GRASIM Auditors Report

REPORT ON THE STANDALONE IND AS FINANCIAL STATEMENTS

We have audited the accompanying standalone Ind AS financial statements of GRASIM INDUSTRIES LIMITED (“the Company”), which comprise the Balance sheet as at 31 March 2017, and the Statement of profit and loss (including Other Comprehensive Income), the Statement of Cash flows and the Statement of changes in equity, for the year then ended, and a summary of the significant accounting policies and other explanatory information (herein after referred to as “standalone Ind AS financial statements”).

MANAGEMENT’S RESPONSIBILITY FOR THE STANDALONE IND AS FINANCIAL STATEMENTS

The Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these standalone Ind AS financial statements that give a true and fair view of the financial position, financial performance, 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) prescribed under Section 133 of the Act read with the rules issued thereunder.

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 Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

AUDITOR’S RESPONSIBILITY

Our responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder.

We conducted our audit of standalone Ind AS financial statements in accordance with the Standards on Auditing specified under Section 143(10) of the Act.Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company’s preparation of the standalone Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting estimates made by the Company’s Directors, as well as evaluating the overall presentation of the standalone Ind AS financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.

OPINION

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone Ind AS financial statements give the information required by the Act, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India including the Ind AS, of the state of affairs of the Company as at 31 March 2017 and its financial performance including other comprehensive income, its cash flows and changes in equity for the year ended on that date.

OTHER MATTERS

The comparative financial information of the Company for the year ended 31 March 2016 and the transition date opening balance sheet as at 1 April 2015 included in these standalone Ind AS financial statements, are based on the previously issued statutory financial statements prepared in accordance with the Companies (Accounting Standards) Rules, 2006 audited by the predecessor auditors whose report for the year ended 31 March 2016 and 31 March 2015 dated 7 May 2016 and 2 May 2015 respectively expressed an unmodified opinion on those standalone financial statements, as adjusted for the differences in the accounting principles adopted by the Company on transition to Ind AS, which have been audited by B S R & Co. LLP, Chartered Accountants, one of the joint auditors of the Company.

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

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

As required by the Companies (Auditor’s Report) Order, 2016 (“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 A” a statement on the matters specified in paragraphs 3 and 4 of the said Order, to the extent applicable.

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, the Statement of Cash flows and the 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 Ind AS financial statements comply with the Indian Accounting Standards specified under Section 133 of the Act read with relevant rule issued thereunder;

(e) on the basis of the written representations received from the directors as on 31 March 2017 taken on record by the Board of Directors, none of the directors is disqualified as on 31 March 2017 from being appointed as a director in terms of Section 164 (2) of the Act; and

(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 B”; and

(g) with respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. the Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements. Refer Note 4.1 to the standalone Ind AS financial statements;

ii. the Company did not have any long-term contracts, including derivative contracts, for which there were any material foreseeable losses;

iii. there has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Company; and

iv. the Company has provided requisite disclosures in the standalone Ind AS financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8 November, 2016 to 30 December, 2016 and these are in accordance with the books of accounts maintained by the Company. Refer Note 4.7.8 to the standalone Ind AS financial statements.

ANNEXURE-A

to the Independent Auditor’s Report

With reference to the Annexure referred to in the Independent Auditor’s Report to the Members of Grasim Industries Limited (‘the Company’) on the standalone Ind AS financial statements for the year ended 31 March 2017, we report the following:

(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation, of the fixed assets (property plant and equipment).

(b) The Company has a regular programme of physical verification of its fixed assets (property plant and equipment) by which all fixed assets (property plant and equipment) are verified in a phased manner over a period of two to three years. In accordance with this programme, a portion of the fixed assets (property plant and equipment) has been physically verified by the management during the year and no material discrepancies have been noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the Company and the nature of its assets.

