We have audited the accompanying Standalone Financial
Statements of NMDC Limited (hereinafter referred to as "the
Company"), which comprise the Balance Sheet as at March
31, 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 then ended, and notes
to the 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, 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, ("Ind AS") and other
accounting principles generally accepted in India, of the state of
affairs of the Company as at March 31, 2026, its profit (including
other 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)" 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 made thereunder, and we have fulfilled our other
ethical responsibilities in accordance with these requirements
and the ICAI's Code of Ethics. We believe that the audit evidence
obtained by us and the branch auditors in terms of their report
referred to in "Other Matter" paragraph below, is sufficient and
appropriate to provide a basis for our opinion on the Standalone
Financial Statements.

Key Audit Matters

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

Emphasis of Matter

We draw attention to the following matters forming part of the
Standalone Financial Statements

a. Note No. 2.48 (A.1.3.1) regarding the Karnataka (Mineral
Rights and Mineral Bearing Land) Tax Bill, 2024 proposing
retrospective levy of taxes, which is pending the assent of
the Hon'ble President of India. Considering the current status,
the estimated amount of ' 15,481.72 crores, if enacted in its
current form, has been considered as contingent liability.

b. Note No. 2.49.4(vi) regarding recoverability of dues from
NMDC Steel Limited (NSL), representing an amount of '
1,851.39 crores arising from demerger and ' 4,839.36 crores
of trade and other receivables.

c. Note No. 2.51.8(a) regarding recoverability of trade receivables
from Rashtriya Ispat Nigam Limited (RINL) amounting to '
4,586.31 crores.

d. Note No. 2.49.4(iv) regarding status of advance of ' 639.61
crores paid by the Company to Karnataka Industrial Areas
Development Board (KIADB) towards cost of land allotted
to its wholly owned subsidiary, Karnataka Vijayanagar Steel
Limited (KVSL).

e. Note No. 2.48 (A.1.3.2) regarding demand of ' 1,623.44
crores relating to compensation based on common cause
judgement, which is sub-judice.

f. Note No. 2.48 (A.1.3.3) regarding order/ notice alleging
mineral dispatches without timely Railway Transit Passes

(RTP), resulting in a penalty of ' 1,620.50 crores which is sub-
judice.

g. Note No. 2.49.4(xi) regarding financial position of Legacy Iron
Ore Ltd, a foreign subsidiary of the Company.

The impact of the above on the Standalone Financial Statements
is dependent on the outcome of the proceedings/ matters as
described in the said notes.

Our opinion is not modified in respect of the above matters.

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 information
included in the Annual report namely Management Discussion and
Analysis, Board's Report including Annexures to Board's Report,
Business Responsibility and Sustainability Report, Corporate
Governance Report and Shareholder Information (collectively
called as "Other Information"), but does not include the Standalone
Financial Statements and our auditor's report thereon. The Other
information as above is expected to be made available to us after
the date of this auditor's report.

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 identified above
when it becomes available and, in doing so, consider whether the
other information is materially inconsistent with the Standalone
Financial Statements or our knowledge obtained during the course
of our audit or otherwise appears to be materially misstated.

When we read the other information, if we conclude that there is
a material misstatement therein, we are required to communicate
the matter to those charged with governance and take appropriate
actions, as applicable under the relevant laws and regulations, if
required.

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

The Company's Board of Directors is responsible for the matters
specified in section 134(5) of the Act with respect to the preparation
and presentation of these Standalone Financial Statements

that give a true and fair view of the financial position, financial
performance, other comprehensive income, changes in equity
and cash flows of the Company in accordance with accounting
principles generally accepted in India, including Indian Accounting
Standards (Ind 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 Standalone Financial
Statements 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 Board of
Directors is 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 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 is also responsible for overseeing the
Company's financial reporting process.

Auditor's 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.

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 Standalone 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 financial controls relevant
to the audit in order to design audit procedures that are
appropriate in the circumstances. Under section 143(3)(i) of
the Act, we are also responsible for expressing our opinion on
whether the Company has adequate internal financial controls
system with reference to Standalone Financial Statements 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 management's 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 Company's ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to
draw attention in our auditor's report to the related disclosures
in the Standalone 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
auditor's 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
Standalone Financial Statements, including the disclosures,
and whether the Standalone Financial Statements represent
the underlying transactions and events in a manner that
achieves fair presentation.

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 Standalone Financial Statements

of the current period and are therefore the key audit matters.
We describe these matters in our auditor's 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.

Other Matter

We did not audit the financial statements of six branches included
in the audited Standalone Financial Statements of the Company,
whose financial statements reflects total assets of ' 27,867.81
crores as at March 31, 2026; total revenues of ' 28,092.06 crores
and total net profit before tax of ' 9,450.90 crores, for the year
ended March 31, 2026 as considered from the respective audited
financial statements of the Branches included in the Standalone
Financial Statements of the Company. The financial statements of
these branches have been audited by the respective independent
branch auditors whose reports have been furnished to us, and
our opinion in so far as it relates to the amounts and disclosures
included in respect of these branches, is based solely on the report
of such branch auditors and the procedures performed by us are
as stated under "Auditor's Responsibilities for the Audit of the
Standalone Financial Statements" section above after considering
the requirements of Standard on Auditing (SA 600) on "Using the
work of Another Auditor" including materiality.

