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Gujarat Narmada Valley Fertilizers & Chemicals Ltd.

BSE: 500670 Sector: Agri and agri inputs
NSE: GNFC ISIN Code: INE113A01013
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VOLUME 426022
52-Week high 425.00
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P/E 6.50
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OPEN 386.00
CLOSE 383.05
VOLUME 426022
52-Week high 425.00
52-Week low 183.25
P/E 6.50
Mkt Cap.(Rs cr) 6,026
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Gujarat Narmada Valley Fertilizers & Chemicals Ltd. (GNFC) - Auditors Report

Company auditors report

TO THE MEMBERS OF GUJARAT NARMADA VALLEY FERTILIZERS & CHEMICALS LIMITED

Report on the Audit of the Standalone Ind AS Financial Statements

Opinion

We have audited the accompanying standalone Ind AS financial statements of GujaratNarmada Valley Fertilizers & Chemicals Limited (the “Company”) whichcomprise the Balance sheet as at March 31 2020 the Statement of Profit and Lossincluding Other Comprehensive Income the Cash Flow Statement and the Statement of Changesin Equity for the year then ended and notes to the financial statements including asummary of significant accounting policies and other explanatory information. In ouropinion and to the best of our information and according to the explanations given to usthe aforesaid standalone Ind AS financial statements give the information required by theCompanies Act 2013 as amended (the “Act”) in the manner so required and give atrue and fair view in conformity with the accounting principles generally accepted inIndia of the state of affairs of the Company as at March 31 2020 its profit includingother comprehensive income its cash flows and the changes in equity for the year ended onthat date.

Basis for Opinion

We conducted our audit of the standalone Ind AS financial statements in accordance withthe Standards on Auditing (SAs) as specified under section 143(10) of the Act. Ourresponsibilities under those Standards are further described in the ‘Auditor'sResponsibilities for the Audit of the Standalone Ind AS Financial Statements' section ofour 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 ethicalrequirements 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 Ind AS financial statements.

Emphasis of Matter – DOT Demand Notice

We draw attention to Note 43 to the standalone Ind AS financial statements regarding amatter relating to demand of Rs. 16359.21 Crores on the Company by Department ofTelecommunications (DoT) towards Very Small Aperture Terminal (‘VSAT') and InternetService Provider (‘ISP') Licenses fee as explained in detail in the said Note. Basedon the legal opinion taken by the Company in the matter and pending outcome of theCompany's representation to DOT and based on the Company's assessment of this demand theCompany is of the view that no provision is necessary in respect of this matter. Ouropinion is not modified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that in our professional judgment were of mostsignificance in our audit of the standalone Ind AS financial statements for the financialyear ended March 31 2020. These matters were addressed in the context of our audit of thestandalone Ind AS financial statements as a whole and in forming our opinion thereon andwe do not provide a separate opinion on these matters. For each matter below ourdescription of how our audit addressed the matter is provided in that context. We havedetermined the matters described below to be the key audit matters to be communicated inour report.

We have fulfilled the responsibilities described in the Auditor's responsibilities forthe audit of the standalone Ind AS financial statements section of our report includingin relation to these matters. Accordingly our audit included the performance ofprocedures designed to respond to our assessment of the risks of material misstatement ofthe standalone Ind AS financial statements. The results of our audit procedures includingthe procedures performed to address the matters below provide the basis for our auditopinion on the accompanying standalone Ind AS financial statements.