(c) According to the information and explanations given to us and on the basis of our examination of the records of the Company, the title deeds of immovable properties, as disclosed in Note 2.1.1 to the standalone Ind AS financial statements, are held in the name of the Company, except for the following:

Particulars	Leasehold land	Freehold land
Gross Block as at 31 March 2017	74.12	75.05
Net Block as at 31 March, 2017	64.17	75.05
Number of Cases	104	37

(ii) Inventory, except good-in-transit, has been physically verified by management at reasonable intervals during the year. In our opinion, the frequency of such verification is reasonable. Discrepancies noticed on such verification between physical stocks and the book records were not material and these have been properly dealt with in the books of account.

(iii) In our opinion and according to information and explanations given to us, the Company has not granted any loans, secured or unsecured, to companies, firms, limited liability partnerships or other parties covered in the register maintained under Section 189 of the Act. Accordingly, paragraph 3(iii) of the Order is not applicable to the Company.

(iv) The Company has not granted any loans or provided any guarantees or security to the parties covered under Section 185 of the Act. The Company has complied with the provisions of Section 186 of the Act with respect to loans and investments. The Company has not provided any guarantee or security to the parties covered under Section 186 of the Act.

(v) The Company has not accepted any deposits from the public in accordance with the provisions of Sections 73 to 76 of the Act and the rules framed there under.

(vi) We have broadly reviewed the cost records maintained by the Company pursuant to the rules prescribed by Central Government for maintenance of cost records under sub section (1) of Section 148 of the Act and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. However, we have not made a detailed examination of the records.

(vii) (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing the undisputed statutory dues including Provident fund, Employees’ state insurance, Income tax, Sales tax, Service tax, duty of Customs, duty of Excise, Value added tax, Cess and other material statutory dues applicable to it with the appropriate authorities.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident fund, Employees’ state insurance, Income tax, Sales tax, Service tax, duty of Customs, duty of Excise, Value added tax, Cess and other material statutory dues were in arrears as at 31 March 2017 for a period of more than six months from the date they became payable.

(b) According to the information and explanations given to us, there are no dues of Income tax, Sales tax, Service tax, duty of Customs, duty of Excise or Value added tax, which have not been deposited with the appropriate authorities on account of any dispute other than those mentioned in Appendix I to this report.

Name of the Statute	Nature of the Dues	Amount	period to which	Forum where dispute
		(Rs. Crores)	the amount relates	is pending
Income Tax Act,	Income Tax and	144.57	2005-2014	Appellate Authority
1961	Interest	0.48	2007-2016	Assessing Authority
Sales Tax / Value	Sales Tax, VAT,	0.01	2008-2009	High Court
Added Tax Act	Interest and Penalty	5.21	2006-2017	Appellate Authority
Entry Tax Act	Entry Tax and Interest	5.61	2006-2017	Supreme Court
		13.46	2004-2017	High Court
		1.35	2007-2013	Appellate Authority
Service Tax under	Service Tax, Interest	0.01	2009-2010	High Court
Finance Act, 1994	and Penalty	9.19	2004-2017	Appellate Authority
		1.57	1997-2016	Assessing Authority
Customs Act, 1962	Customs Duty,	10.87	2004-2017	Appellate Authority
	Interest and Penalty	0.63	2005-2008	Assessing Authority
Central Excise Act,	Excise duty, Interest	2.27	1999-2017	High Court
1944	and Penalty	43.89	1999-2017	Appellate Authority
		7.22	1995-2017	Assessing Authority

(viii) In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of loans or borrowings to banks and government. The Company did not have any outstanding dues to financial institution and debenture holders.

(ix) In our opinion and according to the information and explanations given to us, the Company has not raised any moneys by way of initial public offer or further public offer (including debt instruments) and term loans during the year. Accordingly, the provisions of Clause 3(ix) of the Order are not applicable to the Company

(x) According to the information and explanations given to us, no material fraud by the Company or on the Company by its officers or employees has been noticed or reported during the course of our audit.

(xi) According to the information and explanations give to us and based on our examination of the records, the Company has paid or provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section 197 read with Schedule V to the Act.

(xii) In our opinion and according to the information and explanations given to us, the Company is not a Nidhi Company. Accordingly, paragraph 3(xii) of the Order is not applicable to the Company.

