Classic Electrodes India Ltd Auditor Reports

To,

The Board of Directors

Classic Electrodes (India) Limited

(Formerly known as "Classic Electrodes (India) Private Limited")

1A, Bonfield Lane, Kolkata, West Bengal - 700001

1 We have examined the attached restated financial information of Classic Electrodes (India) Limited

(Formerly known as "Classic Electrodes (India) Private Limited") (hereinafter referred to as "the Company") comprising the restated statement of assets and liabilities as at February 28th 2025,

March 3lst 2024, March 3Lst 2023, and March 3tst 2022 , restated statement of profit and loss and restated cash flow statement for the financial period/year ended on February 29th 2025, March

3JJr 2024, March 3lst 2023, and March 3lst 2022 and the summary statement of significant accounting policies and other explanatory information (collectively referred to as the "restated financial information" or "Restated Financial Statements") annexed to this report and initialed by us for identification purposes. These Restated Financial Statements have been prepared by the management of the Company and approved by the board of directors at their meeting in connection with the proposed Initial Public Offering on EMERGE Platform ("IPO" or "EMERGE IPO") of National Stock Exchange of India Limited ("NSE") of the company.

2. These restated summary statements have been prepared in accordance with the requirements of:

(i) Section 26 of Part - I of Chapter III of Companies Act, 2013 (the "Act") read with Companies (Prospectus and Allotment of Securities) Rules 2014;

(ii) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations ²⁰¹⁸ CICDR ^{Regulations") and related amendments} / clarifications from time to time issued by the Securities and Exchange Board of India ("SEBI");

(iii) The Guidance Note on Reports in Company Prospectuses (Revised 2019) issued by the Institute of Chartered Accountants of India ("Guidance Note")

3 The Companys Board of Directors is responsible for the preparation of the Restated Financial Statements for inclusion in the Red-Herring Prospectus/ Prospectus ("Offer Document") to be filed with Securities and Exchange Board of India ("SEBI"), NSE and Registrar of Companies (Kolkata) in connection with the proposed IPO. The Restated Financial Statements have been prepared by the management of the Company on the basis of preparation stated in Annexure IV to the Restated Financial Statements. The responsibility of the board of directors of the Company includes designing, implementing and maintaining adequate internal control relevant to the preparation and presentation of the Restated Financial Statements. The board of directors are also responsible for identifying and ensuring that the Company complies with the Act, ICDR

Regulations and the Guidance Note.

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

(i) The terms of reference and terms of our engagement letter requesting us to carry out the assignment, in connection with the proposed EMERGE IPO;

(ii) The Guidance Note also requires that we comply with the ethical requirements of the Code of Ethics issued by the ICAI;

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

(iv) The requirements of Section 26 of the Act and the ICDR Regulations. Our work was peformed 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 IPO.

5 The Restated Financial Statements of the Company have been compiled by the management from audited financial statements for the period/year ended on February 28th 2025, March 3Lsr 2024,

March 3Lst 2023 and March 3tst 2022.

6 Audit for the financial period/year ended February 28rh 2025 and March 3Lsr 2024 was audited by us vide our report dt. 08th July , 2025 and 16th August 2024 respectively. Audit for the financial year ended March 3lst 2023, March 3tst 2022 was conducted by AVB & ASSOCIATES vide report dt. September 2,2023 and September 5,2022 respectively. There are no audit qualifications in the audit reports issued by previous auditors and which would require adjustments in the Restated Financial Statements of the Company. The financial report included for these years is based solely on the report submitted by him.

7 Based on our examination and according to information and explanations given to us, we are of the opinion that the Restated Financial Statements:

a) Have been prepared after incorporating adjustments for the changes in accounting policies, material errors and regrouping /reclassifications ^{retrospectively in} the financial period/year ended on February 28,2025, March 3L,2024, March 3L,2023, and March 3L,2022.

b) do not require any adjustment for modification as there is no modification in the underlying audit reports;

c) have no extra-ordinary items that need to be disclosed separately in the accounts and requiring adjustments.

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

8 In accordance with the requirements of the Act including the rules made there under, ICDR

Regulations, Guidance Note and engagement letter, we repoft that:

(i) The "restated statement of asset and liabilities" of the Company as at February 28,

2025,March 3L,2024,March31-,2023,andMarch3L,2022examinedbyus,assetoutin

Annexure I to this report read with significant accounting policies in Annexure IV has been arrived at after making such adjustments and regroupings to the audited financial statements of the Company, as in our opinion were appropriate and more fully described in notes to the restated summary statements to this report.

(ii) The "restated statement of profit and loss" of the Company for the financial period/year ended as at February 28, 2025, March 3t,2024, March 3t, 2023, and March 3L, 2022 examined by us, as set out in Annexure II to this report read with signiflcant accounting policies in Annexure IV has been arrived at after making such adjustments and regroupings to the audited financial statements of the Company, as in our opinion were appropriate and more fully described in notes to the restated summary statements to this report.

(iii) The "restated statement of cash flows" of the Company for the financial period/year ended as at February 28, 2025, March 31, 2024, March 3L, 2023, and March 37, 2022 examined by us, as set out in Annexure III to this report read with significant accounting policies in Annexure IV has been arrived at after making such adjustments and regroupings to the audited financial statements of the Company, as in our opinion were appropriate and more fully described in notes to restated summary statements to this report

(iv) The Company has mentioned in the Note-l to Annexure-XLlil of the restated financial statements that:

"The Company has not accounted for interest provision as per MSMED Act, 2006 before April 07, 2024 as the company has made payments to MSME vendors within contractual period which is exceeding the contractual time-limit as per MSMED Act, 2006 and the amount payable to them are agreed between the company and the vendors considering the contractua I credit period. "

Hence, the company has not accounted for interest provisions as per MSMED Act, 2006 before April 01, 2024 as they had contractual credit period of more than stipulated period as per MSMED Act, 2006. However, the company should have accounted for the interest as per the provisions of MSMED Act, 2006 and as a result of which the profit would have been lower by the interest amount as payable as per the provisions of MSMED Act, 2006.

