Afcons Infrastructure Ltd Auditor Reports

To The Members of Afcons Infrastructure Limited

Report on the Audit of the Standalone Financial Statements OPINION

We have audited the accompanying standalone financial statements of Afcons Infrastructure Limited (the "Company"), which comprise the Balance Sheet as at 31st March 2025, and 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 ended on that date, and notes to the financial statements, including a summary of material accounting policies and other explanatory information in which are incorporated the Returns for the year ended on that date of the Companys 20 branches located at Mauritius, Mozambique, Gabon, Zambia, Mauritania, Ghana, Bhutan, Bangladesh, Liberia, Tanzania, Kuwait, Maldives, Indonesia, Qatar, Ivory Coast, Jordan, Oman, Abu Dhabi, Bahrain and Benin and which includes 16 joint operations accounted on proportionate basis.

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 joint operations referred to in the Other Matters section below, 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, ("Ind AS") and other accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March 2025, and its profit, total comprehensive income, its cash flows and the changes in equity 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 ("SA"s) specified under section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditors Responsibility 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 ("ICAI") together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules made thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements

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

EMPHASIS OF MATTER

1. We draw attention to Note no. 40 of the standalone financial statements, which describes the uncertainties relating to the outcome of the proceedings in arbitration and High Court in respect of variations recognised by the Company in terms of the provisions of the contract with the client, on account of matters stated therein.

Based on the Managements assessment and technical evaluation of the recoverability of the aforesaid claims, in terms of the provisions of the contract, which is supported by a legal opinion, as stated in the said Note 40, the management of the Company is of the view that the amounts recognised as amount due from customers under construction contracts, are considered as good and fully recoverable and no provision is considered necessary at this stage. However, considering that, the proceedings in arbitration and High Court are ongoing, the duration and outcome is uncertain.

2. Audit report on the Financial Statements of Transtonnelstroy Afcons Joint Venture (a joint operation included in the Standalone Financial Statements of the Company) includes an emphasis of matter as under:

"We draw attention to Note 32 to the Financial Statements, which describes the uncertainties relating to the outcome of the negotiation, proceedings in arbitration, High Court and Supreme Court in respect of variations recognised by the joint operation in earlier years in terms of the provisions of the contract with the client, on account of matters stated therein.

Based on the Managements assessment and technical evaluation of the recoverability of the aforesaid claims, in terms of the provisions of the contract, which is supported by legal opinion, the management is of the view that the amounts recognised as amount due from customers under construction contracts and trade receivable including interest on trade receivables as per arbitration award, are considered as good and fully recoverable and no provision is considered necessary at this stage. However, considering that the negotiation, proceedings in arbitration, High Court and Supreme Court are ongoing, the duration and outcome is uncertain.

Our opinion is not modified in respect of this matter."

Note 32 as described above is reproduced as Note 37 to the Standalone Financial Statements.

3. Audit report on the Financial Statements of Afcons Gunanusa Joint Venture (a joint operation included in the Standalone Financial Statements of the Company) includes an emphasis of matter as under:

"We draw attention to Note 26 to the Financial Statements, which describes the uncertainties relating to the outcome of the arbitration proceedings in respect of claims recognized by the joint operation in earlier years, on account of change orders.

Based on the Managements estimates and technical evaluation of the recoverability in terms of the provisions of the contract, which is supported by legal opinion, the management is of the view that the amounts recognized as amount due from customers under construction contract are considered as good and fully recoverable and no provision is considered necessary at this stage. However, considering that the arbitration proceedings are ongoing, the duration and outcome is uncertain.

Our opinion is not modified in respect of this matter."

Note 26 as described above is reproduced as Note 36 to the Standalone Financial Statements.

4. Audit report on the Financial Statements of Dahej Standby Jetty Project Undertaking (a joint operation included in the Standalone Financial Statements of the Company) includes an emphasis of matter as under:

"We draw attention to Note no. 23 to the Financial Statement, which describes the uncertainties relating to the outcome of the Honble High Court Delhi, proceedings, where the joint operation has filed appeal to set aside an unfavourable award granted in Arbitration, towards claims of liquidated damages for delay in completion of works by joint operation.

