Auditor Report of Setco Automotive Ltd.

Mar 31, 2025

We have audited the accompanying Standalone Financial Statements of Setco Automotive Limited (hereinafter referred
as “the Company”), which comprise the Balance sheet as at March 31, 2025, the Statement of Profit and Loss (including
Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then
ended and Notes to the Standalone Financial Statements, including a summary of material accounting policies and other
explanatory information (hereinafter collectively referred 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 (hereinafter referred as “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 (hereinafter
referred as “Ind AS”) and other accounting principles generally accepted in India, of the state of affairs (financial position)
of the Company as at March 31, 2025, its losses (financial performance including other comprehensive income), its cash
flows and the changes in equity for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (hereinafter referred as “SAs”) 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 (hereinafter referred as
“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 there under, and we have fulfilled our other ethical responsibilities in accordance
with these requirements and the ICAI''s Code of Ethics. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our opinion.

Emphasis of Matter

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

a. The company has not charged interest on unsecured loan to the subsidiaries. (Refer Note no. 3 and 9 of Standalone
Ind AS Financial Statements).

b. The Company has not provided Interest on the Unsecured Loan from Setco Auto Systems Private Limited (''SASPL''),
a subsidiary Company, as the same is repayable as per mutually agreed terms / period and no interest is accordingly
accrued on such liability. (Refer Note No. 13 of Standalone Ind AS Financial Statements).

c. The Company has total Non-Current Investment of Rs 23,350 Lakhs (Previous Year Rs. 23,357 Lakhs) as at the
balance sheet date, out of the same company has provided for ''Impairment in Value of Investments'' of Rs 11,133
Lakhs (Previous Year Rs. 11,133 Lakhs) in earlier years and stated at net value of Rs 12,217 Lakhs (Previous Year
Rs. 12,224 Lakhs), which is in the opinion of the management is fair value of the net investment.

Our opinion is not modified in respect of these matters

Key audit matter

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 year. These matters were addressed in the context of our audit of the
standalone financial statements taken as a whole; in forming our opinion thereon and we do not provide a separate opinion
on these matters. We have determined the key audit matter as described below:

Determination of fair value of carrying amount of investments

Description of key audit matter:

The Company has investments (net of impairment provisions) of Rs. 12,217 Lakhs as at 31 March 2025 consisting of
investments in the equity instruments of subsidiaries and other related entities which are valued as per Ind AS 109,
“Financial instruments”. By their nature, these are subjected to various factors related to respective investee entities
including but not limited to, economic factors, business dynamics, financial performance etc. and impact a fair valuation
of these investments. Accordingly, this necessitates a close monitoring by the management of these situations and
judgement, based on appropriate evaluation criteria to arrive at a fair value of carrying amounts of these assets as at
balance sheet date. Against this background, this matter was of significance in the context of our audit.

Description of Auditor response:

We have carried out a comparison between carrying value of investment as at balance sheet date and net worth as reflected
by latest audited and / or management certified financials of investee companies. Wherever carrying amount of investment
is more than the net-worth of investee Company we have discussed and enquired with the management the process
followed by them to identify permanent diminution, if any, in the value of investment and necessary accounting treatment
adopted in the books. In addition, management has provided us with the future business plans, wherever necessary and
how in their business judgement such gap between investment and net-worth of the investee is either compensated with
improving business conditions or valuations of such entities. Going forward our regular audit procedures are designed to
keep a follow up on outcomes of these management assertions.

Information other than the Standalone Financial Statements and Auditor’s Report thereon (hereinafter
referred as “other information”)

The Company''s Management and Board of Directors are responsible for the preparation of the other information. The
other information comprises the Board''s report and management discussion and analysis included in the annual report but
does not include the Standalone Financial Statements and our report thereon.

Our opinion on the Standalone Financial Statements does not cover the other information and we do not express any form
of assurance and / or conclusions thereon.

In connection with our audit of the Standalone Financial Statements, our responsibility is to read the other information
identified above when it becomes available and, in doing so, consider whether the other information is materially
inconsistent with the Standalone Financial Statements, or our knowledge obtained in the audit or otherwise appears to be
materially misstated. 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 Responsibilities for the Standalone Financial Statements

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

In preparing the Standalone Financial Statements, Company''s Management and Board of Directors are responsible for
assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern
and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease

operations, or has no realistic alternative but to do so.

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

Auditor''s Responsibilities for the audit of the Standalone Financial Statements:

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

a) 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.

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

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

d) 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.

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

2. As required by Section 143 (3) of the Act and 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 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 Ind AS specified under Section
133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015 as amended;

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

f) With respect to the adequacy of the internal financial controls 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, we report that 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; and

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 as at March 31, 2025 on its financial
position in its Standalone Financial Statements - Refer Note 31 to the Standalone Financial Statements.

ii. The Company has made provision, as required under the applicable law or Ind AS, for material
foreseeable losses, if any, on long term contracts including derivative contracts.

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

iv. Reporting on rule 11(e):

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; and

v. During the year, Company has not declared / paid any dividend hence reporting under rule 11 f is not
applicable to that extent.

vi. Based on our examination which included test checks and based on explanations and details provided
to us, except for the instance listed below, the company has used an accounting software for maintaining
its books of account which has a feature of recording audit trail (edit log) facility and the same has
operated throughout the year for all relevant transactions recorded in the software. Further, during the
course of our audit we did not come across any instance of audit trail feature being tampered with:

a. Table schema level changes carried out from the application are not tracked; and

b. The company uses SAP application, which is operated by a third-party software service provider,
for maintaining its books of account and in absence of either SOC2 report or Independent
auditor''s report, we are unable to comment whether audit trail feature of the said software was
enabled at database and operated throughout the year for all relevant transactions recorded in
the software or whether there were any instances of the audit trail feature been tampered with.

Additionally, except for the consequential impact of the points mentioned above, the audit trail has been preserved by the

Company as per the statutory requirements for records retention.

Sharp & Tannan Associates
Chartered Accountants
Firm''s Registration No.: 0109983W

by the hand of

CA Pramod Bhise
Partner

Membership No.: (F) 047751

Mumbai, May 27, 2025 UDIN: 25047751BMKXDL3214

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Mar 31, 2024

We have audited the accompanying Standalone Financial Statements of Setco Automotive Limited (hereinafter referred as “the Company”), which comprise the Balance sheet as at March 31, 2024, the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended and Notes to the Standalone Financial Statements, including a summary of material accounting policies and other explanatory information (hereinafter collectively referred 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 (hereinafter referred as “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 (hereinafter referred as “Ind AS”) and other accounting principles generally accepted in India, of the state of affairs (financial position) of the Company as at March 31, 2024, its profits (financial performance including other comprehensive income), its cash flows and the changes in equity for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (hereinafter referred as “SAs”) 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 (hereinafter referred as “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 there under, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAI''s Code of Ethics.We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Emphasis of Matter

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

a. The company has not charged interest on unsecured loan to the subsidiaries. (Refer Note no. 3and 9 of Standalone Ind ASF inancial Statements).

b. The Company has not provided Interest on the Unsecured Loan from Setco Auto Systems Private Limited (''SASPL''), a subsidiary Company, as the same is repayable as per mutually agreed terms/period and no interest is accordingly accrued on such liability. (Refer Note No. 13 of Standalone Ind AS Financial Statements).

c. The Company has total Non-Current Investment of Rs. 23,357 Lakhs as at the balance sheet date, out of the same company has provided for ''Impairment in Value of Investments'' of Rs. 11,133 Lakhs in earlier years and stated at net value of Rs. 12,224 Lakhs, which is in the opinion of the management is fair value of the net investment.

Our opinion is not modified in respect of these matters

Key audit matter

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 year. These matters were addressed in the context of our audit of the standalone financial statements taken as a whole; in forming our opinion thereon and we do not provide a separate opinion on these matters. We have determined the key audit matter as described below:

Determination of fairvalue of carrying amount of investments

Description of kev audit matter

The Company has investments net of provision of Rs. 12,224 Lakhs as at 31 March 2024 consisting of investments in the equity instruments of subsidiaries and other related entities which are valued as per Ind AS 109, “Financial instruments”. By their nature, these are subjected to various factors related to respective investee entities including but not limited to, economic factors, business dynamics, financial performance etc. and impact a fair valuation of these investments. Accordingly, this necessitates a close monitoring by the management of these situations and judgement, based on appropriate evaluation criteria to arrive at a fair value of carrying amounts of these assets as at balance sheet date. Against this background, this matterwas of significance in the context of ouraudit.

Description of Auditor response

We have carried out a comparison between carrying value of investment as at balance sheet date and net worth as reflected by latest audited financials of investee companies. Wherever carrying amount of investment is more than the net-worth of investee Company we have discussed and enquired with the management the process followed by them to identify permanent diminution, if any, in the value of investment and necessary accounting treatment adopted in the books. In addition, management has provided us with the future business plans, wherever necessary and how in their business judgement such gap between investment and net-worth of the investee is either compensated with improving business conditions or valuations of such entities. Going forward our regular audit procedures are designed to keep a follow up on outcomes of these management assertions.

Information other than the Standalone Financial Statements and Auditor''s Report thereon (hereinafter referred as “other information”)

The Company''s Management and Board of Directors are responsible for the preparation of the other information. The other information comprises the Board''s report and management discussion and analysis included in the annual report but does not include the Standalone Financial Statements and our report thereon.

Our opinion on the Standalone Financial Statements does not cover the other information and we do not express any form of assurance and / or conclusions thereon.

