1.  We have audited the attached Balance Sheet of GLODYNE TECHNOSERVE
 LIMITED (the Company) as at 31st March, 2011 and related Profit and
 Loss Account and Cash Flow Statement of the Company 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 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 the 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 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
 (''the Act''), and on the basis the information and explanations given to
 us and books and records examined by us in the normal course of audit
 and to the best of our knowledge and belief we give in the Annexure a
 statement on the matters specifed in paragraphs 4 and 5 of the said
 Order.
 
 4.  Further to our comments in the annexure referred to 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 purpose of the
 audit;
 
 b) In our opinion, proper books of accounts as required by law have
 been kept by the Company, so far as appears from our examination of the
 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, to
 the extent applicable;
 
 e) On the basis of written representations received from the directors,
 as on 31st March, 2011 and taken on record by the Board of Directors,
 we report that none of the Directors is disqualified as on 31st March
 2011 from being appointed as a director in terms of clause (g) of
 sub-section (1) of section 274 of the Act; and
 
 f) 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 Act 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 31st March, 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 fows for the
 year ended on that date.
 
 [Referred to in paragraph (3) of our report of even date to the members
 of Glodyne Technoserve Limited]
 
 (i) (a) The Company has maintained proper records showing full
 particulars, including quantitative details and situation of fixed
 assets.
 
 (b) The fixed assets of the Company have been physically verifed by the
 Management during the year at regular intervals. In our opinion, the
 periodicity of verifcation is reasonable having regard to the size of
 the Company and the nature of its assets. As informed to us, no
 material discrepancies were noticed on such verifcation.
 
 (c) The fixed assets disposed off during the year were not substantial,
 and therefore, do not affect the going concern assumption.
 
 (ii) (a) As informed to us, the inventories have been physically
 verifed by the Management. In our opinion, the frequency of such
 verifcation is reasonable.
 
 (b) In our opinion and according to the information and explanations
 given to us, the procedures adopted by the Management for the physical
 verifcation of inventories 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 records of inventory, in our
 opinion and according to the information and explanations given to us,
 the Company has maintained proper records of inventory and no material
 discrepancies were noticed on physical verifcation of the stocks as
 compared to the book records.
 
 (iii) (a) The Company has granted unsecured loans to seven subsidiaries
 covered in the register maintained under Section 301 of the Act. The
 maximum amount involved during the year wasRs. 19,083.81 Lakhs and the
 year end balance of these loans was Rs. 18,858.61 Lakhs.
 
 (b) In our opinion and according to the information and explanations
 given to us, the rate of interest and other terms and conditions for
 the loans mentioned in para (iii) (a) above, are prima facie not
 prejudicial to the interest of the Company.
 
 (c) Since the loans mentioned in para (iii) (a) above are without any
 fixed repayment schedule, the question of examining the regularity of
 repayment of the Principal amount and interest thereon, does not arise.
 
 (d) For the same reasons given in para (iii) (c) above, the question of
 examining the overdue amount and commenting on the reasonableness of
 the steps taken by the Company for the recovery of such loans does not
 arise except for advances amounting to Rs. 46.55 Lakhs for which the
 provision for doubtful recovery has been made
 
 (e) In our opinion and according to information and explanations given
 to us, the Company has not taken any loan, secured or unsecured from
 any party covered in the register maintained under Section 301 of the
 Act. Hence clause 4(iii) sub clauses (f) and (g) of the said order are
 not applicable.
 
 (iv) In our opinion and according to the information and explanations
 given to us, there are adequate internal control procedures
 commensurate with the size of the Company and the nature of its
 business with regard to purchase of inventory and fixed assets and for
 sale of goods and services. Further, on the basis of our examination of
 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 weakness in the
 aforesaid internal control system.
 
 (v) (a) In our opinion and according to the information and
 explanations given to us, we are of the opinion that 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 such contracts or
 arrangements exceeding the value of Rupees five lakhs during the year,
 have been made at prices which are reasonable having regard to the
 prevailing market prices at the relevant time.
 
