1.  We have audited the attached Balance Sheet of GODREJ CONSUMER
 PRODUCTS LIMITED as at March 31, 2011 and also the Proft and Loss
 Account and the Cash Flow Statement of the Company 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 signifcant 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, issued
 by the Central Government of India in terms of section 227 (4A) of the
 Companies Act, 1956, we annex hereto a statement on the matters
 specifed in paragraphs 4 and 5 of the said Order.
 
 4.  As stated in Note 3, Schedule 16: Notes to Accounts, Godrej
 Household Products Ltd. (GHPL), an erstwhile 100% subsidiary of Godrej
 Consumer Products Limited (GCPL) was amalgamated on March 31, 2011,
 with GCPL with effect from April 1, 2010, in accordance with a Scheme
 of Amalgamation sanctioned by the Honble High Court of Judicature at
 Bombay. These financial statements include the financial statements of
 the erstwhile GHPL for the year ended March 31, 2011, which have not
 been audited by us and have been audited by another auditor whose
 report has been furnished to us. Our opinion on the financial
 statements, to the extent they have been derived from the financial
 statements of the erstwhile GHPL, is based solely on the report of the
 other auditor.
 
 5.  Without qualifying our opinion, attention is drawn to Note 3,
 Schedule 16: Notes to Accounts, regarding the Scheme of Amalgamation
 approved by The Honble High Court of Judicature at Bombay whereby the
 assets and liabilities of the erstwhile Godrej Household Products
 Limited have been taken over and recorded at their fair values as on
 April 1, 2010, as determined by the Board of Directors of the Company.
 In accordance with the Scheme of Amalgamation, an amount of Rs. 3776.83
 lac on account of fair valuation of loans and advances, an amount of Rs.
 5275.00 lac on account of brand amortization and an amount of Rs. 614.42
 lac on account of costs and expenses of amalgamation aggregating to Rs.
 9666.25 lac has been charged to General Reserve instead of charging the
 same to the Proft and Loss Account. Had this amount been charged to the
 Proft and Loss Account, the proft for the year would have been lower by
 Rs. 9666.25 lac and the General Reserve would have been higher by Rs.
 9666.25 lac
 
 6.  Further to our comments in the Annexure referred to in para 3 above
 and our comments in para 4 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 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 such
 books.
 
 c) The Balance Sheet, Proft 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, the Proft 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 211 of
 the Companies Act, 1956.
 
 e) In our opinion and to the best of our information and according to
 the explanations given to us, the said accounts read 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 March 31, 2011;
 
 ii) in the case of the Proft and Loss Account, of the proft of the
 Company for the year ended on that date; and
 
 iii) in the case of the Cash Flow Statement, of the cash flows of the
 Company for the year ended on that date.
 
 7. On the basis of the written representations received from the
 Directors as on March 31, 2011 and taken on record by the Board of
 Directors, we report that none of the Directors is disqualifed 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 Companies Act, 1956.
 
 Annexure to the Auditors Report
 
 As required by the Companies (Auditors Report) Order, 2003, issued by
 the Central Government of India in terms of section 227 (4A) of the
 Companies Act, 1956, we further report that:
 
 1.  Fixed Assets:
 
 a) The Company has maintained proper records showing full particulars,
 including quantitative details and situation of fxed assets.
 
 b) The Company has a program for physical verifcation of fxed assets at
 periodic intervals. In our opinion, the period of verifcation is
 reasonable having regard to the size of the Company and the nature of
 its assets. The discrepancies reported on such verifcation are not
 material and have been properly dealt with in the books of account.
 
 c) In our opinion, there have been no signifcant disposals of fxed
 assets during the year which affect the going concern assumption.
 
 2.  Inventory:
 
 a) The Management has conducted physical verifcation of inventory
 (excluding stocks lying with third parties) at reasonable intervals. In
 respect of inventory lying with third parties, these have substantially
 been confrmed by them. In our opinion, the frequency of verifcation is
 reasonable.
 
 b) The procedures of physical verifcation 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 is maintaining proper records of inventory and no
 material discrepancies were noticed on verifcation between the physical
 stocks and the book records.
 
 3.  Loans and Advances:
 
 a) The Company had granted unsecured loans to two companies listed in
 the register maintained under section 301 of the Companies Act, 1956.
 The maximum amount involved during the year was Rs. 1586.73 lac and the
 closing balance amounted to Rs. Nil. The erstwhile Godrej Household
 Products Limited had granted an unsecured loan, to a party covered in
 the register maintained under Section 301 of the Act. The maximum
 amount involved during the year was Rs. 257.14 lac and the year-end
 balance was Rs. 214.29 lac.
 
 b) In our opinion, the rate of interest and other terms and conditions
 on which the unsecured loans have been granted to companies / parties
 listed in the register maintained under section 301 of the Companies
 Act, 1956, are not prima facie prejudicial to the interest of the
 Company.
 
 c) The parties to whom the Company had granted loans have repaid / are
 repaying the principal amounts as stipulated and have also been regular
 in the payment of interest.
 
 d) There is no overdue amount of loans granted to companies / parties
 listed in the register maintained under section 301 of the Companies
 Act, 1956.
 
 e) The Company has not taken any loans, secured or unsecured, from
 companies, frms 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
 purchases of inventory, fxed assets and for the sale of goods and
 services. During the course of our audit, we have not observed any
 continuing failure to correct major weaknesses in the internal control
 system.
 