In connection with our audit of the Standalone Financial Statements, our responsibility is to read the other information identified above when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the Standalone Financial Statements, or our knowledge obtained in the audit or otherwise appears to be materially misstated. 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 Responsibilities for the Standalone Financial Statements

The Company''s Management and Board of Directors are responsible for the matters stated in Section 134(5) of the Act with respect to the preparation of these Standalone Financial Statements that give a true and fair view of the financial position, financial performance, cashflows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Ind AS. 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 detectingfraudsand other irregularities; selection and application of appropriate accounting policies; making judgments andestimates 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, Company''s Management and Board of Directors are responsible for assessing the Company''s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

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

Auditor''s Responsibilities forthe audit of the Standalone Financial Statements

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

a) 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, orthe override of internal control.

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

c) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and r elated disclosures made by management.

d) 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.

e) 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 S tatements 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 in terms

of Section 143 (11) of the Act, we give in the “Annexure A”, a statement on the matters specified in paragraphs 3 and 4

of the Order, to the extent applicable.

2. As required by Section 143 (3) of the Act and based on ourauditwe 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 a sit 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 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 Ind AS specified under Section 133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015 as amended;

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

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, we report that 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; and

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 as at March 31, 2024 on its financial position in its Standalone Financial Statements - Refer Note 32 to the Standalone Financial Statements.

ii. The Company has made provision, as required under the applicable law or Ind AS, for material foreseeable losses, if any, on long term contracts including derivative contracts.

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company as on 31 st March 2024.

w

iv. Reporting on rule 11 (e):

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; and

v. During the year, Company has not declared / paid any dividend hence reporting under rule 11 f is not applicable to that extent.

vi. Based on our examination which included test checks and based on explanations and details provided to us, except for the instance listed below, the company has used an accounting software for maintaining its books of account which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software. Further, during the course of our audit we did not come across any instance of audit trail feature being tampered with:

a. Table schema level changes carried out from the application are not tracked; and

b. The company uses SAP application, which is operated by a third-party software service provider, for maintaining its books of account and in absence of either SOC2 report or Independent auditor''s report, we are unable to comment whether audit trail feature of the said software was enabled at database and operated throughout the year for all relevant transactions recorded in the software or whether there were any instances of the audit trail feature been tampered with.

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

Sharp & Tannan Associates

Chartered Accountants Firm''s Registration No.:0109983W by the hand of

CAPramod Bhise

Partner

Membership No.: (F) 047751

Pune, July 12,2024 UDIN: 24047751BKAATU8018

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Mar 31, 2023

SETCO AUTOMOTIVE LIMITED Report on the audit of the Standalone Financial Statements

Opinion

We have audited the accompanying Standalone Financial Statements of Setco Automotive Limited (hereinafter referred as “the Company”), which comprise the Balance sheet as at March 31, 2023, the Statement of Profit and Loss (including Other Comprehensive Income), the Cash Flow Statement and the Statement of Changes in Equity for the year then ended and Notes to the Standalone Financial Statements, including a summary of significant accounting policies and other explanatory information (hereinafter collectively referred 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 (hereinafter referred as “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 (hereinafter referred as “Ind AS”) and other accounting principles generally accepted in India, of the state of affairs (financial position) of the Company as at March 31, 2023, its losses, other comprehensive income, its cash flows and the changes in equity for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (hereinafter referred as “SAs”) specified Under Section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditor''s responsibilities for the audit ofthe Standalone Financial Statements section of our report. We are independent ofthe Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (hereinafter referred as “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 there under, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the ICAI''s Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Emphasis of Matter

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

a. The company has not charged interest on unsecured loan to the subsidiaries. (Refer Note no. 4 and 10 of Standalone IndAS Financial Statements).

b. The Company has not provided Interest on the Unsecured Loan from Setco Auto Systems Private Limited (''SASPL''), a subsidiary Company, as the same is repayable as per mutually agreed terms / period and no interest is accordingly accrued on such liability. (Refer Note No. 14 of Standalone Ind AS Financial Statements).

c. Company has total Non-Current Investment of Rs. 23,344.77 Lakhs as at the balance sheet date, out of the same company has provided for ''Impairment in Value of Investments'' of Rs. 11,133.43 Lakhs in earlier years and stated at net value of Rs. 12,211.34 Lakhs, which is in the opinion of the management is fair value of the net investment.

Our opinion is not modified in respect of these matters

Information other than the Standalone Financial Statements and Auditor''s Report thereon (hereinafter referred as “other information”)

The Company''s Management and Board of Directors are responsible for the preparation of the other information. The other information comprises the Board''s report and management discussion and analysis included in the annual report but does not include the Standalone Financial Statements and our report thereon.

Our opinion on the Standalone Financial Statements does not cover the other information and we do not express any form of assurance and / or conclusions thereon.

In connection with our audit of the Standalone Financial Statements, our responsibility is to read the other information identified above when it becomes available and, in doing so, consider whether the other information is materially inconsistent with the Standalone Financial Statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. 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 Responsibilities for the Standalone Financial Statements

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

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

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

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

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

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

a. 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.

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

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

d. 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.

e. 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.

Other Matter

The Financial Statement includes the figures for the year ended March 31, 2022 which have been audited by predecessor auditor, who had issued unmodified opinion on the same.

Our opinion is not modified in respect of this other matter.

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 in

terms of Section 143 (11) of the Act, we give in the “Annexure A”, a statement on the matters specified in paragraphs

3 and 4 of the Order, to the extent applicable.

2. As required by Section 143 (3) of the Act and 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 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 Ind AS specified under Section 133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015 as amended;

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

f. With respect to the adequacy of the internal financial controls 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, we report that 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; and

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 as at March 31,2023 on its financial position in its Standalone Financial Statements - Refer note 38 to the Standalone Financial Statements.

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

material foreseeable losses. .

iii. There has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company as on 31^st march 2023.

iv. Reporting on rule 11(e):

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; and

v. During the year Company as not declared / paid any dividend hence reporting under rule 11 f is not applicable to that extent.

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 April 1, 2023, and accordingly, reporting under Rule 11(g) of Companies (Audit and Auditors) Rules, 2014 is not applicable for the financial year ended March 31,2023.

Sharp & Tannan Associates Chartered Accountants Firm''s Registration No.: 109983W by the hand of

CA Pramod Bhise Partner

Membership No.: (F) 047751

Pune, June 2, 2023 UDIN: 23047751BGTHXS5792

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Mar 31, 2021

REPORT ON THE AUDIT OF THE STANDALONE FINANCIAL STATEMENTSOPINION

We have audited the Standalone Financial Statements of Setco Automotive Limited (“the Company”), which comprise the Standalone Balance Sheet as at 31st March 2021, and the Standalone Statement of Profit and Loss (including Other Comprehensive Income), Standalone Statement of Changes in Equity, Standalone Statement of Cash Flows for the year then ended and notes to the Standalone Financial Statements, including a summary of significant accounting policies and other explanatory information

In our opinion and to the best of our information and according to the explanations given to us the aforesaid standalone financial statements give the information required by the Companies Act, 2013 (“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) Rule 2015, as amended (“Ind AS) and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2021, and Loss and total comprehensive income, changes in equity and its cash flows for the year ended on that date.

BASIS FOR OPINION

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Companies Act, 2013. Our responsibilities under those Standards are further described in the Auditor''s Responsibilities for the Audit of the Standalone Ind AS 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 Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on the standalone financial statement.

EMPHASIS OF MATTER

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

a) The management''s assessment of the impact of COVID -19 pandemic on its liquidity position and the recoverability of its assets comprising property, plant and equipment, inventories, receivables and other current assets as at the balance sheet date and on the basis of evaluation, has concluded that no material adjustments are required in the financial statements. (Refer Note No. 53 of Standalone Ind AS Financial

Statements).

b) The Company''s subsidiary Lava Cast Private Limited has eroded entire net worth due to losses. However, no impairment is provided on value of investment, based on the valuation report of Independent Valuer, as per DCF method. (Refer Note no. 3(b) of Standalone Ind AS Financial Statements).

c) The company has not charged interest on unsecured loan to the subsidiaries. (Refer Note no. 12(a) of Standalone Ind AS Financial Statements).

d) The Company has made investment of Rs. 5860 Lakhs in 9% cumulative compulsorily redeemable preference shares of Setco Engineering Private Limited, a company in which directors have interest. SEPL, being an investment company, derives its major income from Setco Automotive Limited in form of dividend and sales commission. SEPL has incurred loss in current year and hence, the Company has made impairment provision for loss of dividend. (Refer Note No. 33(c) of Standalone Ind AS Financial Statements)

e) The Company has invested Rs. 1,535.00 lakhs in 30,70,000 equity shares of SE Transstadia Private Limited, a company in which directors have interest. The investee Company has eroded entire net worth due to losses. Due to non-payment of interest and instalments, company''s accounts with bank have become NPA in December 2018. The investee company has submitted restructuring proposal to bank on 17.06.2020 and the same is under consideration. Based on the future projected profitable operations and report of Independent valuer as per DCF Method, the Company has provided impairment on this investment. (Refer Note No. 33(h) of Standalone Ind AS Financial Statements).

f) Amount receivable of Rs. 426 Lakhs towards sharing of common expenses from SE Transstadia Pvt. Ltd. (SETPL), a company in which directors are interested. Considering current financial position of SETPL, the said amount has remained outstanding. The company has made ECL provision of 20% of the outstanding amount. (Refer Note No. 33(g) of Standalone Ind AS Financial Statements)

g) The Company''s wholly owned ultimate foreign subsidiary Setco Automotive UK Ltd. has eroded net worth due to losses. Based on the report of Independent Valuer as per DCF method, provision for impairment has been made on the Investment and loans receivables from the subsidiary Company. (Refer Note No. 33 (b) of Standalone Ind As Financial Statements).