 (vi) In our opinion and according to the information and explanations
 given to us, the Company has not accepted deposits from the public
 during the year.
 
 (vii) The Company has appointed a frm of Chartered Accountants to carry
 out its internal audit function. In our opinion, internal audit system
 is commensurate with its size and nature of its business.
 
 (viii) According to the information and explanations given to us and to
 the best of our knowledge, the Central Government has not prescribed
 maintenance of cost records under clause (d) of sub-section (1) of
 Section 209 of the Act for the products/ services of the Company.
 
 (ix) (a) According to the information and explanations given to us and
 according to the books and records examined by us, in our opinion, the
 Company has been generally regular in depositing with the appropriate
 authorities undisputed statutory dues including Provident fund,
 Employee State Insurance, Value Added Tax (VAT), Service Tax, Income
 Tax and other material statutory dues applicable to it except certain
 instances of delays were noticed. According to the information and
 explanations given to us, there are no undisputed amounts payable in
 respect of such statutory dues which have remained outstanding as at
 31st March 2011 for a period of more than six months from the date they
 became payable.
 
 (b) According to the information and explanations given to us, there
 are no dues which have not been deposited on account of any dispute
 with the Statutory authorities, except Rs. 25.28 Lakhs, Rs. 15.43 Lakhs and
 Rs. 20.57 Lakhs being disputed Income Tax demands for Assessment Year
 2005-06, 2006-07 and 2007-08 respectively. All these demands being
 contested by the Company in appeals pending before the Commissioner
 (Appeals).
 
 (x) The Company neither has accumulated losses as at 31st March, 2011
 nor has it incurred any cash losses during the current financial year or
 in the immediately preceding financial year.
 
 (xi) Based on our audit procedures and on the basis of information and
 explanations given by management, we are of the opinion that the
 Company has not defaulted in repayment of its dues to any financial
 institution, bank or debenture holders.
 
 (xii) In our opinion and 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 share, debentures and other
 securities.
 
 (xiii) In our opinion and according to the information and explanation
 given to us, the Company is not a chit fund or a nidhi / mutual benefit
 fund /society
 
 (xiv) In our opinion and 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 given Guarantees to banks in respect of loans taken by two
 of its subsidiaries. In our opinion, the terms and conditions of such
 guarantees are prima facie not prejudicial to the interest of the
 Company.
 
 (xvi) In our opinion and according to the information and explanations
 given to us, the Company has applied the term loans for the purpose for
 which such loans were obtained.
 
 (xvii) Based on the information and explanations given to us and on an
 overall examination of the Balance Sheet of the Company, in our
 opinion, there are no funds raised on a short term basis which have
 been used for long term investment.
 
 (xviii) During the year under Audit, the Company has issued Convertible
 warrants amounting to Rs. 1,080 Lakhs to one of the Companies covered in
 the register maintained under section 301 of the Act. In our opinion
 and according to the information and explanations given to us, the
 price at which the said warrants have been issued is not prejudicial to
 the interest of the Company.
 
 (xix) As the Company has not issued any debentures, question of
 commenting on the securities created in respect thereof does not arise.
 
 (xx) The Company has not raised any money by public issue during the
 year. Accordingly clause 4(xx) of the Order is not applicable.
 
 (xxi) During the course of our examination of the books of account and
 records of the Company carried out in accordance with the generally
 accepted auditing practices in India, we have not come across any
 instance of fraud on or by the Company, noticed or reported during the
 year, nor have we been informed of such case by the Management.
 
                                        For N M Kapadia & Co
 
                                       Chartered Accountants 
                                               FRN : 107072W
 
                                           Nilesh M. Kapadia
 
                                                     Partner
 
                                        Membership No.033697 
 Place : Mumbai 
 Date : August 5, 2011