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Alok Industries Ltd.

BSE: 521070 Sector: Industrials
NSE: ALOKINDS ISIN Code: INE270A01029
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VOLUME 356254
52-Week high 35.80
52-Week low 14.35
P/E
Mkt Cap.(Rs cr) 7,820
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 15.80
CLOSE 15.90
VOLUME 356254
52-Week high 35.80
52-Week low 14.35
P/E
Mkt Cap.(Rs cr) 7,820
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Alok Industries Ltd. (ALOKINDS) - Auditors Report

Company auditors report

on Standalone Financial Statement

To the Members of Alok Industries Limited

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying standalone financial statements ofAlok Industries Limited ("the Company") which comprise the Balance sheet as atMarch 31 2022 the Statement of Profit and Loss including the statement of OtherComprehensive Income the Cash Flow Statement and the Statement of Changes in Equity forthe year then ended and notes to the standalone financial statements including a summaryof significant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to theexplanations given to us the aforesaid standalone financial statements give theinformation required by the Companies Act 2013 as amended ("the Act") in themanner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India of the state of affairs of the Company as at March31 2022 its loss including other comprehensive income its cash flows and the changes inequity for the year ended on that date.

Basis for Opinion

We conducted our audit ofthe standalone financial statements inaccordance with the Standards on Auditing (SAs) as specified under section 143(10) of theAct. Our responsibilities under those Standards are further described in the‘Auditor's Responsibilities for the Audit of the Standalone Financial Statements'section of our report. We are independent of the Company in accordance with the ‘Codeof Ethics' issued by the Institute of Chartered Accountants of India together with theethical requirements that are relevant to our audit of the financial statements under theprovisions of the Act and the Rules thereunder and we have fulfilled our other ethicalresponsibilities in accordance with these requirements and the Code of Ethics. We believethat the audit evidence we have obtained is sufficient and appropriate to provide a basisfor our audit opinion on the standalone financial statements.

Emphasis of Matter

We draw attention to Note 34 of the standalone financial statements inrespect of the resolution plan approved by the National Company Law Tribunal vide itsorder dated March 8 2019 under section 31(1) of the Insolvency and Bankruptcy Code 2016.The Company has accounted the assigned debt as per the aforesaid resolution plan at costoverriding the Indian Accounting Standards which would require the Company to recognizethe assigned debt at its fair value and accordingly the imputed interest cost over theperiod of the loan. Our opinion is not modified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that in our professional judgmentwere of most significance in our audit of the standalone financial statements for thefinancial year ended March 31 2022. These matters were addressed in the context of ouraudit of the standalone financial statements as a whole and in forming our opinionthereon and we do not provide a separate opinion on these matters. For each matter belowour description of how our audit addressed the matter is provided in that context.

We have determined the matters described below to be the key auditmatters to be communicated in our report. We have fulfilled the responsibilities describedin the Auditor's responsibilities for the audit of the standalone financial statementssection of our report including in relation to these matters. Accordingly our auditincluded the performance of procedures designed to respond to our assessment of the risksof material misstatement of the standalone financial statements. The results of our auditprocedures including the procedures performed to address the matters below provide thebasis for our audit opinion on the accompanying standalone financial statements.

