Knowledge Marine & Engineering Works Ltd Auditor Reports

To the Members of

Knowledge Marine & Engineering Works Limited

Report on the Audit of the Standalone Financial Statements Opinion

We have audited the accompanying Standalone Financial Statements of Knowledge Marine & engineering works Limited (the Company), which comprise the Balance Sheet as at 31st March, 2026, the Statement of Profit and Loss (including Other Comprehensive Income), the Statement of Changes in Equity and the Statement of Cash Flows for the year ended on 31st March, 2026, and a summary of the significant accounting policies and other explanatory information. In our opinion and to the best of our information and according to the explanations given to us, except for the matter described in Emphasis of Matter, 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 read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, (Ind AS) and other accounting principles generally accepted in India, of the state of affairs of the Company as at 31st March, 2026, the profit and loss total comprehensive income, changes in equity and its cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs), as specified under Section 143(10) of the Act. Our responsibilities under those Standards are further described in the Auditors Responsibilities for the Audit of the Financial Statement 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 financial statements under the provisions of the Act and the rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on the financial statements.

Emphasis of Matter

The Company had raised a claim of Rs.39.01 crores (incl. GST) in FY 2024-25 on one of its client. Out of the above, the Company has received Rs.14.13 crores in FY 2024-25, with balance of Rs.24.89 crores outstanding for more than one year as on 31st March 2026. Management is confident of recovering the same from due to receipt of Rs.8.60 crores in the current year and is hopeful of receiving the balance amount in the due course. Hence, no provision is considered by the management as on 31st March 2026. Our conclusion on the Statement is not modified in respect of the above matter.

Key Audit Matters

Key audit matters are those matters that, in our professional 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 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.

a. Capitalization of Property, Plant and Equipment (Refer Note No. 1 and Note A of Significant Accounting Policies Clause 1.6 of the Standalone Financial Statements)

Given the company is in an expansion phase, the recognition and measurement of Property, plant and equipment are pivotal to the financial statements as it is crucial to support the growth strategy. These assets are capitalized once the assets are ready for use as intended by the management and are initially recorded at cost directly attributable for bringing the asset into its intended use. Subsequently, they are measured at cost less accumulated depreciation and impairment loss, if any. As a result, the aforesaid matter was determined to be a key audit matter.

How the matter was addressed in our audit:

Our audit procedures to assess the accounting for Property, Plant and Equipment (PPE) included the following. i. Assessing the companys policies and procedure for the initial recognition and measurement of PPE to ensure compliance with IND AS 16 Property, Plant and Equipment. ii. Reviewing supporting documentation for verification of cost of acquisition or construction and ownership of PPE. iii. Assessing the appropriateness of depreciation methods and the reasonableness of useful lives applied to PPE. iv. Reviewing the disclosure requirements related to PPE in the financial statements, including accounting policies, depreciation methods and significant assumptions.

b. Capital Work- in-Progress Refer Note No. 1 and Note A Significant Accounting Policies Clause 1.6 of the Standalone Financial Statements)

In the expansion phase, the Company has made substantial investment in Capital work-in-progress (CWIP), which comprises vessels currently under construction. Company has invested Rs.93.01 Crores during F.Y. 2025-26 & has given capital advance of Rs.18 crores which compared to last year was Rs.101.30 Crore as per standalone financial statements for F.Y. 2024-25. Given the substantial importance of these CWIP investments, there are inherent challenges related to accurate recognition, measurement and disclosure of these assets in the financial statements How the matter was addressed in our audit: Our audit procedures to assess the accounting for CWIP included the following. i. Evaluation of the completeness and accuracy of the project cost capitalized as CWIP. This includes reviewing invoices, contracts, and other supporting documentation. ii. Ensuring the cost capitalized meets the recognition criteria as per IND AS 16 Property, Plant and Equipment. iii. Evaluation of effectiveness of internal controls over capitalization of project costs. iv. Reviewing the disclosure requirement for capital WIP in the financial statements.

c. Issuance of shares & warrants on Preferential issue –

During the financial year 2025-26, the Company issued and allotted 14,21,054 equity shares on a preferential basis and 77,946 convertible warrants amounting to Rs.284.81 Crores at a face value of 10 per share and premium of Rs.1890 per share. The issuance was approved by the Board of Directors on 17th September, 2025. The offering, subscription, and allotment were completed within the timeline

How the matter was addressed in our audit:

1. Verified the approval of the Board of Directors and relevant committees, including review of resolutions passed for issuance of shares & warrants on preferential basis.

