Auditor Report of Gayatri Projects Ltd.

Mar 31, 2025

We have audited the Standalone Financial Statements
of Gayatri Projects Limited ("the Company"), which
comprise the Balance Sheet as at 31^st March, 2025,
and the Statement of Profit and Loss (including Other
Comprehensive Income), the Statement of Changes
in Equity and the Statement of Cash Flows for the year
then ended, and notes to the Standalone Financial
Statements, including a summary of significant
accounting policies and other explanatory information
(hereinafter referred to as "the Standalone Financial
Statements").

In our opinion and to the best of our information and
according to the explanations given to us, the aforesaid
Standalone Financial Statements give the information
required by the Companies Act, 2013 ("the Act") in
the manner so required and give a true and fair view
in conformity with the Indian Accounting Standards
prescribed under section 133 of the Act read with the
Companies (Indian Accounting Standards) Rules, 2015,
as amended, ("Ind AS") and other accounting principles
generally accepted in India, of the state of affairs of the
Company as at 31^st March, 2025, and the Loss and other
comprehensive loss, changes in equity and its cash
flows for the year ended on that date.

Basis for Opinion

We conducted our audit of the Standalone Financial
Statements in accordance with the Standards on
Auditing (SAs), as specified under Section 143(10) of
the Companies Act, 2013. Our responsibilities under
those standards are further described in the Auditor''s
Responsibilities for the Audit of the Standalone Financial
Statements section of our report.

We are independent of the Company in accordance
with the ''Code of Ethics'' issued by the Institute of
Chartered Accountants of India together with the
ethical requirements that are relevant to our audit
of the standalone financial statements under the
provisions of the Companies Act, 2013 and the Rules
made thereunder, and we have fulfilled our other
ethical responsibilities in accordance with these
requirements and the Code of Ethics. We believe that

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

Material Uncertainty Related to Going Concern

We draw attention to Note No. 34.28 of the audited
standalone financial statements which states that during
the year the company has incurred a loss of C 6,879.61
Lakhs and as at 31^st march, 2025, the accumulated losses
at C 2,00,993.96 Lakhs and there is complete erosion in
the net worth of the company as at 31^st March, 2025,
default in repayment of loans and other financial and
other credit facilities extended to the company by
lenders, issue of various notices by lenders for recovery
of their dues etc., and the initiation of Corporate
Insolvency Resolution Process ("CIRP") proceedings
against the company vide order dated 15^th November,
2022 of Hon''ble National Company Law Tribunal
("NCLT"), Hyderabad bench and Interim Resolution
Professional has been appointed and subsequently
confirmed as Resolution Professional. The aforesaid
factors indicate the existence of uncertainty that may
cast doubt about the company''s ability to continue
as a going concern as at 31^st March, 2025. However,
the audited standalone financial statements for the
Financial Year 2024-25 have been prepared on a going
concern basis as the Hon''ble NCLT had stated that the
operations of the company to be continued as a going
concern and subsequently, as stated in Note No.1 of the
audited standalone financial statements, the promoters
of the company have submitted a One Time Full & Final
Debt Settlement ("OTS") proposal with the lenders of
the company u/s 12A of Insolvency and Bankruptcy
Code, 2016, and the same was accepted by 97.20 % of
COC members (Lenders) and subsequently the Hon''ble
NCLT vide its order dated 10^th September, 2025 has
allowed for withdrawal of CIRP proceedings against the
company and Resolution Professional was discharged.
As stated in Note No. 34.28 of the audited standalone
financial statements, the company has paid the entire
fund-based amounts to the lenders as specified in the
OTS proposal u/s 12A of IBC 2016.

Our Opinion is not modified in respect of the above
matter.

Emphasis of Matters

We draw attention to the following

i) As stated in Note No. 34.17 to the audited
standalone financial statements, the Investee
Company in which the Company has invested
by way of Compulsorily Convertible Cumulative
Preference Shares ("CCCPS"), has incurred
considerable losses and there is complete erosion
of Net worth as on 31^st March, 2025. However, no
provision for diminution / impairment for carrying
value of the investment is provided for the year
ended 31^st March, 2025 for the reasons stated in
the said note.

ii) As stated in Note No. 34.18 to the audited
standalone financial statements, provision has
been made during financial year 2022-23 in
respect of the subordinate debt given to the
associate company. However, no provision has
been made in respect of the NCPS and unsecured
loan receivable from the said associate company
for the detailed reasons / explanations stated in
the said note.

iii) As stated in Note No. 34.19 to the audited
standalone financial statements, the Inter
Corporate Loan grouped under ''Non-current
Loans'' and accumulated interest thereon is long
pending for recovery for which no provision has
been made for the detailed reasons stated in the
said note. Further during the financial year the
company has not accounted any interest income
on the inter corporate loan for reasons stated in
the said note.

iv) As stated in Note No. 34.20 to the audited
standalone financial statements, during the
current financial year the company has written off
the EPC trade receivables from subsidiary of an
associate company for the detailed reasons stated
in the said note.

v) As stated in Note No. 34.1 to the audited
standalone financial statements, regarding
the claims filed by lenders against Corporate
Guarantees held by them, performance and
contractual commitments given by the company
for various projects of the company which have
been recognized as contingent liabilities for
reasons stated in the said note.

vi) As stated in Note No. 34.21 to the audited
standalone financial statements, during the
course of the CIRP of the company, the resolution
professional on behalf of the company has entered
into a settlement agreement with NHAI, GHL and
the erstwhile associate company in respect of the

EPC receivables of the company from its erstwhile
associate company. Pursuant to such agreement
the management of the company has written off
the balance EPC receivable and the impact of the
same is recognized as an exceptional item during
the year ended 31^st March, 2025.

vii) As stated in Note No. 34.22 to the audited
standalone financial statements, the work
advances in respect of certain contract works
given to a sub-contractor grouped under ''Other
Current Assets'' which are long pending for
recovery.

viii) As stated in the Note No. 34.23 to the audited
standalone financial statements, the company
has not made any provision for impairment on
its equity investment in wholly owned subsidiary
company and on unsecured loan given to the said
subsidiary company for the reasons stated in the
said note.

ix) As stated in the Note No. 34.24 to the audited
standalone financial statements, the recovery
of work & other advances and receivables got
delayed from one sub-contractor for the reasons
stated in the said note.

x) As stated in the Note No. 34.25 to the audited
standalone financial statements, wherein it is
explained about the COVID - 19 Pandemic effects
and its impact on the business operations and
cash flows of the company which have caused
the company to default in its loan repayment
obligations to the lenders and various actions
taken by the lenders against the company. It is
further explained about the initiation of Corporate
Insolvency Resolution Process ("CIRP") against the
company as per the order of the Hon''ble National
Company Law Tribunal (NCLT), Hyderabad
bench vide its order dated 15^th November, 2022
and the appointment of the Interim Resolution
Professional, later who has been confirmed as
the Resolution Professional of the company.
Subsequently, the promoters of the company have
submitted a One Time Full & Final Debt Settlement
("OTS") proposal with the lenders of the company
u/s 12A of Insolvency and Bankruptcy Code, 2016,
and the same was accepted by 97.20 % of COC
members (Lenders) and subsequently the Hon''ble
NCLT vide its order dated 10th September, 2025
has allowed for withdrawal of CIRP proceedings
against the company and Resolution Professional
was discharged. As stated in the said Note of the

audited standalone financial statements, the company has paid the entire fund-based amounts as per the
approved OTS proposal u/s 12A of IBC 2016.

Our Opinion is not modified in respect of these matters.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the
Standalone Financial Statements for the year ended 31^st March, 2025. These matters were addressed in the context
of our audit of the Standalone Financial Statements as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters. We have determined the matters described below to be key audit
matters to be communicated in our report.

S.no.	Key Audit Matter	Audit Process
1	Revenue recognition and measurement of contract assets in respect of unbilled amounts The management of the company has applied significant judgement in determining the revenue to be recognised in case of performance obligation satisfied over a period of time; revenue recognition is done by measuring the progress towards complete satisfaction of performance obligation. Revenue is recognized on fixed price construction contracts in accordance with the percentage of completion basis, which necessarily involve technical estimates of the percentage of completion, and costs to completion, of each contract / activity, on the basis of which profits and losses are accounted. When the outcome of the contract is ascertained reliably, contract revenue is recognized at cost of work performed on the contract plus proportionate margin, using the percentage of completion method. Percentage of completion is the proportion of cost of work performed up to the date, to the total estimated contract costs. The stage of completion of contracts is measured by reference to the proportion that contract costs incurred for work performed up to the reporting date bear to the estimated total contract costs for each contract. Further at the reporting date, revenue is accrued for costs incurred against work performed and which are not billed and further measurement of work completed/cost incurred during the period for recognition of unbilled revenue.	We have obtained the procedure and process involved in estimating the percentage of completion of the projects. We have also obtained and verified the costs incurred on the project/works up to the reporting date for the revenues accounted in respect of works on sampling basis. We have also obtained the certified copies (i.e. percentage of completed work approved by the relevant authorities) of works executed till the reporting date in respect of revenues accounted on sampling basis. We have also performed analytical procedures for reasonableness of revenues recognised. We have also verified the reasonableness of the estimation of remaining costs to be incurred to complete the project/work in profit / loss estimated in the project/work. Reviewed the delivery and collection history of customers against whose contracts un-billed revenue is recognised. Tested relevant contracts for measurement of work completed during the period for unbilled revenue.

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

The Company''s Board of Directors is responsible for the preparation of the other information. The other information
comprises the information included in the Management Discussion and analysis, Boards Report including annexures
to Board''s Report, Business Responsibility Report, Corporate Governance and Shareholder''s Information, but does
not include the Standalone Financial Statements and our auditor''s report thereon.

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

In connection with our audit of the Standalone Financial Statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the Standalone

Financial Statements or our knowledge obtained in the
audit or otherwise appears to be materially misstated.

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

Responsibilities of Management and those Charged
with Governance for the Standalone Financial
Statements

The Company''s Board of Directors is responsible for
the matters stated in Section 134(5) of the Companies
Act, 2013 ("the Act") with respect to the preparation
of these Standalone Financial Statements that give a
true and fair view of the financial position, financial
performance, total comprehensive loss, changes in
equity and cash flows of the Company in accordance
with the accounting principles generally accepted in
India, including the Indian Accounting Standards (Ind
AS) specified under section 133 of the Act read with the
Companies (Indian Accounting Standards) Rules, 2015, as
amended.This responsibility also includes maintenance
of adequate accounting records in accordance with the
provisions of the Act for safeguarding of the assets of
the Company and for preventing and detecting frauds
and other irregularities; selection and application of
appropriate accounting policies; makingjudgments and
estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal
financial controls, that were operating effectively
for ensuring the accuracy and completeness of the
accounting records, relevant to the preparation and
presentation of the Standalone Financial Statements
that give a true and fair view and are free from material
misstatement, whether due to fraud or error.

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

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

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

Our objectives are to obtain reasonable assurance
about whether the Standalone Financial Statements as

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

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

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

• Obtain an understanding of internal control
relevant to the audit in order to design
audit procedures that are appropriate in the
circumstances. Under section 143(3)(i) of the
Companies Act, 2013, we are also responsible for
expressing our opinion on whether the company
has adequate internal financial controls system
in place and the operating effectiveness of such
controls.

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

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

to modify our opinion. Our conclusions are based
on the audit evidence obtained up to the date of
our auditor''s report. However, future events or
conditions may cause the Company to cease to
continue as a going concern.

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

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

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

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

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

Report on Other Legal and Regulatory Requirements

1) As required by the Companies (Auditor''s Report)
Order, 2020 ("the Order"), issued by the Central

Government of India in terms of sub-section (11)
of section 143 of the Companies Act, 2013, we give
in the "Annexure A" a statement on the matters
specified in paragraphs 3 and 4 of the Order, to
the extent applicable.

