1.  We have audited the attached Balance Sheet of Coromandel
 International Limited (the Company), as at March 31, 2011, and the
 related Profit and Loss Account and the 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 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 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 (Auditors Report) Order, 2003, as
 amended by the Companies (Auditors 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 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, Profit and Loss Account and Cash Flow Statement
 dealt with by this report are in agreement with the books of account;
 
 (d) In our opinion, the Balance Sheet, Profit and Loss Account 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, 2011 and taken on record by the Board of
 Directors, none of the directors is disqualified as on March 31, 2011
 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, 2011;
 
 (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 AUDITORS REPORT
 [Referred to in paragraph 3 of the Auditors Report of even date to the
 members of Coromandel International Limited on the financial statements
 for the year ended March 31, 2011]
 
 1.  (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
 off 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.  The Company has neither granted nor taken any loans, secured or
 unsecured, to/from companies, firms or other parties covered in the
 register maintained under Section 301 of the Act.
 
 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, 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 system.
 
 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.  In our opinion and according to the information and explanations
 given to us, the Company has complied with the directives issued by
 Reserve Bank of India and the provisions of Sections 58A and 58AA or
 any other relevant provisions of the Act and the Companies (Acceptance
 of Deposits) Rules, 1975 with regard to the deposits accepted in
 earlier years from the public. According to the information and
 explanations given to us, 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 on the Company in respect of the aforesaid
 deposits.
 
 7.  In our opinion, the Company has an internal audit system
 commensurate with its size and nature of its business.
 
 8.  We have broadly reviewed the books of account maintained by the
 Company in respect of products where, pursuant to the Rules made by the
 Central Government of India, the maintenance of cost records has been
 prescribed under clause (d) of sub-section (1) of Section 209 of the
 Act and are of the opinion that prima facie, the prescribed accounts
 and records have been made and maintained. We have not, however, made a
 detailed examination of the records with a view to determine whether
 they are accurate or complete.
 
 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 regular in depositing the undisputed statutory dues
 including provident fund, investor education and protection fund,
 employees state insurance, income-tax, sales tax, wealth tax, service
 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, there are no dues of income-tax,
 wealth tax and customs duty which have not been deposited on account of
 any dispute. The particulars of dues of sales-tax, service tax, excise
 duty and cess as at March 31, 2011 which have not been deposited on
 account of dispute are as follows:
 
 Name of the Nature of Dues Amount  Years to which  Forum where the
 
 Statute                    (Rs. in 
                             Lakhs)  they relate    dispute is pending
 
 Karnataka   Turnover Tax on 
             chemical mixture  8.33   1993-1994 to  Sales Tax Appellate 
                                                        Tribunal
 Sales tax 
 Act,         fertilizers             1996-1997
 1957
 
 Andhra 
 Pradesh     Sales tax on 
             scrap sales, 
               Taxable        115.32  1995-1996      Appellate Deputy 
                                                     commissioner Sales
 General 
 Sales Tax  turnover/Tax 
            on stock 
            transfer/Tax                  to         Tax, Sales Tax 
                                                     Appellate Tribunal
                                                     /Joint
 Act, 1957  on Government of 
            India Subsidy/            2005-2006      Commissioner of 
                                                     Commercial Taxes/
            Lease rentals/
            Set-offs                                 Commercial tax 
                                                     Officer/Assistant
                                                     Commissioner (CT)
 
 West 
 Bengal     Disallowance of 
            tax adjustment,     3.90  2002-2003      Assistant 
                                                     Commissioner 
                                                    (Appeals),
 Sales Tax 
 Act,       surcharge and 
            penalties                                West Bengal
 1994
 
 Tamil Nadu Disallowance on 
            Stock Transfers     0.98  2001-2002      Sales Tax Appellate 
                                                     Tribunal
 General 
 Sales Tax
 Act, 1959
 
 Electricity 
 Supply      Cess on 
             generation       155.06  2003-2004 to   Honble High Courts 
                                                     of Madras and
 Act, 1948   of electricity           2008-2009      Andhra Pradesh
 
 Central 
 Excise      Disallowance/
             demands          501.33  1999-2003      Commissioner 
                                                     (Appeals)/Customs,
 Act, 1944   relating to  
             excise duty                             Excise, Service 
                                                     Tax Appellate
                                                     Tribunal and Honble 
                                                     High Courts of
                                                     Andhra Pradesh 
                                                     and Mumbai
 
 The Customs Penalty on 
             customs duty      10.84   1998-1999     Customs, Excise, 
                                                     Service Tax
 Act, 1962                                           Appellate Tribunal,  
                                                     Mumbai
 
 Orissa 
 VAT Act,    Disallowance 
             of input tax 
             credit             11.3    2005-2009    Additional 
                                                     Commissioner of
 2004                                                Commercial Tax
 
 UP VAT Act  Disallowance of    29.27   2005-2008 to Additional 
                                                     Commissioner of
             exemption benefit          2010-2011    Commercial Taxes 
                                                     and Appellate
                                                     Tribunal
 
 10.  The Company has no accumulated losses as at March 31, 2011 and it
 has not incurred any cash losses in the financial year ended on that
 date or in the immediately preceding financial year.
 
 11.  According to the records of the Company examined by us and the
 information and explanations given to us, the Company has not defaulted
 in repayment of dues to any financial institution or bank or debenture
 holders 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 terms and conditions of the guarantees given by the
 Company, for loans taken by others from banks or financial institutions
 during the year, are not prejudicial to the interest of the Company.
 
 16.  In our opinion, and according to the information and explanations
 given to us, on an overall basis, the term loans have been applied for
 the purposes for which they were obtained.
 
 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 raised any money by public issues during the
 year.
 
 20.  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.
 
 21.  The other clauses, (iii)(b), (iii)(c), (iii)(d), (iii)(f),
 (iii)(g), (v)(b) and (xix) of paragraph 4 of the Companies (Auditors
 Report) Order 2003, as amended by the Companies (Auditors Report)
 (Amendment) Order, 2004, are not applicable in the case of the Company
 for the current year, since in our opinion there is no matter which
 arises to be reported upon under the aforesaid order.
 
                                                    For Price Waterhouse
 
                                        Firm Registration Number 007568S 
                                                   Chartered Accountants
 
                                                           Anupam Dhawan
 
 Place : Hyderabad                                               Partner
 
 Date  : April 21, 2011                           Membership No. F-84451