Kaytex Fabrics Ltd Auditor Reports

ON RESTATED FINANCIAL INFORMATION (As required by Section 26 of Companies Act, 2013 read with Rule 4 of Companies (Prospectus and Allotment of

Securities) Rules, 2014)

To,

The Board of Directors,

KAYTEX FABRICS LIMITED

Batala Road, Post Office Khanna Nagar,

Amritsar - 143 001, Punjab, India

Dear Sirs,

1. We have examined the attached Restated Financial Information of Kaytex Fabrics Limited (Formerly known as "Kaytex Fabrics Private Limited") comprising the Restated Statement of Assets and Liabilities as at October 31, 2024, March 31, 2024, March 31, 2023 & March 31, 2022. the Restated Statement of Profit & Loss, the Restated Cash Flow Statement for the period ended October 31, 2024 and for the financial year ended March 31, 2024, March 31, 2023 & March 31, 2022, the Summary statement of Significant Accounting Policies and other explanatory Information (Collectively the "Restated Financial Information") as approved by the Board of Directors in their meeting held on January 10, 2025 for the purpose of inclusion in the Offer Document, prepared by the Company in connection with its Initial Public Offer of Equity Shares ("IPO") and prepared in terms of the requirement of: -

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

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"); and

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

Managements Responsibility for the Restated Financial Information

2. The Companys Board of Directors is responsible for the preparation of the Restated Financial Information for the purpose of inclusion in the Offer Document to be filed with Stock Exchange, Securities and Exchange Board of India, and Registrar of Companies, Chandigarh in connection with the proposed IPO. The Restated Financial Information have been prepared by the management of the Company for the period ended October 31, 2024 and for the financial year ended March 31, 2024, March 31, 2023 & March 31, 2022 on the basis of preparation stated in ANNEXURE - IV to the Restated Financial Information. 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 Information. The board of directors are also responsible for identifying and ensuring that the Company complies with the Act, ICDR Regulations and the Guidance Note.

Auditors Responsibilities

3. We have examined such Restated Financial Information taking into consideration:

a) The terms of reference and terms of our engagement agreed upon with you in accordance with our engagement letter dated November 30, 2024 in connection with the proposed IPO of equity shares of the Company;

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 Information; 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 IPO.

Restated Financial Information

4. These Restated Financial Information have been compiled by the management from:

a) Special Purpose Interim Financial Statements of the Company audited by us for the period ended October 31, 2024 which have been prepared by the Company in accordance with Accounting Standards, as prescribed under Section 133 of the Act read with Companies (Accounting Standards) Rules, 2021, as amended and other accounting principles generally accepted in India, along with the presentation requirements of Division I of Schedule III to the Companies Act, 2013 (AS compliant Schedule III), as applicable, which have been approved by the Board of Directors at their meeting held on November 15, 2024; and

b) Audited Financial Statements of the Company audited by us for the year ended March 31, 2024, March 31, 2023 and March 31, 2022 which have been prepared by the Company in accordance with Accounting Standards, as prescribed under Section 133 of the Act read with Companies (Accounting Standards) Rules, 2021, as amended and other accounting principles generally accepted in India, along with the presentation requirements of Division I of Schedule III to the Companies Act, 2013 (AS compliant Schedule III), as applicable, which have been approved by the Board of Directors at their meeting held on September 04, 2024, September 02, 2023 and September 02, 2022 respectively.

Auditors Report

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

a) Auditors Report dated November 15, 2024 on the special purpose interim financial statements of the company as at and for the period ended October 31, 2024 as referred to in Paragraph 4 (a) above; and

b) Auditors Report dated September 04, 2024, September 02, 2023 and September 02, 2022 for the financial year ended March 31, 2024, March 31, 2023 and March 31, 2022 respectively on the financial statements of the company as referred to in Paragraph 4 (b) above;

6. Based on our examination and according to the information and explanation given to us, we report that the Restated

Financial Information:

a) have been prepared after incorporating adjustments for the changes in accounting policies, material errors and regrouping/reclassifications retrospectively in the period ended October 31, 2024 and financial years ended March 31, 2024, March 31, 2023 and March 31, 2022 retrospectively in respective financial years to reflect the same accounting treatment as per the changed accounting policy for all reporting periods, if any;

b) have been made after incorporating adjustments for prior period and other material amounts in the respective financial years/period to which they relate and there are no qualifications which require adjustments; and

