1. We have audited the accompanying standalone financial
statements of V.I.P. Industries Limited (“the Company”),
which comprise the standalone Balance Sheet as at
March 31, 2026, and the standalone Statement of
Profit and Loss (including Other Comprehensive loss),
the standalone Statement of Changes in Equity and the
standalone Statement of Cash Flows for the year then
ended, and notes to the standalone financial statement,
including material accounting policy information and
other explanatory information.
2. 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 accounting principles generally
accepted in India, of the state of affairs of the Company
as at March 31, 2026, and total comprehensive loss
(comprising of loss and other comprehensive loss),
changes in equity and its cash flows for the year
then ended.
BASIS FOR OPINION
3. 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 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.
KEY AUDIT MATTERS
4. 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.
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Key audit matter
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How our audit addressed the key audit matter
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1. Estimation of rebates, discounts and sales returns
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Our procedures included the following:
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(Refer Note 3(ii), 12B, 21A(b) and 24 to the Standalone
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• Obtained an understanding with regard to controls
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financial statements).
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relating to recording of rebates, discounts, sales returns
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The Company sells its products through various
channels like modern trade, distributors, retailers,
institutions, etc., and recognises liabilities related to
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and the estimation of revenue, period end provisions,
and tested the design and operating effectiveness of
such controls;
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rebates, discounts and right of return.
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• Verified the inputs used in the estimation of revenue
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As per the accounting policy of the Company, the
revenue is recognised upon transfer of control
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(in context of rebates, discounts and sales returns) to
the source data;
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of goods to the customer and thus requires an
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• Assessed the underlying assumptions used for
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estimation of the revenue taking into consideration
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determination of rebates, discount rates, sales returns
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rebates, discounts and right of return as per the
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etc.;
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terms of the contracts.
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• Verified the completeness of liabilities recognised by
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With regard to determination of revenue, the
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evaluating the parameters for a sample of schemes;
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management is required to make significant
estimates in respect of following:
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• Performed analysis for past trends by comparing
recent actuals with the estimates of earlier periods.
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• the rebates/discounts linked to sales, which will
be given to the customers pursuant to schemes
offered by the Company;
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• Tested credit notes issued to customers and payments
made to them during the year and subsequent to the
year-end in along with the terms of the related schemes.
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Key audit matter
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How our audit addressed the key audit matter
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• provision for sales returns, where the customer
has right to return the goods to the Company; and
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• Discounts offered by the distributors to the
customers in accordance with schemes offered
by the Company.
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The matter has been determined to be a key audit
matter in view of the involvement of significant
estimates and judgements made by the management.
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2.
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Assessment of carrying value of investments
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Our procedures included the following:
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in subsidiaries
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• Obtained an understanding from the management,
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(Refer to notes 3(xii), 7 and 8 to the Standalone
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assessed and tested the design and operating
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financial statements).
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effectiveness of the Company's key controls over
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The carrying value of the Company's equity and
preference shares investment in subsidiaries is
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the impairment assessment and fair valuation
of investments.
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' 6.52 Crores and ' 33.42 Crores respectively as at
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• Evaluated the Company's process of impairment
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March 31, 2026.
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assessment and fair valuation by involving
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The Company carries equity investments in
subsidiaries at cost less impairment loss, if any.
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auditor's valuation experts to assist in assessing
the appropriateness of the impairment model,
including independent assessment of the underlying
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The Company has also made investments in
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assumptions like, terminal rate and WACC used by
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preference shares in certain subsidiaries. The
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Management expert.
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Company accounts for these investments in
subsidiaries initially at fair value and subsequently
at fair value through profit and loss.
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• Evaluated the competency, objectivity and capabilities
of management's valuation expert.
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Where an indication of impairment exists, the
carrying value of investment is assessed for
impairment and, where applicable, an impairment
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• Evaluated the cash flow forecasts by comparing them
to the approved budgets and our understanding of the
industry's internal and external factors.
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provision is recognised. The impairment assessment/
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• Checked the mathematical accuracy of the impairment
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fair valuation for such investments has been carried
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model and agreed the relevant data with the latest
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out by the management in accordance with Ind AS
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budgets, past results, and other supporting documents.