(xiii) According to the information and explanations given to us and based on our examination of the records of the Company, transactions with the related parties are in compliance with Sections 177 and 188 of the Act, where applicable. The details of such related party transactions have been disclosed in the financial statements as required under Indian Accounting Standard (Ind AS) 24, Related Party Disclosures notified under the Companies (Indian Accounting Standards) (Amendment) Rules, 2016.

(xiv) According to the information and explanations give to us and based on our examination of the records, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year. Accordingly, paragraph 3(xiv) of the Order is not applicable to the Company.

(xv) According to the information and explanations given to us and based on our examination of the records, the Company has not entered into non-cash transactions with directors or persons connected with him. Accordingly, paragraph 3(xv) of the Order is not applicable.

(xvi) In our opinion and according to the information and explanations given to us, the Company is not required to be registered under Section 45-IA of the Reserve Bank of India Act, 1934. Accordingly, paragraph 3 (xvi) of the Order is not applicable.

For G. P Kapadia & Co. For B S R & Co. LLP

Chartered Accountants Chartered Accountants

Firm’s Registration No: 104768W Firm’s Registration No: 101248W/W-100022

Atul B. Desai Akeel Master

Partner Partner

Membership No: 30850 Membership No: 046768

Place: Mumbai

19th May 2017

We have audited the accompanying standalone financial statements of
GRASIM INDUSTRIES LIMITED ("the Company"), which comprise the Balance
Sheet as at 31 st March, 2016, the Statement of Profit and Loss and the
Cash Flow Statement for the year then ended, and a summary of the
significant accounting policies and other explanatory information

Management''''s Responsibility for the Standalone Financial Statements

The Company''''s Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("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 and
cash flows of the Company in accordance with the accounting principles
generally accepted in India, including the Accounting Standards
prescribed under section 133 of the Act, as applicable

This responsibility also includes maintenance of adequate accounting
records in accordance with the provisions of the Act for safeguarding
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 financial
statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error

Auditor''''s Responsibility

Our responsibility is to express an opinion on these standalone
financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting
and auditing standards and matters which are required to be included in
the audit report under the provisions of the Act and the Rules made
thereunder and the Order under section 143(11) of the Act.

We conducted our audit of the standalone financial statements in
accordance with the Standards on Auditing specified under Section
143(10) of the Act. Those Standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free from material
misstatement

An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the financial statements. The
procedures selected depend on the auditor''''s judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal financial control relevant
to the Company''''s preparation of the financial statements that give a
true and fair view in order to design audit procedures that are
appropriate in the circumstances. An audit also includes evaluating the
appropriateness of the accounting policies used and the reasonableness
of the accounting estimates made by the Company''''s Directors, as well as
evaluating the overall presentation of the financial statements

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

Opinion

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 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 31st March, 2016, and its profit and its cash flows for the year
ended on that date

Report on Other Legal and Regulatory Requirements

1. 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, and the Cash
Flow Statement 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 prescribed under section 133 of the Act,
as applicable

e) On the basis of the written representations received from the
directors as on 31st March, 2016 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2016
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 A". Our report
expresses an unmodified opinion on the adequacy and operating
effectiveness of the Company''''s internal financial controls over
financial reporting

g) 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

The Company has disclosed the impact of pending litigations on its
financial position in its financial statements - Refer Note 4.1.1 to
the financial statement;

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

iii. There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Company

2. As required by the Companies (Auditor''''s Report) Order, 2016 ("the
Order") issued by the Central Government in terms of Section 143(11) of
the Act, we give in "Annexure B" a statement on the matters specified
in paragraphs 3 and 4 of the Order

(Referred to in paragraph 2 under ''''Report on Other Legal and Regulatory
Requirements'''' section of our report of even date of GRASIM
INDUSTRIESLIMITED for the year ended March 31, 2016)

(i) In respect of its fixed assets

(a) The Company has maintained proper records showing full particulars,
including quantitative details and situation of fixed assets