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

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

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

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

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

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

f) With respect to the adequacy of the
internal financial controls over financial
reporting of the Company and the operating
effectiveness of such controls, refer to our
separate Report in "Annexure B".

g) The Company has not paid/ provided
for managerial remuneration, therefore
provisions of Section 197 read with Schedule
V to the Act are not applicable for the current
year ended.

h) With respect to the other matters to
be included in the Auditor''s Report in
accordance with Rule 11 of the Companies

(Audit and Auditors) Rules, 2014, in our
opinion and to the best of our information
and according to the explanations given to
us:

i. As stated in Note no. 34.1, of the
Standalone Financial Statements, the
Company has disclosed the impact
of pending litigations on its financial
position in its Standalone Financial
Statements.

ii. As per the information and
explanations given by the Company,
the Company did not have any long¬
term contracts including derivative
contracts for which there were any
material foreseeable losses.

iii. There are no amounts which are
required to be transferred to the
Investor Education and Protection
Fund during the year ended 31^st March,
2025.

iv. (a) The management has represented

that, to the best of it''s knowledge
and belief, other than as disclosed
in the notes to the accounts,
no funds have been advanced
or loaned or invested (either
from borrowed funds or share
premium or any other sources or
kind of funds) by the company
to or in any other person(s) or
entity(ies), including foreign
entities ("Intermediaries"), with
the understanding, whether
recorded in writing or otherwise,
that the Intermediary shall,
whether, directly or indirectly
lend or invest in other persons
or entities identified in any
manner whatsoever by or on
behalf of the company ("Ultimate
Beneficiaries") or provide any
guarantee, security or the
like on behalf of the Ultimate
Beneficiaries;

(b) The management has
represented, that, to the best of
it''s knowledge and belief, other
than as disclosed in the notes to

the accounts, no funds have been
received by the company from any
person(s) or entity(ies), including
foreign entities ("Funding
Parties"), with the understanding,
whether recorded in writing or
otherwise, that the company
shall, whether, directly or
indirectly, lend or invest in other
persons or entities identified in
any manner whatsoever by or
on behalf of the Funding Party
("Ultimate Beneficiaries") or
provide any guarantee, security
or the like on behalf of the
Ultimate Beneficiaries; and

(c) Based on audit procedures which
we considered reasonable and
appropriate in the circumstances,
nothing has come to the notice
that has caused us to believe
that the representations under
sub-clause (i) and (ii) contain any
material misstatement.

v. The company has not declared or paid
any dividend during the year. Hence,
the provisions of section 123 of the
Companies Act, 2013 are not applicable.

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

for Atmakuri & Co

Chartered Accountants
Firm Registration No.: 000268S

T Vivekananda Reddy

Partner

Hyderabad, Membership No.: 237072

29^th December, 2025 UDIN: 25237072HOIHCX5708

---

Mar 31, 2024

We have audited the Standalone Financial Statements
of Gayatri Projects Limited ("the Company"), which
comprise the Balance Sheet as at 31^st March, 2024,
and the Statement of Profit and Loss (including Other
Comprehensive Income), the Statement of Changes
in Equity and the Statement of Cash Flows for the year
then ended, and notes to the Standalone Financial
Statements, including a summary of significant
accounting policies and other explanatory information
(hereinafter referred to as "the Standalone Financial
Statements").

In our opinion and to the best of our information and
according to the explanations given to us, the aforesaid
Standalone Financial Statements give the information
required by the Companies Act, 2013 ("the Act") in
the manner so required and give a true and fair view
in conformity with the Indian Accounting Standards
prescribed under section 133 of the Act read with the
Companies (Indian Accounting Standards) Rules, 2015,
as amended, ("Ind AS") and other accounting principles
generally accepted in India, of the state of affairs of the
Company as at 31^st March, 2024, and the Loss and other
comprehensive income, changes in equity and its cash
flows for the year ended on that date.

Basis for Opinion

We conducted our audit of the Standalone Financial
Statements in accordance with the Standards on
Auditing (SAs), as specified under Section 143(10) of
the Companies Act, 2013. Our responsibilities under
those standards are further described in the Auditor''s
Responsibilities for the Audit of the Standalone Financial
Statements section of our report.

We are independent of the Company in accordance
with the ''Code of Ethics'' issued by the Institute of
Chartered Accountants of India together with the
ethical requirements that are relevant to our audit
of the standalone financial statements under the
provisions of the Companies Act, 2013 and the Rules
made thereunder, and we have fulfilled our other
ethical responsibilities in accordance with these

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

Material Uncertainty Related to Going Concern

We draw attention to Note No. 34.28 of the audited
standalone financial statements which states that
during the year the company has incurred a loss of
''5301.82 Lakhs and complete erosion in the net worth
of the company as at 31^st March, 2024, default in
repayment of loans and other financial and other credit
facilities extended to the company by the lenders,
issue of various notices by lenders for recovery of their
dues etc., and the initiation of Corporate Insolvency
Resolution Process ("CIRP") against the company vide
order dated 15^th November, 2022 of Hon''ble National
Company Law Tribunal ("NCLT"), Hyderabad bench and
Interim Resolution Professional has been appointed and
subsequently confirmed as Resolution Professional. The
aforesaid factors indicate the existence of uncertainty
that may cast doubt about the company''s ability to
continue as a going concern as at 31^st March, 2024.
However, the Financial statements for the Financial Year
2023-24 have been prepared on a going concern basis
as the Hon''ble NCLT had stated that the operations of
the company to be continued as a going concern and
subsequently, as stated in Note no. 34.28 of the audited
standalone financial statements, the promoters of the
company have submitted a One Time Full & Final Debt
Settlement ("OTS") proposal with the lenders of the
company u/s 12A of Insolvency and Bankruptcy Code,
2016, and the same was accepted by 97.20 % of COC
members (Lenders) and subsequently, the Hon''ble
NCLT vide its order dated 10^th September, 2025 has
allowed for withdrawal of CIRP proceedings against the
company and Resolution Professional was discharged.
As stated in note no.34.28 of the audited standalone
Financial Statements, the company has paid the entire
fund-based amounts to the lenders as specified in the
OTS proposal u/s 12A as per IBC 2016.

Our Opinion is not modified in respect of the above
matter.

Emphasis of Matters

(Note No''s. referred hereunder are with reference
to respective Notes forming part of the Standalone
Financial Statements)

We draw attention to the following matters:

i) As stated in Note No. 34.1, regarding the claims
filed by lenders against Corporate Guarantees
held by them, performance and contractual
commitments given by the company for various
projects of the company which have been
recognized as contingent liabilities for reasons
stated in the said note.

ii) As stated in Note No. 34.17, the Investee Company
in which the Company has invested by way of
Compulsorily Convertible Cumulative Preference
Shares ("CCCPS"), has incurred considerable
losses and there is complete erosion of Net worth
as on 31^st March, 2024. However, no provision
for diminution / impairment for carrying value
of the investment is provided for the year ended
31^st March, 2024 for the reasons stated in the said
note.

iii) As stated in Note No. 34.18, provision has been
made during the previous financial year in respect
of the subordinate debt given to the associate
company. However, no provision has been made
in respect of the NCPS and unsecured loan
receivable from the said associate company for
the detailed reasons / explanations stated in the
said note.

iv) As stated in Note No. 34.19, the Inter Corporate
Loan grouped under ''Non-current Loans'' and
accumulated interest thereon is long pending for
recovery for which no provision has been made
for the detailed reasons stated in the said note.

v) As stated in Note No. 34.20, during the previous
financial year the company has made provision for
EPC trade receivables from subsidiary of associate
company for the detailed reasons stated in the
said note.

vi) As stated in Note No. 34.21, the amount receivable
from the erstwhile associate company is based on
the receipt of claims, which was received by the
erstwhile associate company during the financial
year 2024-25 and the same shall be recognized
in the financial year 2024-25 as stated in the said
note.

vii) As stated in Note No. 34.22, the work advances in
respect of certain contract works given to a sub¬
contractor grouped under ''Other Current Assets''
which are long pending for recovery.

viii) As stated in the Note No. 34.23, the company
has not made any provision for impairment on
its equity investment in wholly owned subsidiary
company and on unsecured loan given to the said
subsidiary company for the reasons stated in the
said note.

ix) As stated in the Note No.34.24, the recovery
of work & other advances and receivables got
delayed from one sub-contractor for the reasons
stated in the said note.

x) As stated in the Note No. 34.25, wherein it is
explained about the COVID - 19 Pandemic effects
and its impact on the business operations and
cash flows of the company which have caused
the company to default in its loan repayment
obligations to the lenders and various actions
taken by the lenders against the company. It is
further explained about the initiation of Corporate
Insolvency Resolution Process ("CIRP") against the
company as per the order of the Hon''ble National
Company Law Tribunal (NCLT), Hyderabad
bench vide its order dated 15th November, 2022
and the appointment of the Interim Resolution
Professional, later who has been confirmed as
the Resolution Professional of the company.
Subsequently, the promoters of the company have
submitted a One Time Full & Final Debt Settlement
("OTS") proposal with the lenders of the company
u/s 12A of Insolvency and Bankruptcy Code, 2016,
and the same was accepted by 97.20 % of COC
members (Lenders) and subsequently the Hon''ble
NCLT vide its order dated 10th September 2025
has allowed for withdrawal of CIRP proceedings
against the company and Resolution Professional
was discharged. As stated in note no.34.28 of the
audited standalone Financial Statements, the
company has paid the entire fund-based amounts
to the lenders as specified in the OTS proposal u/s
12A as per IBC 2016.

Our opinion is not modified in respect of these matters.
Key Audit Matters

Key audit matters are those matters that, in our
professional judgment, were of most significance in
our audit of the Standalone Financial Statements for
the year ended 31^st March, 2024. These matters were
addressed in the context of our audit of the Standalone
Financial Statements as a whole, and in forming our
opinion thereon, and we do not provide a separate
opinion on these matters. We have determined the
matters described below to be key audit matters to be
communicated in our report.

S. no.	Key Audit Matter	Audit Process
1	Revenue recognition and measurement of contract assets in respect of unbilled amounts The management of the company has applied significant judgement in determining the revenue to be recognised in case of performance obligation satisfied over a period of time; revenue recognition is done by measuring the progress towards complete satisfaction of performance obligation. Revenue is recognized on fixed price construction contracts in accordance with the percentage of completion basis, which necessarily involve technical estimates of the percentage of completion, and costs to completion, of each contract / activity, on the basis of which profits and losses are accounted. When the outcome of the contract is ascertained reliably, contract revenue is recognized at cost of work performed on the contract plus proportionate margin, using the percentage of completion method. Percentage of completion is the proportion of cost of work performed up to the date, to the total estimated contract costs. The stage of completion of contracts is measured by reference to the proportion that contract costs incurred for work performed up to the reporting date bear to the estimated total contract costs for each contract. Further at the reporting date, revenue is accrued for costs incurred against work performed and which are not billed and further measurement of work completed/cost incurred during the period for recognition of unbilled revenue.	We have obtained the procedure and process involved in estimating the percentage of completion of the projects. We have also obtained and verified the costs incurred on the project/works up to the reporting date for the revenues accounted in respect of works on sampling basis. We have also obtained the certified copies (i.e. percentage of completed work approved by the relevant authorities) of works executed till the reporting date in respect of revenues accounted on sampling basis. We have also performed analytical procedures for reasonableness of revenues recognised. We have also verified the reasonableness of the estimation of remaining costs to be incurred to complete the project/work in profit / loss estimated in the project/work. Reviewed the delivery and collection history of customers against whose contracts un¬ billed revenue is recognised Tested relevant contracts for measurement of work completed during the period for unbilled revenue.

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

The Company''s Board of Directors is responsible for
the preparation of the other information. The other
information comprises the information included in
the Management Discussion and analysis, Boards
Report including annexures to Board''s Report, Business
Responsibility Report, Corporate Governance and
Shareholder''s Information, but does not include the
Standalone Financial Statements and our auditor''s
report thereon.

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

In connection with our audit of the Standalone
Financial Statements, our responsibility is to read the
other information and, in doing so, consider whether
the other information is materially inconsistent with

the Standalone Financial Statements or our knowledge
obtained in the audit or otherwise appears to be
materially misstated.