Recoverability of loan given to wholly owned subsidiary

Key audit matters How our audit addressed the key audit matter
The Company had in earlier years given loan to Alok Infrastructure Limited (a wholly owned subsidiary of the Company or "AIL"). As at March 31 2022 the outstanding balance of loan is ' 1372.99 crores (gross of impairment allowance of ' 1190.87 crores). AIL does not have significant business operations and has made a loss of ' 12.50 crores for the year ended March 31 2022 and has accumulated losses of ' 1492.39 crores as on March 31 2022. Our audit procedures included and were not limited to the following:
• Obtained and read the audited financial statements of Alok Infrastructure Limited for the year ended March 31 2022.
• Performed inquiry procedures with auditor of Alok Infrastructure Limited and discussed the audit procedures performed by them on the valuation report issued by the external specialists in respect of the subsidiary's investment properties/ inventories.
To assess the recoverability of the outstanding loan the Company has considered the valuation of the AIL's investment properties / inventories performed by the subsidiary with the help of external valuation specialists and has accordingly assessed that there is no further provision required for the year ended March 31 2022.
• Assessed key valuation aspects of the investment properties / inventories of Alok Infrastructure Limited by engaging internal valuation specialists.
Considering the assumptions / judgment used in valuation under the sales comparison method of market approach / depreciation replacement cost method under cost approach the same has been considered as a key audit matter. Refer Note 6 of the standalone financial statements. • Assessed the disclosures made in the standalone financial statements.

Capitalization of property plant and equipment

In the earlier years prior to implementation of the NCLT approved resolution plan the Company was operating at a lower capacity utilization and overall maintenance activity at the plant was curtailed due to lack of working capital. Consequently many of the plant and machinery remained idle / non-functional and in most cases the machinery's operating speed was reduced resulting in lower efficiency and production. Our audit procedures included and were not limited to the following:
• Assessed the design and operating effectiveness of controls of the Company relating to capitalization of property plant and equipment (including capital work in progress).
• Assessed on test basis for samples selected that the recognition criteria under Ind AS 16 is met.
In the previous year the re-constituted Board of Directors had approved a business plan which also included capital expenditure to overhaul the plant and machinery at the Company's manufacturing locations. • Inquired with management on any significant variation (if any) between the approved capex budget in previous year with the actual expenditure incurred as at the balance sheet date.
• Assessed disclosures made in the standalone financial statements.
During the year ended March 31 2022 the Company has incurred expenditure of ' 114.99 crores largely related to purchase of spares to overhaul the existing plant and machinery in order to improve their efficiency and increase the capacity utilization. Further the Company has capitalised ' 8.81 crores out of the capital work in progress of the previous year.
Judgement is involved to ensure that the aforesaid expenditure meets the specific recognition criteria under Ind AS 16 ‘Property Plant and Equipment'.
Accordingly the same is considered as a key audit matter. Refer Note 2 4 and 32 of the standalone financial statements.

Recoverability of carrying value of property plant and equipment

In the previous year consequent to the business plan approved by the re-constituted Board of Directors of the Company the Company had through an external valuation specialist determined the value in use of property plant and equipment and recorded an impairment provision of ' 8264.22 crores in the books. Our audit procedures included and were not limited to the following:
• Obtained the revised cash flow projections as approved by the Board of Directors.
• Assessed the valuation methodology applied in determining the value in use. In making this assessment we evaluated the objectivity and independence of Company's external specialists involved in the process.
Based on recent business developments the Board has made required revisions to the business plan and has accordingly updated the value in use calculations using the discounted cash flow method with the help of an external valuation specialist. Based on the same the Company has determined there are no material adjustments
• Assessed key assumptions applied to arrive at the value in use by involving internal valuation specialists
required to the impairment allowance already recorded. The value in use is sensitive to changes in certain inputs / assumptions used for forecasting the discounted cash flow projections due to inherent uncertainty involved in these assumptions. Accordingly the same has been considered as a key audit matter.

Contingent liabilities

Key audit matters How our audit addressed the key audit matter
As at March 31 2022 the Company had the following matters where management has assessed the possibility of outflow of resources embodying economic benefits. Our audit procedures included and were not limited to the following:
• Obtained and read the long term gas supply agreement between the Company and GAIL India Limited.
a) Take or pay obligation under the long term gas sale agreement with GAIL India Limited. Refer Note 36 of financial statements. • Assessed the management's position through discussions with the in-house legal expert.
b) Tax liabilities with respect to open assessments for assessment years prior to the closing date as per the NCLT approved resolution plan. Refer Note 36 of financial statements. • Discussed with the management on the development in these matters during the year ended March 31 2022 along with obtaining underlying documentation for the same including communication with counterparties.
Management's judgement regarding recognition and measurement of provisions for these matters is inherently uncertain and might change over time as the outcomes of the litigations / discussions are determined.
• Examined the management assessment with respect to possibility of outflow of resources embodying economic benefits in relation to these matters including independent opinion obtained by the management by involving legal specialists.
Accordingly it has been considered as a key audit matter.
• Evaluated the objectivity and independence of the legal specialists.
• Reviewed the disclosures made in the financial statements in this regard.
• Obtained representation letter from the management on the assessment of these matters.

