Auditor Report of JHS Svendgaard Laboratories Ltd.

Mar 31, 2025

We have audited the accompanying standalone financial
statements of JHS Svendgaard Laboratories Limited (the
"Company"), which comprise the Balance Sheet as at 31 March
2025, the statement of profit and loss (including other
comprehensive income), the statement of changes in equity and
the statement of cash flows for the year ended on that date and a
summary of significant accounting policies and other explanatory
information on (hereinafter referred to as the "standalone
financial statements").

Opinion

In our opinion and to the best of our information and according to
the explanations given to us, the aforesaid standalone financial
statements give the information required by the 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 31 March 2025 and its
loss, total comprehensive income, changes in equity and its cash
flows 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 Responsibilities
for the Audit of the Standalone Financial Statements section of our
report. We are independent of the Company in accordance with
the Code of Ethics issued by the Institute of Chartered
Accountants of India ("ICAI") together with the 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.

Emphasis of Matters

We draw attention to the following matters in the Notes to the
financial statements:

a) Footnote under Note 7 (Deferred tax assets (net)) to the
financial statements which describes the Company''s
reassessment of the virtual certainty of its carry-forward
losses. Based on this review, the company has revised its
Deferred Tax Asset by Rs. 718.84 lakhs approx. and has
recognized the impact of this adjustment in the financial
statements for the period under review resulting in negative
impact on profit after tax to that extent.

b) Footnote under Note 3.1 (Property, plant and equipment) to
the financial statements, which describes that the company
has carried out detailed physical and technical inspection
wherein number of machines which have become
technologically obsolete were impaired to the extent of Rs.
285.94 lakhs to reflect the fair value as per Ind AS. The same is
reflected under exceptional items in the accompanying profit
and loss statement.

c) Footnote under Note 10 (Inventories) to the financial
statements, which describes the provision of Rs. 263.02
Lakhs made for obsolete inventory. Attention is drawn as the
amount is material with respect to turnover of the company.

d) Footnote under Note 11 (Trade Receivables) to the financial
statements, which describes the provision of Rs. 156.29 lakhs
and write off of Rs. 72.23 lakhs made for Trade Receivables.
Attention is drawn as the amount is material with respect to
turnover of the company.

e) Footnote under Note 9 (Other non-current assets) to the
financial statements which deals with the Capital Advances
given in earlier years to various parties amounting to Rs.
2,895.13 lakhs for seffing up new production manufacturing
facilities in Himachal Pradesh and Rs. 1,328.30 lakhs through
its wholly owned subsidiary, towards pre-emption rights in
the upcoming project in Union Territory of Jammu & Kashmir.
Management has considered the above amounts same
recoverable and adjustable against the future expansion
plans.

Our Opinion is not modified in respect of these matters.

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.

1	Key Audit Matter	Auditor''s Response
1	Revenue recognition Revenue from the sale of goods (hereinafter referred to as "Revenue") is recognized when the company performs its obligation to its customers and the amount of revenue can be measured reliably and recovery of the consideration is probable. The timing of such recognition in the case of sale of goods is when the control over the same is transferred to the customer, which is mainly upon delivery. The timing of revenue recognition is relevant to the reported performance of the Company. The management considers revenue as a key measure for evaluation of performance. Refer Note 2(a) to the Standalone Financial Statements - Significant accounting policies.	Principal audit procedures Our audit approach was a combination of test of internal controls and substantive procedures including: • Assessing the appropriateness of the Company''s revenue recognition accounting policies in line with IND AS 115 ("Revenue from Contracts with Customers") and testing thereof. • Evaluating the design and implementation of Company''s controls in respect of revenue recognition. • Testing the effectiveness of such controls over revenue cut off at year-end. • We performed substantive testing by selecting samples of revenue transactions recorded during the year by verifying the underlying documents, which included goods dispatch notes and shipping documents. • Performing analytical procedures on current year revenue based on monthly trends and where appropriate, conducting further enquiries and testing. • Based on the above procedure performed, the recognition and measurement of revenue from sale of goods are considered to be adequate and reasonable.
2	Assessment of impairment of assets and provisioning for the same The company holds significant balances of property, plant and equipment, trade receivables, and inventories. Management is required to assess these assets for indicators of impairment or irrecoverability of PPE, trade receivables, and inventories and to determine appropriate provisions where necessary. These evaluations involve significant management judgment and estimates, Given the degree of estimation and judgment involved, and the material nature of provision for impairment done by the management, we have identified the evaluation of these provisions as a key audit matter. Refer Note 2(f), 1(c)(v) & 2(h) to the Standalone Financial Statements - Significant accounting policies	Principal audit procedures For impairment of Fixed Assets: • Evaluating the methodologies used by management to assess indicators of impairment. • Chartered Engineer was engaged to conduct a technical assessment of certain machinery and equipment at our manufacturing facility. Following the expert''s recommendation, the carrying values of these assets have been impaired to reflect their recoverable (scrap/realisable) value. • Assessing the assumptions used in determining value-in-use calculations, including projected cash flows, growth rates, and discount rates, with the involvement of our valuation specialists. For doubtful debts: • We evaluated the design and implementation of controls over the credit risk assessment process. • We tested the ageing of receivables, assessed historical loss trends, and reviewed management''s forward-looking assumptions used in the expected credit loss model. • We performed detailed analyses of significant customer balances, including subsequent receipts and communications with customers, to assess recoverability. For obsolete inventory: • We assessed the inventory provisioning methodology against historical trends and industry practices. • We performed ageing analyses and discussed with management the rationale for provisions recorded against specific inventory lines, particularly slow-moving or obsolete stock. • We performed physical inventory observations to assess the condition of inventory held.

Management''s Responsibility for the Standalone Ind AS

Financial Statements

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

2. 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.

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

Auditor''s Responsibility

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

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

• Identify and assess the risks of material
misstatement of the financial statements, whether
due to fraud or error, design and perform audit
procedures responsive to those risks, and obtain

audit evidence that is sufficient and appropriate to
provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as
fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of
internal control.

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

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

• Conclude on the appropriateness of management''s
use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a
material uncertainty exists related to events or
conditions that may cast significant doubt on the
Company''s ability to continue as a going concern. If
we conclude that a material uncertainty exists, we
are required to draw attention in our auditor''s report
to the related disclosures in the 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 financial statements, including the
disclosures, and whether the financial statements
represent the underlying transactions and events in
a manner that achieves fair presentation.

3. 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.

4. 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.

5. 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.

6. 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 sub-section (11) of section 143 of the
Companies Act, 2013, 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 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 31st March, 2025 taken on
record by the Board of Directors, none of the
directors is disqualified as on 31st March, 2025 from
being appointed as a director in terms of Section 164
(2) of the Act.

f) With respect to the adequacy of the internal
financial controls over financial reporting of the
Company and the operating effectiveness of such
controls, refer to our separate Report in ''Annexure
B''. Except for the effects of the material
weakness(es) described below, the Company has
maintained, in all material respects, effective

internal control over financial reporting as of 31^st
March, 2025.

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:

• The Company has disclosed the impact of pending
litigations on its financial position in its financial
statements - Refer Note 36 to the financial
statements;

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

• There were no amounts that were required to be
transferred, to the Investor Education and
Protection Fund by the Company.

• (a) The management has represented that, to the

best of its knowledge and belief, 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, whether, directly or indirectly lend or
invest in other persons or entities identified in
any manner whatsoever by or on behalf of the
company ("Ultimate Beneficiaries") or provide
any guarantee, security or the like on behalf of
the Ultimate Beneficiaries;

(b) The management has represented, that, to the
best of its knowledge and belief, 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, whether,
directly or indirectly, lend or invest in other
persons or entities identified in any manner
whatsoever by or on behalf of the Funding
Party ("Ultimate Beneficiaries") or provide any
guarantee, security or the like on behalf of the
Ultimate Beneficiaries; and

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

• No dividend has been declared or paid during the
year by the company.

• Based on our examination which included test
checks, the Company has used an accounting
software for maintaining its books of account which
has a feature of recording audit trail (edit log) facility
and the same has operated throughout the year for
all relevant transactions recorded in the software.
Further, during the course of our audit we did not
come across any instance of the audit trail feature
being tampered with.

• 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, 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.

For V.K. Khosla & Co.