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

7. 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 period ended October 31, 2024 and for the financial year ended on March 31, 2024, March 31, 2023 & March 31, 2022 proposed to be included in the Draft Prospectus / Prospectus ("Offer Document") for the proposed IPO:

Restated Statement of Share Capital, Reserves and Surplus	Note - I.1 & I.2
Restated Statement of Long-Term Borrowings	Note - 1.3
Restated Statement of Other Non-Current Liabilities	Note - 1.4
Restated Statement of Deferred Tax Liabilities	Note - 1.5
Restated Statement of Long-Term Provisions	Note - 1.6
Restated Statement of Short-Term Borrowings	Note - I.7
Restated Statement of Trade Payables	Note - 1.8
Restated Statement of Other Current Liabilities and Short-Term Provisions	Note - I.9 & Note - I.10
Restated Statement of Fixed Assets	Note - I.11
Restated Statement of Non-Current Investments	Note - I.12
Restated Statement of Long-Term Loans & Advances	Note - I.13
Restated Statement of Other Non-Current Assets	Note - I.14
Restated Statement of Inventories	Note - I.15
Restated Statement of Trade Receivables	Note - I.16
Restated Statement of Cash & Cash Equivalents	Note - I.17
Restated Statement of Short-Term Loans & Advances	Note - I.18
Restated Statement of Other Current Assets	Note - I.19
Restated Statement of Revenue from Operations	Note - II. 1
Restated Statement of Other Income	Note - II.2
Restated Statement of Cost of Material Consumed	Note - II.3
Restated Statement of Purchase of Stock in Trade	Note - II.4
Restated Statement of Changes in Inventories of Finished goods, WIP & Stock in Trade	Note - II.5
Restated Statement of Employee Benefit Expenses	Note - II.6
Restated Statement of Finance Cost	Note - II.7
Restated Statement of Depreciation & Amortisation	Note - II.8
Restated Statement of Other Expenses	Note - II.9
Restated Statement of Deferred Tax Asset / Liabilities	Note - II.10
Restated Statement of Earnings per Share	Note -- II.11
Restated Statement of Other Disclosure to the Restated Financial	Note - V
Restated Statement of Statement of Accounting & Other Ratios	Note - VI
Restated Statement of Capitalization	Note - VII
Restated Statement of Tax Shelter	Note - VIII
Restated statement of Related party transaction	Note - IX
Restated statement of Dividend	Note - X
Restated statement of Change in Significant Accounting Policies	Note - XI
Restated statement of Contingent Liabilities	Note - XII

Opinion

8. In our opinion and to the best of information and explanation provided to us, the Restated Financial Information of the Company, read with significant accounting policies and notes to accounts are prepared after providing appropriate adjustments and regroupings as considered appropriate.

9. We, M/s. S G U R & Co., Chartered Accountants have been subjected to the peer review process of the Institute of Chartered Accountants of India ("ICAI") and hold a valid peer review certificate issued by the "Peer Review Board" of the ICAI.

10. The preparation and presentation of the Financial Statements referred to above are based on the Audited financial statements of the Company and are in accordance with the provisions of the Act and ICDR Regulations. The Financial Statements and information referred to above is the responsibility of the management of the Company.

11. 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 report be construed as a new opinion on any of the financial statements referred to therein.

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

13. In our opinion, the above financial information read with the respective Significant Accounting Polices and Notes to Accounts are prepared after making adjustments and regrouping as considered appropriate and have been prepared in accordance with the Companies Act, ICDR Regulations, Engagement Letter and Guidance Note.

Restriction on Use

14. Our report is intended solely for use of the management and for inclusion in the Offer Document in connection with the Proposed IPO of the Company and our report should not be used, referred to or distributed for any other purpose without our prior consent in writing.

For, M/s S G U R & Co.

Chartered Accountants

FRM: 005429N

CA Sanjeev Gupta

(Partner)

Membership No. 084210

udin: 25084210BMJLSG3777

Date: 10.01.2025

Place: Amritsar