2. Examined the offer letters, placement memoranda, to understand the terms and conditions of the issuance.

3. Verified the receipt of funds against the issuance of shares through bank statements and other supporting documents.

4. We reviewed the financial statements to ensure they are appropriately disclosed, providing sufficient information for users to understand the transaction and its financial impact. We also reviewed the adequacy and accuracy of the disclosures made in the Notes to Accounts, specifically regarding the movement in share capital and the impact on the Diluted Earnings Per Share (EPS) as per Ind AS 33.

5. Verified that the Company has filed the Return of Allotment (Form PAS-3) with the Registrar of Companies (ROC) within the prescribed timelines and examined the details filed therein with respect to the shares issued during the year.

d. Acquisition of Knowledge Shipyard Pvt. Ltd. by the Company

During the financial year 2025-2026, KMEW acquired 51% stake in Knowledge Shipyard Pvt. Ltd. (formerly known as Kamal Marine Pvt. Ltd.). The acquisition was completed for a total consideration of 121.87 lacs. As a result of this transaction, goodwill amounting to 55.81 lacs has been recognised in the financial statements.

How the matter was addressed in our audit:

1. We examined the Board approval dated 30th May, 2025, along with the corresponding Board Resolutions and share transfer forms, to verify the formal terms and conditions of the acquisition. Our review focused on confirming the purchase consideration and the specific date of obtaining control. The transaction was executed in full compliance with the statutory provisions of the Companies Act and relevant regulatory frameworks.

2. We evaluated the independent valuation report commissioned by the management to determine the fair value of the assets acquired and liabilities assumed.

3. We have verified the payment of the Purchase consideration through inspection of bank statements.

4. We reviewed the disclosures in the financial statements related to the purchase of shares to ensure they are complete and accurate, providing sufficient information for users to understand the transaction and its financial impact.

5. During the year, Knowledge Marine & Engineering Works Limited acquired 51% equity stake in Knowledge Shipyard Private Limited, (formerly known as Kamal Marine Pvt. Ltd.) resulting in the entity becoming a subsidiary of the Group. Consequently, the remaining 49% equity interest held by other shareholders has been recognized as Non-Controlling Interest (NCI) in the consolidated financial statements.

e. Acquisition of Indian Ports Dredging Pvt. Ltd. and Knowledge Infra Ports Pvt. Ltd. by the Company -

During the financial year 2025-2026, Knowledge Marine & Engineering Works Limited (KMEW) acquired balance 29.99% equity shares of Indian Ports Dredging Pvt. Ltd. (IPDPL) and 23.99% shares of Knowledge Infra Ports Pvt. Ltd., thereby making the two companies its wholly owned subsidiaries. The acquisition was completed for a total consideration of Rs.41.52 lacs for IPDPL and Rs.34.43 lacs for Knowledge Infra Pvt. Ltd.

How the matter was addressed in our audit:

1. We examined the Board approval dated – 30th May, 2025 along with the corresponding Board Resolutions and share transfer forms, to verify the formal terms and conditions of the acquisition. Our review focused on confirming the purchase consideration and the specific date of obtaining control. The transaction was executed in full compliance with the statutory provisions of the Companies Act and relevant regulatory frameworks.

2. We evaluated the independent valuation report commissioned by the management to determine the fair value of the assets acquired and liabilities assumed.

3. We have verified the payment of the Purchase consideration through inspection of bank statements and other supporting documents.

4. We reviewed the disclosures in the financial statements related to the purchase of shares to ensure they are complete and accurate, providing sufficient information for users to understand the transaction and its financial impact.

f. Transactions with Knowledge Shipyard Pvt. Ltd.

During the year the company engaged in significant transactions with Knowledge Shipyard Pvt. Ltd. (Formerly known as Kamal Marine & Engineering Works Private Limited), Subsidiary Company and a related party of the Company.

These transactions involved of Rs.15.60 crores and Capital Advance of Rs. 18 crores. These transactions raise key audit consideration due to the inherent risks associated with related party transactions. As a result, the aforesaid matter was determined to be a key audit matter.

How the matter was addressed in our audit:

Our audit procedures to assess the accounting for the transactions with Knowledge Shipyard Pvt. Ltd. included the following.

1. Identification of all transactions with KSPL and assess whether they have been appropriately disclosed in the financial statements.

2. Evaluatingtheeffectivenessofinternalcontrolsoverrelatedpartytransactions,includingauthorization,documentation, and review procedures.

3. Performing inquiries with management and key personnel to identify any undisclosed arrangements and agreements between the company and KSPL.

Information other than the Financial Statements and Auditors Report thereon.

