Auditor Report of Walchandnagar Industries Ltd.

Mar 31, 2025

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

In our opinion and to the best of our information and according
to the explanations given to us, the aforesaid Financial Statements
give the information required by the Companies Act, 2013 (the
"Act") in the manner so required and give a true and fair view in
conformity with the Indian Accounting Standards prescribed
under Section 133 of the ("Act"), ("Ind AS") and other accounting
principles generally accepted in India, of the state of affairs of the
Company as at March 31, 2025, and its loss, total comprehensive
income, changes in equity and its cash flows for the year ended on
that date.

Basis for Opinion

We conducted our audit of the Financial Statements in accordance
with the Standards on Auditing ("SA") specified under Section
143 (10) of the Act. Our responsibilities under those Standards are
further described in the Auditor''s Responsibilities for the Audit for
the Audit of the 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 Financial Statements under the provisions of the
Act and the rules made thereunder, and we have fulfilled our other
ethical responsibilities in accordance with these requirements and
the ICAI''s Code of Ethics.

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

1. We draw attention to Note 58 of the Financial Statements,
which describes the suspension of operations at the
Company''s Foundry Division with effect from March 20, 2025,
due to violent collective acts by the workmen. Subsequent
to the year-end, the Company withdrew the suspension and
declared a lockout with effect from April 12, 2025, thereby
continuing the halt in operations.

2. We draw attention to Note 26 of the Financial Statements,
which describes the recognition of a provision amounting
to ?4,362 Lakhs under "Other Expenses" in respect of
expected losses on certain ongoing Tamil Nadu Electricity
Board projects (TNEB Customer). The provision has been
recognized by the Company pursuant to a reassessment of
the estimated costs required for completion of the balance
work, following resolution of certain project-related issues
with the customer.

Our opinion is not modified in respect of these matters.

Key Audit Matters

Key audit matters are those matters that, in our professional
judgment, were of most significance in our audit of the Financial
Statements for the financial year ended March 31, 2025. These
matters were addressed in the context of our audit of the Financial
Statements as a whole, and in forming our opinion thereon, and
we do not provide a separate opinion on these matters. For each
matter below, our description of how our audit addressed the
matter is provided in that context.

We have determined the matters described below to be the key
audit matters to be communicated in our report. We have fulfilled
the responsibilities described in the Auditor''s Responsibilities for the
Audit of the Financial Statements section of our report, including
in relation to these matters. Accordingly, our audit included the
performance of procedures designed to respond to our assessment
of the risks of material misstatement of the Financial Statements.
The results of our audit procedures, including the procedures
performed to address the matters below, provide the basis for our
audit opinion on the accompanying Financial Statements.

Key audit matters	How our audit addressed the key audit matter
Recoverneility of TrnOe Receivables: Trade receivables amounting to ? 15,014 Lakhs represents approximately 17.22% of the total assets of the Company as at March 31,2025. In asses sing the recoverability of the aforesaid balances arid determination of allowance for expected creditlcos, management''s judgement involves consideration of aging status, historical payment records, evaluation of litigations, the likelihood of collection bared oit the terms oftheeontractand credit informatihn of its costomer. We censider this a s key audit matter due to materiality of the amoants and significant estimates and judgements as stated above.	Our auoit procedures amongst ethers included the tofowing: • Understood and tested on a sample besis toe desi°n and operating effectiveness of management control over assessing the recoverability odthn tfade receivables. • Performed test of details and tested relevant contracts, documents and sndsequent receipts for materia. trade receivables balances. • Te ste d the aging of trade rece iva bl es as at the year-end an sample basis. • Assessed the allowance for expected credit loss made by management.
ReveBue Recognition: There are significant accoonting fudgements ia estimating revenues to be recognized on contracts with customers,inolu ding estimation of costs to complete. The Company recognizes revenue on the basis of stage of completion in proportion of the contract costs incurred at balance sheet date, relative to tho total estimated costs ofthe contract at completion. The reoognition of7 revenue is therefore depen dent on estima.es if rela tion to totall e stimated costs of each such contract. We ceofidet this as fey audit matter lue to materiality of the amounts and significant estimates a nd foygements as otated above.	The audit procedures included but were not limited to: i. Read contract documents for each selection, change orders, a nd other documents that were part of the agreement. ii. Verification of total Cost incurred for each project as per books oO accounts, total Cost to Complete each project, project profitability statements, as reviewed by projects heads.It was verified that the cost for completing balanced work is reviewed and revised wherever necessary based on current scenario aed future expectations. iii. Obtaining a detailed understanding of the processes, c ontrols and policies of the Management with respect to preparation of project profitability statements, eva!uating the design of controls including approvals and reslated com pliances, testing implementation and oee rating effectiveness ef the controls.

We have determined that there are no other key audit matters to
communicate in oor reyort.

Information other than the Finandal Statements and Auditor''s
Report thereon

The Company''s Board ofDirectors is responsible forthe °reparation
of the other informatioa. The otoer information comprises the
information included in the Company''s Annual Report but does
not include the Isd AS finanaial statemene ana ourauditor''s report
thereon.

Our opinion on the Financial Statements does not cover the
other information and we do eot express any form of assurance
conclusion thereon.

In connection with oae audit e^f the Financial Statement, our
responsibility is to read the other information aad, in doing so,
consider whether the other information is materially inconsintent
with the Finnncial Statements, or our knowledge obtained during
the course of ous audit or otherwife appears to be mnterially
misstated.

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

Responsibilitiey of Management and those charged with
governance for the Financial Statements

The Company''s Boatd of Directors is responsible for the matters
stated in Section 134 (5) ofthe Act with Bespest Oo the preparation
of thene Financiai Statements that give a true and fair view of
the financial position, financial performance including other
no mprehe nsive income, changes in equi ty and cash flows of the
Company in accordance with the accountino principleo geoerally
acceptedin India,including Indisn Accounting Statdardn specifies
under Sention 133 of the Act. This respoositrility also includes
maintenance of⁷ ade cjeate hccounting reoords in nccord ance wit.
the provisions ofthn Actfor safeguardmg the assets ofthe Company
and for preveoting and detecting frauds and ot°erirregularities;
selection and application of⁷ appropriate accounting policies;
making fudgments and estimates thatare reasonalale and peudent;
and design,implementationand maintenance ofadeqeate internal

financial controls, that were operating effectively for ensuring the
accuracy and completeness of the accounting records, relevant to
the preparation and presentation of the financial statements that
give a true and fair view and are free from material misstatement,
whether due to fraud or error.

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

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

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

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

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

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

• Obtain an understanding of internal 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 an adequate internal financial
controls with reference to Financial Statements in place and
the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used
and the reasonableness of accounting estimates and related

disclosures made by the management.

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

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

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

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

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

From the matters communicated with those charged with
governance, we determine those matters that were of most
significance in the audit of the 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.

We did not audit the financial statements / information of Ethiopia
division included in thefinancialstatements ofthe Company whose
financial statements / financial information reflect total assets of ?
101.18 Lakhs as at March 31,2025, and the total revenue of ? Nil,
total expenses of ? 5.50 Lakhs for the year ended as at March 31,
2025. The financial stotements / information of this division has
been audited by the ifdependent auditorwhose report han been
furnished tss us_sand our opinion in sofanas it relctfstothe amounts
and disclosures included in respect of such division, is based solely
on the re port of such auditor.

Our opinionis not modi fied in respe ct of this matfe r.

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 at India in
tsrms of Sob-Section (11) od Shction 143 od the Act, we give
in the /On nexure“A", a statement o a th e matters s pe cifi od in
paragraphs i and 4 ofthe Order, to the; extont applicable. As
required bye Section 143(3) of the Act, based on our audit we
report that:

t. We have sorght and obdained all thi inSosmation aod

explanations which to the best of our knowledge add
belief were rocessaryforthe purp os es ofourouOit.

b_r In our opinion,proper books of account rs required
by law have been dept by th e Compann so fa r a sit
appearf from our exa minatior oh oh ose looks .

a. T^de Balance Sheet, the Statiment of Profit and Loss,
includinig Otoer Comprehensive Income, Statement:
of⁷ Cha nges in equity and the Statement of Cash Flows
dealt with by this Reaort ore in agreement with tine?
books.

d. In our opinion, the aforesaid financial stotementf
comply with the lod AS specified under Section 133 of
the Act.

e. On toe basis of ^rhe written reprenentations received
from the directors as on Mmrch 31, ^p025, taken or?
record lay the Board of Directors, none of the directors
is disqualified as no March 31, 2025, from being
nppointed as a director in terms ooSec tion 164- (2) of
the Act.

f. With respect to tUa adequacp of thi internalfinancial
controls with reference to Financial (Statements ofthe
Company anb tho operating effectiveness oS such
controls_o refer no our sepnrate report in "Annexure
B". Our re|hort expresses an nnmodified vpinioo on
the adequacy and operating effectiveness of the
Company''s internal financinl controls with repenence
to tCe Financial Statements.

g. With respect to the other matters to be included if toe

Auditor''s Report it accordanee with the renuirements
o^f Section 197(16) of the Act, as amendtd, id our
opinion apd oocording to toe informatinn and
explanations given to us, the remuneration paid by
the Company toits directors durina the: currentyearis
in accordanc ewith tOa provisions of Cec tion 19 7 of tCn
Act.

