1.  We have audited the attached Balance Sheet of KOPRAN LIMITED (''the
 Company'') as at 31st March 2011 and also the Profit 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 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 misstatements. 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 the Companies (Auditor''s Report) (Amendment) Order, 2004
 (together the said Order) issued by the Central Government of India in
 terms of sub-section (4A) of Section 227 of the Companies Act, 1956 and
 on the basis of such checks as we considered appropriate, and according
 to the information and explanations given to us, we enclose 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 and the Profit and Loss Account dealt with by this
 report are in agreement with the books of account;
 
 d) In our opinion, the Balance Sheet, the Profit and Loss Account and
 Cash Flow Statement dealt with by this report comply with all
 Accounting Standards referred to in section 211 (3C) of the Companies
 Act, 1956.
 
 e) According to the information and explanation given to us and on the
 basis of written representation received from the Directors of the
 Company, 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 under clause (g) of
 sub-section (1) of Section 274 of the Companies Act, 1956.
 
 f) Attention is invited to Note 9 of Schedule 18 regarding Investment
 and Advances aggregating Rs. 500.61 lakhs and Rs. 4882.62 lakhs
 respectively, given to a subsidiary company, Kopran Research
 Laboratories Limited whose accumulated losses have exceeded the
 net-worth, no provision for Investments and Doubtful advances has been
 made by the management of the Company. Consequently, the effect, if
 any, on the carrying values of investments and advances given are
 currently unascertainable. Our audit report on the financial statements
 for the year ended 31st March, 2010 was also modified in respect of the
 matter stated above.
 
 g) Subject to our comments in Para 4(f) above, 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 Significant Accounting
 Policies and other 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 31st March, 2011.
 
 ii) In the case of the Profit and Loss Account, of the Profit for the
 year ended on that date.
 
 iii) In the case of the cash flow statement of the cash flows for the
 year ended on that date.
 
 ANNEXURE TO THE AUDITORS'' REPORT
 
 (Referred to in Paragraph 3 of our report of even date to the Members
 of Kopran Limited on the accounts for the Year ended March, 31 2011)
 
 1.  (a) The company has maintained proper records showing full
 particulars, including quantitative details and situation of fixed
 assets.
 
 (b) All Fixed assets have not been physically verified by the
 management during the year, hence, we are unable to comment on the
 discrepancies, if any.
 
 (c) There was no substantial disposal of fixed assets during the year.
 
 2.  (a) The management has conducted physical verification of the
 inventory during the period under audit.
 
 (b) The procedures of physical verification followed by the management
 need to be strengthened in relation to the size of the company and
 nature of its business.
 
 (c) In our opinion and according to the information and explanations
 given to us the company is maintaining proper records of inventory, and
 no material discrepancies were noticed on physical verification.
 
 3.  (a) The company has granted loans to three parties covered in the
 register maintained under section 301 of the Companies Act, 1956.
 
 The maximum amount involved during the period under audit was Rs.
 6535.38 lacs and the year-end balance of loan granted to such parties
 was Rs. 5470.82 lacs.
 
 (b) In our opinion and according to the information and explanation
 given to us, loans referred in clause 3(a) above, are interest free and
 there are no other terms and conditions stipulated for the said loans,
 hence we are unable to comment on the same.
 
 (c) There are no covenants stipulated in respect to repayment of loans
 referred in clause 3 (a) above, and hence we are unable to comment on
 regular repayment or overdue status of the same.
 
 (d) The Company has taken loan from one party covered in the register
 maintained under section 301 of the Companies Act, 1956. The maximum
 amount outstanding during the period under audit was Rs. 955 lacs and
 the year-end balance of loan taken from the party covered under section
 301 is Rs. 470.38 lacs.
 
 (e) In our opinion and according to the information and explanations
 given to us, the rate of interest and other terms and conditions for
 such loans are not prima facie prejudicial to the interest of the
 Company.
 
 (f) Loans taken are re-payable on demand. As informed, the lenders have
 not demanded repayment of any such loan during the year, thus, there
 has been no default on the part of the company. The payment of interest
 has been regular.
 
 4.  In our opinion, and according to the information and explanations
 given to us, there are adequate internal control systems commensurate
 with size of the Company and the nature of its business for the
 purchase of inventory and fixed assets and for the sale of goods.
 During the course of our audit, no major weakness has been noticed in
 the internal control systems in respect of these areas.
 
 5.  (a) According to the information and explanation provided by the
 Management, we are of the opinion that the particulars of contracts or
 arrangements referred to in section 301 of the act, that need to be
 entered into the register maintained under section 301 of the Companies
 Act, 1956 have been so entered.
 