Based on the Managements assessment and technical evaluation of the recoverability of the aforesaid client claims which are already encashed and claims filed by the joint operation against the client, in terms of the provisions of the contract, which is supported by a legal opinion, as stated in the said Note 23, the management is of the view that the amounts recognised as amount due from customers under construction contracts and other receivable, are considered as good and fully recoverable and no provision is considered necessary at this stage. However, considering that the proceedings in High Court are ongoing, the duration and outcome is uncertain.

Our opinion is not modified in respect of this matter."

Note 23 as described above is reproduced as Note 38 to the Standalone Financial Statements.

Our opinion is not modified in respect of the above matters. ^

KEY AUDIT MATTERS

Key audit matters are those matters that, in our professional S judgment, were of most significance in our audit of the standalone financial statements of the current period.

These matters were addressed in the context of our audit of the standalone financial statements as a whole, and oi 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 the key audit matters to be communicated in our report.

Key Audit Matter	Auditors Response
Estimation of contract cost and revenue recognition - Construction Contract Revenue	Our audit procedures related to the (1) identification of distinct performance obligations, (2) evaluation of the process for estimation of costs to complete (3) evaluation of implications of change orders on costs estimates of costs to complete and revenue and (4) evaluation of any variable consideration, included the following amongst others:
There are significant accounting judgements in estimating revenue to be recognised on contracts with customers, including estimation of costs to complete. The Company recognises revenue on the basis of stage of completion in proportion of the contract costs incurred at balance sheet date, relative to the total estimated costs of the contract at completion. The recognition of revenue is therefore dependent on estimates in relation to total estimated costs of each such contract.	• We tested the effectiveness of controls relating to the (a) evaluation of performance obligations and identification of those that are distinct; (b) estimation of costs to complete each of the performance obligations including the contingencies in respect thereof, as work progresses and the impact thereon as a consequence of change orders; (c) the impact of change orders on the transaction price of the related contracts; and (d) evaluation of the impact of variable consideration on the transaction price.
Significant judgements are involved in determining the expected losses, when such losses become probable based on the expected total contract cost. Cost contingencies are included in these estimates to take into account specific risks of uncertainties or disputed claims against the Company, arising within each contract. These contingencies are reviewed by the Management on a regular basis throughout the life of the contract and adjusted where appropriate. The revenue on contracts may also include variable consideration (variations and claims). The estimates of variable consideration are based largely on an assessment of anticipated performance and all information (historical, current and forecasted) that is reasonably available.	• Assessed the appropriateness of the revenue recognition accounting policies in line with Ind AS 115 "Revenue from Contracts with Customers".
	• We selected sample of contracts with customer and performed the following procedures:
Refer to Note No. 1.B.3 and 22 to the Standalone Financial Statements	a. Obtained the percentage of completion calculations, agreed key contractual terms with the signed contracts, tested the mathematical accuracy of the cost to complete calculations and re-performed the calculation of revenue recognized during the year based on the percentage of completion.
	b. For costs incurred to date, we verified relevant supporting documents and performed cut off procedures.
	c. Variable consideration (variation/claims) is recognized by the management when its recovery is assessed to be highly probable. We have evaluated the managements assessment by reviewing the contractual terms and customer communications.
	d. Evaluated the reasonableness of key assumptions included in estimated total contract costs:
	- Tested the forecast cost to complete, obtained the breakdown of forecasted costs and tested the elements of the forecast by obtaining executed purchase orders and agreements.
	- Evaluated reasonableness of managements judgements and assumptions by using past trends and comparing the movement in estimated total contracts costs from previous periods.
	• Assessed the adequacy of presentation and related disclosures in the standalone financial statements.

 