h) The Company''s wholly owned foreign subsidiary Setco MEA, DMCC has eroded net worth due to loss. The Company has provided impairment loss against trade receivable equal to the net assets deficit reported by the company. Pending compliance of Bank conditions, the Company could not remit share application money to this foreign subsidiary, since inception and hence, allotment of share and issue of share certificate is

pending. The Company has recognized it as investment in the subsidiary company and consolidated the said subsidiary based on 100% control. The Company has decided to close this subsidiary vide Board Resolution dated 09.02.2021. (Refer Note No. 33(d) of Standalone Ind AS Financial Statements)

i) Trade receivables, Trade Payables and other debit/ credit balances are subject to reconciliation and confirmation. (Refer Note No. 44 of Standalone Ind AS Financial Statements).

j) In earlier year, the Company has recognized Rs. 398 Lakhs as income being reimbursement of Central Goods & Service Tax (CGST)/Integrated Goods & Service Tax (IGST) share of State for the Uttarakhand unit pending notification of incentives by the State Government. In absence of any notification in the said matter, the Company has filed writ petition in High Court. Pending any further progress in this matter, the Company has provided for impairment at 100%. (Refer Note No. 33(e) of Standalone Ind AS Financial Statements)

k) An amount of Rs. 1834.99 lakhs (Rs. 3260.97 lakhs) is pending against export receivables as on 31 March 2021, beyond the timelines stipulated under the Foreign Exchange Management Act, 1999. The management of the Company has submitted necessary application with the appropriate authority for condonation of delays to regularize the default. Impact thereof if any, will be considered when such application is disposed off. (Refer Note No. 9 of Standalone Ind AS Financial Statements)

l) The company has provided ECL on investments in Equity and preference shares in WEW Holdings Limited (Mauritius) in respect of its holding in Setco Automotive (UK) Ltd. (Refer Note No. 3(c) of Standalone Ind AS Financial Statements).

m) Capital advances for purchase of machinery to the supplier was unrecoverable and thus 100% impairment provision is made. (Refer Note No. 33(f) of Standalone Ind AS Financial Statements).

n) On physical verification of stocks, stock costing Rs. 1863.92 lakhs were found to be rusty, damaged and unfit for consumption and unretrievable without compromising the quality of finished products. Therefore, such items of stocks are written down in the accounts net of the existing provision and valued at NIL and the net effect is disclosed under the head “Exceptional Items”. (Refer Note No. 33(i) of Standalone Ind AS Financial Statements).

o) The company has obtained consent of members to transfer the clutch manufacturing business to a wholly owned subsidiary in EGM held on 22nd May 2021.

Further the company has obtained member''s consent to purchase trademark/ Brand “LIPE” owned by foreign subsidiaries (SAUL & SANAI) based on valuations done by approved valuers.

In absence of binding agreements/ documents till date in this regard, no effect relating to said proposals are given or recognised in accounts for the year. (Refer to note no. 35 of the accompanying standalone Ind AS financial statement.)

Our opinion is not modified in respect of these matters.

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the standalone financial statements of the current period. These matters were addressed in the context of our audit of the Standalone Ind AS Financial Statements as a whole and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

1. Product Development:
Kev Audit Matters	How the matter was addressed in the audit
Intangible Assets: Product development	1. Testing management''s controls over capitalization
The Company conducts significant level of development activities and has to apply judgements	of Product development costs. 2. Evaluating the nature of development expenses
in identifying product development expenses meeting	incurred that are capitalized into product
the criteria for capitalization under the requirements	development expense.
of Ind AS. . Expenditure Identifiable and reliably measurable, incurred on product development yielding future economic benefits is capitalized as	3. Assessing the reasonableness of the capitalization based on success of the product,
Product Development Expenses. We identified the	4. Verifying amortization of capitalization after
capitalization of Product development costs as	commercial production commences as per
a key audit matter due to significant management	consistent policy of Company to amortise over
judgements about the future performance and	10 years.
viability of the products. 62	5. Obtaining fair valuation of product development capitalised from independent valuer. 6. Checking reasonableness of disclosure relating to research and development in financial statements. Refer to note no. 2 (iii) of the accompanying standalone Ind AS financial statement.

2. Impairment assessment of long-term investments	in,	oans receivables and trade receivables from
subsidiaries, ioint. venture and associates.
Kev Audit Matters	How the matter was addressed in the audit
The assessment of recoverable amount of the	1	Evaluated and tested the design and
Company''s investment in and loans receivable		implementation of operating effectiveness
and trade receivables from its subsidiaries and		of controls over the management review
joint venture and other related entity involves		process of impairment assessment.
significant iudgement. The investments are carried at cost less any diminution in value of such investments and tested for impairment at each reporting date. These includes assumptions	2	Compared the carrying amount of investment with the expected value of the business based on the discounted cash flow method.
such as projected cash flows, discount rates,	3	Assessed the key assumptions including
current work on hand, future contract future		discount rate and estimated future growth, of
business plan, claims, recoverability of certain		independent valuation report obtained by the
receivables as well as economic assumption		Company. Compared the previous forecast
such as growth rate.		to actual results to assess the Company''s
We focused on these areas as key audit matter		ability to forecast accurately.
due to judgement involved in forecasting future	4	We checked the loans advanced / repaid
cash flows and selection of assumptions.		in relation to these loans during the year through bank statements.
	5	. Evaluated accuracy of disclosure in the financial statements.
	Refer Note no. 3 & 33 of accompanying Standalone Ind AS financial statements.

INFORMATION OTHER THAN THE STANDALONE 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 Company''s annual report i. e. Corporate Information, Board of Directors, Management Discussion and Analysis, Directors Report and Corporate Governance Report but does not include the standalone financial statements and our auditors'' report thereon. The above information is yet to be provided to us.

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, total 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 of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgements and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial

statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the standalone financial statements, 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 the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.

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

• Identify and assess the risks of material misstatement

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

• Obtain an understanding of internal 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 standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Company to cease to continue as a going concern.

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

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

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor''s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated

in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

1. As required by the Companies (Auditor''s Report) Order, 2016 (“the Order”), issued by the Central Government of India in terms of section 143 (11) of the Act, we give in “Annexure A” a statement on the matters specified in paragraphs 3 and 4 of the Order, 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 including Other Comprehensive Income, the Statement of Changes in Equity 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 Ind AS specified under Section 133 of the Act.

e) On the basis of the written representations received from the directors as on 31st March, 2021 taken on record by the Board of Directors, none of the directors is disqualified as on 31st March, 2021 from being appointed as a director in terms of Section 164 (2) of the Act.

f) With respect to the adequacy of the internal financial controls 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, 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 43 B to the standalone financial statements;

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

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

For V. Parekh & Associates Chartered Accountants (Firm Registration No. 107488W)

(Rasesh V. Parekh)

Partner

Membership No. 38615 UDIN: 21038615AAAAKL5714

Place : Nathdwara

Date : 8^th August 2021

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Mar 31, 2018

- Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of SETCO AUTOMOTIVE LIMITED (“the company”), which comprise the Balance Sheet as at 31^st March, 2018, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Cash flows and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.

- 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 Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015, as amended.

This responsibility also includes the maintenance of adequate accounting records in accordance with the provision of the Act for safeguarding of the assets of the Company and for preventing and detecting the 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 control, 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.

- Auditors’ Responsibility

Our responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under and the Order issued under section 143(11) of the act.

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 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 true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by 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 audit opinion on the standalone Ind AS financial statements.

- Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements, give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31^st March, 2018 and its profit, the total comprehensive income, its cash flows and the changes in equity for the year ended on that date.

- Other Matters

The financial Information of the Company for the year ended March 31, 2017 and the transition date opening Balance Sheet as at April 01, 2016 included in these Standalone Ind AS Financial Statements, are based on the previously issued statutory financial statements for the year ended March 31, 2017 and March 31, 2016 prepared in accordance with the Companies (Accounting Standards) Rules, 2006 (as amended) which were audited by previous auditors, on which they expressed an unmodified opinion dated May 30, 2017 and May 30, 2016 respectively. The adjustments to those financial statements for the differences in accounting principles adopted by the Company on transition to the Ind AS have been audited by us.