 (b) In our opinion and according to the information and explanation
 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 aggregating during the year to Rs.5 lacs
 (Rupees Five Lacs only) or more in respect of a party has been made at
 price which is reasonable having regard to the prevailing market prices
 at the relevant time.
 
 6.  The Company has not accepted any deposits from the public to which
 the directives issued by the Reserve Bank of India, the provision of
 Sections 58A and 58AA or any other relevant provisions of the Companies
 Act, 1956 and the rules framed there under apply.
 
 7.  The Company has an internal audit system, the scope and coverage of
 which, in our opinion, requires to be enlarged to be commensurate with
 the size and nature of its business.
 
 8.  We have broadly reviewed the books of accounts maintained by the
 company pursuant to the order made by the Central Government for the
 maintenance of cost records under section 209 (1) (d) of the Companies
 Act, 1956 and are of the opinion that prima facie the prescribed
 accounts and records have been made and maintained. However we have not
 carried out any detailed examination of such accounts and records.
 
 9.  (a) According to the information and explanations given to us, and
 on the basis of our examination of the books of account, the Company is
 generally regular in depositing with appropriate authorities undisputed
 statutory dues including provident fund, investor education and
 protection fund, employees state insurance, income tax, sales tax,
 service tax, wealth tax, custom duty, excise duty, cess and other
 material statutory dues applicable to it, except slight delays in few
 cases.
 
 (b) According to the information and explanations given to us, no
 undisputed dues payable in respect of Income tax, wealth tax, sales
 tax, service tax, custom duty, excise duty and cess are in arrears as
 at 31st March, 2011 for a period of more than six months from the date
 they became payable.
 
 (c) According to the information and explanations given to us, the
 details of dues in respect of sales tax, income tax, service tax,
 customs duty, wealth tax, excise duty and cess that have not been
 deposited with the appropriate authorities on account of any dispute
 are as under:
 
 Financial year      Statute               Nature of Dues
 
 2001-02             Sales Tax Act         Sales Tax
 
 1996-97             Central Excise Act    Excise Duty
 to 2004-05
 
 2006-07             Central Excise Act    Service Tax
 
 2000-03             Drug Price Control 
                     Order - 95            Difference in Pricing
 
 Financial year      Forum where                  Amount
                     Dispute is pending           (Rs. In lacs)
 
 2001-02             Commissioner (Appeals)         39.13
 
 1996-97             Central Excise and Service     13.77
 to                  Tax Appellate Tribunal
 2004-05
 
 2006-07             Commissioner (Service Tax)     93.98
 
 2000-03             High Court (Mumbai)           591.34
    
 10.  The Company has accumulated losses amounting to Rs. 6025.50 lacs
 as at the end of the year under Audit. However the net worth as at the
 end of the period under report is positive and the accumulated losses
 i.e. debit balance in profit and loss account is not more than fifty
 percent of its net worth. The Company has not incurred cash losses
 during the year under audit or 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 a
 financial institution, bank or debentures holders.
 
 12.  Based on our examination of the records and the information and
 explanations given to us, the Company has not granted any loans and/ or
 advances 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 Company or nidhi /
 mutual benefit fund/society. Therefore the provisions of Clause (xiii)
 of the Order 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. 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
 terms and conditions on which the Company has given guarantee for loans
 taken by others from bank or financial institutions are not prejudicial
 to the interest of the Company.
 
 16.  In our opinion and according to the information and explanations
 given to us, the Term Loans raised by the Company have been applied for
 the purpose for which they were raised.
 
 17.  In our opinion and according to the information and explanation
 given to us, and on an overall examination of the balance sheet and
 cash flow of the company, fund raised on short term basis have prima
 facie not been used during the period for long term investments.
 
 18.  According to the information and explanations given to us, the
 company has made preferential allotment of shares to parties and
 companies covered in the register maintained under section 301 of the
 Act. In our opinion, the price at which shares have been issued is not
 prejudicial to the interest of the company.
 
 19.  The Company does not have any outstanding debentures at the end of
 the period.
 
 20.  During the period covered by our audit report, the Company has not
 raised any money by public issues.
 
 21.  Based upon the audit procedures performed for the purpose of
 reporting the true and fair view of the financial statements and as per
 the information and explanations given by the management, we report
 that no fraud on or by the Company has been noticed or reported during
 the course of our audit.
 
                                                For BATLIBOI & PUROHIT
                                                 Chartered Accountants 
                                                 Firm Regn No. 101048W
 
                                                           K. A. MEHTA
                                                               Partner 
                                                 Membership No. 111749
 
 Place : Mumbai
 Date  : 29th July, 2011