9 We have also examined the following other financial information relating to the Company prepared by the management and as approved by the board of directors of the Company and annexed to this report relating to the Company for the flnancial period/year ended as at February 28th 2025, March 3tst 2024, March 3tst 2023, and March 3lst 2022 proposed to be included in the Offer

Document.

Annexure to Restated Financial Statements of the Company:-

L Summary statement of assets and liabilities, as restated as appearing in ANNEXURE I; II. Summary statement of proflt and loss, as restated as appearing in ANNEXURE II; III. Summary statement of cash flows as restated as appearing in ANNEXURE III;

IV. Corporate Information, Significant accounting policies as restated and Notes to reconciliation of restated profits and net worth as appearing in ANNEXURE IV; V. Details of share capital as restated as appearing in ANNEXURE V to this report;

VI. Details of reserves and surplus as restated as appearing in ANNEXURE VI to this repoft;

VII. Details of long-term borrowings as restated as appearing in ANNEXURE VII to this report; VIIL Details of deferred tax Liabilities (net) as appearing in ANNEXURE VIII to this report; IX. Details of long-term provisions as restated as appearing in ANNEXURE IX to this report; X. Details of shoft-term borrowings as restated as appearing in ANNEXURE X to this report;

XL Details of trade payables as restated as appearing in ANNEXURE XI to this report;

XIL Details of other current liabilities as restated as appearing in ANNEXURE XII to this report;

XIII. Details of short-term provisions as restated as appearing in ANNEXURE XIII to this repoft;

XIV. Details of property, plant & equipment and intangible assets as appearing in ANNEXURE

XIV to this report;

XV. Details of non-current investments as restated as appearing in ANNEXURE XV to this report; XVI. Details of long-term loans and advances as restated as appearing in ANNEXURE XVI to this report; XVII. Details of other non-current assets as restated as appearing in ANNEXURE XVII to this report; XVIIL Details of inventories as restated as appearing in ANNEXURE XVIII to this report;

XIX. Details of trade receivables as restated as appearing in ANNEXURE XIX to this report; xX. Details of cash and bank balance as restated as appearing in ANNEXURE XX to this repoft; xXI. Details of short-term loans and advances as restated as appearing in ANNEXURE XXI to this report; XXIL Details of revenue from operations as restated as appearing in ANNEXURE XXII to this report; XXIII. Details of other income as restated as appearing in ANNEXURE XXIII to this repoft. XXru. Details of cost of materials consumed as restated as appearing in ANNEXURE XXIV to this report; xXV. Details of purchase of stock-in-trade as restated as appearing in ANNEXURE XXV to this report; XXVL Details of direct expenses as restated as appearing in ANNEXURE XXVI to this reporq XXVII. Details of changes in inventories of work-in-progress and finished goods as restated as appearing in ANNEXURE XXVII to this report;

XXVIII Details of employee benefit expenses as restated as appearing in ANNEXURE XXVIII to this reporU xxlx. Details of finance cost as restated as appearing in ANNEXURE XXIX to this report; xxx. Details of depreciation and amoftization expenses as restated as appearing in ANNEXURE

XXX Ito this report; xxxr. Details of other expenses as restated as appearing in ANNEXURE XXXI to this report; XXXII. Details of other income as restated as appearing in ANNEXURE XXXII to this report; XXXIII. Ageing of trade payable as restated as appearing in ANNEXURE XXXIII to this report; xxxry. Ageing of trade receivable as restated as appearing in ANNEXURE XXXIV to this report; xxxv. Details of related party transaction as restated as appearing in ANNEXURE XXXV to this report; xxxvl. Disclosure under AS-15 as restated as appearing in ANNEXURE XXXVI to this report;

XXXVII. Summary of significant accounting ratios as restated as appearing in ANNEXURE XXXVII to this report;

XXXVIII. Statement of tax shelters as restated as appearing in ANNEXURE XXXVIII to this report; xxxIx. Details of contingent liabilities & commitment as restated as appearing in ANNEXURE

XXXIX to this report;

XL. Details of restated value of imports calculated on C.I.F. basis by the company during the financial period/year as appearing in ANNEXURE XL to this report; XLI Details of expenditure in foreign currency during the financial period/year as restated as appearing in ANNEXURE XLI to this report;

XLII Details of earnings in foreign exchange as restated as appearing in ANNEXURE XLII to this report; XLIII Details of dues of small enterprises and micro enterprises as restated as restated as appearing in ANNEXURE XLIII to this report;

XUV Additional Regulatory Information as per Para Y of Schedule III to Companies Act, 2013 as restated as appearing in ANNEXURE XLIV to this report; XLV. Capitalisation Statement as at February 28, 2025 as restated as appearing in ANNEXURE

XLV to this repoft;

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 any other firm of Chartered Accountants nor should this repoft 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.

L2. Our report is intended solely for use of the board of directors for inclusion in the offer document to be filed with SEBI, NSE and Registrar of Companies (Kolkata) in connection with the proposed

EMERGE 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.

For, KPMR & Associates

Chartered Accountants

FRN: OO25O4N

\

 

CA Vishal Kumar Agarwal

Paftner

M.No.:303733

U DIN : 2s3O37 33BMJQPI1985

Place: Kolkata

Date: 08,07.2025