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Camlin Fine Sciences Ltd.

BSE: 532834 Sector: Industrials
NSE: CAMLINFINE ISIN Code: INE052I01032
BSE 00:00 | 26 Feb 134.75 5.85
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NSE 00:00 | 26 Feb 134.70 5.70
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OPEN 125.00
PREVIOUS CLOSE 128.90
VOLUME 227363
52-Week high 139.90
52-Week low 33.40
P/E 74.45
Mkt Cap.(Rs cr) 1,718
Buy Price 133.75
Buy Qty 100.00
Sell Price 134.75
Sell Qty 820.00
OPEN 125.00
CLOSE 128.90
VOLUME 227363
52-Week high 139.90
52-Week low 33.40
P/E 74.45
Mkt Cap.(Rs cr) 1,718
Buy Price 133.75
Buy Qty 100.00
Sell Price 134.75
Sell Qty 820.00

Camlin Fine Sciences Ltd. (CAMLINFINE) - Auditors Report

Company auditors report

TO

THE MEMBERS OF

CAMLIN FINE SCIENCES LIMITED

Report on the Audit of the Standalone Financial Statements

Opinion

We have audited the accompanying Standalone Financial Statements of CAMLIN FINESCIENCES LIMITED ("the Company") which comprise the Balance Sheet as atMarch 31 2020 and the Statement of Profit and Loss (including Other ComprehensiveIncome) the Statement of Changes in Equity and Statement of Cash Flows for the year thenended and notes to the Financial Statements including a summary of significantaccounting policies and other explanatory information (hereinafter referred to as"Standalone Financial Statements").

In our opinion and to the best of our information and according to the explanationsgiven to us the aforesaid Standalone Financial Statements give the information requiredby the Companies Act 2013 ("the Act") in the manner so required and give a trueand fair view in conformity with the accounting principles generally accepted in India ofthe state of affairs of the Company as at March 31 2020 and its profits OtherComprehensive Income changes in equity and its cash flows for the year ended on thatdate.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specifiedunder section 143(10) of the Act. Our responsibilities under those Standards are furtherdescribed in the Auditor's Responsibilities for the Audit of Standalone FinancialStatements section of our report. We are independent of the Company in accordance with theCode of 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 suffcient and appropriate to provide a basisfor our opinion.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the Standalone Financial Statements of the current period.These matters were addressed in the context of our audit of the Standalone FinancialStatements as a whole and in forming our opinion thereon and we do not provide aseparate opinion on these matters.

We have determined the matters described below to be the key audit matters to becommunicated in our report.

