We have audited the accompanying standalone financial
statements of Kitex Garments Limited ("the Company”), which
comprise the Balance Sheet as at March 31, 2025, and the
Statement of Profit and Loss, including Other Comprehensive
Income, Statement of Changes in Equity and Statement of Cash
Flows for the year then ended, and notes to the standalone
financial statements, including material accounting policy
information and other explanatory information (hereinafter
referred to as the "standalone financial statements”).

In our opinion and to the best of our information and according
to the explanations given to us, except for the effects of the
matters described in the Basis for Qualified opinion section of
our report, 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 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 March 31, 2025, and profit
and other comprehensive loss, changes in equity and its cash
flows for the year ended on that date.

Basis for Qualified Opinion

The Company has an investment in Kitex USA LLC, an Associate
Company amounting to Rs 2,776.24 lakhs (March 31,2024:
Rs 2,776.24 lakhs), which is incurring losses and this has
fully eroded its net worth as on that date. The Company also
has trade receivables amounting to to Rs.12,277.57 lakhs
as at March 31, 2025 (March 31, 2024: Rs.10,225.12 lakhs)
due from the aforesaid Associate. The management of the
Company has determined the carrying value of investment and
outstanding trade receivables from the said Associate as good
and recoverable based on valuations performed and future
projected cash flows, considering proposed changes in the
business plan, forecasted future revenue growth and increased
margin contributions. For the year ended March 31, 2025, the
management of the Company has not been able to provide
corroborative evidence to substantiate the reasonableness of
the above-mentioned unobservable inputs. Accordingly, we are
unable to comment on the recoverability of the carrying value
of the investment in Kitex USA, LLC and Trade Receivables due
from Kitex USA, LLC as at March 31, 2025. (Refer Note 2.02.1 to
the standalone financial Statements).

This matter was also qualified in our report on the standalone
financial statements for the year ended March 31, 2024.

We conducted our audit of the standalone financial statements
in accordance with the Standards on Auditing (SAs) specified
under section 143(10) of the Act. Our responsibilities under
those Standards are further described in the 'Auditor’s
Responsibilities for the Audit of the Standalone Financial
Statements’ 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
standalone 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 obtained
by us is sufficient and appropriate to provide a basis for our
qualified opinion.

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 for the year ended March
31, 2025 (current year). 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. In addition to the
matter described in the Basis for Qualified Opinion section we
have determined the matters described below to be the key audit
matters to be communicated in our report.

Valuation of Inventory

Refer to Note 2.07 to Standalone financial statements.

The total value of inventory as of March 31, 2025, amounted
to Rs. 18,949.15 lakhs representing 13.59% of the total
assets (March 31, 2024: 16,409.16 Lakhs, 14.32% of the total
assets). Inventories are measured the lower of cost and net
realisable value.

The Company is an apparel manufacturer and exporter of knitted
garments for infants and kids.

The valuation of raw material, semi-finished and finished
goods is a comprehensive exercise and is carried out manually.
Allocation of indirect production costs is also estimated and
loaded as inventory cost, as part of the valuation exercise.
This allocation requires judgment and estimation, which are
uncertain at the time of such estimation.

Management also applies judgement in identification &
determination of obsolete inventories and slow-moving items
of stocks and estimates the appropriateness of requisite
provisions thereon. On account of the subjective judgment
and uncertainties involved above, we considered this as a
Key Audit Matter.

We have performed the following audit procedures in relation to
Inventory valuation:

• Assessed the accounting policies relating to valuation of
Inventory in compliance with Ind AS 2 ("Inventories”).

• Assessed the management process of inventory valuation
including allocation of overheads to inventory.

• Evaluated the design and implementation and tested
the operative effectiveness of relevant internal controls
pertaining to valuation of inventory, including the process
for write-down of obsolete inventory and the manual
inventorisation of indirect production costs.

• Assessed the adequacy and appropriateness of write¬
downs for excess and/or obsolete inventory in relation
to the future demand data, historical usage, historical
accuracy of write-downs and management's plans to
utilise the inventory.

• Evaluated the significant judgements and estimates
made by Management in applying Company's accounting
policy in relation to the manual inventorisation of indirect
production costs.

• Assessed the adequacy and accuracy of disclosures
in the standalone financial statements with respect to
inventory in accordance with respective accounting
standards and framework.

Information Other than the Standalone Financial
Statements and Auditor's Report Thereon

The Company's Board of Directors is responsible for the other
information. The other information comprises the Director's
report along with annexures but does not include the standalone
financial statements and our auditor's 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 standalone financial
statements, our responsibility is to read the other information
and, in doing so, consider whether the other information is
materially inconsistent with the standalone financial statements
or our knowledge obtained in the 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

Responsibilities of Management and Those Charged
with Governance for the Standalone Financial
Statements

The Company's management and Board of Directors are
responsible for the matters stated in section 134(5) of the Act
with respect to the preparation of these standalone financial
statements that give a true and fair view of the financial position,
financial performance, changes in equity and cash flows of the
Company in accordance with the accounting principles generally
accepted in India, including the Accounting Standards 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 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 standalone financial statement that give a true and fair
view and are free from material misstatement, whether due to
fraud or error.