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

Responsibilities of Management and those Charged
with Governance for the Standalone Financial
Statements

The Company''s Board of Directors is responsible for
the matters stated in Section 134(5) of the Companies
Act, 2013 ("the Act") with respect to the preparation
of these Standalone Financial Statements that give a
true and fair view of the financial position, financial
performance, total comprehensive income, changes
in equity and cash flows of the Company in accordance
with the accounting principles generally accepted in

India, including the Indian Accounting Standards (Ind
AS) specified under section 133 of the Act read with the
Companies (Indian Accounting Standards) Rules, 2015, as
amended.This responsibility also includes maintenance
of adequate accounting records in accordance with the
provisions of the Act for safeguarding of the assets of
the Company and for preventing and detecting frauds
and other irregularities; selection and application of
appropriate accounting policies; makingjudgments and
estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal
financial controls, that were operating effectively
for ensuring the accuracy and completeness of the
accounting records, relevant to the preparation and
presentation of the Standalone Financial Statements
that give a true and fair view and are free from material
misstatement, whether due to fraud or error.

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

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

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

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

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

• Identify and assess the risks of material
misstatement of the Standalone Financial
Statements, whether due to fraud or error, design

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

• Obtain an understanding of internal control
relevant to the audit in order to design
audit procedures that are appropriate in the
circumstances. Under section 143(3)(i) of the
Companies Act, 2013, we are also responsible for
expressing our opinion on whether the company
has adequate internal financial controls system
in place and the operating effectiveness of such
controls.

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

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

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

Materiality is the magnitude of misstatements in the
standalone financial statements that, individually or
in aggregate, makes it probable that the economic
decisions of a reasonably knowledgeable user of the
standalone financial statements may be influenced.
We consider quantitative materiality and qualitative

factors in (i) planning the scope of our audit work
and in evaluating the results of our work; and (ii) to
evaluate the effect of any identified misstatements in
the standalone financial statements.

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

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

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

Report on Other Legal and Regulatory Requirements

1) As required by the Companies (Auditor''s Report)
Order, 2020 ("the Order"), issued by the Central
Government of India in terms of sub-section (11)
of section 143 of the Companies Act, 2013, we give
in the "Annexure A" a statement on the matters
specified in paragraphs 3 and 4 of the Order, to
the extent applicable.

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

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

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

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

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

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

f) With respect to the adequacy of the
internal financial controls over financial
reporting of the Company and the operating
effectiveness of such controls, refer to our
separate Report in "Annexure B".

g) With respect to the other matters to
be included in the Auditors Report in
accordance with the requirements of
Section 197(16) of the Act, as amended, in our
opinion and to the best of our information
and according to the explanations given
to us, the company has paid or provided
for managerial remuneration for the year
ended 31^st March 2024 in accordance with
the requisite approvals mandated by the
provisions of section 197 of the Act read with
schedule V to the Act.

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

i. As stated in Note no. 34.1, of the
Standalone Financial Statements, the
Company has disclosed the impact
of pending litigations on its financial
position in its Standalone Financial
Statements.

ii. As per the information and
explanations given by the Company,
the Company did not have any long¬
term contracts including derivative
contracts for which there were any
material foreseeable losses.

iii. As per the information and explanations
given by the Company, there has been
no delay in transferring the amounts
which are required to be transferred to
Investor Education & Protection Fund.

iv. (a) The management has represented

that, to the best of it''s knowledge and
belief, other than as disclosed in the
notes to the accounts, no funds have
been advanced or loaned or invested
(either from borrowed funds or share
premium or any other sources or kind
of funds) by the company to or in any
other person(s) or entity(ies), including
foreign entities ("Intermediaries"), with
the understanding, whether recorded
in writing or otherwise, that the
Intermediary shall, whether, directly
or indirectly lend or invest in other
persons or entities identified in any
manner whatsoever by or on behalf of
the company ("Ultimate Beneficiaries")
or provide any guarantee, security
or the like on behalf of the Ultimate
Beneficiaries;

(b) The management has represented,
that, to the best of it''s knowledge
and belief, other than as disclosed in
the notes to the accounts, no funds
have been received by the company

from any person(s) or entity(ies),
including foreign entities ("Funding
Parties"), with the understanding,
whether recorded in writing or
otherwise, that the company shall,
whether, directly or indirectly, lend
or invest in other persons or entities
identified in any manner whatsoever
by or on behalf of the Funding Party
("Ultimate Beneficiaries") or provide
any guarantee, security or the like on
behalf of the Ultimate Beneficiaries;
and

(c) Based on audit procedures which we
considered reasonable and appropriate
in the circumstances, nothing has
come to the notice that has caused
us to believe that the representations
under sub-clause (i) and (ii) contain
any material misstatement.

v. The company has not declared or
paid any dividend during the year in
contravention of the provisions of
section 123 of the Companies Act, 2013.

for Atmakuri & Co

Chartered Accountants
Firm Registration No.: 000268S

T Vivekananda Reddy

Partner

Hyderabad, Membership No.: 237072

24^th December 2025 UDIN: 25237072EDBNYD1092

---

Mar 31, 2018

Report on the Standalone Ind AS Financial Statements

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

Management’s Responsibility for the Standalone Ind AS Financial Statements

The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these standalone Ind AS financial statements to give a true and fair view of the financial position, financial performance (including other comprehensive income), cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards prescribed under Section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015,(as amended). This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

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

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

We conducted our audit of the standalone Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards and pronouncements require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.

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

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

Opinion

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

Emphasis of Matters

(Note Nos. referred hereunder are with reference to respective Notes forming part of the standalone Ind AS financial statements)

We draw member’s attention to the following matters:

i) As stated in Note No. 31.16, Inter Corporate Deposits (ICD) grouped under “Non-Current Loans” and accumulated interest there on long pending for recovery.

ii) As stated in Note No.31.17, Considerable Work Advances in respect of certain Contract works given to sub-contracts grouped under “Other Current assets” which are long pending for recovery.

Our Opinion is not qualified in respect of the above matters.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2016, issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act (“the Order”), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the “Annexure A” a statement on the matters 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 explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit;

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

(c) The Balance Sheet, the Statement of Profit and Loss including other comprehensive income, the Statement of Cash Flows and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;

(d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act and Companies (Indian Accounting Standards) Rules, 2015, as amended;

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

(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure B”;

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

i. As stated in Note No.31.2 of the Standalone Ind AS financial statements, the Company has disclosed the impact of pending litigations on its standalone Ind AS financial statements.

ii. As per the information and explanations given by the Company, the Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.

iii. As per the information and explanations given by the Company, there has been no delay in transferring the amounts which are required to be transferred to Investor Education & Protection Fund.

iv. The disclosures regarding details of specified bank notes held and transacted during 8th November, 2016 to 30th December, 2016 has not been made since the requirement does not pertain to financial year ended 31st March, 2018.

The Annexure referred to in the Independent Auditors’ Report to the members of the Company on the standalone Ind AS financial statements for the year ended 31st March, 2018, we report that:

i. In respect of Fixed Assets:

a. In our opinion and as per the information and explanations given to us, the Company has maintained proper records showing particulars, including quantitative details and situation of fixed assets;

b. The management of the company has verified the fixed assets at reasonable intervals during the year. According to the information and explanations given to us, no material discrepancies were noticed on such physical verification.

c. According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company.

ii. According to the information and explanations given to us, the inventories have been physically verified during the year by the management. In our opinion, the frequency of such verification is reasonable. The discrepancies noticed on physical verification of inventories as compared to the book records, which in our opinion were not material, have been properly dealt with.

iii. According to information and explanations given to us, the Company has granted unsecured Loans of Rs.29,385.00 Lakhs to parties covered in the Register maintained under section 189 of the Companies Act, 2013. In respect of such loans,

a. In our opinion and according to information and explanations given to us, the terms and conditions of such loans given by the Company are not prima facie prejudicial to the interest of the company.

b. The Schedule of repayment of the principal and interest has not been stipulated as the principal amount is repayable on demand.

c. There is no repayment schedule and therefore there is no overdue amount.

iv. According to information and explanations given to us and in our opinion, the company has complied with the provisions of sections of 185 and 186 of the Act, to the extent applicable, in respect of grant of loans, making investments and providing guarantees and securities.

v. According to the information and explanations given to us, the Company has not accepted any deposits from public within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended) during the year. Accordingly the provisions of clause 3(v) of the Order are not applicable to the Company.

vi. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Records and Audit) Rules, 2014, as amended and prescribed by the Central Government under section 148(1) of the Companies Act, 2013, and are of the opinion that, prima facie, the prescribed cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

vii. In respect of statutory dues

a. According to the information and explanations given to us, and based on our examination of records of the Company, amounts deducted/ accrued in the books of accounts in respect of statutory dues including provident fund, income tax, value added tax, goods and service tax, cess and other material statutory dues have been regularly deposited during the year by the Company with appropriate statutory authorities.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees’ state insurance, income-tax, service tax, sales-tax, goods and service tax, duty of custom, duty of excise, value added tax, Cess and other material statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

c. According to the information and explanation given to us, there are no dues of Sales tax, Income Tax, Wealth Tax, Service Tax, Customs Duty, Goods and Service Tax, and Cess which have not been deposited as on 31st March, 2018 on account of any dispute, except the following:

Sl. No.	Name of the Statute	Name of the Tax Due	Forum where Dispute is pending	Amount Rs. in Lakhs	Financial Years
1	Mines and Minerals (Development and Regulation) Act, 1957	Department of Mines and Geology	Supreme Court	1,043.51	1998-99
2	Central Sales Tax Act, 1956 and Sales Tax Acts of Various States	Sales Tax/Vat	Appeals pending before High Courts of respective states and Appellate Tribunals and other appropriate authorities.	3,436.55	2001-02 and 2004-05 to 2009-10
3	Central Excise Act, 1944	Service Tax	Appeals pending before various Authorities	1,770.10	2007-08 to 2011-12
4	Income Tax Act, 1961	Income Tax	Appeal pending before CIT(Appeals)	1,649.70	2013-14 and 2015-16

viii. Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of loans or borrowings to any financial institution, bank or Government as on the Balance Sheet date.

ix. According to information and explanations given to us, the company has not raised moneys by way of public offer (including debt instruments). Based on our audit procedures and according to the information and explanations given to us, in our opinion, the Term loans availed by the Company were, prima facie, applied for the purpose for which they were obtained.

x. During the course of our examination of the books and records of the company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the company or on the company by its officers or employees, noticed or reported during the year, nor we have been informed of any such case by the management.

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

xii. As the Company is not a Nidhi Company, provisions of clause 3(xii) of the Order are not applicable to the Company.

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

xiv. The Company has made private placement of equity shares during the year. According to the information and explanations given to us, the private placement of equity shares are in compliance with the provisions of section 42 of the Act and the amounts raised have been used for the purpose of which they were raised and unutilized balance amount of Rs.360.44 Lakhs is available in the QIP Escrow Account.

xv. According to the information and explanations given to us and based on examination of records of the Company, the Company has not entered into any non-cash transaction with directors or persons connected with them. Hence, Clause 3(xv) of the Order is not applicable for the current year under report.

xvi. The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934 and accordingly, the provisions of Clause 3(xvi) of the Order are not applicable to the Company.

The Annexure referred to in the Independent Auditors’ Report to the members of the Company on the standalone Ind AS financial statements for the year ended 31st March 2018:

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

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

Management’s Responsibility for Internal Financial Controls

The Company’s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (‘ICAI’). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to Company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors’ Responsibility

Our responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the “Guidance Note”) and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.

The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

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

Meaning of Internal Financial Controls over Financial Reporting

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

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31st March 2018, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

for M O S & Associates LLP

Chartered Accountants

Firm Registration No.: 001975S/S200020

S V C Reddy

Place: Hyderabad Partner

Date: 30th May, 2018 Membership Number: 224028

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Mar 31, 2017

INDEPENDENT AUDITORS’ REPORT

To The Members of Gayatri Projects Limited

Report on the Standalone Ind AS Financial Statements

We have audited the accompanying standalone Ind AS financial statements of Gayatri Projects Limited (“the Company”), which comprise the Balance Sheet as at 31^st March, 2017, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Cash Flows and the Statement of Changes in Equity for the year then ended, and a summary of the significant accounting policies and other explanatory information. For the reasons detailed in Note No. 33.18 and 33.23 of the standalone Ind AS financial statements, the accompanying standalone Ind AS financial statements are the revised statements of the original Balance Sheet as at 31^st March, 2017, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Cash Flow and the Statement of Changes in Equity for the year then ended covered by our audit report dated 29^th May, 2017 and approved by the Board of Directors of the Company held on 29^th May, 2017.

