Parle Industries Limited

Report on the Audit of the Standalone Financial Statements

Qualified Opinion

We have audited the accompanying Standalone Financial Statements of Parle Industries Limited (“the Company”), which comprise the Standalone Balance Sheet as at March 31, 2025, and the Standalone Statement of Profit and Loss, including the statement of other comprehensive income, the Standalone Statement of Cash Flows and the Standalone Statement of Changes in Equity for the year ended on that date, and notes to standalone financial statements, including a summary of material accounting policies and other explanatory information (herein after referred to as “Standalone Financial Statements”).

In our opinion and to the best of our information and according to the explanations given to us, except for the possible effects of the matters described in the ‘Basis for Qualified Opinion’ section of our report, the aforesaid Standalone Financial Statements give the information required by the Companies Act, 2013 (“the Act”) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, (“Ind AS”) and other accounting principles generally accepted in India, of the state of affairs of the Company as at March 31,2025, the Profit and other comprehensive Income, changes in equity and its cash flows for the year ended on that date.

Basis for Qualified Opinion

1. Non - Receipt of Consideration in Share Purchase Agreement - Legal Dispute:

During the year, the Company has allotted its equity shares to the respective shareholders of two entities, namely ‘Welldone Integrated Services Private Limited (“WISPL”)’ and ‘Marvellous Vickyfoods Private Limited (“MVPL”)’ on a share-swap basis, constituting consideration other than cash. As represented by the management to us, the company has issued legal notice of termination dated June 11,2025, to the shareholders of the aforesaid entities which have failed to transfer the underlying shares and share certificates of these two entities to the Company. As a result, the total investment and corresponding equity share capital of ?81.54 crores recorded in the standalone financial statements is under legal dispute.

2. Impact of Financial Statements

In view of the above dispute, the investment of ?81.54 crores in the two entities is overstated, as recorded in the standalone financial statements, is uncertain and subject to resolution of ongoing litigation. Consequently, the corresponding issue of share capital and securities premium, aggregating ?81.54 crores is also overstated and are liable to be forfeited due to non-payment of consideration, in terms of Articles of Association of the Company. The materiality of the amount involved needs to be neutralized, we believe that the financial statements present a true and fair view in accordance with the applicable financial reporting framework except in respect of these investment and corresponding equity share capital and securities premium.

We conducted our audit of the standalone financial statements in accordance with the Standards on Auditing specified under section 143(10) of the Act (SAs). 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 independence requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act and the Rules made there under, 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 qualified audit opinion on the standalone financial statements.

Emphasis of Matter

We draw attention to the following matters disclosed to us during the course of our audit:

During the year, the Company has allotted its equity shares to the respective shareholders of two entities, namely Welldone Integrated Services Private Limited and Marvellous Vickyfoods Private Limited, on a share-swap basis constituting consideration other than cash under share purchase agreement.

The Company has received formal objections from shareholders of two entities dated May 30, 2025, in response to the Company’s communication dated May 29, 2025, which had intimated the agenda of a Board meeting convened to review a preferential allotment of shares undertaken through a share swap basis under a Share Purchase Agreement (SPA). These shareholders have asserted that the said allotment was duly approved by a special resolution passed on September 30, 2024, and therefore consider the transaction as concluded and not subject to further review. In addition, the Company received communications from these two entities indicating that their audited financial statements for the year ended March 31, 2025, had been finalized for consolidation but they were not communicated by the Company.

Management of Company has informed us that these two entities had wilfully not paid the consideration of Rs.36 per share (payable vide Share Swap) on allotment of shares to mislead the authority without giving any documentary proof to substantiate their claim. The holding Company is empowered by its Articles of Association to forfeit shares of the such shareholders who have not paid consideration. Therefore, as per the management the objections raised by such shareholder cannot be construed to be bonafide.

Further, the Company issued a legal notice dated June 11, 2025, to the aforesaid 2 entities and their shareholders citing multiple breaches of the Share Purchase Agreement, including the following:

• Failure to transfer & issue share certificates to the Company as per the agreed Share Purchase Agreement.

• Denial of access to books, account, papers, records and documents of the aforesaid two entities to the Company and its authorized representatives.

• Not permitting the Company to appoint its representatives on the Board of Directors of the aforesaid two entities.