Key Audit Matter Description Our Response
Exposure in group entities
The exposure within the group entities i.e. carrying amount of the Parent Company's investments loans and advances trade & other receivables (net of payables) accounts for over 33% (March 31 2019: over 28%) of the total assets of the Company. We compared the carrying value of these investments loans and advances trade & other receivables and trade payables with the respective subsidiaries financial statements to identify whether their net assets were in excess of their carrying amount and assessed whether those subsidiaries have historically been profit-making.
Their recoverability is dependent on these group companies generating enough cash flows in future estimation of which requires significant management judgement. For those subsidiaries where carrying amount exceeds the net asset value of the respective subsidiaries we evaluated the relevant subsidiary's projected statement of profit and loss and projected statement of cash flows with management assumptions relating to key inputs such as projected long term growth and discount rates and assessing the managements assumptions over the recoverability of intercompany receivables against our own knowledge of the trading performance and net assets of the relevant counterparty.
We do not consider valuation of these investments and recovery of intercompany receivables payables to be at a high risk of significant misstatement. However due to their materiality in the context of the Company's financial statement this is considered to be the area that had a significant effect on the company audit. Assessed the appropriateness of the disclosure in the Standalone Financial Statements in accordance with the applicable financial reporting framework.
Refer Note 6(i) Note 13.1 Note 16.2 Note 17 and Note 26 read with Note 47(e) forming part of the notes to the Standalone Financial Statements. Our audit work in respect of the valuation of put option instrument included:
Valuation of Financial Instruments
The fair value of certain financial instruments is determined through the application of the valuation techniques which often involves the exercise of judgements by the Management and the use of assumptions. The estimation uncertainty can be high for those instruments where significant valuation inputs are unobservable (e.g. cash flow projections finance cost estimation market volatility forecast of operational estimates etc). Obtained an understanding of the determination of fair value of the option and assessed and tested the reasonableness of the significant judgements applied by the management.
In respect of valuation of complex financial instruments like the Foreign Currency Convertible Bonds (FCCBs) and the Put Option the Company has engaged expert(s) to carry out the valuation at its initial recognition and subsequently at each reporting date. Evaluating the contractual arrangement governing the option in the hands of the holders and ensuring that the management expert engaged to perform and compute the valuation has necessary expertise and knowledge to provide an acceptable value to the financial instrument. We have also reviewed the valuation report obtained by the Company from their expert for valuing the option.
The measurement of the Put Option valuation carried out by the external expert engaged by the management has considered certain factors such as projected EBITDA weighted average cost of capital probability of option being exercised etc. (Refer Note 27 on Put Option Liability forming part of the notes to the Standalone Financial Statements) and in case of FCCBs certain factors considered are finance cost and payment schedules being determined based on movement in equity share prices of the Company volatility of shares price over certain period and observable market input e.g. risk free rate currency swap rates etc (Refer Note 21) forming part of the notes to the Standalone Financial Statements). The fair value of the financial instruments in the given case is determined through the application of valuation techniques which involves making significant assumptions and the exercise of judgement. We have independently evaluated the assumptions made and factors considered in the valuation of the option.
Our audit work in respect of the valuation of foreign currency convertible bonds included:
We understood and assessed the models and methodology used for the valuation of the instruments measured at amortised cost as well as those which are designated at fair value through profit or loss both at the time of initial recognition and subsequent measurement on the reporting dates. Through a series of interaction and discussion with the valuation expert engaged by the management and assessing the appropriateness of various factors and their related assumptions such as share price and its volatility consideration of risk free rate borrowing rate of the company for a similar instrument with / without conversion features interest amount to be paid along with timing etc. used in the overall computation of the fair value we have drawn our comfort on the principles of recognition and measurement.
Assessed the appropriateness of the disclosure in the Standalone Financial Statements in accordance with the applicable financial reporting framework.

 

Capital Work-in-Progress in relation to Dahej Project
Identification of cost that is required to be capitalized requires management judgement. Inaccurate cost capitalization may result in amounts being capitalized that do not meet capitalization criteria and affects the accuracy of cost to be capitalized. Our audit procedures included testing the design implementation and operating effectiveness of controls in respect of cost of capital work in progress and intangible assets under development.
Refer Note 2(b) forming part of the notes to the Standalone Financial Statements and intangible assets under development. We assessed the nature of costs incurred in capital projects through testing of amounts recorded and considering whether the expenditure met the criteria for capitalization under accounting standards.
Income tax expenses / benefits We tested the source documentation to determine whether the expenditure is of capital nature and has been appropriately approved and properly segregated into appropriate categories.
Assessed the appropriateness of the disclosure in the Standalone Financial Statements in accordance with the applicable financial reporting framework.
The Company has extensive international operations and in the normal course of the business the Management makes significant judgements and estimates in relation to transfer pricing tax issues and in assessing tax exposures in each jurisdiction many of which require interpretation of local laws including amount expected to be paid/recovered for uncertain tax positions. Our procedures included:
An understanding of: the Company's tax strategy and transfer pricing policy; the methodology for the calculation of the tax charge particularly in relation to any changes implemented during the current financial year; and
Where the amount of tax payable is uncertain the Company establishes provisions based on management's judgement of the probable amount of liability. This is a key judgement on account of the Company operating in a number of varying tax jurisdictions the complexity of transfer pricing and other international tax legislations. management's controls over tax reporting.
Given this judgement there is a risk that tax provisions are misstated. We assessed the appropriateness of the tax provisions created by the Company and their use of estimates and judgements by involving our in house tax specialist team having discussions with the Company's management assessedrecentpronouncementsaffectingthemethodology for calculation of tax charge and copies of external tax advice reports related to tax treatments applied and the corresponding provisions recorded. We have also evaluated whether the liabilities and potential exposures were appropriately disclosed in the Standalone Financial Statements.