(b) The Company has a program of verification of fixed assets to cover
all the items in phased manner over a period of 2 to 3 years which, in
our opinion, is reasonable having regard to the size of the Company and
the nature of its assets. Pursuant to the program, certain fixed
assets were physically verified by the Management during the year.
According to the information and explanations given to us, no material
discrepancies were noticed on such verification

(c) According to information and explanations given to us and on the
basis of our examination of the records of the Company, the title deeds
of immovable properties are held in the name of the Company as at the
Balance Sheet date except for the following which are not held in the
name of the Company:

(Rs. in Crores)

Particulars Leasehold Land* Freehold Land*

Gross Block as at 31 March, 2016 76.68 103.75

Net Block as at 31 March, 2016 68.83 103.75

* Leasehold land includes Rs. 35.60 Crore (Gross) and Rs. 31.44 Crore
(Net) and Freehold land of Rs. 103.75 Crore (Gross and Net),
transferred during the year on account of amalgamation and acquisition

(ii) As explained to us, the inventories were physically verified
during the year by the Management at reasonable intervals and no
material discrepancies were noticed on physical verification

(iii) The Company has not granted any loans, secured or unsecured, to
companies, firms, Limited Liability Partnerships or other parties
covered in the register maintained under Section 189 of the Companies
Act, 2013

(iv) The Company has not granted any loans or made investments or
provided guarantees which are covered under the provisions of Section
185 and 186 of the Companies Act, 2013 and hence reporting under clause
(iv) of the CARO 2016 is not applicable

(v) According to the information and explanations given to us, the
Company has not accepted any deposit during the year in terms of the
provisions of Section 73 and 76 or any other relevant provisions of the
Companies Act, 2013

(vi) We have broadly reviewed the cost records maintained by the
Company pursuant to the Companies (Cost Records and Audit) Rules, 2014,
as amended and prescribed by the Central Government under sub-section
(1) of Section 148 of the Companies Act, 2013, and are of the opinion
that, prima facie, the prescribed cost records have been made and
maintained We have, however, not made a detailed examination of the
cost records with a view to determine whether they are accurate or
complete

(vii) According to the information and explanations given to us, in
respect of statutory dues

(a) The Company has generally been regular in depositing undisputed
statutory dues, including Provident Fund, Employees'''' State Insurance,
Income Tax, Sales Tax, Service Tax, Customs Duty, Excise Duty, Value
Added Tax, Cess and other material statutory dues applicable to it with
the appropriate authorities.

(b) There were no undisputed amounts payable in respect of Provident
Fund, Employees'''' State Insurance, Income Tax, Sales Tax, Service Tax,
Customs Duty, Excise Duty, Value Added Tax, Cess and other material
statutory dues in arrears as at March 31, 2016, for a period of more
than six months from the date they became payable

(c) Details of dues of Income Tax, Sales Tax, Service Tax, Customs
Duty, Excise Duty and Value Added Tax which have not been deposited as
on March 31, 2016 on account of disputes are given below:

Name of Statute Nature of the Dues Forum where Dispute is
Pending

Income-tax Income Tax and Appellate Authorities
Act, 1961 Interest
Assessing Authorities

Sales Tax/Value SalesTax/VAT High Court
Added Tax Act Penalty and Interest
Appellate Authorities

High Court
Central Excise Excise Duty, Penalty
Appellate Authority
Act, 1944 and Interest
Assessing Authority

Customs Customs Duty, Appellate Authority
Act, 1962 Penalty and Interest

Supreme Court
Entry Tax and Entry Tax Act
High Court
Interest
Appellate Authority

High Court
Service Tax under Service Tax, Penalty
Appellate Authority
Finance Act, 1994 and Interest
Assessing Authority

Name of Statute Period to which the Amount Unpaid
Amount Relates (Rs. in Crores)