• Not providing information in relation to business, operations, finances, properties, assets and liabilities of two entities.

• Failure to facilitates the company’s compliance requirement despite repeated requests and meetings.

In light of the above, the Board of Directors of the Company, in its meeting held on June 11,2025, unanimously resolved to terminate the Share Purchase Agreement with the aforesaid two entities and their shareholders.

Our opinion is not modified in respect of this matter.

Information Other than the Standalone Financial Statements and Auditor’s Report Thereon (‘Other Information’)

• The Company’s management and Board of Directors are 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 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 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 and Board of Directors for Standalone Financial Statements

The Company’s Management and the Board of Directors are responsible for the matters stated in Section 134(5) of the Act with respect to the preparation and presentation of these Standalone Financial Statements that give a true and fair view of the financial position, financial performance including other comprehensive income, cash flows and changes in equity of the Company in accordance with the accounting principles generally accepted in India, including Indian accounting standards (Ind AS) specified under Section 133 of the Act read with Companies (Indian Accounting standards) Rules, 2015, as amended. 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 Standalone Financial Statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the Standalone Financial Statements, the management and the Board of Directors are responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless Board of Director either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Board of Directors are responsible for overseeing the Company’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Standalone Financial Statements

Our objectives are to obtain reasonable assurance about whether the Standalone Financial Statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Standalone Financial Statements.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the Standalone Financial Statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls.

• Obtain an understanding of internal financial controls relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the Company has adequate internal financial controls system in place and the operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the Standalone Financial Statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure, and content of the Standalone Financial Statements, including the disclosures, and whether the Standalone Financial Statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements for the financial year ended March 31,2025. 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 Section 143(3) of the Act, based on our audit 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, except for the matters described in the Basis for Qualified Opinion paragraph;

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 Standalone Balance Sheet, the Standalone Statement of Profit and Loss including the statement of Other comprehensive income, the Standalone Cash Flow statement and Standalone 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 Indian Accounting Standards specified under Section 133 of the Act, read with the Companies (Indian Accounting standards) Rules, 2015, as amended, except for possible effects of the matters described in the Basis for Qualified Opinion paragraph;

e) On the basis of the written representations received from the directors as on March 31, 2025 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2025 from being appointed as a director in terms of Section 164 (2) of the Act.

f) The matter described in the Basis for Qualified Opinion paragraph above, in our opinion, may have an adverse effect on the functioning of the company;

g) The qualification relating to the other matters connected with the Standalone Financial Statements are as stated in the Basis for Qualified Opinion paragraph above;

h) With respect to the adequacy of the internal financial controls over financial reporting with reference to Standalone Financial Statement and the operating effectiveness of such controls, refer to our separate Report in “Annexure A”. Our report expresses an modified opinion on the adequacy and operating effectiveness of the Company’s internal financial controls with reference to Standalone Financial Statements.

i) With respect to the other matters to be included in the Auditor’s Report in accordance with the requirements of section 197(16) of the Act, as amended, in our opinion and to the best of our information and according to the explanations given to us, the remuneration paid by the Company to its directors during the year is in accordance with the provisions of section 197 of the Act.

j) 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 given under Note no 7 & 10 to the 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 have been no amounts required to be transferred, to the Investor Education and Protection Fund by the company.

iv. a) Management has represented that, to the best of its knowledge and belief, other than as disclosed in the notes to the accounts, 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 persons or entities, 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) Management has represented that, to the best of its knowledge and belief, other than as disclosed in the notes to the accounts, no funds have been received by the Company from any persons or entities, 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 the audit procedures that has been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations made by the Management under sub clause (a) and (b) above, contain any material misstatement.

2. 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, based on our audit, we give in the ‘Annexure B’, a statement on the matters specified in paragraphs 3 and 4 of the Order.

3. Based on our examination which included test checks, the company has used accounting software for maintaining its books of account which has feature of recording (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the softwares. Further, during the course of our audit we did not come across any instances of audit trail feature being tempered with in respect of the accounting softwares.

For Ajmera & Ajmera,

Chartered Accountants

(Firm’s Registration No. 018796C)

Sd/-

Per Omprakash Ajmera

Partner

Membership No. 157420

UDIN : 25157420BMILES2734

Date : June 20, 2025

Place : Mumbai