Aegis Logistics

1.  We have audited the attached Balance Sheet of Aegis Logistics
 Limited (the Company) as at 31st March, 2009 and also the Profit and
 Loss account and the Cash Flow statement for the year ended on that
 date annexed thereto. These financial statements are the responsibility
 of the Companys management. Our responsibility is to express an
 opinion on these financial statements based on our audit.
 
 2.  We conducted our audit in accordance with auditing standards
 generally accepted in India. Those standards require that we plan and
 perform the audit to obtain reasonable assurance about whether the
 financial statements are free of material misstatement. An audit
 includes examining, on a test basis, evidence supporting the amounts
 and disclosures in the financial statements. An audit also includes
 assessing the accounting principles used and significant estimates made
 by management, as well as evaluating the overall financial statement
 presentation. We believe that our audit provides a reasonable basis for
 our opinion.
 
 3.  As required by the Companies (Auditors Report) Order, 2003 (the
 Order) issued by the Central Government of India in terms of
 sub-section (4A) of Section 227 of the Companies Act, 1956 we enclose
 in the Annexure, a Statement on the matters specified in paragraphs 4
 and 5 of the said Order.
 
 4.  Further to our comments in the Annexure referred to in paragraph 3
 above, we report that:
 
 a) We have 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 appears from our examination of those
 books;
 
 c) The Balance Sheet, the Profit and Loss account and the Cash Flow
 Statement dealt with by this report are in agreement with the books of
 account;
 
 d) In our opinion, the Balance Sheet, the Profit and Loss account and
 the Cash Flow Statement dealt with by this report comply with the
 Accounting Standards referred to in sub-section (3C) of Section 21 1 of
 the Companies Act, 1956;
 
 e) On the basis of written representations received from the directors
 as on 31st March, 2009 and taken on record by the Board of Directors,
 we report that none of the directors is disqualified as on 31st March,
 2009 from being appointed as a director in terms of clause (g) of
 sub-section (1) of Section 274 of the Companies Act, 1956;
 
 f) Without qualifying our opinion we draw attention to Mote No. B (5)
 (i) of Schedule 18 regarding provision of Rs. 247.13 lacs made in the
 books for commission by way of percentage of net profits of the Company
 payable to the managing directors being dependent upon the grant of
 approval by the Central Government of their appointments as the
 managing directors.
 
 g) In our opinion and to the best of our information and according to
 the explanations given to us, the said accounts, read together with the
 notes thereon, give the information required by the Companies Act,
 1956, in the manner so required and give a true and fair view in
 conformity with the accounting principles generally accepted in India:
 
 i) in the case of the Balance Sheet, of the state of affairs of the
 Company as at 31 st March, 2009;
 
 ii) in the case of the Profit and Loss account, of the profit for the
 year ended on that date; and
 
 iii) in the case of the Cash Flow Statement, of the cash flows for the
 year ended on that date.
 
 Annexure to the Auditors Report
 
 Referred to in paragraph 3 of our report of even date on the accounts
 for the year ended 31st March, 2009 of Aegis Logistics Limited.
 
 (i) The nature of the Companys activities during the year has been
 such that clauses (xiii) and (xiv) of paragraph 4 of the Order are not
 applicable to the Company for the year.
 
 (ii) 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) All the fixed assets have not been physically verified by the
 management during the year but there is a regular program of
 verification which in our opinion is reasonable having regard to the
 size of the Company and the nature of its assets. Accordingly, the
 management during the year has conducted a physical verification of
 certain fixed assets. We are informed that no material discrepancies
 were noticed by the management on such verification.
 
 (c) The fixed assets disposed off during the year, in our opinion, do
 not constitute a substantial part of the fixed assets of the Company
 and such disposal has, in our opinion, not affected the going concern
 status of the Company.
 
 (iii) In respect of its inventories:
 
 (a) As explained to us, inventories were physically verified during the
 year by the management at reasonable intervals.
 
 (b) In our opinion and according to the information and explanations
 given to us, the procedures of physical verification of inventories
 followed by the management are 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 is maintaining proper records of its
 inventories and discrepancies noticed on verification between the
 physical stocks and the book records were not material in relation to
 the operations of the Company.
 
 (iv) According to the information and explanations given to us the
 Company has not granted or taken any loans, secured or unsecured, to or
 from companies, firms or other parties covered in the register
 maintained under Section 301 of the Companies Act 1956.
 