- Emphasis of Matters

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

a) Trade payables’ balances are under reconciliation process. Necessary adjustments, if any, will be accounted when the same is reconciled. In respect of Trade receivables and other debit/credit balances, balance confirmations have not been obtained and therefore, are subject to reconciliation and adjustment if any. (Refer Note No. 43 of Standalone Ind AS Financial Statements).

b) The Company has invested Rs. 2,199.43 lakhs (Rs. 2,199.43 lakhs) in Equity & Preference shares of wholly owned ultimate foreign subsidiaries and also has outstanding receivables in form of loans & advances and debts (net) aggregating Rs. 7,178.59 lakhs (Rs.5,671.72 lakhs) from them as at 31.03.2018. Apart from company’s direct investments into these wholly owned ultimate foreign subsidiaries referred to above, the company’s ultimate wholly owned subsidiary, M/s Setco Automotive (UK) Ltd has an exclusive investment of Rs. 1,342.90 lakhs into equity shares of its step down wholly owned subsidiary, M/s. Setco Automotive (N.A.) Inc. These wholly owned ultimate foreign subsidiaries incurred consolidated accumulated losses of Rs. 2,884.60 lakhs (Rs. 2,404.48 lakhs) as at 31.03.2018 resulting into erosion of fair portion of their consolidated net worth. The management is of the opinion that this is a temporary phase considering business plans, future projected profitable operations, asset base, the investment being strategic in nature, going concern basis and solvency of subsidiaries supported by the Parent company (i.e. Setco Automotive Ltd), no provision is required to be made for diminution in value of these investments made in, loans & advances & debts due from the said subsidiaries and they are considered good. The carrying value of company’s investment in equity & preference shares is also supported by valuation report of Independent Chartered Accountant. (Refer Note No. 46 (ii) of Standalone Ind AS Financial Statements).

c) The company has in earlier years invested Rs. 1,535.00 lakhs in 30,70,000 equity shares of SE Transstadia Private Limited, a sports and entertainment infrastructure company. The said company has completed the project and has commenced commercial operations in March, 2017. The company has accumulated loss of Rs. 1,768.86 lakhs (Rs. 1,236.18 lakhs in F.Y. 2015-2016) as per latest audited financial statements as at 31.03.2017. In the opinion of the management, this investment is strategic in nature which has long term perspective and has comparatively long gestation period. This situation being a temporary phase and considering the future business plans, assets base and other developments, despite accumulated losses, the management firmly believes that there is no erosion in value of its investment in said related entity. The carrying value of Company’s investment in equity shares of said related entity is also supported by valuation report obtained from independent chartered accountant. (Refer Note No. 46 (iii) of Standalone Ind AS Financial Statements).

d) The company has invested Rs. 8,359.00 lakhs (Rs. 5,315.50 lakhs) in 8,35,90,000 (5,31,55,000) equity shares of Rs. 10/- each in its partly owned subsidiary Lava Cast Private Limited. The company’s second year of commercial production ended on 31^st March, 2018 resulting in accumulated loss of Rs. 4,659.36 lakhs (Rs. 2,281.99 lakhs). The management is of the opinion that this being a temporary phase and Company is in initial years of operations and considering the future business plans, assets base etc., no provision is required to be made for diminution in the value of this investment made in the said subsidiary. The carrying value of Company’s investment in equity shares of said related entity is also supported by valuation report obtained from independent chartered accountant. (Refer Note No. 46 (iv) of the Standalone Ind AS Financial Statements).

e) Pursuant to the Central Government Notification No. F.No.10(1)/2017-DBA-11/NER dated 05^th October, 2017, the company has recognised Rs. 549 lakhs as income being eligible reimbursement of Central Goods & Service Tax (CGST)/Integrated Goods & Service Tax (IGST) for its unit situated in Uttarakhand. The Company has further recognised Rs. 398 lakhs as income being reimbursement of Central Goods & Service Tax (CGST)/Integrated Goods & Service Tax (IGST) share of State for the said Uttarakhand unit pending notification of incentives by the State Government. The Company believes, the issuance of notification for Goods & Service Tax (GST) benefits by the State Government is certain based on the notification already issued by the Central Government. The Company shall lodge its formal claims after issue of notification by the State Government. (Refer Note No. 27 of the Standalone Ind AS Financial Statements).

Our opinion is not modified in respect of these matters.

- Report on other Legal and Regulatory Requirements

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

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

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

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

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

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

e) In our opinion, the matters described under the Emphasis of Matters paragraph above, prima facie, do not appear to have any adverse impact on the functioning of the Company.

f) On the basis of written representations received from the directors as on 31^st March, 2018 and taken on record by the Board of Directors, none of the directors is disqualified as on 31^st March, 2018, from being appointed as a director in terms of Section 164(2) of the Act.

g) 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.

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

i) The Company has disclosed the impact of pending litigations as at 31^st March, 2018 on its financial position in standalone Ind AS financial statements. (Refer Note No. 42 (B) of the Standalone Ind AS Financial Statements);

ii) The Company did not have any long-term contracts including derivative contracts as at 31^st March, 2018 for which there were any material foreseeable losses;

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

Referred to in paragraph under the heading “Report on Other Legal and Regulatory Requirements” of our report of even date to the Members of Setco Automotive Limited on the Ind As Financial Statements as of and for the year ended on March 31, 2018

1. In respect of its fixed assets:

a) The Company has maintained proper records showing full particulars including, quantitative details and situation, of fixed assets on the basis of available information.

b) As per the information and explanations given to us, there is a phased program of physical verification of fixed assets as adopted by the Company, which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. As informed to us, no material discrepancies were noticed on such verification.

c) The title deeds of immovable properties disclosed in Note No. 2 on Fixed Assets to the Ind AS Financial Statements except self-generated immovable properties are held in the name of the Company.

2. According to the information and explanations given to us, inventories (excluding stocks with third parties) were physically verified during the year by the management at reasonable intervals and no discrepancies were noticed during such verification. In respect of inventory lying with third parties, these have been substantially been confirmed by them.

3. According to the information and explanations given to us, the Company has not granted any loans, secured or unsecured to companies, firms, limited liability partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013 except loans given to its wholly owned ultimate foreign subsidiary companies.

a) The terms and conditions of such loans are not prima facie prejudicial to the Company’s interest.

b) No schedule of repayment of principal or interest has been stipulated for such loans.

c) In view of (b) above, the question of any overdue amount does not arise.

4. According to the information and explanations given to us, the Company has complied with the provisions of section 185 and 186 of the Act, with respect to Loans & Investments made.

5. According to the information and explanations given to us, the Company has not accepted any deposits under the directives issued by the Reserve Bank of India or within the meaning of section 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the rules framed there under.

6. We have been informed that company is not required to maintain cost records u/s. 148 (1) of the Companies Act, 2013.

7. According to the information and explanations given to us and on the basis of our examination of books of account:

a) The Company has been generally regular in depositing undisputed statutory dues with appropriate authorities including Provident Fund, Employees’ State Insurance, Income Tax, Professional Tax, Central Sales Tax, Service Tax, Custom Duty, Excise Duty, Value Added Tax, Goods and Service Tax, Cess and Tax Deducted at source, except few Instances of delays observed in deposition of Provident Fund, Income Tax, Professional Tax, Service Tax, Tax Deducted at Source, Custom Duty and Goods and Service Tax. According to the information and explanations given to us, there are no undisputed items outstanding as at 31^st March, 2018 for more than six months from the date they became payable.

b) According to information and explanations given to us and records of the company examined by us, there were disputed dues of Income Tax as of 31^st March, 2018 which have not been deposited as per following details:

Sr. No.	Name of the Statute	Nature of the dues	Amount (Rs. In Lakhs)	Period to which the amount related	Forum where dispute is pending	Remark, if any
1.	Income Tax Act, 1961	Penalty u/s. 271(1) (c)	12.01	A.Y. 2004 - 05	ITAT, Ahmedabad.	Refer Note no. 42 (B) of Standalone Financial Statements.
2	Income Tax Act, 1961	Demand u/s 156	590.13	A.Y. 2011-12	Commissioner of Income Tax (Appeals) -Vadodara.
3.	Income Tax Act, 1961	Income Tax dues	Nil (Note : 1)	A.Y. 2013 - 14 A.Y. 2014 - 15	Commissioner of Income Tax (Appeals) -Vadodara.
4	Income Tax Act, 1961	Income Tax dues as per Intimation u/s 143(1)	394.48	A.Y. 2015-16	CPC, Bengaluru.

Note:

1. The Company has preferred an appeal at ITat - Ahmedabad, for both the years i.e. A.Y. 2013-14 & 2014-15 for the disallowance of depreciation amount of product development by the department. Since the Company pays tax under Minimum Alternate Tax (MAT) i.e. Section 115JB, there is no additional demand due but the Minimum Alternate Tax (MAT) credit has been reduced due to the demand raised by the Income Tax Department.

2. In our opinion and according to the information & explanations given to us, the company has not defaulted in repayment of loans or borrowing obtained from banks and financial institutions. The company has neither taken any loan from government nor issued any debentures. In our opinion and according to the information and explanations given to us and examination of records of the company, the company has not raised moneys by way initial public offer or further public offer (including debt instruments) during the year. In our opinion and according to the information and explanations given to us, the money raised by way of term loans have been applied for the purpose for which they were obtained.

3. During the course of our examination of the books and records of the company and according to the information and explanations given to us, no fraud by the Company or on the Company by its officers or employees were noticed or reported during the year.

4. The company has paid/provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of section 197 read with schedule V of the Act.

5. As the company is not a Nidhi Company and the Nidhi Rules, 2014 are not applicable to it, the provision of Para 3(xii) of the Order is not applicable.

6. As per the information and explanation given to us, the transactions with the related parties are in compliance with Section 177 and 188 of the Act and the details there of have been disclosed in the Ind AS financial statements as required under Indian Accounting Standard (Ind AS) 24, “Related Party Disclosures” specified under section 133 of the Act (Refer Note No. 37 of the Standalone Ind AS Financial Statements).

7. As per the information and explanation given to us, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the period under review.

8. As per the information and explanation given to us, the Company has not entered into any non-cash transactions with directors or persons connected with him.

9. The Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934.

ANNEXURE B TO INDEPENDENT AUDITORS’ REPORT

Referred to in paragraph (g) under the heading “Report on Other Legal and Regulatory Requirements” by Section 143(3) of the Act” of our report of even date.

Report on the Internal Financial Controls under section 143(3)(i) of the Act.

We have audited the internal financial controls over financial reporting of Setco Automotive Limited (“the Company”) as of 31^st March, 2018 in conjunction with our audit of the Ind AS financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

The Company’s management is responsible for establishing and maintaining internal financial controls based on the internal control 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 (ICAI). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.

Auditors’ Responsibility

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 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 Institute of Chartered Accountants of India. 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 was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system 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 Ind AS financial statements, whether due to fraud or error.

