We have audited the Standalone Financial Statements of Zuari Agro
Chemicals Limited ("the Company"), which comprise the Balance
Sheet as at March 31, 2026, the Statement of Profit and Loss
including the statement of other comprehensive income, the
Statement of Cash Flows and the Statement of changes in Equity
for the year then ended, and Notes to the Standalone Financial
Statements, including a Summary of significant 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, as amended ("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, its profit including other comprehensive income
and its cash flows and the changes in equity for the year ended on
that date.
Basis for Opinion
We conducted our audit of the Standalone Financial Statements in
accordance with the Standards on Auditing (SAs) as specified under
section 143(10) of the Companies Act, 2013. 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
there-under, 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 we have obtained is sufficient
and appropriate to provide a basis for our audit 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 for the financial year ended 31st March, 2026.
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.
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Key Audit Matter
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How our audit addressed the key audit matter
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Assessment of Going Concern Basis (As described in Note 49 of the
financial statement)
Zuari Agro Chemicals Limited ("the Company") has ceased its primary
business operations during the year under audit. The Company
currently has no revenue from operations and is in the process of
evaluating and pursuing new business opportunities, including
strategic diversification into mining activities.
In pursuance thereof, the Company has altered its object clause to
enable it to explore mining and associated activities, and has
evaluated making a bid for the auction of Iron Ore blocks in Goa.
The Company's net worth as on 31st March 2026 stands at ' 632
crores. The Company holds significant immovable properties
(including land parcels carried at nominal book value but having
substantial realisable market value), strategic financial investments,
and other assets, the aggregate realisable value of which is
considered by management to be significantly higher than the
Company's existing liabilities.
Management has concluded, and represented to us, that there exists
no material uncertainty that would cast significant doubt on the
Company's ability to continue as a going concern. Accordingly, the
financial statements have been prepared on a going concern basis.
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Our audit procedures in respect of the going concern assessment
included, but were not limited to, the following:
• Obtained and reviewed management's written going concern
assessment and representation letter, setting out the factors
supporting the appropriateness of the going concern
assumption.
• Evaluated the reasonableness of management's assessment
against the financial position of the Company as at 31st
March 2026, including a review of the net worth of ' 632
crores, the composition of assets, and the nature and
quantum of existing liabilities.
• Verified the carrying value of significant immovable
properties and financial investments in the books of account
and assessed whether management's assertion regarding
their realisable market value is supported by available
evidence, including independent valuations or market data
where available.
• Reviewed the Company's Memorandum of Association to
verify that the object clause has been duly amended to
include mining and associated activities, as represented by
management.
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Key Audit Matter
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How our audit addressed the key audit matter
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We have identified the assessment of the appropriateness of the
going concern assumption as a Key Audit Matter, given:
• The absence of revenue from operations during the year, which
is a significant indicator requiring careful evaluation under SA
570 (Revised), Going Concern;
• The Company's reliance on asset monetisation, strategic investors,
and new business development to sustain operations and meet
financial obligations; and
• The inherent uncertainty associated with the outcome of
exploratory business initiatives, including the proposed foray into
mining activities, which are subject to regulatory approvals,
competitive bidding outcomes, and market conditions — all
outside the control of management.
Given the significance of the judgements involved in management's
going concern assessment, and the potential impact on the financial
statements if these judgements were to change, we have determined
this matter to be of most significance in our audit of the financial
statements for the year ended 31st March 2026.
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• Assessed the Company's ability to meet its financial
obligations as they fall due by reviewing the maturity profile
of liabilities, the liquidity position, and available
unencumbered assets that can be monetised if required.
• Reviewed correspondence with lenders, bankers, and key
stakeholders, where available, to assess the Company's
ongoing ability to raise finance and maintain financial
relationships.
• Assessed whether the disclosures made in the financial
statements in respect of the going concern assumption are
adequate and in accordance with the requirements of Ind
AS 1 — Presentation of Financial Statements. (Refer Note 49
to the financial statements)
• Based on the audit procedures performed, we concur with
management's assessment that the going concern
assumption is appropriate in the preparation of the financial
statements of the Company for the year ended 31st March
2026. We did not identify evidence of a material uncertainty
that would cast significant doubt on the Company's ability
to continue as a going concern. Accordingly, no modification
to our opinion is required in this regard
This Key Audit Matter has been identified in accordance with
SA 701, Communicating Key Audit Matters in the Independent
Auditor's Report. Since management has concluded that no
material uncertainty exists as at 31st March 2026, no
Emphasis of Matter paragraph under SA 706 is required.