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36 and Ind AS 109, as applicable.
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• Assessed the Company's sensitivity analysis and
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Management has made evaluation of impairment
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evaluated whether any reasonably foreseeable change
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loss in the carrying value of investment in
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in assumptions could lead to impairment loss or
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subsidiaries using a discounted cash flow model with
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material change in fair valuation.
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the assistance of valuation experts and concluded
that no impairment loss provision is required against
these investments as at the year end.
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• Evaluated the appropriateness of the disclosures made
in the standalone financial statements.
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We considered this as a key audit matter in our audit
considering that significant management judgement
is involved in assessing the appropriateness of the
valuation model, estimates of future cash flows as
well as assumptions like Weighted Average Cost
of Capital (WACC), growth rate, terminal value, etc.
used in the valuation model.
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3.
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Assessment of recoverability of deferred tax assets
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Our procedures included the following:
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( Refer Note 3(xi), 10 and 40 to the Standalone
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• Obtained an understanding of the processes, evaluated
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financial statements).
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and tested the design and operating effectiveness
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As at the year end March 31, 2026, the Company
has recognised deferred tax assets (‘DTA') of
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of controls over recognition and assessment of
recoverability of DTA.
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' 55.35 Crores (Net) including DTA of ' 27.22 Crores
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• Perused the minutes of meetings to verify that the
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recognised on brought forward business losses and
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business plans used in the assessment and budgets
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unabsorbed depreciation.
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have been approved by the Board of Directors.
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Key audit matter
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How our audit addressed the key audit matter
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The Company assesses its ability to recover the
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• Evaluated the reasonableness of key assumptions and
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DTA at the end of each reporting period based on
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estimates like projected revenue growth and gross
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an assessment of the probability that future taxable
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margins in relation to the probability of generating
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income will be available against which the brought
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future taxable income to support the recognition
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forward tax losses and the unabsorbed depreciation
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of DTA.
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can be set-off.
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• Tested the accuracy and appropriateness of the input
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As per the assessment performed by the Company,
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data used in preparation of the projected future income.
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it expects to earn sufficient taxable profits to set-off
its brought forward tax losses within the permissible
time as per the provisions of the Income-tax Act.
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• Performed sensitivity analysis over key assumptions
to corroborate that the recognised amount of DTA is
within a reasonable range.
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The management's assessment of recoverability
within the time frame permitted under the Income-
tax Act, 1961, involved estimation of the projected
future income and availability of sufficient future
taxable income, which required exercise of significant
management judgment and use of assumptions
relating to revenue growth, gross margins, future
demand in the luggage segment, cost structures and
capacity utilisation.
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• Assessed the adequacy of disclosures made for
compliance with applicable Indian Accounting Standards
and accounting principles generally accepted in India.
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Considering the losses incurred by the Company
in the current and prior year, and significant
management judgment involved in the assessment
of recovery of DTA, this has been considered to be a
key audit matter.
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4. Appropriateness of provision against Inventories
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Our procedures included the following:
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(Refer Note 3(iv) and 13 to the Standalone financial
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• Obtained an understanding of the processes, evaluated
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statements).
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and tested the design and operating effectiveness of
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As at the year end, the Company holds inventories
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controls in respect of provision against Inventory.
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comprising raw materials, finished goods including
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• Obtained an understanding of and evaluated the
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stock-in-trade and work-in-progress etc. aggregating
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appropriateness of the Company's accounting policy
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to ' 355.13 Crores (Net of provisions of ' 106.36
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in line with the applicable accounting standards.
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Crores). In accordance with the requirements of
Ind AS 2 ‘Inventories' and the accounting policy of
the Company, inventory is carried at cost, or net
realisable value (“NRV”), whichever is lower.
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• Evaluated appropriateness of the Management's
process for identification of slow-moving, non¬
moving or obsolete inventories and verified that it is
consistently applied.
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At the end of each reporting period, the Management
of the Company assesses whether there is any
indication of the NRV of any item of inventory is
below the carrying value and whether any provision
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• Assessed the appropriateness of the methodology
adopted and assumptions underlying the management's
assessment of the NRV of inventories.
