BLB Ltd

To the Members of BLB Limited

1. We have audited the attached Balance Sheet of BLB Limited as at 31st March,2010, the related Profit and Loss Account and also the Cash Flow Statement for the yearended on that date annexed thereto. These financial statements are the responsibility ofthe Company’s management. Our responsibility is to express an opinion on thesefinancial statements based on our audit.

2. We have conducted our audit in accordance with auditing standards generally acceptedin India. Those standards require that we plan and perform the audit to obtain reasonableassurance about whether the financial statements are free of material misstatement. Anaudit includes examining, on a test basis, evidence supporting the amounts and disclosuresin the financial statements. An audit also includes assessing the accounting principlesused and significant estimates made by management, as well as evaluating the overallfinancial statements presentation. We believe that our audit provides a reasonable basisfor our opinion.

3. As required by the Companies (Auditor’s Report) Order, 2003 issued by theCentral Government of India in terms of sub-section (4A) of section 227 of the CompaniesAct, 1956, we enclose in the Annexure a statement on the matters specified in paragraph 4and 5 of the said Order.

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

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

ii) in our opinion, proper books of account as required by law have been kept by theCompany so far as appears from our examination of those books;

iii) the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with bythis report are in agreement with the books of account;

iv) in our opinion the Balance Sheet, Profit & Loss Account and Cash Flow Statementdealt with by this report comply with the Accounting Standards referred to in sub-section(3C) of Section 211 of the Companies Act, 1956;

v) on the basis of written representations received from the Directors and taken onrecord by the Board of Directors, we report that none of the Directors of the Company isdisqualified as on 31st March, 2010, from being appointed as a Director under Clause (g)of Sub-Section (1) of Section 274 of the Companies Act, 1956; and

vi) in our opinion and to the best of our information and according to the explanationsgiven to us, the said accounts read together with the notes appearing thereon give theinformation required by the Companies Act, 1956, in the manner so required and give a trueand 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 31stMarch, 2010;

b) in the case of the Profit and Loss Account, of the Profit of the Company forthe year ended on that date; and

c) in the case of the Cash Flow Statement, of the Cash Flows for the year ended on thatdate.

(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 includingquantitative details and situation of fixed assets.

b) In our opinion, the fixed assets have been physically verified by the management atreasonable intervals, having regard to the size of the company and the nature of itsassets. No material discrepancies were noticed on such verification.

c) During the year the company has disposed off a substantial part of fixed assets.According to the information and explanations given to us, we are of the opinion that thesale of said part of fixed assets has not affected the going concern status of thecompany.

ii) In respect of its inventories:

a) The securities held as stock-in-trade have been verified by the management withdemat accounts maintained with depositories at reasonable intervals and the Units ofMutual Funds held as Stock-in-Trade in Demat accounts with the custodians are verifiedfrom the statements received from them on a regular basis.

b) As explained to us, the procedure of verification of the stocks followed by themanagement is reasonable and adequate in relation to the size of the Company and thenature of its business.

c) As explained and according to the records produced before us for our verification,no discrepancies were noticed on verification of stocks referred above, as compared tobook records.

iii) a) The Company has granted unsecured loans to three companies covered in theregister maintained under Section 301 of the Companies Act, 1956. The maximum amountinvolved during the year was of Rs. 726.00 lacs and the year-end balance of such loans wasRs.716.00 lacs.

b) In our opinion, the rate of interest and the other terms and conditions of suchloans are prima facie, not prejudicial to the interest of the Company.

c) In respect of the aforesaid loans, the parties are repaying the principal amounts asstipulated and are regular in payment of interest as stipulated.

d) In respect of the aforesaid loans, there is no overdue amount as the same arerepayable on demand.

e) The Company has taken unsecured loans from three other parties covered in theregister maintained under Section 301 of the Companies Act, 1956. The maximum amountinvolved during the year was Rs. 450.00 lacs and the year-end balance of such loans wasRs. 430.00 lacs.

f) In our opinion, the rate of interest and the other terms and conditions of suchloans are prima facie, not prejudicial to the interest of the Company.

g) In our opinion and according to the information and explanations given to us theCompany is regular in making the payment of the principal amount and interest asstipulated.