Recoverability of Non-Current Contract Assets and non-current trade receivables	Our audit procedures related to the (1) evaluation of evidence supporting the execution of work; (2) evaluation of recoverability of the amounts including the impact on the expected credit loss allowance; and (3) assessment of adjusting events after the reporting date i.e. 31st March, 2025 and the date when the financial statements are approved by the Companys Board of Directors included the following amongst others:
The Company, in its contract with customers, promises to transfer distinct services to its customers mainly services rendered in the form of engineering, procurement, and construction ("EPC") services through design-build contracts. At each reporting date, revenue is accrued for costs	• We have evaluated the design and tested the operatir effectiveness of relevant internal financial controls ov the (a) gathering and evaluation of evidence supports the execution of work (b) evaluation of recoverability the non-current trade receivables and certification non-current contract assets including the impact o the expected credit loss allowance; and (c) assessme of adjusting events after the reporting date i.e. 31 March, 2025 and the date when the financial statemen are approved by the Board of Directors and the impa thereof on the carrying amount of the related contra assets and trade receivables.
incurred against work performed that may not have been invoiced. Identifying whether the Companys performance has resulted in a service that would be billable and collectable where the works carried out have not been acknowledged by customers as of the reporting date involves significant judgement. These non-current contract assets and trade receivables might be on account of dispute which might have arisen on account of delay or additional costs incurred which the customer is contractually liable for or variations requested by the customer. Assessing the recoverability of contract assets and amounts overdue against invoices raised which have remained unsettled for a significantly long period after the end of the contractual credit period also involves a significant amount of judgment.	• We selected sample of contract assets wit corresponding trade receivables and performed th following procedures:
Refer to Note No. 1.B.3, 5 and 8 to the Standalone Financial Statements	- We verified the contractual terms and collectic history
	- We verified evidence supporting the execution work for which the contract assets were recognize
	- We inquired for reasons for the delays in recovery invoices and the basis on which recoverability of th contract assets was assessed.
	- We have also assessed the impact on the allowanc for expected credit losses
	- We assessed for the adjusting events after th reporting date i.e. 31st March, 2025 and the dat when the financial statements are approved by th Board of Directors and the impact thereof on th carrying amount of the related contract assets.
	• Assessed and challenged the information used by th Management to determine the expected credit losse by considering credit risk of the customer, contractu terms, project status, past history, subseque realization, correspondence between the Compan and their customers, ongoing litigations and dispute if any, existing market conditions and forward-look^ estimates, with the customer.

INFORMATION OTHER THAN THE FINANCIAL STATEMENTS AND AUDITORS REPORT THEREON

• The Companys Board of Directors is responsible for the other information. The other information comprises the Management Discussion and Analysis, Boards Report including Annexures to Boards Report, but does not include the consolidated financial statements, standalone financial statements and our auditors 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, compare with the financial statements of the joint operations audited by the other auditors, to the extent it relates to these joint operations and, in doing so, place reliance on the work of the other auditors and, consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated. Other information so far as it relates to the joint operations, is traced from their financial statements audited by the other auditors

• 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 BOARD OF DIRECTORS FOR THE STANDALONE FINANCIAL STATEMENTS

The respective Board of Directors of the Company and its joint operation company is responsible for the matters stated in section 134(5) of 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 including other comprehensive income, cash flows and changes in equity of the Company including its joint operation company in accordance with the accounting principles generally accepted in India, including Ind AS specified under section 133 of the Act. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding 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 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 Companys 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 intend to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Companys Board of Directors are also responsible for overseeing the Companys financial reporting process.

AUDITORS RESPONSIBILITY 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 auditors report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an 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 financial controls relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls with reference to standalone financial statements 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 the management.

• Conclude on the appropriateness of managements 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 Companys ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors 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 auditors 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.

• Obtain sufficient appropriate audit evidence regarding the financial information of the Company and its joint operations to express an opinion on the standalone financial statements. We are responsible for the direction, supervision and performance of the audit of the financial statements of such entities or business activities included in the standalone financial statements of which we are the independent auditors. For the other entities or business activities included in the standalone financial statements, which have been audited by the other auditors, such other auditors remain responsible for the direction, supervision and performance of the audits carried out by them. We remain solely responsible for our audit opinion.

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 financial controls 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 auditors 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.

OTHER MATTERS

We did not jointly audit the financial statements of 16 joint operations included in the standalone financial statements of the Company whose financial statements reflect total assets of Rs. 2,400.94 crore as at 31st March 2025 and total revenue of Rs. 869.58 crore for the year ended on that date, as considered in the standalone financial statements. The financial statements of these joint operations have been audited by either of us in our individual capacity or jointly with other auditors or other auditors whose reports have been furnished to us, and our opinion in so far as it relates to the amounts and disclosures included in respect of these joint operations and our report in terms of sub-section (3) of section 143 of the Act, in so far as it relates to the aforesaid joint operations, is based solely on the report issued by either of us in our individual capacity or jointly with other auditors and other auditors.