Other Information

The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Annual Report namely FinancialHighlights Directors' Report Management Discussion and Analysis Report on CorporateGovernance and Business Responsibility Report but does not include the StandaloneFinancial Statements and our auditor's report thereon. The other information is expectedto be made available to us after the date of this auditor's report.

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

In connection with our audit of the Standalone Financial Statements our responsibilityis to read the other information identified above when it becomes available and in doingso consider whether the other information is materially inconsistent with the StandaloneFinancial Statements or our knowledge obtained in the audit or otherwise appears to bematerially misstated.

When we read the other information if we conclude that there is material misstatementtherein we are required to communicate the matter to those charged with governance andreview the steps taken by the management to communicate to those in receipt of the otherinformation if previously issued to inform them of the revision.

Responsibilities of Management and Those Charged with Governance for the StandaloneFinancial Statements

The Company's Board of Directors is responsible for the matters stated in section134(5) of the Act with respect to the preparation of these Standalone Financial Statementsthat give a true and fair view of the financial position financial performance (includingother comprehensive income) changes in equity and cash flows of the Company in accordancewith the accounting principles generally accepted in India including the IndianAccounting Standards (Ind AS) specified under section 133 of the Act. This responsibilityalso includes maintenance of adequate accounting records in accordance with the provisionsof the 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 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 FinancialStatement 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 is responsible forassessing the Company's ability to continue as a going concern disclosing as applicablematters related to going concern and using the going concern basis of accounting unlessmanagement either intends to liquidate the Company or to cease operations or has norealistic alternative but to do so.

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

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

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

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

(a) Identify and assess the risks of material misstatement of the Standalone FinancialStatements whether due to fraud or error design and perform audit procedures responsiveto those risks and obtain audit evidence that is suffcient and appropriate to provide abasis for our opinion. The risk of not detecting a material misstatement resulting fromfraud is higher than for one resulting from error as fraud may involve collusionforgery intentional omissions misrepresentations or the override of internal control.

(b) Obtain an understanding of internal control relevant to the audit in order todesign 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 companyhas adequate internal financial controls system with reference to Standalone FinancialStatements in place and the operating effectiveness of such controls.

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

(d) Conclude on the appropriateness of management's use of the going concern basis ofaccounting and based on the audit evidence obtained whether a material uncertaintyexists related to events or conditions that may cast significant doubt on the Company'sability to continue as a going concern. If we conclude that a material uncertainty existswe are required to draw attention in our auditor's report to the related disclosures inthe Standalone Financial Statements or if such disclosures are inadequate to modify ouropinion. Our conclusions are based on the audit evidence obtained up to the date of ourauditor's report. However future events or conditions may cause the Company to cease tocontinue as a going concern.

(e) Evaluate the overall presentation structure and content of the StandaloneFinancial Statements including the disclosures and whether the Standalone FinancialStatements represent the underlying transactions and events in a manner that achieves fairpresentation.

Materiality is the magnitude of misstatements in the standalone financial statementsthat individually or in aggregate makes it probable that the economic decisions of thereasonably knowledgeable users of the Standalone Financial Statements may be influenced.We consider quantitative materiality and qualitative factors in

(i) planning the scope of our audit work and in evaluating the results of our work; and

(ii) to evaluate the effect of any identified misstatements in the Standalone FinancialStatements.

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

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

From the matters communicated with those charged with governance we determine thosematters that were of most significance in the audit of the Standalone Financial Statementsof the current period and are therefore the key audit matters. We describe these mattersin our auditor's report unless law or regulation precludes public disclosure about thematter or when in extremely rare circumstances we determine that a matter should not becommunicated in our report because the adverse consequences of doing so would reasonablybe expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

As required by the Companies (Auditor's Report) Order 2016 ("the Order")issued by the Central Government of India in terms of sub-section (11) of section 143 ofthe Act we give in the Annexure "A" a statement on the mattersspecified in paragraphs 3 and 4 of the Order to the extent applicable.

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

(a) We have sought and obtained all the information and explanations which to the bestof 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 theCompany so far as it appears from our examination of those books.