Income-tax Act, 1961 2001-2015 219.62

2007-2016 0.66

Sales Tax/Value Added
Tax Act 2008-2009 0.01

2006-2016 1.92

1996-2016 1.98

Central Excise Act, 1944 1999-2016 75.15

2015-2016 0.06

Customs Act, 1962 2004-2016 10.57

2005-2006 2.20

Entry Tax Act 2004-2016 11.87

2007-2012 0.90

Service Tax under
Finance Act, 1994 2009-2010 0.01

1997-2016 8.38

2014-2016 0.01

(viii) In our opinion and according to the information and explanations
given to us, the Company has not defaulted in the repayment of loans or
borrowings to financial institutions, banks and government. The Company
has not issued any debentures

(ix) In our opinion and according to the information and explanations
given to us, money raised by way of term loans have been applied by the
Company during the year for the purposes for which they were raised,
other than temporary deployment pending application of proceeds. The
Company did not raise money by way of initial public offer (including
debt instruments) during the year

(x) To the best of our knowledge and according to the information and
explanations given to us, no fraud by the Company and no fraud on the
Company by its officers or employees has been noticed or reported
during the year.

(xi) In our opinion and according to the information and explanations
given to us, the Company has paid/provided managerial remuneration in
accordance with the requisite approvals mandated by the provisions of
Section 197 read with Schedule V to the Companies Act, 2013

(xii) The Company is not a Nidhi Company and hence reporting under
clause (xii) of the CARO 2016 Order is not applicable

(xiii) In our opinion and according to the information and explanations
given to us, the Company is in compliance with Section 188 and 177 of
the Companies Act, 2013, where applicable, for all transactions with
the related parties and the details of related party transactions have
been disclosed in the financial statements, etc., as required by the
applicable accounting standards.

(xiv) During the year the Company has not made any preferential
allotment or private placement of shares or fully or partly convertible
debentures and hence reporting under clause (xiv) of CARO 2016 is not
applicable to the Company.

(xv) In our opinion and according to the information and explanations
given to us, during the year the Company has not entered into any
non-cash transactions with its directors or persons connected with him
and hence provisions of Section 192 of the Companies Act, 2013 are not
applicable

(xvi) The Company is not required to be registered under section 45-I
of the Reserve Bank of India Act, 1934

For DELOITTE HASKINS & SELLS LLP For G. R KAPADIA & CO.

Chartered Accountants Chartered Accountants

(Firm''''s Registration No.
117366W/W-100018)) (Firm''''s Registration No.
104768W)

Saira Nainar Atul B. Desai

Partner Partner

Membership No. 40081 Membership No. 30850

Place: Mumbai

Date: 7th May, 2016

Report on the Financial Statements

We have audited the accompanying Standalone financial statements of
GRASIM INDUSTRIES LIMITED ("the Company"), which comprise the Balance
Sheet as at March 31, 2015, the Statement of Profit and Loss, the Cash
Flow Statement and a summary of the signifi cant accounting policies
and other explanatory information for the year then ended, in which are
incorporated the Returns for the year ended on that date audited by the
branch auditors of the Company''s branch at Malanpur.

Management''s Responsibility for the Standalone Financial Statements

The Company''s Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation of these standalone fi nancial statements that give
a true and fair view of the fi nancial position, fi nancial performance
and cash fl ows of the Company in accordance with the accounting
principles generally accepted in India, including the Accounting
Standards specifi ed under Section 133 of the Act, read with Rule 7 of
the Companies (Accounts) Rules, 2014. This responsibility also includes
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding 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 fi nancial
controls, that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and
presentation of the fi nancial statements that give a true and fair
view and are free from material misstatement, whether due to fraud or
error.

Auditors'' Responsibility

Our responsibility is to express an opinion on these standalone fi
nancial statements based on our audit.

We have taken into account the provisions of the Act, the accounting
and auditing standards and matters which are required to be included in
the audit report under the provisions of the Act and the Rules made
thereunder.