Chartered Accountants

FRN 002283N

Sd/-

Amit Khosla

(Partner)

Memb No. 095943

UDIN: 25095943BMJJNW9345

Place: New Delhi

Date: May 27, 2025

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Mar 31, 2024

JHS SVENDGAARD LABORATORIES LIMITED

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying standalone financial statements of JHS Svendgaard Laboratories Limited (the "Company"), which comprise the Balance Sheet as at 31 March 2024, the statement of profit and loss (including other comprehensive income), the statement of changes in equity and the statement of cash flows for the year ended on that date 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 31 March 2024 and its loss, total comprehensive income, changes in equity and its cash

flows 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 Responsibilities for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India ("ICAI") together with the 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.

#	Key Audit Matter	Auditor''s Response
1	Revenue recognition Revenue from the sale of goods (hereinafter referred to as "Revenue") is recognized when the company performs its obligation to its customers and the amount of revenue can be measured reliably and recovery of the consideration is probable. The timing of such recognition in the case of sale of goods is when the control over the same is transferred to the customer, which is mainly upon delivery. The timing of revenue recognition is relevant to the reported performance of the Company. The management considers revenue as a key measure for evaluation of performance. Refer Note 2.1. (a) to the Standalone Financial Statements - Significant accounting policies.	Principal audit procedures Our audit approach was a combination of test of internal controls and substantive procedures including: • Assessing the appropriateness of the Company''s revenue recognition accounting policies in line with Ind AS 115 ("Revenue from Contracts with Customers") and testing thereof. • Evaluating the design and implementation of Company''s controls in respect of revenue recognition. • Testing the effectiveness of such controls over revenue cut off at year-end. • We performed substantive testing by selecting samples of revenue transactions recorded during the year by verifying the underlying documents, which included goods dispatch notes and shipping documents. • Performing analytical procedures on current year revenue based on monthly trends and where appropriate, conducting further enquiries and testing. Based on the above procedure performed, the recognition and measurement of revenue from sale of goods are considered to be adequate and reasonable.

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

The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis, Director''s Report including Annexures to Director''s Report, Corporate Governance and Shareholder''s Information, but does not include the consolidated financial statements, standalone financial statements and our auditor''s report thereon. These reports are 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 identified above when it becomes available and we do not and will 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.

When we read the other information, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance and take appropriate action, if required.

Management''s Responsibilities for the Standalone Financial Statements

The Company''s Management and 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, changes in equity and cash flows 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 statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

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

The Board of Directors 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 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 system in place and the operating effectiveness of such controls.

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

Report on Other Legal and Regulatory Requirements

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

2) A. 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 standalone Balance Sheet, the Statement of Profit and Loss (including Other Comprehensive Income), 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 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 2024 taken on

record by the Board of Directors, none of the directors is disqualified as on 31 March 2024 from being appointed as a director in terms of Section 164(2) of the Act.

f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure B". Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company''s internal financial controls over financial reporting.

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

b) The Management has represented, that, to the best of its knowledge and belief, no funds (which are material either individually or in the aggregate) have been received by the Company from any person or entity, including foreign entity ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entities

identified in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Beneficiaries") or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;

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

v. The company 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 an accounting software for maintaining its books of account which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software. Further, during the course of our audit we did not come across any instance of the audit trail feature being tampered with.

C. 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,

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.

For TATTVAM & Co.

Chartered Accountants Firm''s Registration No. 015048N

Sd/-

Gaurav Saraf

Partner

Membership No.535309 UDIN: 24535309BKHJQP8406

Place: New Delhi Date: 18 May 2024

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Mar 31, 2023

We have audited the accompanying standalone financial statements of JHS SVENDGAARD LABORATORIES LIMITED (the ''Company''), which comprise the Balance Sheet as at 31 March 2023, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year ended on that date 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 31 March 2023 and its profit, total comprehensive income, changes in equity and its cash flows 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 fSA''s) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditor''s Responsibilities for the Audit of the Standalone Financial Statements section of our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India ("ICAO 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.

#	Key Audit Matter	Auditor''s Response
1	Revenue recognition Revenue from the sale of goods (hereinafter referred to as "Revenue"! is recognized when the company performs its obligation to its Customers and the amount of revenue can be measured reliably and recovery of the consideration is probable. The timing of such recognition in the case of sale of goods is when the control over the same is transferred to the customer, which is mainly upon delivery. The timing of revenue recognition is relevant to the reported performance of the Company. The management considers revenue as a key measure for evaluation of performance Refer Note 2 to the Standalone Financial Statements - Significant accounting policies.	Principal audit procedures Our audit approach was a combination of test of internal controls and substantive procedures including: • Assessing the appropriateness of the Company''s revenue recognition accounting policies m line with Ind AS 115 (''Revenue from Contracts with Customers ) and testing thereof • Evaluating the design and implementation of Company''s controls in respect of revenue recognition. • Testing the effectiveness of such controls over revenue cut off at year-end. • We performed substantive testing by selecting samples of revenue transactions recorded during the year by verifying the underlying documents, which included goods dispatch notes and shipping documents. • Performing analytical procedures on current year revenue based on monthly trends and where appropriate, conducting further enquiries and testing Based on the above procedure performed, the recognition and measurement of revenue from sale of goods are considered to be adequate and reasonable

INFORMATION OTHER THAN THE FINANCIAL STATEMENTS AND AUDITOR''S REPORT THEREON

The Company''s Board of Directors is responsible for the other information. The other information comprises the information included in the Management Discussion and Analysis, Board''s Report including Annexures to Board''s Report, Business Responsibility Report, Corporate Governance and Shareholder''s Information, but does not include the 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 otherinformation and, in doing so, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Management''s Responsibilities 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, changes in equity and cash flows 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 statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the standalone financial statements, management is responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going

concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Board of Directors 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 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 system in place and the operating effectiveness of such controls.

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

Report on Other Legal and Regulatory Requirements

1) As required by the Companies (Auditor''s Report) Order, 2020 ("the order’), issued by the central government of India in terms of sub-section (11) of section 143 of the act, we give in the "Annexure A’ a statement on the matters specified in paragraphs 3 and 4 of the order, to the extent applicable.

2) 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, 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 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 2023 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2023 from being appointed as a director in terms of Section 164(2) of the Act.

f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure B". Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Company''s internal financial controls over financial reporting.

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.

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

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

iv.

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

b) The Management has represented, that, to the best of its knowledge and belief, no funds (which are

material either individually or in the aggregate) have been received by the Company from any person or entity, including foreign entity ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party ("Ultimate Beneficiaries'') or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries:

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

v. The company has not declared or paid any dividend during the year and has not proposed final dividend for the year.

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 with effect from 01 April 2023, and accordingly, reporting under Rule 11(g) of Companies (Audit and Auditors) Rules, 2014 is not applicable for the financial year ended 31 March 2023.

For TATTVAM & Co.

Chartered Accountants Firm’s Registration No. 015048N

Sd/-Gaurav Saraf

Partner

Membership No.535309 UDIN: 23535309BGZBAU3429

Place New Delhi Date: 30 May 2023

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Mar 31, 2018

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Indian Accounting Standards (Ind AS) financial statements of JHS Svendgaard Laboratories Limited (“the Company"), which comprise the Balance Sheet as at March 31, 2018, 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 the significant accounting policies and other explanatory information.

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 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 the 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.

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

Basis for Qualified opinion

As mentioned in Note No. 35 to the standalone Ind AS financial statements, the Company has recognized net income amounting to Rs.2727.21 lacs during the year ended 31 March 2018 on account of compensation received pursuant to the Settlement Agreement dated 28 March 2017, instead of recognizing the same in the year ended 31 March 2017. This constitutes a material departure from the Indian Accounting Standards(Ind AS) referred to in Section 133 of the Companies Act, 2013. Consequently, the exceptional income for the year ended 31 March 2018 is overstated and for the year ended 31 March 2017 is understated by Rs 2727.21 lacs. Had the Company followed the correct accounting, the net profit after tax for the year ended 31 March 2018 would have been reduced by Rs 1883.56 lacs and increased by the same amount for the year ended 31 March 2017, the carrying amount of other current assets as at the previous year ended 31 March 2017 would have increased by Rs 2475 lacs, deferred tax assets (net) as at the previous year ended 31 March 2017 would have been reduced by Rs 843.65 lacs as at the previous year ended 31 March 2017 and other equity would have increased by Rs 1883.56 lacs as at the previous year ended 31 March 2017. This was a matter of qualification in the previous year as well.