KEY AUDIT MATTERS HOW OUR AUDIT ADDRESSED THE KEY AUDIT MATTER
Recognition/de-recognition and measurement of Urea Subsidy Income
The Urea Subsidy Income is recognized and measured in accordance with notification/ circular/ policies issued by the Department of Fertilizers Government of India. Our audit procedures included the following:
• We assessed the Company's revenue recognition policy for Urea Subsidy Income.
During the year ended March 31 2020 the Company has recognized Urea Subsidy Income of Rs 1362.58 Crores (including Rs. 159.23 Crores pertaining to earlier years towards fixed cost subsidy as disclosed in notes to financial statements) and has outstanding Urea subsidy receivables of Rs 1093.86 Crores (including Rs 77.69 Crores outstanding for more than one year as at March 31 2020. • We understood evaluated and tested on a sample basis the design and operating effectiveness of key internal controls over recognition and measurement of Urea Subsidy Income.
• We reviewed the relevant regulatory pronouncement in respect of Urea subsidy income and verified on a sample basis the claims filed by the Company along-with underlying accounting evidences in respect of such income.
The measurement of Urea subsidy Income involves application of relevant regulatory pronouncements and notifications understanding of applicable energy norms and estimation / judgement including adjustment at each reporting date in respect of escalation / de-escalation in the prices of inputs etc. The recognised subsidy income may deviate on account of revision / changes in such interpretation estimates and judgements. • We tested calculations for Urea Subsidy Income and reviewed estimates for escalation / de-escalation by comparing with actual production cost relevant for measurement of subsidy amount.
Accordingly recognition and measurement of subsidy income is determined to be a key audit matter for our audit of Standalone Ind AS financial statements. • We reviewed follow-ups made by the Company with the Department of Fertilizers Government of India and management assessment of recoverability of aged balances.
• We tested the collections made during the year as well as subsequent period against such subsidy income recognized by the Company.
• We assessed the appropriateness of disclosures in the Standalone Ind AS financial statements in respect of Urea Subsidy Income.
Impairment assessment of Property plant and equipment used for production of Toluene di-isocyanate (TDI) (as described in Note 49 of the Standalone Ind AS financial statements)
During the year ended March 31 2020 the Company has witnessed significant decline in the operating profit margins of Toluene di- isocyanate (TDI) which has affected the financial performance of the Company's chemical segment. These are considered as indicators for impairment by the management for TDI II Dahej Plant which is determined to a separate cash generating unit (CGU) for impairment assessment. Our audit procedures included the following:
• We assessed the assumptions made by the management with regard to identification of the Property plant and equipment used in production of TDI as a separate cash generated unit (identified CGU).
As at March 31 2020 the gross and the net carrying values of the property plant and equipment at TDI II Dahej Plant is Rs 2265 Crores and Rs 1587 Crores respectively. • We involved our valuation specialists and evaluated the management's assumptions and estimates used for determining the recoverable amount of the identified CGU including those relating to long-term growth rates margins and discount rates.
Management has calculated the recoverable amount for the aforesaid CGU by determining its value in use from the future free cash flows prepared by the management. • We reviewed the calculations for the cash flows and agreed relevant data to the budgets and latest forecast provided by the management.
KEY AUDIT MATTERS HOW OUR AUDIT ADDRESSED THE KEY AUDIT MATTER
Significant management estimates and judgements are involved in determining value in use including key assumptions such as discount rate product price realisation over a foreseeable future demand of product and other cost factors. We reviewed the sensitivity analysis for key assumptions with focus on the growth rate margins and discount rate used in the impairment calculations.
Accordingly this is determined to be a key audit matter for our audit of Standalone Ind AS financial statements. We assessed the appropriateness of the disclosure included in Note 49 of the Standalone Ind AS financial statements.
Valuation of Inventories including Stores & Spares
The Company has total inventory of Rs 932.35 Crores which comprises of raw material inventory Rs 191.99 Crores WIP inventory Rs 84.90 Crores finished goods inventory Rs 133.62 crores trading inventory Rs 2.28 crores and stores and spares inventory (including coal) Rs 519.56 crores (net of provision for inventory obsolescence as at March 31 2020. Our audit procedures included the following:
• We reviewed the management policy for physical verification and the documents related to management's and independent consultant's physical count procedure actually followed during the year.
The Company has stores and spares inventory of Rs 399.85 Crores (excluding coal inventory of Rs 122.20 Crores) as at March 31 2020. The Company has created a provision of Rs 2.50 Crores against inventory of stores and spares based on evaluation of its usability. The stores and spares inventory have many aged items as well however the management's internal assessment represents the usability of these items in future years and that the value of such items does not require any further impairment / provision to be made as at March 31 2020. • We understood the management process for assessment of value in use/ net realisable value of inventory and making provision for obsolete inventory including performing process through third party involvement for the effectiveness of the same.
• We reviewed the management's judgement applied in estimating the value of inventory obsolescence for stores & spares taking into consideration management assessment of the present and future condition of the inventory.
Accordingly appropriateness of the estimates used to identify the valuation of inventories including stores and spares is determined to be a key audit matter for our audit of Standalone Ind AS financial statements. • We performed substantive audit procedures that included review of working prepared by the management for valuation of inventories and observed that appropriate allocation of fixed cost and variable cost is done in respect of Finished Goods and Work in Progress which is in lines with prevailing accounting standards.
• We have performed Physical verification of inventories as at subsequent date on account of Covid -19 lockdown restrictions during year end and have reviewed necessary roll back procedures. Our procedures did not identify any material exceptions.