^C. With respect to the otoer matters to be included
in th e Auditor''s Report in accordance with Rule 11
of t in e Com p an i e s (A u d i t an d Au ditors) R ules , 2014-,
as amended, in our opinion and to the best of our
information and according to the explanations given
to us:

i. The Company has disclosed the impacU of
pending litigations on its financial position in
its Financial Statements. Refer Note - 54 to the
Financial Statements.

ii. The Company has made provision, as required
under the applicable law or accounting
standards, for material foreseeable losses, if any,
on long-term contracts, including derivative
contra ctt.

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

iv. a. The management has represented

that, to fhe best of its knowledge and
be lief, n o fun ds (which a re matesial
either individuelly or in aggregate) havo
been advanced or loaned or invested
(eitheo from berrowed fundo or sfiarn
premium or eny other sources or kird
of⁷ fuads) by the Company to os in any
other persoos or entities, ipcluding
foreign ertitief ("Intermediaries"),

with the understondieg, whether

recorded in writing or otherwise, that
the Ibtermediaoy shall, whether direatly
or indirectly lend or invert in other
persons or e ntities bentfied in any
manner whatsoever by or of behalt of
the Company ("Ultimate BeneVciaries")
of provide any guaranies., socuritn or
the like to or on behalf of toe Ultimate
Beaeficiaries.

b. The management has represented that,
to the best of its knowledge and belief,
no funds (which are material either
individually or ia agirevate) have beeo

received by the Company from any
persons or entities, including foreign
entities ("Funding Parties"), with the
understanding, whether recorded in
writing or otherwise, that the Company
shall, 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 from or 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.

. The Company has neither declared nor paid any

dividend during the year.

vi. Based on our examination, which included
test checks, the Company has used accounting
software for maintaining its books of account for
the financial year ended March 31,2025, which
has a feature of recording audit trail (edit log)
facility and the same has operated throughout
the year for all relevant transactions recorded
in the software. Further, during the course of
our audit we did not come across any instance
of the audit trail feature being tampered with
and the audit trail has been preserved by the
Company as per the statutory requirements for
record retention.

For Jayesh Sanghrajka & Co. LLP

Chartered Accountants

ICAI Firm Registration Number: 104184W/W100075

Pritesh Bhagat

Designated Partner

Membership Number: 144424

UDIN: 25144424BMIYMI8982

Place: Navi Mumbai

Date: May 22, 2025

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Mar 31, 2024

We have audited the accompanying Financial Statements of Walchandnagar Industries Limited (the "Company"), which comprise the Balance Sheet as at March 31, 2024, the Statement of Profit and Lons (inclnding Other Compsehensive Income), the statementofChangesin Equity and tie Stotementof Cash Flowsfor the year ended on that date and notes to the Financial Statements, including n summary ot material ancouniing policies and other explanatory informa tion (hereinafter referred to as the "Financial Statements").

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Financial Statements give the ieformation required by the Companies Act, 2(013 (the "Act") in th n manner so required and give a true a nd fair viuw i i conformity with the Indian Accounting Standards prescribed under section 133 of the ("Act"), ("Ind AS") and other accounting principles generally accepted in India, oS the stote of affairs of thn Compony as at March 31, 2024, and its loss, total comprehensivu income, changes in evuity and its cash flowsfortheyear ended on that date.

Basis for Opinion

We conducted our audit of the FinanciaiStatements in accordance with the Standards on Auditing ("SA") npecified unUer Sectiun 143 (10) ef the Act. Our responsibilities under tdone Standards are furthea nesnribea in the Auditor''s Responsibilities tor the Audit of⁷ the Finanaial etatements Section of our report. We are independent

of the Company in accordanee with the Code oS Etdics issued by the Institute of Chartered Accountants of India ("ICAI") togetier with t^fe erthicoI roq uiremenis that are relevant to our aud it of the FinncdalStatements undet the prouisions of the Act and thie rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirvmects and bhe ICAI''s Code of Ethics_r

We believe that the audit evidence obtained by uc is sufficient and appropriate to provide a basi s ^for ouraudit opi nion on the fina ncial statements.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Financial Statements for the financial year ended March 31, 2024. These matters were addressed in the context of our audit ofthe Financial Statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. For each matter belcw, our description of how our audit addressed the matter is provided in that context.

We have determined the matters described below to be the key audit matters to be communicated in our report. We have fulfilled the responsibilities described in the Auditor''s Responsibilities for the Audit of the Financial Statements section of our report, including in relation to these matters. Accordingly, our audit included the performance of procedures designed to respond to our assessment of thie? risks of material misstatement of the Financial Statements. The results of our audit procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the accompanying Financial Statements.

Key audit matters

How our audit addrensed the key aunit matter

Recoverability of Trade Receivalnles: Trade reueivables amounting to '' 17,375 Lakhs represents approximately 19.84% of the total assets of the Company as at March 31,2024. In assussing the recoverabiliby of the aforestid balances and determination oSallowance for expected credit loss, management''s judgement involves consideration of aging status, historical payment records, evalnation ou l itigatinns, tha likelihood of collection biased on the terms of the contract and credit information of its customer. We cvnsider this as key audit matter due to materiality of the amounts and significant estimates and |udgemurts as stated above.

Our aulit procedures amongst othero included the following: • Ucderstoud anh tested on a sample ucnis the denign and operating effective ness of7 management coatrul over assissing the recoverability of7 the trade reeeivables. • Performenl Rest cf details and tested relevant contracts, documents and subsequent receipts fur materia0 trade receivables Calancess • Tested the aging of trade receivables as at the year-end on sample basin. • Aosessed the allowance hor expected credit loss mahe Uy management.

Key audit matters

How our audit addressed the key audit matter

Revenue Recognition: There are significant accounting judgements in estimating revenue to be recognized on contracts with customers, including estimation of costs to complete. The Company recognizes revenue on the basis of stage of completion in proportion of the contract costs incurred at balance sheet date, relative to the total estimated costs of the contract at completion. The recognition of revenue is therefore dependent on estimates in relation to total estimated costs of each such contract. We consider this as key audit matter due to materiality of the amounts and significant estimates and judgements as stated above.

The audit procedures included but were not limited to: i. Read contract documents for each selection, change orders, and other documents that were part of the agreement. ii. Verification of total Cost incurred for each project as per books of accounts, total Cost to Complete each project, project profitability statements, as reviewed by projects heads. It was verified that the cost for completing balanced work is reviewed and revised wherever necessary based on current scenario and future expectations. iii. Obtaining a detailed understanding of the processes, controls and policies of the Management with respect to preparation of project profitability statements, evaluating the design of controls including approvals and related compliances, testing implementation and operating effectiveness of the controls.

We have determined that there are no other key audit matters tc communicate in our report.

Information other than the Financial Statements and Auditor''s Report thereon

The Company''s Board of Directors is responsible for the preparation of the other information. The other information comprises the information included in the Management Discussion and Analysis Board''s Report including Annexure to Board''s Report, Business Responsibility and Sustainability Report, Corporate Governance and Shareholder''s Information, but does not include the Financia Statements and our Auditor''s Report thereon.

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

In connection with our audit of the Financial Statements, our responsibility is to read the other information and, in doing so consider whether the other information is materially inconsistent with the Financial Statements, or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated.

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

Responsibilities of Management and those charged with governance for the 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 Financial Statements that give a true and fair view of the financial position, financial performance including othei comprehensive income, changes in equity and cash flows of the Company in accordance with the accounting principles generally accepted in India, including Indian Accounting Standards specified under Section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with

the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

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

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

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

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

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

• Identify and assess the risks of material misstatement of the Financial Statemente, wtether due to fraud or error, design and performaudit proceduresresponsive to those riske, and obtnin audit evidence that is sufficient and appropriate to pro vide 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 of⁷ i nternal (to ntrol.

• Obtain an undetstatding of internal conprol relevant eo the audit in order to design audit procedures that are appropriate in the cirtumstantet. Under Section 143(3)(i) of the Act, we are also responsible for expressing 02r opinion ot whether the Company eas an adequate internal fintncial tontrols wiehi reference to Financial Statements in place and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related d istlosures made by the manageme nt.

• Oonclude on theappropriateness ot manegement''s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to eve nts or conditions that may cast significant doubt on the Compana''s ability to continue as a goint concetn. If we conclude that a materitl uncertainty existn, we ate requited to draw attention in pur auditor''s report to the reltted disclosnres in the Financial Statements or, if tech disclosnres areinadequate,to modify our opininn. Our conclusions are bastd on t^ye audit evidence obtained up to the date of our auditor''s report. However, future events or conditions may cause the Comptny to tease to codtinue as a going cancern.

• Evaluate the overall presentation, structure, and content of the Financial Statements, including the disclosures, and whether the Financial Statements represfnt the ntdprlying ttanstctions and events in a manner that achieves ftir presentation.