Qualified Opinion

In our opinion and to the best of our information and according to the explanations given to us except for the effects of the matter described in the Basis for Qualified Opinion paragraph, 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 including the Ind AS, of the state of affairs of the Company as at March 31,2018, and its profits (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 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, based on our audit we report, to the extent applicable that:

a) We have sought and except for the effects of the matter described in the Basis for Qualified Opinion paragraph, obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit.

b) Except for the effects of the matter described in the Basis for Qualified Opinion paragraph, 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 Ind AS Financial Statements dealt with by this Report are in agreement with the books of account;

d) Except for the effects of the matter described in the Basis for Qualified Opinion paragraph, in our opinion, the 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 March 31, 2018, taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 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 over financial reporting 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 standalone financial position in its Ind AS financial statements- Refer Note 37 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.

Annexure "A" to the Independent Auditor''s Report

(Referred to in paragraph 1 under ''Report on Other Legal and Regulatory Requirements'' section of the Independent Auditor''s Report of even date to the members of JHS Svendgaard Laboratories Limited on the standalone Ind AS financial statements as of and for the year ended March 31, 2018)

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

b) The fixed assets comprising of (property, plant and equipment and other intangible assets) are physically verified by the management according to a phased programme designed to cover all 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 fixed assets has been physically verified by the management during the year and no material discrepancies have been noticed on such verification.

c) According to the information and explanations given to us and the records examined by us and based on the examination of the title deeds provided to us, we report that, the title deeds of all the freehold immovable properties (which are included under the head ''Property, Plant and Equipment) are held in the name of the Company.

(ii) The management has conducted physical verification of inventory at reasonable intervals during the year, except for stocks lying with a third party. For stocks lying with a third party at the year-end, written confirmations have been obtained by the management. According to the information and explanations given to us, no material discrepancies were noticed on the aforesaid verification.

(iii) According to the information and explanations given to us, the Company has granted interest free unsecured loans, to companies covered in the register maintained under Section 189 of the Companies Act, 2013, in respect of such loans;

a) in our opinion the terms and conditions of grant of such loans are not, prima facie, prejudicial to the company''s interest.

b) no repayment schedule has been specified and accordingly the question of regularity in repayment of principal amount does not arise. Further, as stated above these loans are interest free and repayment of interest does not arise.

c) in the absence of stipulated schedule of repayment of principal, we are unable to comment as to whether there is any amount which is overdue for more than 90 days and whether reasonable steps have been taken by the Company for recovery of the amount.

(iv) In our opinion and according to the information and explanations given to us the Company has complied with the provisions of Sections 185 and 186 of the Act in respect of loans, investments, guarantees, and security.

(v) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits during the year and had no unclaimed deposits at the beginning of the year 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) According to the information and explanations given to us, the Central Government has not specified maintenance of cost records under sub-section (1) of Section 148 of the Act, in respect of Company''s products/ services. Accordingly, the provisions of clause 3(vi) of the Order are not applicable.

(vii) a) According to the information and explanations given to us, undisputed statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax, cess, goods and service tax and other material statutory dues, as applicable, have generally been regularly deposited to the appropriate authorities, though there has been a slight delay in a few cases. Further, no undisputed amounts payable in respect thereof were outstanding at the year-end for a period of more than six months from the date they became payable.

b) According to the information and explanations given to us, there are no dues in respect of income-tax, sales-tax, service tax, duty of customs, duty of excise, value added tax and goods and service tax that have not been deposited with the appropriate authorities on account of any dispute.

(viii) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of loans to banks and financial institution. The Company does not have any loans or borrowings from any government or debenture holders during the year.

(ix) In our opinion and according to the information and explanations given to us, the Company did not raise moneys by way of initial public offer or further public offer (including debt instruments) and did not have any term loans outstanding during the year. Accordingly, the provisions of clause 3(ix) of the Order are not applicable.

(x) To the best of our knowledge and according to the information and explanations given to us, no fraud by the Company or on the Company by its officers or employees has been noticed or reported during the period covered by our audit.

(xi) In our opinion and according to the information and explanations given to us, managerial remuneration has been provided by the Company in accordance with the requisite approvals mandated by the provisions of Section 197 of the Act read with Schedule V to the Act.

(xii) In our opinion, the Company is not a Nidhi Company. Accordingly, provisions of clause 3(xii) of the Order are not applicable.

(xiii) In our opinion and according to the information and explanations given to us, all transactions with the related parties are in compliance with Sections 177 and 188 of Act, where applicable, and the requisite details have been disclosed in the financial statements, as required by the applicable accounting standards.

(xiv) According to the information and explanations given to us, during the year, the Company has made preferential allotment of shares. In respect of the same, in our opinion, the Company has complied with the requirement of Section 42 of the Act and the Rules framed there under. Further, in our opinion, the amounts so raised have been used for the purposes for which the funds were raised. During the year, the Company did not make private placement of shares/ fully/partly convertible debentures.

(xv) In our opinion and according to the information and explanations given to us, the Company has not entered into any non-cash transactions with the directors or persons. Accordingly, provisions of clause 3 (xv) of the Order are not applicable.

(xvi) The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, provisions of clause 3 (xvi) of the Order are not applicable.

Annexure"B"

Independent Auditor''s report on the Internal Financial Controls under Clause (i) of Subsection 3 of Section 143 of the Companies Act, 2013 ("the Act")

1. We have audited the internal financial controls over financial reporting of JHS Svendgaard Laboratories Limited (“the Company") as of March 31, 2018 in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.

Management''s Responsibility for Internal Financial Controls

2. The Company''s management is responsible for establishing and maintaining internal financial controls based on Internal financial controls over financial reporting 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. 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 the company''s 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 Act.

Auditors'' Responsibility

3. Our responsibility is to express an opinion on the Company''s Internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal financial controls over financial reporting (the “Guidance Note") and the Standards on Auditing, issued by the Institute of Chartered Accountants of India (ICAI) and deemed to be prescribed under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the ICAI. 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 over financial reporting were established and maintained and if such controls operated effectively in all material respects.

4. Our audit involves performing procedures to obtain audit evidence about the adequacy of the Internal financial controls over financial reporting and their operating effectiveness. Our audit of Internal financial controls over financial reporting included obtaining an understanding of Internal financial controls over financial reporting, 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 judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

5. 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 over financial reporting.

Meaning of Internal Financial Controls over Financial Reporting

6. A company''s Internal financial controls over financial reporting 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 over financial reporting includes 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 authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised 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 over Financial Reporting

7. Because of the inherent limitations of Internal financial controls over financial reporting, 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 over financial reporting to future periods are subject to the risk that Internal financial controls over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

8. In our opinion, the Company has, in all material respects, adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2018, based on Internal financial controls over financial reporting 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.

For S.N. Dhawan & Co LLP

Chartered Accountants

Firm''s Registration No.:000050N/N500045

S. K. Khattar

Place: New Delhi Partner

Date: 15 May 2018 Membership No.: 084993

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Mar 31, 2016

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements of JHS Svendgaard Laboratories Limited (the "Company"), which comprise the Balance Sheet as at March 31, 2016, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management''s Responsibility for the Standalone Financial Statements

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

Auditor''s Responsibility

Our responsibility is to express an opinion on these standalone financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of 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 the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2016, and its loss 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 the Annexure "A" a statement on the matters specified in paragraphs 3 and 4 of the Order.

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

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the 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 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 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 financial statements - Refer Note 31(1) (c) 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 and;

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

Referred to in paragraph 1 of the Independent Auditor''s Report of even date to the members of JHS Svendgaard Laboratories Limited on the standalone financial statements as of and for the year ended March 31, 2016.

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

(b) According to the information and explanations given to us physical verification of fixed assets is being conducted in a phased manner by the management under a programme designed to cover all the fixed assets 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. Discrepancies noticed on such verification were not material and have been properly dealt with in the books of account.

(c) 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 are held in the name of the Company.

(ii) According to the information and explanations given to us the inventories have been physically verified by the management at reasonable intervals during the year. The discrepancies noticed on physical verification of inventories as compared to book records were not material and the same have been properly dealt with in the books of account.