Our opinion on the standalone financial statements and our report on Other Legal and Regulatory Requirements below is not modified in respect of these matters.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

1. As required by section 143(3) of the Act, based on our audit and on the consideration of the reports of the other auditors on the separate financial statements of the joint operations, referred to in the Other Matters section above 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.

b) In our opinion, proper books of account as required by law have been kept by the Company and its joint operation which is a company incorporated in India so far as it appears from our examination of those books and the reports of the other auditors.

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

d) In our opinion, the aforesaid standalone financial statements comply with the Ind AS specified under section 133 of the Act.

e) On the basis of the written representations received from the directors as on 31st March 2025 taken on record by the Board of Directors of the Company and the report of the statutory auditors of its joint operation which is a company incorporated in India, none of the directors is disqualified as on 31st 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 with reference to standalone financial statements of the Company and the operating effectiveness of such controls, refer to our separate Report in "Annexure A" which is based on the auditors reports of the Company and its joint operation which is a company incorporated in India. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Companys internal financial controls with reference to standalone financial statements of those companies.

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 remuneration paid by the Company to its directors during the year is in accordance with the provisions of section 197 of the Act.

Further, in our opinion and to the best of our information and according to the explanations given to us and based on the auditors reports of a joint operation which is a company incorporated in India, the said joint operation company being a private company, section 197 of the Act related to the managerial remuneration is not applicable.

h) 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 information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements - Refer Note 30, 36, 37, 38, 40, 41,42 and 43 to the standalone financial statements;

ii. The Company has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts - Refer Note 18 to the standalone financial statements; Further the Company did not have any material foreseeable losses. on derivative contracts.

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

There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the joint operation company incorporated in India.

iv. (a) The respective Management of the

Company and of its joint operation which is a company incorporated in India, whose financial statements have been audited under the Act, has represented to us and to the other auditors of such jointly controlled operation respectively, that, to the best of its knowledge and belief, as disclosed in the note 48(x) to the financial statements 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 or such joint operation 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, 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 respective Management of the Company and one of its joint operation which is a company incorporated in India, whose financial statements have been audited under the Act, has represented to us and to the other auditors of such jointly controlled operation respectively that, to the best of its knowledge and belief, as disclosed in the note 48 (x) to the financial statements, no funds have been received by the Company or such joint operation from any person(s) or entity(ies), including foreign entities ("Funding Parties"), with the understanding, whether recorded in writing or otherwise, that the Company or such joint operation company shall, 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.

(c) Based on the audit procedures performed that have been considered reasonable and appropriate in the circumstances performed by us and that performed by the auditors of the joint operation which is a company incorporated in India whose financial statements have been audited under the Act, nothing has come to our or other auditors notice that has caused us or the other auditors to believe that the representations under sub-clause (i) and (ii) of Rule 11(e), as provided under

(a) and (b) above, contain any material misstatement.

v. The preference and equity dividend of the previous year, declared and paid by the Company during the year is in accordance with section 123 of the Act, as applicable.

As stated in note 12.11 to the standalone financial statements, the Board of Directors of the Company have proposed dividend on equity shares for the year 2024-25 which is subject to the approval of the members of the Company at the ensuing Annual General Meeting. Such dividend proposed is in accordance with section 123 of the Act, as applicable.

The joint operation which is a company incorporated in India, whose financial statements have been audited under the Act, has not declared or paid any dividend during the year and has not proposed final dividend for the year.

vi. Based on our examination, which included test checks, the Company and its joint operation which is company incorporated in India has used accounting software systems for maintaining its books of account for the financial year ended 31st March, 2025 which have the feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software systems. Further, during the course of our audit we did not come across any instance of the audit trail feature being tampered with and the audit trail has been preserved by the Company as per the statutory requirements for record retention.

2. As required by the Companies (Auditors Report) Order, 2020 ("the Order") issued by the Central Government in terms of Section 1 43(1 1 ) of the Act, we give in "Annexure B" a statement on the matters specified in paragraphs 3 and 4 of the Order.

Annexure "A" to the Independent Auditors Report

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

REPORT ON THE INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO STANDALONE FINANCIAL STATEMENTS UNDER CLAUSE (I) OF SUB-SECTION 3 OF SECTION 143 OF THE COMPANIES ACT, 2013 (THE "ACT")

We have audited the internal financial controls with reference to standalone financial statements of Afcons Infrastructure Limited (the "Company") as at 31st March 2025 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date which includes internal financial controls with reference to standalone financial statements of the Companys and a joint operation which is company incorporated in India.

