We have audited the standalone financial statements of
Paradeep Phosphates Limited (the "Company”) which
comprise the standalone balance sheet as at 31 March 2026,
and the standalone statement of profit and loss (including
other comprehensive income), standalone statement of
changes in equity and standalone statement of cash flows
for the year then ended, and notes to the standalone financial
statements, including material accounting policies and other
explanatory information.

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 ("Act”) in the manner so required and give a true and fair view
in conformity with the accounting principles generally accepted
in India, of the state of affairs of the Company as at 31 March
2026, and its profit and 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 SAs 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 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 we have

obtained is sufficient and appropriate to provide a basis for our
opinion on the standalone financial statements.

Emphasis of Matter

a. We draw attention to Note 44(a) to the standalone financial
statements which describes the overall accounting for and in
particular basis for restatement of the comparatives for the
year ended 31 March 2025 by the Company’s management
consequent to the Scheme of arrangement ('Scheme’) for
amalgamation of MCFL with the Company. The Scheme has
been approved by the NCLT vide its order dated 26 September
2025 with appointed date of 01 April 2024 and a certified
copy has been filed by the Company with the Registrar of
Companies, Odisha and Karnataka, on 16 October 2025.
We further draw attention to the fact that in accordance
with the Scheme approved by the NCLT, the Company has
given effect to the Scheme from the retrospective appointed
date specified therein i.e. 01 April 2024 which overrides the
relevant requirement of Ind AS 103 "Business Combinations”
(according to which the Scheme would have been accounted
for from 16 October 2025 which is the date of acquisition
as per the aforesaid standard). The financial impact of the
aforesaid treatment has been disclosed in the aforesaid note.

Our opinion is not modified in respect of this matter.

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 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.

Recognition of subsidy revenue

See Note 20 to standalone financial statements

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

The Company’s Management and Board of Directors are
responsible for the other information. The other information
comprises the information included in the Company’s directors'
report, but does not include the financial statements and
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.

Management's and Board of Directors' Responsibilities
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 state of affairs,
profit/ loss and other comprehensive income, changes in
equity and cash flows of the Company in accordance with the
accounting principles generally accepted in India, including the
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
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
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 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 control 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 with reference to 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 the Management and Board of Directors.

• Conclude on the appropriateness of the Management
and Board of Directors use of the going concern basis of
accounting in preparation of standalone financial statements
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

a. The corresponding amounts for the year ended 31 March
2025, in so far it pertains to the transferor company, which
has been accounted as stated in Note 44(a), are based on
the audited financial statements of the transferor Company
(prior to recognition of adjustments in accordance with
requirements of Ind AS 103 "Business Combinations",
which have been audited by us) for the year ended 31
March 2025 that were audited by another auditor who had
expressed an unmodified opinion on 7 May 2025. Further,
the adjustments for the accounting effects of the Scheme
have been audited by us.

Our opinion is not modified in respect of this matter.

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 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 A. As required by Section 143(3) of the Act, 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 matter stated in the paragraph 2B(f) below on
reporting under Rule 11(g) of the Companies (Audit
and Auditors) Rules, 2014.

c. The standalone balance sheet, the standalone
statement of profit and loss (including other

comprehensive income), the standalone statement
of changes in equity and the standalone statement of
cash flows dealt with by this Report are in agreement
with the books of account.

d. In our opinion, the aforesaid standalone financial
statements comply with the Ind AS specified under
Section 133 of the Act.

e. On the basis of the written representations received
from the directors as on 31 March 2026 and 1 April
2026 taken on record by the Board of Directors, none
of the directors is disqualified as on 31 March 2026
from being appointed as a director in terms of Section
164(2) of the Act.

f. the modification relating to the maintenance of
accounts and other matters connected therewith are
as stated in the paragraph 2A(b) above on reporting
under Section 143(3)(b) of the Act and paragraph
2B(f) below on reporting under Rule 11(g) of the
Companies (Audit and Auditors) Rules, 2014.

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

B. 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:

a. The Company has disclosed the impact of pending
litigations as at 31 March 2026 on its financial
position in its standalone financial statements - Refer
Note 29 to the standalone financial statements.

b. The Company did not have any long-term contracts
including derivative contracts for which there were
any material foreseeable losses.

c. There were no amounts which were required to be
transferred to the Investor Education and Protection
Fund by the Company.

d. (i) The management has represented that, to the best

of its knowledge and belief, as disclosed in the
Note 43(b) 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.

(ii) The management has represented that, to the
best of its knowledge and belief, as disclosed
in the Note 43(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
Parties ("Ultimate Beneficiaries”) or provide any
guarantee, security or the like on behalf of the
Ultimate Beneficiaries.

(iii) Based on the audit procedures 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 (i) and (ii) of
Rule 11(e), as provided under (i) and (ii) above,
contain any material misstatement.

e. 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 Act to
the extent it applies to payment of dividend.

As stated in Note 13 to the standalone financial
statements, the Board of Directors of the

Company has proposed final dividend for the year
which is subject to the approval of the members at
the 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.

f. Based on our examination which included test
checks, the Company has used an accounting
software for maintaining its books of account which

has a feature of recording audit trail (edit log) facility
except that that audit trail was not enabled at the
database level for accounting software to log any
direct data changes. For accounting software for
which audit trail feature is enabled, the audit trail
facility has been operating throughout the year for all
relevant transactions recorded in the software and
we did not come across any instance of audit trail
feature being tampered with during the course of our
audit. Additionally, where audit trail (edit log) facility
was enabled and operated in previous years, the audit
trail has been preserved by the Company as per the
statutory requirements for record retention.

C. With respect to the matter to be included in the Auditor’s
Report under Section 197(16) of the Act:

In our opinion and according to the information and
explanations given to us, the remuneration paid by the
Company to its directors during the current year is in
accordance with the provisions of Section 197 of the Act.
The remuneration paid to any director is not in excess
of the limit laid down under Section 197 of the Act. The
Ministry of Corporate Affairs has not prescribed other
details under Section 197(16) of the Act which are required
to be commented upon by us.

For B S R & Co. LLP

Chartered Accountants

Firm’s Registration No.:101248W/W-100022

Jayanta Mukhopadhyay

Partner

Membership No.: 055757

ICAI UDIN:26055757JQPPGB9606

Place: Bengaluru

Date: 11 May 2026