Other Information

The Company's Board of Directors is responsible for the otherinformation. The other information comprises the information included in the Board ofDirectors report management discussion and analysis section of the annual reportcorporate governance report and business responsibility report but does not include thestandalone financial statements and our auditor's report thereon.

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

In connection with our audit of the standalone financial statementsour responsibility is to read the other information and in doing so consider whethersuch other information is materially inconsistent with the financial statements or ourknowledge obtained in the audit or otherwise appears to be materially misstated. If basedon the work we have performed we conclude that there is a material misstatement of thisother information we are required to report that fact. We have nothing to report in thisregard.

Responsibilities of Management for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters statedin section 134(5) of the Act with respect to the preparation of these standalone financialstatements that give a true and fair view of the financial position financial performanceincluding other comprehensive income cash flows and changes in equity of the Company inaccordance with the accounting principles generally accepted in India including theIndian Accounting Standards (Ind AS) specified under section 133 of the Act read with theCompanies (Indian Accounting Standards) Rules 2015 as amended. This responsibility alsoincludes maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding of the assets of the Company and for preventing and detectingfrauds and other irregularities; selection and application of appropriate accountingpolicies; making judgments and estimates that are reasonable and prudent; and the designimplementation and maintenance of adequate internal financial controls that wereoperating effectively for ensuring the accuracy and completeness of the accountingrecords relevant to the preparation and presentation of the standalone financialstatements that give a true and fair view and are free from material misstatement whetherdue to fraud or error.

In preparing the standalone financial statements management isresponsible for assessing the Company's ability to continue as a going concerndisclosing as applicable matters related to going concern and using the going concernbasis of accounting unless management either intends to liquidate the Company or to ceaseoperations or has no realistic alternative but to do so.

Those Board of Directors are also responsible for overseeing theCompany's financial reporting process.

Auditor's Responsibilities for the Audit of the StandaloneFinancial Statements

Our objectives are to obtain reasonable assurance about whether thestandalone financial statements as a whole are free from material misstatement whetherdue 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 auditconducted in accordance with SAs will always detect a material misstatement when itexists. Misstatements can arise from fraud or error and are considered material ifindividually or in the aggregate they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these standalone financial statements.

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

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

• Obtain an understanding of internal control relevant to theaudit in order to design audit procedures that are appropriate in the circumstances. Undersection 143(3) (i) of the Act we are also responsible for expressing our opinion onwhether the Company has adequate internal financial controls with reference to financialstatements in place and the operating effectiveness of such controls.

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

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

• Evaluate the overall presentation structure and content of thestandalone financial statements including the disclosures and whether the standalonefinancial statements represent the underlying transactions and events in a manner thatachieves fair presentation.

We communicate with those charged with governance regarding amongother matters the planned scope and timing of the audit and significant audit findingsincluding any significant deficiencies in internal control that we identify during ouraudit.

We also provide those charged with governance with a statement that wehave complied with relevant ethical requirements regarding independence and tocommunicate with them all relationships and other matters that may reasonably be thoughtto bear on our independence and where applicable related safeguards.

From the matters communicated with those charged with governance wedetermine those matters that were of most significance in the audit of the standalonefinancial statements for the financial year ended March 31 2022 and are therefore the keyaudit matters. We describe these matters in our auditor's report unless law or regulationprecludes public disclosure about the matter or when in extremely rare circumstances wedetermine that a matter should not be communicated in our report because the adverseconsequences of doing so would reasonably be expected to outweigh the public interestbenefits of such communication.