Materiality is the magnitude of misstatements in the Financial Statements that,individually orin aggregate, makes it probable that the economic decisions erf a reastnably ktionvledgeabln user of the Financial Seatements may beinflunnced. We consider quantitativt materiality and tentative factort in O) planning the scope of⁷ our audit work and in evaluating the results of our work; and (ii) to eveluate ttie effect ofany identited misstatements in the Financiat Statemtnts.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significantaud itfindin^ps, including any significatt deficiencies in internal financial controls that we identi fy duri ng our audio.

We also provide tpnse charged witp tovernance with a statemett that we have ctmplied with relnvantethical reouirements regarding independenne, and to communicate with them all relationships and other matters th at may reasonably pp tOought to btor oe our independence,and where a ppl icable, related sateguards.

From the mattere communicated with those charged witk governatce, we determine those matters that were ot most significance in the audit ctthn Financial Statements of tte current period and are thnrefore the ket audit maeters. 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 Rdtermine that a matter should not be communicated it aur report because the atverse tonseqnences of doing so would reaso nab ly be exnn cted to outwe igk th e p ublic interest benefits of suoh com mu nicotinn.

Other Matter

We d i d n o t au d i t t h e Fi n a n ci al Statem e n t s I information of Ethiopia division included in the Financial Statements of the Company whose Financial Statements I financial information reflect total assets of '' 1109.5 lakhs and total liabilities of '' 1127.42 Larhs asat March 31,2024, and the total revenue of? Nil ahd total exponses of '' 3.30 Lakhs for the year ended on that Oate. The Einancial Statements I information of this division has been audited by the independent auditor whose report has been furnished to us, and our opinim it fo tar as it relates to the amounts and disclosures included it respect of such division, is based solely on the report of euchotheraudiaor.

Our opinion is not modified in respect of this 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 of India in terms of⁷ Sub-Section (11) of Section 143 of the Act, we give in the Annexure "A", a stateme nt on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable. As required by Section 143(3) of the Act, based on our audit we re°ort that:

c. We Aave sought and obtained all the information and

explanutionn whicA to the test oO our knowledge and beliefwere necessary fottde pu rpo ses of oer audit.

b. In our opinion, proper btoks of⁷ account as required bylaw have been kept try the Company so far as it appears trom our ecamihation ofthote books.

c. Tht Baiance Sheet, the Stutement of Profit and Loss (including Other Comprehensive Income), Statement erf Changes id equity and the; etatement of⁷ cash flows dealr with by tNs Report are m aiejreemett with tlen books.

d. In our opinion, the aforesaid financial statements complywith the Ind AS soecified utder Seation 133 of the /act.

e. On the basis of the written representations received from the director as on March °1, 20°4, taken nt retord bythe Board of Direttors, none of tiee directors is disqualified as eon Mnrch 31, ^t024, from bring apipointnd as a direttorin terms of Section 164 (2) erf⁷ the Act.

f. With respecf to the adequacy ot the mternalfinandal

controls with reference to Financial Statements 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 with reference to the Financial Statements.

g. With respect to the other matters to be included in the Auditor''s Report in accordance with the requirements of Section 197(16) of the Act, as amended, in our opinion and according to the information and explanations given to us, the remuneration paid by the Company to its directors during the current year is in accordance with the provisions of Section 197 of the Act.

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

i. The Company has disclosed the impact of pending litigations on its financial position in its Financial Statements. Refer Note - 53 to the Financial Statements.

ii. The Company has made provision, as required under the applicable law or accounting standards, 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.

iv. a. The management has represented

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

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

v. The Company has neither declared nor paid any dividend during the year.

vi. Based on our examination, which included test checks, the Company has used accounting softwares for maintaining its books of account for the financial year ended March 31, 2024, 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 softwares. Further, during the course of our audit we did not come across any instance of the audit trail feature being 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 preservation of audit trail as per the statutory requirements for record retention is not applicable for the financial year ended March 31, 2024.

For Jayesh Sanghrajka & Co. LLP

Chartered Accountants

ICAI Firm Registration Number: 104184W/W100075

Pritesh Bhagat

Designated Partner

Membership Number: 144424

UDIN: 24144424BKFJMZ8143

Place: Mumbai

Date: May 28, 2024

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Mar 31, 2023

We have audited the accompanying Ind AS Financial Statements of WALCHANDNAGAR INDUSTRIES LIMITED ("the Company") which comprise the Balance Sheet as at March 31, 2023, the Statement of Profit and loss including the statement of Other Comprehensive Income, cash flow statement and statement of Changes in Equity for the year then ended, and notes to the Ind AS Financial Statements, including a summary of significant accounting policies and other explanatory information and which include the Returns for the year ended on that date audited by the independent auditor of the Company''s division located in Ethiopia.

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid 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 accounting principles generally accepted in India, of the state of affairs flows and any as at March 31, 2023, and its profit 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 (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 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 together with the ethical requirements that are relevant to our audit of the Ind AS Financial Statements under the provisions of the Companies Act, 2013 and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

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

a. Expected credit loss on trade receivables ("ECL"). The company has used a practical expedient by computing the ECL on trade receivables based on a provision matrix.

This area required significant attention because substantial amount of management''s judgment and estimates were involved.

Our procedures included the following, but were not limited to:

1. Discussion with respective business heads for understanding the working of estimates done.

2. Verification of details of Liquidated Damages charged by clients and total sales for the period from 1st April 2016 to 31st March 2023. This historical data were used by the management in their analysis of credit loss experience.

3. Verification of contract documents, correspondence with clients pertaining to projects where specific loss provisioning was made. The Management estimate is based on such forward information and historical data to derive division-wise provisioning values.

b. Calculation for percentage completion for revenue for projects operating over time under IND AS 115: Calculation of Cost to complete the projects for arriving at percentage of completion is crucial for revenue recognition. Management has prepared profitability statements for all the projects which are operating over time as per IND AS 115. This area required significant attention because it involved lots of estimates and management judgements.

Our procedures included the following, but were not limited to:

1. Verification of total contract values from signed Contract with customers, progress reports, invoices certified by clients.

2. Verification of total Cost incurred for each project as per books of accounts, total Cost to Complete each project, project profitability statements, as reviewed by projects heads. It was verified that the cost for completing balance work is reviewed and revised wherever necessary based on current scenario and future expectations.

3. obtaining a detailed understanding of the processes, controls and policies of the Management with respect to preparation of project profitability statements, evaluating the design of controls including approvals and related compliances, testing implementation and operating effectiveness of the controls

Information Other than the Ind AS Financial Statements and Auditor''s Report thereon

The Company''s Board of Directors is responsible for the preparation of the other information. The other information comprises the information included in the Management Discussion and Analysis,

Board''s Report including Annexures to Board''s Report, [Business Res ponsibility R eport, Corporate Governa nce and Share holder''s Information, but does not include the Ied AS Financial Statements and ourauditor''s report thereon.

Our opinion on the Ind AS Financial Statements does not cover the otherinformation and we do not express any form of assurance do nclusion thereon.

In connection with our audit ofthe I net AS Rnancial Statements, our responsibility is to read t^fe other information and, in domg so, consider wdethir the other information is materially inconsisteNt with theInd AS Financiel Statements, or our knowledge obtained during the cou rse of⁷ our audit or oth erwise appears to he ma teri ally misstafed.

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 trr report in this regard.

Management''s Responsibility foo the Ind AS Financial Statements

The Company''s Board o^r Directors is responsible for the matters stated in section 13 4(5) of the Companien Act, 2013 ("the Aci") with respect to the preparation of thesr Ind AS Financial Statements that give a true and fair view of the Uinancial pofitioi, financial performance, cOangesin equity end cash flows ol the Company ii accordance with the accounting principles generally accepted in India, including the recounting Standards snecified undee section 133 of the Act. This rescdnsibility also includes the maintenance of adequate accounting records in accordance with thB pfovisions of the Aot for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and applipation of appropriate accounting policies, making judgmenls and estimates that are reanoneble and prudent; nnd design, implementation end mainteeanco of adequateinternal financialcontrols, that were op grating effectively for tnsuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Ind AS Financial Statemento that givea true and fair view an0 are free from material misstatement,wSether due Ao fraud hr error.

In preparing the I net AS 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 usie^B the going contern basis ofaccountiog unless management either intends to liquidate the Company or to cease operations, or has no real isUic altnrnative butto do so.

The Board of Directors are also respnnsible for overseeing tire? company''s ^cinancial reporting process

Auditor''s Responsibilities foe the Audit of the Ind AS einaosial Statements

Our objectives are to obtain reasonable assurance about whet^fer the Ind AS FinoncialStatements as a whole are ffoe ffom material

misstaiem ent,whether duetoffanSor error,andtoisreoan auditor''s report that includes our opinion Reasonable assurance is a high level of⁷ assurance but is nota gua rantee t°at an audit co ndu cted in accordance wffh SAe will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considesed material in, indiniddally or ir the aggregate, ther could reasonably be eopeded to iefluence the economic decisions of users taken on tOe !a ois oft hese I sd AS Fin anc i al Sea temen ts.

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

• Identify and assess the risks of material misstatement of the Ind AS 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 opioion.The riskofnot 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 controls.

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

• Evaluate tire aporopi ateness of a cco unting po l icits used and the reasonable ne ss ofa ccoeii ing estimates and related djsclosureo made by management.