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is required for inventories identified as slowmoving,
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• Tested ageing of inventory items obtained through
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nonmoving, or obsolete. This assessment involves
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system reports, as applicable.
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significant management judgment in assessing
recoverability, expected future demand and ageing
of the inventory and, consequently, we determined
this area to be a key audit matter.
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• Compared the NRV of finished goods with the carrying
amount on a sample basis, to verify whether any
provision or write down was required.
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• Assessed the adequacy of disclosures made in the
financial statements in line with the applicable Indian
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Accounting Standards.
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OTHER INFORMATION
5. The Company's Board of Directors is responsible for the
other information. The other information comprises
the information included in the Annual report, 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
6. The Company's Board of Directors is 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 Indian 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 statements
that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
7. In preparing the standalone financial statements, 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.
8. Those Board of Directors are also responsible for
overseeing the Company's financial reporting process.
AUDITOR'S RESPONSIBILITIES FOR THE AUDIT
OF THE STANDALONE FINANCIAL STATEMENTS
9. 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.
10. As part of an audit in accordance with SAs, we exercise
professional judgement and maintain professional
scepticism 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 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.
11. 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.
12. 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.
13. 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.
REPORT ON OTHER LEGAL AND REGULATORY
REQUIREMENTS
14. 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 the Annexure B a statement on the
matters specified in paragraphs 3 and 4 of the Order,
to the extent applicable.
15. 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 matters stated in paragraph
15(h)(vi) below on reporting under Rule 11(g) of
the Companies (Audit and Auditors) Rules, 2014
(as amended).
(c) The standalone Balance Sheet, the standalone
Statement of Profit and Loss (including other
comprehensive loss), 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 Indian 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, 2026,
taken on record by the Board of Directors, none of
the directors is disqualified as on March 31, 2026,
from being appointed as a director in terms of
Section 164(2) of the Act.
(f) With respect to the maintenance of accounts and
other matters connected therewith, reference is
made to our remarks in paragraph 15(b) above
and paragraph 15(h)(vi) below.
(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 A”.
(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
(as amended), 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 39 to the standalone
financial statements;
ii. The Company was not required to recognise
a provision as at March 31, 2026 under
the applicable law or Indian Accounting
Standards, as it does not have any material
foreseeable losses on long-term contract.
The Company did not have any long term
derivative contracts as at March 31, 2026.
iii. There has been no delay in transferring
amounts, required to be transferred, to the
Investor Education and Protection Fund by
the Company during the year.
iv. (a) The management has represented that,
to the best of its knowledge and belief,
as disclosed in Note 49 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, whether
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 the Note 49 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, whether 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 such audit procedures that we
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 (a) and (b) contain any
material misstatement.
v. The Company has not declared or paid any
dividend during the year.
vi. Based on our examination, which included
test checks, the Company has used
accounting software for maintaining its
books of account which has a feature of
recording audit trail (edit log) facility and
that has operated throughout the year for
all relevant transactions recorded in the
software, except that the audit trail is not
maintained in case of modification by certain
users with specific access and the audit
trail is not maintained for direct database
changes. During the course of performing
our procedures, other than the aforesaid
instances of audit trail not maintained where
the question of our commenting does not
arise, we did not notice any instance of audit
trail feature being tampered with. Further,
the audit trail has been preserved by the
Company as per the statutory requirements
for record retention. (Refer note 51 to
standalone financial statements).
16. Except for managerial remuneration aggregating to
' 5.32 crores, the managerial remuneration paid/
provided for by the Company is in accordance with the
requisite approvals as mandated by the provisions of
Section 197 read with Schedule V to the Act. As stated
in Note 37 to the standalone financial Statements, the
amount paid/provided by the Company is subject to
approval of the shareholders of the Company by way
of a special resolution in the ensuing annual general
meeting as required by Section 197 read with Schedule
V to the Act.
For Price Waterhouse Chartered Accountants LLP
Firm Registration Number: 012754N/N500016
Alpa Kedia
Partner
Place: Mumbai Membership Number: 100681
Date: May 15, 2026 UDIN: 26100681OUTJWO1648
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