Report on Other Legal and Regulatory Requirements

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

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

(a) We have sought and obtained all the information and explanationswhich to the best of our knowledge and belief were necessary for the purposes of ouraudit;

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

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

(d) In our opinion the aforesaid standalone financial statementscomply with the Accounting Standards specified under Section 133 of the Act read withCompanies (Indian Accounting Standards) Rules 2015 as amended;

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

(f) With respect to the adequacy of the internal financial controlswith reference to these standalone financial statements and the operating effectiveness ofsuch controls refer to our separate Report in "Annexure 2" to this report;

(g) In our opinion the managerial remuneration for the year endedMarch 31 2022 has been paid / provided by the Company to its directors in accordance withthe provisions of section 197 read with Schedule V to the Act;

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

i. The Company has disclosed the impact of pending litigations on itsfinancial position in its standalone financial statements - Refer Note 36 to thestandalone financial statements;

ii. The Company has made provision as required under the applicablelaw or accounting standards for material foreseeable losses if any on long-termcontracts including derivative contracts.

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

iv. a) The management has represented that to the best of itsknowledge and belief as disclosed in Note 51 to the standalone financial statements nofunds have been advanced or loaned or invested (either from borrowed funds or sharepremium or any other sources or kind of funds) by the Company to or in any other person orentity including foreign entities ("Intermediaries") with the understandingwhether recorded in writing or otherwise that the Intermediary shall whether directlyor indirectly lend or invest in other persons or entities identified in any mannerwhatsoever by or on behalf of the Company ("Ultimate Beneficiaries") or provideany guarantee security or the like on behalf of the Ultimate Beneficiaries;

b) The management has represented that to the best of its knowledgeand belief as disclosed in Note 51 to the standalone financial statements no funds havebeen received by the Company from any person or entity including foreign entities("Funding Parties") with the understanding whether recorded in writing orotherwise that the Company shall whether directly or indirectly lend or invest inother persons or entities identified in any manner whatsoever by or on behalf of theFunding Party ("Ultimate Beneficiaries") or provide any guarantee security orthe like on behalf of the Ultimate Beneficiaries; and

c) Based on such audit procedures that were considered reasonable andappropriate in the circumstances nothing has come to our notice that has caused us tobelieve that the representations under subclause (a) and (b) contain any materialmisstatement.

v. No dividend has been declared or paid during the year by theCompany.

For S R B C & CO LLP

Chartered Accountants

ICAI Firm Registration Number: 324982E/E300003

per Pramod Kumar Bapna

Partner

Membership Number: 105497

UDIN: 22105497AHAWZD7077

Place: Mumbai

Date: April 14 2022

ANNEXURE1 to the Independent Auditor's Report of even date on the

Standalone Financial Statements of Alok Industries Limited

(Referred to in paragraph 1 under ‘Report on Other Legal andRegulatory Requirements' section of our Report of even date)

In terms of the information and explanations sought by us and given bythe Company and the books of account and records examined by us in the normal course ofaudit and to the best of our knowledge and belief we state that:

(i) (a) (A) The Company has maintained proper records showing fullparticulars including quantitative details and situation of Property Plant andEquipment.

(a) (B) The Company has maintained proper records showing fullparticulars of intangible assets.

(b) Property Plant and Equipment have been physically verified by themanagement during the year in accordance with a planned programme of verifying them oncein three years which is reasonable having regard to the size of the Company and the natureof its assets and no material discrepancies were identified on such verification.

(c) According to the information and explanations given by themanagement and audit procedures performed by us the title deeds of immovable propertiesincluded in property plant and equipment and investment properties are held in the nameof the Company except in the case of certain immovable properties (gross block of ' 22.27crores) where the transfer of name shall be done post conversion of the land to‘Non-agricultural'.

(d) The Company has not revalued its Property Plant and Equipment(including Right of use assets) or intangible assets during the year ended March 31 2022.

