Happy Steels Ltd Auditor Reports

ON RESTATED FINANCIAL INFORMATION

To

The Board of Directors Happy Steels Limited

(Formerly known as Happy Steels Private Limited)

Village Jaspal Bangar, Kanganwal Road, Ludhiana, Punjab-141122

Dear Sir,

1. We Davinder Pal Singh & Co. have examined the attached restated financial information of "Happy Steels Limited" (hereinafter referred to as "the Company" or "the Issuer") for the period ended 31st March, 2026,

31st March 2025 and 31st March 2024 which comprise of the restated statement of assets and liabilities, restated statement of Profit and Loss, restated cash flow statement 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 initiated 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 held on 17.06.2026 in connection with the proposed Initial

Public Offering on SME Platform ("IPO") of the stock exchange of the company.

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

a. section 26 of Part I of Chapter III of Companies Act, 2013 (the "Act") read with Companies

(Prospectus and Allotment of Securities) Rules 2014; b. The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements)

Regulations 2018 ("ICDR Regulations") and related amendments/ clarifications from time to time issued by the Securities and Exchange Board of India ("SEBI"); c. The Guidance Note on Reports in Company Prospectuses (Revised2019) issued by the Institute of

Chartered Accountants of India ("Guidance Note")

Emphasis of Matter

a) The company has restated the financial statements for the last 3 years. These Restated Financial Statements have been prepared by the Companys management solely for the purpose of inclusion in the Red Herring

Prospectus (RHP) to be filed with the Securities and Exchange Board of India, Stock Exchange(s) and the Registrar of Companies, in accordance with the applicable provisions of the Companies Act, 2013 and the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018. Accordingly, these Restated Financial Statements may not be suitable for any other purpose.

Managements Responsibility for the Restated Financial Information

3. The Companys Board of Directors is responsible for the preparation of the Restated Financial Statements for inclusion in the Red Herring Prospectus/Prospectus for the purpose of inclusion in the RHP to be filed with the SME platform of the Stock Exchange (where the equity shares of the Company are proposed to be listed) and ROC in connection with the proposed Offering. The Restated Financial Information has been prepared by the management of the Company based on "basis of preparation" as stated in Restated Financial

Information. 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 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 term so far engagement letter requesting us to carry out the assignment, in connection with the proposed SME IPO; b. 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; 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 IPO.

5. The Restated Financial Statements of the Company have been compiled by the management from audited financial statements for the period ended 31st March, 2026, 31st March 2025 and 31st March 2024 approved in the meeting of Board of Directors 15.06.2026, 28.08.2025 and 26.08.2024 prepared in accordance with AS as prescribed under Section 133 of the Act read with Companies (Accounting Standards) Rules 2014, as amended, and other accounting principles generally accepted in India, which have been approved by the Board of Directors at their meeting held on 17.06.2026.

6. The restated financial information pertaining to the financial years ended March 31 2026; March 31, 2025 and March 31, 2024 has been extracted and compiled by the management from the respective audited financial statements. The financial statements for the financial years 2025-26 and 2024-25 have been audited by us and for financial year 2023-24 have been audited by Gupta Sharma & Associates. To our examination, we have relied on our Auditors report and the audited financial statements issued by us and by Gupta Sharma & Associates on 26.08.2024 for the above-mentioned financial years.

7. In terms of Schedule VI of the SEBI (ICDR) Regulations, 2018 and other provisions relating to accounts of Happy Steels Limited, we, Davinder Pal Singh & Co., Chartered Accountants, have been subjected to the peer review process of the Institute of Chartered Accountants of India (ICAI) and our certificate is valid as on date.

8. Based on our examination, we further report that:

a. The Restated Statement of Balance Sheet as set out in this report, of the Company for the reporting periods are prepared by the Company and approved by the Board of Directors. These Restated Balance Sheet have been arrived at after making such adjustments/regroupings to the financial statements of the Company, as in our opinion were appropriate and more fully described in Significant Accounting Policies and Notes to Restated Financial Statement as set out in this Report.

b. The Restated Statement of Profit and Loss as set out in this report of the Company for the reporting periods are prepared by the Company and approved by the Board of Directors. These Restated Statement of Profit and Loss have been arrived at after making such adjustments/regroupings to the financial statements of the Company, as in our opinion were appropriate and more fully described in Significant Accounting Policies and Notes to Restated Financial Statement as set out in this Report.

c. The Restated Statement of Cash Flow as set out in this report of the Company for the reporting periods are prepared by the Company and approved by the Board of Directors. These Restated Statement of Cash Flow have been arrived at after making such adjustments/regroupings to the financial statements of the Company, as in our opinion were appropriate and more fully described in Significant Accounting Policies and Notes to Restated Financial Statement as set out in this Report.

d. The restated financial information has been made after incorporating adjustments for:

i) The changes in accounting policies, material errors, and regrouping/ reclassifications to reflect the same accounting treatment across all the reporting periods. ii) Provisions for Gratuity for the period ended 31st March, 2026, 31st March 2025 and 31st March

2024 to report the same as per the principles laid out in accounting standard 15 on ‘Employee Benefits.

e. There were no qualifications in the Audit Reports and Annexures to the auditors report issued under

Companies (Auditors Reports) Order, 2020 issued by the Statutory Auditors for the period ended 31st March, 2026, 31st March 2025 and 31st March 2024 which would require adjustments in this Restated Financial Statements of the Company.

f. The Company has not paid dividend for any Financial Year.

9. In our opinion, the Restated Financial Information have been prepared in accordance with Section 26 of Companies Act, 2013 and the SEBI Regulations and the Guidance Note on the Reports in Company Prospectus (Revised 2019) issued by the Institute of Chartered Accountants of India (ICAI). Consequently, the financial information has been prepared after making such adjustments/regroupings as were, in our opinion, considered appropriate to comply with the same. As a result of these adjustments/regroupings, the amount reported in the financial information may not necessarily be the same as those appearing in the respective financial statements audited for the relevant years.

10. This 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 nor should this report be construed as a new opinion on any of the financial statements referred to therein. 11. We have complied with the relevant applicable requirements of the Standard on Quality Control (SQC) 1,

Quality Control for Firms that Perform Audits and Reviews of Historical Financial Information, and Other Assurance and Related Services Engagements.

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

13. Our report is intended solely for use of the Board of Directors for inclusion in the Offer documents to be filed with relevant stock exchanges, and Registrar of Companies 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.

For Davinder Pal Singh & Co.

Chartered Accountants

Firm Reg. No. 07601N

Sd/-

(Arun Rattan)

Partner

M. No. 508414

Place: Ludhiana

Date: 17.06.2026

UDIN: 26508414JGPYLL9864