.

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 & Analysis, Board’s Report, Business Responsibility and Sustainability Report and Report on Corporate Governance, including Annexures, but does not include the consolidated financial statements, 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 identified above 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.

RESPONSIBILITIES OF MANAGEMENT AND THOSE CHARGED WITH GOVERNANCE FOR THE STANDALONE FINANCIAL STATEMENTS

The Company’s Board of Directors is responsible for the matters stated in section 134(5) of 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, cash flows and changes in equity of the Company in accordance with the Ind AS and other accounting principles generally accepted in India. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding 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 standalone financial statement 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

the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

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

AUDITOR’S RESPONSIBILITY FOR THE AUDIT OF THE STANDALONE FINANCIAL STATEMENTS

Our objectives are to obtain reasonable assurance about whether the standalone 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 standalone 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 control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to standalone financial statements 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 the 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 standalone 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 standalone 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 of the standalone financial statements of the current period 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.

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 performed 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. a. The final dividend proposed in the previous year, declared and paid by the Company during the year is in accordance with section 123 of the Act, as applicable.

b. The interim dividend declared and paid by the Company during the year and until the date of this report is in accordance with section 123 of the Companies Act 2013.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

1. As required by Section 143(3) of the Act, based on our audit

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 including Other Comprehensive Income, the Statement of Cash Flows and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account.

d) I n our opinion, the aforesaid standalone financial statements comply with the Ind AS specified under Section 133 of the Act.

e) On the basis of the written representations received from the directors as on March 31, 2023 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 with reference to standalone financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure A”. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company’s internal financial controls with reference to standalone financial statements.

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, as amended in our 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 standalone financial statements (Refer note 30(c) to the standalone 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 has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

iv. a) The Management has represented that,

to the best of its knowledge and belief, other than as disclosed in the note 51 (v) to the standalone financial statements, no funds 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(s) or entity(ies), including foreign entities (“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, 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, other than as disclosed in the note 51 (vi) to the standalone financial statements, no funds have been received by the Company from any person(s) or entity(ies), including foreign entities (“Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the Company shall,

vi. Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014 for maintaining books of account using accounting software which has a feature of recording audit trail (edit log) facility is applicable to the Company w.e.f. April 1, 2023, and accordingly, reporting under Rule 11(g) of Companies (Audit and Auditors) Rules, 2014 is not applicable for the financial year ended March 31, 2023.

2. As required by the Companies (Auditor’s Report) Order, 2020 (“the Order”) issued by the Central Government in terms of Section 143(11) of the Act, we give in “Annexure B” a statement on the matters specified in paragraphs 3 and 4 of the Order.

For Deloitte Haskins & Sells

Chartered Accountants

(Firm’s Registration No. 008072S)

C Manish Muralidhar

(Partner)

(Membership No. 213649)

Place: Hyderabad

Date: May 27, 2023

UDIN: 23213649BGVBYS5552

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Mar 31, 2022

Report on the Audit of the Standalone Financial Statements

OPINION

We have audited the standalone financial statements of Aurobindo Pharma Limited (the “Company”), which comprise the standalone balance sheet as at March 31,2022, and the standalone statement of profit and loss (including other comprehensive income), standalone statement of changes in equity and standalone statement of cash flows for the year then ended, and notes to the standalone financial statements, including a summary of significant accounting policies and other explanatory information.

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 (“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 March 31, 2022, and its profit and other comprehensive income, changes in equity and its cash flows for the year ended on that date.

BASIS FOR OPINION

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under Section 143(10) of the Act. Our responsibilities under those SAs 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 together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our opinion on the standalone financial statements.

KEY AUDIT MATTERS

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone 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 the matters described below to be the key audit matters to be communicated in our report.

DESCRIPTION OF KEY AUDIT MATTER
Key audit matters	How the matter was addressed in our audit
Valuation of Investments in subsidiaries and joint venture [Refer note 2.1(d)(v) of the summary of significant accounting Policies and note 4 to the standalone financial statements] The carrying value of investments in the Company’s subsidiaries and joint venture entities as at March 31,2022 is ''65,584.5 million. The Company performs annual assessment of investments to identify any indicators of impairment. Based on internal and external factors considered, where such evidence exists, impairment loss is determined and recognised in accordance with note 2.1(d)(v) of accounting policies to the standalone financial statements. The impairment models use several key assumptions, including estimates of future sales volumes, prices, operational costs, terminal value growth rates; probability of regulatory and commercial success; expected cost to complete products under development and the weighted average cost of capital (discount rate). We identified the assessment of impairment indicators and resultant impairment losses in respect of investment in subsidiaries/joint venture as a key audit matter because of: • The significance of the amount of these investments in the Standalone Balance Sheet; and • The degree of inherent uncertainty, complexity and management judgement involved in determining whether there was objective evidence of impairment of investments.	Our audit procedures included the following: • Evaluating design, implementation and testing operating effectiveness of key controls over the impairment assessment process including forecasts made and valuation models used by the Company. • Assessing the valuation methodology used by the Company and testing the mathematical accuracy of the models. • Interviewing key research and development personnel and commercial personnel to assess reasonableness of the assumptions used, such as expected market share, revenue growth, expected margins, probability of success of products under development. • Challenging the Company’s key assumptions, such as the discount rate and other business assumptions used by Company, such as sales growth, cost based on past performances where relevant. • Involving our internal valuation specialists to assist us in evaluating the key assumptions and cash flow forecasts. • Performing sensitivity analysis of key assumptions such as future revenue growth rates, costs and the discount rates used in the valuation models. • Evaluating the adequacy of disclosures made in the standalone financial statements.

Key audit matters	How the matter was addressed in our audit
Litigations, claims and contingencies	Our audit procedures included the following:
Refer note 2.2(m) of the summary of significant accounting policies	• Evaluating the design and testing the operating effectiveness of
and note 30(C) to the standalone financial statements.	controls relating to identification and evaluation of litigation and
The Company is involved in disputes, lawsuits, claims, governmental	claims and measurement of provisions, contingent liabilities and
and/or regulatory inquiries, investigations and proceedings, including	disclosures thereof.
patent infringement cases, tax and commercial disputes arising from	• Obtained a list of ongoing litigations from the Company''s legal
time to time in the ordinary course of business.	head. We selected a sample of significant litigations and evaluated
Most of the claims involve complex legal and regulatory issues. The	the Company''s assessment thereof by:
Company, assisted by their external legal counsel assesses the need	i. making inquiries with the in-house legal counsel of the
to make provision or disclose a contingency on a case-to-case basis	Company;
considering the underlying facts of each litigation. The Company''s	ii. obtaining and inspecting board minutes, verifying
conclusions may result in an incorrect disclosure or provision in the	correspondence, orders and appeals in respect of open
books of account considering the aforesaid assessment involves significant judgement to be exercised by the Company based on	litigation; and
current developments. Further, unexpected adverse outcomes could	iii. obtained independent confirmations from external legal
also significantly impact the Company''s reported results.	counsels where relevant and/ or. evaluated legal opinions obtained by the Company. Also assessed the competence
This area is significant to our audit, since the accounting and disclosure for litigations, claims and contingencies is complex and	and independence of the external legal counsels.
judgemental.	iv evaluated uncertain tax positions with assistance of our tax
	specialists.
	• Evaluating the adequacy of provision and disclosures to Standalone financial statements
Revenue Recognition	Our audit procedures included the following:
Refer to Note 2.2(c) of the summary of significant accounting policies	• Assessing the Company''s revenue recognition policies for
to the standalone financial statements.	compliance with the applicable Ind AS.
Revenue from sale of goods is recognised when a promise in a	• Evaluating the design and implementation and testing the
customer contract (performance obligation) has been satisfied	operating effectiveness of the relevant key internal controls
by transferring control over the promised goods to the customer.	over recognition of revenue in accordance with delivery and
Control is usually transferred upon shipment, delivery to, upon	acceptance terms of the underlying customer contracts.
receipt of goods by the customer, in accordance with the delivery	• Performing testing of selected statistical samples of revenue
and acceptance terms agreed with the customers. The amount of	transactions recorded during the year by verifying the underlying
revenue to be recognised is based on the consideration expected	documents such as sales invoices/ contracts and dispatch/
to be received in exchange for goods, excluding trade discounts,	acknowledged delivery receipts/shipping documents.
volume discounts, sales returns and taxes.	• Testing revenue transactions recorded before and after the
We identified the recognition of revenue from sale of products as a	financial year end date, selected on a sample basis using random
key audit matter because:	sampling, to assess revenue is recognised in the period in which
Revenue is one of the key performance indicators for the Company	control is transferred.
and there could be a risk of revenue being recognised before the	• Assessing manual journals, sample selected based on specified
control has been transferred to the customer.	risk-based criteria posted to revenue to identify unusual items.

Key audit matters	How the matter was addressed in our audit
Inventory Valuation	Our audit procedures included the following:
Refer to Note 2.2(g) of the summary of significant accounting policies and note 11 to the standalone financial statements.	• Evaluating the Company’s inventory valuation policies and assessing compliance with the relevant accounting standards.
The carrying value of inventories comprising of raw materials, packing materials, work-in-progress, finished goods, stores, spares and consumables as at March 31,2022 is ''33,561.8 million.	• Evaluating the design and testing the implementation operating effectiveness of the Company’s internal controls valuation of inventories.	and over
Inventories are valued at lower of cost, determined on weighted average basis and net realisable value. Raw material costs include cost of purchase and other costs incurred in bringing the inventories to their present location and condition. Finished goods and work-in-progress costs include direct material, labour and a proportion of manufacturing overheads based on the normal operating capacity.	• Evaluating the data inputs by testing samples, selected using statistical sampling, by verifying the underlying records such as purchase invoices, cost sheets, batch records, overhead allocation workings, and capacity utilisation certificates. • Testing the mathematical accuracy of the valuation models. • Performing analytical procedures on gross margin analysis (including price and volume changes) to identify unusual
We identified inventory valuation as a key audit matter because of:	variances.
• the significance of the amount of inventories to the Standalone Balance Sheet; and
• non-automated environment, likelihood of material misstatement in inventory valuation arising from incorrect alterations to the inventory valuation records, on account of high volume of transactions and stock keeping units.

OTHER INFORMATION

The Company’s Management and Board of Directors are responsible for the other information. The other information comprises the information included in the Company’s annual report, but does not include the standalone financial statements and our auditor’s report thereon. The Company’s annual report is expected to be made available to us after the date of this auditor’s report.

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 in the audit or otherwise appears to be materially misstated.

When we read the annual report, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance.

MANAGEMENT’S AND BOARD OF DIRECTORS’ RESPONSIBILITIES FOR THE STANDALONE FINANCIAL STATEMENTS

The Company’s Management and Board of Directors are responsible for the matters stated in Section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the state of affairs, profit/loss and other comprehensive income, changes in equity and cash flows of the Company in accordance with the

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 judgements 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 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, the Management and Board of Directors 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 the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Board of Directors is also 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 standalone 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 judgement and maintain professional scepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the standalone 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 control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under Section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to financial statements 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 the Management and Board of Directors.

• Conclude on the appropriateness of the Management and Board of Directors use of the going concern basis of accounting in preparation of standalone financial statements 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.

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 of the standalone financial statements of the current period 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 Section 143 (11) of the Act, we give in the “Annexure A” a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

2. (A) 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 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 standalone balance sheet, the standalone statement of profit and loss (including other comprehensive income), the standalone statement of changes in equity and the standalone statement of cash flows 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 Ind AS specified under Section 133 of the Act.

e) On the basis of the written representations received from the directors as on March 31,2022 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2022 from being appointed as a director in terms of Section 164(2) of the Act.

• directly or indirectly, lend or invest in other persons or entities identified

in any manner whatsoever (“Ultimate Beneficiaries”) by or on behalf of the Funding Party or

• provide any guarantee, security or the like from or on behalf of the Ultimate Beneficiaries.

(iii) Based on such audit procedures as 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 (d) (i) and (d) (ii) contain any material misstatement.

e) The interim dividend declared and paid by the Company during the year and until the date of this audit report is in accordance with Section 123 of the Companies Act, 2013.

As stated in note 14 to the standalone financial statements, the Board of Directors of the Company has proposed final dividend for the year which is subject to the approval of the members at the ensuing Annual General Meeting. The dividend declared is in accordance with Section 123 of the Act to the extent it applies to declaration of dividend.

(C) With respect to the matter to be included in the Auditor’s Report under Section 197(16) of the Act:

I n our opinion and according to the information and explanations given to us, the remuneration paid by the Company to its directors during the current year is in accordance with the provisions of Section 197 of the Act. The remuneration paid to any director is not in excess of the limit laid down under Section 197 of the Act. The Ministry of Corporate Affairs has not prescribed other details under Section 197(16) of the Act which are required to be commented upon by us.

For B S R & Associates LLP

Chartered Accountants ICAI Firm Registration No. 116231 W/W-100024

Amit Kumar Bajaj

Partner

Place: Hyderabad Membership No. 218685

Date: May 30, 2022 ICAI UDIN: 22218685AJWCDF6328

f) With respect to the adequacy of the internal financial controls with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure B”.

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

a) The Company has disclosed the impact of pending litigations as at March 31, 2022 on its financial position in its standalone financial statements - Refer Note 30 to the standalone financial statements.

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

c) There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

d) (i) The Management has represented that,

to the best of its knowledge and belief, as disclosed in the note 52(v) to the accounts, no funds 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 persons or entities, including foreign entities (“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall:

• directly or indirectly lend or invest in other persons or entities identified

in any manner whatsoever (“Ultimate Beneficiaries”) by or on behalf of the Company or

• provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

(ii) The management has represented, that, to the best of its knowledge and belief, as disclosed in the note 52(v) to the accounts, no funds have been received by the Company from any persons or entities, including foreign entities (“Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the Company shall:

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Mar 31, 2021

REPORT ON THE AUDIT OF THE STANDALONE FINANCIAL STATEMENTS

Opinion

We have audited the standalone financial statements of Aurobindo Pharma Limited (“the Company”), which comprise the standalone balance sheet as at March 31, 2021, the standalone statement of profit and loss (including other comprehensive income), standalone statement of changes in equity and standalone statement of cash flows for the year then ended, and notes to the standalone financial statements, including a summary of the significant accounting policies and other explanatory information.

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 (“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 March 31, 2021, and profit and other comprehensive income, changes in equity and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under Section 143(10) of the Act. Our responsibilities under those SAs 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 together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on the standalone 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 standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone 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 the matters described below to be the key audit matters to be communicated in our report.

Description of Key Audit Matters
Key audit matters	How the matter was addressed in our audit
Valuation of Investments in subsidiaries and joint	Our audit procedures included the following:
venture	• Testing design, implementation and operating effectiveness
[Refer note 2.1(d)(vi) of the summary of significant accounting	of key controls over the impairment assessment process and
Policies and note 4 to the standalone financial statements]	forecasts and valuation models used by the Company.
The carrying value of investments in the Company’s	• Assessing the valuation methodology used by the Company and
subsidiaries and joint venture entities as at March 31, 2021 is	testing the mathematical accuracy of the models.
?48,657.31 million.	• Challenging the Company’s key assumptions such as the discount
The Company performs the annual assessment of investments to identify any indicators of impairment. Based on internal and external factors considered, where such evidence exists, impairment loss is determined and recognised in accordance with note 2.1(d)(vi) of accounting policies to the standalone financial statements.	rate and other business assumptions used by Company, such as sales growth, cost based on past performances where relevant. • Performing sensitivity analysis of key assumptions, future revenue growth rates, costs and the discount rates used in the valuation models.
We identified the assessment of impairment indicators and resultant impairment losses in respect of investment in subsidiaries/joint venture as a key audit matter because of:	• Evaluating the adequacy disclosure made in the standalone financial statements.
• The significance of the amount of these investments in the Standalone Balance Sheet; and
• The degree of management judgement involved in determining whether there was objective evidence of impairment of investments.