 5.  Transactions that need to be entered in the register maintained
 under section 301 of the Companies Act, 1956:
 
 a) Based upon the audit procedures applied by us 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 Companies Act, 1956, 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 entered in the register maintained under section 301 of
 the
 
 Annexure to the Auditors Report
 
 Companies Act, 1956 and exceeding the value of Rs. 5.00 lac in respect of
 any party during the year, have been made at prices which are
 reasonable, having regard to prevailing market prices at the relevant
 time.
 
 6.  In our opinion and according to the information and explanations
 given to us, the Company has not accepted any deposits from the public
 within the meaning of section 58A, 58AA, or any other relevant
 provisions of the Companies Act, 1956 and the rules framed there under.
 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.
 
 7.  In our opinion, the Company has an internal audit system
 commensurate with the size of the Company and nature of its business.
 
 8.  We have broadly reviewed the books of account and records
 maintained by the Company in respect of manufacture of soaps, cosmetics
 and toiletries pursuant to the Rules made by the Central Government for
 maintenance of cost records, under section 209(l)(d) of the Companies
 Act, 1956 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. To the best of our
 knowledge and according to the information given to us, the Central
 Government has not prescribed maintenance of cost records under section
 209(1)(d) of the Companies Act, 1956, for any other products of the
 Company.
 
 9.  Statutory Dues
 
 a) According to the information and explanation given to us, the
 Company is regular in depositing undisputed statutory dues, including
 dues pertaining to Investor Education and Protection Fund, Provident
 Fund, Employees State Insurance, Income-tax, Sales-tax, Wealth Tax,
 Service Tax, Custom Duty, Excise duty, Cess and any other statutory
 dues with the appropriate authorities. We have been informed that there
 are no undisputed dues which have remained outstanding as at the end of
 the financial year, 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 of income-tax, sales tax, wealth tax, service tax, customs
 duty, excise duty or cess outstanding on account of any dispute, other
 than the following:
 
 Name of Statute            Nature of Dues                  Amount
 
                                                            Rs. lac
 
 Central Excise Act,    Rate differences on account of      61.54
 1944                   soap scrap.
 
                        Cenvat credit availed on input      10.81
                        services.
 
                        Excise duty claim in respect       118.27
                        of non payment of education
                        cess.
 
                        Others                              21.94
 
                        Excise duty in dispute              18.43
                        pertaining to erstwhile Godrej
                        Household Products Limited.
 
 Sales Tax Act          Interest on sales tax dues.         12.07
 
                        Sales Tax Dues                     106.41
 
                        Sales Tax Dues                      17.58
 
                        Others                              28.62
 
                    Sales tax in dispute pertaining         31.70
                    to erstwhile Godrej Household
                      Products Limited.                     66.00
 
                                                           502.78
 
                                                            29.83
 
                                                            89.52
 
                                                          1044.43
 
                                                            44.11
 
 The Entry Tax Act.    Entry Tax in dispute pertaining     105.95
                       to erstwhile Godrej Household
                       Products Limited.                    22.67
 
 The Finance Act,      Service  Tax  in   dispute           16.21
 1994.                 pertaining to erstwhile Godrej
                       Household Products Limited.
 
 Employees            Provident  Fund  in    dispute      252.95
 Provident Funds       pertaining to erstwhile Godrej
 and Miscellaneous       Household Products Limited.
 Provisions Act, 1952.
 
 Income-tax Act, 1961  Appeal against order of regular     322.71
                       assessment u/s 143(3) of the
                       Act.
 
                       Demand based on the order of         34.91
                       regular assessment u/s 143(3)
                       of the Act.
 
                       Demand based on the order of         77.56
                       regular assessment u/s 143(3)
                       of the Act.
                       Others                              402.26
 
                       Income-tax        in     ispute      60.72
 
                        pertaining to erstwhile Godrej     267.63
 
                      Household Products Limited.         106.22
 
 Name of status       Period to which the   Forum where dispute is 
                        amount release           pending
 
 
 Central Excise Act,    2000 - 04          CESTAT
 1944
 
                         2009-10           Commissioner of Central 
                                            Excise(Appeal)
 
                         2004-08           Assistant Commissioner
 
                         1996-99           Assistant Commissioner
 
                         2007-08           CESTAT
 
                         2002-03, 
                         2006-07           Commissioner of Central 
                                           Excise
                                           (Appeals), Chennai
 
 Sales Tax Act           2001-02           High Court
 
                         2004-05           Sales Tax Authority
 
                         2009-10           Joint Commissioner (A)
 
                         2000-01           Assistant / Joint/ Deputy
 
                         2002-03           Commissioner
 
                         2007-08           Sales Tax Authority
 
                         2003-04
 
                         2005-08
 
                         2009-10
 
 
                       Financial Years 
                         2002-03,          Supreme Court of India
                    2003-04 and 2004-05
 