 In view of what has been stated above, sub-clauses (b), (c), (d),
 (f)and (g) of clause (iii)ofparagraph 4 of the Order are not applicable
 to the Company for the year.
 
 (v) In our opinion and according to the information and explanations
 given to us, there are adequate internal control systems commensurate
 with the size of the Company and the nature of its business with regard
 to purchases of inventory and fixed assets and for the sale of goods
 and services. Further on the basis of our examination of the books and
 records of the Company, and according to the information and
 explanations given to us, we have neither come across nor have been
 informed of any continuing failure to correct major weaknesses in the
 aforesaid internal control systems.
 
 (vi) According to the information and explanations given to us, there
 are no contracts or arrangements that need to be entered into a
 Register in pursuance of Section 301 of the Companies Act, 1956.
 Hence, we have no comments to offer in respect of clause v (b) of the
 Order.
 
 (vii) In our opinion and according to the information and explanations
 given to us, the Company has complied with the directives issued by the
 Reserve Bank of India and the provisions of Sections 58A and 58AA or
 any other relevant provisions of the Companies Act, 1956 and the
 Companies (Acceptance of Deposits) Rules, 1975 with regard to the
 deposits accepted from the public.
 
 We were informed that no Order has been passed by the Company Law Board
 or National Company Law Tribunal or Reserve Bank of India or any Court
 or any other Tribunal.
 
 (viii) In our opinion, the Company has an internal audit system
 commensurate with its size and the nature of its business.
 
 (ix) We are informed that maintenance of Cost Records has not been
 prescribed by the Central Government under Section 209(1) (d) of the
 Companies Act, 1956 for any of the products of the Company.
 
 (X) In respect of statutory dues:
 
 (a) According to the information and explanations given to us, the
 Company has been generally regular in depositing undisputed material
 statutory dues, including Provident Fund, Investor Education and
 Protection Fund, Employees State Insurance, Income tax, Sales tax,
 Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other
 statutory dues applicable to it with the appropriate authorities during
 the year.
 
 (b) According to the information and explanations given to us, no
 undisputed amounts payable in respect of Income tax, Wealth tax,
 Service Tax, Sales tax, Custom duty. Excise duty and cess were
 outstanding as at 31st March, 2009 for period of more than six months
 from the date they became payable.
 
 (c) According to the records of the Company, there are no dues of Sales
 tax, Income tax, Custom duty, Wealth tax, Service Tax, Excise duty and
 Cess, which have not been deposited on account of any dispute.
 
 (xi) The Company has no accumulated losses as at 31st March, 2009 and
 has not incurred any cash losses during the financial year covered by
 our audit and the immediately preceding financial year.
 
 (xii) In our opinion and according to the information and explanations
 given to us, the Company has not defaulted in the repayment of dues to
 Financial institutions or banks during the year. The Company has not
 issued debentures.
 
 (xiii) According to the information and explanations given to us, the
 Company has not granted any loans and advances on the basis of security
 by way of pledge of shares, debentures and other securities.
 
 (xiv) The Company has given guarantees amounting to Rs. 8,750 lacs for
 loans taken by a subsidiary and an associate from banks. In our opinion
 and according to the information and explanations given to us, the
 terms and conditions, of such guarantees, are not prima facie
 prejudicial to the interest of the Company.
 
 (xv) In our opinion and according to the information and explanations
 given to us, the term loans availed by the Company were, prima facie,
 applied by the Company during the year for the purposes for which the
 loans were obtained, other than temporary deployment pending
 application.
 
 (xvi) According to the information and explanations given to us and on
 an overall examination of the balance sheet of the Company, funds
 raised on short-term basis have, prima facie, not been used during the
 year for long-term investment.
 
 (xvii) The Company has not made any preferential allotment of shares to
 parties and companies covered in the Register maintained under Section
 301 of the Companies Act, 1956 during the year.
 
 (xviii) The Company has not borrowed any monies through issue of
 debentures. Hence, the requirement of reporting on creation of security
 in respect of debentures issued under clause (xix) of paragraph 4 of
 the Order does not arise.
 
 (xix) The Company has not raised any money by public issue during the
 year.
 
 (xx) According to the information and explanations given to us, no
 fraud on or by the Company was noticed or reported during the year.
 
                                    For DELOITTE HASKINS & SELLS
                                           Chartered Accountants
 
                                                 R. LAXMINARAYAN
 Place: Mumbai                                           Partner
 Dated: 30th May, 2009.                     Membership No: 33023