• Conclude on the appropriateness of⁷ management''s use of^{7 c}he going concern bcsis of accounting acd, based on thh qudit evidence obtained, whether a material uncertainty exis ts relate d to eventt oacondihonsthat may crstsignificant doubt on the Company''s ability to continue as a going soncern. Ifwe conclnde thut a ma torial uncertainty exi sts, we ere required to draw attontion in our auditor''f re°ort to the rented disclosures in the Inⁱ AS Finandal Statements or,if juch disclosures are inadequate, to modify our opinion Our conclustais are tosed on the andit evidence obtaioed up ti °he data o^f our auditor''s report Howevee ^futurh events or ceiditions may cause the Company to cease to continue ao a going concern.

• Evoluate the overallpresentation, strueture and coetant of ^fhe Ind A'' Finanda^| Statemin^fs, incled^fng the disclosures, ond whether the Ind AS Fiiansial Statementi represmt the underlying transaction s an d events in a manner that achieves fair presentation.

Materialityit the magnitude of misstatemeNtsin the Ind AS jinancirl Statements that,individuafy or in aggregate, maees

it probable that the economic decisions of a reasonably knowledgeable user of the Ind AS 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 Ind AS 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 Ind AS 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.

Emphasis of Matter

We draw attention to the following matters in Notes to Ind AS Financial Statements:

Refer Note No. 38 where it is mentioned that during the year, KKR assigned the loans, given by them to the Company by way of ICD and Debentures, to ACREs. There was a Standstill agreement dated July 19, 2022 between ACREs and the Company whereby on fulfilling certain conditions therein, the Company was eligible for waiver on the overall loan amount. The company has fulfilled the conditions as per the agreement. The company executed a Restructuring Agreement with ACRE on May 18, 2023. Since this is an adjusting event as per IND AS 10 "Events after reporting date", the company has disclosed net waiver amount of '' 10,539 Lakhs under "Exceptional Item" in the Statement and reduced its total debts from ACREs.

Our report is not modified in respect of this matter.

Other Matter

We did not audit the financial statements / information of Ethiopia division included in the financial statements of the Company whose financial statements / financial information reflect total assets of '' 1,104.59 lakhs and total liabilities of '' 2122.48 Lakhs as

at March 31,2023 and the total revenue of '' 1.98 Lakhs (Exchange Gain) and total expenses of '' 5.34 Lakhs for the year ended on that date. The financial statements / information of this division have been audited by the independent auditor whose report has been furnished to us, and our opinion in so far as it relates to the amounts and disclosures included in respect of such division, is based solely on the report of such auditor.

Our opinion is not modified in respect of this 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 of India in terms of sub-section (11) of section 143 of the Companies Act, 2013, we give in the Annexure A, a statement on the matters specified in paragraphs 3 and 4 of the Order, to the extent applicable.

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

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

b. In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books and proper returns adequate for the purpose of our audit have been received from overseas division not visited by us.

c. The reports on the accounts of the overseas Ethiopia division of the Company audited by independent auditor have been sent to us and have been properly dealt with by us in preparing this report.

d. The Balance Sheet, the Statement of Profit and loss, changes in equity and the Cash Flow Statement dealt with by this Report are in agreement with the books of account and with the returns received from the division not visited by us.

e. In our opinion, the aforesaid Ind AS Financial Statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

f. 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 are disqualified as on March 31, 2023 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 Auditor''s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 20)1 -4, 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 tunanhial positionin iOs In d AS Financial State ments - Refer N ote 53 to the Ind AS Financial Statements.

ii. The Company has made provision, as required ueder the upplicable law or accounting standards, for material fureseeabie losses,ifany, on long-term contracts including derivative contracts.

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

iv. Further,

a. The management has represented that, to thh bes^s of⁷ its knowledge and beliof, no funds have been advan cred or l ta ntti or invested (either from borrowed funds ot share ktemium or any other sources or kind of⁷ funds) by the Company to or inany other petsont or entities, iccluding foreign entitios ("IntermeUiaries"), witn the understanAing, whether recorded in writing or otherwise, that the Intermediary shall:

• directly or indirectly lond

or invest in other persons orentities idontified id any manner whatsoever ("Ultimate Beneficiaries") by or on behalf of the. Company or

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

b. The mnnanement hto roprooented that,

to the best of its knowledge and belief, no funds have been received by the Company trom any ptrsons or entities, including toreign entiticu ("Funding Parties"), with the understa nding,

whether recorded it writing orothtrwise, that the Company shall:

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

mann er whatsoever ("Ulti mate BeneSiciaries") by or on behalf of the l^ndiog Patty or

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

c. &ased on the audit procedures that

have been consi dered teasuna ble and appropriate in t°e circumttances,not hing has come to our notice that has caused us to believe t h a 11 h e representations under sub-clause (i) and (ii) of Rule 11(e), as provided under (a) and (b) above, contain any material misstatement.

v. The Company has not declared or paid any dividend during the year.

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

In our opinion and according to the information and explanations given to us, the remuneration paid by the Company to its directors during the currentyear is in accordance with the provisions of⁷ Section 197 of the Act. The remuneration paid to any director is not in excess of the limit laid down under Section 197 of the Act. The Ministry of Corporate Affairs has not prescribed other details under Section 197(16) of the Act whiidn are requited to be commented upon toy, us.

vii. Proviso to Rule 3(1) kS the Companies (Accounts) Rules,4014for maintaining books of account using accounting software wkich hat a feature oo recording audrt trail (editlog) facility is applicable to ihe Company with effect froos Apnl 1,2023, and according, reporting under Rule 11(g) di Compan ies (Aud it and Auditors) Rules, 2d4 is not applicable for the financial year ended March St 1,2023.

For Jayesh Sanghrajka & Co. LLP

Chi artertd Accountants

ICAI Firm Rhgirtrahion Numoer: 104184W/W1000h5

Rishikesh Nasikkar

Designated faeftser

MembersMf, Numbet: 166493

UDIN: 23166493BG YARE8798

Place: Mumbai

Date: Muy 25, 2023

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Mar 31, 2018

Report on the Financial Statements

We have audited the accompanying financial statements of WALCHANDNAGAR INDUSTRIES LIMITED (“the Company”), which comprise the Balance Sheet as at March 31, 2018, and the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year then ended and a summary of the significant accounting policies and other explanatory information.

Management’s Responsibility for the Financial Statements

The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these 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 Indian Accounting Standards (Ind AS) prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, and other accounting principles generally accepted in India.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

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

In conducting 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 and the Order issued under section 143(11) of the Act.

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

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

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

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, of the state of affairs of the Company as at March 31, 2018, and its Loss, total comprehensive income, the changes in equity and its cash flows for the year ended on that date.

Emphasis of Matter

We draw attention to the following matter in Notes to Financial Statements:

a) Refer Note 54 regarding non-moving inventory of work-in-progress amounting to Rs. 2585 Lakhs on account of orders which have been cancelled/put on hold. The Company contends that this stock will either be liquidated or diverted to other projects without any loss arising therefrom.

Our report is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

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

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

b) in our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books and proper returns adequate for the purpose of our audit have been received from overseas divisions at Zambia and Ethiopia not visited by us. In case of Ethiopia, overseas Auditors’ Report has been forwarded to us and appropriately dealt with. In case of division at Zambia, since there were no operations on account of closure of site, the returns received from the division are unaudited.

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

d) in our opinion, the aforesaid financial statements comply with the Indian Accounting Standards prescribed under section 133 of the Act read with Rule 7 of the Companies (Accounts) Rules, 2014.

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

f) with respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure A”. 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 Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements. - Refer Note 50 to the financial statement.

ii. The Company has made provision, as required under the applicable law or accounting standards, 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.

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

ANNEXURE “A” TO THE INDEPENDENT AUDITOR’S REPORT

(Referred to in paragraph 1(f) under ‘Report on Other Legal and Regulatory Requirements’ section of our report to the Members of WALCHANDNAGAR INDUSTRIES LIMITED of even date)

Report on the Internal Financial Controls Over Financial Reporting under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)

We have audited the internal financial controls over financial reporting of WALCHANDNAGAR INDUSTRIES LIMITED (“the Company”) as of March 31, 2018 in conjunction with our audit of the financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

The Board of Directors of the Company 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. 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, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditor’s Responsibility

Our responsibility is to express an opinion on the internal financial controls over financial reporting of the Company 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”) issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls. 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 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 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 financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

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, to the best of our information and according to the explanations given to us, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2018, based on 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.