MANAGEMENTS AND BOARD OF DIRECTORS RESPONSIBILITIES FOR INTERNAL FINANCIAL CONTROLS

The respective Management and Board of Directors of the Company and its joint operation which is company incorporated in India are responsible for establishing and maintaining internal financial controls with reference to standalone financial statements based on the internal control with reference to standalone financial statements 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. 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 respective companys 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 Companys internal financial controls with reference to standalone financial statements of the Company and its joint operation company incorporated in India 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") issued by the Institute of Chartered Accountants of India and the Standards on Auditing prescribed under Section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls with reference to standalone financial statements. 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 with reference to standalone financial statements 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 with reference to standalone financial statements and their operating effectiveness. Our audit of internal financial controls with reference to standalone financial statements included obtaining an understanding of internal financial controls with reference to standalone financial statements, 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 judgement, 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 and the audit evidence obtained by the other auditors of the joint operation which is a company incorporated in India, 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 Companys internal financial controls with reference to standalone financial statements.

MEANING OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO STANDALONE FINANCIAL STATEMENTS

A companys internal financial control with reference to standalone financial statements 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 companys internal financial control with reference to standalone financial statements 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 authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely

detection of unauthorised acquisition, use, or disposition of the companys assets that could have a material effect on the financial statements.

INHERENT LIMITATIONS OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO STANDALONE FINANCIAL STATEMENTS

Because of the inherent limitations of internal financial controls with reference to standalone financial statements, 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 with reference to standalone financial statements to future periods are subject to the risk that the internal financial control with reference to standalone financial statements 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, to the best of our information and according to the explanations given to us and based on the consideration of the reports of the other auditors on internal financial controls with reference to standalone financial statements of the joint operations referred to in the Other Matters paragraph below, the Company has, in all material respects, an adequate internal financial controls with reference to standalone financial statements and such internal financial controls with reference to standalone financial statements were operating effectively as at 31st March 2025, based on the criteria for internal financial control with reference to standalone financial statements established by the respective 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.

OTHER MATTERS

Our aforesaid report under Section 143(3)(i) of the Act on the adequacy and operating effectiveness of the internal financial controls with reference to standalone financial statements insofar as it relates to a joint operations which is a company incorporated in India, is based on the corresponding reports of the other auditors of such companies incorporated in India.

Our opinion is not modified in respect of this matter.

Annexure "B" to the Independent Auditors Report

(Referred to in paragraph 2 under ‘Report on Other Legal and Regulatory Requirements section of our report to the members of Afcons Infrastructure Limited of even date)

In terms of the information and explanations sought by us and given by the Company and the books of account and records examined by us in the normal course of audit and to the best of our knowledge and belief, we state that,

(i) (a) (A) The Company has maintained proper records showing full particulars, including quantitative details and situation of Property, Plant and Equipment.

(B) The Company has maintained proper records showing full particulars of intangible assets.

(b) The Company has a program of verification of property, plant and equipment, so to cover all the items once every three years, which in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, certain Property, Plant and Equipment were due for verification during the year and were physically verified by the Management during the year. According to the information and explanations given to us, no material discrepancies were noticed on such verification.

(c) Based on the examination of the registered sale deed / transfer deed / conveyance deed provided to us, we report that, the title deeds of the immovable properties of land and buildings (other than properties where the Company is the lessee and the lease agreements are duly executed in favour of the Company) disclosed in the financial statements included in Property, Plant and Equipment, are held in the name of the Company as at the balance sheet date. Immovable properties of land and buildings whose title deeds have been pledged as security for loans and guarantees, are held in the name of the Company based on the confirmations directly received by us from custodians.

(d) The Company has not revalued any of its property, plant and equipment (including Right of Use assets) and intangible assets during the year.

(e) No proceedings have been initiated during the year or are pending against the Company as at

31^st March 2025 for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (as amended in 2016) and rules made thereunder.

(ii) (a) The inventories including stock held with third parties except for goods-in-transit, were physically verified during the year by the Management at reasonable intervals. In our opinion and based on information and explanations given to us, the coverage and procedure of such verification by the Management is appropriate having regard to the size of the Company and the nature of its operations. In respect of goods in- transit, the goods have been received subsequent to the year end. No discrepancies of 10% or more in the aggregate for each class of inventories were noticed on such physical verification of inventories/alternate procedures performed as applicable, when compared with the books of account.