(c) The Standalone Balance Sheet the Standalone Statement of Profit and Loss(including Other Comprehensive Income) the Standalone Statement of Changes in Equity andthe Standalone Statement of Cash Flows dealt with by this Report are in agreement with thebooks of account.

(d) In our opinion the aforesaid Standalone Financial Statements comply with theIndian Accounting Standards specified under Section 133 of the Act read with relevantrules issued thereunder.

(e) On the basis of the written representations received from the directors as on March31 2020 taken on record by the Board of Directors none of the directors of the Companyis disqualified as on March 31 2020 from being appointed as a director in terms ofSection 164 (2) of the Act.

(f) With respect to the adequacy of the internal financial controls with reference tofinancial statements of the Company and the operating effectiveness of such controlsrefer to our separate Report in "Annexure B".

(g) According to information and explanation given to us and based on our examinationof the records of the Company the Company has paid/provided managerial remuneration inaccordance with the provisions of Section 197 of the Act.

(h) With respect to the other matters to be included in the Auditor's Report inaccordance with Rule 11 of the Companies (Audit and Auditors) Rules 2014 in our opinionand 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 in its financialposition in its Standalone Financial Statements – Refer Note 45(I) to the StandaloneFinancial Statements;

ii. The Company did not have any long-term contracts including derivative contractsduring the year ended March 31 2020 for which there were any material foreseeablelosses.

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

For KALYANIWALLA & MISTRY LLP

CHARTERED ACCOUNTANTS

Firm Registration Number 104607W/W100166

FARHAD M. BHESANIA

PARTNER

Membership Number 127355

UDIN: 20127355AAAACI8702

Place: Mumbai

Dated: June 19 2020

ANNEXURE A TO THE INDEPENDENT AUDITOR'S REPORT

The Annexure referred to in paragraph 1 ‘Report on Other Legal and RegulatoryRequirements' in our Independent Auditors' Report to the members of the Company on theStandalone Financial Statements for the year ended March 31 2020.

Statement on Matters specified in paragraphs 3 & 4 of the

Companies (Auditor's Report) Order 2016:

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

b) The Company has a regular program of physical verification of its fixed assets bywhich all fixed assets are verified in a phased manner over a period of three years. Inour opinion this periodicity of physical verification is reasonable having regard to thesize of the Company and the nature of its assets. However the management was unable toconduct the planned physical verification of fixed assets during the year as the same wasscheduled during the period of nationwide lockdown declared by the Government of India andit was impracticable to perform the verification procedures on account of closure of allfactories and offces. Hence our comment on the discrepancies if any noticed during thephysical verification of fixed assets and whether the same has been properly dealt with inthe books of account does not arise.

c) According to the information and explanations given to us and on the basis of ourexamination of the records of the Company the title deeds of immovable properties ownedby the Company are held in the name of the Company except as tabulated below:

Particulars Gross Block Net Block Remarks
Freehold land (Rs. in Lakhs) (Rs. in Lakhs) In the erstwhile
at Pali 207.19 207.19 name of Camlin
Fine Chemicals Ltd.

In respect of immovable properties taken on lease the lease agreements are in the nameof the Company.

ii. The inventory has been physically verified by the management during the year. Inour opinion the frequency of such verification is reasonable. The Company has maintainedproper records of inventory. The discrepancies noticed on verification between thephysical stock and the book records were not material.

iii. According to information and explanation given to us the Company has grantedunsecured loans to five companies covered in the register maintained under section 189 ofthe Act. The Company has not granted any loans secured or unsecured to firms or otherparties covered in the register required to be maintained under Section 189 of the Act.

a) According to the information and explanations given to us and based on the auditprocedures conducted by us we are of the opinion that the rate of interest and otherterms and conditions of unsecured loans granted by the Company to companies covered in theregister required to be maintained under Section 189 of the Act are not prima facieprejudicial to the interest of the Company.

b) According to the information and explanations given to us and based on the auditprocedures conducted by us the unsecured loans granted to companies and the interestthereon are repayable on demand except in respect of one unsecured loan wherein theprincipal is repayable after two years and the accrued interest is payable on demand oralongwith repayment of the loan. In respect of unsecured loans which are repayable ondemand the Company did not demand any sums towards principal or interest during the yearand in respect one unsecured loan the stipulated repayment date of the principal did notfall due during the year and the Company has not demanded for the interest payment duringthe year and hence the question of commenting on whether repayment of principal andinterest are regular does not arise.