Companys Board of Directors is responsible for the preparation of the other information. The other information comprises the information included in the Management Discussion & Analysis, Boards Report including Annexure to Boards Report, Corporate Governance Report and Shareholders Information but does not include the 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 financial statements, our responsibility is to read the other information and, in doing so, consider whether such other information is materially inconsistent with the financial statements or our knowledge obtained during the course of our audit or otherwise appears to be materially misstated. 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.

Managements and Board of Directors Responsibility for the Standalone Financial Statements

Companys Management and Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (the Act) with respect to the preparation and presentation of these standalone financial statements in term of the requirements of the Act that give a true and fair view of the financial position, changes in equity, profit and loss (financial performance), and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Indian Accounting standards 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 of 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 the 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, which have been used for the purpose of preparation of the financial statements by the Management and Directors of the Company, as aforesaid.

In preparing the 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 management / Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so. Those Board of Directors are also responsible for overseeing the Companys financial reporting process.

Auditors Responsibilities for the Audit of the Financial Statements.

Our objectives are to obtain reasonable assurance about whether the 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 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 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 control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Companies Act, 2013, we are also responsible for expressing our opinion on whether the company has adequate internal financial controls system 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 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 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 financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. 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 (i) in 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 control 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 financial statements for the year ended 31st March 2026 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.

Report on Other Legal and Regulatory Requirements

1) As required by Section 143(3) of the Act, based on our audit, we report 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 of the aforesaid financial statements; b) In our opinion, proper books of account as required by law relating to preparation of the aforesaid standalone financial statements have been kept by the Company so far as it appears from our examination of those books. c) The Balance Sheet, the Statement of Profit and Loss including other comprehensive income, the Cash flow statement and statement of changes in equity dealt with by this Report are in agreement with the books of account and returns (as per sub section 143(3)); d) In our opinion, the aforesaid Standalone Financial Statements comply with the Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Act. e) On the basis of written representations received from the Directors as on 31st March 2026 taken on record by the Board of Directors, none of the Directors is disqualified as on 31st March 2026 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 over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate report in Annexure B. Our report expresses an unmodified opinion on the adequacy and operating effectiveness of the Companys Internal Financial Controls over financial Reporting. 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 read with Schedule V of the Act. h) With respect to the other matters to be included in the Auditors Report in accordance with the Rule 11 of Companies (Audit and Auditors) Rules, 2014 (as amended), in our opinion and to the best of our information and according to the explanation given to us: i. The Company has disclosed the impact of pending litigations on its financial position in its standalone financial statements – Refer Note B to the standalone financial statements; ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses. iii. During the year, no amounts were required to be transferred to the Investor Education and Protection Fund by the Company. So, the question of delay in transferring such sums does not arise. iv. a) The management has represented that, to the best of its knowledge and belief, other than as disclosed in the notes to accounts to the standalone 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 to or in any other person or entity, including foreign entities (Intermediaries), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, 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 management has represented that, to the best of its knowledge and belief, no funds have been received by the Company from any person or entity, including foreign entities (Funding Parties), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, 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; and c) Based on such audit procedures performed that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (a) and (b) contain any material misstatement.; and v. The Company has not declared or paid any dividend during the year. vi. Based on our examination which included test check, the Company has used accounting software for maintaining its books of account for the financial year ended March 31, 2026 which has a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the software system. 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 of India in terms of Section 143(11) of the Act, we give in Annexure A a statement on the matters specified in paragraphs 3 and 4 of the Order.

Annexure A to the Independent Auditors Report

Annexure A to the Independent Auditors Report of even date to the members of Knowledge Marine Engineering and Works Ltd., on the financial statements for the twelve months period ended 31st March 2026.