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Estimates with respect to recognition of deferred tax assets on
unused tax losses.
For the year ended 31st March, 2026, the company has not recognized
deferred tax income/expense in the Standalone financial statements
on unused tax losses
Deferred tax assets are recognized on unabsorbed tax losses when it
is probable that taxable profit will be available against which such
tax losses can be utilized. The Company's ability to recognize deferred
tax assets on unabsorbed tax losses is assessed by the management
at the end of each reporting period, taking into account forecasts of
future taxable profits and the assumptions on which such projections
are determined by the management.
Given the degree of estimation based on the projection of future
taxable profits, management's decision to not create deferred tax
assets on unabsorbed tax losses has been identified to be a key audit
matter.
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Our audit procedures included among the others, the following:
• Gained an understanding of the deferred tax assessment
process and assessed the design and tested the operating
effectiveness of controls over recognition of deferred tax.
• Discussed and evaluated management's assumptions and
estimates like projected revenue growth, margins, etc. in
relation to the probability of generating future taxable
income to support the utilization of deferred tax on
unabsorbed tax losses with reference to forecast taxable
income and performed sensitivity analysis.
• Tested the arithmetical accuracy of the model.
• Assessed the related disclosures in respect of the deferred
tax assets in the Standalone financial statements.
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Other Information
The Company's Board of Directors is responsible for the preparation
of the other information. The other information comprises the
information included in the Annual Report, but does not include
the Standalone Financial Statements and Auditor's Report thereon.
The company's annual report 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 and, in doing so,
consider whether such 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.
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 for the Standalone Financial
Statements
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 including other
comprehensive income, cash flows and changes in equity 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 judgements 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 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, management 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 management
either intends to liquidate the Company or to cease operations, or
has no realistic alternative but to do so.
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
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
judgement 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 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.
Materiality is the magnitude of misstatements in the Standalone
Financial Statements that, individually or in aggregate, makes
it probable that the economic decisions of a reasonably
knowledgeable user of the Standalone Financial Statements
may be influenced. We consider quantitative materiality and
qualitative factors in (i) planning the scope of our audit work
and in evaluating the results of our work; and (ii) to evaluate
the effect of any identified misstatements in the Standalone
Financial Statements.
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.
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 Companies Act,
2013, we give in the "Annexure 1", a statement on the matters
specified in paragraphs 3 and 4 of the said Order, to the extent
applicable.
2. 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.
c. The Balance Sheet, the Statement of Profit and Loss
including statement of other Comprehensive Income, Cash
Flow Statement and Statement of Changes in Equity 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 Accounting Standards
specified under Section 133 of the Act, read with
Companies (Indian Accounting Standards) Rules, 2015.
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 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 2" to this report.
g. 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
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 me/us:
i. The Company has disclosed the impact of pending
litigations on its financial position in its Standalone
Financial Statements refer note 32 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 was no amount required to be transferred to
the Investor Education and Protection Fund by the
Company during the year ended March 31, 2026.
iv. a) The management has represented that, to the
best of its knowledge and belief, as disclosed in
the Note 52(v) 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 or entity, 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 52 (vi) to the standalone financial
statements, no funds have been received by the
Company from any person or entity, 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;
c) Based on such audit procedures performed 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 (a) and
(b) of clause iv above contain any material mis¬
statement.
v. The company has neither declared nor paid any
interim dividend or final dividend during the year.
Therefore, reporting under rule 11 (f) of companies
(Audit and Auditors) Rules 2014 is not applicable.
vi. The company has used an accounting software for
maintaining its books of accounts which has a feature
of recording audit trail (edit log) facility and the same
has been operated throughout the year for all the
transactions recorded in the software and the audit
trail feature has not been tampered with. The audit
trail has been preserved by the company as per the
statutory requirements for record retention.
For K.P.Rao & Co
Chartered Accountants
Firm Reg. No. 003135S
Prashanth S
Partner
Membership Number: 228407
UDIN: 26228407GIAANQ7521
Place: Bangalore
Date : 15.05.2026
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