(iii) According to the information and explanations given to us and based on our examination of the documents and records the Company has granted interest free unsecured loans, to companies covered in the register maintained under Section 189 of the Companies Act, 2013, in respect of such loans;

a) Terms and conditions of loans so granted are not, prima facie, prejudicial to the interest of the Company.

b) According to the information and explanations given to us, no repayment schedule has been specified and accordingly the question of regularity in repayment of principal amount does not arise. Further, as stated above these loan are interest free and repayment of interest does not arise.

c) As stated above no repayment schedule have been specified, therefore there are no amount which is overdue for more than 90 days.

(iv) In our opinion and according to information and explanations given to us, the Company has, in respect of loans, investments, guarantees, and security, complied with the provisions of section 185 and 186 of the Act.

(v) According to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of Sections 73 to 76 or any other relevant provisions of the Act and the rules framed there under.

(vi) In our opinion and according to the information and explanations given to us, the Central Government has not prescribed the maintenance of cost records under section 148 (1) of the Companies Act, 2013 for any of its products manufactured by the Company.

(vii) (a) According to the information and explanations given to us and the records of the Company examined by us, the Company is generally regular in depositing undisputed statutory dues including provident fund, employees'' state insurance, income-tax, sales-tax, service tax, value added tax, cess and any other statutory dues to the appropriate authorities and no undisputed amounts payable in respect of outstanding statutory dues were in arrears as at March 31, 2016 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no dues of income-tax, sales-tax, service tax, value added tax which have not been deposited on account of any dispute.

(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 a financial institution, banks, and government. The Company has not issued any debentures during the year.

(ix) In our opinion and according to the information and explanations given to us, the Company has not raised any moneys by way of initial public offer or further public offer (including debt instruments). The term loans raised were applied for the purposes for which they have been raised.

(x) Based on our audit procedures and as per the information and explanations given by the management, we report that no fraud by the Company or on the Company, by its officers or employees, has been noticed or reported during the year.

(xi) According to the information and explanations given to us and based on our examination of the books of account and other records of the Company, the managerial remuneration has been paid or provided in accordance with the requisite approvals mandated by the provisions of section 197 read with the schedule V to the Act.

(xii) According to the information and explanations given to us, the Company is not a Nidhi Company. Therefore, the provisions of Clause 3(xii) of the Order are not applicable to the Company.

(xiii) Based on our audit procedures and as per the information and explanations provided by the management, in our opinion, the Company has entered into transactions with related parties in compliance with the provisions of section 177 and 188 of the Act, where applicable and the details of such transactions have been disclosed in the notes to the financial statements as required by the applicable accounting standards.

(xiv) According to the information and explanations give to us and based on our examination of the records, the Company has made preferential allotment of shares during the year under review, which is in compliance with the requirement of section 42 of the Companies Act, 2013 and the amount raised have been used for the purposes for which the funds were raised. The Company has not made any preferential allotment or private placement of fully or partly convertible debentures during the year.

(xv) According to the information and explanations given to us and based on our examination of the records, the Company has not entered into non-cash transactions with directors or persons connected with him. Therefore, the provisions of clause 3(xv) of the Order are not applicable to the Company.

(xvi) The Company is not required to be registered under section 45-IA of Reserve Bank of India Act, 1934. Therefore, the provisions of clause 3(xvi) of the Order are not applicable to the Company.

For S. N. Dhawan & Co.

Chartered Accountants

Firm''s Registration No. 000050N

S. K. Khattar

Partner

M. No. 084993

Place: New Delhi

Date: May 26, 2016

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Mar 31, 2015

We have audited the accompanying Standalone Financial Statements of JHS Svendgaard Laboratories Limited(the "Company"), which comprise the Balance Sheet as at March 31, 2015, the Statement of Profit and Loss,the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information.

Management's Responsibility for the Standalone Financial Statements

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

Auditor's Responsibility

Our responsibility is to express an opinion on these standalone financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit in accordance with the Standards on Auditing specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of 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 operating effectiveness of such controls.An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

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

Basis for Qualified Opinion

i) The Company has entered into "One Time Settlement" (OTS) of dues with its lender banks.As a result, the lenders have agreed to waive the principal amount on term loan facilities amounting to Rs. 30,82,89,217and such amount is credited to Capital Reserve which is not in accordance with the Accounting Standard (AS) 5 on "Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies".Further, the said treatment is not in line with the opinion of the Expert Advisory Committee of the Institute of Chartered Accountants of India on accounting treatment of waiver of loan.

Had the said waiver of principal amount of loan been credited to the Statement of Profit and Loss instead of the credit in Capital Reserve Account, the loss for the year amounting to Rs. 22,13,91,633 would result in profit of Rs.8,68,97,584 and deficit in the Statement of Profit & Loss under the head 'Reserves & Surplus' would have been Rs.7,45,88,944 instead of Rs. 38,28,78,160 as stated.

ii) In earlier years the Company had acquired substantial tangible fixed assets to carry out contract manufacturing for a major customer. Such major customer has not renewed/terminated the contract resulting in some idle fixed assets. This and other internal factors indicate that the part of tangible fixed assets comprising plant & machinery which are carried in the books at a written down value of Rs 31,86,11,888 (Previous year Rs. 35,43,87,177) may be impaired. However, the management has not carried out any testing for impairment as required by Accounting Standard (AS) 28 "Impairment of Assets".Therefore, we are unable to comment on the necessity or otherwise to provide for an impairment loss in respect of these tangible assets as required by AS 28. The effect of the non provision of impairment loss on assets, if any, cannot be quantified.

Qualified Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effect of the matter described in para (i) above and the possible effect of the matter described in para (ii) of theBasis for Qualified Opinion paragraph the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2015, and its loss and its cash flows for the year ended on that date.

Emphasis of Matters

We draw attention to the following notes on the financial statements:

i) In the financial year 2012-13, as per the management's decision, the Company had written off its unrealizable trade receivables amounting Rs. 48,28,92,640 which were set-off against Securities Premium Account directly. This was subject to approval of the Hon'ble High Court of Himachal Pradesh for ratifying the said adjustment. The management has decided to withdraw the said application from the Hon'ble High Court. Accordingly, during the year the Company has reversed the treatment given in the earlier year for write off amounting to Rs. 48,28,92,640 by crediting Securities Premium Account and charged the same to the Statement of Profit and Loss as on March 31, 2015.

ii) The management has explained the basis for recording provisions in respect of certain loans & advances which are doubtful of recovery. (Refer note 29(iv))

iii) The management has explained the basis for write-back of long outstanding payables. (Refer note 29(vi)& note 36 (ii))

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, to the extent applicable.

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

(a) We have sought and, except for matter described in the Basis for Qualified Opinion paragraph (ii) above,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) Except for the possible effects of the matters described in the Basis for Qualified Opinion paragraph,in our opinion, the Balance Sheet, Statement of Profit and Loss and Cash Flow Statement comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;

(e) The matters described in the Basis for Qualified Opinion paragraph above, in our opinion, may have an adverse effect on the functioning of the Company;

(f) On the basis of 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;

(g) The qualification relating to the maintenance of accounts and other matters connected therewith are as stated in Basis for Qualified Opinion paragraph above.

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

(i) The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 31(I) (c) 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 and;

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

Annexure to the Independent Auditor's Report

Referred to in paragraph 1of the Independent Auditor's Report of even date to the members of JHS Svendgaard Laboratories Limited on the financial statements for the year ended March 31, 2015.

(i) In respect of Fixed Assets

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

(b) The fixed assets are physically verified by the management according to a phased programme designed to cover all 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 fixed assets has been physically verified by the management during the year and no material discrepancies have been noticed on such verification.

(ii) In respect of Inventories

(a) The management has conducted physical verification of inventory at reasonable intervals during the year. In our opinion, the frequency of verification is reasonable

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

(c) The Company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification carried out at the end of the year.

(iii) According to the information and explanations given to us, the Company has granted interest free unsecured loans, to companies, firms or other parties covered in the register maintained under Section 189 of the Companies Act, 2013, in respect of such loans;

i) According to the information and explanations given to us, no repayment schedule has been specified and accordingly the question of regularity in repayment of principal amount wherever applicable does not arise. Further, as stated above these loan are interest free and repayment of interest does not arise.

iii) As stated above no repayment schedule have been specified and there are no overdue amounts in excess of Rs. one lacs.

iv) In our opinion and according to the information and explanations given to us, there exists an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of fixed assets and sale of goods and services.