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

Meaning of Internal Financial Controls Over Financial Reporting

A company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of Ind AS financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial control 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 Ind AS 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 Ind AS financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

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 the internal financial control 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

In our opinion, the Company has, in all material respects, a reasonably adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31st March, 2018 based on the internal control 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. However, such internal financial controls over financial reporting need to be improved and strengthened further in future.

For V. Parekh & Associates

Chartered Accountants

(Firm Registration No. 107488W)

(Rasesh V. Parekh)

Place : Mumbai Partner

Date : May 23, 2018 Membership No. 038615

---

Mar 31, 2016

To

THE MEMBERS OF

SETCO AUTOMOTIVE LIMITED

Report on the Stand of on a Financial Statement

We have audited the accompanying standalone financial statements of SFTCD AUTOMOTIVE LIMITED ("the company''), which comprise the Balance Sheet as at 31ST March 201B, the Statement of Profit and Loss und the Cash Flow Statement for the year then ended, and a summary of significant accounting policies and other explanatory information.

- Management Responsibility for the Standalone Financial Statement

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 lair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles genera My accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Flutes, £014 This responsibility also includes the maintenance of adequate accounting records In accordance with the provision of the Act for safeguarding of the assets of the Company and for preventing and detecting the frauds and other irregularities; selection and application of appropriate accounting policies: making lodgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial control, that were operating effectively for ensuring the accuracy and completeness of the accounting record?, relevant to the pre para two a n d presentation of the financial statement s that give a true an d 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 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 un Auditing specified under section 143(10) of the Act Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free From material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks or material misstatement of the Financial statements, whether due to Fraud or error In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the Financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by 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 u basis for our audit opinion on the standalone financial statements.

- Opinion

In our opinion and to the best of our information and according to the explanations given to us. the aforesaid standalone financial statements, give the information required by the Act in the manner so required and give a true and Fair view in conformity with the accounting principles generally accepted in India. Of the state of affairs of the Company as at 31st March, 201B and its profit and its cash flows for the year ended on that date.

- Emphasis of Matter

We draw attention to the Following matters in the Notes to the standalone financial statements;

i) Trade Payables, Trade Receivables and other debit and credit balances are subject to reconciliation and / or confirmation. (Refer Note No. 33 [i] of Standalone Financial Statements.

ii] The Company has invested Rs. 1 1.55.99,533/- in Equity & Preference shares of wholly owned ultimate foreign subsidiaries and also has outstanding receivables in form of loans & advances and debts [net) aggregating Rs.64,03,46.206/- from them as at 31.03.2016. Apart From company''s direct investments into these wholly owned ultimate foreign subsidiaries referred to above, the company’s ultimate wholly owned subsidiary. M/s Setco Automotive (UK) Ltd has an exclusive investment of Rs.6,46,05,000/- (US $ 15,00,000/- invested in F.Y 2006-07) into equity shares of its step down wholly owned subsidiary. M/s. Setco Automotive (N.A.) Inc. These wholly owned ultimate foreign subsidiaries incurred consolidated accumulated tosses of Rs. 12,34,12,067/- as at 31.032016 resulting into erosion of for portion of their consolidated net worth. The management is of the opinion that this is a temporary phase considering various efforts being made to restructure/stream line the operations of the wholly owned ultimate foreign subsidiaries, more particularly in case of M/a. Setco Automotive (UK) Limited, which is the major contributory subsidiary For consolidated accumulated losses. These being strategic investments made with a very long-term perspective and also in view of the asset base, business plans and projected profitable operations of the wholly owned ultimate foreign subsidiaries, in the opinion of the management, no provision is required to be made For diminution in value of these investments made in, loans & advances B. debts due from the said subsidiaries and they are considered good. (Refer Note Wd. 43(ii) of Standalone Financial Statements!

iii) The company has a set up of recognized Research & Development Centre (R SO Centre) at its Kalol plant. The activities of this R & D Centre are exclusively confined to the product development, particularly development of new products for domestic & international markets. The qualifying product development expenses of the said R & D Centre which satisfy recognition criteria For intangible asset as set cut in Accounting Standard-26 "Intangible Asset'' are capitalized by the company as Intangible Asset and is included under the head ''Intangible Asset under development'' in Note no. 11 ''fixed Assets" and the same shall be amortized as per amortization policy consistently followed by the company. Based on the Accounting Experts opinion obtained by the company, the accounting treatment referred to above is within the purview of Accounting Standajid-26 "Intangible Assets".

Till previous Financial year, such expenses were treated as revenue in nature S. charged off in the statement of Profit S loss since the recognition criteria for intangible asset as set but in Accounting Standard-26 ‘Intangible Assets" were not fully met.

The company had treated these R & ? expenditure as revenue expenditure in its declared Interim financial results for three quarters (Le up to 31.12.15) of E Y 2015-16 submitted to stock exchange. Based on accounting expert''s opinion referred to above, the company has restated said interim financial results incorporating the impact of above revision in accounting treatment & submitted the restated results for above-referred three quarters of FY. 2015-16 to stock exchange for public dissemination. [Refer Note No. 45 of Standalone Financial Statements).

Our opinion is not modified in respect of these matters,

- Report or other Legal and Regulatory requirements

As required by the Companies [Auditors Report] Order, 2016( “the Order"], issued by the Central Government of India in terms of Section 143(3) of the Act, we give in the Annexure A, a statement on the matters specified in paragraphs 3 and 4 of the said Order

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 Cash Flow Statement dealt with by this Report are in agreement with the books of account.

d) In our o pin ion, the aforesaid standalone financial statements com ply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

e) In our opinion, the matters described under the Emphasis of Matters paragraph above, prima facie, do not appear to have any adverse impact on the functioning of the Company.

f) On the basis of written representations received from the directors as on 31 March, 2016 and taken on record by the Board of Directors, none of the director is disqualified as on 31 March, 2016. from being appointed as a director in terms of Section 164(2] of the Act.

g) 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. and

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

i. The Company has disclosed the impact of pending litigations as at 31st March, 2016 on its financial position in standalone Financial statements. [ Refer Note Na. 32 [ B) of the standalone Financial statements.)

ii. The Company did not have any long-1arm contracts including derivative contracts as at 31st March, 2016 for-which there were any material foreseeable losses:

iii. There has been n o delay in transferring t he amounts, required to be transferred to the Investor Education and Protection Fund by the Company.

ANNEXURE A TO INDEPENDENT AUDITORS'' REPORT

(Referred to in paragraph under the heading "Report on Other Legal and Regulatory Requirements" of our report of even date)

i. In respect of its fixed assets :

a] The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets on the basis of available information.

b] As per the Information and explanations given to us. there is a phased program of physical verification of fixed assets as adopted by the Company, which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. As informed to us. no material discrepancies were noticed on such verification.

c] The title deeds of immovable properties (except self generated immovable properties) are held in the name of the Company.

ii. According to the inform ad ion and explanations given to us, inventories [excluding stocks with third parties) were physically verified during the year by the management at reasonable intervals and no discrepancies were noticed during such verification.

iii. According to the information and explanations given to us, the Company has not granted any loans, secured or unsecured to companies, firms, limited liability partnerships or other parties covered in the register maintained under section 103 of the Companies Act, 2013 except loans given to its wholly owned ultimate foreign subsidiary companies.

a. The terms and conditions of such loans are not prima facie prejudicial to the Company'' s interest.

b. No schedule of repayment of principal or interest has been stipulated for such loans.

c. In view of the above, the question of any overcut amount does not arise.

iv. According to the information and explanations given to us. the Company has complied with the provisions of section 185 & 186 of the Act, with respect to Loans & Investments made.

v. According to the information and explanations given to us, the Company has not accepted any deposits under the directives issued by the Reserve Bank of India or within the meaning of section 73 to 78 or any other relevant provisions of the Companies Act. 2013 and the rules [named there under.

vi. We have been informed that company is not required to maintain cost records u/s 148(1) of the Companies Act 2013.

vii. According to the information and explanations given to us and on the basis of our examination of books of account:

a) The Company has been generally regular in depositing undisputed dues including Provident Fund. Employees'' State Insurance, Income Tax. Central Sales-Tax, Service Tax, Custom Duty, Excise Duty, Value Added Tax, Cess, Professional Tax, Wealth Tax and Tax Deducted at Source with appropriate authorities though there have been few instances of delay in deposition m respect of Employees'' State Insurance. Income Tax. Excise Duty. Service Tax. Tax Deduction at Source and Custom Duty According to the information and explanations given to us, there are no undisputed items outstanding as at 31.03.2016 for more than six months From the date they became payable.

b) According to information and explanations given to us and records of the company examined by us, there were disputed dues of income tax and Value Added Tax as of 31st March. 2016 which have not been deposited except specifically stated:

Sr. No.	Name of the statute	Nature of the dues	Amount. (Rs.)	Period to which the amount relates (A.Y)	Forum where dispute is pending	Remark, if any
1	Income Tax Act, 1961	Penalty u/s 27lft3tc)	12,01,090/-	2004-05	CrTEAJ-4, Vadodara	Refer Note no. 32(B) of Standalone Financial statements.
a	Income Tax Act, 1961	income tax dues	Nil- Nil’ Nil- Nil-	2003-04 2004-05 2005-00 200007	ITAT, ? Bench Ahmedabad
3	Income Tax Act. 1901	Income tax dues	16,520/-	2010-11	FTAT, Ahmedabad
4	GVAT Act. 2003	VAT, penalty u/s 60(5) of GVAT Act, 2003	10,88,178/ (deposited)	2010-17	Deputy Commissioner- Appeal. Vedodare