(b) According to the information and explanations given to us, the Company has been sanctioned working capital limits in excess of Rs. 5 Crore, in aggregate, at points of time during the year, from banks or financial institutions on the basis of security of current assets. In our opinion and according to the information and explanations given to us, the quarterly returns or statements comprising (stock statements, book debt statements, and other stipulated financial information) filed by the Company with such banks or financial institutions are in agreement with the unaudited books of account of the Company of the respective quarters. Till the date of this report, the returns/statements for the quarter ended March 31, 2025, are not due for submission with the banks.

(iii) The Company has made investment in, provided guarantee or security and granted loans or advances in the nature of loans, secured or unsecured, to companies, firms, Limited Liability Partnerships or any other parties during the year, in respect of which:

(a) The Company has provided loans or advances in the nature of loans and stood guarantee during the year and details of which are given below. The Company has not provided security to any other entity during the year.

(Rs. in Crore)
	Loans or Advances in nature of loans	Guarantees
A. Aggregate amount granted / provided during the year:
- Subsidiaries	22.96	-
- Joint Operations*	203.05	97.36
B. Balance outstanding as at balance sheet date in respect of above cases:
- Subsidiaries	20.02	-
- Joint Operations*	93.55	81.09

* The aforesaid balances are not reflected in the financial statements as these are eliminated while preparing the Standalone financial statements of the company as per accounting policy described in Note 1.B.2.a to the financial statements. Hence loan or advances in nature of loan is not considered for the reporting under this clause.

(b) The investment made, guarantees provided and the terms and conditions of the grant of all the above-mentioned loans and advances in the nature of loans and guarantees provided, during the year are, in our opinion, prima facie, not prejudicial to the Companys interest.

(c) In respect of loans granted or advances in the nature of loans provided by the Company, the schedule of repayment of principal and payment of interest has not been stipulated and in the absence of such schedule, we are unable to comment on the regularity of the repayments of principal amounts and payment of interest.

(d) In respect of the loans granted or advances in nature of loans, the schedule of repayment of principal and payment of interest has not been stipulated and in the absence of such schedule, we are unable to comment on the overdue amount remaining outstanding as at balance sheet date.

(e) In respect of the loans/advances in nature of loans, the schedule of repayment of principal and payment of interest has not been stipulated and in the absence of such schedule, we are unable to comment on whether the loans granted or advances in nature of loans fell due during the year and were renewed or extended.

(f) The Company has granted Loans or advances in the nature of loans which are without specifying any terms or period of repayment details of which are given below:

(Rs. in Crore)

	All Parties*	Promoters	Related Parties
Aggregate of loans/advances in nature of loans
- Repayable on demand (A)	-	-	-
- Agreement does not specify any terms or period of repayment (B)	226.01	-	226.01
Total (A+B)	226.01	-	226.01
Percentage of loans/advances in nature of loans to the total loans	100%	-	100%

* The loan or advances in nature of loan granted to Jointly controlled operations amounting to Rs. 203.05 Crore is eliminated while preparing the standalone financial statements as per the accounting policy Note 1.B.2.a.

(iv) According to information and explanation given to us, the Company has not granted any loans, made investments or provided guarantees or securities that are covered under the provisions of sections 185 or 186 of the Companies Act, 2013, and hence reporting under clause 3(iv) of the Order is not applicable. Attention is invited to note 39 of the standalone financial statements regarding reliance placed on the legal opinion obtained by the management in the matter of nonapplicability of section 186 of the Companies Act 2013 in relation to loan made, guarantee given or security provided as the company is in the business of constructing and delivering infrastructure facilities.

(v) The Company has not accepted any deposit or amounts which are deemed to be deposits. Hence, reporting under clause (v) of the Order is not applicable.

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

(vii) According to the information and explanations given to us, in respect of statutory dues:

(a) Undisputed statutory dues, including Goods and Service Tax, Provident Fund, Employees State Insurance, Income- tax, Sales Tax, duty of Custom, duty of Excise, Value Added Tax, cess and other material statutory dues applicable to the Company have generally been regularly deposited by it with the appropriate authorities, though there has been a delay in few cases in respect of remittance of Provident Fund and Profession Tax.