In our opinion and according to the information and explanations given to us, the internal control system with regard to purchase of inventory needs to be strengthened to commensurate with the size of the Company and the nature of its business. During the course of our audit, we have not observed any continuing failure to correct material weaknesses in the internal control system of the Company.

v) The Company has not accepted any deposit from public within the meaning of sections 73 to 76 of the Companies Act 2013and rules framed there under.

vi) In our opinion and according to the information and explanations given to us, the Central Government has not prescribed the maintenance of cost records under section 148 (1) of the Companies Act, 2013 for any of the products of the Company.

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 accounts in respect of undisputed statutory dues including provident fund, employees' state insurance, income-tax, sales-tax, wealth-tax, service tax, duty of custom, duty of excise, value added tax, cess and other material statutory dues generally have been 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 above were in arrears, as at March 31, 2015, for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no dues of income-tax, sales-tax, wealth- tax, service tax, duty of custom, duty of excise, value added tax or cess which have not been deposited on account of any dispute.

(c) As per the records of the Company and according to information and explanations given to us, no amount is required to be transferred to Investor Education and Protection Fund (IEPF) in accordance with the relevant provisions of the Companies Act, 1956 (1 of 1956) and rules made thereunder.

viii) The accumulated losses of the Company at the year end are not more than fifty percent of its net worth. Further, the Company has incurred cash losses during the financial year and in the immediately preceding financial year. The effect of qualifications described in the Basis of Opinion paragraph in our Audit Report has not been given in the Standalone Financial Statements.

ix) In our opinion and according to the information and explanations given to us,the Company has defaulted in repayment of dues to financialinstitutions and banks. However, in the month of March 2015, the Company had entered into One Time Settlement (OTS) with its lender banks to clear all the outstanding loans & interest thereon. Accordingly,as on date,the Company has paid all the dues towards OTS.

There were no dues to debenture holders.

x) In our opinion, and according to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions during the year. Accordingly, the provisions of Clause 3(x) of the Order are not applicable to the Company.

xi) According to the information and explanations given to us, no term loans have been obtained during the year. Accordingly, the provisions of Clause 3(xi) of the Order are not applicable to the Company.

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

For S. N. Dhawan & Co. Chartered Accountants Firm'sRegistration No. 000050N

S.K.Khattar Partner M. No. 084993

Place: New Delhi Date: July 14, 2015

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Mar 31, 2014

We have audited the accompanying financial statements of JHS Svendgaard Laboratories 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 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.

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

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

Basis for Qualified Opinion

(a) Going Concern

The accompanying financial statements for the year ended March 31, 2014 has been prepared assuming that the Company will continue as a going concern. However, the Company has been incurring operating and cash losses, has defaulted in repayment of laons and interest due to banks, there have been delays in payment of statutory dues, salaries to employees and payment to vendors and has negative working capital. Further, there has been termination of contract by a major customer of the Company resulting in idel fixed assets. Such factors create substantial double about the ability of the Company to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of such uncertainty.

(b) Impairement of Assets-AS 28

During earlier years, the Company had acquired substantial tangile fixed assets to carry out contract manufacturing for a major customer. Such major customer has terminated the contract resulting in some idle fixed assets. This and other interinal factors indicate that the part of tangible fixed assets comprising plant & machinery which are being carried in the books at a written down value of ''354,387,177 (Previous year ''388,169,870) may be impaired. However, the management has not carried out any testing for impairement as required by Accounting Standard 28. Accordingly we are unable to comment on the necessity or otherwise to provide for an impairement loss in respect of these tangible assets as required by Accounting Standard 28. The effect of the non-provision of the impairment loss on assets, if any, cannot be quantified.

(c) Confirmations

The confirmations from the some of the legal counsels engaged by the Company in connection with matters related to indirect tax and other matters including cases filed against the Company were not available for our verification. Accordingly, we are unable to comment on outcome of such matters and the consequential impact, if any, on the reported

amounts of contingent liabilities and necessity of any provision required to be recorded.

Trade payables balance amounting to ''23,978,283 due to nine parties are subject to confirmation and reconciliation, if any, and accordingly we were unable to confirm or verify by alternative means such trade payables included in the Balance Sheet as at March 31, 2014. Qualified Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effects fo the matter discribed in the Basis for Qualified Opinion paragrah, 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 31,2014;

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.

Emphasis of Matter

1. we draw attention to Note 40 of the finacial statements, wherein the management believes that in view of the profile of its vendors, there are no dues whatsoever to parties covered under the Micro Small Medium Enterprise Development Act, 2006.

2. We draw attention to Note 29(a) of the financial statements, wherein the management has explained the basis for recording provision for doubtful debts in respect of certain trade receivables.

3. We draw attention to Note 29(b) of the financial statements, wherein the management has explained the basis for recording provision for doubtful advances in respect of certain loans & advances and recoverability or other long outstanding advances.

4. We draw attention to Note 29(c) of the financial statements, wherein the management has explained the basis for write-back of certain liabilities and provisions.

Report on Other Legal and Regulatory Requirements:-

[1] As required by the Companies (Auditors'' 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 except for the matter described in the Basis for Qualified opinion paragraph;

(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) except for the possible effect of the matter described in the Basis for Qualified Opinion paragraph, 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;

(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 Act.

ANNEXURE TO INDEPENDENT AUDITORS'' REPORT

[Referred to in paragraph 1 under ''Report on other Legal and Regulatory Requirements'' in the Independent Auditors'' Report of even date to the members of JHS Svendgaard Laboratories Limited on the financial statements for the year ended March 31,2014]

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

(b) The fixed assets are physically verified by the management according to phased program designed to cover all the items over a period of 3 years, which in our opinion is reasonable having regard to the size of the Company and nature of its assets. Pursuant to the programme, a portion of the fixed assets 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, a substantial part of fixed assets has not been disposed of by the Company during the year.

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

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

(c) The Company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification carried out at the end of the year.

(iii) (a) The Company has granted interest free unsecured loans to three parties covered under section 301 of the Act. The maximum amount outstanding during the year and the year end balance of such loans are as follows:

(Amount in Rs.

Name of the Maximum balance Year end Party outstanding during balance the year

JHS Svendgaard Dental 403,445 403,445 Care Limited

JHS Svendgaard Mechanical 129,581,453 129,581,453 and Warehouse Private Limited

Number One Real Estate 18,174,541 16,784,158 Private Limited

(b) In our opinion and according to the information and explanation given to us, the rate of interest and others terms and conditions for loans granted to Number One Real Estate Private Limited and JHS Svendgaard Dental Care Limited (fully provided for in books of Company) are prejudicial to the interest of the Company. The rate of interest and other terms and conditions of loans granted to JHS Svendgaard Mechanical and Warehouse Private Limited and are prima facie not prejudicial to the interest of the Company.

(c) In our opinion and according to the information and explanation given to us, In respect of the interest free loan granted to JHS Svendgaard Dental Care Limited and Number One Real Estate Private Limited, the terms of repayment of principal are not stipulated. According, we are unable to comment on regularity of the same. The interest free loan granted to JHS Svendgaard Mechanical and Warehouse Private Limited is not yet due for receipt as per the terms of agreement.

(d) In the absence of repayment schedule for JHS Svendgaard Dental Care Limited and Number One Real Estate Private Limited, we are unable to comment on whether the amount is overdue as at the Balance Sheet date. In case of loan granted to JHS Svendgaard Mechanical and Warehouse Private Limited no amount is overdue on the Balance Sheet date.

(e) The Company has taken loan from three parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount outstanding during the year and the year end balance of such loans are as follows:

(Amount in Rs. Name of the Maximum balance Year end Party outstanding during balance the year

Nikhil Nanda 149,443,525 138,183,525

Sushima Nanda 1,284,323 1,234,333

Apogee Manufacturing 49,109,270 Private Limited

(f) In our opinion, the rate of interest and other terms and conditions for loan taken from Nikhil Nanda are not, prima facie, prejudicial to the interest of the Company. In the absence of any agreement with other two parties, we are unable to comment whether the rate of interest and other terms and conditions for such loans are prima facie, prejudicial to the interest of the Company.

(g) In our opinion, loan taken from Nikhil Nanda is interest free and as explained, repayment of loan has not been demanded. In the absence of any agreement with the other two parties, we are unable to comment on the regularity of repayment of principal amounts and interest thereon.