Description of Key Audit Matters
Key audit matters	How the matter was addressed in our audit
Litigations, claims and contingencies	In view of the significance of the matter we applied the following
Refer note 2.2(m) of the summary of significant accounting policies and note 30(C) to the standalone financial statements.	audit procedures in this area, among others to obtain sufficient audit evidence:
The Company is involved in disputes, lawsuits, claims, governmental and / or regulatory inquiries, investigations and proceedings, including patent infringement cases, tax and commercial disputes arising from time to time in the ordinary	• Evaluating the design and testing the operating effectiveness of controls relating to identification and evaluation of litigation and claims and measurement of provisions, contingent liabilities and disclosures thereof.
course of business.	• Obtained a list of ongoing litigations from the Company’s
Most of the claims involve complex issues. The Company, assisted by their external legal counsel assesses the need to	legal head. We selected a sample of significant litigations and evaluated the Company’s assessment thereof by:
make provision or disclose a contingency on a case-to-case	i. making enquiries with the in-house legal counsel of the
basis considering the underlying facts of each litigation. The	Company;
Company’s conclusions may result in an incorrect disclosure or provision in the books of account considering the aforesaid assessment involves significant judgment to be exercised	ii. verifying correspondence, orders and appeals in respect of open litigation; and
by the Company based on current developments. Further,	iii. obtained independent confirmations from external legal
unexpected adverse outcomes could also significantly	counsels where relevant and/ or evaluated legal opinions
impact the Company’s reported results.	obtained by the Company.
This area is significant to our audit, since the accounting and	• Evaluating the adequacy of provision and disclosures given in
disclosure for litigations, claims and contingencies is complex and judgmental.	Note 30(C) to standalone financial statements

Revenue Recognition	Our audit procedures in respect of the recognition of revenue
Refer to Note 2.2(C) of the summary of significant accounting policies to the standalone financial statements.	included the following: • Considering the Company’s revenue recognition policies and assessed compliance with the applicable accounting standards.
Revenue from sale of goods is recognised when a promise in a customer contract (performance obligation) has been satisfied by transferring control over the promised goods to the customer. Control is usually transferred upon shipment, delivery to, upon receipt of goods by the customer, in	• Evaluating the design, tested the implementation and operating effectiveness of the Company’s internal controls over recognition and measurement of revenue in accordance with underlying customer contracts.
accordance with the delivery and acceptance terms agreed	• Performing substantive testing (including cutoff testing
with the customers. The amount of revenue to be recognised	procedures) by selecting samples of revenue transactions
is based on the consideration expected to be received in	recorded during the year and for the selected samples, verifying
exchange for goods, excluding trade discounts, volume	the underlying documents such as sales invoices / contracts and
discounts, sales returns and taxes.	dispatch/shipping documents.
Revenue is one of the key performance indicators of the	• Assessing manual journals posted to revenue to identify unusual
Company and there could be a risk of revenue is recognised	items not already covered by our audit testing;
in the incorrect period or before the control has been transferred to the customer.	• Evaluating adequacy of disclosures given in the standalone

Other Information

The Company’s management and Board of Directors are responsible for the other information. The other information comprises the information included in the Company’s annual report, but does not include the financial statements and our auditors’ report thereon. The Company’s annual report is expected to be made available to us after the date of this auditor’s report.

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 in the audit or otherwise appears to be materially misstated.

When we read the annual report, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance.

Management’s and Board of Directors’ Responsibility for the Standalone Financial Statements

The Company’s Management and Board of Directors are responsible for the matters stated in Section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the state of affairs, profit/loss and other comprehensive income, changes in equity and cash flows of the Company in accordance with the 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 design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring 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, the Management and Board of Directors 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 the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Board of Directors is also 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 standalone 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 scepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the standalone 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 control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under Section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to financial statements 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 in the standalone financial statements made by the Management and Board of Directors.

• Conclude on the appropriateness of the Management and Board of Directors 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.

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 of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors’ 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.

Other Matters

The standalone financial statements of the company include the financial statements of 5 wholly owned subsidiaries whose standalone financial statements reflect total assets (before intercompany adjustments) of ?6,985.5 million as at March 31, 2021 (March 31, 2020: ?5,478.9 million) and the total revenue (before inter-company adjustments) of ?1,462.7 million (March 31, 2020: C1,109.1 million) for the year ended on that date. These subsidiaries have been merged with the Company vide The Hon’ble National Company Law Tribunal, Hyderabad order dated March 30, 2021. These subsidiaries have been audited by other auditors whose reports have been furnished to us, and our opinion in so far as it relates to the amounts and disclosures included in respect of these subsidiaries, is based solely on the report of such other auditors.

Our opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditors’ Report) Order, 2016 (“the Order”) issued by the Central Government in terms of Section 143 (11) of the Act, we give in the “Annexure A” a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

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 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 standalone balance sheet, the standalone statement of profit and loss (including other comprehensive income), the standalone statement of changes in equity and the standalone statement of cash flows dealt with by this Report are in agreement with the books of account;

d) I n our opinion, the aforesaid standalone financial statements comply with the Ind AS specified under Section 133 of the Act;

e) On the basis of the written representations received from the directors on various dates from March 31, 2021 till May 24, 2021 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2021 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 with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure B”; and

g) With respect to the other matters to be included in the Auditors’ 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 has disclosed the impact of pending litigations as at March 31, 2021 on its financial position in its standalone financial statements -Refer 30(C) to the standalone 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 has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company; and

iv. The disclosures in the standalone financial statements regarding holdings as well as dealings in specified bank notes during the period from November 8, 2016 to December 30, 2016 have not been made in these financial statements since they do not pertain to the financial year ended March 31, 2021.

3. With respect to the matter to be included in the Auditors’ Report under Section 197(16):

I n our opinion and according to the information and explanations given to us, the remuneration paid by the Company to its directors during the current year is in accordance with the provisions of Section 197 of the Act. The remuneration paid to any director is not in excess of the limit laid down under Section 197 of the Act. The Ministry of Corporate Affairs has not prescribed other details under Section 197(16) which are required to be commented upon by us.

For B S R & Associates LLP

Chartered Accountants ICAI Firm Registration No: 116231 W/W-100024

Sriram Mahalingam

Partner

Place: Palakkad Membership No: 049642

Date: June 3, 2021 ICAI UDIN: 21049642AAAABV5245

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Mar 31, 2019

INDEPENDENT AUDITOR’S REPORT

To the Members of Aurobindo Pharma Limited

REPORT ON THE AUDIT OF THE STANDALONE

FINANCIAL STATEMENTS

Opinion

We have audited the standalone financial statements of Aurobindo Pharma Limited (“the Company”), which comprise the standalone balance sheet as at 31 March 2019, the standalone statement of profit and loss (including other comprehensive income), standalone statement of changes in equity and standalone statement of cash flows for the year then ended, and notes to the standalone financial statements, including a summary of the significant accounting policies and other explanatory information.

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 (“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 31 March 2019, and profit and other comprehensive income, changes in equity and its cash flows for the year ended on that date.

Key audit matters How the matter was addressed in our audit Impairment of investment in subsidiaries Refer note 2.1(d)(vi) of the summary of significant accounting Our key audit procedures included the following: Policies and note 4 to the standalone financial statements. - Discussing with management whether there was any The Company has made investments in its subsidiaries and joint objective evidence of impairment of individual investment venture entities. The carrying value of these investments as at 31 and challenging management’s assertions and conclusions March 2019 is Rs,23,390.2 million. with reference to the guidance in the prevailing accounting Determining whether there is objective evidence of standards and by (i) obtaining the latest available budgets impairment, which includes a significant shortfall in the investee’s and comparing the actual performance of the investees actual business performance compared with budgets and with management expectations, (ii) °btaining and reviewing significant changes in the technological, market, economic or legal the latest financial statements of the respective investee environment that have an adverse effect on the fair value of the companies and fln) comparing the carrying amount of investment for investments which do not have a quoted prices in the investments with audited net worth of these investee an active market, involves the exercise of significant management companies which have been audited by the respective judgment. component auditor. - Assessing the appropriateness of the valuation methodology We identified assessing potential impairment of investments in used by management and tested the mathematical accuracy subsidiaries and joint ventures as a key audit matter because of of the impairment models. the significance of investments to the financial statements and Assessing the reasonableness of the valuation assumptions, because of the degree of judgment exercised by management in . ... . . such as discount rates, growth rate, projected/ forecasted determining whether there was objective evidence of impairment ofcash flow used by management. investments. - Performing a sensitivity analysis around the key assumptions, in particular discount rates and long term growth rates. - Assessed the appropriateness of the disclosure made in the standalone financial statements.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under Section 143(10) of the Act. Our responsibilities under those SAs 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 together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules there under, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the standalone 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 the matters described below to be the key audit matters to be communicated in our report.

Other Information

Key audit matters	How the matter was addressed in our audit
Contingencies and litigations
Refer note 2.2(m) of the summary of significant accounting policies	Evaluating the design and testing the operating effectiveness
and note 30(C) to the standalone financial statements.	of controls in respect of the recognition and measurement of
The Company operates in multiple jurisdictions in the	provisions towards litigation and claims;
pharmaceutical industry which is heavily regulated, resulting in	Corroborating management’s assessment by:
increased exposure to litigation risk. The Company is involved in a		making enquiries with the in-house legal counsel of the Company;
number of litigations/ legal actions.	-
These provisions are based on judgments and accounting
estimates made by management reflect in determining the	-	verifying correspondence, orders and appeals in respect of
likelihood and magnitude of an unfavorable outcome on the claims.		open litigation;
Accordingly, unexpected adverse outcomes could significantly	-	Obtaining confirmations from internal legal counsel where
impact the Company’s reported profit and balance sheet position.		relevant and/ or evaluating legal opinions obtained by the
		management;
		Evaluating significant adjustments to legal provisions recorded during the year to determine if they were indicative of management bias; and
	-	Evaluating adequacy of disclosures given in Note 30(C) to standalone financial statements
Revenue Recognition	In view of the significance of the matter, we applied the following
Refer to Note 2.2(c) of the summary of significant accounting	audit procedures in this area, among others to obtain sufficient
policies to the standalone financial statements.	appropriate audit evidence:
Revenue from sale of goods is recognized when a promise in a	-	Assessed the appropriateness of the Company’s revenue
customer contract (performance obligation) has been satisfied		recognition accounting policies including those relating to
by transferring control over the promised goods to the customer.		discounts and sales return and assessed compliance with
Control is usually transferred upon shipment, delivery to, upon		the policies in terms of applicable accounting standards.
receipt of goods by the customer, in accordance with the delivery	-	Tested the effectiveness of the Company’s controls over
and acceptance terms agreed with the customers. The amount of		measurement and recognition of revenue in accordance with
revenue to be recognized is based on the consideration expected		customer contracts which includes control over transaction
to be received in exchange for goods, excluding trade discounts,		pricing including discounts and correct timing of revenue
volume discounts, sales returns and any taxes or duties collected		recognition.
on behalf of the government which are levied on sales such as	-	Assessed sales transactions taking place at either side of
sales tax, value added tax, goods and services tax etc., where		the balance sheet date as well as credit notes issued after
applicable.		the yearend date to assess whether that revenue was
Revenue is one of the key performance indicators of the Company		recognized in the correct period.
and there could be a risk that revenue is recognized in the incorrect	-	Other audit procedures specifically designed to address risk
period or before the control has been transferred to the customer.		of Management override of controls included journal entry
		testing.

The Company’s management and Board of Directors are responsible for the other information. The other information comprises the information included in the Company’s annual report, but does not include the financial statements and our auditors’ report thereon. The Company’s annual report is expected to be made available to us after the date of this auditor’s report

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 financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.

When we read the annual report, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance.

Management’s Responsibility for the Standalone Financial Statements

The Company’s management and Board of Directors are responsible for the matters stated in Section 134(5) of the Act with respect to the preparation of these standalone financial statements that give a true and fair view of the state of affairs, profit/loss and other comprehensive income, changes in equity and cash flows of the Company in accordance with the 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 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 and Board of Directors 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.

Board of Directors is also 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 standalone 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 standalone 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 control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under Section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to financial statements 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.

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 of the standalone financial statements of the current period and are therefore the key audit matters.

We describe these matters in our auditors’ 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 (Auditors’ Report) Order, 2016 (“the Order”) issued by the Central Government in terms of Section 143 (11) of the Act, we give in the “Annexure A” a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

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 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 standalone balance sheet, the standalone statement of profit and loss (including other comprehensive income), the standalone statement of changes in equity and the standalone statement of cash flows 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 Ind AS specified under Section 133 of the Act;

e) On the basis of the written representations received from the directors as on 31 March 2019 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2019 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 with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure B”; and

g) With respect to the other matters to be included in the Auditors’ 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 has disclosed the impact of pending litigations as at 31 March 2019 on its financial position in its standalone financial statements - Refer Note 30(C) to the standalone 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 has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company; and

iv. The disclosures in the standalone financial statements regarding holdings as well as dealings in specified bank notes during the period from 8 November 2016 to 30 December 2016 have not been made in these standalone financial statements since they do not pertain to the financial year ended 31 March 2019.

3. With respect to the matter to be included in the Auditors’ Report under Section 197(16):

In our opinion and according to the information and explanations given to us, the remuneration paid by the Company to its directors during the current year is in accordance with the provisions of Section 197 of the Act. The remuneration paid to any director is not in excess of the limit laid down under Section 197 of the Act. The Ministry of Corporate Affairs has not prescribed other details under Section 197(16) which are required to be commented upon by us.

With reference to the “Annexure A” referred to in Report on Other Legal and Regulatory Requirements of the Independent Auditor’s Report to the Members of the Company on the audit of standalone financial statements for the year ended 31 March 2019, we report that:

i. (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of property, plant and equipment.

(b) The property, plant and equipment are physically verified by the Management according to a phased programme designed to cover all the items over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the Programme, a portion of the property, plant and equipment has been physically verified by the Management during the year and no material discrepancies have been noticed on such verification.

(c) In our opinion and according to the information and explanations given to us and on the basis of our examination of the

records of the Company, the title deeds of immovable properties, included in the property, plant and equipment except for the following are held in the name of the Company. As explained to us, registration of title deeds is in progress in respect of these immovable properties:

	No. of	Freehold /	Gross Block	Net Block as at
Category	instances	Leasehold	as at	31 March 2019
			31 March 2019 (Rs, in million)	(Rs, in million)
Land	5	Freehold land	131.2	131.2
Building	1	Freehold building	35.3	14.0
Total			166.5	145.2

ii. The inventories, except goods-in-transit and stock lying with third parties, has been physically verified by the Management during the year. In our opinion, the frequency of such verification is reasonable. The discrepancies noticed on verification between the physical stock and the book records were not material. Inventories lying with third parties as at 31 March 2019 have been confirmed by them and no material discrepancies were noticed in respect of such confirmations.

iii. According to information and explanations given to us, the Company has not granted any loans, secured or unsecured to companies, firms, Limited Liability Partnerships or other parties covered in the Register maintained under Section 189 of the Companies Act, 2013 (“the Act”). Accordingly, the Provisions of clause 3(iii)(a), (b) and (c) of the Order are not applicable to the Company and hence not commented upon.

iv. In our opinion and according to the information and explanations given to us, the Company has not advanced loans to directors / to a Company in which the director is interested to which, the provisions of Section 185 of the Act apply and hence not commented upon. However, in respect of loans given, investments made and guarantees given, the Company is in compliance with the provisions of Section 186 of the Act.

v. The Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the Rules framed there under. Accordingly, the provisions of clause 3(v) of the Order are not applicable.

vi. We have broadly reviewed the books of account 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 Act related to the manufacture of Active Pharmaceutical Ingredients and Formulations and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.

vii. (a) According to the information and explanations given to

us and on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Employees’ State Insurance, Income-tax, Duty of Customs, Goods and Services tax, Cess and other material statutory dues have generally been regularly deposited during the year by the Company with the appropriate authorities.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Employees’ State Insurance, Income-tax, Duty of Customs, Goods and Services tax, Cess and any other material statutory dues were in arrears as at 31 March 2019, for a period of more than six months from the date they became payable.