In preparing the standalone financial statements, the
Management and Board of Directors are responsible for
assessing the Company's ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and
using the going concern basis of accounting unless the Board
of Directors either intends to liquidate the Company or to cease
operations, or has no realistic alternative but to do so.

The Board of Directors are also responsible for overseeing the
Company's financial reporting process.

Auditors' Responsibilities for the Audit of the
Standalone Financial Statements

Our objectives are to obtain reasonable assurance about
whether the standalone financial statements as a whole are free
from material misstatement, whether due to fraud or error, and to
issue an auditor's 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
standalone financial statements.

We give in "Annexure A” a detailed description of Auditor's
responsibilities for Audit of the Standalone Financial Statements.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order,
2020 ("the Order”), issued by the Central Government of
India in terms of sub-section (11) of section 143 of the
Act, we give in "Annexure B” a statement on the matters
specified in paragraphs 3 and 4 of the Order, to the
extent applicable.

2. As required by Section 143(3) of the Act, we report that:

a. We have sought and except, for the possible effect of
the matter described in the Basis for Qualified Opinion
above, obtained all the information and explanations
which to the best of our knowledge and belief were
necessary for the purposes of our audit.

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 except
for the matters stated in the paragraph 2(h)(vi) below
on reporting under Rule 11(g)

c. The Balance Sheet, the Statement of Profit and Loss
including other comprehensive income, the Statement
of Changes in Equity and the Statement of Cash Flow
dealt with by this Report are in agreement with the
books of account.

d. Except, for the matter described in the Basis of
Qualified Opinion section above, in our opinion, the
aforesaid standalone financial statements comply
with the Accounting Standards specified under
Section 133 of the Act.

e. On the basis of the written representations received
from the directors as on March 31,2025 taken on record
by the Board of Directors, none of the directors are
disqualified as on March 31, 2025 from being appointed
as a director in terms of Section 164 (2) of the Act.

f. The reservation relating to the maintenance of
accounts and other matters connected therewith are
as stated in Basis for Qualified opinion, paragraph
2(b) above on reporting under Section 143(3)(b) and
paragraph 2(h)(vi) below on reporting under Rule 11(g).

g. With respect to the adequacy of the internal financial
controls with reference to standalone financial
statements of the Company and the operating
effectiveness of such controls, refer to our separate
Report in "Annexure C”.

h. 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:

i. The Company has disclosed the impact of
pending litigations on its financial position in
its standalone financial statements. Refer Note
2.41.1 of 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. There has been no delay in transferring amounts,
required to be transferred, to the Investor
Education and Protection Fund by the Company.

iv. (1) The Management has represented that,

to the best of its knowledge and belief,
as disclosed in the Note 2.46 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(s) or entity(ies), including
foreign entities ("Intermediaries”), with
the understanding, whether recorded in
writing or otherwise, that the Intermediary
shall, 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.

(2) The Management has represented, that,
to the best of its knowledge and belief,
as disclosed in the Note 2.46 to the
standalone financial statements, no funds
have been received by the Company from
any person(s) or entity(ies), including
foreign entities ("Funding Parties”), with
the understanding, whether recorded in
writing or otherwise, that the Company
shall, 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.

(3) Based on the audit procedures performed
that have been considered reasonable
and appropriate in the circumstances,
and according to the information and
explanations provided to us by the
Management in this regard nothing has
come to our notice that has caused us
to believe that the representations under
sub-clause (i) and (ii) of Rule 11(e) as
provided under (1) and (2) above, contain
any material mis-statement

v. The final dividend paid by the Company during
the year in respect of the same declared for
the previous year is in accordance with section
123 of the Companies Act 2013 to the extent it
applies to payment of dividend.

the year as explained in Note 2.47 to the
financial statements

Further, during the course of our audit, except for
the above, we did not come across any instance
of audit trail feature being tampered.

Additionally, the audit trail of prior years has been
preserved by the Company as per the statutory
requirements for record retention to the extent it
was enabled and recorded in prior year.

3. In our opinion, according to information, explanations given
to us, the remuneration paid by the Company to its directors
is within the limits laid prescribed under Section 197 read
with Schedule V of the Act and the rules thereunder.

For M S K A & Associates

Chartered Accountants
ICAI Firm Registration No. 105047W

Geetha Jeyakumar

Partner

Place: Chennai Membership No. 029409

Date: June 23, 2025 UDIN: 25029409BMMIRA2307