(iv) In our opinion and according to the information and explanations given to us, there exists an adequate internal control system commensurate with the size of the Company and the nature of its business with regards to purchase fixed assets and with regard to the sale of goods and services.

In our opinion and according to the information and explanations given to us, the internal control system with regard to purchase of inventory needs to be strengthened to be commensurate with the size of the Company and the nature of its business.

During the course of our audit, we have not observed continuing failure to correct material weakness in the internal control system of the company.

(v) (a) According to the information and explanations given to us, 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 register maintained under section 301 have been so entered.

(b) We are unable to comment if the transactions made with the parties listed in section 301 of the Act, 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 as the prices are not comparable since similar transactions have not been undertaken with any other party not covered under section 301.

Unsecured loans taken from and granted to parties have been dealt with in paragraph (iii) (a) (iii) (g) above.

(vi) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of sections 58Aand 58AAof the Act and the rules framed there under.

(vii) The system of Internal audit of the Company needs to be strengthened and commensurate to the size and nature of its business.

(viii) We have broadly reviewed the books ot account relating to the manufacture of Toothpastes, mouthwash and room fresheners pursuant to the Rules made by the Central Government of India, for the maintenance of cost records under clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956 and we are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have, however, not made a detailed examination of records with a view to determining whether they are accurate or complete. To the best of our knowledge and according to the information and explanations given to us, the Central government has not prescribed maintenance of cost records for any other products of the Company.

(ix) (a) Undisputed statutory dues including provident fund, employees'' state insurance and tax deducted at source have not been regularly deposited with the appropriate authorities and there have been serious delays in large number of cases. The Company is regular in depositing with appripriate authorities undisputed statutory dues including income tax, wealth tax, sales tax and excise duty.

As explained, there is no amount due for deposit with investor Education and Protection Fund.

According to the information and explanations given to us, custom duty is presently not applicable to the Company.

According to the information and explanations given to us, no undisputed amounts payable in respect of income-tax, wealth- tax, sales-tax, excise duty, tax deducted at source, service tax, tax collected at source, 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.

According to the information and explanations given to us, undisputed amounts payable in respect of provident fund, employees'' state insurance which were outstanding, at the year end for a period of more than six months from the date they became payable are as follows:

Name of the Nature of Amount in Period to Due Date Date of Payment statue the dues (Rs.) which the amount relates Employees Provident 268,530 September October May 19, 2014 Provident Fund Fund 2013 2013 and Miscellaneous (including and May 27, Provisions Act, 5 days of 2014 1952 grace per iod)

Employee State Employees''14,935 April-Sep 21st of May 19,2014 Insurance State tember the follo and May 27, Act, 1948 Insurance 2013 wing month 2014

As explained, there is no amount due for deposit with Investor Education and Protection Fund.

According to the information and explanations given to us, custom duty is presently not applicable to the company.

(b) According to the information and explanations given to us, there are not dues of income tax, sales tax, wealth tax, service tax, excise duty and cess on account of any dispute which have not been deposited with appropriate authorities.

(x) The accumulated losses of the Company at the year end are not more than fifty percent of its net worth. Further, the Company has incurred cash losses during the financial year, however, it has not incurred cash losses in the immediately preceding financial year. The effect of qualifications described in the Basis of Opinion paragraph in our Audit Report are currently unascertainable and accordingly cash losses have not been adjusted for consequential effect resulting from such qualifications.

(xi) In our opinion and according to the information and explanations given to us, the Company has defaulted in repayment of dues to financial institutions and banks. Details of such defaults are reported as under. There were no dues to debenture holders.

Name of the Bank Type of facility Principal Interest Period Date of Due Due of rectifying (Amount (Amount default the deefault in '') in '')

ICICI and Bank Foreign currenty 481,367, 155,650, Various Still of India loan from 332 408 dates in continuing banks External FY 2012 Commercial -13 and Borrowings (ECB) FY 2013- 14

(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 beneift fund/society. Accordingly, the provisions of clause 4(xiii) of the Order 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 Order are not applicable to the Company.

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

(xvi) In our opinion, the term loans have been applied for the purpose for which the loans were raised.

(xvii) According to the information and explanations given to us and on an overall examination of the belance sheet of the Company, we report that the Company has applied funds raised on short term basis for long term investment amounting to ''507,652,838.

(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 Act during the year.

(xix) According to the information and explanations given to us, no debentures have been issued by the Company during the year.

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

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

For Haribhakti & Co. Chartered Accountants Firm Registration No.103523W

Raj Kumar Agarwal Partner Membership No. 074715

Place: New Delhi Date: 30th May, 2014

---

Mar 31, 2013

Report on the Financial Statements.

We have audited the accompanying financial statements of JHS Svendgaard Laboratories 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 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.

Auditors'' 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 auditors'' 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 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.

Emphasis of Matter

Without qualifying our opinion:-

[1] Attention is invited to note number 4.2 and 17 of financial statements in respect of management''s decision to write off unrealisable trade receivables amounting 482,892,640 by utilising securities premium account. In this regard the Company has applied to Hon''ble High Court of Himachal Pradesh for an approval which is pending to be received till the date of this report.

[2] Attention is invited to note number 48 of financial statements with regard to non renewal of contract by a major customer. The Management does not expect significant impact of this on operations of the Company.

Report on Other Legal and Regulatory Requirements:-

[1] As required by the Companies (Auditors'' 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 except for the matter described in the Basis for disclaimer of opinion paragraph;

(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 subsection (3C) of section 211 of the Companies Act, 1956;

(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 Companies Act, 1956.

[Referred to in paragraph 1 of Report on other legal and regulatory requirements of the Auditors'' Report of even date to the members of JHS Svendgaard Laboratories Limited on the financial statements for the year ended March 31, 2013]

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

(b) As explained to us, all the fixed assets have been physically verified by the management in a phased periodical manner over a period of three years, 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 physical verification.

(c) In our opinion and according to the information and explanations given to us, a substantial part of fixed assets has not been disposed off by the Company during the year.

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

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

(c) The Company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification carried out at the end of the year.

(iii)(a) The Company has granted interest free unsecured loans to three parties covered under section 301 of the Act. The maximum amount involved during the year is Rs. 128,447,979 and the balance at the year end isRs. 128,447,979. Related parties areas under: -Jones H Smith, FZE- Wholly owned subsidiary Rs.(1,505,722); -JHS Svendgaard Dental Care Limited- Subsidiary (349,050); and -JHS Svendgaard Mechanical and Warehouse Private Limited -subsidiary w.e.f. June 21, 2012 Rs.(126,593,207).

(b) In our opinion and according to the information and explanation given to us, loan granted to first two subsidiaries referred above, are fully provided for in books of Company and therefore, the rate of interest and others terms and conditions thereof are prejudicial to the interest of the Company The rate of interest and others terms and conditions of loan granted to JHS Svendgaard Mechanical and Warehouse Private Limited are prima facie not prejudicial to the interest of the Company.

(c) In our opinion and according to the information and explanation given to us, In respect of the interest free loan granted to first two subsidiaries referred above, the terms of principal repayment are not stipulated. Hence, we are unable to comment on principal repayment regularity of the same. The interest free loan granted to JHS Svendgaard Mechanical and Warehouse Private Limited is not yet due for receipt as per the terms of agreement.

(d) In the absence of repayment schedule for the first two subsidiaries referred above, we are unable to comment on whether the amount is overdue as at the Balance Sheet date. In case of loan granted to JHS Svendgaard Mechanical and Warehouse Private Limited no amount is overdue on the Balance Sheet date.

(e) The Company has taken loan from two parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year is Rs.289,887,550 and the balance as at year end is Rs. 198,552,795.

(f) In the absence of any agreement with the above said parties, we are unable to comment on whether the rate of interest and other terms and conditions for such loans are prima facie, prejudicial to the interest of the Company.

(g) In the absence of any agreement with the above said parties, we are unable to comment on the regularity of repayment of principal amounts and interest thereon.

(iv)In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business with regards to purchase of inventories, fixed assets and sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weakness in the internal control system of the company.

(v) (a) According to the information and explanations given to us, 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) The transactions referred in this clause were entered by one of the amalgamated company and form the part of company pursuant to amalgamation. We are unable to comment if the transactions made with the parties listed in section 301 of the Companies Act, 1956, in pursuance of such contracts or arrangements exceeding value rupees live 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, as market prices comparable to those transactions with similar terms are not available.