-Customs, Excise and Service Tax Appellate Tribunals

(b) According to the information and explanations given to us and based on our examination of the records of the Company, there are no dues of Goods and Services tax and Cess. According to the information and explanations given to us, the following dues of Income-tax, Service tax, Duty of Customs, Duty of Excise have not been deposited by the Company on account of disputes:

Nature of the Statute	Nature of dues	Disputed amount (Rs, in millions)	Paid under protest (Rs, in millions)	Period to which the amount relates	Forum where dispute is pending
Central Excise Act,	Central Excise	6.3	6.1	F.Y 2004-2016	CESTAT-
1944 and Customs	Central Excise	2.6	2.3	F.Y 2007-2014	Revisionary Authority
Act, 1962	Central Excise	7.4	-	F.Y 2013-2015	Commissioner (Appeals)
	Central Excise-Interest	0.5	0.2	F.Y 2006-2010	CESTAT-
	Central Excise-Interest	13.5	1.0	F.Y 2011-2012	Appellate Authority up to Commissioner’s level
	Customs	9.8	1.4	F.Y 2002-2015	CESTAT-
	Customs	4.7	3.7	F.Y 2011-2012	Commissioner (Appeals)
Finance Act, 1994	Service tax	1.8	0.2	F.Y 2014-2015	Commissioner (Appeals)
	Service tax	508.9	34.5	F.Y 2005-2016	CESTAT-
	Service tax	0.3	-	F.Y 2004-2005	Honorable AP High court
Income-tax Act, 1961	Income-tax	3.5	-	A.Y 2013-2015	Commissioner (Appeals)

viii. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of loans or borrowings to bank. The Company did not have any dues to any financial institution, government or debenture holder during the year.

ix. The Company has not raised any moneys by way of initial public offer or further public offer (including debt instruments). According to the information and explanation given to us, the monies raised by way of term loans have been applied, on an overall basis, for the purpose for which they are obtained.

x. Based on the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the Management, we report that no fraud by the Company or no fraud on the Company by its officers and employees of the Company has been noticed or reported during the year.

xi. According to the information and explanations given to us and based on examination of the records of the Company, the Company has paid/ provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.

xii. According to the information and explanations given to us, in our opinion, the Company is not a Nidhi Company as prescribed under Section 406 of the Act. Accordingly, provisions of clause 3(xii) of the Order are not applicable.

xiii. According to the information and explanations given to us and based on our examination of the records of the Company, transactions with related parties are in compliance with Sections 177 and 188 of the Act, where applicable, and the details of such transactions have been disclosed in the standalone financial statements as required by the applicable Indian Accounting Standards.

xiv. Based on our examination of the records of the Company and according to the information and explanations given to us, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year. Accordingly, provisions of clause 3(xiv) of the Order are not applicable.

xv. Based on our examination of the records of the Company and according to the information and explanations given to us, the Company has not entered into any non-cash transactions with its directors or persons connected with him, as referred to in Section 192 of the Act.

xvi. According to the information and explanations given to us and in our opinion, the Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934.

(Referred to in clause (f) of paragraph 2 under ‘Report on Other Legal and Regulatory Requirements’ section of our report of even date) Opinion

Report on the internal financial controls with reference to the aforesaid standalone financial statements under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013

We have audited the internal financial controls with reference to financial statements of Aurobindo Pharma Limited (“the Company”) as of 31 March 2019 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

In our opinion, the Company has, in all material respects, adequate internal financial controls with reference to financial statements and such internal financial controls were operating effectively as at 31 March 2019, based on the internal financial controls with reference to financial statements criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (the “Guidance Note”).

Management’s Responsibility for Internal Financial Controls

The Company’s management and the Board of Directors are responsible for establishing and maintaining internal financial controls based on the internal financial controls with reference to financial statements criteria established by the Company considering the essential components of internal control stated in the Guidance Note. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013 (hereinafter referred to as “the Act”).

Auditors’ Responsibility

Our responsibility is to express an opinion on the Company''s internal financial controls with reference to financial statements based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing, prescribed under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls with reference to financial statements. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls with reference to financial statements were established and maintained and whether such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls with reference to financial statements and their operating effectiveness. Our audit of internal financial controls with reference to financial statements included obtaining an understanding of such internal financial controls, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the standalone financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company’s internal financial controls with reference to financial statements.

Meaning of Internal Financial controls with Reference to Financial Statements

A Company''s internal financial controls with reference to financial statements is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A Company''s internal financial controls with reference to financial statements include those policies and procedures that:

1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;

2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and

3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company''s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial controls with Reference to Financial Statements

Because of the inherent limitations of internal financial controls with reference to financial statements, including the possibility

of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls with reference to financial statements to future periods are subject to the risk that the internal financial controls with reference to financial statements may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

For B S R & Associates LLP

Chartered Accountants

Firm’s Registration Number: 116231W/W-100024

Sriram Mahalingam

Partner

Membership Number: 049642

Place: Hyderabad

Date: 28 May 2019

---

Mar 31, 2018

REPORT ON THE AUDIT OF THE STANDALONE IND AS FINANCIAL STATEMENTS

We have audited the accompanying standalone Ind AS financial statements of Aurobindo Pharma Limited (“the Company”), which comprise the Balance Sheet as at 31 March 2018, the Statement of Profit and Loss, the Statement of Changes in Equity and the Statement of Cash Flows for the year then ended, and a summary of significant accounting policies and other explanatory information (herein after referred to as “standalone Ind AS financial statements”).

MANAGEMENT’S RESPONSIBILITY FOR THE STANDALONE IND AS 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 Ind AS financial statements that give a true and fair view of the state of affairs, profit (including other comprehensive income), changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) prescribed 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 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 standalone Ind AS 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, 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.

AUDITOR’S RESPONSIBILITY

Our responsibility is to express an opinion on these standalone Ind AS 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 thereunder.

We conducted our audit of the standalone Ind AS financial statements 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 standalone Ind AS financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the standalone Ind AS 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 standalone Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. 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 standalone Ind AS financial statements.

We are also responsible to 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 entity’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in the auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify the opinion. Our conclusions are based on the audit evidence obtained up to the date of the auditor’s report. However, future events or conditions may cause an entity to cease to continue as a going concern.

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

OPINION

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS 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 31 March 2018, its profit (including other comprehensive income), changes in equity and its cash flows for the year ended on that date.

OTHER MATTER

Corresponding figures for the year ended 31 March 2017 have been audited by another auditor who expressed an unmodified opinion dated 29 May 2017 on the standalone Ind AS financial statements of the Company for the year ended 31 March 2017.

Our opinion on the standalone Ind AS financial statements is not modified in respect of the above matter.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

1. As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”) issued by the Central Government of India in terms of Section 143(11) of the Act, we give in ‘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 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 including the Statement of Other Comprehensive Income, the Statement of Changes in Equity and the Statement of Cash Flows dealt with by this Report are in agreement with the books of account.

d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards prescribed under Section 133 of the Act.

e) On the basis of the written representations received from the directors as on 31 March 2018 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2018 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 with reference to financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure B”.

g) 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 has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements; - Refer Note 30(C) to the standalone Ind AS 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 has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company; and

iv. The disclosures in the standalone Ind AS financial statements regarding holdings as well as dealings in specified bank notes during the period from 8 November 2016 to 30 December 2016 have not been made since they do not pertain to the financial year ended 31 March 2018. However, amounts as appearing in the audited Standalone Ind AS financial statements for the period ended 31 March 2017 have been disclosed.

ANNEXURE A TO THE INDEPENDENT AUDITOR’S REPORT ON THE AUDIT OF STANDALONE IND AS FINANCIAL STATEMENTS

With reference to the “Annexure A” referred to in Report on Other Legal and Regulatory Requirements of the Independent Auditor’s Report to the Members of the Company on the audit of standalone Ind AS financial statements for the year ended 31 March 2018, we report that:

i. (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of property, plant and equipment.

(b) All property, plant and equipment 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 nature of its assets. No material discrepancies were noticed on such verification.

(c) In our opinion and according to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties, included in the property, plant and equipment except for the following are held in the name of the Company. As explained to us, registration of title deeds is in progress in respect of these immovable properties:

Category	No. of instances	Freehold / Leasehold	Gross Block as at 31 March 2018	Net Block as at 31 March 2018
Land	5	Freehold land	131,177,536	131,177,536
Building	1	Freehold building	35,341,469	15,199,937
Total			166,519,005	146,377,473

ii. The inventory, except goods-in-transit and stock lying with third parties, has been physically verified by the Management during the year. In our opinion, the frequency of such verification is reasonable. The discrepancies noticed on verification between the physical stock and the book records were not material. Inventories lying with third parties as at 31 March 2018 have been confirmed by them and no material discrepancies were noticed in respect of such confirmations.

iii. According to information and explanations given to us, the Company has not granted any loans, secured or unsecured to companies, firms, Limited Liability Partnerships or other parties covered in the Register maintained under Section 189 of the Companies Act, 2013 (“the Act”). Accordingly, the Provisions of clause 3(iii)(a), (b) and (c) of the Order are not applicable to the Company and hence not commented upon.

iv. In our opinion and according to the information and explanations given to us, the Company has not advanced loans to directors / to a Company in which the director is interested to which, the provisions of Section 185 of the Act apply and hence not commented upon. However, the Company has made investments and given guarantees / provided security which is in compliance with the provisions of Section 186 of the Act.

v. The Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, the provisions of clause 3(v) of the Order are not applicable.

vi. We have broadly reviewed the books of account 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 Act related to the manufacture of Active Pharmaceutical Ingredients and Formulations and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.

vii. (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Employees’ State Insurance, Income-tax, Sales-tax, Service tax, Duty of Customs, Duty of Excise, Value added tax, Goods and Services tax, Cess and other material statutory dues have generally been regularly deposited during the year by the Company with the appropriate authorities.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Employees’ State Insurance, Income-tax, Sales-tax, Service tax, Duty of Customs, Duty of Excise, Value added tax, Goods and Services tax, Cess and any other material statutory dues were in arrears as at 31 March 2018, 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 based on our examination of the records of the Company, there are no dues of Sales tax, Goods and Services tax, Value added tax and Cess. According to the information and explanations given to us, the following dues of Income-tax, Service Tax, Duty of Customs, Duty of Excise have not been deposited by the company on account of disputes:

Nature of the Statue	Nature of Dues	Disputed Amount (Rs.)	Paid under Protest (Rs.)	Period to which the amount relates	Forum where dispute is pending
Central Excise	Central Excise	33,988,653	13,591,862	F.Y 2004-2016	CESTAT*
Act ,1944	Central Excise	277,750	277,750	F.Y 1996-2000	Commissioner (Appeals)
and Customs	Central Excise	7,963,132	7,634,604	F.Y 2007-2014	Revisionary Authority
Act,1962	Central Excise	4,760,055	-	F.Y 2006-2008	Honorable AP High court
	Central Excise-Interest	463,652	181,308	F.Y 2006-2010	CESTAT*
	Central Excise-Interest	13,549,864	1,000,000	F.Y 2004-2010	Appellate Authority up to Commissioner’s level
	Customs	13,942,994	738,855	F.Y 2002-2015	CESTAT*
	Customs	4,689,566	3,739,566	F.Y 2011-2012	Commissioner (Appeals)
Finance Act,	Service tax	1,759,819	132,000	F.Y 2014-2015	Commissioner (Appeals)
1994	Service tax	508,575,636	25,483,138	F.Y 2005-2016	CESTAT*
	Service tax	260,105	-	F.Y 2004-2005	Honorable AP High court
Income-tax	Income-tax	221,655,739	-	A.Y 2009-2012	ITAT**
Act, 1961	Income-tax	3,543,130	-	A.Y 2013-2015	Commissioner (Appeals)

*Customs, Excise and Service Tax Appellate Tribunal

**Income Tax Appellate Tribunal

viii. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of loans or borrowings to bank. The Company did not have any dues to any financial institution, government or debenture holder during the year.

ix. The Company has not raised any moneys by way of initial public offer or further public offer (including debt instruments). According to the information and explanation given to us, the monies raised by way of term loans have been applied, on an overall basis, for the purpose for which they are obtained.

x. Based on the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the Management, we report that no fraud by the Company or no fraud on the Company by its officers and employees of the Company has been noticed or reported during the year.

xi. According to the information and explanations given to us and based on examination of the records of the Company, the Company has paid/ provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.

xii. According to the information and explanations given to us, in our opinion, the Company is not a nidhi company as prescribed under Section 406 of the Act. Accordingly, provisions of Clause 3(xii) of the Order are not applicable.

xiii. According to the information and explanations given to us and based on our examination of the records of the Company, transactions with related parties are in compliance with Sections 177 and 188 of the Act, where applicable, and the details of such transactions have been disclosed in the standalone Ind AS financial statements as required by the applicable accounting standards.

xiv. Based on our examination of the records of the Company and according to the information and explanations given to us, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year. Accordingly, provisions of Clause 3(xiv) of the Order are not applicable.

xv. Based on our examination of the records of the Company and according to the information and explanations given to us, the Company has not entered into any non-cash transactions with its directors or persons connected with him, as referred to in Section 192 of the Act.

xvi. According to the information and explanations given to us and in our opinion, the Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934.

For B S R & Associates LLP

Chartered Accountants

ICAI Firm Registration Number: 116231W/ W-100024

Amit Kumar Agarwal

Partner

Membership No.214198

Place: Hyderabad

Date: 28 May 2018

---

Mar 31, 2017

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of Aurobindo Pharma Limited (''the Company''), which comprise the Balance Sheet as at March 31, 2017, the Statement of Profit and Loss, including the statement of Other Comprehensive Income, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the 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 Ind AS financial statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity 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., read with the Companies (Indian Accounting Standards) Rules, 2015, as amended. 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 control that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Ind AS 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 Ind AS 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 of the standalone Ind AS financial statements in accordance with the Standards on Auditing, issued by the Institute of Chartered Accountants of India, as 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 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 standalone Ind AS 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 standalone Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of 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 standalone Ind AS 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 Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the standalone Ind AS 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 March 31, 2017, its profit including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s report) Order, 2016 (''the Order'') issued by the Central Government of India in terms of subsection (11) of Section 143 of the Act, we give in the Annexure 1 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 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, 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 Ind AS financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015, as amended;

e. On the basis of written representations received from the directors as on March 31, 2017, and taken on record by the Board of Directors, none of the Directors is disqualified as on March 31, 2017, 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 2'' to this report;

g. 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 has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements - Refer Note 31(C) to the standalone Ind AS 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 has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company;

iv. The Company has provided requisite disclosures in Note 12(D) to these standalone Ind AS financial statements as to the holding of Specified Bank Notes on November 8, 2016 and December 30, 2016 as well as dealings in Specified Bank Notes during the period from November 8, 2016 to December 30, 2016. Based on our audit procedures and relying on the management representation regarding the holding and nature of cash transactions, including Specified Bank Notes, we report that these disclosures are in accordance with the books of accounts maintained by the Company and as produced to us by the management.