(e) There are no proceedings initiated or are pending against theCompany for holding any benami property under the Prohibition of Benami PropertyTransactions Act 1988 and rules made thereunder.

(ii) (a) The inventory has been physically verified by the managementduring the year except for inventories lying with third parties. In our opinion thefrequency of verification by the management is reasonable and the coverage and procedurefor such verification is appropriate. Discrepancies of 10% or more in aggregate for eachclass of inventory were not noticed on such physical verification. Inventories lying withthird parties have been confirmed by them as at year end and discrepancies of 10% or morein aggregate for each class of inventory were not noticed in respect of suchconfirmations.

(b) As disclosed in Note 19 to the financial statements the Companyhas been sanctioned working capital limits in excess of Rs. five crores in aggregate frombanks during the year on the basis of security of current assets of the Company. Thequarterly returns/statements filed by the Company with such banks are in agreement withthe books of account of the Company.

(iii) (a) During the year the Company has not provided loans advancesin the nature of loans stood guarantee or provided security to companies firms LimitedLiability Partnerships or any other parties. Accordingly the requirement to report onclause 3(iii)(a) of the Order is not applicable to the Company.

(b) During the year the Company has not made investments providedguarantees provided security and granted loans and advances in the nature of loans tocompanies firms Limited Liability Partnerships or any other parties. Accordingly therequirement to report on clause 3(iii)(b) of the Order is not applicable to the Company.

(c) The Company has in earlier years granted loans to a wholly ownedsubsidiary amounting to ' 1372.99 crores (on which impairment allowance of ' 1190.87crores has been made as at March 31 2022) in respect of which the schedule of repaymentof principal has been stipulated and the repayment is not due. As per the agreement theloan has been given interest free. Further the Company has in earlier years granted loansto companies of ' 1465.99 crores (on which impairment allowance of ' 1465.99 crores hasbeen made as at March 31 2022) where the schedule of repayment of principal and paymentof interest has not been stipulated. Accordingly we are unable to make a specific commenton clause 3(iii)(c) on the regularity of repayment of principal and payment of interest inrespect of such loans.

(d) The Company has in earlier years granted loans to a wholly ownedsubsidiary amounting to ' 1372.99 crores (on which impairment allowance of ' 1190.87crores has been made as at March 31 2022) in respect of which there are no amountsoverdue for more than 90 days. Further the Company has in earlier years granted loans tocompanies of ' 1465.99 crores (on which impairment allowance of ' 1465.99 crores hasbeen made as at March 31 2022) where the schedule of repayment of principal and paymentof interest has not been stipulated. Accordingly we are unable to make a specific commenton clause 3(iii)(d) on amounts overdue for more than 90 days and whether reasonable stepshave been taken by the Company for recovery of the principal and interest in respect ofsuch loans.

(e) The Company has in earlier years granted loans to a wholly ownedsubsidiary amounting to ' 1372.99 crores (on which impairment allowance of ' 1190.87crores has been made as at March 31 2022) in respect of which the loan has not fallendue during the year. Further the Company has in earlier years granted loans to companiesof ' 1465.99 crores (on which impairment allowance of ' 1465.99 crores has been made asat March 31 2022) where the schedule of repayment of principal and payment of interesthas not been stipulated. Accordingly in respect of such loans we are unable to make aspecific comment on clause 3(iii)(e) on whether loans granted to companies have fallen dueduring the year. However during the year the Company has not renewed or extended anyloans or granted fresh loans to settle overdues of existing loans given to the sameparties.

(f) During the year the Company has not granted any loans or advancesin the nature of loans either repayable on demand or without specifying any terms orperiod of repayment to companies firms Limited Liability Partnerships or any otherparties. Accordingly the requirement to report on clause 3(iii)(f) of the Order is notapplicable to the Company.