ANNEXURE ‘B’TO THE INDEPENDENT AUDITOR’S REPORT

(Referred to in paragraph 2 under ‘Report on Other Legal and Regulatory Requirements’ section of our report to the Members of WALCHANDNAGAR INDUSTRIES LIMITED of even date)

i. In respect of the Company’s fixed assets:

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

(b) The Company has a program of verification to cover all the items of fixed assets in a phased manner which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, certain fixed assets were physically verified by the management during the year. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

(c) According to the information and explanations given to us, the records examined by us and based on the examination of the conveyance deeds provided to us, we report that, the title deeds, comprising all the immovable properties of land and buildings which are freehold, are held in the name of the Company as at the balance sheet date except in respect of land Survey Nos. 317/1B, 303 A/2 and 337 are not available.

ii. The Management has conducted physical verification of the inventory at reasonable intervals other than material lying with sub-contractors.

iii. 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. Therefore, clause 3 (iii) of the said Order is not applicable.

iv. In our opinion and according to the information and explanations given to us, the company doesn’t have any loans, investments, guarantee or security to which the provisions of section 185 and 186 of the Companies Act 2013 apply.

v. The Company has not accepted any deposits during the year to which the provisions of section 73 to 76 of the Companies Act, 2013 and Companies (Acceptance of deposits) Rules, 2014 apply. According to the information and explanation given to us no order has been received from Company Law Board, National Company Law Tribunal or Reserve Bank of India or any court or tribunal by the Company.

vi. We have broadly reviewed the cost records maintained by the Company specified by the Central Government under section 148(1) of the Companies Act, 2013 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.

vii. According to the information and explanations given to us, in respect of statutory dues:

(a) The Company has generally been regular in depositing undisputed statutory dues, including Provident Fund, Employees’ State Insurance, Income Tax, Sales Tax, Service Tax, Goods and Service Tax, Value Added Tax, Customs Duty, Excise Duty, Cess and other material statutory dues applicable to it with the appropriate authorities

(b) There were no undisputed amounts payable in respect of Provident Fund, Employees’ State Insurance, Income Tax, Sales Tax, Service Tax, Value Added Tax, Goods and Service Tax, Customs Duty, Excise Duty, Cess and other material statutory dues in arrears as at March 31, 2018 for a period of more than six months from the date they became payable.

(c) Details of dues of Income Tax, Sales Tax, Service Tax, Excise Duty and Value Added Tax which have not been deposited as at March 31,2018 on account of dispute are given below:

Name of the statute	Nature of Dues	Amt. In lakhs)	Period to which the amount relates	Forum where the dispute is pending
Central Excise Act, 1944	Denial of exemption availed under notification No. 6/2002 for supply of biomass based boilers	266.19 (Net of CENVAT reversal and payment)	June, 2001 to March, 2004	Supreme Court
Central Excise Act, 1944	Excise duty demand on bought out items supplied for centrifugals which have already suffered duty at manufacturers’ end.	188.95 (Net of CENVAT reversal and payment)	February 1990, to June 2017	Supreme Court/CESTAT Tribunal
Central Excise Act, 1944	Excise duty demand on bought out items supplied for centrifugals.	2.47	September, 2009 to January 2011	CESTAT, M u m ba i
Central Sales Tax,1956	The exemption from tax for transit sale under section 6(2) (b) is denied. Rs. 30 lakhs paid under protest	159.83	2005-06	Sales Tax (Appellate Tribunal), Mumbai
Maharashtra Vat Act,2002 / Central Sales Tax,1956	Demand due to difference in amount of “C” forms/ other miscellaneous	1,080.53	2013-14	Commissioner (Appeals), Sales Tax
Service Tax	Demand on value addition of bought out items, Rs. 28.76 lakhs paid under protest.	362.65	2006-10	CESTAT, Kolkata
Customs Act,1962	Demand due to customs valuation issues	64.50	July,2008 till date	Madras High Court, Chennai
Maharashtra Land Revenue Code	NA Tax (Rs. 20 lakhs paid under protest)	86.61	1982 to 2003	Tahasildar, Indapur
	NATax	16.18	1982 to 2003	Tahasildar, Indapur
	NATax	58.58	1994 to 2003	Tahasildar, Indapur
Pune Municipal Corporation	Municipal Taxes-Determination of Annual Rateable Value	89.32	2008-09 to 2016-17	Court of Small Causes, Pune
Employees Provident Fund	EPF-Demand from EPF authorities	50.68	2006-07	Mumbai High Court

viii. There are no loans or borrowings from Government. To the best of our knowledge and according to the information and explanations given to us, except following delays, the Company has not defaulted in repayment of any loans or borrowings from financial institutions, banks and to debenture holders.

Lender’s Name	Period of Delay	Amount-Rs. in lakhs	Due on	Actual payment date
State Bank of India	3	200.00	31-Mar-17	3-Apr-17
Bank of India	78	175.00	30-Jun-17	16-Sep-17

ix. The Company has not raised moneys by way of initial public offer or further public offer. However during the year, the company raised Rs. 57 crores through issue of Non-Convertible Debentures and Rs. 180 crores through Term Loan. To the best of our knowledge and according to the information and explanations given to us, the company has applied these monies for the purposes for which they are raised.

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

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

xii. The Company is not a Nidhi Company and hence reporting under clause 3 (xii) of the Order is not applicable to the Company.

xiii. In our opinion and according to the information and explanations given to us, the Company is in compliance with Section 177 and 188 of the Companies Act, 2013 where applicable, for all transactions with the related parties and the details of related party transactions have been disclosed in the financial statements as required by the applicable accounting standards.

xiv. During the year, the Company has not made any preferential allotment or private placement of shares or fully or partly paid convertible debentures and hence reporting under clause 3 (xiv) of the Order is not applicable to the Company.

xv. In our opinion and according to the information and explanations given to us, during the year the Company has not entered into any non-cash transactions with its Directors or persons connected to its directors and hence provisions of section 192 of the Companies Act, 2013 are not applicable to the Company.

xvi. The Company is not required to be registered under section 45-IA of the Reserve Bankof India Act, 1934.

For Jayesh Sanghrajka & Co. LLP

Chartered Accountants

ICAI Firm Registration Number: 104184W/W100075

Ashish Sheth

Place: Mumbai Designated Partner

Date: May 28,2018 Membership Number: 107162

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Mar 31, 2017

Report on the Financial Statements

We have audited the accompanying financial statements of Walchandnagar Industries Limited ("the Company"), which comprise the Balance Sheet as at March 31, 2017, 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 stated in Section 134(5) of the Companies Act, 2013 (''the Act'') with respect to the preparation and presentation 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 principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

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

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

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

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud and error. In making those risk assessments, the auditor considers internal financial control relevant to the Company''s preparation of the financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company''s Directors, as well as evaluating the overall presentation of the financial statements.

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

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, of the state of affairs of the Company as at March 31, 2017, and its loss and its cash flows for the year ended on that date.

Emphasis of Matter

We draw attention to

a) Note No. 14.1(a) to the Financial Statements regarding old Trade Receivables of Rs.716.32 Lakhs which are currently under arbitration/ litigation. Pending the ultimate outcome of these matters, which is presently unascertainable, no provision has been made in respect of these dues.

b) Note No. 14.1(c) to the Financial Statements regarding non current debtors which include dues of Rs.312.56 Lakhs from Govt. parties after completion of the projects which are considered good for recovery.

c) Note No. 16 to the Financial Statements regarding non moving inventory of work in progress amounting to Rs.2593.67 Lakhs on account of orders which have been cancelled/ put on hold. The Company contends that this stock will either be liquidated or diverted to other projects without any loss arising there from.

Our report is not qualified in respect of the above matters. 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 - Ministry of Corporate Affairs, in terms of sub-section (11) of section 143 of the Act, we give in the Annexure A, a statement on the matters specified in paragraphs 3 and 4 of the said Order.

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

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

(b) in our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books and proper returns adequate for the purpose of our audit have been received from divisions at Zambia and Ethiopia not visited by us. In case of Ethiopia, overseas Auditors'' Report has been forwarded to us and appropriately dealt with. In case of division at Zambia, as there are no significant operations on account of closure of site, the returns received from the branch are unaudited.

(c) the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account and with the returns from the divisions at Zambia and Ethiopia;

(d) In our opinion, the aforesaid financial statements comply with the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014;

(e) On the basis of the written representations received from the directors as on March 31, 2017 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2017 from being appointed as a director in terms of Section 164 (2) of the Act.,

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

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

i. The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note 34 to the financial statements;

ii. the Company has made provision, as required under the applicable law or accounting standards, 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 (IEPF) by the Company except in case of unclaimed redemption amount of preference shares amounting to Rs.1.44 Lakhs which is remaining to be transferred as at the end of the year. (Please refer Note No. 37 to the financial statements).

iv. The Company has provided requisite disclosures in the financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8^th November 2016 to 30^th December 2016. Based on audit procedures and relying on the management representation we report that the disclosures are in accordance with books of accounts maintained by the Company and as produced to us by the management - Refer note No.36.

(Referred to in paragraph 1 under the heading "Report on Other Legal and Regulatory Requirements" of our Report of even date on the financial statements for the year ended March 31, 2017 of Walchandnagar Industries Limited)

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

(b) The Company has a programme for physical verification of the fixed assets, which in our opinion is reasonable having regard to the nature of the business. Accordingly, the fixed assets have been physically verified by the Management at the end of the year and no material discrepancies were noticed on such verification.

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company except in respect of land survey Nos. 317/1B, 303 A/2 and 337 are not available.

(ii) The Management has conducted physical verification of the inventory at reasonable intervals other than material lying with sub-contractors, which have been confirmed by majority of them.