Our opinion is not modified in respect of the above matter.

Report on Other Legal and Regulatory
Requirements

1. Based on our audit and on the consideration of report of
Branch Auditors as mentioned in the Other Matter paragraph,
as required by the Companies (Auditor's Report) Order, 2020
("the Order") issued by the Central Government of India in
terms of Section 143(11) of the Act, we give in the "Annexure
A" 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, based on our audit
and on the consideration of report of Branch Auditors as
mentioned in the Other Matter paragraph, 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;

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(j)(vi) below on reporting under
Rule11(g) of the Companies (Audit and Auditor's) Rules,
2014, as amended;

c) The reports on the accounts of the branch offices of
the Company audited under Section 143(8) of the Act
by branch auditors have been sent to us and have been
properly dealt with by us in preparing this report;

d) The Balance Sheet, the Statement of Profit and Loss
(including other comprehensive income), the Statement
of Changes in Equity and the Statement of Cash Flows
dealt with by this Report are in agreement with the books
of account and other records maintained for the purpose
of preparation of the Standalone Financial Statements;

e) In our opinion, the aforesaid Standalone Financial
Statements comply with the Indian Accounting
Standards ("Ind AS") specified under Section 133 of the
Act;

f) The provisions of Section 164(2) of the Act, in respect
of disqualification of directors are not applicable to
the company, being a Government company in terms
of notification no: - G.S.R.463(E) dated 5th June 2015
issued by Ministry of Corporate Affairs, Government of
India.

g) The modifications relating to the maintenance of
accounts and other matters connected therewith are as
stated in the paragraph 2(b) above on reporting under
Section 143(3)(b) of the Act and paragraph 2(j)(vi) below
on reporting under Rule 11(g) of the Companies (Audit
and Auditor's) Rules, 2014, as amended.

h) 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 -B". Our report expresses a
modified opinion on the operating effectiveness of the
Company's internal financial controls with reference to
the standalone financial statements.

i) With respect to the other matters to be included in the
auditor's report in accordance with the requirements of
Section 197(16) of the Act, as amended:

We are informed that the provisions of section 197
read with Schedule V of the Act, relating to managerial
remuneration are not applicable to the company, being a
Government Company, in terms of Ministry of Corporate
Affairs notification no- G.S.R.463(E) 5th June 2015.

) With respect to the other matters to be included in
the Auditor's Report in accordance with Rule 11 of the
Companies (Audit and Auditor's) 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 Note 2.48(A) to
the Standalone Financial Statements.

ii. The company does 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
and related equity shares, that are required to be
transferred, to the Investor Education and Protection
Fund by the company.

iv. a. The management has represented that, to the

best of its knowledge and belief, as disclosed
in Note 2.51.12(a) 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.

b. The management has represented, that, to the
best of its knowledge and belief, as disclosed
in Note 2.51.12(b) 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;
and

c. Based on the audit procedures performed by
us 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 (iv)(a) and (iv)(b) contain any material
misstatement.

v. The interim dividend declared and paid by the
company during the year and until the date of this
audit report is in accordance with section 123 of the
Act.

The final dividend paid by the Company during
the financial year 2025-26 which was declared for
the previous financial year 2024-25 and approved
by the members at Annual General Meeting is
in accordance with section 123 of the Act, to the
extent it applies to payment of dividend.

As stated in note 2.52.3(b) to the Standalone
Financial Statements, the Board of Directors of
the Company has recommended Final dividend
for the year which is subject to the approval of the
members at ensuing Annual General Meeting. The
dividend declared is in accordance with section 123
of the Act to the extent it applies to declaration of
dividend.

vi. Based on our examination which included test
checks and the report of the auditors of the six
branches and according to the information and
explanations given to us and as stated in Note No.
2.51.13 to the Standalone Financial Statements,
the Company has used the accounting software
for maintaining its books of account which has a
feature of audit trail (edit log) facility and the same
has operated throughout the year for all the relevant

transactions recorded in such software except that:

a. The feature of recording audit trail (edit log)
facility was not enabled at the database level to
log any direct data changes for the accounting
software used for maintaining the books of
account.

b. The feature of recording audit trail (edit log)
facility was not enabled at the application level
on two additional application servers deployed
during the year on May 21, 2025. The audit trail
feature was enabled on January 11, 2026 and
has been operational thereafter. The audit trail
(edit log) feature was not enabled for certain
custom (Z) tables within the accounting
software which was enabled subsequent to the
year-end on April 23, 2026.

During the course of our audit, we did not come across any
instance of audit trail feature being tampered with and the audit
trail has been preserved by the Company as per the statutory
requirements for record retention.

3. We are enclosing our report in terms of section 143(5) of the
Act, on the basis of such checks of the books and records
of the Company as we consider appropriate and the report
of the auditors of the six branches and according to the
information and explanations given to us, in the "Annexure-C"
on the directions issued by the Comptroller & Auditor General
of India.

For VARMA & VARMA

Chartered Accountants
FRN 004532S

K P SRINIVAS

Place: New Delhi Partner

Date: May 29, 2026 M No. 208520

UDIN: 26208520HWAQZX4350