Based on the audit procedures performed for the purpose of reporting a true and fair view on the financial statements of the Company and taking into consideration the information and explanations given to us and the books of account and other records examined by us in the normal course of audit, and to the best of our knowledge and belief, we report that: i. In respect of the Companys property, plant and equipment and intangible assets: a. According to the information and explanation given to us and based on the records produced before us, we are of the opinion that the Company is maintaining proper records showing full particulars including quantitative details and situation of fixed assets. b. The Company has maintained proper records showing full particulars of Intangible assets. c. According to the information and explanation given to us, fixed assets are physically verified by the management at reasonable intervals and no material discrepancy was noticed during such verification. d. According to the information and explanation given to us, the title deeds of the immovable properties (other than properties where the company is the lessee and the lease agreements are duly executed in favour of the lessee) are held in the name of the company. e. According to the information and explanation given to us, the Company has not revalued its Property, Plant and Equipment (including Right of Use assets) or intangible assets or both during the year. f. According to the information and explanation given to us, no proceedings have been initiated or are pending against the company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder during the year. ii. In respect of the Companys Inventory a. As explained to us, the inventories have been physically verified during the year by the management. In our opinion, having regard to the nature and location of stocks, the frequency of the physical verification is reasonable. As informed to us, any discrepancies of 10% or more in the aggregate for each class of inventory were not noticed on such verification. b. Company is in the business of providing services related to Shipping and does not have any physical inventories. Accordingly, reporting under clause 3(ii) is not applicable to the Company. But during the course of services there are some consumables (such as fuel) used which are purchased as per the requirement and the same appears as closing inventory. c. As disclosed in Note – 13 to the financial statements, the Company has been sanctioned working capital limits in excess of Rupees five crores in aggregate from Banks during the year on the basis of security of current assets of the Company. The quarterly statements filed by the Company with such banks and financial institutions are lower than book balance largely because of closing the books after passing necessary accrual entries for quarter end.

iii. According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has made investments, given advance and provided corporate guarantee or security on behalf of its subsidiaries / associates / JVs during the year, details of such investments and guarantees are stated in sub-clause (a) below. a. I. To Subsidiaries, Joint Ventures, Associates – Investments (Rs. in Lakhs)

II. To Subsidiaries, Joint Ventures, Associates – Corporate Guarantee (Rs. in Lakhs)

# M/s Knowledge Marine & Engineering Works Limited has released the Corporate Guarantee given to banks on behalf of KMEW offshore Pvt. Ltd. and Knowledge Marine Co. WLL. Since the loan have been repaid, the guarantees are released.

III. To Subsidiaries, Joint Ventures, Associates – Advance / loan (unsecured) (Rs. in Lakhs)

b. According to the information and explanations given to us and based on the audit procedures conducted by us, we are of the opinion that the terms and conditions of the investments and advance given /made are, prima facie, not prejudicial to the interest of the Company. c. According to the information and explanations given to us and on the basis of our examination of the records of the Company, in the case of advance and loan given, payment of interest had been stipulated by the Company. d. According to the information and explanations given to us and on the basis of our examination of the records of the Company, the advance and the loan amount has been settled during the year as per the terms of agreement. e. Since no loan /advance is outstanding at the year end, and according to the information and explanations given to us and on the basis of our examination of the records of the Company, the question of loan / advance given falling due during the year doesnt arise. f. According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has not given advance / loan which is either repayable on demand or without specifying any terms or period of repayment. iv. In our opinion and according to information and explanation given to us, the company has, in respect of loans / advance, investments, guarantees, and security provisions, complied with section 185 and 186 of the Companies Act, 2013. v. According to the information and explanation given to us, the Company has not accepted any deposits, whether the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or any other relevant provisions of the Companies Act, 2013. Hence the provisions of clause (v) of Paragraph 3 are not applicable to the Company.

vi. To the best of our knowledge and belief, the Central Government has not specified maintenance of cost records under sub-section (1) of Section 148 of the Act, in respect of Companys products/ services. Accordingly, the provisions of clause 3(vi) of the Order are not applicable.

vii. a. According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including Goods and Services Tax (GST), Provident fund, Employees State Insurance, Income-tax, Duty of Customs, Cess and other material statutory dues have generally been regularly deposited (except a few instances of delay) with the appropriate authorities. Further, no undisputed amounts payable in respect thereof were outstanding at the year-end for a period of more than six months from the date they became payable.

b. According to the information and explanations given to us, there are no dues of GST, Provident fund, Employees State Insurance, Income-tax, Sales tax, Duty of Customs, Value added tax, Cess or other statutory dues which have not been deposited by the Company on account of dispute except as stated below