c) There are no overdue amounts of more than 90 days in respect of the unsecured loansgranted to companies by the Company.

iv. In our opinion and according to the information and explanations given to us andthe records examined by us the Company has complied with the provisions of Section 185and 186 of the Act with respect to the loans given investments made guarantees andsecurities given by the Company.

v. As indicated in Note 27.2 to the Standalone Financial Statements the Company hasin respect of the deposits accepted by it complied with the provisions of section 73 to76 of the Act read with the rules framed there under. According to the information andexplanation given to us the Company has not accepted deposits during the year ended March31 2020 and to the best of our knowledge and belief no order has been passed by theCompany Law board or the Reserve Bank of India or any court or other tribunal which is tobe complied with by the Company.

vi. We have broadly reviewed the books of account maintained by the Company in respectof the products where pursuant to the rules made by the Central

Government of India the maintenance of cost records has been prescribed under Section148 of the Act and are of the opinion that prima facie the prescribed accounts andrecords have been made and maintained.

We have not however made a detailed examination of the records with a view todetermine whether they are accurate or complete.

vii. (a) According to the information and explanations given to us and the recordsexamined by us the Company is generally regular in depositing undisputed statutory duesincluding Provident Fund Employees' State Insurance Income Tax Sales Tax Service TaxDuty of Customs Duty of Excise Value Added Tax Cess and any other statutory dues withthe appropriate authorities wherever applicable and there are no undisputed duesoutstanding as at March 31 2020 for a period of more than six months from the date theybecame payable.

(b) According to the information and explanations given to us there are no dues ofIncome-tax Sales tax Service tax Goods and Services tax duty of Customs duty ofExcise Value added tax which has not been deposited by the Company on account ofdisputes except for the following:

Name of the Statute Nature of Dues Amount (INR in lakhs) Period to which the amount relates Forum
Central Excise Act 1944 and Excise Customs Act 1962. Excise Duty 356.02 2013-2014 Commissioner – Central
Income Tax Act 1961 of Income Tax- (Appeals) Income tax 44.41 2015-2016 Commissioner

viii. According to the information and explanations given to us and based on thedocuments and records produced to us the Company has not defaulted in repayment of loansor borrowings from financial institutions banks or government nor has issued anydebentures. Accordingly paragraph 3 (viii) of the Order is not applicable to the Company.

ix. According to the information and explanations given to us the Company has notraised money through initial public offer or further public offer (including debtinstruments) and term loans accordingly the provisions of paragraph 3(ix) of the Orderare not applicable.

x. During the course of our examination of the books of account and records of theCompany and according to the information and explanation given to us and representationsmade by the management no material fraud by or on the Company has been noticed orreported during the year.

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

xii. In our opinion and according to the information and explanations given to us theCompany is not a Nidhi Company as prescribed under Section 406 of the Act. Accordinglyreporting under (xii) of the Order is not applicable.

xiii. According to the information and explanations given to us and based on ourexamination of the records of the Company transactions with related parties are incompliance with Section 177 and 188 of the Act where applicable and the details havebeen disclosed in the Standalone Financial Statements as required by the applicable IndianAccounting Standards.

xiv. According to the information and explanations given to us and based on ourexamination of the records the Company has not made any preferential allotment or privateplacement of shares or fully or partly convertible debentures during the year.Accordingly paragraph 3 (xiv) of the Order is not applicable to the Company.

xv. According to the information and explanations given to us and based on ourexamination of the records the Company has not entered into non-cash transactions withthe directors or persons connected with them. Hence the provisions of Section 192 of theAct are not applicable.

xvi. According to information and explanations given to us the Company is not requiredto be registered under Section 45-IA of the Reserve Bank of India Act 1934. Accordinglyreporting under (xvi) of the Order is not applicable.

For KALYANIWALLA & MISTRY LLP

CHARTERED ACCOUNTANTS

Firm Registration Number 104607W/W100166

FARHAD M. BHESANIA

PARTNER

Membership Number 127355

UDIN: 20127355AAAACI8702

Place: Mumbai

Dated: June 19 2020

ANNEXURE B TO THE INDEPENDENT AUDITOR'S REPORT

Referred to in Para 2 (f) ‘Report on Other Legal and Regulatory Requirements' inour Independent Auditor's Report to the members of the Company on the Standalone FinancialStatements for the year ended March 31 2020.