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

The Company's Board of Directors is responsible for the other information. The otherinformation comprises the information included in the Annual report but does not includethe standalone Ind AS financial statements and our auditor's report thereon. Our opinionon the standalone Ind AS financial statements does not cover the other information and wedo not express any form of assurance conclusion thereon. In connection with our audit ofthe standalone Ind AS financial statements our responsibility is to read the otherinformation and in doing so consider whether such other information is materiallyinconsistent with the financial statements or our knowledge obtained in the audit orotherwise appears to be materially misstated. If based on the work we have performed weconclude that there is a material misstatement of this other information we are requiredto report that fact. We have nothing to report in this regard.

Responsibilities of Management for the Standalone Ind AS Financial 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 Ind AS 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 including the Companies(Indian Accounting Standards) Amendment Rules 2019. This responsibility also includesmaintenance of adequate accounting records in accordance with the provisions of the Actfor safeguarding of the assets of the Company and for preventing and detecting frauds andother irregularities; selection and application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent; and the design implementationand maintenance of adequate internal financial controls that were operating effectivelyfor ensuring the accuracy and completeness of the accounting records relevant to thepreparation and presentation of the standalone Ind AS financial statements that give atrue and fair view and are free from material misstatement whether due to fraud or error.

In preparing the standalone Ind AS 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.

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

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

Our objectives are to obtain reasonable assurance about whether the standalone Ind ASfinancial 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 Ind AS financial statements.

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

• Identify and assess the risks of material misstatement of the standalone Ind ASfinancial statements whether due to fraud or error design and perform audit proceduresresponsive to those risks and obtain audit evidence that is sufficient and appropriate toprovide a basis for our opinion. The risk of not detecting a material misstatementresulting from fraud is higher than for one resulting from error as fraud may involvecollusion forgery intentional omissions misrepresentations or the override of internalcontrol.

• 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 Company hasadequate internal financial controls system in place and the operating effectiveness ofsuch controls.

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

• Conclude on the appropriateness of management's use of the going concern basisof accounting 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 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'sreport. However future events or conditions may cause the Company to cease to continue asa going concern.

• Evaluate the overall presentation structure and content of the standalone IndAS financial statements including the disclosures and whether the standalone Ind ASfinancial statements represent the underlying transactions and events in a manner thatachieves fair presentation. We communicate with those charged with governance regardingamong other matters the planned scope and timing of the audit and significant auditfindings including any significant deficiencies in internal control that we identifyduring 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 Ind AS financialstatements for the financial year ended March 31 2020 and are therefore the key auditmatters. 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 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 1” a statement on the matters specified inparagraphs 3 and 4 of the Order.

