1.  We have audited the attached Balance Sheet of ALSTOM Projects India
 Limited (the Company) as at March 31, 2012, and the related Statement
 of Profit and Loss and Cash Flow Statement for the year ended on that
 date annexed thereto, which we have signed under reference to this
 report. These financial statements are the responsibility of the
 Company''s Management.  Our responsibility is to express an opinion on
 these financial statements based on our audit.
 
 2.  We conducted our audit in accordance with the 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 (Auditor''s Report) Order, 2003, as
 amended by the Companies (Auditor''s Report) (Amendment) Order, 2004
 (together the Order), issued by the Central Government of India in
 terms of sub-section (4A) of Section 227 of ''The Companies Act, 1956''
 of India (the ''Act'') and on the basis of such checks of the books and
 records of the Company as we considered appropriate and according to
 the information and explanations given to us, we give in the Annexure a
 statement on the matters specified in paragraphs 4 and 5 of the 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, Statement of Profit and Loss and Cash Flow
 Statement dealt with by this report are in agreement with the books of
 account;
 
 (d) In our opinion, the Balance Sheet, Statement of Profit and Loss
 and Cash Flow Statement dealt with by this report comply with the
 accounting standards referred to in sub-section (3C) of Section 211 of
 the Act;
 
 (e) On the basis of written representations received from the
 directors, as on March 31, 2012 and taken on record by the Board of
 Directors, none of the directors is disqualified as on March 31, 2012
 from being appointed as a director in terms of clause (g) of
 sub-section (1) of Section 274 of the Act;
 
 (f) In our opinion and to the best of our information and according to
 the explanations given to us, the said financial statements together
 with the notes thereon and attached thereto give, in the prescribed
 manner, the information required by the Act, 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 March 31, 2012;
 
 (ii) in the case of the Statement of Profit and Loss, 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 Auditors'' Report
 
 Refferred to in paragraph 3 of the Auditors'' Report of even date to the
 members of ALSTOM Projects India Limited on the financial statements
 as of and for the year ended March 31, 2012
 
 (i) (a) The Company is maintaining proper records showing full
 particulars, including quantitative details and situation, of fixed
 assets.
 
 (b) The fixed assets are physically verified by the Management
 according to a phased programme designed to cover all the items over a
 period of three years which, in our opinion, is reasonable having
 regard to the size of the Company and the nature of its assets.
 Pursuant to the programme, a portion of the fixed assets has been
 physically verified by the Management during the year and no material
 discrepancies between the book records and the physical inventory have
 been noticed.
 
 (c) In our opinion, and according to the information and explanations
 given to us, a substantial part of fixed assets has not been disposed
 of by the Company during the year.
 
 2.  (a) The inventory (excluding stocks with third parties) has been
 physically verified by the Management during the year.
 
 In respect of inventory lying with third parties, these have
 substantially been confirmed by them. In our opinion, the frequency of
 verification is reasonable.
 
 (b) In our opinion, the procedures of physical verification of
 inventory followed by the Management are reasonable and adequate in
 relation to the size of the Company and the nature of its business.
 
 (c) On the basis of our examination of the inventory records, in our
 opinion, the Company is maintaining proper records of inventory. The
 discrepancies noticed on physical verification of inventory as
 compared to book records were not material.
 
 3.  (a) The Company has not granted any loans, secured or unsecured, to
 companies, firms or other parties covered in the register maintained
 under Section 301 of the Act. Accordingly clauses (iii) (b), (c) and
 (d) of paragraph 4 of the order are not applicable in the case of the
 company in the current year.
 
 (b) The Company has not taken any loans, secured or unsecured, from
 companies, firms or other parties covered in the register maintained
 under Section 301 of the Act. Accordingly clauses (iii) (f) and (g) of
 paragraph 4 of the order are not applicable in the case of the Company
 in the current year.
 
 4.  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 for the
 purchase 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, no major weakness have been noticed or
 reported.
 
 5.  According to the information and explanations given to us, there
 have been no contracts or arrangements referred to in Section 301 of
 the Act during the year to be entered in the register required to be
 maintained under that Section. Accordingly, the question of commenting
 on transactions made in pursuance of such contracts or arrangements
 does not arise.
 
 6.  The Company has not accepted any deposits from the public within
 the meaning of Sections 58A and 58AA of the Act and the rules framed
 there under.
 
 7.  In our opinion, the Company has an internal audit system
 commensurate with its size and the nature of its business.
 
 8.  According to the information and explanations given to us, the
 company is in process of preparing the cost records prescribed by the
 Central Government under clause (d) of subsection (1) of Section 209 of
 the Act in respect of the products of the Company.
 
 9.  (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 undisputed statutory dues in respect
 of provident fund, employees'' state insurance, income tax, sales tax
 and service tax, though there has been a delay in a few cases, and is
 regular in depositing undisputed statutory dues, including investor
 education and protection fund, wealth tax, customs duty, excise duty,
 cess and other material statutory dues, as applicable, with the
 appropriate authorities.
 