Annexure 1 referred to in paragraph 1 of our report of even date

Re: Aurobindo Pharma Limited (''the Company'')

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

b. All fixed 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. No material discrepancies were noticed on such verification.

c. According to information and explanations given by the management, the title deeds of immovable properties, included in property, plant and equipment except for the following, are held in the name of the Company. As explained to us, registration of title deeds is in progress in respect of these immovable properties:

Category	No. of instances	Freehold/leasehold	Gross block as at March 31, 2017 (Rs.)	Net block as at March 31, 2017 (Rs.)
Land	5	Freehold land	131,777,536	131,777,536
Building	1	Freehold building	35,341,469	16,374,923
TOTAL			167,119,005	148,152,459

ii. The management has conducted physical verification of inventory at reasonable intervals during the year and no material discrepancies were noticed on such physical verification.

iii. According to the information and explanations given to us, the Company has not granted any loans, secured or unsecured to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Companies Act, 2013. Accordingly, the provisions of clause 3(iii)(a), (b) and (c) of the Order are not applicable to the Company and hence not commented upon.

iv. In our opinion and according to the information and explanations given to us, the Company has not advanced loans to directors/to a Company in which the director is interested to which, the provisions of Section 185 of the Companies Act, 2013 apply and hence not commented upon. In our opinion and according to the information and explanations given to us, the Company has made investments and given guarantees/provided security which is in compliance with the provisions of Section 186 of the Companies Act, 2013.

v. The Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, the provisions of clause 3(v) of the Order are not applicable.

vi. We have broadly reviewed the books of account 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, related to the manufacture of Active Pharmaceutical Ingredients and Formulations and are of the opinion that prima facie, the specified accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.

vii. a. The Company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, employees'' state insurance, income tax, sales tax, service tax, duty of custom, duty of excise, value added tax, cess and other material statutory dues applicable to it.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees'' state insurance, income tax, service tax, sales tax, duty of custom, duty of excise, value added tax, cess and other material statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

c. According to the records of the Company, the dues outstanding of income tax, sales tax, service tax, duty of custom, duty of excise, value added tax and cess on account of any dispute, are as follows:

Nature of the statute	Nature of the dues	Disputed Amount (Rs.)	Paid under protest (Rs.)	Period to which the amount relates	Forum where dispute is pending
Central Excise and Customs Act, 1944	Excise duty and penalty	9,224,104	5,559,640	2007-08, 2008-09, 2009-10, 2010-11	CESTAT
	Customs duty and penalty	8,709,455	346,340	2002-03, 2003-04, 2004-05, 2005-06	CESTAT
	Excise duty	14,606,598	14,471,641	2005-06	Commissioner of Central Excise
	Interest and penalty	14,013,0666	1,181,753	2006-07, 2007-08, 2008-09, 2009-10	CESTAT
	Excise duty and penalty	2,035,680	1,017,840	2009-10, 2010-11	CESTAT
	Excise duty and penalty	5,980,852		2006-07, 2007-08, 2008-09, 2009-10, 2010-11	CESTAT

Nature of the statute	Nature of the dues	Disputed Amount (Rs.)	Paid under protest (Rs.)	Period to which the amount relates	Forum where dispute is pending
	Customs duty and penalty	4,689,566	3,739,566	2011-12, 2012-13	Commissioner of Customs - Appeals
	Excise duty and penalty	6,278,701	1,809,138	2000-01, 2001-02, 2002-03	CESTAT
	Excise duty	3,962,773	3,962,773	2012-13	Revision Authority
	Interest	2,297,939	2,297,939	2007-08, 2008-09, 2009-10, 2010-11	Revision Authority
	Excise duty	4,760,055	-	2006-07, 2007-08	High Court
	Excise duty	4,490,484		2006-07, 2007-08, 2008-09, 2009-10, 2010-11, 2011-12	CESTAT
	Excise duty and penalty	636,956	318,478	2008-09	CESTAT
	Excise duty and penalty	1,226,000	1,176,000	2012-13	CESTAT
	Excise duty	100,943	-	2012-13, 2013-14, 2014-15	Commissioner of Central Excise (Appeals)
	Excise duty and penalty	83,242	83,242	2008-09, 2009-10	CESTAT
	Excise duty and penalty	1,989,820	1,889,820	2014-15, 2015-16	Commissioner of Central Excise (Appeals)
	Excise duty and penalty	84,215	-	2014-15	Commissioner of Central Excise (Appeals)
	Excise duty	5,665,193	5,336,665	2012-13, 2013-14	Revision Authority
	Service tax	3,369,212	428,697	2012-13	CESTAT
	Service tax	11,295,379	2,066,239	2011-12	CESTAT
	Service tax	12,308,490	9,376,541	2006-07, 2007-08, 2008-09, 2009-10, 2010-11	CESTAT
	Service tax	97,222,192	''	2005-06, 2007-08, 2008-09, 2009-10, 2010-11	CESTAT
	Service tax	69,299,037	5,197,428	2011-12	CESTAT
	Service tax	429,697	429,697	2012-13	CESTAT
	Service tax	32,871,546	2,465,366	2013-14	CESTAT
	Service tax	120,542,613	-	2014-15	CESTAT
	Service tax	49,083,119	-	2014-15, 2015-16	Commissioner (Appeals)
Income Tax Act,	Income tax	190,070,479	-	2008-09	ITAT
1961	Income tax	31,585,269	-	2010-11	ITAT
	Income tax	991,130	-	2013-14	Commissioner of Income Tax (Appeals)

viii. In our opinion and according to the information and explanations given by the management, the Company has not defaulted in repayment of loans or borrowings to a bank or government. There are no dues which are payable to financial institutions or debenture holders.

ix. In our opinion and according to the information and explanations given by the management, the Company has utilized the monies raised by way of term loans for the purposes for which they were raised. The Company has not raised any money way of initial public offer/further public offer/debt instruments and hence, not commented upon.

x. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, we report that no fraud by the Company or no fraud on the Company by the officers and employees of the Company has been noticed or reported during the year.

xi. According to the information and explanations given by the management, the managerial remuneration has been paid/ provided in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Companies Act, 2013.

xii. In our opinion, the Company is not a nidhi company. Therefore, the provisions of clause 3(xii) of the order are not applicable to the Company and hence not commented upon.

xiii. According to the information and explanations given by the management, transactions with the related parties are in compliance with Sections 177 and 188 of Companies Act, 2013 where applicable and the details have been disclosed in the notes to the financial statements, as required by the applicable accounting standards.

xiv. According to the information and explanations given to us and on an overall examination of the balance sheet, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review and hence, reporting requirements under clause 3(xiv) are not applicable to the Company and, not commented upon.

xv. According to the information and explanations given by the management, the Company has not entered into any non-cash transactions with directors or persons connected with him as referred to in Section 192 of Companies Act, 2013.

xvi. According to the information and explanations given to us, the provisions of Section 45-IA of the Reserve Bank of India Act, 1934 are not applicable to the Company.

For S.R. BATLIBOI & ASSOCIATES LLP

Chartered Accountants

ICAI Firm''s Registration Number: 101049W/E300004

per VIKAS KUMAR PANSARI

Partner

Membership No. 093649

Hyderabad, May 29, 2017

---

Mar 31, 2016

We have audited the accompanying standalone financial statements of Aurobindo Pharma Limited (''the Company''), which comprise the Balance Sheet as at March 31, 2016, 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

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 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 the design, implementation and maintenance of adequate internal financial control 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, issued by the Institute of Chartered Accountants of India, as 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 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. An audit also includes evaluating the appropriateness of 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 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 March 31, 2016, 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, 2016 (''the Order'') issued by the Central Government of India in terms of sub-section (11) of Section 143 of the Act, we give in ''Annexure 1'', 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 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 Rule 7 of the Companies (Accounts) Rules, 2014;

e. On the basis of the written representations received from the Directors as on March 31, 2016 and taken on record by the Board of Directors, none of the Directors is disqualified as on March 31, 2016 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 2'' to this report; and

g. 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 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 were any material foreseeable losses;

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

Re: Aurobindo Pharma Limited (''the Company'')

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

b. All fixed 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. No material discrepancies were noticed on such verification.

c. According to the information and explanations given by management, the title deeds of immovable properties, included in fixed assets except for the following, are held in the name of the Company. As explained to us, Registration of title deeds is in progress in respect of these immovable properties.

Category No. of instances Freehold/ leasehold Gross block Net block as at March 31, 2016 as at March 31, 2016

Land 5 Freehold land 126,535,881 126,535,881

Building 1 Freehold building 35,341,469 17,551,237

TOTAL 161,877,350 144,087,118

ii. The management has conducted physical verification of inventory at reasonable intervals during the year and no material discrepancies were noticed on such physical verification.

iii. According to the information and explanations given to us, the Company has not granted any loans, secured or unsecured to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under Section 189 of the Companies Act, 2013. Accordingly, the provisions of clause 3(iii)(a), (b) and (c) of the Order are not applicable to the Company and hence not commented upon.

iv. In our opinion and according to the information and explanations given to us, the Company has not advanced loans to Directors/to a company in which the Director is interested to which, the provisions of Section 185 of the Companies Act, 2013 apply and hence not commented upon. In our opinion and according to the information and explanations given to us, the Company has made investments and given guarantees/provided security which is in compliance with the provisions of Section 186 of the Companies Act, 2013.

v. The Company has not accepted any deposits from the public.

vi. We have broadly reviewed the books of account 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, related to the manufacture of Active Pharmaceutical Ingredients and Formulations and are of the opinion that prima facie, the specified accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.

vii. a. The Company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, employees'' state insurance, income tax, sales tax, service tax, customs duty, excise duty, value added tax, cess and other material statutory dues applicable to it.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees'' state insurance, income tax, service tax, sales tax, duty of custom, duty of excise, value added tax, cess and other material statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

c. According to the records of the Company, the dues outstanding of income tax, sales tax, service tax, duty of custom, duty of excise, value added tax and cess on account of any dispute, are as follows:

Nature of the statute Nature of Disputed Paid under the dues Amount Rs. protest Rs.

Central Excise and Excise duty and 9,224,104 5,559,640 Customs Act,1944 penalty

Customs duty and 8,709,455 346,340 penalty

Excise duty 14,606,598 14,471,641

Interest and 14,013,066 1,181,753 penalty

Excise duty 1,303,500 -

Excise duty and 2,035,680 1,017,840 penalty

Excise duty and 77,49,644 2,569,008 penalty

Excise duty and 5,480,404 3,490,202 penalty

Excise duty and 5,980,852 - penalty

Customs duty and 4,689,566 3,739,566 penalty

Excise duty and 6,278,701 1,809,138 penalty

Excise duty 3,962,773 3,962,773

Central Excise and Interest 2,297,939 2,297,939 Customs Act, 1944

Excise duty 4,760,055 -

Excise duty 4,490,484 -

Excise duty and 636,956 318,478 penalty

Excise duty and 1,226,000 1,176,000 penalty

Excise duty 156,000 156,000

Excise duty 264,226 -

Excise duty and 83,242 83,242 penalty

Excise duty and 38,218 19,109 penalty

Excise duty and 1,989,820 1,889,820 penalty

Excise duty and 84,215 - penalty

Excise duty 5,665,193 4,925,488

Finance Act, 1994 Service Tax 458,500 458,500

Service Tax 3,369,212 428,697

Service Tax 11,295,379 2,066,239

Service Tax 12,308,490 9,376,541

Service Tax 97,222,192 -

Service Tax 69,299,037 5,197,428

Service Tax 1,595,280 1,595,280

Income Tax Act, 1961 Income Tax 190,070,479 - Income Tax 31,585,269 -

Nature of the Statute Period to which the Forum where dispute amount relates is pending

Central Excise and Customs Act, 1944 2007-08, 2008-09, CESTAT 2009-10, 2010-11

2002-03, 2003-04, CESTAT 2004-05, 2005-06

2005-06 Commissioner of Central Excise

2006-07, 2007-08, CESTAT 2008-09, 2009-10

2007-08 CESTAT

2009-10, 2010-11 CESTAT

2005–06, 2006–07, CESTAT 2007–08, 2008–09, 2009–10, 2010–11

2008–09 CESTAT

2006–07, 2007–08, CESTAT 2008–09, 2009–10, 2010–11

2011–12, 2012–13 Commissioner of Customs – Appeals

2000–01, 2001–02, CESTAT 2002–03

2012–13 Revision Authority

Central Excise and Customs Act, 1944 2007–08, 2008–09, Revision Authority 2009–10, 2010–11

2006–07, 2007–08 High court

2006–07, 2007–08, CESTAT 2008–09, 2009–10, 2010–11, 2011–12

2008–09 CESTAT

2012–13 CESTAT

2013–14 Commissioner of Central Excise (Appeals)

2011–12, 2012–13, Commissioner of 2013–14, 2014–15 Central Excise (Appeals)

2008–09, 2009–10 CESTAT

2013–14, 2014–15 Commissioner of Central Excise (Appeals)

2014–15, 2015–16 Commissioner of Central Excise (Appeals)

2014–15 Commissioner of Central Excise (Appeals)

2012–13, 2013–14 Revision Authority

Finance Act, 1994 2007–08 CESTAT

2012–13 CESTAT

2011–12 CESTAT

2006–07, 2007–08, CESTAT 2008–09, 2009–10, 2010–11

2005–06, 2007–08, CESTAT 2008–09, 2009–10, 2010–11

2011–12 CESTAT

2008–09 CESTAT

Income Tax Act, 1961 2008–2009 ITAT

2010–2011 ITAT

viii. In our opinion and according to the information and explanations given by the management, the Company has not defaulted in repayment of dues to a bank or government loan in the nature of sales tax deferment. There are no dues which are payable to financial institutions or debenture holders.

ix. In our opinion and according to the information and explanations given by the management, the Company has utilized the monies raised by way of term loans for the purposes for which they were raised. The Company has not raised any money by way of initial public offer/further public offer/ debt instruments and hence, not commented upon.

x. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and according to the information and explanations given by the management, we report that no fraud by the Company or on the Company by the officers and employees of the Company has been noticed or reported during the year.

xi. According to the information and explanations given by the management, the managerial remuneration has been paid/ provided in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Companies Act, 2013.

xii. In our opinion, the Company is not a nidhi company. Therefore, the provisions of clause 3(xii) of the order are not applicable to the Company and hence not commented upon.

xiii. According to the information and explanations given by the management, transactions with the related parties are in compliance with Sections 177 and 188 of Companies Act, 2013 where applicable and the details have been disclosed in the notes to the financial statements, as required by the applicable accounting standards.

xiv. According to the information and explanations given to us and on an overall examination of the balance sheet, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review and hence, reporting requirements under clause 3(xiv) are not applicable to the Company and, not commented upon.

xv. According to the information and explanations given by the management, the Company has not entered into any non-cash transactions with Directors or persons connected with him as referred to in Section 192 of Companies Act, 2013.

xvi. According to the information and explanations given to us, the provisions of Section 45-IA of the Reserve Bank of India Act, 1934 are not applicable to the Company.

For S.R. BATLIBOI & ASSOCIATES LLP

Chartered Accountants

ICAI Firm''s Registration Number: 101049W/E300004

per VIKAS KUMAR PANSARI

Partner

Membership No. 093649

Hyderabad, May 30, 2016

---

Mar 31, 2015

We have audited the accompanying standalone financial statements of Aurobindo Pharma Limited (''the Company1), which comprise the Balance Sheet as at March 31, 2015, 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

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 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 the design, implementation and maintenance of adequate internal financial control 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, issued by the Institute of Chartered Accountants of India, as 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 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 effectiveness of such controls. An audit also includes evaluating the appropriateness of 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 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 March 31, 2015, 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 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 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 Rule 7 of the Companies (Accounts) Rules, 2014;

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

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 our 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 29 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 has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company.