(iv) The Company had granted interest free loan in earlier years (priorto corporate insolvency resolution process) to a company which is outstanding as at theyear- end amounting to ' 233.32 crores (against which an impairment allowance of ' 233.32crores is made). Further the Company had granted interest free loan in earlier years(prior to the corporate insolvency resolution process) to its wholly owned subsidiaries(‘WOS') which are outstanding as at the year-end amounting to ' 2605.66 crores(against which an impairment allowance of ' 2423.54 crores is made). In our opinion andaccording to the information and explanations given to us provisions of section 185 and186 of the Companies Act 2013 in respect of loans to directors including entities inwhich they are interested and in respect of loans and advances given investments madeand guarantees and securities given have been complied with by the Company consideringthe legal opinion obtained by the Company according to which the provisions of section 186of the Companies Act 2013 are not applicable to all such interest free loans grantedunder the erstwhile Companies Act 1956 and by virtue of the resolution plan approved bythe NCLT any claim from the authorities with respect to the breach / contravention /non-compliance of any Applicable law is abated settled and extinguished as at the closingdate (i.e. September 14 2020).

(v) The Company has neither accepted any deposits from the public noraccepted any amounts which are deemed to be deposits within the meaning of sections 73 to76 of the Companies Act and the rules made thereunder to the extent applicable.Accordingly the requirement to report on clause 3(v) of the Order is not applicable tothe Company.

(vi) We have broadly reviewed the books of account maintained by theCompany pursuant to the rules made by the Central Government for the maintenance of costrecords under section 148(1) of the Companies Act 2013 related to the manufacture ofcertain textile products and are of the opinion that prima facie the specified accountsand records have been made and maintained. We have not however made a detailedexamination of the same.

(vii) (a) The Company is regular in depositing with the

appropriate authorities undisputed statutory dues including providentfund employees' state insurance income-tax duty of custom goods and service tax cessand other statutory dues applicable to it.

(b) According to the information and explanations given to us and auditprocedures performed by us there are no undisputed amounts payable in respect ofprovident fund employees' state insurance income-tax goods and services tax duty ofcustom cess and other statutory dues which were outstanding at the year end for aperiod of more than six months from the date they became payable.

(c) There are no dues in respect of income tax sales tax service taxgoods and services tax duty of customs duty of excise and value added tax that have notbeen deposited with the appropriate authorities on account of any dispute read with Note36 to the standalone financial statements relating to NCLT approved resolution plan.

(viii) The Company has not surrendered or disclosed any transactionpreviously unrecorded in the books of account in the tax assessments under the Income TaxAct 1961 as income during the year. Accordingly the requirement to report on clause3(viii) of the Order is not applicable to the Company.

(ix) (a) The Company has not defaulted in repayment of loans or otherborrowings or in the payment of interest thereon to any lender.

(b) The Company has not been declared wilful defaulter by any bank orfinancial institution or government or any government authority.

(c) Term loans were applied for the purpose for which the loans wereobtained.

(d) On an overall examination of the financial statements of theCompany no funds raised on short-term basis have been used for long-term purposes by theCompany.

(e) On an overall examination ofthe financial statements of theCompany the Company has not taken any funds from any entity or person on account of or tomeet the obligations of its subsidiaries and joint ventures.

(f) The Company has not raised loans during the year on the pledge ofsecurities held in its subsidiaries and joint ventures. Hence the requirement to reporton clause (ix)(f) of the Order is not applicable to the Company.

(x) (a) The Company has not raised any money during the year by way ofinitial public offer / further public offer (including debt instruments) hence therequirement to report on clause 3(x)(a) of the Order is not applicable to the Company.

(b) The Company has not made any preferential allotment or privateplacement of fully or partly convertible debentures during the year under review.According to the information and explanations given by the management and overallexamination of the balance sheet the unutilized amount of ' 150 crores as at April 12021 raised by way of preferential allotment of equity and optionally convertiblepreference shares in the previous year has been utilized for capital expenditure andmeeting working capital requirements during the year.

