1.  We have audited the attached Balance Sheet of Kaweri Telecom
 Products Limited as at 31 st March, 2011, the Profit and Loss Account
 and also 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 the 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
 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) issued by Central Government of India in terms of sub-section
 (4A)of Section 227 of the Companies Act, 1956, we enclose in the
 Annexure a statement on the matters specified in paragraphs 4 and 5 of
 the said Order.
 
 4.  Further to 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 purposes of our
 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
 those books;
 
 c.  The Balance Sheet, Profit and Loss Account and Cash Flow 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
 Companies Act, 1956.
 
 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, 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 (I) of Section 274 of the Companies Act, 1956;
 
 f.  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 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 31 st 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 flows for the
 year ended on that date.
 
 ANNEXURE TO AUDITOR''S REPORT OF KAWERI TELECOM PRODUCTS LIMITED
 Referred to in Paragraph 3 of our report of even date
 
 1.  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
 fixed assets which, in our opinion, is reasonable having regard to the
 size of the Company and the nature of its assets. In accordance with
 this programme, certain fixed assets were physically verified by the
 management during the year and we are informed that no material
 discrepancies were noticed on such verification.
 
 c.  In our opinion,there was no substantial disposal of fixed assets by
 the Company during the year.
 
 2.  a.  The management has conducted physical verification of inventory
 at reasonable intervals during the year.
 
 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.  The Company has maintained proper records of inventory and as
 explained to us, no material discrepancies were noticed on physical
 verification of inventory as compared to the book records.
 
 3.  a.  As informed,the Company has granted unsecured loan to one
 company covered in the register maintained under Section 301 of the
 Companies Act, 1956 during earlier year. The maximum amount involved
 during the year was Rs. 132.866 Million (Previous Year Rs.  122.25
 Million) and the year-end balance was Rs. 110.76 Million (Previous Year
 Rs. 111.41 Million). However, the Company has not granted any loan,
 secured or unsecured, to firms or other parties covered in the register
 maintained under Section 301 of the Companies Act, 1956.
 
 b.  In our opinion and according to the information and explanations
 given to us, the rate of interest and other terms and conditions on
 which such loan has been granted are not prima facie prejudicial to the
 interest of the Company.
 
 c.  The receipt of the principal amount and interest are in accordance
 with the terms and conditions of such granted loan.
 
 d.  There are no overdue amounts due from such party.
 
 e.  The company has not taken any loan secured/unsecured from
 companies, firms or other parties covered in the register maintained
 under section 301 of the Companies Act, 1956, except that the opening
 balance of the loans accepted during earlier year were repaid during
 the year and hence provisions of sub-clause (e) to (g) of clause (iii)
 of the order are not applicable.
 
 4.  In our opinion and according to the information and explanations
 given to us, there are adequate internal control systems commensurate
 with the size of the Company and nature of its business with regard to
 the purchase of inventory and fixed assets and with regard to the sale
 of goods and services. During the course of our audit, no major
 weakness has been noticed in the internal control system in respect of
 these areas.
 
 5.  a.  In our opinion and according the information and explanations
 given to us, the transactions made in pursuance 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
 section 301 of the Companies Act, 1956.
 
 b. In our opinion and according to the information and explanations
 given to us, the transactions made in pursuance of contracts or
 arrangements entered in the register maintained under section 301 of
 the Companies Act, 1956 and exceeding value of rupees five lakhs 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 except that reasonableness could not be ascertained where
 comparable quotations are not available having regard to the
 specialized nature of some of the transactions of the Company.
 
 6.  The Company has not accepted any deposits from the public and hence
 provisions of para (vi) of the said order (as amended) are not
 applicable.
 
 7.  In our opinion, the Company has an internal audit system
 commensurate with the size of the Company and nature of its business.
 
 8.  As explained to us, the Central Government has not prescribed the
 maintenance of Cost Records under Section 209( I )(d) of the Companies
 Act, 1956.
 