(vi) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of sections 58A and 58AA of the Act and the rules framed there under.

(vii)The Company has an internal audit system, the scope and coverage of which, in our opinion requires to be widened to commensurate with the size and nature of its business.

(viii)We have broadly reviewed the books of account relating to the manufacture of toothpastes, mouthwash and room fresheners pursuant to the Rules made by the Central Government of India, for the maintenance of cost records under clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956 and we are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have, however, not made a detailed examination of records with a view to determining whether they are accurate or complete. To the best of our knowledge and according to the information and explanations given to us, the Central government has not prescribed maintenance of cost records for any other products of the Company.

(ix) (a) The Company is regular in depositing with appropriate authorities undisputed statutory dues including Income tax, wealth tax, sales tax, customs duty and excise duty. undisputed statutory dues including provident fund, employees'' state insurance, tax deducted at source, Service tax and tax collected at source have generally been deposited with delays with appropriate authorities. As explained, there is no amount due for deposit with Investor Education and Protection Fund.

According to the information and explanations given to us, no undisputed amounts payable in respect of income-tax, wealth- tax, sales-tax, customs duty, excise duty, provident fund, employees'' state insurance, tax deducted at source, service tax, tax collected at source, 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.

As explained, there is no amount due for deposit with Investor Education and Protection Fund.

(b) According to the information and explanations given to us, there are no dues of income tax, sales tax, wealth tax, service tax, customs duty, excise duty and cess on account of any dispute which have not been deposited with the appropriate authorities.

(x) The Company does not have any accumulated losses at the end of the financial year and it has not incurred any cash losses in the current and immediately preceding financial year.

(xi) Based on our audit procedures and as per the information and explanations given by the management, there are no dues to debenture holders or financial institutions. However, there has been defaults in repayment of dues to the banks during the year:

Name of Bank Type of facility (Amount in Due .)

ICICI Bank Foreign currency loan from banks - 53,954,186 External Commercial Borrowings (ECB)

ICICI Bank Foreign currency loan from banks- 16,534,347 Foreign Currency Term Loan (FCTL)

ICICI Bank Indian rupee term loan from bank 37,776,000

Interest Due (Amount in Rs.) Due date 2,443,775 August 27, 2012 and February 27, 2013

886,039 July 31, 2012 and January 31, 2013

16,555,278 June 29, 2012, September 29 2012, December 29 2012, March 29, 2013

(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 another 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 Order 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 Order are not applicable to the Company.

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

(xvi)In our opinion, the term loans have been applied for the purpose for which the loans were raised.

(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 and companies covered in the register maintained under Section 301 of the Act during the year.

(xix)According to the information and explanations given to us, no debentures have been issued by the Company during the year.

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

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



For Haribhakti & Co

Chartered Accountants

Firm Registration No.103523W



Place: New Delhi Raj Kumar Aggarwal

Date: 27th May, 2013 Membership No.074715

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Mar 31, 2012

1. We have audited the attached Balance Sheet of JHS Svendgaard Laboratories 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 by the Companies (Auditor's Report) (Amendment) Order, 2004, issued by the Central Government of India in terms of sub-section (4A) of Section 227 of 'The Companies Act, 1956' of India (the 'Act') and on the basis of such checks of the books and records of the company as we considered appropriate and according to the information and explanations given to us, we give 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 paragraph 3 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. Without qualifying our opinion attention is invited to the fact that:

The company has engaged in manufacturing hygiene product i.e. Odonil, which is not specifically covered by object clause of Memorandum of Association.

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

Annexure to Auditors' Report [Referred to in paragraph 3 of the Auditors' Report of even date to the members of JHS Svendgaard Laboratories Limited on the financial statements for the year ended March 31, 2012]

(i) (a) The Company has maintained records showing quantitative details of fixed assets except for the complete particulars, identification and situation of fixed assets.

(b) The Company has a policy of physically verifying fixed assets according to a phased program to cover all the items over all 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. The fixed assets were physically verified during the current year. However, the process of physical verification needs to be strengthened to include proper instructions and reconciliation with the fixed assets register.

(c) In our opinion and according to the information and explanations given to us, a substantial part of fixed assets has not been disposed off by the company during the year.

(ii) (a) The inventory (excluding inventory with third party) has been physically verified by the management during the year. In respect of inventory lying with third party, these have substantially been confirmed by the third party. In our opinion, the frequency of verification is reasonable and adequate in relation to the size of the Company and nature of its business.

(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. However, the process of physical verification needs to be further strengthened.

(c) The Company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification carried out at the end of the year.

(iii) (a) The Company has granted unsecured loan amounting to Rs.40,030,000 to a party covered in the register maintained under section 301 of the Companies Act, 1956.

(b) In our opinion, the rate of interest and other terms and condition are not prejudicial to the interest of the Company.

(c) In respect of the above loan, the principal is not yet due for receipt as per the terms of agreement. However, since the terms of receipt of interest are not stipulated, we are unable to comment on the regularity of the same.

(d) As per the agreement with party, the above said loan is repayable after three years. Basis this, no amount is overdue at the balance sheet date.

(e) The Company has taken loan from two parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year is Rs.58,763,775 and the year-end balance of loans is Rs.9,777,614.

(f) In the absence of any agreement with the above said parties, we are unable to comment on whether the rate of interest and other terms and conditions for such loans are prima facie, prejudicial to the interest of the Company.

(g) In the absence of any agreement with the above said parties, we are unable to comment on the regularity of repayment of principal amounts and interest thereon.

(iv) In our opinion and according to the information and explanations given to us, there exists an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventory. However, the internal control system needs to be strengthened to commensurate with the size of the Company and the nature of its business with regard to purchase of fixed assets and sale of goods. During the course of our audit, we have observed continuing failure to correct weakness in respect to internal control system related to purchase of fixed assets and sale of goods.

(v) (a) In our opinion and according to the information and explanations given to us, there are no transactions made in pursuance 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. Accordingly, the provisions of clause 4(v) (a) and 4(v) (b) of the Companies (Auditor's Report) Order, 2003 (as amended) are not applicable to the Company.

(vi) In our opinion and according to the information and explanations given to us, the company has not accepted any deposits from the public within the meaning of sections 58A and 58AA of the Act and the rules framed there under.

(vii) The Company has an internal audit system, the scope and coverage of which, in our opinion requires to be widened to commensurate with the size and nature of its business.

(viii) We have broadly reviewed the books of account relating to the manufacture of Toothpastes, mouthwash and room fresheners pursuant to the Rules made by the Central Government of India, for the maintenance of cost records under clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956 and we are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have, however, not made a detailed examination of records with a view to determining whether they are accurate or complete. To the best of our knowledge and according to the information and explanations given to us, the Central government has not prescribed maintenance of cost records for any other products of the Company.

(ix) (a) The Company is regular in depositing with appropriate authorities undisputed statutory dues including income tax, wealth tax, sales tax, investor education and investor fund, customs duty, excise duty. However, there have been some delays in deposition of Tax deducted at source and collected at source, Service tax, Provident fund and Employees' state insurance applicable to it.

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.

(b) According to the information and explanations given to us, there are no dues of income tax, wealth tax, service tax, customs duty, excise duty and cess on account of any dispute which have not been deposited with the appropriate authorities. According to the information and explanations given to us, the following dues of sales tax have not been deposited by the company on account of dispute:

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

Sales Tax 6,55,188 FY 2006-07 Sales tax Appellate

Name of the Statue Un deposited Remarks amount

Sales Tax 363,686 This demand is for nondeposi -tion of CST forms. The forms have been subsequently deposited with the authorities

(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) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to a financial institution, bank and there are no dues to 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 provided to us, the Company has provided corporate guarantees amounting Rs. 134,314,729 to ICICI Bank Limited for loans taken by JHS Svendgaard Hygiene Products Limited. Amalgamation with these entities was approved by the Board vide its meeting dated July 7, 2010. Pending amalgamation approvals from Honourable High Court we are unable to comment, whether the terms and conditions of guarantees given by the company, are prejudicial or not to the interest of the company.

(xvi) In our opinion, the term loans have been applied for the purpose for which the loans were raised.

(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) According to the information and explanation given to us, the Company has made a preferential allotment of 500,000 shares to a party covered in the Register maintained under Section 301 of the Companies Act, 1956. The price at which the shares have been issued is not prejudicial to the interest of the company.