iv) In our opinion and according to the information and explanations given to us, thereis an adequate internal control system commensurate with the size of the company and thenature of its business for the purchase of inventory and fixed assets and for the sale ofgoods and services. During the course of our Audit, we have not observed any continuingfailure to correct major weaknesses in internal control system.

v) In respect of Contracts or arrangements referred to in section 301 of the CompaniesAct, 1956:

a) In our opinion and according to the information and explanations given to us, theparticulars of Contracts or arrangements referred to in section 301 of the Companies Act,1956 have been entered in the register which is required to be maintained under thatSection;

b) In our opinion and according to the information and explanations given to us, thetransactions made in pursuance of such contracts or arrangements have been made at priceswhich are reasonable having regard to prevailing market prices at the relevant time.

vi) The company has not accepted deposits from public in term of Section 58A of theCompanies Act, 1956 read with Clause 2(xii) of NBFC Acceptance of Public DepositsDirections, 1998 accordingly the provision of Clause 4(viii) of the Companies(Auditor’s Report) Order, 2003 is not applicable to the company.

vii) In our opinion, the company has an internal audit system commensurate with thesize and nature of its business.

viii) Looking to the nature of business carried by the Company, the provisions ofClause 4(viii) of the Companies (Auditor’s Report) Order, 2003 regarding maintenanceof cost records are not applicable to the Company.

ix) In respect of statutory dues:

a) The company is regular in depositing with appropriate authorities undisputedstatutory dues including Provident Fund, Employees’ State Insurance, InvestorEducation & Protection Fund, Income Tax, Work Contract Tax, Wealth Tax, Service Tax,Profession Tax and other material statutory dues applicable to it. Considering the natureof business carried on by the Company, there can be no dues pertaining to Custom Duty,Sales Tax and Cess.

b) According to the information and explanations given to us, no undisputed amountpayable in respect of Provident Fund, Employees’ State Insurance, Income Tax, WorkContract Tax, Wealth Tax, Service Tax, Profession Tax were in arrears as at 31/03/2010 fora period of more than six months from the date they became payable.

c) The particulars of dues of Income Tax as at March 31, 2010 which have not beendeposited on account of disputes are as follows:

x) The Company does not have accumulated losses as at 31st March, 2010. The company hasincurred cash losses only during the preceding financial year but has not incurred anycash loss during the current financial year.

xi) In our opinion and according to the information and explanations given to us, theCompany has not defaulted in repayment of dues to banks and financial institutions.However the Company has not issued any debentures during the year.

xii) In our opinion and according to the information and explanations given to us andbased on the information available, no loans and advances have been granted by the companyon the basis of security by way of pledge of shares, debentures and other securities.

xiii) In our opinion, the company is not a chit fund or a nidhi/mutual benefitfund/society and as such the provisions of clause 4(xiii) of the Companies (Auditor’sReport) Order, 2003 are not applicable to the Company.

xiv) In our opinion, the Company has maintained proper records of transactions andcontracts of dealing or trading in shares, securities and other investments and has madetimely entries therein. The aforesaid securities have been held by the Company in its ownname except to the extent of exemption granted under Section 49 of the Companies Act,1956.

xv) According to the information and explanations given to us, the company has notgiven any guarantee for loans taken by others from banks or financial institutions.

xvi) In our opinion and according to the information and explanations given to us, theterm loans have been applied for the purpose for which they were raised.

xvii) According to the information and explanations given to us and on an overallexamination of the balance sheet of the company, we report that no funds raised onshort-term basis, have been used for long-term investment by the company.

xviii) The Company has not made any preferential allotment of shares during the yearand as such the provisions of Clause 4(xviii) of the Companies (Auditor’s Report)Order, 2003 are not applicable to the Company.

xix) The Company did not issue any debentures during the year and as such theprovisions of Clause 4(xix) of the Companies (Auditor’s Report) Order, 2003 are notapplicable to the Company.

xx) The Company has not raised any money by way of public issue during the year and assuch the provisions of Clause 4(xx) of the Companies (Auditor’s Report) Order, 2003are not applicable to the Company.

xxi) In our opinion and according to the information and explanations given to us, wereport that no fraud on or by the company has been noticed or reported during the year.