Report on the Internal Financial Controls with reference to financial statements underClause (i) of Sub-section 3 of Section 143 of the Companies Act 2013 ("theAct")

We have audited the internal financial controls with reference to financial statementsof CAMLIN FINE SCIENCES LIMITED

("the Company") as of March 31 2020 in conjunction with our audit of theStandalone Financial Statements of the Company for the year ended on that date.

Management's Responsibility for Internal Financial Controls

The Company's management is responsible for establishing and maintaining internalfinancial controls based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the"Guidance Note") issued by the Institute of Chartered Accountants of India(ICAI). These responsibilities include the design implementation and maintenance ofadequate internal financial controls that were operating effectively for ensuring theorderly and effcient conduct of its business including adherence to the company'spolicies the safeguarding of its assets the prevention and detection of frauds anderrors the accuracy and completeness of the accounting records and the timelypreparation of reliable financial information as required under the Act.

Auditors' Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols with reference to financial statements based on our audit. We conducted our auditin accordance with the Guidance Note and the Standards on Auditing issued by ICAI anddeemed to be prescribed under Section 143(10) of the Act to the extent applicable to anaudit of internal financial controls both applicable to an audit of internal FinancialControls and both issued by the ICAI. Those Standards and the Guidance Note require thatwe comply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether adequate internal financial controls with reference to financialstatements was established and maintained and if such controls operated effectively in allmaterial respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls system with reference to financial statements and theiroperating effectiveness. Our audit of internal financial controls with reference tofinancial statements included obtaining an understanding of internal financial controlswith reference to financial statements assessing the risk that a material weaknessexists and testing and evaluating the design and operating effectiveness of internalcontrol based on the assessed risk. The procedures selected depend on the auditor'sjudgment including the assessment of the risks of material misstatement of the StandaloneFinancial Statements whether due to fraud or error.

We believe that the audit evidence we have obtained is suffcient and appropriate toprovide a basis for our audit opinion on the Company's internal financial controls systemwith reference to financial statements.

Meaning of Internal Financial Controls with reference to Financial Statements

A Company's internal financial controls with reference to financial statements is aprocess designed to provide reasonable assurance regarding the reliability of financialreporting and the preparation of Standalone Financial Statements for external purposes inaccordance with generally accepted accounting principles. A company's internal financialcontrol with reference to financial statements includes those policies and procedures that

(1) pertain to the maintenance of records that in reasonable detail accurately andfairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permitpreparation of the Standalone Financial Statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the company are being madeonly in accordance with authorizations of management and directors of the company; and

(3) provide reasonable assurance regarding prevention or timely detection ofunauthorized acquisition use or disposition of the company's assets that could have amaterial effect on the Standalone Financial Statements.

Inherent Limitations of Internal Financial Controls with reference to FinancialStatements

Because of the inherent limitations of internal financial controls with reference tofinancial statements including the possibility of collusion or improper managementoverride of controls material misstatements due to error or fraud may occur and not bedetected. Also projections of any evaluation of the internal financial controls withreference to financial statements to future periods are subject to the risk that theinternal financial control with reference to financial statements may become inadequatebecause of changes in conditions or that the degree of compliance with the policies orprocedures may deteriorate.

Opinion

In our opinion the Company has in all material respects an adequate internalfinancial controls system with reference to financial statements and such internalfinancial controls with reference to financial statements were operating effectively as atMarch 31 2020 based on the internal control over financial reporting criteriaestablished by the Company considering the essential components of internal control statedin the "Guidance Note on Audit of Internal Financial Controls Over FinancialReporting" issued by the Institute of Chartered Accountants of India.

For KALYANIWALLA & MISTRY LLP

CHARTERED ACCOUNTANTS

Firm Registration Number 104607W/W100166

FARHAD M. BHESANIA

PARTNER

Membership Number 127355

UDIN: 20127355AAAACI8702

Place: Mumbai

Dated: June 19 2020

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