We conducted our audit in accordance with the Standards on Auditing
specifi ed under section 143(10) of the Act. Those Standards require
that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the fi nancial statements
are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about
the amounts and the disclosures in the fi nancial statements. The
procedures selected depend on the auditor''s judgment, including the
assessment of the risks of material misstatement of the fi nancial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal fi nancial control relevant
to the Company''s preparation of the fi nancial statements that give a
true and fair view in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing
an opinion on whether the Company has in place an adequate internal fi
nancial controls system over fi nancial reporting and the operating
effectiveness of such controls. An audit also includes evaluating the
appropriateness of the accounting policies used and the reasonableness
of the accounting estimates made by the Company''s Directors, as well as
evaluating the overall presentation of the fi nancial statements.

We believe that the audit evidence we have obtained is suffi cient and
appropriate to provide a basis for our audit opinion on the standalone
financial statements.

Opinion

In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid standalone fi nancial
statements give the information required by 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, 2015, and its profi t and its
cash fl ows for the year ended on that date.

Other Matter

We did not audit the fi nancial statements of one branch included in
the standalone fi nancial statements of the Company whose fi nancial
statements refl ect total assets of Rs. 45.35 crores as at March 31,
2015 and total revenues of Rs. 82.44 crores for the year ended on that
date, as considered in the standalone fi nancial statements. The fi
nancial statements of these branches have been audited by the 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.
Our opinion is not modifi ed in respect of this matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor''s Report) Order, 2015 ("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 a statement on the matters specifi ed in paragraphs 3 and
4 of the Order, to the extent applicable.

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

(a) We have sought and 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 and proper returns adequate for the purposes of our audit
have been received from the branches not visited by us.

(c) The reports on the accounts of the branch of the Company, at
Malanpur, audited under Section 143(8) of the Act by the 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 Profi t and Loss, and the Cash
Flow Statement dealt with by this Report are in agreement with the
books of account and with the returns received from the branch not
visited by us.

(e) In our opinion, the aforesaid standalone fi nancial statements
comply with the Accounting Standards specifi ed under Section 133 of
the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

(f) On the basis of the written representations received from the
directors as on March 31, 2015 taken on record by the Board of
Directors, none of the directors is disqualifi ed as on March 31, 2015
from being appointed as a director in terms of Section 164(2) of the
Act.

(g) With respect to the other matters to be included in the Auditor''s
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its
fi nancial position in its fi nancial statements ? Refer Notes 4.1.1 to
the fi nancial statements;

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

iii. There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Company.

ANNEXURE TO THE INDEPENDENT AUDITORS'' REPORT

(Referred to in paragraph 1 under ''Report on Other Legal and Regulatory
Requirements'' section of our report of even date of GRASIM INDUSTRIES
LIMITED for the year ended March 31, 2015)

Having regard to the nature of the Company''s business/ activities/
results during the year, clause (viii) regarding accumulated losses and
cash loss incurred by the Company of paragraph 3 of the Order is not
applicable to the Company.

(i) In respect of its fi xed assets:

(a) The Company has maintained proper records showing full particulars,
including quantitative details and situation of fi xed assets;

(b) The fi xed assets of were physically verifi ed during the year by
the Management in accordance with a regular programme of verifi cation
which, in our opinion, provides for physical verifi cation of all the
fi xed assets at reasonable intervals. According to the information and
explanation given to us, no material discrepancies were noticed on such
verifi cation.

(ii) In respect of its inventories:

(a) As explained to us, the inventories were physically verifi ed
during the year by the Management at reasonable intervals except stocks
lying with third parties, for which confi rmations have been obtained
from those parties;

(b) In our opinion and according to the information and explanations
given to us, the procedures of physical verifi cation of inventory
followed by the Management were reasonable and adequate in relation to
the size of the Company and the nature of its business;

(c) In our opinion and according to the information and explanations
given to us, the Company has maintained proper records of its
inventories and no material discrepancies were noticed on physical
verifi cation.

(iii) According to the information and explanations given to us, the
Company has not granted any loans, secured or unsecured, to companies,
fi rms or other parties covered in the Register maintained under
Section 189 of the Act.

(iv) In our opinion and according to the information and explanations
given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business with regard
to purchases of inventory and fi xed assets and the sale of goods and
services. During the course of our audit, we have not observed any
major weaknesses in such internal control system.

