We have audited the accompanying merged financial statements of ASHAPURA INTIMATES FASHION LIMITED (hereinafter referred to as “the Company”), which comprise the Balance Sheet as at 31st March, 2017, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended, and a summary of the significant accounting policies and other explanatory information, in which have been incorporated in the financial information of erstwhile MOMAI APPARELS LIMITED, now a part of the Company (hereinafter referred to as “erstwhile Momai” or “amalgamating company”) for the year ended on that date, consequent to its amalgamation into the Company , with the appointed date of 1st April, 2016, audited by other auditors, referred in the ‘Other Matter’ section below.

Management’s Responsibility for the Financial Statements

The Company’s Management is responsible for the preparation of these financial statements that give a true and fair view of the Merged financial position, Merged financial performance and Merged cash flows of the Group in accordance with the accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give true and fair view and are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these Merged financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. The Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatements.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments; the auditor considers internal control relevant to the Company’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements

We believe that the audit evidences we have obtained are sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) In the case of the Merged Balance Sheet, of the state of affairs of the Company as at March 31, 2017;

(b) In the case of the Merged Statement of Profit and Loss, of the profit of the Company for the year ended on that date; and

(c) In the case of the Merged Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

Other Matter

The merged financial statements include the financial information of erstwhile Momai Apparels Limited consequent to its amalgamation into the Company, with the appointed date of 1st April 2016. We did not audit the financial information of erstwhile Momai Apparels Limited, included in the merged financial statements of the Company, for the year ended on that date, as considered in the standalone financial statements. This financial information of erstwhile Momai Apparels Limited has been audited by other auditors whose report has been furnished to us and our opinion, in so far as it relates to the amounts and disclosures included in respect of erstwhile Momai Apparels Limited and our report in terms of sub-sections (3) and (11) of Section 143 of the Act, insofar as it relates to erstwhile Momai Apparels Limited is based solely on the report of such other auditors.

Our opinion on the standalone financial statements, and our report on the Other Legal and Regulatory Requirements below, is not modified in respect of the above matter with respect to our reliance on the work done and the report of the other auditors.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”), as amended, issued by the Central Government of India in terms of sub section (11) of section 143 of the Act, we give in the “Annexure A”.

As required by section 143 (3) of the Act, we report to the extent possible 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 purpose of our audit of the aforesaid Merged financial statements

b) In our opinion proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books and the reports of the other auditors

c) The Merged Balance Sheet, the Merged Statement of Profit and Loss and the Merged Cash Flow Statement dealt with by this Report are in agreement with the books of account maintained for the purpose of preparation of the Merged financial statements

d) In our opinion, the aforesaid Merged financial statements comply with the Accounting Standards specified under section 133 of the Act

e) On the basis of written representations received from the directors of the Company as on March 31, 2017 taken on record by the Board of Directors of the company and the reports of the statutory auditors of its other/amalgamting company, none of the directors is disqualified as on March 31, 2017 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”. which is based on the auditors reports of the amalgamated company and the amalgamating company.

g) With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us: the Company and its amalgamating company does not have any pending litigations which would impact its financial position.

As required by the Companies (Auditor’s Report) Order, 2016 (“the Order”), issued by the Central Government in terms of Section 143(11) of the Act, based on our comments and in terms of the comments in the report of the other auditors (amalgamating company auditors) in respect of the amalgamating Company referred in the ‘Other Matter’ section above, we give in the ‘Annexure A’ statement

1. (a) The Company has maintained proper records showing full , including quantitative details and situation of fixed assets;

(b) The Fixed Assets have been physically verified by the management in a phased manner, designed to cover all the items over a period of three years, which in our opinion, is reasonable having regard to the size of the company and nature of its business. Pursuant to the program, a portion of the fixed asset has been physically verified by the management during the year and no material discrepancies between the books records and the physical fixed assets have been noticed.

(c) The title deeds of immovable properties are held in the name of the company.

2. (a) The management has conducted the physical verification of inventory at reasonable intervals.

b) The discrepancies noticed on physical verification of the inventory as compared to books records which has been properly dealt with in the books of account were not material.

3. The Company has not granted any loans, secured or unsecured to companies, firms, Limited Liability partnerships or other parties covered in the Register maintained under section 189 of the Act.

4. In our opinion and according to the information and explanations given to us, the company has complied with the provisions of section 185 and 186 of the Companies Act, 2013 In respect of loans, investments, guarantees, and security.

5. The Company has not accepted any deposits from the public and hence the directives issued by the Reserve Bank of India and the provisions of Sections 73 to 76. or any other relevant provisions of the Act and the Companies (Acceptance of Deposit) Rules, 2015 with regard to the deposits accepted from the public are not applicable.

6. We have broadly reviewed the cost records maintained by the Company pursuant to the Companies ( Cost Records and Audit) Rules, 2014 as amended and prescribed by the Central Government under subsection (1) of Section 148 of the Companies Act, 2013 and are of the opinion that prima fade the prescribed cost records have been made and maintained. We have, however, not made a detailed examination of the cost records with a view to determine whether they are accurate or complete.

7. (a) According to information and explanations given to us and on the basis of our examination of the books of account, and records, the Company has been generally regular in depositing undisputed statutory dues including Provident Fund, Employees State Insurance, Income-Tax, Sales tax, Service Tax, Duty of Customs, Duty of Excise, Value added Tax, Cess and any other statutory dues with the appropriate authorities.

According to the information and explanations given to us, no undisputed amounts payable in respect of the above were in arrears as at March 31, 2017 for a period of more than six months from the date on when they become payable.

(b) According to the information and explanation given to us, there are no dues of income tax, sales tax, service tax, duty of customs, duty of excise, value added tax outstanding on account of any dispute, except given below:

Rs. in Lakhs

8. In our opinion and according to the information and explanations given to us, the Company has not defaulted in the repayment of dues to banks.

9. The Company did not raise any money by way of initial public offer or further public offer (including debt instruments).

10. Based upon the audit procedures performed and the information and explanations given by the management, we report that no fraud by the Company or on the company by its officers or employees has been noticed or reported during the year.

11. Based upon the audit procedures performed and the information and explanations given by the management, the managerial remuneration has been paid or provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Companies Act;

12. In our opinion, the Company is not a Nidhi Company. Therefore, the provisions of clause 4 (xii) of the Order are not applicable to the Company.

13. In our opinion, all transactions with the related parties are in compliance with section 177 and 188 of Companies Act, 2013 and the details have been disclosed in the Financial Statements as required by the applicable accounting standards.

14. According to the information and explanations give to us and based on our examination of the records of the Company, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year.

15. Based upon the audit procedures performed and the information and explanations given by the management, the company has not entered into any non-cash transactions with directors or persons connected with him. Accordingly, the provisions of clause 3 (xv) of the Order are not applicable to the Company and hence not commented upon.

16. In our opinion, the company is not required to be registered under section 45 IA of the Reserve Bank of India Act, 1934 and accordingly, the provisions of clause 3 (xvi) of the Order are not applicable to the Company and hence not commented upon.

For JDNG & ASSOCIATES

CHARTERED ACCOUNTANTS

FRN: 104315W

Place: MUMBAI CA JAYESH S. RAWAL

Date : 29th May, 2017 PARTNER

Membership No: 104738