 (b) According to the information and explanations given to us and the
 records of the Company examined by us, the particulars of dues of
 income tax, sales tax, wealth tax, service tax, customs duty and excise
 duty as at March 31, 2012 which have not been deposited on account of a
 dispute, are as follows:
 
 Annexure to Auditors'' Report
 
 Refferred to in paragraph 3 of the Auditors'' Report of even date to the
 members of ALSTOM Projects India Limited on the financial statements
 as of and for the year ended March 31, 2012
 
 Name of the statute                           Nature of dues
 
 Andhra Pradesh General Sales 
 Tax (GST), 1957;                Works Contract Tax on Inter State Sales
 
 Andhra Pradesh Value Added Tax 
 (VAT), 2005 and Central Sales 
 Tax (CST) Act, 1956
 
 Central Excise Act, 1944        Excise duty and penalty
 
 Central Sales Tax Act, 1956     Central Sales Tax Penalty
 
 Bombay Sales Tax Act, 1957 
 and Central Sales               Works Contract Tax on Inter State Sales
 Tax Act, 1956
 
 Orissa General Sales Tax Act,
 1947 and Central                Works Contract Tax on Inter State Sales
 Sales Tax Act, 1956
 
 Tamil Nadu General Sales Tax 
 Act,1959                        Sales Tax and Penalty
 
 Income Tax Act, 1961            Income Tax and Interest
 
 Labour Cess Act, 1966           Labour Cess on Cost of Construction
 
 Finance Act, 1994 (Service 
 Tax)                            Service Tax and Penalty
 
 
 
 
 
 Name of the statute           Amount   Period to which  Forum where 
                              (Rs.      the amount       dispute is 
                               Million) relates          pending 
 
 Andhra Pradesh General Sales 
 Tax (GST), 1957;                520.2  2004 - 2008      High Court
 
 Andhra Pradesh Value Added Tax 
 (VAT), 2005 and Central Sales 
 Tax (CST) Act, 1956
 
 
 Central Excise Act, 1944        251.5  1979 - 2008      CESTAT
 
 Central Sales Tax Act, 1956      14.2  1993 - 1999      Appellate 
                                                         Tribunal
 
 Bombay Sales Tax Act, 1957 
 and Central Sales                10.2  1984 - 1992      Appellate 
 Tax Act 1956                                            Tribunal
 
 
 Orissa General Sales Tax Act,
 1947 and Central                  3.6  1992 - 1997      High Court
 Sales Tax Act,1961
 
 
 Tamil Nadu General Sales Tax 
 Act,1959                          1.8  2004 - 2005      High Court
 
 Income Tax Act, 1961             82.4  Assessment 
                                        Years            CIT (Appeals)
                                        2007-2009
 
 Labour Cess Act, 1966            18.6  2010-2011        Assistant 
                                                         Labour
                                                         Comissioner
 
 Finance Act, 1994 (Service 
 Tax)                             86.1  2005-2009        CESTAT
 
 10.  The Company has no accumulated losses as at 31 March 2012 and it
 has not incurred any cash losses in the financial year ended on that
 date or in the immediately preceding financial year.
 
 11.  The Company neither has any borrowings from any financial
 institution or bank nor has it issued any debentures as at the balance
 sheet date.
 
 12.  The Company has not granted any loans and advances on the basis of
 security by way of pledge of shares, debentures and other securities.
 
 13.  The provisions of any special statute applicable to chit fund/
 nidhi/ mutual benefit fund/ societies are not applicable to the
 Company.
 
 14.  In our opinion, the Company is not a dealer or trader in shares,
 securities, debentures and other investments.
 
 15.  In our opinion, and according to the information and explanations
 given to us, the Company has not given any guarantee for loans taken by
 others from banks or financial institutions during the year.
 
 16.  The Company has not obtained any term loans.
 
 17.  On the basis of an overall examination of the balance sheet of the
 Company, in our opinion, and according to the information and
 explanations given to us, there are no funds raised on a short-term
 basis which have been used for long-term investment.
 
 18.  The Company has not made any preferential allotment of shares to
 parties and companies covered in the register maintained under Section
 301 of the Act during the year.
 
 19.  The Company has not issued any debentures during the year; and
 does not have any debentures outstanding as at the year end.
 
 20.  The Company has not raised any money by public issues during the
 year
 
 21.  During the course of our examination of the books and records of
 the Company, carried out in accordance with the generally accepted
 auditing practices in India, and according to the information and
 explanations given to us, we have neither come across any instance of
 material fraud on or by the Company, noticed or reported during the
 year, nor have we been informed of such case by the Management.
 
                                    For Price Waterhouse
 
                                    Firm Registration Number: 012754N
 
                                    Chartered Accountants
 
                                    Joy Kumar Jain
 
 Place: Noida                       Partner
 
 Date : April 23, 2012              Membership Number: 087659