Management’s Responsibility for the Ind AS Financial Statements

The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these standalone Ind AS financial statements to give a true and fair view of the financial position, financial performance (including other comprehensive income), cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards prescribed under Section 133 of the Act read with Rule 7 of the Companies (Accounts) Rules, 2014 and Companies (Indian Accounting Standards) Rules, 20l5,(as amended). This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Standalone Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

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

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

We conducted our audit of the standalone Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(1 0)of the Act and other applicable authoritative pronouncements issued by the Institute of Chartered Accountants of India. Those Standards and pronouncements require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.

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

We believe that the audit evidence obtained by us and other auditors in terms of their reports referred to in the Other Matters paragraph below is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, and based on the consideration of reports of the other auditors on separate financial statements of the merged companies as referred to in Other Matters paragraph below, the aforesaid standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31^st March, 2017 and its profit including other comprehensive income, its cash flows and the changes in equity for the year ended on that date..

Emphasis of Matters

(Note Nos. referred hereunder are with reference to respective Notes forming part of the standalone Ind AS financial statements)

We draw member’s attention to the following matters:

i) As stated in Note No.33.19 regarding loans given to some of the sub-contractors and accumulated interest thereon which are long pending for recovery.

ii) As stated in Note No.33.20 regarding certain Contract and work advances given to some of the sub-contractors which are long pending for recovery.

iii) As stated in Note No. 33.18(f)(i), pursuant to Composite Scheme of Arrangement (‘Scheme’), the consideration receivable by the Company in the form of Equity and Preference Shares amounting to ''180,16,03,000 (Rupees One Hundred and Eighty Crores Sixteen Lakhs and Three Thousand Only) have been grouped under Investments in the revised standalone financial statements although the shares are yet to be issued and allotted by the resulting company.

Our Opinion is not qualified in respect of the above matters.

Other Matters

(Note Nos. referred hereunder are with reference to respective Notes forming part of the standalone Ind AS financial statements)

a. As stated in Note No.33.18 and 33.23, pursuant to Composite Scheme of Arrangement (‘Scheme’) approved by the Hon’ble National Company Law Tribunal (NCLT), Hyderabad Bench vide its order dated 3^rd November, 2017, the revised standalone Ind AS financial statements for the year ended 3 1^st March, 2017 were prepared and presented by the Company’s management by giving effect to the Scheme, having an appointed date for merger as 1^st April, 2016 and demerger as 31^st March, 2017, in the place of original standalone Ind AS financial statements approved by the Board of Directors of the Company held vide their meeting dated 29^th May, 20l7.Consequently, our original audit report dated 29^th May, 2017 on the standalone Ind AS financial statements of the Company for the year ended 3 1^st March, 2017 is revised by this report.

b. As stated in Note No. 33.18 (a) &(c), we have relied on the audited (by other auditors) financial statements of M/s. Gayatri Infra Venture Limited (GIVL), a merged company as per the approved Scheme. We have not conducted audit on the said financial statements of GIVL and our report in terms of sub section (3) and (11) of Section 143 of the Act, in so far as it relates to the aforesaid GIVL, is based solely on the reports of such other auditors.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2016, issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act (“the Order”), and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we give in the “Annexure A” a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required by Section l43 (3) of the Act, and based on the consideration of reports of the other auditors on separate financial statements of the merged companies as referred to in Other Matters paragraph above, we report that:

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

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books and reports issued by other auditors;

(c) The Balance Sheet, the Statement of Profit and Loss including other comprehensive income, the Statement of Cash Flows and the Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;

(d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act and Companies (Indian Accounting Standards) Rules, 2015, as amended;

(e) On the basis of the written representations received from the directors as on March 3l, 2017 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2017 from being appointed as a director in terms of Section l64 (2) of the Act;

(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure B”;

(g) With respect to the other matters to be included in the Auditors’ Report in accordance with Rule 1 1 of the Companies (Audit and Auditors) Rules, 2014, as amended, in our opinion and to the best of our knowledge and belief and according to the information and explanations given to us:

i. As stated in Note No.33.2 of the Standalone Ind AS financial statements, the Company has disclosed the impact of pending litigations on its standalone Ind AS financial statements.

ii. As per the information and explanations given by the Company, the Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses.

iii. As per the information and explanations given by the Company, there has been no delay in transferring the amounts which are required to be transferred to Investor Education & Protection Fund.

iv. The Company has provided requisite disclosures in Note No. 33.17 to the standalone Ind AS financial statements as to the holding of Specified Bank Notes on 8^th November, 2016 and 30^th December, 2016 as well as dealing in Specified Bank Notes during the period from 8^th November, 2016 to 30^th December,

2016. Based on audit procedures and relying on the management representation regarding the holding and nature of cash transactions, including Specified Bank Notes, we report that the disclosures are in accordance with books of account maintained by the Company and as produced to us by the Company’s Management.

The Annexure referred to in the Independent Auditors’ Report to the members of the Company on the standalone Ind AS financial statements for the year ended 3 1^st March, 2017, we report that:

(i). In respect of Fixed Assets:

a. In our opinion and as per the information and explanations given to us, the Company has maintained proper records showing particulars, including quantitative details and situation of fixed assets;

b. The management of the company has verified the fixed assets at reasonable intervals during the year. According to the information and explanations given to us, no material discrepancies were noticed on such physical verification.

c. According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties are held in the name of the Company.

(ii). According to the information and explanations given to us, the inventories have been physically verified during the year by the management. In our opinion, the frequency of such verification is reasonable. The discrepancies noticed on physical verification of inventories as compared to the book records, which in our opinion were not material, have been properly dealt with.

(iii). According to information and explanations given to us, the Company has granted unsecured Loans of ''3 1,9 19.83 lakhs to parties covered in the Register maintained under section l89 of the Companies Act, 2013. In respect of such loans,

a. In our opinion and according to information and explanations given to us, the terms and conditions of such loans given by the Company are not prima facie prejudicial to the interest of the company.

b. The Schedule of repayment of the principal and interest has not been stipulated as the principal amount is repayable on demand.

c. There is no repayment schedule and therefore there is no overdue amount.

(iv). According to information and explanations given to us and in our opinion, the company has complied with the provisions of sections of 185 and 186 of the Act, to the extent applicable, in respect of grant of loans, making investments and providing guarantees and securities.

(v). According to the information and explanations given to us, the Company has not accepted any deposits from public within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended) during the year. Accordingly the provisions of clause (v) of paragraph 3 of the Order are not applicable to the Company.

(vi). We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Records and Audit) Rules, 2014, as amended and prescribed by the Central Government under section 148( 1) of the Companies Act, 2013, and are of the opinion that, prima facie, the prescribed cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

(vii). In respect of statutory dues

a. According to the information and explanations given to us, and based on our examination of records of the Company, amounts deducted/ accrued in the books of accounts in respect of statutory dues including provident fund, income tax, value added tax, cess and other material statutory dues have been regularly deposited during the year by the Company with appropriate statutory authorities.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, employees’ state insurance, income-tax, service tax, sales-tax, duty of custom, duty of excise, value added tax, Cess and other material statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable.

c. According to the information and explanation given to us, there are no dues of Sales tax, Income Tax, Wealth Tax, Service Tax, Customs Duty and Cess which have not been deposited as on 31st March, 2017 on account of any dispute, except the following:

(viii) Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of loans or borrowings to any financial institution, bank or Government.

Sl. No.	Name of the Statute	Name of the Tax Due	Forum where Dispute is pending	Amount '' in Lakhs
1	Mines and Minerals (Development and Regulation) Act, 1957	Department of Mines and Geology	Supreme Court	1,043.51
2	Central Sales Tax Act, 1956 and Sales Tax Acts of Various States	Sales Tax/Vat	Appeals pending before High Courts of respective states and Appellate Tribunals and other appropriate authorities.	3,436.55
3	Central Excise Act, 1944	Service Tax	Appeals pending before various Authorities	1894.28
4	Income Tax Act, 1961	Income Tax	Appeal pending before CIT(Appeals)	307.12

(ix) According to information and explanations given to us, the company has not raised moneys by way of public offer (including debt instruments). Based on our audit procedures and according to the information and explanations given to us, in our opinion, the Term loans availed by the Company were, prima facie, applied for the purpose for which they were obtained.

(x) During the course of our examination of the books and records of the company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of material fraud by the company or on the company by its officers or employees, noticed or reported during the year, nor we have been informed of any such case by the management.

(xi) In our opinion and according to the information and explanations given to us, the company has paid or provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section l97 read with Schedule V to the Act.

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

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

(xiv) According to the information and explanations given to us and based on examination of records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year. Hence, paragraph 3 (xiv) of the Order is not applicable for the current year under audit.

(xv) According to the information and explanations given to us and based on examination of records of the Company, the Company has not entered into any non-cash transaction with directors or persons connected with them. Hence paragraph 3(xv) of the Order is not applicable for the current year under report.

(xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934 and accordingly, the provisions of Clause 3(xvi) of the Order are not applicable to the Company.

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

We have audited the internal financial controls over financial reporting of Gayatri Projects Limited (“the Company”) as of 31^st March 2017 in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

The Company’s management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India (‘ICAI’). These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to Company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors’ Responsibility

Our responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls over Financial Reporting (the “Guidance Note”) and the Standards on Auditing, issued by ICAI and deemed to be prescribed under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.

The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

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

Meaning of Internal Financial Controls over Financial Reporting

A Company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at 31^st March 2017, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

For M O S & ASSOCIATES LLP

Chartered Accountants

Firm''s Registration No.: 00I975S/S200020

S V C REDDY

Place: Hyderabad Partner

Date: 06^th December, 2017 Membership Number: 224028

---

Mar 31, 2016

To The Members of Gayatri Projects Limited.

Report on the Consolidated Financial Statements

We have audited the accompanying consolidated financial statements of Gayatri Projects Limited ("the holding Company") and its subsidiaries (the Holding Company and its subsidiaries together referred to as "the Group"), its associates and jointly controlled entities, comprising the Consolidated Balance Sheet as at 31st March 2016, the Consolidated Statement of Profit and Loss and the Consolidated Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information (herein after referred to as "the consolidated financial statements").

Management’s Responsibility for the Consolidated Financial Statements

The Holding Company’s Board of Directors is responsible for the preparation of these consolidated financial statements in terms of requirements of the Companies Act, 2013 ("the Act") that give a true and fair view of the consolidated financial position, consolidated financial performance and consolidated cash flows of the Group including its associates and jointly controlled entities in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 (as amended). The respective Board of Directors of the companies included in the Group and of its associates and jointly controlled entities are responsible for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Group and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error, which have been used for the purpose of preparation of the consolidated financial statements by the directors of the Holding Company, as aforesaid.

Auditors’ Responsibility

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

While conducting the audit, we have taken into account the provisions of the Act, the accounting and auditing

standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under.

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

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

We believe that the audit evidence we have obtained and the audit evidence obtained by the other auditors in terms of their reports referred in point no. a, b and c of the Other Matters paragraph below, is sufficient and appropriate to provide a basis for our audit opinion on the consolidated financial statements.

Basis for qualified Opinion

In stated in note no. 30.20, M/s Gayatri Infra Ventures Limited (GIVL), a subsidiary of the company, has entered into a definitive sale agreement for divestment of its entire equity stake amounting to Rs. 4606.09 lakhs held in Western UP Tollway Limited, a jointly controlled entity of GIVL. The Independent Auditors of GIVL in their audit report on consolidated financial statements of GIVL have qualified the above said matter by stating that pending final outcome of the said process, they are unable to comment upon the consequential effects, if any, of the said matter, on the financial statements of GIVL.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, except for the effects of Matter described in the Basis for Qualified Opinion paragraph above, the aforesaid consolidated financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the consolidated state of affairs of the Group, its associates and jointly controlled entities as at 31st March 2016, and their consolidated profit and their consolidated cash flows for the year ended on that date.