viii. According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has not surrendered or disclosed any transactions, previously unrecorded as income in the books of account, in the tax assessments under the Income-tax Act, 1961 as income during the year. ix. a. According to the information and explanation given to us and based on the records produced before us, the Company has not defaulted in repayments of dues to financial institutions and banks; b. According to the information and explanation given to us, the Company is not declared as a willful defaulter by any Bank or Financial Institution or other lender; c. During the year under review, in our opinion and according to information and explanation given to us, the Company has taken term loan of Rs. 112.34 Crores, which was applied for the purpose for which the loan was taken. d. According to the information and explanation given to us, the funds raised for short term basis have not been utilized for long term purposes by the company; e. According to the information and explanation given to us, the Company has not taken any funds from any entity or person on account of or to meet the obligations of its subsidiaries, associates or joint ventures; f. According to the information and explanation given to us, the Company has not raised loans during the year on the pledge of securities held in its subsidiaries, joint ventures or associate companies. x. a. During the year, the Company has not raised any moneys by way of initial public offer or further public offer (including debt instruments). Accordingly, clause 3(x)(a) of the Order is not applicable. b. According to the information and explanations given to us and on the basis of our examination of the records of the Company, the Company has raised funds by way of preferential allotment of equity shares & convertible warrants. As informed, the requirements of section 42 and section 62 of the Companies Act, 2013 have been complied with. The funds raised are proposed to be utilized towards working capital, capital expenditure and general corporate purpose. As on March 2026, Rs.13.63 Crores is utilized and balance funds are parked in Fixed deposits.

# 25% of the consideration received, balance to be received within 18 months from the date of allotment. xi. a. During the course of our examination of the books of account carried in accordance with the generally accepted auditing standards in India, we have neither come across any instance of fraud on or by the Company, either noticed or reported during the year, nor have we been informed of such case by the Management. b. According to the information and explanations given to us, no report under sub-section (12) of Section 143 of the Companies Act, 2013 has been filed by the auditors in Form ADT-4 as prescribed under Rule 13 of Companies (Audit and Auditors) Rules, 2014 with the Central Government. c. As represented to us by the management, there are no whistle blower complaints received by the Company during the year. Therefore, clause xi(c) of paragraph 3 is not applicable. xii. Company is not Nidhi Company and hence Clause (xii) of the Companies (Auditors) Report Order 2020 is not applicable. xiii. In our opinion and according to the information and explanations given to us, the transactions with related parties are in compliance with Sections 177 and 188 of the Companies Act, 2013, where applicable, and the details of the related party transactions have been disclosed in the standalone financial statements as required by the applicable Indian Accounting Standards. xiv. a. Based on information and explanations provided to us and our audit procedures, in our opinion, the Company has an internal audit system commensurate with the size and nature of its business. b. The internal audit reports of the Company issued till 31st March 2026, for the period under audit have been considered by us. xv. In our opinion and according to the information and explanations given to us, the Company has not entered into any non-cash transactions with its directors or persons connected to its directors and hence, provisions of Section 192 of the Companies Act, 2013 are not applicable to the Company. xvi. According to the information and explanations given to us, we are of the opinion that the company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934 and the company is not a Core Investment Company (CIC) as defined in the regulations made by the Reserve Bank of India, accordingly the provisions of clause 3(xvi) of the Order are not applicable. xvii. According to the information and explanations given to us and based on the audit procedures conducted we are of opinion that the company has not incurred any cash losses in the financial year and the immediately preceding financial year. xviii. There has been no resignation of the statutory auditors during the year. Accordingly, clause (xviii) of Paragraph 3 of the Order is not applicable. xix. According to the information and explanations given to us, 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, 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 incapable 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. a. In our opinion and according to the information and explanations given to us, there is no unspent amount under sub-section (5) of Section 135 of the Companies Act, 2013 in respect of other than ongoing project. Accordingly, clauses (xx)(a) of Paragraph of the Order are not applicable. b. In our opinion and according to the information and explanations given to us, there are no ongoing projects as per section 135 of the Companies Act. Accordingly, clauses (xx)(b) of Paragraph 3 of the Order are not applicable.

Annexure B to the Independent Auditors Report

Annexure B to the Independent Auditors Report of even date to the members of Knowledge Marine and Engineering Works Limited on the financial statements for year ended on 31st March 2026. Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (the Act)

We have audited the internal financial controls over financial reporting of Knowledge Engineering & Works Limited (the Company) as of 31st March 2026 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that date.

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting with reference to these Standalone Financial Statements and such internal financial controls over financial reporting were operating effectively as at 31st March 2026, based on the internal control over financial reporting 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.

Managements Responsibility for Internal Financial Controls

Companys management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting 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 (ICAI). 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 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 over financial reporting with reference to these Financial Statements 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) and the Standards on Auditing as specified under Section 143(10) of the Act, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. 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 over financial reporting with reference to these 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 system over financial reporting with reference to these Financial Statements and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, 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 judgment, 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 is sufficient and appropriate to provide a basis for our audit opinion on the internal financial controls over financial reporting with reference to these Financial Statements.

Meaning of Internal Financial Controls over Financial Reporting with reference to these Financial Statements

Companys internal financial control over financial reporting 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 over financial reporting with reference to these 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 authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companys assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial Controls over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting with reference to these 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 over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.