(xi) (a) Based upon the audit procedures performed for the purpose ofreporting the true and fair view of the financial statements and according to theinformation and explanations given by the management we report that no fraud by theCompany or no material fraud on the Company has been noticed or reported during the year.

(b) During the year no report under sub-section (12) of section 143 ofthe Companies Act 2013 has been filed by cost auditor/secretarial auditor or by us inForm ADT - 4 as prescribed under Rule 13 of Companies (Audit and Auditors) Rules 2014with the Central Government.

(c) As represented to us by the management there are no whistle blowercomplaints received by the Company during the year.

(xii) In our opinion the Company is not a nidhi company as per theprovisions of the Companies Act 2013. Therefore the requirement to report on clause3(xii) of the Order is not applicable to the Company.

(xiii) Transactions with the related parties are in compliance withsections 177 and 188 of Companies Act 2013 where applicable and the details have beendisclosed in the notes to the financial statements as required by the applicableaccounting standards.

(xiv) (a) The Company has an internal audit system commensurate withthe size and nature of its business.

(b) The internal audit reports of the Company issued till the date ofthe audit report for the period under audit have been considered by us.

(xv) The Company has not entered into any non-cash transactions withits directors or persons connected with its directors and hence requirement to report onclause 3(xv) of the Order is not applicable to the Company.

(xvi) (a) According to the information and explanation given by themanagement the provisions of section 45-IA of the Reserve Bank of India Act 1934 (2 of1934) are not applicable to the Company. Accordingly the requirement to report on clause(xvi)(a) of the Order is not applicable to the Company.

(b) The Company has not conducted any Non-Banking Financial or HousingFinance activities without obtained a valid Certificate of Registration (CoR) from theReserve Bank of India as per the Reserve Bank of India Act 1934.

(c) The Company is not a Core Investment Company as defined in theregulations made by Reserve Bank of India. Accordingly the requirement to report onclause 3(xvi)(c) of the Order is not applicable to the Company.

(d) There is no Core Investment Company as a part of the Group hencethe requirement to report on clause 3(xvi)(d) of the Order is not applicable to theCompany.

(xvii) The Company has not incurred cash losses in the currentfinancial year and has incurred cash losses of ' 72.62 crores in the immediately precedingfinancial year.

(xviii) There has been no resignation of the statutory auditors duringthe year and accordingly requirement to report on Clause 3(xviii) of the Order is notapplicable to the Company.

(xix) On the basis of the financial ratios disclosed in Note 53 to thefinancial statements ageing and expected dates of realization of financial assets andpayment of financial liabilities other information accompanying the financial statementsour knowledge of the Board of Directors and management plans and based on our examinationof the evidence supporting the assumptions nothing has come to our attention whichcauses us to believe that any material uncertainty exists as on the date of the auditreport that Company is not capable of meeting its liabilities existing at the date ofbalance sheet as and when they fall due within a period of one year from the balance sheetdate. We however state that this is not an assurance as to the future viability of theCompany. We further state that our reporting is based on the facts up to the date of theaudit report and we neither give any guarantee nor any assurance that all liabilitiesfalling due within a period of one year from the balance sheet date will get dischargedby the Company as and when they fall due.

(xx) (a) In respect of other than ongoing projects there are nounspent amounts that are required to be transferred to a fund specified in Schedule VII ofthe Companies Act (the Act) in compliance with second proviso to sub section (5) ofsection 135 of the Act. This matter has been disclosed in Note 48 to the financialstatements.

(b) There are no unspent amounts in respect of ongoing projects thatare required to be transferred to a special account in compliance of provision of subsection (6) of section 135 of Companies Act.

This matter has been disclosed in Note 48 to the financial statements.