Emphasis of Matters

(Note Nos. referred hereunder is with reference to respective Notes forming part of the consolidated financial statement)

We draw member’s attention to the following matters:

Note No.30.14 & 30.15 regarding certain loans & advances and work advances given to some of the sub-contractors which are long pending for recovery.

Our Opinion is not qualified in respect of the above matters. Other Matters :

a. We did not audit the financial statements / consolidated financial statements of three subsidiaries whose financial statements / consolidated financial statements reflect total assets (net) of Rs. 3,91,971.25 lakhs as at 31st March 2016, total revenues (net) of Rs. 27,564.70 lakhs and net cash outflows amounting to Rs. 3021.01 lakhs for the year ended on that date. These financial statements / consolidated financial statements have been audited by other auditors whose audit reports have been furnished to us by the management and our opinion on the consolidated financial statements, in so far as it relates to the amounts and disclosures in respect of these subsidiaries, and our report in terms of sub section (3) and (11) of Section 143 of the Act, in so far as it relates to the aforesaid subsidiaries, is based solely on the reports of the other auditors.

b. We did not audit the financial statements of two associates in which the share of loss of the Group is Rs.176.66 lakhs. These financial statements have been audited by other auditors whose audit reports have been furnished to us by the management and our opinion on the consolidated financial statements, in so far as it relates to the amounts and disclosures in respect of these associates, and our report in terms of sub section (3) and (11) of Section 143 of the Act, in so far as it relates to the aforesaid associates, is based solely on the reports of the other auditors.

c. We did not audit the financial statements of six joint ventures / jointly controlled entities whose financial statements to the extent of company’s share reflected in the consolidated financial statements with a total assets of Rs. 6,926.67 lakhs as at 31st March 2016, total revenues of Rs. 18,086.36 lakhs and net cash outflows amounting to Rs. 36.26 lakhs for the year ended on that date. These financial statements have been audited by other auditors and have been furnished to us by the management and our opinion on the consolidated financial statements, in so far as it relates to the amounts and disclosures included in respect of these joint ventures, and our report in terms of sub section (3) and (11) of Section 143 of the Act, in so far as it relates to the aforesaid joint ventures, is based solely on such financial statements.

d. We have relied on the unaudited (management certified) financial statements of four joint ventures whose financial statements to the extent of company’s share reflected in the consolidated financial statements with a total assets of Rs. 9,494.13 lakhs as at 31st March 2016, total revenues of Rs. 84.11 lakhs and net cash outflows amounting to Rs. 370.21 lakhs for the year ended on that date. These financial statements/financial information are unaudited and have been furnished to us by the management and our opinion on the consolidated financial statements, in so far as it relates to the amounts and disclosures included in respect of these joint ventures, and our report in terms of sub section (3) and (11) of Section 143 of the Act, in so far as it relates to these joint ventures, is based solely on such unaudited financial statements/financial information.

Our opinion on the consolidated financial statements, and our report on other Legal and Regulatory Requirements below, is not modified in respect of the above matters with respect to our reliance on the work done and reports of the other auditors and the financial statements / financial information certified by the management.

Report on Other Legal and Regulatory Requirements

1. As required by Section 143 (3) of the Act, and based on the auditor’s report of the subsidiaries, associates and jointly controlled entities, we report, to the extent applicable, that:

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

b. In our opinion, proper books of accounts as required by law relating to preparation of the consolidated financial statements have been kept so far as it appears from our examination of those books and the reports of the other auditors;

c. The Consolidated financial statements dealt with by this Report are in agreement with the relevant books of account maintained for the purpose of

preparation of the consolidated financial statements;

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

e. On the basis of the written representations received from the directors of holding company as on 31st March, 2016 taken on record by the board of directors of the holding company and reports of the statutory auditors of its subsidiary companies and associate companies, none of the directors of the Group Companies and its associate companies incorporated in India is disqualified as on 31st March 2016 from being appointed as a director in terms of Section 164

(2) of the Act.;

f. The qualification relating to the maintenance of accounts and other matters connected therewith are as stated in the basis for qualified opinion paragraph;

g. With respect to the adequacy of the internal financial controls over financial reporting and the operating effectiveness of such controls, refer to our separate report in "Annexure A", which is based on the auditors’ reports of the Holding

Company, subsidiary companies and associate companies; and

h. With respect to the other matters to be included in the Auditor’s Report in accordance with Rule

11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our knowledge and belief and according to the information and explanations given to us:

i. The Group, its associates and jointly controlled entities have disclosed the impact of pending litigations on its consolidated financial position, as stated in Note No. 19 & 30.4.

ii. The Group, its associates and jointly controlled entities did not have any material foreseeable losses relating to long-term contracts including derivative contracts.

iii. The amounts which are required to be transferred to Investor Education & Protection Fund by the Holding Company have been transferred and there were no amounts which were required to be transferred to Investor Education & Protection Fund by the subsidiary and associate companies.

Annexure "A" to Independent Auditor’s Report

(Referred to in paragraph 1(g) under the heading of ‘Report on Other Legal and Regulatory Requirements’ of our report of even date)

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

We have audited the internal financial controls over financial reporting of Gayatri Projects Limited ("the holding Company") and its subsidiaries (the Holding Company and its subsidiaries together referred to as "the Group") and its associate as of 31st March 2016 in conjunction with our audit of the consolidated financial statements of the Holding Company for the year ended on that date.

Management’s Responsibility for Internal Financial Controls

The respective Board of Directors of the Holding Company, its subsidiary companies and associate companies, which are companies incorporated in India, are responsible for establishing and maintaining Internal Financial Controls based on the Internal Control over Financial Reporting criteria established by the respective Companies considering the essential components of Internal Control stated in 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 of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to the Company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditors’ Responsibility

Our responsibility is to express an opinion on the internal financial controls over financial reporting of the Holding Company, its subsidiary companies and associate companies, which are companies incorporated in India, based on our audit.

We conducted our audit in accordance with the Guidance Note issued by the Institute of Chartered Accountants of India (‘ICAI’) and the Standards on Auditing, prescribed under Section 143(10) of the Act , to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting were established and maintained and if such controls operating effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial control system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditors’ judgment including the assessment of the risk of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained and the audit evidence obtained by the other auditors, in terms of their reports referred in the Other Matters paragraph below, is sufficient and appropriate to provide a basis for our audit opinion on the internal financial control system over financial reporting of the Holding Company, its subsidiary and associate companies as aforesaid.

Meaning of Internal Financial Controls over Financial Reporting

A Company’s internal financial control system over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with Generally Accepted Accounting Principles (GAAP). A Company’s internal financial control system over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorization of the Management and Directors’ of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s Assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial control system over financial reporting, including the possibility of collusion or improper management override of controls, material misstatement due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial control system over financial reporting to future periods are subject to the risk that the internal financial control system over financial reporting may become inadequate because of the changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Opinion

In our opinion, to the best of our information and according to the explanations given to us, the Holding Company, its subsidiary and associate companies, have, in all material respects, adequate internal financial control system over financial reporting and such internal financial control system over financial reporting were operating effectively as at 31st March 2016, based on the internal financial control system over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance note on Audit of Internal Financial Control over Financial Reporting issued by the Institute of Chartered Accountants of India.

Other Matters

We did not audit the Internal Financial Controls over Financial Reporting insofar as it relates to three subsidiaries whose financial statements / consolidated financial statements reflect total assets (net) of Rs. 3,91,971.25 lakhs as at 31st March 2016, total revenues (net) of Rs. 27,564.70 lakhs and net cash outflows amounting to Rs. 3,021.01 lakhs for the year ended on that date; and two associates, in respect of which, the share of loss of the Group is Rs. 176.66 lakhs for the year ended 31st March 2016 has been considered in the consolidated financial statements. Our report on the adequacy and operating effectiveness of the Internal Financial Controls over Financial Reporting for the Holding Company, its subsidiary and associate companies, under section 143(3)(i) of the Act insofar as it relates to the aforesaid subsidiaries and associates, is solely based on the corresponding reports of the auditors of such companies.

For M O S & ASSOCIATES LLP

Chartered accountants

Firm’s Registration No.: 001975S/S200020

S V C REDDY

Place: Hyderabad Partner

Date: 30^th May 2016 Membership No.: 224028

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Mar 31, 2015

Report on the Standalone Financial Statements

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

Management's Responsibility for the Standalone Financial Statements

The Company's Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the Act") with respect to the preparation of these standalone financial statements to give a true and fair view of the financial position and financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of accounting records, relevant to the preparation and presentation of these financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor's Responsibility

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

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

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

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give a true and fair view, in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on whether the Company has in place an adequate internal financial controls system over financial reporting and the operating effectiveness of such controls. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company's Directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March 2015, and its profit and cash flows for the year ended on that date.

Emphasis of Matters

(Note Nos. referred hereunder are with reference to respective Notes forming part of the standalone financial statement)

We draw member's attention to the following matters:

i) Note No.31.12 regarding excess managerial remuneration paid by the company.

ii) Note No.31.21 & 31.23 regarding recovery of loans & Advances and work advances given to some of the sub- contractors.

iii) Note No.31.22 regarding conversion of long pending Trade Receivables of Rs.218.51 crores for which necessary statutory formalities / compliances are pending.

iv) Note No.31.26 regarding pending confirmation of balances in respect of certain items and balances reported in the financial statements.

Our Opinion is not qualified in respect of the above matters.

Report on Other Legal and Regulatory Requirements

1. As required by 'the Companies (Auditor's Report) Order, 2015', issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act (hereinafter referred to as the "Order"), we give in the Annexure a statement on the matters 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 explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;

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

c. The Balance Sheet, the Statement of Profit and Loss and the cash flow statement dealt with by this Report are in agreement with the books of account;

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

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

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

i. As stated in Note No. 19 & 31.2(a) & (d), the company has disclosed the impact of pending litigations on its standalone financial position.

ii. As per the information and explanations given by the company, the Company did not have any long- term contracts including derivative contracts for which there were any material foreseeable losses.

iii. As per the information and explanations given by the company, the amounts which are required to be transferred to Investor Education & Protection Fund have been transferred.

ANNEXURE TO THE INDEPENDENT AUDITOR'S REPORT

(Referred to in paragraph 1 under 'Report on Other Legal and Regulatory Requirements' section of our report of even date)

i) In respect of Fixed Assets:

a. In our opinion and as per the information and explanations given to us, the Company has maintained proper records showing particulars, including quantitative details and situation of fixed assets;

b. The management of the company has verified the fixed assets at reasonable intervals during the year. According to the information and explanations given to us, no material discrepancies were noticed on such physical verification.

ii) In respect of Inventory:

a. According to the information and explanations given to us, the inventories have been physically verified during the year by the management. In our opinion, the frequency of such verification is reasonable.

