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Sambhv Steel Tubes Ltd Auditor Reports

97.59
(19.01%)
Jul 2, 2025|12:00:00 AM

Sambhv Steel Tubes Ltd Share Price Auditors Report

To,

The Board of Directors Sambhv Steel Tubes Limited

(Formerly known as Sambhv Steel Tubes Private Limited and Sambhv Sponge Power Private Limited)

Office no. 501 to 511 Harshit Corporate Amanaka, Raipur Chhattisgarh, India 492001

Dear Sirs/Madams,

1. We, S S Kothari Mehta & Co. LLP, Chartered Accountants, have examined, the Restated Financial Statements of Sambhv Steel Tubes Limited (Formerly known as Sambhv Steel Tubes Private Limited and Sambhv Sponge Power Private Limited) (the "Company" or the "Issuer"), comprising the Restated Statement of Assets and Liabilities as at March 31, 2024, March 31, 2023 and March 31 2022, the Restated Statement of Profit and Loss (including Other Comprehensive Income), the Restated Statement of Changes in Equity, the Restated Statement of Cash Flows for the years ended March 31, 2024, March 31, 2023 and March 31 2022, and the statement of material accounting policies, and other explanatory information (collectively, the "Restated Financial Statements"), as approved by the Board of Directors of the Company at their meeting held on September 28, 2024 for the purpose of inclusion in the Draft Red Herring Prospectus ("DRHP"), prepared by the Company in connection with its proposed Initial Public Offer of equity shares ("IPO") prepared in terms of the requirements of:

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

b) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018, as amended ("SEBI ICDR Regulations"); and

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

2. The Companys Board of Directors is responsible for the preparation of the Restated Financial Statements for the purpose of inclusion in the DRHP to be filed with Securities and Exchange Board of India ("SEBI") and the stock exchanges where the equity shares of the Company are proposed to be listed ("Stock Exchanges"), in connection with the proposed IPO. The Restated Financial Statements have been prepared by the management of the Company in accordance with the basis of preparation stated in Note 2.1 of Annexure V to the Restated Financial Statements.

The Board of Directors ofthe Company is responsible for designing, implementing and maintaining adequate internal control relevant to the preparation and presentation of the Restated Financial

Statements. The Board of Directors of the company is also responsible for identifying and ensuring that the company complies with the Act, the SEBI ICDR Regulations and the Guidance Note.

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

a) The terms of reference and our engagement agreed upon with you in accordance with our engagement letter dated September 28, 2024, requesting us to carry out the assignment, in connection with the proposed IPO of equity shares of the Company;

b) The Guidance Note - 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; and

d) The requirements of Section 26 of the Act and the SEBI ICDR Regulations.

Our work was performed solely to assist you in meeting your responsibilities in relation to your compliance with the Act, the SEBI ICDR Regulations and the Guidance Note in connection with the proposed IPO of equity shares of the Company.

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

i. Audited Ind AS Financial Statements of the Company as at and for the Year ended March 31, 2024 prepared in accordance with Indian Accounting Standard (Ind AS), as prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules 2015, as amended, and other accounting principles generally accepted in India which have been approved by the Board of Directors at their meeting held on September 12, 2024;

ii. Audited Special Purpose Ind AS Financial Statements of the Company as at and for the year ended March 31 2023 and March 31 2022 prepared in accordance with Indian Accounting Standard (Ind AS) as prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules 2015, as amended, and other accounting principles generally accepted in India which has been approved by the Board of Directors at their meeting held on September 12, 2024; and

iii. The financial statements as at and for the year ended March 31,2024, were the first financials, prepared in accordance with Ind AS. Upto the Financial year ended March 31, 2023, the Company prepared its financial statements in accordance with accounting standards notified under the section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 ("Indian GAAP" or "Previous GAAP") due to which the Special purpose Ind AS financial statements were prepared for the purpose of IPO.

The Special purpose Ind AS financial statements as at and for the year ended March 31, 2023, and March 31, 2022 have been prepared after making suitable adjustments to the accounting heads from their Indian GAAP values following accounting policies and accounting policy choices (both mandatory exceptions and optional exemptions availed as per Ind AS 101) consistent with that used at the date of transition to Ind AS (April 01, 2022) and as per the presentation, accounting policies and grouping/classifications including revised Schedule III disclosures followed as at and for the year ended March 31, 2024.

The financial information for the year ended March 31, 2023 and March 31, 2022 included in this special purpose Ind AS financial statements as mentioned above, are based on the previously issued statutory financial statements prepared for the year ended March 31, 2023 and March 31, 2022 audited and reported by erstwhile statutory auditor A D B & Company, Chartered Accountants, having ICAI firm registration number: 005593C who have issued an unmodified audit opinion vide audit report dated July 28, 2023 and July 30, 2022 respectively .

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

a) Auditors reports issued by us dated September 12, 2024, on the Ind AS financial statements of the Company as at and for the year ended March 31, 2024, as referred in Paragraph 4 (i) above.

b) Auditors report issued by us dated September 12, 2024, on the Special Purpose Ind AS financial statements of the Company as at and for the year ended March 31, 2023 and March31, 2022, as referred in Paragraph 4 (ii) above.

6. The audit reports issued by us referred in paragraph 5 included following matters which did not require any adjustment in the Restated Financial Information:

Report on Other Legal and Regulatory Requirements paragraphs with respect to our audit reports issued by us referred in paragraph 5(a)

Reporting on Audit Trail

Based on our examination which included test checks, the Company, in respect of financial year commencing on April 1, 2023, has used an accounting software for maintaining its books of account which has feature of recording audit trail (edit log) and the same has operated throughout the year for all relevant transactions recorded in the software except that audit trail feature was not enabled at the database level of accounting software to log any direct data changes. Further, during the course of our audit we did not come across any instance of the audit trail feature being tampered with on accounting software where this feature is enabled.(refer note 50 ofthe financial statements).

7. Based on above and according to the information and explanations given to us, we report that:

i. the Restated Financial Statements have been prepared after incorporating adjustments for the changes in accounting policies, any material errors and regrouping/reclassifications retrospectively in the financial years as at and for the year ended March 31, 2023 and March 31, 2022 to reflect the same accounting treatment as per the accounting policies and grouping/classifications followed as at and for the year ended March 31 2024, as more fully described in note no. 51 of the Annexure VI to the Restated Financial Statements.

ii. there are no qualifications in the auditors reports on the Ind AS Financial Statement as at and for the year ended March 31, 2024, and on the special purpose Ind AS Financial Statement for the years ended March 31, 2023, and March 31, 2022, as referred in Para 4 above which requires any adjustments in the Restated financial Statements.

iii. The Restated Financial Statements has been prepared in accordance with the Act, the SEBI ICDR Regulations and the Guidance Note.

8. We have complied with the relevant applicable requirements of the Standard on Quality Control (SQC) 1. Quality Control for firms that perform Audit Reviews of Historical Financial Information and Other Assurance and Related Services Engagements.

9. The Restated Financial Statements do not reflect the effects of events that occurred subsequent to the respective dates of the reports on the audited financial statements mentioned in paragraph 4 above.

10. This report should not in any way be construed as a reissuance 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 herein.

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

12. Our report is intended solely for use of the Board of Directors for inclusion in the DRHP to be filed with SEBI and the Stock exchanges as applicable 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 S S Kothari Mehta & Co. LLP

Chartered Accountants

Firm Registration No. 000756N/ N500441

Vijay Kumar

Partner

Membership No.: 092671 UDIN: 24092671BKFBRZ8974

Place: New Delhi Date: September 28, 2024

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