1.  We have audited the attached Balance Sheet of Prraneta Industries
 Limited as at 31st March 2011 and also the Profit and Loss Account for
 the year ended on that date annexed thereto and the Cash Flow Statement
 for the year ended on that date. 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 misstatement. An audit
 includes examining, on test basis, evidence supporting the amount and
 disclosures in the financial statements. An audit also includes
 assessing the accounting principles used and significant estimates made
 by management, as well as evaluation the overall financial statement
 presentation. We believe that our audit provides a reasonable basis for
 our opinion.
 
 3.  As required by the Companies (Audit Report) order, 2003 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 of
 books and records of the Company as were considered appropriate and the
 information and explanations given to us during the course of our
 audit, we enclosed 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 above, we
 report that:
 
 i.  We have obtained all the information and explanations, which to the
 best of our knowledge and belief necessary for the purposes of our
 audit;
 
 ii.  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.
 
 iii.  The Balance Sheet and Profit and Loss Account dealt with by this
 report are in agreement with the books of accounts.
 
 iv.  In our opinion, the Balance Sheet and Profit and Loss Account
 dealt with by this report comply with the accounting standards referred
 to in sub-section (3C) of section 211 of the Companies Act, 1956;
 
 v. 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 Companies Act, 1956;
 
 vi. In our opinion and to the best of our information and according to
 the explanations given to us, they said accounts read with notes give
 the information required by the Companies Act, 1956, in the manner so
 required and subject to Note No. 3, 7 & 8 read with Significant
 Accounting Policies included therein, give a true and fair view in
 conformity with the accounting principles generally accepted in India.
 
 · In case of the Balance Sheet, of the state of affairs of the Company
 as at 31st March 2011
 
 · In the case of the Profit and Loss Account, of the profit for the
 year ended on that date.  And
 
 · In case of the Cash Flow Statement, of the cash flows for the year
 ended on that date.
 
 
 
 ANNEXURE TO THE AUDITORS'' REPORT
 
 Re:- Prraneta Industries Limited – F.Y. 2010-11 Referred to in
 paragraph 3 of our report of even date,
 
 (i) FIXED ASSETS
 
 (a) The Company is yet in process of maintaining proper records showing
 full particulars including quantitative details and situation of fixed
 assets.
 
 (b) Assets have been physically verified by the management during the
 year. According to the information and explanations given to us, there
 is regular programme of verification which, in our opinion is
 reasonable having regards to the size of the Company and the nature of
 its assets. No material discrepancies were noticed on such
 verification.
 
 (c) Based on our scrutiny of the records of the company and the
 information and explanation received by us, we report that there was no
 sale of fixed assets. Hence, the question of reporting whether the sale
 of any substantial part of fixed assets has affected the going concern
 of the company does not arise.
 
 (ii) INVENTORIES
 
 (a) The Inventory has been physically verified during the year by the
 management. In our opinion, the frequency of verification is
 reasonable.
 
 (b) The procedures of physical verification 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 has maintained proper records of Inventories and no
 material discrepancy noticed on physical verification.
 
 (iii) LOANS AND ADVANCES
 
 a) The company has not granted unsecured loans or advances to companies
 covered in the Register maintained under Section 301 of the Act. Hence
 provisions of clauses (iii)(b),(c),(d) of paragraph 4 are not
 applicable to the Company.
 
 b) The Company has taken Interest free unsecured loan from one person
 covered in the register maintained under Section 301 of the Companies
 Act, 1956.The maximum amount involved during the year was Rs.12,11,037
 and the yearend balance of loan taken from such party was Rs.9,29,940.
 
 (iv) INTERNAL CONTROL
 
 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
 purchases of inventory, fixed assets and with regard to the sale of
 goods. During the course of our audit, we have not observed any
 continuing failure to correct major weaknesses in internal control
 except as stated above.
 