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

c. The Company has maintained proper records of inventories. As explained to us, the material discrepancies noticed on physical verification of inventories as compared to the book records has been properly dealt with.

iii) According to information and explanations given to us, the Company has granted unsecured Loans of Rs.11,196.73 lakhs to parties covered in the Register maintained under section 189 of the Companies Act, 2013. In respect of such loans,

a. The principal amount is repayable on demand

b. There is no repayment schedule and therefore there is no overdue amount.

iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the company and the nature of its business for the purchase of inventories, fixed assets and for sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in such internal control system. However, the internal controls over accounting of consumption and procurement of materials, wastages, material reconciliation need further strengthening.

v) According to the information and explanations given to us, the Company has not accepted any deposits from public within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly the provisions of clause (v) of paragraph 3 of the Order are not applicable to the Company.

vi) We have broadly reviewed the cost records maintained by the Company pursuant to the Companies (Cost Records and Audit) Rules, 2014, as amended and prescribed by the Central Government under section 148(1) of the Companies Act, 2013, and are of the opinion that, prima facie, the prescribed cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

vii) In respect of statutory dues:

a. According to the information and explanations given to us, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Sales Tax, Income Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty and Cess with the appropriate authorities during the year. We further state that the undisputed amounts payable in respect thereof outstanding as on 31.03.2015 for a period of more than six months from the date they became payable are as follows:

S.No Name of the Statutory Due Amount in Rs. Delay period

1 Service tax 38.22 lakhs > 6 months

b. According to the information and explanation given to us, there are no dues of Sales tax, Income Tax, Wealth Tax, Service Tax, Customs Duty and Cess which have not been deposited as on 31st March, 2015 on account of any dispute, except the following:

Sl. Name of the Statute Name of the Tax Forum where Dispute Amount Rs. No. Due is pending in Lakhs

1 Mines and Minerals (Development Department of Supreme Court and Regulation) Act, 1957 Mines and 1,043.51 Geology

2 Central Sales Tax Act, 1956 and Sales Tax/Vat Appeals pending before High 3,436.55 Sales Tax Acts of Various States Courts of respective states and Appellate Tribunals and other appropriate authorities.

3 Central Excise Act, 1944 Service Tax Appeals pending before 1,168.69 various Authorities

4 Income Tax Act, 1961 Income Tax Appeal pending before 8,968.58 CIT(Appeals)

c. As per the information and explanations given by the company, the amounts which are required to be transferred to Investor Education & Protection Fund as on 31.03.2015 have been transferred.

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

ix) Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has been regular in repayment of dues to banks and financial institutions except in some cases as stated below. The period and amount of continuing default as on the Balance Sheet date is as follows:

Long Term Loans:

Nature of the Loan Period of Default Default amount (Rs. in lakhs) Principal Interest

Term Loans from Banks Up to 30 days 213.33 21.15

Term Loans from Banks 31 to 60 days 679.57 282.56

Short Term Loans:

Nature of the Loan Period of Default Default amount (Rs. in lakhs) Principal Interest

Working Capital from Banks Up to 30 days - 620.51

Working Capital from Banks 31 to 60 days - 1317.85

Letter of Credit Facilities from Banks Up to 30days 19.72 -

Letter of Credit Facilities from Banks 31 to 60 days 1781.25 -

x) In our opinion and according to the information and explanations given to us, the terms and conditions of the guarantees given by the Company for loans taken by others from Banks or Financial Institutions are not, prima- facie, prejudicial to the interests of the Company.

xi) Based on our audit procedures and according to the information and explanations given to us, in our opinion, the Term loans availed by the Company were, prima facie, applied for the purpose for which they were obtained.

xii) In our opinion and according to the information and explanations given to us and on our examination of books and records, no fraud on or by the Company has been noticed or reported during the year.

For M O S & Associates LLP

(Formerly M O S & Associates)

Chartered Accountants

Firm Registration No.: 001975S/S200020

S. V. C. Reddy

Place: Hyderabad Partner

Date: 30th May 2015 Membership Number: 224028

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Mar 31, 2014

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

Management''s Responsibility for the Financial Statements

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

Auditor''s Responsibility

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

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

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Basis for Qualified Opinion:

We invite the attention of members to the following material matters: (Note Nos. referred hereunder are with reference to respective Notes forming part of the financial statements)

i) With regard to non-provision of Joint Venture losses:

As stated in Note no.30.5, regarding non provision for its share of joint venture losses by the Company amounting to Rs.46.30 Crores (Previous Year Rs.46.30 Crores). Had the provision been made for the losses, the reserves and surplus and the short term loans and advances of the Company would have been lower by Rs.46.30 Crores (Previous Year Rs.46.30 Crores). This was also a subject matter of qualification in the auditors'' report for the year ended 31st March, 2013 which was audited by the previous auditors of the Company

Qualified Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements subject to matters specified in qualified opinion paragraph and emphasis of matter paragraph give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31,2014;

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

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

Emphasis of Matter

We draw attention of the members to Note no. 30.21 regarding pending confirmation of balances in respect of certain items and balances reported in the financial statements. Our opinion is not qualified in respect of this matter.

Other Matter

The financial statements of the Company as at and for the year ended 31st March 2013 have been audited by the Company''s previous auditor; whose report dated 28th May 2013 expressed qualified opinion in respect of joint venture losses. The balances as at 31st March 2013 as per the audited financial statements, regrouped and / or reclassified wherever necessary, have been considered as opening balances for the purpose of these financial statements.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2003 ("the Order") issued by the Central Government of

India in terms of sub-section (4A) of section 227 of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

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

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

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

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

d) in our opinion, the Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement comply with the Accounting Standards notified under the Act read with the General Circular 15/2013 dated 13th September, 2013 of the Ministry of the Corporate Affairs in respect of section 133 of the Companies Act, 2013;

e) on the basis of written representations received from the directors as on March 31, 2014 and taken on record by the Board of Directors, none of the directors are disqualified as on March 31, 2014, from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.

ANNEXURE TO INDEPENDENT AUDITORS'' REPORT (Referred to in paragraph 1 under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date)

i. In respect of its Fixed Assets:

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

b. The fixed assets have been physically verified during the year by the management and according to the information and explanations given to us, no material discrepancies were noticed on such verification.

c. In our opinion, the Company has not disposed off substantial part of its fixed assets during the year under report and the going concern status of the Company is not affected.

ii. In respect of its inventories:

a. According to the information and explanations given to us, the inventories have been physically verified during the year by the management. In our opinion, the frequency of such verification is reasonable.

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

c. The Company has maintained proper records of inventories. As explained to us, the material discrepancies noticed on physical verification of inventories as compared to the book records has been properly dealt with.

iii. In respect of the Loans secured or unsecured, granted or taken by the company to/from companies, firms or other parties covered in the register maintained u/s 301 of the Companies Act, 1956:

a. The Company has granted unsecured loans to four parties covered in the register maintained under section 301 of the Companies Act, 1956. At the year end the balance of loans granted to such parties was '' 13897.17 lakhs and the maximum balance outstanding during the year was Rs. 13897.17 Lakhs.

b. In our opinion and according to information and explanations given to us, the terms and conditions of such loans given by the Company are not prima facie prejudicial to the interest of the company.

c. The principal amount is repayable on demand and there is no repayment schedule and therefore there is no overdue amount.

d. The Company has not taken any loans secured or unsecured, from companies, firms, other parties listed in the register maintained under section 301 of the Companies Act, 1956. Therefore the provisions of sub- clauses (f) and (g) of clause 4(iii) of the Order are not applicable to the Company.

iv. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the company and the nature of its business for the purchase of inventories, fixed assets and for sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in such internal control system. However, the internal controls over accounting of consumption and procurement of materials, wastages, material reconciliation need further strengthening.

v. In respect of the contracts or arrangements referred to in section 301 of the Companies Act, 1956:

a. In our opinion and according to the information and explanation given to us, the transactions made in pursuance of contracts or arrangements, that need to be entered in the register maintained under section 301 of the Companies Act, 1956 have been so entered.

b. In our opinion and according to the information and explanation given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies Act, 1956 and exceeding the value of Rs. 5 lakhs in respect of each party during the year have been made at prices which are prima facie reasonable having regard to the prevailing market prices at the relevant time.

vi. According to the information and explanations given to us, the Company has not accepted any deposits from public within the meaning of Sections 58A, 58AA or any other relevant provisions of the Act and rules framed there under. Hence the provisions of clause (vi) of paragraph 4 of the Order are not applicable to the Company.

vii. In our opinion, the internal audit system of the Company though broadly commensurate with the size of the Company and nature of its business, the same needs to be further strengthened for better effectiveness and control.

viii. According to the information and explanations given to us, the Company is in the process of updating cost records in respect of its construction activities for which the maintenance of cost records have been prescribed u/s 209(1)(d) of the Companies Act, 1956 pursuant to the Companies (Cost Accounting Rules) Rules, 2011 notified by the Central Government of India.

ix. In respect of statutory dues:

a. According to the information and explanations given to us, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Investor education and protection fund, Sales Tax, Income Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty and Cess with the appropriate authorities during the year.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of aforesaid dues were outstanding as at 31st March, 2014 pending for a period of more than six months from the date they became payable.

c. According to the information and explanation given to us, there are no dues of Sales tax, Income Tax, Wealth Tax, Service Tax, Customs Duty and Cess which have not been deposited as on 31st March, 2014 on account of any dispute, except the following:

Sl. Name of the Statute Name of the Tax Forum where Dispute Amount Rs. No. Due is pending in Lakhs

1 Mines and Minerals (Development Department of Supreme Court has directed 1,043.51 and Regulation) Act, 1957 Mines and Department of Mines and Geology Geology to re-assess the seginorage

2 Central Sales Tax Act, 1956 and Sales Tax/Vat Appeals pending before 3,436.55 Sales Tax Acts of Various States various states

3 Central Excise Act, 1944 Service Tax Appeals pending before 1,168.69 various states

4 Income Tax Act, 1961 Income Tax Appeal pending before 4,955.00 CIT(Appeals)

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

xi. Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has been regular in repayment of dues to any banks and financial institutions except in some cases as stated below.The period and amount of continuing default as on the Balance Sheet date is as follows:

Long Term Loans:

Nature of the Loan Period of Default Default amount (Rs.in lakhs) Principal Interest

Term Loans from Banks Upto 30 days 5,261.25 1,263.34

Term Loans from Banks 31 to 60 days 1,261.25 481.84

Short Term Loans :

Nature of the Loan Period of Default Default amount (Rs.in lakhs) Principal Interest

Term Loans and Working Capital from Banks Upto 30 days 10,000.00 234.09

Term Loans and Working Capital from Banks 31 to 60 days — 231.50

xii. In our opinion and according to the information and explanation given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities. Hence clause (xii) of paragraph 4 of the Order is not applicable.

xiii. In our opinion, the Company is not a chit fund or a nidhi, mutual benefit fund/society. Therefore clause (xiii) of paragraph 4 of the Order is not applicable to the Company.

xiv. In our opinion, the Company is not dealing or trading in shares, securities, debentures and other investments. Accordingly, the clause (xiv) of paragraph 4 of the Order is not applicable to the Company.

xv. In our opinion and according to the information and explanations given to us, the terms and conditions of the guarantees given by the Company for loans taken by others from Banks or Financial Institutions are not prima-facie prejudicial to the interests of the Company.

xvi. Based on our audit procedures and according to the information and explanations given to us, in our opinion, Term loans availed by the Company was, prima facie, applied for the purpose for which they were obtained.

xvii. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we are of the opinion that an amount of Rs.22,622.11 lakhs raised on short term basis have been used for long term investment.

xviii. According to the information and explanation given to us, during theyearunder audit, the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

xix. In our opinion and according to the information and explanations given to us, during the year under audit, the Company has not issued any secured debentures requiring creation of charge to the debenture holders.

xx. The Company has not raised any money by way of public issue during the year. Hence, clause (xx) of paragraph 4 of the Order is not applicable.

xxi. In our opinion and according to the information and explanations given to us and on our examination of books and records, no fraud on or by the Company has been noticed or reported during the year.

For M O S & ASSOCIATES

Chartered Accountants

Firm Registration No: 001975S

S.V.C.Reddy

Place: Hyderabad Partner

Date: 29th May 2014 Membership No: 224028

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Mar 31, 2013

Report on the Financial Statements

We have audited the accompanying financial statements of Gayatri Projects Limited ("the Company"), which comprise the Balance Sheet as at 3Ist March, 20I3 and the Statement of Profit and Loss and the Cash Flow Statement for the year then ended and a summary of significant accounting policies and other explanatory information.

Management''s Responsibility for the Financial Statements

The Company''s Management is responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the Accounting Standards referred to in sub-section (3C) of section 2II of the Companies Act, I956 ("the Act") and in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

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

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

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

Basis for Qualified Opinion

We invite attention of members to the matters detailed in Note No: 33 regarding non- provision of share of joint venture losses amounting to Rs.46.30 Crores (Previous Year Rs.53.78 Crores). Had the provision been made for these losses, the reserves and surplus and short term loans and advances of the Company would have been lower by Rs.46.30 Crores (Previous Year Rs.53.78 Crores). This was a subject matter of qualification in the auditors'' report for the year ended 31st March, 2012 also.