                   Financial Year 2004-05  Commercial Tax Offcer 
                                           (West Bengal)
 
                   Financial Years 1998-99,Deputy Commissioner 
                                            Commercial
 
                   1999-00, 2001-02, 2002   Taxes (Uttar Pradesh) 
                                            and Deputy
 
                     03, 2003-04, 2004-05,  Commissioner Appeals 
                                             (West Bengal,
 
                     2005-06, 2006-07 and   Maharashtra, Uttar
                                            Pradesh, Andhra
 
                          2007-08.          Pradesh, Punjab, Orissa, 
                                             Haryana,Jammu and Kashmir)
 
                  Financial Years 2001-02, Joint Commissioner (Appeals) 
                                           (Uttar
                  2002-03, 2003-04, 2006-  Pradesh, Orissa, Andhra 
                                           Pradesh and
                     07 and 2008-09        Tamil Nadu)
 
                  Financial Years 1994-95, Sales Tax Tribunal (Bihar, 
                                           Uttar
                  1999-00, 2000-01, 2001-  Pradesh, Delhi, West Bengal,
                  02, 2002-03 and 2003-04  Karnataka)
                  Financial Years 1999-00, High Court (Andhra Pradesh,
                  2000-01, 2001-02, 2004-  Madhya Pradesh, Kerala, 
                                           Rajasthan,
                    05, 2005-06, 2006-07,  Karnataka)
                     2007-08 and 2008-09
 
                  Financial Years 2003-04  Commissioner (Appeals) 
                                          (Andhra
                        and 2004-05        Pradesh, Bihar, Maharashtra)
 
 The Entry Tax    Financial Years 2006-07  Supreme Court of India
 Act                     and 2007-08
 
                 Financial Years 1999-2000 Commissioner (Appeals) 
                                           (Madhya
                      to 2003-04            Pradesh)
 
 The Finanacial    September 2004 to       Commissioner (Appeals)
 Act 1994          November 2004 and
                   February 2005 to June
                          2008
 
 Employees     Financial Years 2005-06 to Employees Provident Fund 
 Provident Funds                                   Appellate
 and                        2009-10           Tribunal, New Delhi.
 Miscellaneous
 Provisions
 Act 1952
 
 Income tax
 Act, 1961        Assessment Year 2006-07  CIT(A)
 
                  Assessment Year 2008-09  AO
 
                  Assessment Year 2009-10  AO
 
                  Assessment Year 2003-04  CIT (A)
                          2006-07
                          2007-08
 
                  Assessment Year 2003-04  Assessing Offcer
 
                  Assessment Year 2006-07  Income-tax Appellate Tribunal
 
                  Assessment Year 2007-08  Commissioner of Income-tax
                                           (Appeals)
 
 10.  The Company does not have accumulated losses as at the end of the
 financial year, nor has it incurred cash losses in the current financial
 year, or in the immediately preceding financial year.
 
 11.  According to the information and explanations given to us and
 based on the documents and records produced before us, there has been
 no default in repayment of dues to banks or debenture holders. There
 are no dues to financial institutions.
 
 12.  According to the information and explanations given to us and
 based on the documents and records produced before us, the Company has
 not granted any loans or advances on the basis of security by way of
 pledge of shares, debentures or other securities.
 
 13.  In our opinion and according to the information and explanations
 given to us, the nature of activities of the Company does not attract
 any special statute applicable to chit fund and nidhi / mutual benefit
 fund / societies.
 
 14.  The Company does not deal or trade in shares, securities,
 debentures and other investments.
 
 15.  According to the information and explanations given to us and the
 records examined by us, the terms and conditions of guarantees given by
 the Company for loans taken by its subsidiaries from banks are not
 prima facie prejudicial to the interest of the Company.
 
 16.  According to the information and explanations given to us and the
 records examined by us, on an overall basis, the term loan obtained by
 the Company was applied for the purpose for which the loan was
 obtained.
 
 17.  According to the information and explanations given to us and on
 an overall examination of the Balance Sheet, the Cash Flow Statement
 and other records examined by us, the Company has used funds raised on
 short term basis for long term investment. The Company has used short
 term borrowings to the extent of Rs. 6993.26 lac for the acquisition of
 long term investments.
 
 18.  The Company has not made any preferential allotment of shares to
 any parties or companies covered in the register maintained under
 section 301 of the Companies Act, 1956.
 
 19.  The Company has issued unsecured redeemable non-convertible
 debentures during the year in respect of which no security is required
 to be created.
 
 20.  The Company has not raised any money through a public issue during
 the year.
 
 21.  Based upon the audit procedures performed by us, to the best of
 our knowledge and belief and according to the information and
 explanations given to us by the Management, no fraud on, or by the
 company, has been noticed or reported during the year.
 
 For and on behalf of
 
 KALYANIWALLA & MISTRY
 
 CHARTERED ACCOUNTANTS 
 
 Firm Regn. No.: 104607W
 
 Daraius Z. Fraser
 
 PARTNER
 
 M. No.: 42454 
 
 Mumbai: May 2, 2011.