Also, refer note 30 to the standalone financial statements regarding managements assessment on certain matters relating to provident fund.

There were no undisputed amounts payable in respect of Goods and Service Tax, Provident Fund, Employees State Insurance, Income-tax, Sales Tax, duty of Custom, duty of Excise, Value Added Tax, cess and other material statutory dues in arrears as at 31^st March 2025 for a period of more than six months from the date they became payable except the following:

Name of statute	Nature of dues	Amount (Rs. in Crore)	Period to which amount relates	Due date	Date of subsequent payment
The Employee Provident funds and Miscellaneous Provisions Act, 1952	Employer contribution to pension scheme	0.01	AY 2024-25	Various	Not yet paid

(b) Details of statutory dues referred to in sub-clause (a) above which have not been deposited as on 31^st March 2025 on account of disputes are given below:

Name of Statute	Nature of Dues	Forum Where the Dispute is Pending	Period to Which the Amount Relates	Total Amount (Rs. in Crores)	Unpaid Amount (Rs. in Crores)*
The Income Tax Act, 1961	Income Tax	Commissioner of Income Tax (Appeals)	AY 2022-23	0.22	Appeal Pending
The Income Tax Act, 1961	Income Tax	Commissioner of Income Tax (Appeals)	AY 2021-22	7.59	Appeal Pending
The Finance Act, 1994	Service Tax	Appellate Authority Tribunal	AY 2008 to 2019	69.63	66.95
Local Sales Tax Acts applicable in respective States (Andhra Pradesh, Tamil Nadu and Madhya Pradesh)	Sales Tax	Appellate Authority up to Commissioner level	AY 1986 to 1991 and AY 1993 to 2000	0.42	0.41
Local Sales Tax Acts applicable in respective States (West Bengal)	Sales Tax	Appellate Authority - Tribunal Level	AY 1988 to 1990 and AY 1998 to 1999	0.17	0.17
Local Sales Tax Acts applicable in respective States(Orissa)	Sales Tax	Appeal before Commissioner	AY 2005-06	0.44	0.15
Local Sales Tax Acts applicable in respective States (Orissa)	Sales Tax	At High Court	AY 2000-01	1.36	0.31
Goods and Services Tax Act, 2017	Goods and Services tax	Additional Commissioner, Lucknow	AY 2020-21	6.20	3.58
Goods & Services Tax, 2017	Goods and Services tax	Asst Commissioner, State Tax, Mumbai	AY 2020 & 2021	2.65	2.52
Goods & Services Tax, 2017	Goods and Services tax	Joint Commissioner, State Tax, Lucknow	AY 2021 to 2023	0.35	0.35
Goods & Services Tax, 2017	Goods and Services tax	Joint Commissioner, Thane	AY 2018	85.46	42.1
Central Sales Tax, 1956	Central Sales Tax	Commissioner, Commercial Tax	AY 2013	0.58	0.46
Goods & Services Tax, 2017	Goods and Services tax	Joint Commissioner Appeal, Howrah	AY 2019	1.72	1.72
Goods & Services Tax, 2017	Goods and Services tax	Joint Commissioner, Thane	AY 2018	1.26	1.26
Goods & Services Tax, 2017	Goods and Services tax	Appellate Commissioner, Chennai	AY 2020	13.22	13.22
Value Added Tax	VAT	Sales Tax Tribunal	2009-13	7.33	7.33

*Amount unpaid is net of the amounts paid under protest.

(viii) There were no transactions relating to previously unrecorded income that were surrendered or disclosed as income in the tax assessments under the Income Tax Act, 1961 (43 of 1961) during the year.

(ix) (a) In our opinion, the Company has not defaulted in the repayment of loans or other borrowings or in the payment of interest thereon to any lender during the year.

Loan or advances in nature of loan received from Jointly controlled operations are eliminated while preparing the standalone financial statement as per the accounting policy 1.B.2.a Hence, the same is not considered for the reporting under this clause.

(b) The Company has not been declared wilful defaulter by any bank or financial institution or government or any government authority.

(c) To the best of our knowledge and belief, in our opinion, term loans availed by the Company were, applied by the Company during the year for the purposes for which the loans were obtained.