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

(a) We have sought and obtained all the information and explanations which to the 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 Balance Sheet the Statement of Profit and Loss including the Statement ofOther Comprehensive Income the Cash Flow Statement and Statement of Changes in Equitydealt with by this Report are in agreement with the books of account;

(d) In our opinion the aforesaid standalone Ind AS financial statements comply withthe Accounting Standards specified under Section 133 of the Act read with the Companies(Indian Accounting Standards) Rules 2015 as amended including the Companies (IndianAccounting Standards) Amendment Rules 2019;

(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 is disqualifiedas on March 31 2020 from being appointed as a director in terms of Section 164 (2) of theAct;

(f) With respect to the adequacy of the internal financial controls over financialreporting of the Company with reference to these standalone Ind AS financial statementsand the operating effectiveness of such controls refer to our separate Report in“Annexure 2” to this report;

(g) In our opinion the managerial remuneration for the year ended March 31 2020 hasbeen paid / provided by the Company to its directors in accordance with the provisions ofsection 197 read with Schedule V to 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 as amended inour opinion and to the best of our information and according to the explanations given tous:

i. The Company has disclosed the impact of pending litigations on its financialposition in its standalone Ind AS financial statements – Refer Note 36 to thestandalone Ind AS financial statements;

ii. The Company did not have any long-term contracts including derivative contracts forwhich there were any material foreseeable losses;

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

For S R B C & CO LLP
Chartered Accountants
ICAI Firm Registration Number: 324982E/E300003
per Ravi Bansal
Partner
Place of Signature: Mumbai Membership Number: 049365
Date: July 10 2020 UDIN: 20049365AAAABU9663

ANNEXURE 1 REFERRED TO IN PARAGRAPH ON REPORT ON OTHER LEGAL AND REGULATORYREQUIREMENTS OF OUR REPORT OF EVEN DATE OF GUJARAT NARMADA VALLEY FERTILIZERS &CHEMICALS LIMITED FOR THE YEAR ENDED MARCH 31 2020

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

(b) The fixed assets of the company were physically verified by the management pursuantto the program of verifying them once in three years which in our opinion is reasonablehaving regard to the size of the Company and the nature of its assets.

(c) According to the information and explanations given by the management the titledeeds of immovable properties included in property plant and equipment are held in thename of the Company. In respect of immovable properties of land that have been taken onlease and disclosed as property plant and equipment (note 4) in the financial statementsthe lease agreement for two parcels of the leasehold land with an aggregate carrying valueof Rs 41.06 crores (Aggregate Gross block of Rs. 43.05 crores) as at March 31 2020 areyet to be entered in the name of the Company although the Company is the lessee as perthe arrangement.

(ii) The management has conducted physical verification of inventory at reasonableintervals during the year and no material discrepancies were noticed on such physicalverification. There was no inventory lying with third parties.

(iii) According to the information and explanations given to us the Company has notgranted any loans secured or unsecured to companies firms Limited LiabilityPartnerships or other parties covered in the register maintained under section 189 of theCompanies Act 2013. Accordingly the provisions of clause 3(iii)(a) (b) and (c) of theOrder are not applicable to the Company and hence not commented upon.

(iv) In our opinion and according to the information and explanations given to us theCompany has not advanced any loans to directors / to a Company in which the director isinterest to which provisions of Section 185 of the Companies Act 2013 apply and hence notcommented upon. In our opinion and according to the information and explanations given tous provisions of section 186 of the Companies Act 2013 in respect of loans and advancesgiven investment made and guarantees and securities given have been complied with by theCompany.

(v) In our opinion and according to the information and explanations given to us theCompany has not accepted any deposits from the public during the year. However in regardto the unclaimed deposits the Company has complied with the provisions of Section 73 to 76of the Act and the Companies (Acceptance of Deposits) Rules 2014 (as amended).

(vi) We have broadly reviewed the books of account maintained by the Company pursuantto the rules made by the Central Government for the maintenance of cost records undersection 148(1) of the Companies Act 2013 related to the manufacture of fertilizer andindustrial products and for the services provided by the Company. In our opinion primafacie the specified accounts and records have been made and maintained. We have nothowever made a detailed examination of the same.

(vii) (a) Undisputed statutory dues including provident fund income-tax goods andservice tax cess and other statutory dues have generally been regularly deposited withthe appropriate authorities though there has been a slight delay in a few cases.