(xix) According to the information and explanations given to us, no debentures have been issued by the company during the year.

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

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

For Haribhakti & Co.

Chartered Accountants

Firm Registration No.103523W

Sd/- Raj Kumar Agarwal Place: New Delhi Partner

Date : May 26, 2012 Membership No.: 074715

---

Mar 31, 2011

1. We have audited the attached Balance Sheet of JHS Svendgaard Laboratories 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 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 by the Companies (Auditor's Report) (Amendment) Order, 2004, issued by the Central Government of India in terms of sub-section (4A) of Section 227 of 'The Companies Act, 1956' of India (the 'Act') and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give 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 paragraph 3 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. Without qualifying our opinion attention is invited to:

a) The Company is having a non operative and 11 dormant accounts having total balance of Rs.148,454 as per books as at March 31, 2011. We have not been received any balance confirmations for these non operative and dormant accounts from respective banks.

b) During the current year, the Company has produced hygiene product i.e. Odonil which is not specifically covered by object clause of the Memorandum of Association.

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

Annexure to the Auditors' Report

[Referred to in paragraph 3 of the Auditors' Report of even date to the members of JHS Svendgaard Laboratories Limited on the financial statements for the year ended March 31, 2011]

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

(b) The Company has a policy of physically verifying fixed assets according to a phased program to cover all the items over all 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. As informed, fixed assets have not been physically verified during the current year.

(c) In our opinion and according to the information and explanations given to us, a substantial part of fixed assets has not been disposed of by the Company during the year.

(ii) (a) The inventory has been physically verified by the management during the year. The Company is not having any inventory lying with third parties.

(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 carried out at the end of the year.

(iii) (a) The Company has not granted any loan to parties covered in the register maintained under section 301 of the Companies Act, 1956. Accordingly, the provisions stated in paragraph 4 (iii) (a) (b) (c) and

(d) of the order is not applicable.

(e) The Company has taken loan from two parties covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year is Rs.26,486,500 and the year-end balancec of loans are Rs.14,000,000.

(f) In our opinion, the rate of interest and other terms and conditions for such loan are not, prima facie, prejudicial to the interest of the Company.

(g) In respect of the aforesaid loan, the Company is regular in repaying the principal amounts as stipulated and has been regular in payment of interest.

(iv) In our opinion and according to the information and explanations given to us, there exists an adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventory. However, the internal control system needs to be strengthened to commensurate with the size of the Company and the nature of its business with regard to purchase of fixed assets and sale of goods. During the course of our audit, we have observed continuing failure to correct weakness in respect to internal control system related to sale of goods. However, such controls are being strengthened subsequent to the end of reporting period.

(v) (a) According to the information and explanations given to us, 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 Rupees five lacs 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) In our opinion and according to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of Sections 58A and 58AA of the Act and the rules framed there under.

(vii) The Company has an internal audit system, the scope and coverage of which, in our opinion requires to be widened to commensurate with the size and nature of its business.

(viii) We have broadly reviewed the books of account relating to the manufacture of Toothpastes, mouthwash and room fresheners pursuant to the Rules made by the Central Government of India, for the maintenance of cost records under clause (d) of sub-section (1) of Section 209 of the Companies Act , 1956 and we are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have, however, not made a detailed examination of records with a view to determining whether they are accurate or complete. To the best of our knowledge and according to the information and explanations given to us, the Central government has not prescribed maintenance of cost records for any other products of the Company.

(ix) (a) The Company is regular in depositing with appropriate authorities undisputed statutory dues including income tax, wealth tax, sales tax, investor education and investor fund, customs duty, excise duty. However, there have been delays in deposition of Tax deducted at source, Service tax, Provident fund and Employees' state insurance applicable to it. 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, 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 Amount Period to Forum where Amount Remarks statute (Rs.) which the dispute is deposited amount pending under relates protest

Sales Tax 2,90,833 FY 2007-08 Sales tax Appellate 290,833 These demands are Sales Tax 6,55,188 FY 2006-07 Sales tax Appellate 655,188 for non deposition of CSTforms. The forms have been subsequently deposited with the authorities.

(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) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to a financial institution, bank and there are no dues to 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 provided to us, during the year the Company has provided corporate guarantees amounting Rs.25 Crores and Rs.18.60 Crores to ICICI Bank Limited for loans taken by Waves hygiene Products and JHS Svendgaard Hygiene Products Limited respectively. Amalgamation with these entities was approved by the Board vide its meeting dated July 7, 2010. Pending amalgamation approvals from Hon'ble High Court we are unable to comment, whether the terms and conditions of guarantees given by the Company, are prejudicial or not to the interest of the Company.

(xvi) In our opinion, the term loans have been applied for the purpose for which the loans were raised.

(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) According to the information and explanation given to us, 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) According to the information and explanations given to us, no debentures have been issued by the Company during the year.

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

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

For Haribhakti & Co.

Chartered Accountants

Firm Registration No.103523W

Sd/-

Raj Kumar Agarwal

Place: New Delhi Partner

Date : December 5, 2011 Membership No.: 074715

---

Mar 31, 2010

1. We have audited the attached Balance Sheet of JHS Svendgaard Laboratories 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 by the Companies (Auditors Report) (Amendment) Order, 2004, issued by the Central Government of India in terms of sub-section (4A) of Section 227 of ‘The Companies Act, 1956 of India (the ‘Act) and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give 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 paragraph 3 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 cash flow statement, of the cash flows for the year ended on that date.

ANNEXURE TO THE AUDITORS REPORT [Referred to in paragraph 3 of the Auditors Report of even date to the members of JHS Svendgaard Laboratories Limited. on the financial statements for the year ended March 31, 2010]

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

b) The fixed assets have been physically verified by the management during the year. As informed, no material discrepancies were noticed on such verification.

c) In our opinion and according to the information and explanations given to us, a substantial part of fixed assets has not been disposed of by the Company during the year.

ii) a) The inventory has been physically verified by the management 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 carried out at the end of the year.

iii) a) The Company has granted loan to three companies covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount involved during the year was Rs.48,409,264 and the year end balance of loans granted to such parties was Rs.4,070,436.

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

c) The parties have repaid the principal amounts as stipulated and have also been regular in the payment of interest to the Company.

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

e) The Company had taken loan from a Director covered in the register maintained under section 301 of the Companies Act, 1956. The maximum amount outstanding during the year was f1,376,500 and the year- end balance was Rs.1,176,500.

f) In our opinion, the rate of interest and other terms and conditions for such loans are not, prima facie, prejudicial to the interest of the Company.

g) In respect of the aforesaid loans, the Company is regular in repaying the principal amounts as stipulated and has been regular in payment of interest,

iv) In our opinion and according to the information and explanations given to us, the internal control system needs to be strengthened in commensurate with the size of the Company and the nature of its business with regard to purchase of inventory, fixed assets and with regard to the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct weakness in internal control system of the Company.

v) a) According to the information and explanations given to us, 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 Rupees five lacs 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 within the meaning of Sections 58A and 58AA of the Act and the rules framed there under.

vii) In our opinion, the Company needs to be further strengthen its internal audit system to be commensurate with the size and nature of its business.

viii) The Central Government of India has not prescribed the maintenance of cost records under clause (d) of sub- section (1) of Section 209 of the Act for any of the products of the Company.

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.

Further, since the Central Government has till date not prescribed the amount of cess payable under section 441 A 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 information and explanation given to us, there are no dues of income tax, sales-tax, wealth tax, service tax, customs duty, excise duty and cess which have not been deposited on account of any dispute.

x) In our opinion, the accumulated losses of the Company are not more than fifty percent of its net worth. Further, the Company has not incurred cash losses during the financial year covered by our audit and the immediately preceding financial year.

xi) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to Banks. There are no dues payable to a financial institution or debenture holders.

xii) We are of the opinion that 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) In our opinion and according to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or financial institutions during the year.

xvi) In our opinion, the term loans have been applied for the purpose for which the loans were raised.

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) According to the information and explanations given to us, the Company has made preferential allotment of 800,000 equity shares by virtue of conversion of warrants to party covered in the register maintained under section 301 of the Act during the current year.

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

xx) There has been no utilization of money raised by public issues during the current year.

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

For Haribhakti & Co.

Chartered Accountants FRN No.103523W

Sd/- Raj Kumar Agarwal

Place: New Delhi Partner

Dated: May 29, 2010 Membership No.: 074715