Shayona Engineering Ltd Auditor Reports

To,

The Board of Directors

Shayona Engineering Ltd

(Formerly Known as Shayona Engineering Pvt Ltd.)

113/1 Gidc, Makarpura

Vadodara,

Gujarat - 390010

1. We have examined the attached restated financial information of Shayona Engineering Limited (hereinafter referred to as "the Company") comprising the restated statement of assets and liabilities as at October 31st 2024, March 31st 2024, March 31st 2023, and March 31st 2022 , restated statement of profit and loss and restated cash flow statement for the financial year ended on October 31st 2024, March 31st 2024, March 31st 2023, and March 31st 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 Bombay Stock Exchange of India Limited ("BSE") 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 ("ICDR 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 Draft Red-Herring Prospectus/ Red-Herring Prospectus/ Prospectus ("Offer Document") to be filed with Securities and Exchange Board of India ("SEBI"), BSE and Registrar of Companies -Ahmedabad 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 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 year ended on October 31st 2024, March 31st 2024, March 31st 2023 and March 31st 2022.

6. Audit for the financial statements for the year ended October 31st 2024 was audited by us vide our report dt 30.11.2024, March 31st 2024 was audited by us vide our report dt. 04.06.2024 Audit for the financial year ended March 31st 2023, March 31st 2022 was conducted by us vide report dt. 04.05.2023 and 08.07.2022 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. and accordingly reliance has been placed on the statement of assets and liabilities and statements of profit and loss, the Significant Accounting Policies, and other explanatory information and (collectively, the Audited Financial Statement") examined by them for the said years. The modification in restated financials were carried out based on the modified reports, if any, issued by us which is giving rise to modifications on the financial statements as at and for the period ended on 31st October 2024, 31st March 2024, 31st March, 2023 and 31st March, 2022.

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 year ended on October 31, 2024, March 31, 2024, March 31, 2023, and March 31, 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.

e) Profits and losses have been arrived at after charging all expenses including depreciation and after making such adjustments/restatements and regroupings as in our opinion are appropriate and are to be read in accordance with the Significant Accounting Polices and Notes to Accounts as set out in ANNEXURE IV.

f) Adjustments in Restated Financial Information or Restated Summary Financial Statement have been made in accordance with the correct accounting policies; g) There was no change in accounting policies, which needs to be adjusted in the Restated Financial Information or Restated Summary Financial Statement;

h) The Company has valued its obligations related to Gratuity as per AS -15.

i) The Company has not paid any dividend since its incorporation

8. In accordance with the requirements of the Act including the rules made there under, ICDR Regulations, Guidance Note and engagement letter, we report that:

(i) The "restated statement of asset and liabilities" of the Company as at October 31 2024 March 31, 2024, March 31, 2023, and March 31, 2022 examined by us, as set out in 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 year ended as at October 31, 2024, March 31, 2024, March 31, 2023, and March 31, 2022 examined by us, as set out in Annexure II 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.

(iii) The "restated statement of cash flows" of the Company for the financial year ended as at October 31, 2024, March 31, 2024, March 31, 2023, and March 31, 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-1 to Annexure-XLIV of the restated financial statements that:

"The Company has not accounted for interest provisions as per MSMED Act, 2006 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 contractual credit period and hence, no interest is payable."

Hence, the company has not accounted for interest provisions as per MSMED Act, 2006 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 financial year ended as at October 31st, 2024, March 31st 2024, March 31st 2023, and March 31st 2022 proposed to be included in the Offer Document.