(iii) 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. Therefore, clause 3 (iii) of the said Order is not applicable.

(iv) In our opinion and according to the information and explanations given to us, the company doesn''t have any loans, investments, guarantee or security to which the provisions of section 185 and 186 of the Companies Act 2013 apply.

(v) The Company has not accepted any deposits during the year to which the provisions of section 73 to 76 of the Companies Act, 2013 and Companies (Acceptance of deposits) Rules, 2014 apply. According to the information and explanation given to us no order has been received from Company Law Board, National Company Law Tribunal or Reserve Bank of India or any court or tribunal by the Company.

(vi) We have broadly reviewed the cost records maintained by the Company specified by the Central Government under section 148(1) of the Companies Act, 2013 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.

(vii) (a) According to the information and explanations given to us and the records of the Company examined by us, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Employees'' State Insurance, Income Tax, Sales Tax, Service Tax, Custom Duty, Excise Duty, Value Added Tax, Cess and other material statutory dues to the extent applicable to it.

According to the information and explanations given to us, there are no undisputed outstanding dues in respect of the above items in arrears as at March 31, 2017 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, the disputed statutory dues on accounts of Income Tax, Sales Tax, Service Tax, Customs Duty, Excise Duty, Value Added Tax, Municipal Tax and Cess that have not been deposited on account of matters pending before appropriate authority are as follows:

Name of the Statute	Nature of Dues	Amount (Rs. in Lakhs)	Period to which the amount relates	Forum where dispute is pending
Central Excise Act, 1944	Denial of exemption availed under notification No. 6/2002, for supply of biomass based boilers.	266.19 (Net of CENVAT reversal and payment)	March, 2000 to March, 2004	CESTAT, Mumbai
Central Excise Act, 1944	Excise duty demand on bought out items supplied for centrifugals, which have already suffered duty at manufacturers end.	82.73 (Net of CENVAT reversal and payments)	June, 1983 to April, 2005	Supreme Court
Maharashtra Land Revenue Code	NA Tax (Rs. 20 Lakhs paid under protest)	86.61	1982 to 2003	Tahasildar, Indapur
	NA Tax	16.18	1982 to 2003	Tahasildar, Indapur
	NA Tax	58.58	1994 to 2003	Tahasildar, Indapur
Pune Municipal Corporation	Municipal Taxes -Determination of Annual Rateable Value	89.32	2008-09 to 2016-17	Court of Small Causes , Pune

Name of the Statute	Nature of Dues	Amount (Rs. in Lakhs)	Period to which the amount relates	Forum where dispute is pending
Central Sales Tax Act, 1956	The exemption from tax for transit sale under section 6(2) (b) is denied. Rs.30 Lakhs paid under protest.	159.83	2005-06	Sales Tax (Appellate Tribunal), Mumbai
Service Tax	Demand on value addition of bought out items. Rs.28.76 Lakhs paid under protest.	362.65	2006-10	CESTAT, Kolkata
Employees Provident Fund	EPF - Demand from EPF authorities	50.68	2006-07	Mumbai High Court
Central Excise Act, 1944	Excise Duty on bought out components supplied for Centrifugals	2.47	Sept-09 to Jan-11	CESTAT, Mumbai

(viii) There are no loans or borrowings payable to government or debenture holders. The Company has delayed in repayment of following dues to the banks and financial institutions during the year.

(Rs. In Lakhs)

Lenders name	Period of default days	Amount	Installment due on	Actual payment date
Bank Of India	77	175.00	31/03/2016	16/06/2016
Bank Of India	84	175.00	30/06/2016	22/09/2016
Bank Of India	62	175.00	30/09/2016	01/12/2016
Bank Of India	40	175.00	31/12/2016	09/02/2017
State Bank of India	03	200.00	31/03/2017	03/04/2017

(ix) The company has not raised money by way of Initial Public Offer or further public offer (including debt instruments) during the year. In respect of term loans taken by the Company, in our opinion and according to the information and explanations given to us, the same have been applied for the purposes for which they were raised.

(x) According to the information and explanations given to us, no material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the course of our audit.

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

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

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

(xiv) According to the information and explanations give to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.

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

(xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act 1934.

FOR, K. S. Aiyar & Co.,

Chartered Accountants

Firm''s Registration No.: 100186W

Satish K. Kelkar

Place: Mumbai Partner

Date: May 26, 2017. Membership No.: 38934

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Sep 30, 2014

We have audited the accompanying financial statements of Walchandnagar Industries Limited ("the Company"), which comprise the Balance Sheet as at September 30, 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

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub- section (3C) of section 211 of the Companies Act, 1956 ("the Act") which continue to applicable in respect of Section 133 of the Companies Act, 2013 in terms of General Circular 15/2013 dated September 13, 2013 of the Ministry of Corporate Affairs and in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and fair presentation of the financial statements that are free from material misstatement, whether due to fraud or error.

Auditor''s responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor''s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud and error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by 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 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 September 30, 2014;

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

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

Report on other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order"), as amended, issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

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

(b) in our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books and proper returns adequate for the purpose of our audit have been received from divisions at Zambia and Ethiopia not visited by us. The divisions'' overseas Auditors'' Reports have been forwarded to us and appropriately dealt with;

(c) the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account and with the audited returns from the divisions at Zambia and Ethiopia;

(d) in our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 read with the General Circular 15/2013 dated September 13, 2013 of the Ministry of Corporate Affairs in respect of Section 133 of the Companies Act, 2013; and

(e) on the basis of written representations received from the directors as on September 30, 2014, and taken on record by the Board of Directors, none of the directors is disqualified as on September 30, 2014, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

(Referred to in paragraph 1 under the heading "Report on Other Legal and Regulatory Requirements" of our Report of even date on the financial statements for the year ended September 30, 2014 of Walchandnagar Industries Limited)

(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.

(b) The Company has a programme for physical verification of the fixed assets, which in our opinion is reasonable having regard to the nature of the business. Accordingly, the fixed assets have been physically verified by the Management at the end of the year and no material discrepancies were noticed on such verification.

(c) The fixed assets disposed off during the year were not substantial. According to the information and explanations given to us, we are of the opinion that the disposal of the Fixed Assets has not affected the going concern status of the Company.

(ii) In respect of its inventories :

(a) The Management has conducted physical verification of the inventory at reasonable intervals other than material lying with sub-contractors, which have been confirmed by majority of them.

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

(c) The Company has maintained proper records of inventory and no material discrepancies were noticed on physical verification as compared to the book records.

(iii) The Company has not granted/ taken any secured or unsecured loans to/ from companies, firms or other parties covered in the Register maintained under section 301 of the Companies Act, 1956. Therefore, sub-clauses (b), (c),

(d) , (e), (f) and (g) of clause (iii) of the said Order are not applicable.

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

(v) (a) According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the registers maintained under section 301 of the Companies Act, 1956 and exceeding the value of Rs. 5 Lakhs in respect of any party during the year have been made at price which are reasonable having regard to prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of section 58A and 58AA and any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. As informed to us, no order has been passed by the Company Law Board, National Company Law Tribunal or Reserve Bank of India or any other court or any other tribunal.

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

(viii) 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.

(ix) (a) According to the information and explanations given to us and the records of the Company examined by us, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess and other material statutory dues applicable to it.

According to the information and explanations given to us, there are no undisputed outstanding dues in respect of the above items in arrears as at September 30, 2014 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, the disputed statutory dues on accounts

of Sales Tax, Income Tax, Customs Duty, Wealth Tax, Service Tax, Excise Duty, Municipal Tax and Cess that have not been deposited on account of matters pending before appropriate authority are as follows:

Name of the Nature of Amount Period to Statute Dues (Rsin Lakhs) which the amount relates

Central Denial of 266.19 March, Excise Act, exemption (Net of 2000 to 1944 availed under CENVAT March, notification reversal 2004 No. 6/2002, and for supply payment) of biomass sbased boilers.

Central Excise duty 82.73 June, 1983 Excise Act, demand (Net of to April, 1944 on bought CENVAT 2005 out items reversal supplied for and centrifugals, payments) which have already suffered duty at manufacturers end.

Maharashtra NA Tax (20 86.61 1982 to Land Lakhs paid 2003 Revenue under protest) Code

NA Tax 16.18 1982 to 2003

NA Tax 58.58 1994 to 2003

Pune Municipal 325.07 2008-09 to Municipal Taxes - 2011-12 Corporation Determination of Annual Rateable Value

Central Sales The 159.83 2005-06 Tax Act, exemption 1956 from tax for transit sale under section 6(2) (b)is denied. 30 Lakhs paid under protest).

Service Tax Demand on 362.65 2006-10 value addition of bought out items. 28.76 Lakhs paid under protest).

Employees EPF - Demand 50.68 2006-07 Provident from EPF Fund authorities

Central Excise Duty 2.47 Sept-09 to Excise Act, on bought out Jan-11 1944 components supplied for Centrifugals



Name of the Statue Forum where dispute is pending

Central Excise Act,1944 CESTAT, Mumbai

Central Excise Act,1944 Supreme Court

Maharashtra Land Revenue Code Collector of Pune

SDO, Baramati

SDO, Baramati

Pune Municipal Corporation Court of Small Causes , Pune

Central Sales Tax Act,1956 Joint Commissioner of Sales Tax (Appeal), Pune

Service Tax Employees Provident Fund CESTAT, Kolkata

Employees Provident Fund Mumbai High Court

Central Excise Act,1944 CESTAT, Mumbai

(x) The Company does not have any accumulated losses as at the end of the financial year.The Company has incurred cash losses in the financial year covered by our audit and in the immediately preceding financial year.