(v) According to the information and explanations given to us, the
Company has not accepted any deposit from the public during the year in
terms of the provisions of Sections 73 and 76 or any other relevant
provisions of the Act.

(vi) We have broadly reviewed the cost records maintained by the
Company pursuant to the Companies (Cost Records and Audit) Rules, 2014,
as amended and prescribed by the Central Government under sub-section
(1) of Section 148 of the Companies Act, 2013, and are of the opinion
that, prima facie, the prescribed cost records have been made and
maintained. We have, however, not made a detailed examination of the
cost records with a view to determine whether they are accurate or
complete.

(vii) According to the information and explanations given to us, in
respect of statutory dues:

(a) The Company has been regular in depositing undisputed statutory
dues, including Provident Fund, Employees'' State Insurance, Income-Tax,
Sales-Tax, Value Added Tax, Wealth Tax, Service Tax, Customs Duty,
Excise Duty, Cess and other material statutory dues applicable to it
with the appropriate authorities.

(b) There were no undisputed amounts payable in respect of Provident
Fund, Employees'' State Insurance, Income-tax, Sales Tax, Value Added
Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty, Cess and other
material statutory dues in arrears as at March 31, 2015 for a period of
more than six months from the date they became payable.

(c) Details of dues of Income Tax, Sales Tax, Value Added Tax, Wealth
Tax, Service Tax, Customs Duty, Excise Duty and Cess which have not
been deposited as on March 31, 2015 on account of disputes are given
below:

Name of the Nature of the Forum Where
Statute Dues Dispute is Pending

Income Tax Act, Income Tax and Appellate Authorities
1961 Interest

High Court
Sales Tax / Value Sales Tax and Appellate Authorities
Added Tax Act Interest Assessing Authority

Excise Duty, High Court
Central Excise Act Penalty and Appellate Authority
Interest

Customs Duty, Appellate Authority
Customs Act, 1962 Penalty and Assessing Authority
Interest

High Court
Entry Tax Act Entry Tax Appellate Authority

Service Tax under High Court
Service Tax
Finance Act, 1994 Appellate Authority

Cess / Duty under High Court
Cess / Duty
various Acts Appellate Authority

Name of the Statute Period to Amount
which the (Rs. in crores)
amount
relates

Income Tax Act, 1961 2007-2015 128.65

Sales Tax/Value Added Tax Act 2008-2009 0.01

2008-2014 0.42

2010-2011 0.02

Central Excise Act 1999-2001 1.78

2005-2015 125.85

Customs Act, 1962 2012-2015 9.00

2004-2006 1.00

Entry Tax Act 2004-2015 10.44

2007-2012 0.88

Service Tax Under Finance Act, 1994 2009-2010 0.01

2006-2012 1.08

Cess/Duty Under Various Acts 1988-1989 0.49

1978-1980 0.10

(d) The company has been regular in transferring amounts to the
Investor Education and Protection Fund in accordance with the relevant
provisions of the C ompanies Act, 1956 (1 of 1956) and Rules made
thereunder within time.

(viii) In our opinion and according to the information and explanations
given to us, and based on the records of the Company, the Company has
not defaulted in the repayment of dues to fi nancial institutions,
banks and debenture holders.

(ix) According to the information and explanations given to us, the
Company has not given any guarantees for loans taken by others from
banks or fi nancial institutions.

(x) In our opinion and according to the information and explanations
given to us, the term loans have been applied by the Company during the
year for the purposes for which they were obtained, other than
temporary deployment pending application.

(xi) To the best of our knowledge and according to the information and
explanations given to us, no fraud by the Company and no material fraud
on the Company has been noticed or reported during the year nor have we
been informed of such case by the management.

For DELOITTE HASKINS & SELLS LLP For G. P. KAPADIA & CO.

Chartered Accountants Chartered Accountants

(Firm Registration No. 117366W/W-100018) (Firm Registration No.
104768W)

Saira Nainar Atul B. Desai

Partner Partner

Membership No.: 40081 Membership No.: 30850

Mumbai, 2nd May, 2015