Annexure referred to in paragraph 1 of our report of even date Re: Aurobindo Pharma Limited (''the Company'')

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

b. All fixed 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. No material discrepancies were noticed on such verification.

ii. a. The management has conducted physical verification of inventory at reasonable intervals during the year.

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. The Company is maintaining proper records of inventory and no material discrepancies were noted on physical verification.

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, the provisions of clause 3(iii)(a) and (b) of the Order are not applicable to the Company and hence not commented upon.

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, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness or continuing failure to correct any major weakness in the internal control system of the Company in respect of these areas.

v. The Company has not accepted any deposits from the public.

vi. We have broadly reviewed the books of account 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, related to the manufacture of Active Pharmaceutical Ingredients and Formulations and are of the opinion that prima facie, the specified accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.

vii a. Undisputed statutory dues including provident fund, employees'' state insurance, income tax, sales tax, wealth tax, service tax, customs duty, excise duty, value added tax, cess and other material statutory dues have generally been regularly deposited with the appropriate authorities.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees'' state insurance, income tax, sales tax, wealth tax, service tax, customs duty, excise duty, value added tax, cess and other material statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

c. According to the records of the Company, the dues outstanding of income tax, sales tax, wealth tax, service tax, customs duty, excise duty, value added tax and cess on account of any dispute, are as follows:

Name of the statute Nature of Disputed Paid under dues Amount Rs. protest Rs.

Central Excise and Excise duty and 9,224,104 4,000,000 Customs Act, 1944 penalty

Customs duty and 8,709,455 - penalty

Excise duty 14,606,598 14,471,641

Interest 13,013,066 1,181,753

Excise duty 1,303,500 -

Excise duty and 2,035,680 1,017,840 penalty

Excise duty and 13,029,452 2,569,008 penalty

Excise duty 13,062,768 -

Excise duty and 5,480,404 3,490,202 penalty



Name of the statute Period to which the Forum where dispute is amount relates is pending

Central Excise and Customs Act, 1944 2007- 08, 2008-09, CESTAT 2009-10, 2010-11

2002-03, 2003-04, Commissioner

2004- 05, 2005-06 of Customs

2005- 06 Commissioner of Central Excise

2006- 07, 2007-08, CESTAT 2008- 09, 2009-10

2007- 08 CESTAT

2009- 10, 2010-11 CESTAT

2005-06, 2006-07, CESTAT

2007- 08, 2008-09, 2009-10, 2010-11, 2011-12, 2012-13

2011-12, 2012-13 CESTAT

2008- 09 CESTAT



Name of the statute Nature of Disputed Paid under dues Amount Rs. protest Rs.



Excise duty and 5,980,852 - penalty

Customs duty 4,689,566 3,739,566 and penalty

Excise duty and 6,278,701 - penalty

Excise duty 3,962,773 3,962,773

Interest 2,297,939 2,297,939

Finance Act, Service Tax 64,685 - 1994 Service Tax 458,500 458,500

Service Tax 1,524,348 -

Service Tax 3,369,212 428,697

Service Tax 11,295,379 2,066,239

Service Tax 12,308,490 9,376,541

Service Tax 97,222,192 -

Service Tax 69,299,037 5,197,428

Income Tax Income Tax 283,446,583 - Act, 1961 Income Tax 405,333,009 -

Income Tax 330,121,258 -



Name of the statute Period to which the Forum where dispute is amount relates is pending

2006- 07, 2007-08, CESTAT 2008- 09, 2009-10, 2010-11

2011- 12, 2012-13 Commissioner of Customs-Appeals

2000-01, 2001-02, CESTAT 2002-03

2012- 13 Revision Authority

2007- 08, 2008-09, Revision Authority 2009- 10, 2010-11

Finance Act, 1994 2006- 07 CESTAT

2007- 08 CESTAT

2006-07 CESTAT

2012-13 CESTAT

2011-12 CESTAT

2006-07, 2007-08, CESTAT 2008- 09, 2009-10, 2010- 11

2005-06, 2007-08, CESTAT 2008-09, 2009-10, 2010-11

2011-12 CESTAT

Income Tax 2008- 09 ITAT Act, 1961 2009- 10 ITAT

2010- 11 ITAT

d. According to the information and explanations given to us, the amount required to be transferred to Investor Education and Protection Fund in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made there under has been transferred to such fund within time.

viii. 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.

ix. Based on our audit procedures and as per the information and explanations given by the management, we are of the opinion that 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 given guarantee for loans taken by wholly owned subsidiaries from banks and financial institutions, the terms and conditions whereof, in our opinion, are not prima-facie prejudicial to the interest of the Company.

xi. Based on the information and explanations given to us by the Management, term loans were applied for the purpose for which the loans were obtained.

xii. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the year.

For S.R. BATLIBOI & ASSOCIATES LLP

Chartered Accountants

ICAI Firm''s Registration Number: 101049W

per VIKAS KUMAR PANSARI

Partner

Membership No. 093649

Hyderabad, May 28, 2015

---

Mar 31, 2014

We have audited the accompanying financial statements of Aurobindo Pharma Limited ("the Company"), which comprise the Balance Sheet as at March 31, 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 and cash flows of the Company in accordance with accounting principles generally accepted in India, including the Accounting Standards notified under the Companies Act, 1956, read with General Circular 8/2014 dated April 4, 2014 issued by the Ministry of Corporate Affairs. 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 entity''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 Companies Act, 1956 ("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 March 31, 2014;

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

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") 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, and Cash Flow Statement dealt with by this Report are in agreement with the books of account;

d. In our opinion, the Balance Sheet, the Statement of Profit and Loss, and the Cash Flow Statement comply with the Accounting Standards notified under the Companies Act, 1956, read with General Circular 8/2014 dated April 4, 2014 issued by the Ministry of Corporate Affairs;

e. On the basis of written representations received from the Directors as on March 31, 2014, and taken on record by the Board of Directors, none of the Directors is disqualified as on March 31, 2014, from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

Annexure referred to in paragraph 1 of our report of even date Re: Aurobindo Pharma Limited

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

b. All fixed 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. No material discrepancies were noticed on such verification.

c. There was no disposal of a substantial part of fixed assets during the year.

ii. a. The management has conducted physical verification of inventory at reasonable intervals during the year.

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. 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 not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Act. Accordingly, the provisions of clause 4(iii)(a) to (d) of the Order are not applicable to the Company and hence not commented upon.

e. According to information and explanations given to us, 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 Act. Accordingly, the provisions of clause 4(iii)(e) to (g) of the Order are not applicable to the Company and hence not commented upon.

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, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness or continuing failure to correct any major weakness in the internal control system of the Company in respect of these areas.

v. a. According to the information and explanations provided by the management, we are of the opinion that the particulars of contracts or arrangements referred to in Section 301 of the Act that need to be entered into the register maintained under Section 301 have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees five lakhs have been entered into during the financial year 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 the public.

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

viii. We have broadly reviewed the books of account 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 Act and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.

ix. a. The Company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees'' state insurance, income tax, sales tax, wealth tax, service tax, customs duty, excise duty, cess and other material statutory dues applicable to it.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees'' state insurance, income tax, wealth tax, service tax, sales tax, customs duty, excise duty cess and other material statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

c. According to the records of the Company, the dues outstanding of income tax, sales tax, wealth tax, service tax, customs duty, excise duty and cess on account of any dispute, are as follows:

Name of the Statute Nature of dues Amount Period to which the demanded Rs. amount relates

Central Excise and Customs duty 42,621,459* 2002-03, 2003-04, Customs Act, 1944 and penalty 2004-05, 2005-06

Excise duty 18,604,080 2006-07, 2007-08, 2008-09

Excise duty 14,606,598# 2005-06

Excise duty 9,224,104 2007-08, 2008-09, and penalty 2009-10, 2010-11



Name of the Statue Forum where dispute is pending

Central Excise and Customs Act, 1944 CESTAT

CESTAT

Commissioner of Central Excise

Commissioner of Central Excise



Name of the Statute Nature of dues Amount Period to which the demanded Rs. amount relates

Interest 7,825,256 2006-07, 2007-08, 2008-09, 2009-10

Excise duty 4,039,233 2005-06, 2006-07, 2007-08, 2008-09, 2009-10, 2010-11, 2011-12

Excise duty 1,303,500 2007-08

Interest 4,438,665 2006-07, 2007-08,

2008-09, 2009-10, 2010-11

Excise Duty 228,913 2006-07, 2007-08,

2008-09, 2009-10

Finance Act, 1994 Service Tax 3,242,003 2004-05

Service Tax 97,222,192 2005-06, 2006-07,

2007-08, 2008-09, 2009-10, 2010-11

Service Tax 12,308,490 2006-07, 2007-08, 2008-09, 2009-10, 2010-11

Service Tax 64,685 2006-07

Service Tax 1,524,348 2006-07

Income Tax Act, 1961 Income Tax 328,837,414$ 2007-08



Name of the Statue Forum where dispute is pending

Commissioner of Central Excise

Additional Commissioner of Central Excise

Assistant Commissioner, Appeals

Joint Commissioner of Central Excise

Assistant Commissioner of Central Excise

Finance Act, 1994 Assistant Commissioner of Central Excise

CESTAT

CESTAT

CESTAT CESTAT

Income Tax Act, 1961 ITAT@

@ Stay granted

# Amount paid under protest Rs.14,187,883

$ Amount paid under protest Rs.120,000,000

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. Based on our audit procedures and as per the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

xii. According to the information and explanations given to us and based on the documents and records produced before us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

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 (Auditor''s Report) Order, 2003 (as amended) 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 (Auditor''s Report) Order, 2003 (as amended) 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 bank or financial institutions.

xvi. Based on the information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained.

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 no funds raised on short-term basis have been used for long-term investment.

xviii. The Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under Section 301 of the Companies Act, 1956.

xix. The Company did not have any outstanding debentures during the year.

xx. The Company has not raised any money by way of public issue during the year.

xxi. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the year.

For S.R. BATLIBOI & ASSOCIATES LLP

Chartered Accountants

ICAI Firm''s Registration Number: 101049W

per VIKAS KUMAR PANSARI

Partner

Membership No. 93649

Hyderabad, May 30, 2014

---

Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of Aurobindo Pharma Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2013, 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 and cash flows of the Company in accordance with accounting principles generally accepted in India, including the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956 ("the Act"). 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. 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 March 31, 2013;

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

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") 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, and Cash Flow Statement 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, and Cash Flow Statement comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Act; and

e. On the basis of written representations received from the Directors as on March 31, 2013 and taken on record by the Board of Directors, none of the Directors is disqualified as on March 31, 2013, from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Act.

Annexure referred to in paragraph 1 of our report of even date

Re: Aurobindo Pharma Limited

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

b. All fixed 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. No material discrepancies were noticed on such verification.

c. There was no disposal of a substantial part of fixed assets during the year.

ii. a. The management has conducted physical verification of inventory at reasonable intervals during the year.

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. 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 not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Act. Accordingly, the provisions of clause 4(iii) (a) to (d) of the Order are not applicable to the Company and hence not commented upon

b. According to information and explanations given to us, 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 Act. Accordingly, the provisions of clause 4(iii)(e) to (g) of the Order are not applicable to the Company and hence not commented upon.

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, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness or continuing failure to correct any major weakness in the internal control system of the company in respect of these areas.

v. a. According to the information and explanations provided by the management, we are of the opinion that the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 that need to be entered into the register maintained under Section 301 have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements and exceeding the value of Rupees five lakhs have been entered into during the financial year 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 the public.

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

viii. We have broadly reviewed the books of account 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 are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the same.

ix. a. The Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education and protection fund, employees'' state insurance, income tax, sales tax, wealth tax, service tax, customs duty, excise duty, cess and other material statutory dues applicable to it.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees'' state insurance, income tax, wealth tax, service tax, sales tax, customs duty, excise duty, cess and other material statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

c. According to the records of the Company, there are no dues outstanding of income tax, sales tax, wealth tax, service tax, customs duty, excise duty and cess on account of any dispute, other than service tax, custom duty, excise duty which are as follows:

Name of the statute Nature of dues Amount demanded Rs.

Central Excise and Customs duty 42,621,459 Customs Act, 1944 and penalty

Excise duty 18,604,080

Excise duty 14,606,598

Excise duty 9,224,104 and penalty

Name of the Statute Period to which the Forum where dispute is amount relates pending

Central Excise and Customs Act 1944 2002-03, 2003-04, CESTAT@ 2004-05, 2005-06

2006-07, 2007-08, CESTAT 2008-09

2005-06 Commissioner of Central Excise

2007-08, 2008-09, Commissioner of 2009-10, 2010-11 Central Excise

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. Based on our audit procedures and as per the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

xii. According to the information and explanations given to us and based on the documents and records produced before us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

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 (Auditor''s Report) Order, 2003 (as amended) 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 (Auditor''s Report) Order, 2003 (as amended) are not applicable to the Company.

xv. According to the information and explanations given to us, the Company has given guarantee for loans taken by others from banks, the terms and conditions whereof, in our opinion, are not prima-facie prejudicial to the interest of the Company. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from financial institutions.

xvi. Based on the information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained.

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 no funds raised on short-term basis have been used for long-term investment.

xviii. The Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under Section 301 of the Companies Act, 1956.

xix. The Company did not have any outstanding debentures during the year.

xx. The Company has not raised any money by way of public issue during the year.

xxi. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the year.

For S.R. BATLIBOI & ASSOCIATES LLP

Chartered Accountants

ICAI Firm''s Registration Number: 101049W

per VIKAS KUMAR PANSARI

Partner

Membership No. 93649

Hyderabad, May 30, 2013

---

Mar 31, 2012

1. We have audited the attached Balance Sheet of Aurobindo Pharma Limited ('the Company') as at March 31, 2012 and also the Statement of Profit and Loss and the 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 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 (as amended) 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. Without qualifying our opinion, we draw attention to Note 43 of financial statements, regarding excess managerial remuneration amounting to Rs25,086,424 paid to four Directors in excess of limits prescribed under Schedule XIII of the Companies Act, 1956. As represented to us by the management, the Company is in the process of applying to the Central Government for the approval of such excess remuneration. The ultimate outcome of the above matters cannot presently be determined, accordingly no adjustments has been made in the financial statements.

5. 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, Statement of Profit and Loss and Cash Flow Statement dealt with by this report are in agreement with the books of account;

iv. in our opinion, the Balance Sheet, Statement of Profit and Loss 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 the written representations received from the Directors, as on March 31, 2012, and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on March 31, 2012 from being appointed as a director in terms of clause (g) of sub- section (1) of Section 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, they said accounts 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 March 31, 2012;

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

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

Annexure referred to in paragraph 3 of our report of even date

Re: Aurobindo Pharma Limited

i. a. The Company has maintained proper records showing full

particulars, including quantitative details and situation of fixed assets.

b. All fixed assets have not been physically verified by the management during the year but there is a regular program of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. As informed, no material discrepancies were noticed on such verification.

c. There was no substantial disposal of fixed assets during the year.

ii. a. The management has conducted physical verification of inventory at reasonable intervals during the year.

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

iii. a. As informed, the Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, the provisions of clauses 4 (iii)(a) to (d) of the Companies (Auditor's Report) Order, 2003 (as amended) are not applicable to the Company.

e. As informed, 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, the provisions of clauses 4 (iii)(e) to (g) of the Companies (Auditors' Report) Order, 2003 (as amended) are not applicable to the Company.