(xi) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to the financial institutions or banks or debenture holders during the year.

(xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion and according to the information and explanations given to us, the Company is not a chit fund or a nidhi/ mutual benefit fund/ society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the Company.

(xiv) In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly the provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the Company.

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

(xvi) In our opinion and according to the information and explanations given to us, the term loans taken by the Company have been applied for the purposes for which they were raised.

(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we are of the opinion that funds raised on short- term basis have not been used for long-term investment.

(xviii) According to the information and explanations given to us, during the period covered by our audit report, the Company has not made any preferential allotment of shares to the parties and companies covered under the register maintained under section 301 of the Companies Act, 1956.

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

(xx) According to the information and explanations given to us, during the period covered by our audit report, the Company has not raised any money by public issue.

(xxi) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For K. s. Aiyar & Co., Chartered Accountants Firm''s Registration No.: 100186W

satish K. Kelkar Place: Mumbai Partner Date: November 29, 2014 Membership No.: 38934

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Sep 30, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of Walchandnagar Industries Limited ("the Company"), which comprise the Balance Sheet as at September 30, 2013, 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

Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ("the Act") and in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and fair presentation of the financial statements that are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud and error. In making those risk assessments, the auditor considers internal control relevant to the Company''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by 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 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 September 30, 2013;

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

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

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

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

(b) in our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books and proper returns adequate for the purpose of our audit have been received from divisions at Zambia and Ethiopia not visited by us. The divisions'' overseas Auditors'' Reports have been forwarded to us and appropriately dealt with;

(c) the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account and with the audited returns from the divisions at Zambia and Ethiopia;

(d) i n our opinion, the Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956;

(e) on the basis of written representations received from the directors as on September 30, 2013, and taken on record by the Board of Directors, none of the directors is disqualified as on September 30, 2013, from being appointed as a director in terms of clause (g) of sub- section (1) of section 274 of the Companies Act, 1956.

annexure to the auditors'' report

(Referred to in paragraph 1 under the heading "Report on Other Legal and Regulatory Requirements" of our Report of even date on the financial statements for the year ended September 30, 2013 of Walchandnagar Industries Limited)

(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.

(b) The Company has a programme for physical verification of the fixed assets, which in our opinion is reasonable having regard to the nature of the business. Accordingly, the fixed assets have been physically verified by the Management at the end of the year and no material discrepancies were noticed on such verification.

(c) The fixed assets disposed of during the year were not substantial. According to the information and explanations given to us, we are of the opinion that the disposal of the Fixed Assets has not affected the going concern status of the Company.

(ii) In respect of its inventories:

(a) The Management has conducted physical verification of the inventory at reasonable intervals other than material lying with sub-contractors, which have been confirmed by majority of them.

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

(c) The Company has maintained proper records of inventory and no material discrepancies were noticed on physical verification as compared to the book records.

(iii) The Company has not granted/taken any secured or unsecured loans to/ from companies, firms or other parties covered in the Register maintained under section 301 of the Companies Act, 1956. Therefore, sub-clauses (b), (c), (d), (e), (f) and (g) of clause (iii) of the said Order are not applicable.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business with regard to the purchase of inventory and fixed assets and for sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls.

(v) (a) According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been so entered.

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

(vi) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of section 58A and 58AA and any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. As informed to us, no order has been passed by the Company Law Board, National Company Law Tribunal or Reserve Bank of India or any other court or any other tribunal.

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

(viii) 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.

(ix) (a) According to the information and explanations given to us and the records of the Company examined by us, the Company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees'' State Insurance, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess and other material statutory dues applicable to it. There are no undisputed outstanding dues in respect of the above items which are more than six months as at the balance sheet date.

(b) According to the information and explanations given to us, the disputed statutory dues on accounts of Sales Tax, Income Tax, Customs Duty, Wealth Tax, Service Tax, Excise Duty, Municipal Tax and Cess that have not been deposited on account of matters pending before appropriate authority are as follows:

Name Nature Amount Period to Forum of the of Dues (Rs. in which the where Statute Lakhs) amount dispute is relates pending

Central Denial of 266.19 March, CESTAT, Excise Act, exemption (Net of 2000 to Mumbai 1944 availed under CENVAT March, notification reversal 2004 No. 6/2002, and for supply of payment) biomass based boilers.

Central Excise duty 82.45 June, 1983 Supreme Excise Act, demand on (Net of to Court 1944 bought out CENVAT April, 2005 items supplied reversal for centrifugals, and which have payments) already suffered duty at manufacturers end.

Maharashtra NA Tax (Rs. 20 86.61 1982 to Collector Land lakhs paid 2003 of Pune Revenue under protest) Code

NA Tax 16.18 1982 to SDO, 2003 Baramati

NA Tax 58.58 1994 to SDO, 2003 Baramati

Pune Municipal 325.07 2008-09 Court of Municipal Taxes - to 2011-12 Small Corporation Determination Causes, of Annual Pune Rateable Value

Central Sales The exemption 159.83 2005-06 Joint Tax Act, 1956 from tax for Commissioner transit sale of Sales Tax under section (Appeal), 6(2)(b) is Pune denied. (Rs. 30 lakhs paid under protest).

Andhra VAT - Addition 475.53 Oct. 2009 to Appellate Pradesh of adhoc Sept. 2010 Dy. Value Added amount in Sales Commissioner Tax Act (CT), Secunderabad

Service Tax Demand on 362.65 2006-10 CESTAT, value addition Kolkata of bought out items. (Rs. 28.76 lakhs paid under protest).

Employees EPF - Demand 50.68 2006-07 Mumbai Provident from EPF High Court Fund authorities

(x) The Company does not have any accumulated losses as at the end of the financial year. The Company has incurred cash losses only in the financial year covered by our audit but has not incurred any cash loss in the immediately preceding financial year.

(xi) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to the financial institutions or banks or debenture holders during the year.

(xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion and according to the information and explanations given to us, the Company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the Company.

(xiv) In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly the provisions of clause 4(xiv) of the Companies (Auditor''s Report) Order, 2003 are not applicable to the Company.

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

(xvi) The term loans have been applied for the purposes for which they were raised.

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

(xviii) According to the information and explanations given to us during the period covered by our audit report, the Company has not made any preferential allotment of shares to the parties and companies covered under the register maintained under section 301 of the Companies Act, 1956.

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

(xx) According to the information and explanations given to us during the period covered by our audit report, the Company has not raised any money by public issue.

(xxi) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For K. S. Aiyar & Co.

Chartered Accountants

Firm''s Registration No. 100186W

By the hand of

Satish K. Kelkar

Place : Mumbai Partner

Date : November 27, 2013 Membership No. 38934

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Sep 30, 2010

We have audited the attached Balance Sheet of Walchandnagar Industries Limited, as at 30th September, 2010 and also the Profit and Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto, in which are incorporated the returns of the division at Zambia audited by overseas local auditors and relied on by us.

1. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditors Report) Order, 2003, as amended by the Companies (Auditors Report) (Amendment) Order, 2004, issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, 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:

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

(ii) In our opinion, proper books of account as required by law, have been kept by the Company so far as appears from our examination of those books and proper returns adequate for the purposes of our audit have been received from the division at Zambia not visited by us. The divisions overseas Auditors Report has been forwarded to us and appropriately dealt with;

(iii) The balance sheet, profit and loss account and cash flow statement dealt with by this report are in agreement with the books of account and with the audited returns from the division at Zambia;

(iv) In our opinion, the balance sheet, profit and loss account and cash flow statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956;

(v) On the basis of written representations received from the Directors, as on 30th September, 2010 and taken on record by the Board of Directors, we report that none of the Directors of the Company are disqualified as on 30th September, 2010, from being appointed as a Director, in terms of Clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956;

(vi) No provision has been made for the liability, if any, in respect of a Bank Guarantee invoked and encashed by a customer during the year amounting to Rs. 700 Lakhs shown under "Loans and Advances", and in respect of Rs. 744 Lakhs owed by the said customer appearing under "Sundry Debtors". The Company has disputed the customers claim for bank guarantee invocation and has initiated the arbitration proceedings as detailed in Note No. D-3(iii), Schedule "O" of "Notes to Accounts". Since the matter is under arbitration, we are unable to opine on the likelihood of the liability devolving on the Company and the consequent effect on its Profits and the Reserves and Surplus.

Subject to (vi) above, in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at 30th September, 2010;

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

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

ANNEXURE TO THE AUDITORS REPORT Referred to in paragraph 3 of our report of even date,

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

(b) The Company has a programme for physical verification of the Fixed Assets, which in our opinion is reasonable having regards to the nature of the business. Accordingly, the Fixed Assets have been physically verified by the management at the end of the year and no material discrepancies were noticed on such verification.