Qualified Opinion

In our opinion and to the best of our information and according to the explanations given to us, subject to the effects of the matter described in the Basis for Qualified Opinion paragraph, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) in the case of the Balance Sheet, of the state of affairs of the Company as at 3Ist March, 20I3;

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

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

Report on Other Legal and Regulatory Requirements

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

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

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

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

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

d) in our opinion, the Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement comply with the Accounting Standards referred to in sub-section (3C) of section 2II of the Act and

e) On the basis of written representations received from the directors as on 3Ist March, 20I3 taken on record by the Board of Directors, none of the directors is disqualified as on 3Ist March, 20I3 from being appointed as a director in terms of clause (g) of sub-section (I) of section 274 of the Act.

ANNEXURE TO INDEPENDENT AUDITORS'' REPORT

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

i. In respect of its Fixed Assets:

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

b. According to the information and explanations given to us, physical verification of the fixed assets was carried out by the management in a phased periodical manner during the year under report, which in our opinion is reasonable, having regard to the size of the Company and the nature of its assets. No major material discrepancies were noticed on such verification.

c. In our opinion, the Company has not disposed off substantial part of its fixed assets during the year under report and the going concern status of the Company is not affected.

ii. In respect of its inventories:

a. According to the information and explanations given to us, the inventories have been physically verified by management at reasonable intervals during the year. In our opinion, the frequency of such verification is reasonable.

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

c. The Company has maintained proper records of its inventories. As explained to us, there was no material discrepancies noticed on physical verification of inventories as compared to the book records.

iii. In respect of the Loans secured or unsecured, granted or taken by the company to/from companies, firms or other parties covered in the register maintained u/s 30I of the Companies Act, I956.

a. The Company has given unsecured loans to three parties covered in the register maintained under section 30I of the Companies Act, I956. At the year end the balance of loan granted to such parties was Rs. 460I.55Lakhs and the maximum balance outstanding during the year was Rs. 460I.55 Lakhs.

b. In our opinion and according to the information and explanations given to us, the terms and conditions of such loans given by the Company are not prima facie prejudicial to the interests of the Company.

c. The principal amount is repayable on demand and there is no repayment schedule and therefore there is no overdue amount.

d. The Company has not taken any loans secured or unsecured, from companies, firms, other parties listed in the register maintained under section 30I of the Companies Act, I956. Therefore the provisions of sub- clauses (f) and (g) of clause 4(iii) of the Order are not applicable to the Company.

iv. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the company and the nature of its business for the purchases of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in such internal control system. However, the internal controls over accounting of consumption, wastages, material reconciliation need further strengthening.

v. In respect of the Contracts or arrangements referred to in sec 30I of the Companies Act, I956;

a. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements, that need to be entered in the register maintained under section 30I of the Companies Act, I956 have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 30I of the Companies Act, I956 and exceeding the value of Rs. 5 lakhs in respect of each party during the year have been made at prices which are prima facie reasonable having regard to the prevailing market prices at the relevant time.

vi. According to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of sections 58A, 58AA or any other relevant provisions of the Act and the rules framed there under. Therefore the provisions of clause (vi) of paragraph 4 of the Order are not applicable to the Company.

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

viii. According to the information and explanation given to us, the Company is in the process of updating cost records in respect of its construction activities for which the maintenance of cost records have been prescribed u/s 209(I)(d) of the Companies Act, I956 pursuant to the Companies ( Cost Accounting Rules) Rules, 20II notified by the Central Government of India.

ix. In respect of Statutory dues:

a. According to the information and explanations given to us, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Investor education and protection fund, Sales Tax, Income Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty and Cess with the appropriate authorities during the year.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of aforesaid dues were outstanding as at 3Ist March, 20I3 pending for a period of more than six months from the date they became payable.

c. According to the information and explanation given to us, there are no dues of Sales tax, Income Tax, Wealth Tax, Service Tax, Customs Duty and Cess which have not been deposited as on 3Ist March, 20I3 on account of any dispute, except the following:

Sl. Name of the Statute Name of the Tax Forum where Dispute Amount Rs. No. Due is pending in Lakhs

1 Mines and Minerals (Development Department of Appeal Pending before 1,043.51 and Regulation) Act, 1957 Mines and Geology Supreme Court

2 Central Sales Tax Act, 1956 and Sales Tax/Vat Appeals pending before 2,313.90 Sales Tax Acts of Various States various states

3 Central Excise Act, 1944 Service Tax Appeals pending before 1,726.78 various states

4 Income Tax Act, 1961 Income Tax Appeal pending before 3,667.87 CIT(Appeals)

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

xi. Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to any financial institutions and banks as at the Balance Sheet date.

xii. In our opinion and according to the information and explanation given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities. Hence clause (xii) of paragraph 4 of the Order is not applicable.

xiii. In our opinion, the Company is not a chit fund or a nidhi, mutual benefit fund/society. Therefore clause (xiii) of paragraph 4 of the Order is not applicable to the Company.

xiv. In our opinion, the Company is not dealing or trading in shares, securities, debentures and other investments. Accordingly, the clause (xiv) of paragraph 4 of the Order is not applicable to the Company.

xv. In our opinion and according to the information and explanations given to us, the terms and conditions of the guarantees given by the Company for loans taken by others from Banks or Financial Institutions are not prima-facie prejudicial to the interests of the Company.

xvi. To the best of our knowledge and belief and according to the information and explanations given to us, in our opinion, term loans availed by the company were, prima facie, applied during the year for the purpose for which the loans were obtained.

xvii. According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company as at 3Ist March, 20I3, we report that no funds raised on short term basis have been used for long term investment.

xviii. The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 30I of the Companies Act, I956 during the year.

xix. The Company has not issued any debentures during the year and hence clause (xix) of paragraph 4 of the Order is not applicable.

xx. The Company has not raised any money by way of Public Issue during the year and hence clause (xx) of paragraph 4 of the Order is not applicable.

xxi. In our opinion and according to the information and explanations given to us and on our examination of books and records, no fraud on or by the Company has been noticed or reported during the year.

For C.B.MOULI & ASSOCIATES

Chartered Accountants

(Registration No: 002I40S)

MANI OOMMEN

Place : Hyderabad Partner

Date : 28th May, 20I3 Membership No: 24046

---

Mar 31, 2012

1. We have audited the attached Balance Sheet of GAYATRI PROJECTS LIMITED, as at 31st March, 2012, the Statement of Profit and Loss and the Cash Flow Statement for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditor's Report) Order, 2003 issued by the Central Government of India in terms of Sub-Section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that:

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

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

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

d) in our opinion, the Balance Sheet, the Statement of Profit and Loss and the Cash Flow Statement dealt with by this report are in compliance with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956;

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

f) in our opinion and to the best of our information and according to the explanations given to us, they said accounts read together with significant accounting policies and notes to financial statements Subject to Note No. 33 forming part of financial statements regarding non provision for the loss incurred by a Joint Venture give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

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

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

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



(Referred to in paragraph 3 of our report of even date)

i. In respect of its Fixed Assets :

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

b. According to the information and explanations given to us, physical verification of the fixed assets was carried out by the management in a phased periodical manner during the year under report, which in our opinion is reasonable, having regard to the size of the Company and the nature of its assets. No major material discrepancies were noticed on such verification.

c. In our opinion, the Company has not disposed off substantial part of its fixed assets during the year under report and the going concern status of the Company is not affected.

ii. In respect of its inventories:

a. According to the information and explanations given to us, the inventories have been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

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

c. The Company has maintained proper records of its inventories. As explained to us, there was no material discrepancies noticed on physical verification of inventories as compared to the book records.

iii. In respect of the Loans secured or unsecured, granted or taken by the company to/from companies, firms or other parties covered in the register maintained u/s 301 of the Companies Act, 1956.

a. The Company has given unsecured loan to a party covered in the register maintained under section 301 of the Companies Act, 1956. At the year end the balance of loan granted to such party was Rs.5773.10 Lakhs and the maximum balance outstanding during the year was Rs. 5773.10 Lakhs.

b. In our opinion and according to the information and explanations given to us, the terms and conditions of such loan given by the Company are not prima facie prejudicial to the interests of the Company.

c. The principal amount is repayable on demand and there is no repayment schedule and therefore there is no overdue amount.

d. The Company has not taken any loans secured or unsecured, from companies, firms, other parties listed in the register maintained under section 301 of the Companies Act, 1956. Therefore the provisions of sub-clauses (f) and (g) of clause 4(iii) of the Order are not applicable to the Company

iv. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the company and the nature of its business for the purchases of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in such internal control system.

v. In respect of the Contracts or arrangements referred to in sec 301 of the Companies Act, 1956;

a. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements, that need to be entered in the register maintained under section 301 of the companies Act, 1956 have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the companies Act, 1956 and exceeding the value of Rs. 5 lakhs in respect of each party during the year have been made at prices which are prima facie reasonable having regard to the prevailing market prices at the relevant time.

vi. According to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of sections 58A, 58AA or any other relevant provisions of the Act and the rules framed there under. Therefore the provisions of clause (vi) of paragraph 4 of the Order are not applicable to the Company.

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

viii. The Central Government has not prescribed maintenance of cost records under section 209(1)(d) of the Companies Act, 1956 for the Company. Hence clause (viii) of paragraph 4 of the Order is not applicable.

ix. In respect of Statutory dues:

a. According to the information and explanations given to us, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Investor education and protection fund, Sales Tax, Income Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty and Cess with the appropriate authorities during the year.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of aforesaid dues were outstanding as at 31st March, 2012 pending for a period of more than six months from the date they became payable.

c. According to the information and explanation given to us, there are no dues of Sales tax, Income Tax, Wealth Tax, Service Tax, Customs Duty and Cess which have not been deposited as on March 31, 2012 on account of any dispute, except the following :

Sl. Name of the Statute Name of the Due Forum where Dispute Amount Rs. in No. is pending Lakhs

1 Mines and Minerals (Development Department of Mines Appeal Pending from 1043.51 and Regulation) Act, 1957 and Geology Supreme Court

2 Central Sales Tax Act, 1956 and Sales Tax/Vat Appeal pending from 27.47 Sales Tax Acts of Various States various states

3 Central Excise Act, 1944 Service Tax Appeal pending from 476.14 various states

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

xi. Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to any financial institutions and banks as at the Balance sheet date.

xii. In our opinion and according to the information and explanation given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities. Hence clause (xii) of paragraph 4 of the Order is not applicable.

xiii. In our opinion, the Company is not a chit fund or a nidhi, mutual benefit fund/society. Therefore clause (xiii) of paragraph 4 of the Order is not applicable to the Company.

xiv. In our opinion, the Company is not dealing or trading in shares, securities, debentures and other investments. Accordingly, the clause (xiv) of paragraph 4 of the Order is not applicable to the Company.

xv. In our opinion and according to the information and explanations given to us, the terms and conditions of the guarantees given by the Company for loans taken by others from Banks or Financial Institutions are not prima-facie prejudicial to the interests of the Company.

xvi. To the best of our knowledge and belief and according to the information and explanations given to us, in our opinion, term loans availed by the company were, prima facie, applied during the year for the purpose for which the loans were obtained.

xvii. According to the information and explanations given to us and on an overall examination of the Balance Sheet of the Company as at March 31, 2012, we report that no funds raised on short term basis have been used for long term investment.

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

xix. The Company has not issued any debentures during the year and hence clause (xix) of paragraph 4 of the Order is not applicable.

xx. We have verified the end use of money raised by public issue from the draft prospectus filed with SEBI, the offer document and as disclosed in the notes to the financial statements.

xxi. In our opinion and according to the information and explanations given to us and on our examination of books and records, no fraud on or by the Company has been noticed or reported during the year.