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, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness or continuing failure to correct any major weakness in the internal control system of the Company in respect of these areas.

v. a. According to the information and explanations provided by the management, we are of the opinion that the particulars of contracts or arrangements referred to in Section 301 of the Act that need to be entered into the register maintained under Section 301 have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding value of Rupees five lakhs have been entered into during the financial year 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 the public.

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

viii. We have broadly reviewed the books of account 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 are of the opinion that prima facie, the prescribed accounts and records have been made and maintained.

ix. a. Undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, cess and other material statutory dues 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, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees' state insurance, income-tax, wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and other material statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

c. According to the records of the Company, there are no dues outstanding of income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty and cess on account of any dispute, other than service tax, customs duty and excise duty which are follows:

Name of the statute Nature of dues Amount Period to which the Forum where dispute is Rs. amount relates pending

Central Excise and Customs duty 42,621,459* 2002-03, 2003-04, CESTAT Customs Act, 1944 and penalty 2004-05, 2005-06

Excise duty 18,604,080 2006-07, 2007-08, CESTAT 2008-09 Excise duty 14,606,598** 2005-06 Commis sioner of Central Excise

Excise duty 9,224,104 2007-08, 2008-09, Commis sioner of and penalty 2009-10, 2010-11 Central Excise Interest 8,825,256 2006-07, 2007-08, Commis sioner of 2008-09, 2009-10 Central Excise

Excise duty 6,401,211 2005-06, 2006-07, Additional Commissioner 2007-08, 2008-09, of Central Excise 2009-10, 2010-11 Excise duty 1,303,500 2007-08 Assistant Commissioner Appeals

Interest 439,770 2007-08 Joint Commis sioner of Central Excise

Excise duty 197,065 2006-07, 2007-08, Assistant Commissioner 2008-09, 2009-10 of Central Excise Interest 131,555 2009-10 Additional Commissioner of Central Excise Finance Act, 1994 Service Tax 3,242,003 2004-05 Assistant Commissioner of Central Excise

Service Tax 64,685 2006-07 CESTAT

Service Tax 1,524,348 2006-07 CESTAT

* Stay granted

** Amount paid under protest Rs14,187,883

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. Based on our audit procedures and as per the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

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

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 (Auditor's Report) Order, 2003 (as amended) 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 (Auditor's Report) Order, 2003 (as amended) are not applicable to the Company.

xv. According to the information and explanations given to us, the Company has given any guarantee for loans taken by others from banks, the terms and conditions whereof, in our opinion, are not prima-facie prejudicial to the interest of the Company. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from financial institutions.

xvi. Based on information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained.

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 no funds raised on short-term basis have been used for long-term investment.

xviii. The Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under Section 301 of the Companies Act, 1956.

xix. The Company did not have any outstanding debentures during the year.

xx. The Company has not raised any money by way of public issue during the year.

xxi. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the 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 S.R. BATLIBOI & ASSOCIATES

Firm Registration Number: 101049W

Chartered .Accountants

per VIKAS KUMAR PANSARI

Partner

Membership No. 93649

Hyderabad, May 29, 2012.

---

Mar 31, 2011

1. We have audited the attached Balance Sheet of Aurobindo Pharma Limited (the Company) as at March 31, 2011 and also the Profit and 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 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 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 (Auditors Report) Order, 2003 (as amended) 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. Without qualifying our opinion, we draw attention to Note 6(d) of Schedule 23 to the financial statements with regard to non-provision of premium payable on 139,200 Zero Coupon Foreign Currency Convertible Bonds of USD 1,000 each issued by the Company. Management is of the view that the liability to pay premium on redemption is contingent and the ultimate outcome of the matter cannot be presently determined. Accordingly, no provision for the above liability that may result in future has been made in the accompanying financial statements.

5. 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 the written representations received from the Directors, as on March 31, 2011, and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on March 31, 2011 from being appointed as a director in terms of clause (g) of sub- section (1) of Section 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 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 March 31, 2011;

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

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

Annexure referred to in paragraph 3 of our report of even date

Re: Aurobindo Pharma Limited (the Company)

i. a. The Company has maintained proper records showing fuLL particulars, including quantitative details and situation of fixed assets.

b. All fixed assets have not been physically verified by the management during the year but there is a regular program of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. As informed, no material discrepancies were noticed on such verification.

c. There was no substantial disposal of fixed assets during the year.

ii. a. The management has conducted physical verification of inventory at reasonable intervals during the year.

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. 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 not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the provisions of Clause 4(iii) (a) to (d) of the Order are not applicable to the Company and hence not commented upon.

e. 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 301 of the Companies Act, 1956. Accordingly, the provisions of Clause 4(iii) (e) to (g) of the Order are not applicable to the Company and hence not commented upon.

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, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness or continuing failure to correct any major weakness in the internal control system of the Company in respect of these areas.

v. a. According to the information and explanations provided by the management, we are of the opinion that the particulars of contracts or arrangements referred to in Section 301 of the Act that need to be entered into the register maintained under Section 301 have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding value of Rupees five lakhs have been entered into during the financial year 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 the public.

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 maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under Section 209(l)(d) of the Companies Act, 1956, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained.

ix. a. Undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, cess and other material statutory dues have generally been regularly deposited with the appropriate authorities though there has been a slight delay in depositing of tax deducted at source in few cases.

Further, since the Central Government has till date not prescribed the amount of cess payable under Section 441A of the Companies Act, 1956, we are not in a position to comment upon the regularity or otherwise of the Company in depositing the same.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees state insurance, income-tax, wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and other undisputed statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

c. According to the records of the Company, there are no dues outstanding of income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty and cess on account of any dispute, other than service tax, customs duty and excise duty which are follows:

Name of the statute Nature of dues Amount Period to which the Forum where dispute is Rs. amount relates pending

Central Excise and Excise Duty 52,136,641 2007-08, The Assistant Commissioner Customs Act, 1944 2008-09, 2009-10 Appeals, Hyderabad

Excise Duty 18,604,080 2006-07, 2007-08, CESTAT, Bangalore 2008-09

Customs Duty 42,621,459* 2002-03, 2003-04, CESTAT, Chennai and Penalty 2004-05, 2005-06

Interest 439,770 2007-08 Joint Commissioner of Central Excise

Interest 5,680,233 2004-05, 2005-06, Commissioner of Central

2006-07, 2007-08 Excise 2008-09

Interest 131,555 2009-10 Assistant Commissioner of Central Excise

Excise duty 2,526,389 2005-06, 2006-07, Additional Commissioner of 2007-08, 2008-09, Central Excise, Hyderabad 2009-10, 2010-11

Finance Act, 1994 Service Tax 525,000 2005-06 CESTAT, Bangalore

Service Tax 64,685 2006-07 CESTAT, Bangalore

Service Tax 1,524,348 2006-07 CESTAT, Chennai

*Stay granted

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. Based on our audit procedures and as per the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

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

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 (as amended) 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 (as amended) 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 bank or financial institutions.

xvi. Based on information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained.

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 no funds raised on short-term basis have been used for long-term investment.

xviii. The Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under Section 301 of the Companies Act, 1956.

xix. The Company has unsecured debentures (Foreign Currency Convertible Bonds) outstanding during the year on which no security or charge is required to be created.

xx. The Company has not raised any money by way of public issue during the year.

xxi. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the 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 S.R. BATLIBOI & ASSOCIATES

Firm Registration Number: 101049W Chartered Accountants

per VIKAS KUMAR PANSARI

Partner

Membership No. 93649

Hyderabad, May 9, 2011.

---

Mar 31, 2010

1. We have audited the attached Balance Sheet of Aurobindo Pharma Limited (the Company) as at March 31, 2010 and also the Profit and 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 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 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 (Auditors Report) Order, 2003 (as amended) 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. Without qualifying our opinion, we draw attention to Note 6(d) of Schedule 23 to the financial statements with regard to non-provision of premium payable on 162,268 Zero Coupon Foreign Currency Convertible Bonds of USD 1,000 each issued by the Company. Management is of the view that the liability to pay premium on redemption is contingent and the ultimate outcome of the matter cannot be presently deterrmined. Accordingly, no provision for the above liability that may result in furture has been made in the accompanying financial statements.

5. 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 the written representations received from the Directors, as on March 31, 2010, and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on March 31, 2010 from being appointed as a director in terms of clause (g) of sub- section (1) of Section 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 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 March 31, 2010;

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

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

Annexure referred to in paragraph 3 of our report of even date

Re: Aurobindo Pharma Limited (the Company)

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

b. All fixed 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. As informed, no material discrepancies were noticed on such verification.

c. There was no substantial disposal of fixed assets during the year.

ii. a. The management has conducted physical verification of inventory at reasonable intervals during the year.

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

iii. a. As informed, the Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the provisions of clauses 4 (iii) (b), 4(iii) (c), 4 (iii) (d) of the Companies (Auditors Report) Order 2003 (as amended) are not applicable to the Company.

b. As informed, 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, the provisions of clauses 4(iii)(f) and 4(iii)(g) of the Companies (Auditors Report) Order 2003 (as amended) are not applicable to the Company.

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, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal control system of the Company.

v. a. According to the information and explanations provided by the management, we are of the opinion that the particulars of contracts or arrangements referred to in Section 301 of the Act that need to be entered into the register maintained under Section 301 have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding value of Rupees five lakhs have been entered into during the financial year 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 the public.

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 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 are of the opinion that prima facie, the prescribed accounts and records have been made and maintained.

ix. a. Undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, cess have generally been regularly deposited with the appropriate authorities though there has been a slight delay in depositing of tax deducted at source in few cases. Furuther, since the Central Government has till date not prescribed the amount of cess payable under Section 441A of the Companies Act, 1956, we are not in a position to comment upon the regularity or otherwise of the Company in depositing the same.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees state insurance, income-tax, wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and other undisputed statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

c. According to the records of the Company, there are no dues outstanding of income-tax, sales-tax, wealth-tax, service tax, customs

duty, excise duty and cess on account of any dispute, other than service tax, customs duty and excise duty which are follows:

Name of the statute Nature of dues Amount Period to which the Forum where dispute is

Rs. amount relates pending

Central Excise and Excise Duty 52,136,641 2007-08, The Assistant Commissioner

Customs Act, 1944 2008-09, 2009-10 Appeals, Hyderabad

Excise Duty 18,604,080 2006-07, 2007-08, CESTAT, Bangalore

2008-09

Customs Duty 42,621,459* 2002-03, 2003-04, CESTAT, Chennai and Penalty 2004-05, 2005-06

Interest 439,770 2007-08 Joint Commissio- ner of

Central Excise

Interest 5,680,233 2004-05, 2005-06, Commissioner of Central

2006-07, 2007-08 Excise 2008-09

Finance Act, 1994 Service Tax 525,000 2005-06 CESTAT, Bangalore

Service Tax 64,685 2006-07 CESTAT, Bangalore

Service Tax 1,524,348 2006-07 CESTAT, Chennai

Stay granted

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. Based on our audit procedures and as per the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

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

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 (as amended) 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 (as amended) 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 bank or financial institutions.

xvi. Based on information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained.

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 no funds raised on short-term basis have been used for long-term investment.

xviii. The Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under Section 301 of the Companies Act, 1956.

xix. The Company has unsecured debentures (Foreign Currency Convertible Bonds) outstanding during the year on which no security or charge is required to be created.

xx. The Company has not raised any money by way of public issue during the year.

xxi. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the 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 S.R. BATLIBOI & ASSOCIATES

Firm Registration Number: 101049W Chartered Accountants

per VIKAS KUMAR PANSARI

Partner

Membership No. 93649

Hyderabad, May 29, 2010.

---

Mar 31, 2009

1. We have audited the attached Balance Sheet of Aurobindo Pharma Limited (`the Company') as at March 31, 2009 and also the Profit and 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 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 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 (Auditors Report) Order, 2003 (as amended) 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. Without qualifying our opinion, we draw attention to Note 3(f) and 3(g) of Schedule 24 to the financial statements with regard to non-provision of premium payable on 194,600 Zero Coupon Foreign Currency Convertible Bonds of USD 1,000 each issued by the Company. Management is of the view that the liability to pay premium on redemption is contingent and the ultimate outcome of the matter cannot be presently deterrmined. Accordingly, no provision for the above liability that may result in furture has been made in the accompanying financial statements.

5. 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 the written representations received from the Directors, as on March 31, 2009, and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on March 31, 2009 from being appointed as a director in terms of clause (g) of sub- section (1) of Section 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 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 March 31, 2009;

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

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

Annexure referred to in paragraph 3 of our report of even date

Re: Aurobindo Pharma Limited (`the Company')

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

b. All fixed 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. As informed no material discrepancies were noticed on such verification.

c. There was no substantial disposal of fixed assets during the year.

ii. a. The management has conducted physical verification of inventory at reasonable intervals during the year.

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

iii. a. As informed, the Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the provisions of clauses 4 (iii) (b), 4(iii) (c), 4 (iii) (d) of the Companies (Auditors Report) Order 2003 (as amended) are not applicable to the Company.

b. As informed, 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, the provisions of clauses 4(iii)(f) and 4(iii)(g) of the Companies (Auditors Report) Order 2003 (as amended) are not applicable to the Company.

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, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas.

v. a. According to the information and explanations provided by the management, we are of the opinion that the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 that need to be entered into the register maintained under 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 such contracts or arrangements exceeding value of Rupees five lakhs have been entered into during the financial year 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 the public.

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 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 are of the opinion that prima facie, the prescribed accounts and records have been made and maintained.

ix. a. Undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, cess 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, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees state insurance, income-tax, wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and other undisputed statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

c. According to the records of the Company, there are no dues outstanding of income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty and cess on account of any dispute, other than service tax, customs duty and excise duty which are follows:

Name of the statute Nature of dues Amount Period to Forum Rs. which the where dispute is amount relates pending

Central Excise and Excise Duty 18,604,080 2006-07, CESTAT, Bangalore Customs Act, 2007-08, 1944 2008-09

Central Excise and Excise Duty 150,387 2006-07 The Commissioner Customs Act, Appeals, Hyderabad 1944

Central Excise and Customs Duty, 42,621,459* 2002-03, CESTAT Chennai Customs and Penalty 2003-04, Act, 1944 2004-05, 2005-06

Finance Act, 1994 Service Tax 2,225,066 2006-07, The Commissioner 2007-08 Appeals, Hyderabad

Finance Act, 1994 Service Tax 2,430,700 2005-06, 2006-07 The Commissioner Appeals, Hyderabad Finance Act, 1994 Service Tax 702,619 2006-07, 2007-08 CESTAT, Bangalore

*Stay granted

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. Based on our audit procedures and as per the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

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

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 (as amended) 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 (as amended) 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 bank or financial institutions.

xvi. Based on information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained.

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 no funds raised on short-term basis have been used for long-term investment.

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. The Company does not have any borrowings by way of debentures.

xx. The Company has not raised any money by way of public issue during the year.

xxi. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the 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 S.R. BATLIBOI & ASSOCIATES Chartered Accountants Per VIKAS KUMAR PANSARI Partner Membership No. 93649

Hyderabad, November 12, 2009.