(d) On an overall examination of the financial

statements of the Company, funds raised on short-term basis have, prima facie, not been used during the year for long-term purposes by the Company.

(e) On an overall examination of the financial

statements of the Company, the Company has not taken any funds from any entity or person on account of or to meet the obligations of its joint operations or its subsidiaries.

(f) The Company has not raised loans during the year on the pledge of securities held in its joint operations or subsidiaries.

(x) (a) In our opinion, moneys raised by way of initial

public offering (IPO) during the year have been applied by the Company during the year for the purposes for which they were raised, other than temporary deployment pending application of proceeds.

(b) During the year the Company has not made any preferential allotment or private placement of shares or convertible debentures (fully or partly or optionally) and hence reporting under clause (x)(b) of the Order is not applicable to the Company.

(xi) (a) To the best of our knowledge, no fraud by the

Company and no material fraud on the Company has been noticed or reported during the year.

(b) To the best of our knowledge, no report under subsection (12) of section 143 of the Companies Act has been filed in Form ADT-4 as prescribed under rule 13 of Companies (Audit and Auditors) Rules, 2014 with the Central Government, during the year and upto the date of this report.

(c) We have taken into consideration the whistle blower complaints received by the Company during the year when performing our audit.

(xii) The Company is not a Nidhi Company and hence reporting under clause (xii) of the Order is not applicable.

(xiii) In our opinion, the Company is in compliance with Section 177 and 188 of the Companies Act, where applicable, for all transactions with the related parties and the details of related party transactions have been disclosed in the financial statements as required by the applicable accounting standards.

(xiv) (a) In our opinion the Company has an adequate

internal audit system commensurate with the size and the nature of its business.

(b) We have considered, the internal audit reports for the year under audit, issued to the Company during the year.

(xv) In our opinion during the year the Company has not entered into any non-cash transactions with any of its directors or directors of its holding company, subsidiary companies or persons connected with such directors and hence provisions of section 192 of the Companies Act, 2013 are not applicable to the Company.

(xvi) (a) The Company is not required to be registered

under section 45-IA of the Reserve Bank of India Act, 1934. Hence, reporting under clause (xvi)(a), (b) and (c) of the Order is not applicable.

(b) Based on the information and explanations provided by the management of the Company, the Group has more than one CIC as part of the group. There are seven CICs forming part of the group.

(xvii) The Company has not incurred cash losses during the financial year covered by our audit and the immediately preceding financial year.

Following matters have been reported by the auditors of Afcons Sener LNG Construction Projects Private Limited (joint operation company) under the report on the matters specified in paragraphs 3 and 4 of the companies (Auditors report) order, 2020 (CARO) on the financial statements of that joint operation company which have been reproduced under this clause by us as under:

"The Company has incurred cash losses during the financial year covered by our audit and the immediately preceding financial year."

(xviii) There has been no resignation of the statutory auditors of the Company during the year.

(xix) On the basis of the financial ratios, ageing and expected dates of realization of financial assets and payment of financial liabilities, other information accompanying the financial statements and our knowledge of the Board of Directors and Management plans and based on our examination of the evidence supporting the assumptions, nothing has come to our attention, which causes us to believe that any material uncertainty exists as on the date of the audit report indicating that Company is not capable of meeting its liabilities existing at the date of balance sheet as and when they fall due within a period of one year from the balance sheet date. We, however, state that this is not an assurance as to the future viability of the

Company. We further state that our reporting is based on the facts up to the date of the audit report and we neither give any guarantee nor any assurance that all liabilities falling due within a period of one year from the balance sheet date, will get discharged by the Company as and when they fall due.

(xx) In respect of ongoing projects, the Company has transferred unspent Corporate Social Responsibility (CSR) amount, to a Special account before the date of this report and within a period of 30 days from the end of the financial year in compliance with the provision of section 135(6) of the Act.

For DELOITTE HASKINS & SELLS LLP	For HDS & Associates LLP
Chartered Accountants	Chartered Accountants
Firm Registration No. 117366W/ W-100018	Firm Registration No. W-100144
Nilesh Shah	Suresh K. Joshi
Partner Membership No. 049660	Partner Membership No. 030035
UDIN: 25049660BMOCBY3720	UDIN: 25030035BMJPLD1552
Place: Mumbai	Place: Mumbai
Date: 23rd May, 2025	Date: 23rd May, 2025