 9.  a.  According to the information and explanations given to us and
 books and records produced by the company and examined by us, in our
 opinion, the undisputed statutory dues including Provident Fund,
 Investor Education and Protection Fund, Employees'' State Insurance,
 Sales Tax,Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess
 wherever applicable and other material statutory dues have been
 generally regularly deposited with the appropriate authorities. However
 we have observed delays in remittance of IncomeTax, DividendTax.
 
 b.  According to the information and explanations given to us, no
 undisputed amounts payable in respect of Income Tax, Sales Tax,Wealth
 Tax, Service Tax, Customs Duty, Excise Duty and cess were in arrears as
 at 31 st March 2011 for a period more than six months from the date
 they became applicable.
 
 c.  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, and cess which have not been deposited with
 appropriate authorities on account of any dispute except for the
 following: appropriate authorities on account of any dispute except for
 the following:
 
 Name of the  Nature of Dues   Amount  Period to which  Forum where
 statute                       (Rs.in
                             Million)  amount relates  dispute is pending
 
 Central 
 Excise       Availment of    298.96  February 2007 to  CESTAT Bangalore
              cenvat credit              April 2008
 
 Sales Tax    Kate of tax 
              levied            6.32     2007-08 to
                                          2009-10       Commissioner of
                                                       Sales Tax appeals 
                                                        Bangalore
 
 10. The company has no accumulated losses and has not incurred any cash
 losses during the financial year covered by our audit and in the
 immediately preceding financial year.
 
 11. In our opinion and according to the information and explanations
 given to us,the Company has not defaulted in repayment of dues to
 financial institutions or banks.The company has no debenture holders.
 
 12. In our opinion and according to the information and explanations
 given to us, the Company has not granted any loan or advance. on the
 basis of security by way of pledge of shares, debentures and other
 securities.
 
 13. In our opinion, the Company is not a chit fund or a nidhi/mutual
 benefit fund/society. Therefore the provisions of clause 4(xiii) of the
 Companies (Auditor''s Report) Order 2003 (as amended) are not applicable
 to the Company.
 
 14. In our opinion, the Company is not dealing in or trading in shares,
 securities, debentures and other investments except those investments,
 which are held as investments. Accordingly, the provisions of clause
 4(xiv) of the Companies (Auditor''s Report) Order, 2003 (as amended) are
 not applicable to the company.
 
 15.  According to the information and explanations given to us, the
 Company has given guarantees for loans taken from banks by a subsidiary
 company and prima facie, the terms and conditions on which such
 guarantees have been extended are not prejudicial to the interest of
 the Company.
 
 16. According to the information and explanations given to us, term
 loans availed by the Company were, prima facie, utilized by the company
 for the purposes for which the loans were obtained.
 
 17. According to the information and explanations given to us and on an
 overall examination of the Balance Sheet of the company, we report that
 no funds raised on short-term basis have been used for long-term
 investments.
 
 18. During the year, the company has not made preferential allotment of
 shares to parties covered in the register maintained under section 301
 of the Companies Act, 1956 except in the case of three parties to whom
 shares and convertible warrants have been allotted on a preferential
 basis and in our opinion. the price at which the shares and convertible
 warrants have been issued is not prejudicial to the interest of the
 Company.
 
 19. During the year, the Company has not issued debentures and hence
 the provisions of clause (xix) of para 4 of this order (as amended) are
 not applicable.
 
 20. The company has not raised any money by way of public issue during
 the year and hence the provisions of clause (xx) of Para 4 of this
 order (as amended) are not applicable.
 
 21. During the course of our examination of the books of account
 carried out in accordance with the generally accepted auditing practice
 in India and according to the information and explanations given to us,
 we have neither come across any instance of fraud on or by the company
 noticed or reported during the year nor we have been informed of such
 case by the management.
 
 
                                         For S.Janardhan & Associates
 
                                                Chartered Accountants
 
                                                              B.Anand
 
 Partner
 
 Membership No.:29146
 
 Firm Registration No:-00531 OS
 
 Place: Bangalore,
 
 Date: May 30,2011