’The Income Tax department has preferred appeals at ITAT, Ahmadabad For A.V 2003-04 to 2007-08. In case of F. Y 2003-04 to 2007-08, CIT(A) Vadodara has allowed the appeals in favour of the Com pony. The ITAT has already passed t he orders For A. Y 2002 - 03 and 2007-08 in favour of t he Company.

viii- In our opinion and according to the information & explanations given to us. the company has not defaulted in repayment of loans from banks and financial institution. The company has neither taken any loan from government nor issued any debentures,

ix. In our opinion and according to the information and explanations given to us and exemption of records of the company, the company has not raised any money by way mitral public offer or Further public offer( including debt instruments) during the year To the best of our knowledge and belief and according to the information and explanations given to us. in our opinion the term Scans raised during the year were applied For the purposes For which those were raised.

x. To the best of cur knowledge and belief and acceding to the information and explanations given to us. no fraud by the Company or on the Company by Its offices or employees were noticed or imported during the year.

xi. In our opinion and as per the information and explanation given to us. managerial remuneration has been paid or provided as per the provisions of section 197 read with Schedule V of the Act.

xii. In our opinion and according to the information and explanations given to us. the Company is not a Midhi Company. Accordingly, paragraph 3(xii) of the Order is not applicable.

xii. As per the information and explanation given to us,, the transactions with the related parties are m compliance with Section 1 77 and 1 33 at the Act and the details thereof have been disclosed in the standalone financial statements as required under accounting standard (AS) 10. "Related Party transactions" specified under section 130 of the Act. read with rule 7 to the Companies (Accounts) Rules 2014 (Refer Note No. 28 of the Standalone Financial Statements).

xiv. As per the information and explanation given to us, the Company has not made any preferential allotment or private placement of shares or Fully or partly convertible debentures during the year under review

xv As per the Information and explanation given to us. the Company bus not entered into .my non-cash transactions with directors or persons connected with him.

xvi. The Company is not required to be registered d under Section 45 -IA of t he Reserve Bank of India Act, 1934.

ANNEXURE B TO INDEPENDENT AUDITORS’ REPORT

(Referred to in paragraph under the heading "Report on Other Legal and Regulatory Requirements" of our report of even date)

We have audited the internal financial contra Is over financial reporting of SETCO Automotive Limited ("the Company") as of 31st March, 2016 in conjunction with our audit of the standalone financial statements of the Company For the year ended on that date.

Management''s Responsibility For Internal Financial Controls

The Company''s management is responsible for establishing and maintaining internal financial controls based on the internal control aver 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 (ICAI), These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to company''s policies, the safeguarding of its assets, the prevention and detection of Frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act-

Auditor’s Responsibility

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 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 Institute of Chartered Accountants of India. 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 was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls System 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 judgment, including the assessment of the risks of material misstatement of the standalone Financial statements, whether due to fraud or error

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company''s internal financial controls system over financial reporting.

Mining of Internal Financial Controls Over Financial Reporting

A company''s internal financial control 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 control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly inflect the transactions and dispositions of the assets of the company: (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company: and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company''s assets that could have a material effect on the financial statements.

Inherent Limitations of Intern at Financial Controls /Over Financial Reporting

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 the 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

In our opinion, the Company has, in all maternal respects, a reasonably adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as et 31st March, 2016 based on the internal control 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 [However. such internal financial controls Over financial reporting need to be improved nr id strengthened.

For MANE5H MEHTA & ASSOCIATES

Chartered Accountants

(Firm Registration No. 115832W)

(Monesh P. Mehta)

Place: Mumbai Partner

Date; May 30. 2016 Membership No. 036032

---

Mar 31, 2015

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

- Management's Responsibility for the Financial Statements

The Company's Board of Directors is responsible for the matters 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 the maintenance of adequate accounting records in accordance with the provision of the Act for safeguarding of the assets of the company and for preventing and detecting the 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 internal financial control, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error

- Auditors' 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 the ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give 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 on adequate internal financial controls system over financial reporting and the operative 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 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 31 March, 2015 and its profit and its cash flows for the year ended on that date.

- Emphasis of Matter

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

Trade Payables, Trade Receivables and other debit and credit balances are subject to reconciliation and/or confirmation (Refer Note No. 34(i) of Financial Statements)

Our opinion is not modified in respect of this matter.

- Report on Other Legal and Regulatory Requirements

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

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) In our opinion, the matter described under the Emphasis of Matters paragraph above, prima facie, does not appear to have any adverse impact on the functioning of the Company.

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

g) With respect to the other matters to be included in the Auditors' Report in accordance with Rule 11 of the Companies Act (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 financial statements. (Refer Note No. 33 (B) of the Financial Statements).

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

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

ANNEXURE TO INDEPENDENT AUDITORS' REPORT (Referred to in paragraph under the heading "Report on Other Legal and Regulatory Requirements" of our report of even date)

1. In respect of its fixed assets:

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

b) As per the information and explanations given to us, there is a phased program of physical verification of fixed assets as adopted by the Company, which in our opinion, is reasonable having regard to the size of the company and the nature of its assets. As informed, no material discrepancies were noticed on such verification.

2. In respect of its inventories:

a) According to the information and explanations given to us, inventories (excluding stocks with third parties) were physically verified during the year by the management at reasonable intervals.

b) According to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to size of the Company and the nature of its business.

c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories. No material discrepancies were noticed on physical verification of inventories.

3. According to the information and explanations given to us, the Company has not granted any Secured or Unsecured Loans to Companies, firms or other parties covered in the Register maintained under Section 189 of the Companies Act, 2013.

4. In our opinion and according to the information and explanations given to us, there is 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. The internal control system with regard to inventory management including purchase of inventory needs to be further strengthened. However, in our opinion, there is no continuing failure to correct major weaknesses in such internal controls.

5. According to the information and explanations given to us, the Company has not accepted any deposits, either under the directives issues by the Reserve Bank of India or within the meaning of section 73 to 76 of the Companies Act 2013 and the rules framed there under.

6. We have been informed that company is not required to maintain cost records u/s. 148 (1) of the Companies Act 2013.

7. According to the information and explanations given to us and on the basis of our examination of books of account:

(a) The Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Value Added Tax, Central Sales Tax, Income Tax, Tax Deducted at Source, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess with appropriate authorities though there have been few instances of delay in deposition in respect of Employees State Insurance, Income Tax, Wealth Tax, Custom Duty, Service Tax and Tax Deducted at Source. According to the information and explanations given to us, there are no disputed items outstanding for more than six months as of 31st March 2015.

(b) According to the information and explanations given to us and records of the Company examined by us, no amount has remained unpaid on account of any dispute as of 31st March 2015.

(c) According to the information and explanations given to us there has been no delay in transferring the amounts, required to be transferred to Investor Education and Protection Fund in accordance with the provisions of the Companies Act 1956 (1 of 1956) and rules made there under.

8. The company does not have accumulated losses as at 31st March 2015. The company has not incurred cash losses during the current year and in the immediately preceding financial year.

9. In our opinion and according to the information & explanations given to us, the company has not defaulted in repayment of dues with regard to loans obtained from banks. The company has neither taken any loan from any financial institution nor issued any debentures.

10. The Company has given guarantees for loans taken by its wholly owned ultimate foreign subsidiaries and Indian subsidiary from banks. In our opinion and according to the information and explanations given to us, the terms and conditions of the said guarantees are not, prima facie, prejudicial to the interest of the company.

11. In our opinion and according to the information and explanations given to us, and examination of records of the company, the term loans availed by the Company during the year were applied for the purposes for which the loans were obtained.

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

13. In our opinion and as per the information and explanations given to us, the nature of the Company's business/activities during the year is such that clauses tiii) (a) & tb) of the Companies (Auditor's Report) Order, 2015 are not applicable.

For MANESH MEHTA & ASSOCIATES

Chartered Accountants (Firm Registration No. 115832W)

(Manesh P. Mehta)

Place: Mumbai Partner

Date: May 26, 2015 Membership No. 036032

---

Mar 31, 2014

* Report on the Financial Statements

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

* Management''s Responsibility for the Financial Statements

The Company''s 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 notified under the Companies Act, 1956 ("the Act") read: with General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013. This responsibility includes the design, implementation and maintenance of internal controls 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 the ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal 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 the accounting policies used and the reasonableness of the accounting estimates made by the 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 aforesaid 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 31 March, 2014;

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

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

* Emphasis of Matter

Trade Payables, Trade Receivables and other debit and credit balances are subject to reconciliation and/or confirmation (Refer Note No. 36[i]).

Our opinion is not qualified in respect of this matter

* Report on Other Legal and Regulatory Requirements

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 Section 227[4A] of the Act, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order As required by Section 227(3) of the Act, we report that:

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.

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.

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.

In our opinion, the Balance Sheet, the Statement of Profit and Lose, and the Cash Flaw Statement comply with the Accounting Standards notified under the Companies Act, 1956 read with the General Circular 15/2013 dated 13th September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013.

On the basis of the written representations received From the directors as on 31 March 2014 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2014 from being appointed as a director in terms of Section 274(1) (g) of the Act.

ANNEXURE TO INDEPENDENT AUDITORS'' REPORT

(Referred to in paragraph under the heading "Report on Other Legal and Regulatory Requirements" of our repart of even date]

1. In respect of its fixed assets:

a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets an the basis of available information

b) As per the information and explanations given to us, there is a phased program of physical verification of fixed assets as adopted by the Company, which in our opinion, is reasonable having regard to the size of the company and the nature of the assets. As informed, no material discrepancies were noticed on such verification.

c) The fixed assets disposed off during the year, in our opinion, do not constitute a substantial part of the fixed assets of the Company and such disposal has, in our opinion, not affected the going concern status of the Company.

