1.  We have audited the attached Balance Sheet of Alumeco India
 Extrusion Limited (the Company) as at 30 June 2012, the Statement of
 Profit and Loss and the Cash Flow Statement for the year ended on that
 date, annexed thereto. 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 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 more fully explained in Note 2.24 of the financial statements,
 the Company has accumulated losses of  Rs.197,852,028 as at 30 June 2012
 which have exceeded the paid up capital and reserves (Rs.160,522,805) of
 the Company at that date. Also, the Company had made a reference to the
 Board for Industrial & Financial Reconstruction (BIFR) in terms of
 Section 15(1) of the Sick Industrial Companies (Special Provisions)
 Act, 1985 and had been declared sick on 9 February 2010. It is
 currently in the process of working out a rehabilitation scheme with
 the BIFR.
 
 Considering the financial position of the Company as at 30 June 2012,
 there exists uncertainty as to whether the Company will be able to
 continue as a going concern.  However, based on its ongoing efforts to
 improve the performance, management believes that the Company will be
 able to generate cash flows sufficient to meet its liabilities in the
 near future. Accordingly, the financial statements for the year ended
 30 June 2012 have been prepared on a going concern basis and do not
 include any adjustments relating to the recoverability and
 classification of recorded asset amounts, or, to amounts or
 classification of liabilities that may be necessary if the Company is
 unable to continue as a going concern.
 
 4.  As more fully explained in Note 2.40 of the financial statements,
 during the year ended 30 June 2012 and 30 June 2011, the Company has
 accrued for managerial remuneration, which exceeds the limits specified
 in Schedule XIII to the Companies Act, 1956 (''the Act'')to the extent of
 Rs. 9,083 and Rs.143,856 respectively. The Company has applied for Central
 Government of India''s approval for the same, which is pending as at the
 date of our report. Pending the receipt of such an approval, such
 excess remuneration has not been paid.
 
 5.  As required by the Companies (Auditor''s Report) Order, 2003 (the
 Order), as amended, issued by the Ministry of Corporate Affairs in
 terms of sub-section (4A) of Section 227 of the Act, we enclose in the
 Annexure a statement on the matters specified in paragraphs 4 and 5 of
 the said Order.
 
 6.  Further to our comments in the Annexure referred to in paragraph 5
 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 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 Balance Sheet, the Statement of Profit and Loss
 and the 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 at 30 June 2012, and taken on record by the Board of Directors, we
 report that none of the Director is disqualified as at 30 June 2012
 from being appointed as a Director in terms of clause (g) of
 sub-section (1) of Section 274 of the Act, on the said date; and
 
 (f) except for the effects of the matters described in paragraph 3 and
 4 above, in our opinion and to the best of our information and
 according to the explanations given to us, the said accounts, 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:
 
 a.  in the case of the Balance Sheet, of the state of affairs of the
 Company as at 30 June 2012;
 
 b.  in the case of the Statement of Profit and Loss, of the loss of the
 Company for the year ended on that date; and
 
 c.  in the case of the Cash Flow Statement, of the cash flows of the
 Company for the year ended on that date.
 
 ANNEXURE TO THE AUDITORS'' REPORT
 
 The Annexure referred to in the Auditors'' report to the members of
 Alumeco India Extrusion Limited (the Company) on the financial
 statements for the year ended 30 June 2012. We report that:
 
 (i) (a) The Company has maintained proper records showing full
 particulars, including quantitative details and situation of fixed
 assets.
 
 (b) The Company has a regular programme of physical verification of its
 fixed assets by which all fixed assets are verified annually. In our
 opinion, this periodicity of physical verification is reasonable having
 regard to the size of the Company and the nature of its assets. In
 accordance with the programme, all fixed assets were physically
 verified during the year. No material discrepancies were noticed on
 such verification.
 
 (c) Fixed assets disposed off during the year were not substantial, and
 therefore, do not affect the going concern assumption.
 
 (ii) (a) The inventory, except goods-in-transit, has been physically
 verified by the Management during the year. In our opinion, the
 frequency of such verification is reasonable.
 
 (b) The procedures for the 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) The Company has maintained proper records of inventory. The
 discrepancies noticed on verification between the physical stocks and
 the book records were not material.
 
 (iii) (a) The Company has neither granted nor 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
 (''the Act''). Accordingly, clauses 4(iii) (a) to 4 (iii) (g) of the
 Order are not applicable to the Company.
 
 (iv) In our opinion and according to the information and explanations
 given to us, and having regard to the explanation that purchases of
 certain items of inventories are for the Company''s specialised
 requirements and suitable alternative sources are not available to
 obtain comparable quotations, there is an adequate internal control
 system commensurate with the size of the Company and the nature of its
 business for purchase of inventories, services and fixed assets and for
 the sale of goods. The activities of the Company do not involve sale of
 services. We have not observed any major weakness in the internal
 control system during the course of the audit.
 
 (v) (a) In our opinion, and according to the information and
 explanations given to us, the particulars of contracts or arrangements
 referred to in Section 301 of the Act have been entered in the register
 required to be maintained under that Section.
 