---

Mar 31, 2008

1. We have audited the attached Balance Sheet of Aurobindo Pharma Limited as at March 31, 2008 and also the Profit and 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 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 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 (Auditors Report) Order, 2003 (as amended) 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 and proper returns adequate for the purposes of our audit have been received from the branches not visited by us;

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 and with the returns from the branches;

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 the written representations received from the Directors, as on March 31, 2008, and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on March 31, 2008 from being appointed as a director in terms of clause (g) of sub- section (1) of Section 274 of the Companies Act, 1956;

vi. without qualifying our opinion, we draw attention to Note 3(g) and Note 3(h) of Schedule 22 to the financial statements. Management is of the view that the liability to pay premium on redemption if any, of Foreign Currency Convertible Bonds is contingent. As the ultimate outcome of the matter cannot be presently determined, no provision has been made for liability if any, that may arise on resolution of the contingency;

vii. In our opinion and to the best of our information and according to the explanations given to us, the said accounts 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 March 31, 2008;

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

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

Annexure referred to in paragraph [ 3 ] of our report of even date

Re: Aurobindo Pharma Limited

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

b. All fixed 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. As informed no material discrepancies were noticed on such verification.

c. There was no substantial disposal of fixed assets during the year.

ii. a. The management has conducted physical verification of inventory at reasonable intervals during the year.

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

iii. a. As informed, the Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the provisions of clauses 4 (iii) (b), 4(iii) (c), 4 (iii) (d) of the Companies (Auditors Report) Order 2003 (as amended) are not applicable to the Company.

b. As informed, 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, the provisions of clauses 4(iii)(f) and 4(iii)(g) of the Companies (Auditors Report) Order 2003 (as amended) are not applicable to the Company.

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, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas.

v. a. According to the information and explanations provided by the management, we are of the opinion that the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 that need to be entered into the register maintained under 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 such contracts or arrangements exceeding value of Rupees five lakhs have been entered into during the financial year 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 the public.

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 maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under Section 209(l)(d) of the Companies Act, 1956, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained.

ix. a. Undisputed statutory dues including provident fund, investor education and protection fund, employees state insurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, cess 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, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees state insurance, income-tax, wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and other undisputed statutory dues were outstanding, at the year end, for a period of more than six months.

c. According to the records of the Company, the dues outstanding of income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty and cess on account of any dispute, are as follows:

Name of the statute Nature of dues Amount (Rs.)

Income Tax Act, 1961 Tax and interest 23,533,225

Central Excise Act, 1944 Duty 1,023,093

Central Excise Act, 1944 Duty 6,633,718

Central Excise Act, 1944 Duty 396,698

Central Excise Act, 1944 Duty 10,360,039

Central Excise Act, 1944 Duty 2,459,058

Central Excise Act, 1944 Duty 666,083

Central Excise Act, 1944 Duty 7,185,910

Central Excise Act, 1944 Duty 605,759

Central Excise Act, 1944 Duty 4,910,442

Central Excise Act, 1944 Duty 193,248

Central Excise Act, 1944 Duty 41,931,459

Period to which the Forum where dispute is amount relates pending

2003-04 Commissioner of Income Tax (Appeals)

2002-03 Joint Commissioner - Hyderabad

2004-05 Joint Commissioner - Hyderabad

2005-06 Asst. Commissioner - Hyderabad

2007-08 Commissioner - Hyderabad

2006-07 Asst. Commissioner - Hyderabad

2006-07 Joint Commissioner - Hyderabad

2006-08 Addl. Commissioner - Hyderabad

2003-04 Addl. Director General DRI, Delhi

2006-07 Deputy Commissioner - Hyderabad

2007-08 Asst. Commissioner - Hyderabad

2002-06 Commissioner - Chennai

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. Based on our audit procedures and as per the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

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

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 (as amended) 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 (as amended) are not applicable to the Company.

xv. According to the information and explanations given to us, the Company has given guarantee for loans taken by others from bank or financial institutions, the terms and conditions whereof in our opinion are not prima-facie prejudicial to the interest of the Company.

xvi. Based on information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained.

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 no funds raised on short-term basis have been used for long-term investment.

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. The Company does not have any outstanding debentures during the year.

xx. The Company has not raised any money by way of public issue during the year.

xxi. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the 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 S. R. BATLIBOI & CO. Chartered Accountants

Per RAHUL ROY Partner Membership No. 53956 Kolkata, June 18, 2008.

---

Mar 31, 2007

1. We have audited the attached Balance Sheet of Aurobindo Pharma Limited as at March 31, 2007 and also the Profit and Loss Account and the 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 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 (as amended) 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 and proper returns adequate for the purposes of our audit have been received from the branches not visited by us;

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 and with the returns from the branches;

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 the written representations received from the Directors, as on March 31, 2007, and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on March 31, 2007 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956;

vi. without qualifying our opinion, we draw attention to Note 3(h) and Note 3(i) of Schedule 22 to the financial statements. Management is of the view that the liability to pay premium on redemption if any, of Foreign Currency Convertible Bonds is contingent. As the ultimate outcome of the matter cannot be presently determined no provision has been made for liability if any, that may arise on resolution of the contingency;

vii. In our opinion and to the best of our information and according to the explanations given to us, the said accounts 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 March 31, 2007;

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

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

For S. R. BATLIBOI & CO. Chartered Accountants

Per RAHUL ROY Partner Membership No. 53956

Kolkata, June 30, 2007

Annexure referred to in paragraph [3] of our report of even date

Re: Aurobindo Pharma Limited

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

b. All fixed 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. As informed, discrepancies noticed on such verification have been dealt with in the books of account.

c. There was no substantial disposal of fixed assets during the year.

ii. a. The management has conducted physical verification of inventory at reasonable intervals during the year.

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

iii. a. As informed, the Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the provisions of clauses 4 (iii) (b), 4(iii) (c), 4 (iii) (d) of the Companies (Auditor's Report) Order 2003 (as amended) are not applicable to the Company.

b. As informed, 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, the provisions of clauses 4(iii)(f) and 4(iii)(g) of the Companies (Auditor's Report) Order 2003 (as amended) are not applicable to the Company.

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, for the purchase of inventory and fixed assets and for the sale of goods and services.

During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas.

v. a. According to the information and explanations provided by the management, we are of the opinion that the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 that need to be entered into the register maintained under 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 such contracts or arrangements exceeding value of Rupees five lakhs have been entered into during the financial year 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 the public.

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 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 are of the opinion that prima facie, the prescribed accounts and records have been made and maintained.

ix. a. Undisputed statutory dues including provident fund, investor education and protection fund, employees' state insurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, cess 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, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees' state insurance, income-tax, wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and other undisputed statutory dues were outstanding, at the year end, for a period of more than six months.

c. According to the records of the Company, the dues outstanding of income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty and cess on account of any dispute, are as follows:

Name of the statute Nature of dues Amount (Rs.)

Income Tax Act, 1961 Tax and interest 23,533,225 Central Excise Act, 1944 Duty 1,023,093 Central Excise Act, 1944 Duty 6,633,718 Central Excise Act, 1944 Duty 40,085 Central Excise Act, 1944 Duty 36,690,537 Central Excise Act, 1944 Duty 396,698

Period to which the Forum where dispute is amount relates pending

2003-04 Commissioner of Income Tax (Appeals) 2002-03 Joint Commissioner - Hyderabad 2004-05 Joint Commissioner - Hyderabad 2004-05 Commissioner - Hyderabad 2005-06 Commissioner - Hyderabad 2005-06 Asst. Commissioner - Hyderabad

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. Based on our audit procedures and as per the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

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

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 (Auditor's Report) Order, 2003 (as amended) 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 (Auditor's Report) Order, 2003 (as amended) are not applicable to the Company.

xv. According to the information and explanations given to us, the Company has given guarantee for loans taken by others from bank or financial institutions, the terms and conditions whereof in our opinion are not prima-facie prejudicial to the interest of the Company.

xvi. Based on information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained.

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 no funds raised on short-term basis have been used for Long-term investment.

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. The Company does not have any outstanding debentures during the year.

xx. The Company has not raised any money by way of public issue during the year.

xxi. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the 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 S. R. BATLIBOI & CO. Chartered Accountants

Per RAHUL ROY Partner Membership No. 53956

Kolkata, June 30, 2007

---

Mar 31, 2006

ANNUAL REPORT 2005-2006

AUDITORS' REPORT

To The Members of Aurobindo Pharma Limited

1. We have audited the attached Balance Sheet of Aurobindo Pharma Limited as at March 31, 2006 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 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 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 (as amended) 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 and proper returns adequate for the purposes of our audit have been received from the branches not visited by us;

iii. the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account and with the returns from the branches;

iv. in our opinion, the Balance Sheet, Profit & 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 the written representations received from the Directors, as on March 31, 2006, and taken on record by the Board of Directors, we report that none of the Directors is disqualified as on March 31, 2006 from being appointed as a director in terms of clause (g) of subsection (1) of Section 274 of the Companies Act, 1956;

vi. without qualifying our opinion, we draw attention to Note 3(g) of Schedule 24 to the financial statements. The management is of the view that the liability to pay premium on redemption is contingent, the ultimate outcome of the matter cannot be presently determined and no provision for any liability that may result in future has been made in the financial statements.

vii. we draw attention to the following notes in Schedule 24:

a. Non compete fee of Rs.300 million arising in the year 2001-02 pursuant to the transfer of certain business of the Company to a Joint Venture Company (as referred in note 5 of Schedule 24) was directly accounted in the capital reserve instead of being routed through the Profit & Loss Account and accordingly qualified by us in our audit report for the said year. During the current year, write off of the same has been made directly against the capital reserve instead of routing the same through the Profit & Loss Account. This has no impact on the profit for the year.

b. no provision has been made for diminution in the value of certain investments referred to in Note 9 b). on Schedule 24, since in the opinion of the management such investments are strategic in nature and such diminution is not other than temporary. We are unable to comment upon the impact, if any, of such diminution on the Accounts.

viii. Subject to paragraph vii. above, in our opinion and to the best of our information and according to the explanations given to us, the said accounts 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 March 31, 2006;

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

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

For S.R. BATLIBOI & CO. Chartered Accountants

Per RAHUL ROY Partner Membership No.: 53956 Kolkata, 27 June, 2006

Annexure 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. All fixed 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. As informed, no material discrepancies were noticed on such verification.

c. There was no substantial disposal of fixed assets during the year.

ii. a. The management has conducted physical verification of inventory at reasonable intervals during the year.

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

iii. a. As informed, the Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the provisions of clauses 4(iii)(b), 4(iii)(c), 4(iii)(d) of the Companies (Auditor's Report) Order 2003 (as amended) are not applicable to the Company.

e. As informed, 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, the provisions of clauses 4(iii)(f) and 4(iii)(g) of the Companies (Auditor's Report) Order 2003 (as amended) are not applicable to the Company.

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, for the purchase of inventory and fixed assets and for the sale of goods and services. During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas.

v. a. According to the information and explanations provided by the management, we are of the opinion that the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 that need to be entered into the register maintained under 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 such contracts or arrangements exceeding value of Rupees five lakhs have been entered into during the financial year 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 the public.

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 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 are of the opinion that prima facie, the prescribed accounts and records have been made and maintained.

ix. a. Undisputed statutory dues including provident fund, investor education and protection fund, employees' state insurance, income-tax, sales-tax, wealth-tax, service tax, customs duty, excise duty, cess 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, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees' state insurance, income-tax, wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and other undisputed statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable except work- contract tax of Rs. 169,220.

c. According to the records of the Company, the dues outstanding of income- tax, sales-tax, wealth-tax, service tax, customs duty, excise duty and cess on account of any dispute, are as follows:

Name of the Nature of Amount Period to Forum where statute dues (Rs.) which the dispute is amount pending relates

Income Tax Tax and 136,940,476 1999-00 to Commissioner of Act, 1961 interest 2002-03 Income Tax (Appeals)

Central Excise Duty 5,055,615 1999-00 CEGAT - Chennai Act, 1944

Central Excise Duty 1,023,093 2002-03 Joint Act, 1944 Commissioner - Hyderabad

Central Excise Duty 299,948 2003-04 Commissioner - Act, 1944 Hyderabad

Central Excise Duty 8,526,214 2004-05 Joint Act, 1944 Commissioner - Hyderabad

Central Excise Duty 1,105,552 2004-05 Commissioner - Act, 1944 Hyderabad

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. Based on our audit procedures and as per the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

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

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 (Auditor's Report) Order, 2003 (as amended) 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 (Auditor's Report) Order, 2003 (as amended) are not applicable to the Company.

xv. According to the information and explanations given to us, the Company has given guarantee for loans taken by others from bank or financial institutions, the terms and conditions whereof in our opinion are not prima-facie prejudicial to the interest of the Company.

xvi. Based on information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained.

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 no funds raised on short-term basis have been used for long-term investment.

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. Based on books and records produced to us by the management, securities have been created in respect of debentures issued. The Company has unsecured debentures outstanding during the year on which no security or charge is required to be created.

xx. We have verified that the end use of money raised by public issues is as disclosed in the notes to the financial statements.

xxi. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the 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 S.R. BATLIBOI & CO. Chartered Accountants

Per RAHUL ROY Partner Membership No.: 53956 Kolkata, 27 June, 2006

---

Mar 31, 2005

1. We have audited the attached Balance. Sheet of Aurobindo Pharma Limited as at March 31, 2005 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 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 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 (as amended) 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 and proper returns adequate for the purposes of our audit have been received from the branches not visited by us;

iii. the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account and with the returns from the branches;

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 the written representations received from the Directors, as on March 31, 2005, and taken on record by the Board of Directors, we report that none of the Directors was disqualified as on March 31, 2005 from being appointed as a Director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956;

vi. without qualifying our opinion, we draw attention to the following notes in Schedule 24:

a. note No.10 regarding diminution in the value of certain investments in subsidiaries which in the opinion of the management is temporary in nature and loans to the said subsidiaries, which in the opinion of the management is fully recoverable.

b. note No. 11 regarding amounts due from a joint venture company, which in the opinion of the management is good and recoverable. we have relied upon the information and explanations provided by the management in respect of the matters cited above.

vii. in our opinion and to the best of our information and according to the explanations given to us, the said accounts 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 March 31, 2005;

b. in the case of the Profit & Loss Account, of the profit for the year ended on that date; and

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

For S. R. BATLIBOI & CO. Chartered Accountants

Per UTKARSH PALNITKAR Partner Membership No. 40030

Hyderabad, June 30, 2005.

Annexure referred to in paragraph [3] of our report of even date

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

b. All fixed assets have not been physically verified by the management during the year. However, 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. As informed, no material discrepancies were noticed on such verification.

c. There was no substantial disposal of fixed assets during the year.

ii. a. The management has conducted physical verification of inventory at reasonable intervals during the year.

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

iii. a. As informed, the Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly, the provisions of clauses 4(iii)(b), 4(iii)(c) and 4(iii)(d) of the Companies (Auditor's Report) Order, 2003 (as amended) are not applicable to the Company.

b. As informed, 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, the provisions of clauses 4(iii)(f) and 4(iii)(g) of the Companies (Auditor's Report) Order, 2003 (as amended) are not applicable to the Company

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, for the purchase of inventory, fixed assets and for the sale of goods and services. During the course of our audit, no major weakness has been noticed in the internal control system in respect of these areas.

v. a. According to the information and explanations provided by the management, we are of the opinion that the particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 that need to be entered into the register maintained under Section 301 have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding value of five lakh rupees have been entered into during the financial year at prices, which are reasonable, having regard to the prevailing market prices at the relevant time.

vi. The Company has not accepted any deposit from the public.