For S R B C & CO LLP

Chartered Accountants

ICAI Firm Registration Number: 324982E/E300003

per Pramod Kumar Bapna

Partner

Membership No.: 105497

UDIN: 22105497AHAWZD7077

Place : Mumbai

Date: April 14 2022

ANNEXURE2 to the Independent Auditor's Report of even date on the

Standalone Financial Statements of Alok Industries Limited

Report on the Internal Financial Controls under Clause (i) ofSub-section 3 of Section 143 of the Companies Act 2013 ("the Act")

We have audited the internal financial controls with reference tostandalone financial statements of Alok Industries Limited ("the Company") as ofMarch 31 2022 in conjunction with our audit of the standalone financial statements of theCompany for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's Management is responsible for establishing andmaintaining internal financial controls based on the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note on Audit of Internal Financial Controls OverFinancial Reporting issued by the Institute of Chartered Accountants of India("ICAI"). These responsibilities include the design implementation andmaintenance of adequate internal financial controls that were operating effectively forensuring the orderly and efficient conduct of its business including adherence to theCompany's policies the safeguarding of its assets the prevention and detection offrauds and errors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Companies Act 2013..

Auditor's Responsibility

Our responsibility is to express an opinion on the Company'sinternal financial controls with reference to these standalone financial statements basedon our audit. We conducted our audit in accordance with the Guidance Note on Audit ofInternal Financial Controls Over Financial Reporting (the "Guidance Note") andthe Standards on Auditing as specified under section 143(10) of the Act to the extentapplicable to an audit of internal financial controls both issued by ICAI. ThoseStandards and the Guidance Note require that we comply with ethical requirements and planand perform the audit to obtain reasonable assurance about whether adequate internalfinancial controls with reference to these standalone financial statements was establishedand maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence aboutthe adequacy of the internal financial controls with reference to these standalonefinancial statements and their operating effectiveness. Our audit of internal financialcontrols with reference to standalone financial statements included obtaining anunderstanding of internal financial controls with reference to these standalone financialstatements assessing the risk that a material weakness exists and testing and evaluatingthe design and operating effectiveness of internal control based on the assessed risk. Theprocedures selected depend on the auditor's judgement including the assessment ofthe risks of material misstatement of the financial statements whether due to fraud orerror.

We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the Company's internalfinancial controls with reference to these standalone financial statements.

Meaning of Internal Financial Controls With Reference to theseStandalone Financial Statements

A company's internal financial controls with reference tostandalone financial statements is a process designed to provide reasonable assuranceregarding the reliability of financial reporting and the preparation of financialstatements for external purposes in accordance with generally accepted accountingprinciples. A company's internal financial controls with reference to standalonefinancial statements includes those policies and procedures that (1) pertain to themaintenance of records that in reasonable detail accurately and fairly reflect thetransactions and dispositions of the assets of the company; (2) provide reasonableassurance that transactions are recorded as necessary to permit preparation of financialstatements in accordance with generally accepted accounting principles and that receiptsand expenditures of the company are being made only in accordance with authorisations ofmanagement and directors of the company; and (3) provide reasonable assurance regardingprevention or timely detection of unauthorised acquisition use or disposition of thecompany's assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over FinancialReporting with Reference to these Standalone Financial Statements

Because of the inherent limitations of internal financial controls withreference to standalone financial statements including the possibility of collusion orimproper management override of controls material misstatements due to error or fraud mayoccur and not be detected. Also projections of any evaluation of the internal financialcontrols with reference to standalone financial statements to future periods are subjectto the risk that the internal financial control with reference to standalone financialstatements may become inadequate because of changes in conditions or that the degree ofcompliance with the policies or procedures may deteriorate.

Opinion

In our opinion the Company has in all material respects adequateinternal financial controls with reference to standalone financial statements and suchinternal financial controls with reference to standalone financial statements wereoperating effectively as at March 31 2022 based on the internal control over financialreporting criteria established by the Company considering the essential components ofinternal control stated in the Guidance Note issued by the ICAI.

For S R B C & CO LLP

Chartered Accountants

ICAI Firm Registration Number: 324982E/E300003

per Pramod Kumar Bapna

Partner

Membership No.: 105497

UDIN: 22105497AHAWZD7077

Place : Mumbai

Date: : April 14 2022

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