For C.B.MOULI & ASSOCIATES

Chartered Accountants

Firm Registration No: 002140S

Place: Hyderabad MANI OOMMEN

Date : 30th May, 2012 Partner

Membership No: 24046

---

Mar 31, 2011

1. We have audited the attached Balance Sheet of GAYATRI PROJECTS LIMITED, as at 31st March, 2011, the Profit and Loss Account and the Cash Flow Statement for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditor's Report) Order, 2003 issued by the Central Government of India in terms of Sub-Section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that:

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

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

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

d) in our opinion, the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this report are in compliance with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956;

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

f) in our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with significant accounting policies and notes to accounts Subject to Note No.8(a) of II of Schedule 19 regarding non provision for the losses incurred by Joint Venture give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India :

i) in the case of the Balance Sheet, of the State of Affairs of the Company as at 31st March 2011;

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

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

ANNEXURE TO THE AUDITORS' REPORT OF M/s GAYATRI PROJECTS LIMITED FOR THE YEAR ENDED 31st MARCH, 2011.

(Referred to in paragraph 3 of our report of even date)

i. In respect of its Fixed Assets:

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

b. According to the information and explanations given to us, physical verification of the fixed assets was carried out by the management in a phased periodical manner during the year under report, which in our opinion is reasonable, having regard to the size of the Company and the nature of its assets. No major material discrepancies were noticed on such verification.

c. In our opinion, the Company has not disposed off substantial part of its fixed assets during the year under report and the going concern status of the Company is not affected.

ii. In respect of its inventories:

a. According to the information and explanations given to us, the inventories have been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

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

c. The Company has maintained proper records of its inventories. As explained to us, there were no material discrepancies noticed on physical verification of inventories as compared to the book records.

iii. In respect of the Loans Secured or Unsecured, granted or taken by the company to/from companies, firms or other parties covered in the register maintained u/s 301 of the Companies Act, 1956:

a. The Company has given unsecured loan to a party covered in the register maintained under section 301 of the Companies Act, 1956. At the year end the balance of loan granted to such party was Rs. 5773.10 Lacs and the maximum balance outstanding during the year was Rs. 5773.10 Lacs.

b. In our opinion and according to the information and explanations given to us, the terms and conditions of such loans given by the Company, are not prima facie prejudicial to the interests of the Company.

c. The principal amounts are repayable on demand and there is no repayment schedule and therefore there are no overdue amounts.

d. The Company has not taken any loans secured or unsecured, from companies, firms, other parties listed in the register maintained under section 301 of the Companies Act, 1956. Therefore the provisions of sub- clauses (f) and (g) of clause 4(iii) of the Order are not applicable to the Company

iv. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the company and the nature of its business for the purchases of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in such internal control system.

v. In respect of the Contracts or arrangements referred to in sec 301 of the Companies Act, 1956;

a. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements, that need to be entered in the register maintained under section 301 of the companies Act, 1956 have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the companies Act, 1956 and exceeding the value of Rs. 5 lacs in respect of each party during the year have been made at prices which are prima facie reasonable having regard to the prevailing market prices at the relevant time.

vi. According to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of sections 58A, 58AA or any other relevant provisions of the Act and the rules framed there under. Therefore the provisions of clause (vi) of paragraph 4 of the Order are not applicable to the Company.

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

viii. The Central Government has not prescribed maintenance of cost records under section 209(1)(d) of the Companies Act, 1956 for the Company. Hence clause (viii) of paragraph 4 of the Order is not applicable.

ix. In respect of Statutory dues:

a. According to the information and explanations given to us, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Investor education and protection fund, Sales Tax, Income Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty and Cess with the appropriate authorities during the year.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of aforesaid dues were outstanding as at 31st March, 2011 pending for a period of more than six months from the date they became payable.

c. According to the information and explanation given to us, there are no dues of Sales tax, Income Tax, Wealth Tax, Service Tax, Customs Duty and Cess which have not been deposited as on March 31, 2011 on account of any dispute, except the following:

Sl. Name of the Statute Name of the Due Forum where Dispute Amount No. is pending Rs. In Lacs

1 Mines and Minerals Department of Appeal Pending from 1043.51 (Development and Regulation) Mines and Geology Supreme Court Act, 1957

2 Central Sales Tax Act, 1956 and Sales Tax/Vat Appeal pending from Sales Tax Acts of Various States various states 27.47

3 Central Excise Act, 1944 Service Tax Appeal pending from 476.14 various states

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

xi. Based on our audit procedures and according to the information and explanations given to us, we are of the opinion that the Company has not defaulted in repayment of dues to any financial institutions and banks as at the Balance sheet date.

xii. In our opinion and according to the information and explanation given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities. Hence clause (xii) of paragraph 4 of the Order is not applicable.

xiii. In our opinion, the Company is not a chit fund or a nidhi, mutual benefit fund/society. Therefore clause (xiii) of paragraph 4 of the Order is not applicable to the Company.

xiv. In our opinion, the Company is not dealing or trading in shares, securities, debentures and other investments. Accordingly, the clause (xiv) of paragraph 4 of the Order is not applicable to the Company.

xv. In our opinion and according to the information and explanations given to us, the terms and conditions of the guarantees given by the Company for loans taken by others from Banks or Financial Institutions are not prima-facie prejudicial to the interests of the Company.

xvi. To the best of our knowledge and belief and according to the information and explanations given to us, in our opinion, term loans availed by the company were, prima facie, applied during the year for the purpose for which the loans were obtained.

xvii. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company as at March 31, 2011, we are of the opinion that short term funds have not been used for long term investment.

xviii. The Company has made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956 during the year. According to information and explanations given to us, we are of the opinion that the price at which shares have been issued is not prejudicial to the interests of the Company.

xix. According to the information and explanations given to us and examined by us, security has been created in respect of debentures issued during the year.

xx. The Company has not raised any money by way of public issue during the year and hence clause (xx) of paragraph 4 of the Order is not applicable.

xxi. In our opinion and according to the information and explanations given to us and on our examination of books and records, no fraud on or by the Company has been noticed or reported during the year.

For C.B.MOULI & ASSOCIATES

Chartered Accountants

Firm Registration No: 002140S

Place: Hyderabad MANI OOMMEN

Date : 22nd August, 2011 Partner

Membership No: 24046

---

Mar 31, 2010

1. We have audited the attached Balance Sheet of GAYATRI PROJECTS LIMITED, as at 31st March, 2010, the Profit and Loss Account and the Cash Flow Statement for the year ended on that date, annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

3. As required by the Companies (Auditors Report) Order, 2003 issued by the Central Government in terms of Sub- Section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that:

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

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

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

d) In our opinion, the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this report are in compliance with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956.

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

f) In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with significant accounting policies and notes to accounts in Schedule 18 Subject to Note No.8(a) and 8(b) of II of Schedule 18 regarding non provisions for the losses incurred by Joint Ventures give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India :

i) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March 2010; ii) In the case of the Profit and Loss Account, of the Profit for the year ended on that date; iii) In the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

ANNEXURE TO THE AUDITORS REPORT OF M/S GAYATRI PROJECTS LIMITED FOR THE YEAR ENDED 31st MARCH, 2010. (Referred to in paragraph 3 of our report of even date)

i.In respect of its Fixed Assets:

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

b. According to the information and explanations given to us, physical verification of the fixed assets was carried out by the management in a phased periodical manner during the year under report, which in our opinion is reasonable, having regard to the size of the Company and the nature of its assets. No major material discrepancies were noticed on such verification.

c. In our opinion, the Company has not disposed off substantial part of its fixed assets during the year under report and the going concern status of the Company is not affected.

ii. In respect of its inventories:

a. The inventories have been physically verified during the year by the management. In our opinion, the frequency of verification is reasonable.

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

c. The Company has maintained proper records of inventories. As explained to us, there was no material discrepancies noticed on physical verification of inventories as compared to the book records.

iii. In respect of the Loans secured or unsecured, granted or taken by the company to/from companies, firms or other parties covered in the register maintained u/s 301 of the Companies Act, 1956.

a. The Company has given unsecured interest - free loan aggregating to Rs.5773.10 Lacs to its Joint Venture. At the year end the loan granted to JV aggregates to Rs.5773.10 Lacs. The maximum balance outstanding during the year is Rs.5773.10 Lacs

b. In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions of loan given by the Company, are not prima facie prejudicial to the interests of the Company.

c. The Principal amounts are repayable on demand and there is no repayment Schedule.

d. In respect of the said loan the same is repayable on demand and therefore the question of overdue amount does not arise.

e. The Company has not taken any loans secured or unsecured, from companies, firms, other parties listed in the register maintained under section 301 of the Companies Act, 1956. Therefore the provisions of sub- clauses (f) and (g) of clause 4(iii) of CARO are not applicable to the Company.

iv. In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the company and the nature of its business for the purchases of inventory and fixed assets and for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in such internal control system.

v. In respect of the Contracts or arrangements referred to in sec 301 of the Companies Act, 1956;

a. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements, that need to be entered in the register maintained under section 301 of the companies Act, 1956 have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of contracts or arrangements entered in the register maintained under section 301 of the companies Act, 1956 and exceeding the value of Rs. 5 Lacs in respect of each party during the year have been made at prices which are prima facie reasonable having regard to the prevailing market prices at the relevant time.

vi. According to the information and explanations given to us, the Company has not accepted any deposits from the public within the meaning of sections 58A, 58AA or any other relevant provisions of the Act and the rules framed there under. Hence clause (vi) of paragraph 4 of the Order is not applicable to the Company.

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

viii. The Central Government has not prescribed maintenance of cost records under section 209(1)(d) of the Companies Act, 1956 for the company, hence clause (viii) of paragraph 4 of the Order is not applicable.

ix. In respect of Statutory dues:

a. According to the information and explanations given to us, the Company is regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Sales Tax, Income Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty and Cess with the appropriate authorities.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of aforesaid dues were outstanding as at 31st March, 2010 pending for a period of more than six months from the date they became payable.

c. According to the information and explanation given to us, there are no dues of Sales tax, Income Tax, Wealth Tax, Customs Duty and Cess which have not been deposited on account of any dispute, except the following:

Sl. Name of the Statute Name of the Due Forum where Dispute Amount

No. is pending Rs. In Lacs

1 Mines and Minerals (Development Department of Mines Appeal Pending from 1043.51 and Regulation) Act, 1957 and Geology Supreme Court

2 Central Sales Tax Act, 1956 and Sales Tax/Vat Appeal pending from 258.99 Sales Tax Acts of Various States various states

3 Central Excise Act, 1944 Service Tax Appeal pending from 227.92

various states

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

xi. Based on our audit procedures and according to the information and explanation given to us, we are of the opinion that the Company has not defaulted in repayment of dues to any financial institutions and banks as at the Balance sheet date.

xii. In our opinion and according to the information and explanation given to us, the Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities. Hence clause (xii) of paragraph 4 of the Order is not applicable.

xiii. In our opinion, the Company is not a chit fund or a nidhi, mutual benefit fund/society. Therefore clause (xiii) of paragraph 4 of the Order is not applicable to the Company.

xiv. As the Company is not dealing or trading in shares, securities, debentures and other investments, the clause (xiv) of paragraph 4 of the Order is not applicable to the Company.

xv. In our opinion and according to the information and explanations given to us, the terms and conditions of the guarantees given by the Company for loans taken by others from Banks or Financial Institutions are not prima-facie prejudicial to the interests of the Company.

xvi. To the best of our knowledge and belief and according to the information and explanations given to us, in our opinion, Term loans availed by the company were, prima facie, applied during the year for the purpose for which the loans were obtained other than temporary deployment pending application.

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

xviii. According to the information and explanation given to us, the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956.

xix. The Company has not issued any debentures during the year and hence clause (xix) of paragraph 4 of the Order is not applicable.

xx. The Company has not raised any money by way of public issue during the year and hence clause (xx) of paragraph 4 of the Order is not applicable.

xxi. In our opinion and according to the information and explanations given to us and, on our examination of books and records, no fraud on or by the Company has been noticed or reported during the year.

For C.B.MOULI & ASSOCIATES

Chartered Accountants

(Registration No: 002140S)

MANI OOMMEN Partner Membership No: 24046 Place : Hyderabad

Date : 28th May 2010.