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 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 in respect of the products of the Company, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained.

ix. a. Undisputed statutory dues including provident fund, investor education and protection fund, employees' state insurance, income-tax, sales-tax, wealth-tax, service tax, custom duty, excise duty, cess and other material statutory dues 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, no undisputed amounts payable in respect of provident fund, investor education and protection fund, employees' state insurance, income-tax, wealth-tax, service tax, sales-tax, customs duty, excise duty, cess and other undisputed statutory dues were outstanding, at the year end for a period of more than six months from the date they became payable.

c. According to the records of the Company and on the basis of the information and explanations given to us, the dues outstanding of income-tax, sales tax, wealth-tax service tax, custom duty, excise duty and cess on account of any dispute, are as under:

Name of the Nature of statue Dues

Income Tax Disallowance on account of Act, 1961 dispute of deduction under Section 80 HHC, 80 IA, Foreign agency commission etc.,

Income Tax Disallowance on account of Act, 1961 dispute of deduction under Section 80 HHC, 80 IA, foreign agency commission, non- compete fee, interest under 234 and 234 B & C etc.,

Central Excise Dispute regarding credit on Act, 1944 inputs exclusively used in the manufacture of exempted goods.

Central Excise Dispute regarding dutibility on Act, 1944 Intermediates

Central Excise Dispute regarding differential Act, 1944 duty on spent solvents.

Central Excise Dispute regarding valuation of Act, 1944 as such inputs transfer from one unit to other unit

Central Excise Valuation dispute in case of inter Act, 1944 unit transfers

Amount Period to Forum where (Rs.) which the dispute is Amount relates pending

37,715,190 1998-99 Commissioner of Income Tax (Appeals) 145,208,638 2001-02 Commissioner of Income Tax (Appeals)

579,269 From 2000-01 Commissioner- onwards Hyderabad

5,663,134 2000-01 Tribunal, Bangalore

2,149,617 From 1996-97 Additional to 2000-01 Commissioner - Hyderabad

655,740 2003-04 Joint Commissioner - Hyderabad

5,055,615 1999-00 CEGAT - Chennai

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. Based on our audit procedures and as per the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

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

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 (Auditor's Report) Order, 2003 (as amended) 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 (Auditor's Report) Order, 2003 (as amended), are not applicable to the Company.

xv. According to the information and explanations given to us, the Company has given guarantee for loans taken by others from bank or financial institutions, the terms and conditions whereof in our opinion are not prima-facie prejudicial to the interest of the Company.

xvi. Based on information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained.

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

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

xix. Based on books and records produced to us by the management, securities have been created in respect of debentures issued.

xx. The Company has not raised any money by public issue during the year, accordingly the provisions of Clause 4(xx) of the Companies (Auditor's Report) Order, 2003 (as amended) are not applicable to the Company.

xxi. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the 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 S. R. BATLIBOI & CO. Chartered Accountants

Per UTKARSH PALNITKAR Partner Membership No. 40030

Hyderabad, June 30, 2005.

---

Mar 31, 2004

1. We have audited the attached Balance Sheet of Aurobindo Pharma Limited as at 31st March, 2004 and also the Profit and Loss account and the Cash Row 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 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 and proper returns adequate for the purposes of our audit have been received from the branches not visited by us;

iii. the Balance Sheet, Profit and Loss Account and Cash Row Statement dealt with by this report are in agreement with the books of account and with the returns from the branches;

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 the written representations received from the Directors, as on 31st March, 2004, and taken on record by the Board of Directors, we report that none of the directors was disqualified as on 31st March, 2004 from being appointed as a director in terms of clause (g) of sub-section (1) of section 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 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, 2004;

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

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

For S. R. BATLIBOI & CO. Chartered Accountants

Per UTKARSH PALNITKAR Partner Membership No. 40030 Hyderabad, 2nd June, 2004.

Annexure referred to in paragraph [3] of our report of even date

Re: Aurobindo Pharma Limited

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

b. All fixed 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. As informed, material discrepancies were identified on such verification and these have been properly dealt with in the books of account.

c. There was no substantial disposal of fixed assets during the year.

ii. a. The management has conducted physical verification of inventory at reasonable intervals during the year.

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

iii. The Company has neither granted nor taken any loans, secured or unsecured to/from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956.

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 and for the sale of goods. During the course of our audit, no major weakness has been noticed in the internal controls in respect of these areas.

v. a. 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 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 the prevailing market prices at the relevant time.

vi. The Company has not accepted any deposit from the public.

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 accounts 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 in respect of the products of the Company, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained.

ix. a. Undisputed statutory dues including provident fund, investor education and protection fund, employees' state insurance, income-tax, sales-tax, wealth-tax, custom duty, excise duty, cess 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, no undisputed amounts payable in respect of income-tax, wealth-tax, sales-tax, customs duty and excise duty were outstanding, at the year end for a period of more than six months from the date they became payable.

c. According to the records of the Company and on the basis of the information and explanations given to us, the dues in respect of sales-tax, income-tax, custom duty, wealth-tax, excise duty, cess which have not been deposited on account of any dispute, are as under:

Name of the Nature of Amount Period to statute dues (Rs.) which the amount relates

Income Tax Disallowance on 44,601,668 2000-01 Act, 1961 account dispute on computation of eligible profits under Section 80 HHC.

Income Tax Shortfall in tax 4,151,300 2001-02 Act, 1961 deducted at source. (Appeals)

Central Excise Dispute regarding 16,810,047 From 1996-97 Act, 1944 credit on inputs onwards exclusively used in the manufacture of exempted goods,

Central Excise Dispute regarding CENVAT 55,161,402 From 1998-99 Act, 1944 Claim and Dispute onwards regarding applicable rate of duty on certain products

Name of the Forum where statute dispute is pending

Income Tax Commissioner of Act, 1961 Income Tax (Appeals)

Income Tax Commissioner of Act, 1961 Income Tax (Appeals)

Central Excise Commissioner/ Act, 1944 Jt. Commissioner/ Addl. Commissioner of various states

Central Excise CESTAT Chennai Act, 1944 & Bangalore

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. Based on our audit procedures and as per the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to a financial institution, bank or debenture holders.

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

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 (Auditor's 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 (Auditor's Report) Order, 2003 are not applicable to the Company.

xv. According to the information and explanations given to us, the Company has given guarantee for loans taken by others from bank or financial institutions, the terms and conditions whereof in our opinion are not prima-facie prejudicial to the interest of the Company.

xvi. Based on information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained.

xvii. According to the information and explanations given to us and on an overall examination of the balance sheet and cash flow statement of the Company, we report that no funds raised on short-term basis have been used for long-term investment and long-term funds have been used to finance short-term assets (excluding permanent working capital) to the extent of Rs.1,382,940,638.

xviii. The Company has made preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956. In our opinion the price at which shares have been issued is not prejudicial to the interest of the Company.

xix. Based on books and records produced to us by the management, securities have been created in respect of debentures issued.

xx. We have verified that the end use of money raised by public issues is as disclosed in the notes to the financial statements.

xxi. Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the 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 S. R. BATLIBOI & CO. Chartered Accountants

Per UTKARSH PALNITKAR Partner Membership No. 40030 Hyderabad, 2nd June, 2004.

---

Mar 31, 2003

1. We have audited the attached Balance Sheet of Aurobindo Pharma Limited, as at 31st March 2003 and also the 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 the 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 Manufacturing and Other Companies (Auditor's Report) Order, 1988 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 and 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 and 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 from the directors, as on 31st March, 2003, and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March 2003 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 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 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, 2003; in the case of the Profit and Loss Account, of the profit for the year ended on that date; and

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

1. The Company has maintained proper records to show full particulars including quantitative details and situation thereof of its fixed assets. As explained to us, physical verification of a substantial part of the fixed assets was conducted by the management during the year, under a phased programme, which in our opinion is reasonable having regard to the size of the Company and the nature of its assets. The discrepancies noticed on such verification, which were not material, have been properly dealt with in the books of account.

2. None of the fixed assets have been revalued during the year.

3. The stocks of finished goods, stores, spare parts and raw materials have been physically verified during the year by the management. In our opinion, the frequency of such verification is reasonable.

4. The procedures of physical verification of stocks followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business..

5. The discrepancies noticed on such verification between the physical stocks and the book records, which were not material, have been properly dealt with in the books of account.

6. On the basis of our examination, we are of the opinion that the valuation of stocks is fair and proper in accordance with the normally accepted accounting principles and is on the same basis as in the preceding year.

7. The Company has not taken any loans, secured or unsecured, from companies, firms or other parties listed in the register maintained under Section 301 of the Compan-ies Act, 1956 (the Act) or from the companies under the same management as defined under Sub-section (1B) of Section 370 of the Act.

8. The Company has not granted any loans, secured or unsecured, to firms or other parties listed in the register maintained under Section 301 of the Act or to the companies under the same management as defined under sub-section (1B) of Section 370 of the Act.

9. The parties to whom loans and advances in the nature of loans have been given are repaying the principal amounts as stipulated and are also regular in payment of interest where applicable.

10. 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 with regard to purchases of stores, raw materials including components, plant and machinery, equipment and other assets and for the sale of goods.

11. In our opinion and according to the information and explanations given to us, the transactions of purchase of goods and materials and sale of goods, materials and services made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Act and aggregating during the year to Rs.50,000 or more in respect of each party, have been made at prices which are reasonable having regard to prevailing market price for such goods, materials or services or the prices at which transactions for similar goods, materials or services have been made with other parties.

12. As explained to us, the Company has a regular procedure for the determination of unserviceable or damaged stores, raw materials and finished goods and adequate provision for loss thereon has been made in the accounts.

13. The Company ^as not accepted any deposits from public, in terms of Section 58A of the Act.

14. In our opinion, reasonable records have been maintained by the Company for the sale and disposal of realisable by-products and scrap.

15. The Company has an internal audit system, commensurate with its size and nature of its business.

16. We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under Section 209(l)(d) of the Act, and are of the opinion that prima facie the prescribed accounts and records have been maintained. We have not, however, made a detailed examination of the records with a view to determining whether they are accurate or complete.

17. According to the records of the Company Provident Fund and Employees' State Insurance dues have been regularly deposited during the year with the appropriate authorities.

18. There are no undisputed amounts payable in respect of income tax, wealth tax, customs duty and excise duty and sales tax which have remained outstanding as at 31st March, 2003, for a period of more than six months from the date they became payable, except for sale tax of Rs. 23,904 which has since been paid.

19. According to the information and explanations given to us, no personal expenses of employees or Directors have been charged to revenue account, other than those payable under contractual obligations or in accordance with the generally accepted business practice.

20. The Company is not a sick industrial company within the meaning of clause (o) of sub-section (1) of Section 3 of the Sick Industrial Companies (Special Provision) Act, 1985.

21. In respect of trading activity, damaged goods have been determined and provision for loss thereof has been made in the accounts, where necessary.

For S.R.Batliboi & Co., Chartered Accountants

Utkarsh Palnitkar

Partner

Place: Hyderabad Date : June 30, 2003.

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Mar 31, 2002

1. We have audited the attached Balance Sheet of Aurobindo Pharma Limited, as at 31st March 2002 and also the Profit and Loss Account 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 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 the 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 Manufacturing and Other Companies (Auditors Report) Order, 1988 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) the Company has included non-compete fee of Rs. 300,000,000 under capital reserve in Reserves and Surplus in Schedule 2 as referred to in Note no. 10 c) of Schedule 24. This is contrary to Accounting Standard (AS) 9 "Revenue Recognition" issued by the Institute of Chartered Accountants of India. Had the said amount been taken to Profit and Loss Account, the profit for the year would have been higher by Rs. 300,000,000.

subject to the above, 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 and Profit and Loss Account dealt with by this report are in agreement with the books of account;

iv) subject to 4 (ii) supra, 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;

v) on the basis of written representations received from the directors, as on 31st March, 2002, and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March 2002 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956;

vi) attention is drawn to the following notes on schedule 24

a) Note no. 8, regarding disposal/transfer of assets of the Companys manufacturing unit at Pondicherry, which is subject to the approval of shareholders as required under the provisions of Section 293(1) (a) of the Companies Act, 1956;

b) Note no. 10 a) and b), regarding the values, of specified brands taken over at Rs. 100,000,000 and non-compete fee of Rs. 300,000,000, comprising in the consideration payable for the takeover of the Companys ethical allopathic branded formulations business by the joint venture company, are as mutually agreed to between the parties to the joint venture and are relied upon by the Auditors.

vii) in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, in the manner so required, and subject to para 4 (ii) and (vi) a) and b) above, 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, 2002; and

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

1. The Company has maintained proper records to show full particulars including quantitative details and situation thereof of its fixed assets. As explained to us, physical verification of a substantial part of the fixed assets was conducted by the management during the year, under a phased programme, which in our opinion is reasonable having regard to the size of the Company and the nature of its assets. The discrepancies noticed on such verification, which were not material, have been properly dealt with in the books of account.

2. None of the fixed assets have been revalued during the year.

3. The stocks of finished goods, stores, spare parts and raw materials have been physically verified during the year by the management. In our opinion, the frequency of such verification is reasonable.

4. The procedures of physical verification of stocks followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

5. The discrepancies noticed on such verification between the physical stocks and the book records, which were not material, have been properly dealt with in the books of account.

6. On the basis of our examination, we are of the opinion that the valuation of stocks is fair and proper in accordance with the normally accepted accounting principles and is on the same basis as in the preceding year.

7. The Company has not taken any loans; secured or unsecured, from companies, firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956 (the Act). In terms of Sub-section (6), the provisions of Section 370 (1B) are not applicable on or after 31st October 1998.

8. The Company has not granted any loans, secured or unsecured, to firms or other parties listed in the register maintained under Section 301 of the Companies Act, 1956 (the Act). As regards unsecured loans granted to a Company listed in the register maintained under Section 301 of the Act, the rate of interest and terms and conditions of such loans are not prima facie prejudicial to the interest of the Company. In terms of Sub-section (6), the provisions of Section 370 (1B) are not applicable on or after 31st October 1998.

9. The parties to whom loans and advances in the nature of loans have been given are repaying the principal amounts as stipulated and are also regular in payment of interest where applicable.

10. 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 with regard to purchases of stores, raw materials including components, plant and machinery, equipment and other assets and for the sale of goods.

11. In our opinion and according to the information and explanations given to us, the transactions of purchase of goods and materials and sale of goods, materials and services made in pursuance of contracts or arrangements entered in the register maintained under Section 301 of the Act and aggregating during the year to Rs. 50,000 or more in respect of each party, have been made at prices which are reasonable having regard to prevailing market price for such goods, materials or services or the prices at which transactions for similar goods, materials or services have been made with other parties.

12. As explained to us, the Company has a regular procedure for the determination of unserviceable or damaged stores, raw materials and finished goods and adequate provision for loss thereon has been made in the accounts.

13. The Company has not accepted any deposits from public, in terms of Section 58A of the Act.

14. In our opinion, reasonable records have been maintained by the Company for the sale and disposal of realisable by-products and scrap.

15. The Company has an internal audit system, which needs further strengthening in certain areas so as to be commensurate with its size and nature of its business.

16. We have broadly reviewed the books of account 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 Act, and are of the opinion that prima facie the prescribed accounts and records have been maintained. We have not, however, made a detailed examination of the records with a view to determining whether they are accurate or complete.

17. According to the records of the Company Provident Fund and Employees State Insurance dues have been regularly deposited during the year with the appropriate authorities.

18. There are no undisputed amounts payable in respect of income tax, wealth tax, customs duty and excise duty and sales tax which have remained outstanding as at 31st March, 2002, for a period of more than six months from the date they became payable.

19. According to the information and explanations given to us, no personal expenses of employees or Directors have been charged to revenue account, other than those payable under contractual obligations or in accordance with the generally accepted business practice.

20. The Company is not a sick industrial company within the meaning of clause (o) of sub-section (1) of Section 3 of the Sick Industrial Companies (Special Provision) Act, 1985.

21. In respect of trading activity, damaged goods have been determined and provision for loss thereof has been made in the accounts, where necessary.

S. R. Batliboi & Co., Chartered Accountants

per Utkarsh Palnitkar Partner

Place: Hyderabad Date: June 30, 2002.