 (b) In our opinion, and according to the information and explanations
 given to us, the transactions made in pursuance of contracts and
 arrangements referred to in (v)(a) above and exceeding the value of Rs. 5
 lakh with any party during the year are for the Company''s specialised
 requirements for which suitable alternative sources are not available
 to obtain comparable quotations. However, on the basis of information
 and explanations provided, the same appear reasonable.
 
 (vi) The Company has not accepted any deposits from the public.
 
 (vii) In our opinion, the Company has an internal audit system
 commensurate with the size and nature of its business.
 
 (viii) We have broadly reviewed the books of account maintained by the
 Company pursuant to the rules prescribed by the Central Government of
 India for maintenance of cost records under Section 209(l)(d) 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.
 
 (ix) (a) According to the information and explanations given to us and
 on the basis of our examination of the records of the Company, amounts
 deducted/ accrued in the books of account in respect of undisputed
 statutory dues including Provident Fund, Employees'' State Insurance,
 Income-tax, Sales-tax, Service tax, Customs duty, Excise duty and other
 material statutory dues have been generally regularly deposited during
 the year by the Company with the appropriate authorities though there
 has been a slight delay in a few cases. As explained to us, the Company
 did not have any dues on account of Investor Education and Protection
 Fund and Wealth Tax.  According to the information and explanations
 given to us, there are no undisputed amounts payable in respect of
 Provident Fund, Employees'' State Insurance, Income- tax, Sales- tax,
 Service tax, Customs duty, Excise duty and other material statutory
 dues that were in arrears as at 30 June 2012 for a period of more than
 six months from the date they became payable except for income tax
 amounting to Rs.3,015,288 which is outstanding for more than six months
 as at 30 June 2012. As explained to us, the Company did not have any
 dues on account of Investor Education and Protection Fund and Wealth
 Tax.
 
 (b) According to the information and explanations given to us, there
 are no dues of Service tax and Customs duty which have not been
 deposited with the appropriate authorities on account of any dispute.
 According to the information and explanations given to us, the
 following dues of Income tax, Sales tax and Excise duty have not been
 deposited by the Company on account of disputes:
 
 Name of the     Nature of      Amount     Period to 
                                           which the       Forum where
 Statute         the Dues        (Rs.)     amount relates  dispute is 
                                                           pending
 
 Central Excise  Interest and  49,064,648    2002-05       CESTAT,
 Act, 1944       Penalty 
                              (19,532,324)*                Bangalore
 
 Central Sales   Central        1,250,000    2001-02       High court,
 Tax Act,1956    Sales Tax     (1,000,000)*                Andhra Pradesh
 
 Central Sales   Central        3,943,021    2002-03       Appellate 
                                                           Deputy
 Tax Act, 1956   Sales Tax                                 Commissioner,
                                                           Hyderabad
 
 Central Excise  Interest and   6,037,966    2005-06       Appellate
                                                           Commissioner,
 Act, 1944       Penalty       (3,268,218)*                Hyderabad
 
 Central Sales   Central        8,685,252   Previous year  Additional
                                                           Deputy
 Tax Act,1956    Sales Tax                  2003-04 to 
                                            2005-06        Commissioner,
                                                           Hyderabad
 
 * The amounts in parenthesis represent the payment made under protest.
 
 (x) The accumulated losses at the end of the financial year amounting
 to Rs.197,852,028 have exceeded its networth aggregating to Rs.
 160,522,805. The Company has incurred cash losses in the current
 financial year.  However, no cash losses have been incurred in the
 immediately preceding financial year.
 
 (xi) The Company did not have any dues to any financial institution,
 banks or debenture holders during the year.
 
 (xii) The Company has not granted any loans and advances on the basis
 of security by way of pledge of shares, debentures and other
 securities.
 
 (xiii) In our opinion and according to the information and explanations
 given to us, the Company is not a chit fund /nidhi/ mutual benefit
 fund/ society.
 
 (xiv) According to the information and explanations given to us, the
 Company is not dealing or trading in shares, securities, debentures and
 other investments.
 
 (xv) 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.
 
 (xvi) In our opinion and according to the information and explanations
 given to us, the term loan taken by the Company in earlier years has
 been applied for the purpose for which they were raised.
 
 (xvii) According to the information and explanations given to us and on
 an overall examination of the balance sheet of the Company, we report
 that the short term funds amounting to Rs.101,546,466 have been used for
 long-term purposes.
 
 (xviii) The Company has not made any preferential allotment of shares
 to companies / firms / parties covered in the register maintained under
 Section 301 of the Act.
 
 (xix) The Company did not have any outstanding debentures during the
 year.
 
 (xx) The Company has not raised any money by public issues.
 
 (xxi) According to the information and explanations given to us, no
 fraud on or by the Company has been noticed or reported during the
 course of our audit.
 
                                                 for  B S R & Company
 
                                                Chartered Accountants 
 
                                  Firm''s registration number: 128032W
 
 Place: Hyderabad                                       Zubin Shekary
 
 Date: 29th August 2012                                       Partner
 
                                                Membership No: 048814