(c) The Fixed Assets disposed off during the year were not substantial. According to the information and explanation given to us; we are of the opinion that the disposal of the Fixed Assets has not affected the going concern status of the Company.

(ii) (a) The Management has conducted physical verification of the inventory at reasonable intervals other than material lying with sub-contractors, which have been substantially confirmed by them.

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

(c) The Company has maintained proper records of inventory and no material discrepancies were noticed on physical verification as compared to the book records.

(iii) (a) The Company has not granted/taken any secured or unsecured loans to/from Companies, Firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956. Therefore, sub-clauses (b), (c), (d), (e), (f) and (g) of (iii) of the said Order are not applicable.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal controls.

(v) (a) According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under Section 301 of the Companies Act, 1956 have been so entered.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the registers maintained under Section 301 of the Companies Act, 1956 and exceeding the value of Rs. 5 Lakhs in respect of any party during the year have been made at price which are reasonable having regard to prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Sections 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules , 1975 with regard to the deposits accepted from the public. As informed to us, no order has been passed by the Company Law Board, National Company Law Tribunal or Reserve Bank of India or any other court or any other tribunal.

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

(viii) According to the information and explanations given to us, the Central Government has not prescribed the maintenance of cost records under Section 209( I) (d) of the Companies Act, 1956.

(ix) (a) The Company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income-Tax, Sales-Tax, Wealth Tax, Service Tax, Custom Duty, Excise-Duty and Cess and other statutory dues applicable to it.

According to the information and explanations given to us, no undisputed amount payable in respect of Income-Tax, Wealth Tax, Service Tax, Sales-Tax, Custom Duty, Excise Duty and Cess were in arrears as at 30th September, 2010 for the period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, the disputed statutory dues on account of Sales Tax, Income-Tax, Customs Duty, Wealth Tax, Service Tax, Excise Duty and Cess that have not been deposited on account of matters pending before appropriate authority are as follows:

Name of Nature of Dues Amount Period to Forum the (Rs. in Lakhs) which the where Statute amount dispute is relates pending

Central Denial of 266.19 (Net March, CESTAT, Excise Act, exemption availed of CENVAT 2000 to Mumbai 1944 under notification reversal March, No. 6/2002, for and 2004 supply of biomass payment) based boilers

Central Excise duty demand 79.98 (Net June, CESTAT, Excise Act, on bought out of CENVAT 1983 to Mumbai 1944 items supplied reversal April, for centrifugals, and 2005 which has already payments) suffered duty at manufacturers end

Maharashtra N.A. Tax 66.61 1982 to Collector, Land 2003 Pune Revenue Code

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

(xi) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to the financial institutions or banks or debenture holders during the year.

(xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion and according to the information and explanations given to us, the Company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

(xiv) In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly the provisions of clause 4(xiv) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

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

(xvi) The term loans have been applied for the purpose for which they were raised.

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

(xviii) According to the information and explanations given to us during the period covered by our audit report, the Company has not made any preferential allotment of shares to the parties and companies covered under the register maintained u/s. 301 of the Companies Act, 1956.

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

xx) According to the information and explanations given to us during the period covered by our audit report, the Company has not raised any money by public Issue.

(xxi) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For K. S. Aiyar & Co.

Chartered Accountants

FRN 100186W

Satish K. Kelkar

Place : Mumbai Partner

Date : 22nd November, 2010 Membership No. 38934

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Sep 30, 2009

We have audited the attached Balance Sheet of Walchandnagar Industries Limited, as at 30th September, 2009 and also the Profit and Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto, in which are incorporated the returns of the division at Zambia audited by overseas local auditors and relied on by us.

1. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditors Report) Order, 2003, as amended by the Companies (Auditors Report) (Amendment) Order, 2004, issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, 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:

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

(ii) In our opinion, proper books of account as required by law, have been kept by the Company so far as appears from our examination of those books and proper returns adequate for the purposes of our audit have been received from the division at Zambia not visited by us. The divisions overseas Auditors Report has been forwarded to us and appropriately dealt with;

(iii) The balance sheet, profit and loss account and cash flow statement dealt with by this report are in agreement with the books of account and with the audited returns from the division at Zambia;

(iv) In our opinion, the balance sheet, profit and loss account and cash flow statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956;

(v) On the basis of written representations received from the Directors, as on 30th September, 2009 and taken on record by the Board of Directors, we report that none of the Directors of the Company are disqualified as on 30th September, 2009, from being appointed as a Director, in terms of Clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956;

(vi) As stated in our earlier years audit report, no provision has been made for the liability, if any, in respect of the Bank Guarantee invoked by the parties in earlier years, as explained in the Note No. D-4 (iii) (a) and lb) of the Schedule 0 Since the matter is sub-judice we are unable to opine on the likelihood of these liabilities devolving on the Company and the consequent effect on Profit and the Reserves and Surplus.

Subject to (vi) above, in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) in the case of the Balance Sheet, of the state of affairs of the Company as at 30th September, 2009;

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

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

ANNEXURE TO THE AUDITORS REPORT

Referred to in paragraph 3 of our report of even date,

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

(b) The Company has a programme for physical verification of the Fixed Assets, which in our opinion is reasonable having regards to the nature of the business. Accordingly, the Fixed Assets have been physically verified by the management at the end of the year and no material discrepancies were noticed on such verification.

(c) The Fixed Assets disposed off during the year were not substantial. According to the information and explanation given to us; we are of the opinion that the disposal of the Fixed Assets has not affected the going concern status of the Company.

(ii) (a) The Management has conducted physical verification of the inventory at reasonable intervals other than material lying with sub-contractors, which have been substantially confirmed by them.

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

(c) The Company has maintained proper records of inventory and no material discrepancies were noticed on physical verification as compared to the book records.

(iii) (a) The Company has not granted/taken any secured or unsecured loans to/from Companies, Firms or other parties covered in the Register maintained under Section 301 of the Companies Act, 1956. Therefore, sub-clauses (b), (c), (d), (e), (f) and (g) of (iii) of the said Order are not applicable.

(iv) In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with the size of the Company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to " sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weakness in internal controls.

(v) (a) According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under Section 301 of the Companies Act, 1956 have been so entered. (b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the registers maintained under Section 301 of the Companies Act, 1956 and exceeding the value of Rs. Five Lakhs m tespett of any party duimg the yeaT have been made at price which are reasonable having regard to prevailing market prices at the relevant time.

However, with regard to the Management Service Contract with a party, as service is of specialized nature it is not possible to ascertain the market price for the same.

(vi) In our opinion and according to the information and explanations given to us, the Company has complie with the provisions of Sections 58A and 58AA or any other relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. As informed to us, no order has been passed by the Compan Law Board, National Company Law Tribunal or Reserve Bank of India or any other court or any other tribunal.

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

(viii) According to the information and explanations given to us, the Central Government has not prescribed the maintenance of cost records under Section 209( I) (d) of the Companies Act, 1956.

(ix) (a) The Company is generally regular in depositing with appropriate authorities undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income-Tax, Sales-Tax, Wealth Tax, Service Tax, Custom Duty, Excise-Duty and Cess and other statutory dues applicable to it.

According to the information and explanations given to us, no undisputed amount payable in respect of Income-Tax, Wealth Tax, Service Tax, Sales-Tax, Custom Duty, Excise Duty and Cess were in arrears as at 30th September, 2009 for the period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, the disputed statutory dues on account of Sales Tax, Income-Tax, Customs Duty, Wealth Tax, Service Tax, Excise Duty and Cess that have not been deposited on account of matters pending before appropriate authority are as follows:

Name of Nature of Dues Amount Period to Forum the (Rs. in which the where Statute Lakhs) amount dispute is relates pending

Central Denial of 266.19 (Net March, CESTAT, Excise Act, exemption availed ofCENVAT 2000 to Mumbai 1944 under notification reversal March, No. 6/2002, for and 2004 supply of biomass payment) based boilers

Central Excise duty demand 61.36 (Net June, CESTAT, Excise Act, on bought out ofCENVAT 1983 to Mumbai 1944 items supplied reversal April, for centrifugals, and 2005 which has already payments) suffered duty at manufacturers end.

Maharashtra N.A. Tax 66.61 1982 to Tehsildar, Land 2003 Indapur Revenue

Code

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

(xi) In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to the financial institutions or banks or debenture holders during the year.

(xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion and according to the information and explanations given to us, the Company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

(xiv) In our opinion and according to the information and explanations given to us, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly the provisions of clause 4 (xiv) of the Companies (Auditors Report) Order, 2003 are not applicable to the Company.

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

(xvi) The term loans have been applied for the purpose for which they were raised.

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

(xviii) According to the information and explanations given to us during the period covered by our audit report, the Company has not made any preferential allotment of shares to the parties and companies covered under the register maintained u/s. 301 of the Companies Act, 1956.

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

xx) According to the information and explanations given to us during the period covered by our audit report, the Company has not raised any money by public Issue.

(xxi) According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit.

For K. S. Aiyar & Co. Chartered Accountants Satish K. Kelkar Place: Mumbai Partner Date: 25th November, 2009 Membership No. 38934