(b) According to the information and explanations given to us no undisputed amountspayable in respect of provident fund income-tax sales-tax service tax duty of customduty of excise value added tax goods and service tax cess and other statutory dues wereoutstanding at the year end for a period of more than six months from the date theybecame payable.

(c) According to the records of the Company the dues of income-tax sales-tax servicetax duty of excise value added tax and cess on account of any dispute are as follows:

Name of Statute Nature of dues Forum where dispute is pending Period to which the amount related Amount involved Amount Unpaid*
(Rs. in Crores) (Rs. in Crores)
Assistant/ deputy Commissioner 1997-2002 1.93 1.19
Central Excise Act 1944 Excise Duty CESTAT Ahmedabad 2015-2016 0.05 0.05
Commissioner Appeals Baroda 2009-2013 119.35 119.35
Central Sales Tax Act 1994/Gujarat Value Added Tax Act 2004 Gujarat Value added Tax tribunal 2006-2007 13.95 13.45
2007-08 19.06 18.56
Joint Commissioner Baroda 2012-13 13.11 6.23
2014-15 15.62 15.52
Madhya Pradesh VAT Act 2002 Value Added Tax/Central Sales tax VAT Appellate Authority Bhopal 2015-16 0.11 0.09
Central Sales Tax Act 1994/Gujarat Value Added Tax Act 2004 Deputy Commissioner Bharuch 2015-16 0.31 0.31
Central Sales Tax Act 1994 Deputy Commissioner –Lucknow 2016-17 3.30 3.30
The Income Tax Act 1961 Assessing Officer AY 2018-19 3.00 3.00

* Net of Amount paid under protest

(viii) In our opinion and according to the information and explanations given by themanagement the Company has not defaulted in repayment of loans or borrowing to banks. TheCompany did not have any outstanding loans or borrowings dues in respect of financialinstitutions government or dues to debenture holders during the year.

(ix) According to the information and explanations given by the management the Companyhas not raised any money way of initial public offer / further public offer / debtinstruments and term loans hence reporting under clause (ix) is not applicable to theCompany and hence not commented upon.

(x) Based upon the audit procedures performed for the purpose of reporting the true andfair view of the financial statements and according to the information and explanationsgiven by the management we report that no fraud by the company or no fraud / materialfraud on the Company by the officers and employees of the Company has been noticed orreported during the year.

(xi) According to the information and explanations given by the management themanagerial remuneration has been paid / provided in accordance with the requisiteapprovals mandated by the provisions of section 197 read with Schedule V to the CompaniesAct 2013.

(xii) In our opinion the Company is not a nidhi company. Therefore the provisions ofclause 3(xii) of the order are not applicable to the Company and hence not commented upon.

(xiii) According to the information and explanations given by the managementtransactions with the related parties are in compliance with section 177 and 188 ofCompanies Act 2013 where applicable and the details have been disclosed in the notes tothe financial statements as required by the applicable accounting standards.

(xiv) According to the information and explanations given to us and on an overallexamination of the balance sheet the Company has not made any preferential allotment orprivate placement of shares or fully or partly convertible debentures during the yearunder review and hence reporting requirements under clause 3(xiv) are not applicable tothe company and not commented upon.

(xv) According to the information and explanations given by the management the Companyhas not entered into any non-cash transactions with directors or persons connected withhim as referred to in section 192 of Companies Act 2013.

(xvi) According to the information and explanations given to us the provisions ofSection 45-IA of the Reserve Bank of India Act 1934 are not applicable to the Company.