2. In respect of its inventories:

a) According to the information and explanations given to us, inventories [excluding stocks with third parties)were physically verified during the year by the management at reasonable intervals.

b) According ta the information and explanations given to us, the procedures of physical verification of inventories fallowed by the management are reasonable and adequate in relation to size of the Company and the nature of its business

c) In our opinion and according tD the information and explanations given to us, the Company has maintained proper records of its inventories. No material discrepancies were noticed on physical verification of inventory.

3. According to the information and explanations given to us, the Company has neither granted nor taken any loans to/from Companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956.

4. In our opinion and according to the information and explanations given to us. there is 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. The internal control system with regard to inventory management including purchase of inventory needs to be further strengthened. However, in our opinion, there is no continuing failure to correct major weaknesses in such internal controls.

5. According to the information and explanations given to us, we are of the opinion that particulars of contracts or arrangements that need to be entered in the Register maintained in pursuance of Section 301 of the Companies Act, 1I956, have been so entered. In our opinion and according to the information explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding the value of Rupees five lacs have been made at prices which prima facie appear reasonable as per information available with the company.

6. According to the information and explanations given ta us, the Company has not accepted any deposits from the public within the meaning of section 58A and 58AA of the Companies Act, 1956 and the rules framed there under

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

8. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies [Cost Accounting Records] Rules, 2011 prescribed by the Central Government under Section 209(1)(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

9. According do the information and explanations given to us and on the basis of our examination of books of account:

a) The Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Value Added Tax, Central Sales Tax, income Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess with appropriate authorities though there have been few instances of delay in deposition in respect of Provident Fund, Central Sales Tax, Value Added Tax, Employee State Insurance, Wealth Tax, Service Tax and Tax Deducted at Source. According do the information and explanations given to us, there are no undisputed items outstanding for more than six months as of 31st March, 2014.

b) According to information and explanations given do us and records of the company examined by us, the particulars of dues related to Sales Tax/Value Added Tax which have not been deposited as on 31st March, 2014 on account of dispute are as fallows:

Nature of Nature of Forum where Period to Statute Dues Dispute is which pending amount relates

Central Sales Tax Penalty Joint A.Y 2013-14 Act, 1956 / Value Commissioner Added Tax, 2005 (Appeals), Commercial Tax Department. Uttarakhand

Nature of Amount Statute Involved (Rs.) Central Sales Tax 22,77,634/- Act, 1956 / Value Added Tax, 2005

10. The company does not have accumulated losses as at 31.03.2014. The company has not incurred cash losses during the current year and in the immediately preceding financial year.

11. In our opinion and according to the information & explanations given to us the company has not defaulted in repayment of dues with regard to loans obtained from banks. The company has not taken loan from any financial institution nor issued any debentures

12. The Company has given guarantees for loans taken by its ultimate foreign subsidiaries from banks. In our opinion and according to the information and explanations given to us, the terms and conditions of the said guarantees ere not, prima facie, prejudicial to the interest of the company.

13. In our opinion and according to the information and explanations given to us, the term loans availed by the Company during the year were, prirra facie, applied for the purposes for which the loans were obtained.

14. According to the information and explanations given to us and based on our examination of the balance sheet on an overall basis, we are of the opinion that, prima facie, short-term funds amounting to Rs. 16,24,06,504/- have been used for long-term investment in non-current assets.

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

16. The Company has not issued any debentures during the year.

17. The company has not raised any money from public issue during the year.

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

19. In our opinion and as per the information and explanations given to us, the nature of the Company''s business/activities during the year is such that clauses (xii), (xiii), and (xiv) of the Companies (Auditor''s Report) Order, 2003 are not applicable.

For MANESH MEHTA & ASSOCIATES Chartered Accountants (Firm Registration No. 115839W)

(M.P. Mehta) Place: Mumbai: Partner Date: May 30, 2014 Membership No. 036032

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Mar 31, 2012

1. We have audited the attached Balance Sheet of Setco Automotive Limited as at 31st March, 2012 and also the Statement of Profit and Loss and the Cash Flow Statement of the Company 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 & 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 Section 227 (4A) of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to in paragraph 3 above, 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 purposes of our audit;

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

c) The Balance Sheet, Statement of Profit & 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 & 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;

e) On the basis of the written representations received from the directors as on 31st March, 2012 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March, 2012 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

f) Sundry debit & credit balances are subject to reconciliation and/or confirmation (Refer Note 41(i) - "Notes forming part of Financial Statements")

g) Attention is invited to the Note No. 35 - "Notes forming part of Financial Statements, on impact of survey proceedings conducted by Income tax Department during the year on MAT credit entitlement of Rs. 9,04,26,348/- forgone.

h) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements, read with Notes thereon, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(i) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2012

(ii) In the case of Statement of Profit and Loss, of the Profit for the year ended on that date, and

(iii) 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 our report of even date)

1. In respect of its fixed assets:

a) The Company has maintained proper records showing full particulars and situation of fixed assets on the basis of available information.

b) As per the information and explanations given to us, there is a phased program of physical verification of fixed assets as adopted by the Company, which in our opinion, is reasonable having regard to the size of the company and the nature of the assets. As informed, no material discrepancies were noticed on such verification.

c) In our opinion and according to the information & explanations given to us, no substantial part of the fixed assets has been disposed off during the year and hence, going concern status of the company is not affected.

2. In respect of its inventories:

a) According to the information and explanations given to us, inventories (excluding stocks with third parties) were physically verified during the year by the management at reasonable intervals.

b) According to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to size of the Company and the nature of its business.

c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories. No material discrepancies were noticed on physical verification of inventory.

3. According to the information and explanations given to us, the Company has neither granted nor taken any loans to/from Companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956.

4. In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and the nature of its business with regard to purchase of inventory, fixed assets and sale of goods. We have not observed any continuing failure to correct major weaknesses in such internal controls.

5. According to the information and explanations given to us, we are of the opinion that particulars of contracts or arrangements that need to be entered in the register maintained in pursuance of Section 301 of the Companies Act, 1956, have been so entered.

In our opinion and according to the information & explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding the value of Rupees five lacs have been made at prices which appear reasonable as per information available with the company.

6. According to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of section 58A and 58AA of the Companies Act, 1956 and the rules framed there under.

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

8. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Accounting Records) Rules, 2011 prescribed by the Central Government under Section 209(1)(d) of the Companies Act, 1956 and are of the opinion that prima facie the prescribed cost records have been maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

9. According to the information and explanations given to us and on the basis of our examination of books of account:

a) The Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, VAT, Central Sales Tax, Income Tax, Wealth Tax, Custom Duty, Excise Duty and Cess with appropriate authorities though there have been few instances of delay in deposition in respect of Service Tax, Tax Deducted at Source, Tax Collected at Source, Professional Tax and Central Sales Tax. According to the information and explanations given to us, there are no undisputed items outstanding for more than six months as of 31st March, 2012.

b) According to the information and explanations given to us, there were no disputed amounts remaining unpaid in respect of VAT, Central Sales Tax, Excise duty, Service Tax, Income Tax, Wealth Tax, Cess and Custom Duty.

10. The Company does not have accumulated losses as at 31.03.2012. The company has not incurred cash losses during the current year and in the immediately preceding financial year.

11. In our opinion and according to the information & explanations given to us, Company has not defaulted in repayment of dues with regard to loans obtained from banks. The company has not taken loan from any financial institution nor issued any debentures.

12. The Company has given guarantees for loans taken by its foreign subsidiaries from banks. In our opinion and according to the information and explanations given to us, the terms and conditions of the said guarantees are not, prima facie, prejudicial to the interest of the company.

13. In our opinion and according to the information and explanations given to us, the term loans availed by the Company during the year were, prima facie, applied for the purposes for which the loans were obtained.

14. According to the information and explanations given to us and based on our examination of the balance sheet on an overall basis, we report that no funds raised on short-term basis have been used for long- term investment.

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

16. The Company has not issued any debentures during the year.

17. The Company has not raised any money from public issue during the year.

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

19. In our opinion and as per the information and explanations given to us, the nature of the Company's business/activities during the year is such that clauses (xii), (xiii) and (xiv) of the Companies (Auditor's Report) Order, 2003 are not applicable.

For Manesh Mehta & Associates

Chartered Accountants

(Firm Registration No. : 115832W)

Place : Mumbai (M.P.MEHTA)

Date : 05.07.2012 Partner

(M. No. 036032)

---

Mar 31, 2011

1. We have audited the attached Balance Sheet of Setco Automotive Limited as at 31st March, 2011 and also the Profit and Loss Account and the Cash Flow Statement of the Company 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.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan & 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 Section 227 (4A) of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to in paragraph 3 above, 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 purposes of our audit;

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

c) The Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account;

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

e) Central Government has not yet notified the rules relating to the levy & collection of cess from Companies in terms of section 441A of the Companies Act, 1956. We are, therefore, not reporting on this matter as required by section 227 (3) (g) of the Companies Act, 1956.

f) On the basis of the written representations received from the directors as on 31st March, 2011 and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March, 2011 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

g) Sundry debit & credit balances are subject to reconciliation and/or confirmation (Refer Note 14(a) of Schedule 19 - "Notes forming part of Accounts”)

h) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements, read with the Significant Accounting Policies and Notes forming part of 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:

(i) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2011

(ii) In the case of Profit and Loss Account, of the Profit for the year ended on that date, and

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

ANNEXURE as at 31st March, 2011 Referred to in paragraph 3 of our report of even date)

1. In respect of its fixed assets:

a) The Company has maintained records showing particulars and situation of fixed assets on the basis of available information. However, same is required to be updated under SAP computerized system.

b) As per the information and explanations given to us, there is a phased program of physical verification of fixed assets as adopted by the Company, which in our opinion, is reasonable having regard to the size of the company and the nature of the assets. As informed, no material discrepancies were noticed on such verification.

c) In our opinion and according to the information & explanations given to us, no substantial part of the fixed assets has been disposed off during the year and hence, going concern status of the company is not affected.

