Abha Power and Steel Ltd Auditor Reports

Examination report of Independent Auditor on the Restated Financial Statements of

To,

The Board of Directors

Abha Power and Steel Limited

(Formerly known as Abha Power and Steel Private Limited)

Silpahri Industrial State,

Bilaspur - 495001,

Chattisgarh, India

Dear Sir,

1. We have examined the attached Restated Financial Statements of ABHA POWER & STEEL LIMITED (Formerly known as ABHA POWER & STEEL PRIVATE LIMITED), ("Company") comprising the Restated Financial Statements of the Company constituting Restated Statement of Assets and Liabilities as at 31^st March 2024, 31^st March 2023, and 31^st March 2022, the Restated Statements of Profit and Loss, the Restated Cash Flow Statement for the year ended 31^st March 2024, 31^st March 2023, and 31^st March 2022. the Summary Statement of Significant Accounting Policies, the Notes and Annexures as forming part of these Restated Financial Statements (collectively, the "Restated financial statement"), as approved by the Board of Directors of the Company at their meeting held on June 28, 2024 for the purpose of inclusion in the Draft offer document/ offer document ("Draft offer document/ offer document") prepared by the Company in connection with its proposed SME Initial Public Offer of equity shares ("SME IPO") prepared in terms of the requirements of:

a) Section 26 of Part I of Chapter III of the Companies Act, 2013 (the "Act");

b) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018, as amended ("ICDR Regulations"); and

c) The Guidance Note on Reports in Company Prospectuses (Revised 2019) issued by the Institute of Chartered Accountants of India ("ICAI"), as amended from time to time (the "Guidance Note").

Managements Responsibility for the Restated Financial Statements

2. The Companys Board of Directors is responsible for the preparation of the Restated Financial Statements for the purpose of inclusion in the Draft offer document/ offer document

3. The Restated Financial Statements have been prepared by the management of the Company on the basis of preparation stated in Annexure 4 to the Restated Financial Statements. The Board of Directors of the Companys responsibility includes designing, implementing, and maintaining adequate internal control relevant to the preparation and presentation of the Restated Financial Statements. The Board of Directors is also responsible for identifying and ensuring that the Company complies with the Act, ICDR Regulations, and the Guidance Note.

Auditors Responsibilities

4. We have examined such Restated Financial Statements taking into consideration:

a. The terms of reference and terms of our engagement agreed with you in accordance with our engagement letter; requesting us to carry out the assignment, in connection with the proposed IPO of equity shares of the Company

b. The Guidance Note. The Guidance Note also requires that we comply with the ethical requirements of the Code of Ethics issued by the ICAI;

c. Concepts of test checks and materiality to obtain reasonable assurance based on verification of evidence supporting the Restated Financial Statements; and

d. The requirements of Section 26 of the Act and the ICDR Regulations.

Our work was performed solely to assist you in meeting your responsibilities in relation to your compliance with the Act, the ICDR Regulations, and the Guidance Note in connection with the proposed initial public offer of its equity shares of the Company.

5. The Restated Financial Statements have been compiled by the management of the Company from:

i. Audited Standalone Financial Statements of the company as at and for the period ended March 31, 2024 which were prepared in accordance with the Accounting Standards as prescribed under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014, as amended, and other accounting principles generally accepted in India ("Special Purpose interim audited Financial Statements");

ii. The Audited Financial Statements of the Company as at and for the Financial Year ended March 31, 2023 which were prepared in accordance with the Accounting Standards as prescribed under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014, as amended, and other accounting principles generally accepted in India ("Audited Financial Statements 2023");

iii. The Audited Financial Statements of the Company as at and for the Financial Year ended March 31, 2022 which were prepared in accordance with the Accounting Standards as prescribed under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014, as amended, and other accounting principles generally accepted in India ("Audited Financial Statements 2022");

The statutory audits for Financial Year ended on March 31, 2023 and March 31, 2022 were conducted by the Previous Statutory Auditor I.e. Taunk Khatri & Associates, Chartered Accountants ("Previous Auditor"). Accordingly, reliance has been placed on the financial information examined by him for the said years. The examination report included for these years is based solely on the report submitted by him and no audit has been carried out by us.

6. For the purpose of our examination, we have relied on:

a. the Auditors reports issued by us dated June 28, 2024 on Audited Financial Statements as at and for the period ended March 31, 2024 as referred in Paragraph 5 above;

b. the Auditors reports issued by Previous Auditor dated September 15, 2023 on Audited Financial Statements 2023 as at and for the year ended March 31, 2023 as referred in Paragraph 5 above;

c. the Auditors reports issued by Previous Auditor dated September 28, 2022 on Audited Financial Statements 2022 as at and for the year ended March 31, 2022 as referred in Paragraph 5 above;

7. Based on our examination and according to the information and explanations given to us, we report that the Restated financial information have been prepared:

a) have been prepared after incorporating adjustments for changes in accounting policies, material errors and rcgrouping/rcclassifications retrospectively in the period/financial years ended March 31, 2024, March 31, 2023 and March 31, 2022 to reflect the same accounting treatment as per the accounting policies and groupings/classifications as at and for the year ended March 31, 2024;

b) There are no qualifications in the auditors reports on the financial statements of as at and for the year ended March 31, 2024 and financial statements of as at and for the year ended 31st March 2023 and 31st March 2022, which require any adjustments to the Restated Financial Statements.

c) have been prepared in accordance with the Act, ICDR Regulations and the Guidance Note.

8. We have been subjected to the peer review process of the ICAI and hold a valid peer review certificate issued by the "Peer Review Board" of the ICAI.

9. The Restated Financial Statements do not reflect the effects of events that occurred subsequent to the respective dates of the reports on Audited Financial Statements mentioned in paragraph 7 above.

10. The report should not in any way be construed as a re-issuance or re-dating of any of the previous audit reports issued by us or Previous Auditor nor should this report be construed as a new opinion on any of the financial statements referred to therein.

11. We have no responsibility to update our report for events and circumstances occurring after the date of the report.

12. Our report is intended solely for use of the Board of Directors for inclusion in the Offer Documents to be filed with SEBI, Stock Exchange, and ROC in connection with the proposed IPO. Our report should not be used, referred to, or distributed for any other purpose except with our prior consent in writing. Accordingly, we do not accept or assume any liability or any duty of care for any other purpose or to any other person to whom this report is shown or into whose hands it may come without our prior consent in writing.