For S R B C & CO LLP
Chartered Accountants
ICAI Firm Registration Number: 324982E/E300003
per Ravi Bansal
Partner
Place of Signature: Mumbai Membership Number: 049365
Date: July 10 2020 UDIN: 20049365AAAABU9663

ANNEXURE 2 TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE STANDALONE IND ASFINANCIAL STATEMENTS OF GUJARAT NARMADA VALLEY FERTILIZERS & CHEMICALS LIMITED

We have audited the internal financial controls over financial reporting of GujaratNarmada Valley Fertilizers & Chemicals Limited (the “Company”) as of March31 2020 in conjunction with our audit of the standalone Ind AS financial statements ofthe 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 Reportingissued by the Institute of Chartered Accountants of India. These responsibilities includethe design implementation and maintenance of adequate internal financial controls thatwere operating effectively for ensuring the orderly and efficient conduct of its businessincluding adherence to the Company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information asrequired under the Companies Act 2013.

Auditor's Responsibility

Our responsibility is to express an opinion on the Company's internal financialcontrols over financial reporting with reference to these standalone Ind AS financialstatements based on our audit. We conducted our audit in accordance with the Guidance Noteon Audit of Internal Financial Controls Over Financial Reporting (the “GuidanceNote”) and the Standards on Auditing as specified under section 143(10) of theCompanies Act 2013 as amended to the extent applicable to an audit of internal financialcontrols and both issued by the Institute of Chartered Accountants of India. 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 over financial reporting with reference to these standalone Ind ASfinancial statements was established and maintained and if such controls operatedeffectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy ofthe internal financial controls over financial reporting with reference to thesestandalone Ind AS financial statements and their operating effectiveness. Our audit ofinternal financial controls over financial reporting included obtaining an understandingof internal financial controls over financial reporting with reference to these standaloneInd AS financial statements assessing the risk that a material weakness exists andtesting and evaluating the design and operating effectiveness of internal control based onthe assessed risk. The procedures selected depend on the auditor's judgement includingthe assessment of the risks of material misstatement of the financial statements whetherdue to fraud or error. We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our audit opinion on the internal financialcontrols over financial reporting with reference to these standalone Ind AS financialstatements.

Meaning of Internal Financial Controls Over Financial Reporting With Reference to theseStandalone Ind AS Financial Statements

A company's internal financial control over financial reporting with reference to thesestandalone Ind AS financial statements is a process designed to provide reasonableassurance regarding the reliability of financial reporting and the preparation offinancial statements for external purposes in accordance with generally acceptedaccounting principles. A company's internal financial control over financial reportingwith reference to these standalone Ind AS financial statements includes those policies andprocedures that (1) pertain to the maintenance of records that in reasonable detailaccurately and fairly reflect the transactions and dispositions of the assets of thecompany; (2) provide reasonable assurance that transactions are recorded as necessary topermit preparation of financial statements in accordance with generally acceptedaccounting principles and that receipts and expenditures of the company are being madeonly in accordance with authorisations of management and directors of the company; and (3)provide reasonable assurance regarding prevention or timely detection of unauthorisedacquisition use or disposition of the company's assets that could have a material effecton the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting WithReference to these Standalone Ind AS Financial Statements

Because of the inherent limitations of internal financial controls over financialreporting with reference to these standalone Ind AS financial statements including thepossibility of collusion or improper management override of controls materialmisstatements due to error or fraud may occur and not be detected. Also projections ofany evaluation of the internal financial controls over financial reporting with referenceto these standalone Ind AS financial statements to future periods are subject to the riskthat the internal financial control over financial reporting with reference to thesestandalone Ind AS financial statements may become inadequate because of changes inconditions or that the degree of compliance with the policies or procedures maydeteriorate.

Opinion

In our opinion the Company has in all material respects adequate internal financialcontrols over financial reporting with reference to these standalone Ind AS financialstatements and such internal financial controls over financial reporting with reference tothese standalone Ind AS financial statements were operating effectively as at March 312020 based on the internal control over financial reporting criteria established by theCompany considering the essential components of internal control stated in the GuidanceNote on Audit of Internal Financial Controls Over Financial Reporting issued by theInstitute of Chartered Accountants of India.

For S R B C & CO LLP
Chartered Accountants
ICAI Firm Registration Number: 324982E/E300003
per Ravi Bansal
Partner
Place of Signature: Mumbai Membership Number: 049365
Date: July 10 2020 UDIN: 20049365AAAABU9663

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