2. In respect of its inventories:

a) According to the information and explanations given to us, inventories (excluding stocks with third parties) were physically verified during the year by the management at reasonable intervals.

b) According to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to size of the Company and the nature of its business.

c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories. No material discrepancies were noticed on physical verification of inventory.

3. According to the information and explanations given to us, the Company has neither granted nor taken any loans to/from Companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956.

4. In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and the nature of its business, with regard to purchase of inventory, fixed assets and sale of goods. We have not observed any continuing failure to correct major weaknesses in such internal controls.

5. According to the information and explanations given to us, we are of the opinion that particulars of contracts or arrangements that need to be entered in the Register maintained in pursuance of Section 301 of the Companies Act, 1956, have been so entered. In our opinion and according to the information & explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding the value of Rupees five lacs have been made at prices which appear reasonable having regard to the prevailing market prices at the relevant times.

6. The Company has not accepted any deposits from the public under section 58A and 58AA of the Companies Act, 1956 and the rules framed there under.

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

8. According to the information and explanations given to us, the maintenance of cost records has not been prescribed by the Central Government under section 209 (1) (d) of the Companies Act, 1956.

9. According to the information and explanations given to us and on the basis of our examination of books of account:

a) The Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Sales Tax, Income Tax, Wealth Tax, Custom Duty, Excise Duty and Cess with appropriate authorities though there have been few instances of delay in deposition in respect of Service Tax & TDS. According to the information and explanations given to us, there are no undisputed items outstanding for more than six months as of 31st March, 2011.

b) According to the information and explanations given to us, there were no disputed amounts remaining unpaid in respect of Sales Tax, Excise duty, Service Tax, Income Tax, Wealth Tax, Cess and Custom Duty.

10. The company does not have accumulated losses as at 31.03.2011. The company has not incurred cash losses during the current year and in the immediately preceding financial year.

11. In our opinion and according to the information & explanations given to us, Company has not defaulted in repayment of dues with regard to loans obtained from banks. The company has not taken loan from any financial institution nor issued any debentures.

12. The Company has given guarantees for loans taken by its foreign subsidiaries from banks. In our opinion and according to the information and explanations given to us, the terms and conditions of the said guarantees are not, prima facie, prejudicial to the interest of the company.

13. In our opinion and according to the information and explanations given to us, the term loans availed by the Company during the year were, prima facie, applied for the purposes for which the loans were obtained.

14. According to the information and explanations given to us and based on our examination of the balance sheet on an overall basis, we report that no funds raised on short-term basis have been used for long-term investment.

15. The Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under section 301 of the Companies Act, 1956 during the year and accordingly, the question of whether the price at which the shares have been issued is prejudicial to the interest of the company does not arise.

16. The Company has not issued any debentures during the year and accordingly, the question of creating security in respect thereof does not arise.

17. The company has not raised any money from public issue during the year and in the recent past and accordingly, the question of disclosing the end use of money raised by public issue does not arise.

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

19. In our opinion and as per the information and explanations given to us, the nature of the Company's business/activities during the year is such that clauses (xii), (xiii) and (xiv) of the Companies (Auditor's Report) Order, 2003 are not applicable.

For MANESH MEHTA & ASSOCIATES

Chartered Accountants

(Firm Registration No. : 115832W)

(B. R. BHATT)

Place: Mumbai Partner

Date: 30th May, 2011 (M. No. 40007)

---

Mar 31, 2010

1. We have audited the attached Balance Sheet of Setco Automotive Limited as at 31st March, 2010 and also the Profit and Loss Account and the Cash Flow Statement of the Company 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.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan & 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 Section 227 (4A) of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to in paragraph 3 above, 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 purposes of our audit;

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

c) The Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account;

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

e) Central Government has yet not notified the rules relating to the levy & collection of cess from Companies in terms of section 441A of the Companies Act, 1956. We are, therefore, not reporting on this matter as required by section 227 (3) (g) of the Companies Act, 1956.

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

g) Sundry debit & credit balances are subject to reconciliation and/or confirmation (Refer Note 13 of Schedule 18 - "Notes forming part of Accounts")

h) Attention is invited to Accounting Policy No. 7(i) in Schedule 17 - "Significant Accounting Policies" and Note No. 10 in Schedule 18 - "Notes forming part of Accounts" for the change in accounting policy made during the year in revenue recognition and its ultimate impact on the Profits and Reserves & Surplus of the company. The current years profits and Reserves & Surplus are lower by Rs. 40,61,284/- on account of the said change.

i) in our opinion and to the best of our information and according to the explanations given to us, the said financial statements, read with the Significant Accounting Policies and Notes forming part of 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:

(i) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2010 (ii) In the case of Profit and Loss Account, of the Profit for the year ended on that date, and (iii) In the case of Cash Flow Statement, of the cash flows for the year ended on that date. Annexure to the Auditors Report 1. In respect of its fixed assets:

a) The Company has maintained proper records showing particulars and situation of fixed assets. However, same is required to be refined with the newly implemented SAP computerized system.

b) As per the information and explanations given to us, there is a phased program of physical verification of fixed assets as adopted by the Company, which in our opinion, is reasonable having regard to the size of the company and the nature of the assets. As informed, no material discrepancies were noticed on such verification.

c) In our opinion and according to the information & explanations given to us, no substantial part of the fixed assets has been disposed off during the year and hence, going concern status of the company is not affected.

2. In respect of its inventories:

a) According to the information and explanations given to us, inventories were physically verified during the year by the management at reasonable intervals.

b) According to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to size of the Company and the nature of its business.

c) In our opinion and according to the information and explanations given to us, the Company has maintained proper records of its inventories. No material discrepancies were noticed on physical verification of inventory.

3. According to the information and explanations given to us, the Company has neither granted nor taken any loans to/ from Companies, firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956.

4. In our opinion and according to the information and explanations given to us, there is adequate internal control system commensurate with the size of the Company and the nature of its business, with regard to purchase of inventory, fixed assets, sale of goods and services. We have not observed any continuing failure to correct major weaknesses in such internal controls.

5. According to the information and explanations given to us, we are of the opinion that particulars of contracts or arrangements that need to be entered in the Register maintained in pursuance of Section 301 of the Companies Act, 1956, have been so entered. In our opinion and according to the information & explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding the value of Rupees five lacs have been made at prices which are reasonable having regard to the prevailing market prices at the relevant times.

6. The Company has not accepted any deposits from the public under section 58A and 58AA of the Companies Act, 1956 and the rules framed there under.

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

8. According to the information and explanations given to us, the maintenance of cost records has not been prescribed by the Central Government under section 209 (1) (d) of the companies Act, 1956.

9. According to the information and explanations given to us and on the basis of our examination of books of account: a) The Company has been generally regular in depositing undisputed statutory dues including Provident Fund and Employees State Insurance with appropriate authorities though there have been few instances of delay in deposition in respect of Professional Tax, Service Tax, Sales Tax, TCS, etc. However, there have been frequent delays during the year in depositing Tax deducted at Source. According to the information and explanations given to us, there are no undisputed items outstanding for more than six months as of 31st March, 2010.

b) According to the information and explanations given to us, there were no disputed amounts remaining unpaid inrespect of Sales Tax, Excise duty, Service Tax and Custom Duty except following amounts in respect of income tax: Sr. No. Name of the Statue Assessment Year Amount (Rs.) Forum where dispute is pending

Commissioner of Income Tax (Appeals),

1 Income Tax Act, 1961 2006-07 3,02,265/-

Baroda

2 Income Tax Act, 1961 2007-08 10,83,490/ Commissioner of Income (Appears) Baroda

10. The company does not have accumulated losses as at 31.03.2010. The company has not incurred cash losses during the current year and the immediately preceding financial year.

11. In our opinion and according to the information & explanations given to us, Company has not defaulted in repayment of dues with regard to loans obtained from banks. The company has not taken any other loan from any financial institution nor issued any debentures.

12. The Company has given guarantees for loans taken by its subsidiaries from banks. In our opinion and according to the information and explanations given to us, the terms and conditions of the said guarantees are not, prima facie, prejudicial to the interest of the company.

13. In our opinion and according to the information and explanations given to us, the term loans availed by the Company during the year were, prima facie, applied for the purposes for which the loans were obtained.

14. According to the information and explanations given to us and based on our examination of the balance sheet on an overall basis, we report that no funds raised on short-term basis have been used for long-term investment.

15. The Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under section 301 of the Companies Act, 1956 during the year and accordingly, the question of whether the price at which the shares have been issued is prejudicial to the interest of the company does not arise.

16. The Company has not issued any debentures during the year and accordingly, the question of creating security in respect thereof does not arise.

17. The company has not raised any money from public issue during the year and in the recent past and accordingly, the question of disclosing the end use of money raised by public issue does not arise.

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

19. In our opinion and as per the information and explanations given to us, the nature of the Companys business/activities during the year is such that clauses (xii), (xiii) and (xiv) of the Companies (Auditors Report) Order, 2003 are not applicable.

For MANESH MEHTA & ASSOCIATES

Chartered Accountants

(Firm Registration No.: 115832W)

(M.P.MEHTA)

Partner (M. No. 36032)

Place: Mumbai Date: 28/06/2010