Annexure to Restated Financial Statements of the Company: -

I. Summary statement of assets and liabilities, as restated as appearing in ANNEXURE I;

II. Summary statement of profit 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 Note 1 to this report;

VI. Details of reserves and surplus as restated as appearing in ANNEXURE V Note 2 to this report;

VII. Details of long-term borrowings as restated as appearing in ANNEXURE V Note 3 to this report;

VIII. Details of deferred tax Liabilities (net) as appearing in ANNEXURE V Note 4 to this report;

IX. Details of Short Term and Long Term provisions as restated as appearing in ANNEXURE V Note 5 to this report;

X. Details of short-term borrowings as restated as appearing in ANNEXURE V Note 6 to this report;

XI. Details of trade payables as restated as appearing in ANNEXURE V Note 7 to this report;

XII. Details of other current liabilities as restated as appearing in ANNEXURE V Note 8 to this report;

XIII. Details of property, plant & equipment and intangible assets as appearing in ANNEXURE V Note 9 to this report;

XIV. Details of deferred tax assets (Net) as restated as appearing in ANNEXURE V Note 10 to this report;

XV. Details of inventories as restated as appearing in ANNEXURE V Note 11 to this report;

XVI. Details of trade receivables as restated as appearing in ANNEXURE V Note 12 to this report;

XVII. Details of cash and bank balance as restated as appearing in ANNEXURE V Note 13 to this report;

XVIII. Details of short-term loans and advances as restated as appearing in ANNEXURE V Note 14 to this report;

XIX. Details of other current assets as restated as appearing in ANNEXURE V Note 15 to this report;

XX. Details of Prepaid Expense as restated as appearing in ANNEXURE V Note 16 to this report;

XXI. Details of revenue from operations as restated as appearing in ANNEXURE V Note 17 to this report;

XXII. Details of other income as restated as appearing in ANNEXURE V Note 18 to this report.

XXIII. Details of cost of materials consumed as restated as appearing in ANNEXURE V Note 19 to this report;

XXIV. Details of changes in inventory of finished goods as restated as appearing in ANNEXURE V Note 20 to this report;

XXV. Details of employee benefit expenses as restated as appearing in ANNEXURE V Note 21 to this report;

XXVI. Details of finance cost as restated as appearing in ANNEXURE V Note 22 to this report;

XXVII. Details of depreciation and amortization expenses as restated as appearing in ANNEXURE V Note 23 to this report;

XXVIII. Details of Production Overheads as restated as appearing in ANNEXURE V Note 24i to this report;

XXIX. Details of other expenses as restated as appearing in ANNEXURE V Note 24ii to this report;

XXX. Details of Payment to Auditors as restated as appearing in ANNEXURE V Note 24iii to this report;

XXXI. Details of earning per share (EPS) as restated as appearing in ANNEXURE V Note 25 to this report;

XXXII. Details of contingent liabilities and commitments as restated as appearing in ANNEXURE V Note 26 to this report;

XXXIII. Disclosure under AS-15 as restated as appearing in ANNEXURE V Note 27 to this report;

XXXIV. Details of related party transaction as restated as appearing in ANNEXURE V Note 28 to this report;

XXXV. Summary of significant accounting ratios as restated as appearing in ANNEXURE V Note 29 to this report;

XXXVI. Details of expenditure in foreign currency during the financial year as restated as appearing in ANNEXURE V Note 30 to this report;

XXXVII. Details of earnings in foreign exchange as restated as appearing in ANNEXURE V Note 31 to this report;

XXXVIII. Details of dues of small enterprises and micro enterprises as restated as appearing in ANNEXURE V - 32 to this report;

XXXIX. Restated statement of Reserves and surplus as restated as appearing in ANNEXURE VI to this report;

XL. Restated statement of Borrowings as restated as appearing in ANNEXURE VII to this report;

XLI. Restated statement of other liabilities and provisions as appearing in ANNEXURE VIII to this report;

XLII. Restated statement of trade receivables as appearing in ANNEXURE IX to this report;

XLIII. Restated statement of other assets as appearing in ANNEXURE X to this report;

XLIV. Restated statement of other income as appearing in ANNEXURE XI to this report;

XLV. Restated statement of Accounting ratios as appearing in ANNEXURE XII to this report;

XLVI. Restated statement of Capitalisation as appearing in ANNEXURE XIII to this report;

XLVII. Statement of tax shelters as restated as appearing in ANNEXURE XIV to this report;

XLVIII. Reconciliation of Restatement Adjustments as appearing in ANNEXURE XV to this report;

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 report 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.

12. 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 (Ahmedabad) 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 SGPS & Associates
	(Chartered Accountants)
	Reg No. 0132946W
Date: 05.12.2024	Viren Ashwinbhai Gandhi
Place: Vadodara	Partner
	M.No. 147119
	UDIN: 24147119BKBLBI2698