 (v) TRANSACTIONS WITH RELATED PARTIES AS PER REGISTER OF CONTRACTS
 UNDER SECTION 301 OF THE COMPANIES ACT, 1956
 
 (a) According to the information and explanations given to us, we are
 of the opinion that the transactions 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 explanations
 given to us, there is no transaction made with related parties in
 pursuance of contracts or arrangements entered in the register
 maintained under section 301 of the Companies Act, 1956 aggregating the
 value of rupees five lakhs or more 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.
 
 (vi) DEPOSITS FROM PUBLIC
 
 In our opinion and according to the information and explanations given
 to us, the Company has not accepted any deposits from the public.
 
 (vii) INTERNAL AUDIT SYSTEM
 
 The Company has no internal audit system commensurate with size and
 nature of its business.
 
 (viii) COST RECORDS
 
 As informed to us, The Company is not required to maintain cost records
 under section 209 (1) (d) of the Companies Act, 1956.
 
 (ix) STATUTORY DUES
 
 (a) According to the records of the Company, undisputed statutory dues
 including provident fund, sales tax, custom duty, excise duty, cess and
 other statutory dues have been regularly deposited with the appropriate
 authorizes.
 
 (b) According to the information and explanation given to us there is
 no disputed Liabilities on account of Sales Tax, Custom Duty, Wealth
 Tax, Service Tax, Excise duty and Cess as on 31st March,2011.
 
 (x) SICK INDUSTRY
 
 The Company has No accumulated losses and has not incurred any cash
 losses during the financial year 2010-2011, covered by audit. Further,
 the Company has no cash losses in the immediately preceding financial
 year.
 
 (xi) DUES TO FINANCIAL INSTITUTIONS
 
 Based on our audit procedures performed and on the information and
 explanation given by the management we are of the opinion that the
 Company has not in defaulted in making repayment of dues for a period
 over 12 months.
 
 Further, The Company has neither taken any loans from debenture holder
 hence no question of reporting arises to that extent.
 
 (xii) SECURED LOANS AND ADVANCES GRANTED
 
 In our opinion and according to the information and explanation given
 to us, no loans and advances have been granted by the Company on the
 basis of security by way of pledge of shares, debentures and other
 securities.
 
 (xiii) CHIT FUND, NIDHI OR MUTUAL BENEFIT COMPANY
 
 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 Report) Order, 2003 are not applicable to the
 Company.
 
 (xiv) INVESTMENT COMPANY
 
 In our opinion, the Company is not dealing in or trading in shares,
 securities, debentures and other investment.  Accordingly, the
 provisions of clause 4 (xiv) of the Companies (Auditor Report) Order,
 2003 are not applicable to the Company.
 
 (xv) GUARANTEES GIVEN BY COMPANY
 
 The Company has not given any guarantees for loans taken by other from
 banks or financial institutions.  There is no guarantee given by the
 Company to third party.
 
 (xvi) TERM LOANS
 
 In our opinion and according to the information and explanation given
 to us, the company has not taken any term loan during the year, hence
 no question of reporting arise to that extent.
 
 (xvii)SOURCE OF FUNDS AND ITS APPLICATION
 
 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
 investment. No long-term funds have been used to finance short-term
 assets except permanent working capital.
 
 (xviii)PREFERENTIAL ISSUE
 
 According to the information and explanations given to us, the Company
 has taken application money for issue of 4,50,00,000 No''s Convertible
 Equity Warrants on Preferential basis at a price of Rs.70/-per Equity
 Warrants including premium of Rs.69/- Per Share. The price at which the
 Convertible Equity Warrants application money have been issued is not
 prejudicial to the interests of the Company.
 
 (xix) DEBENTURES
 
 According to the information and explanations given to us, during the
 period covered by our audit report, the Company has not issued any
 debentures.
 
 (xx) PUBLIC ISSUE
 
 The Company has not raised any money by the public issue during the
 year covered by our audit report.
 
 (xxi) FRAUD
 
 Based upon our audit procedures performed and on the information and
 explanations given by the management we are of the opinion that no
 fraud on or by the Company has been noticed or reported during the
 course of our audit.
    
                                   For RAMESH BATHAM AND CO.  
 
                                   Firm Registration Number:123638W 
 
                                   Chartered Accountants 
 
                                        Sd/- 
 
                                   RAMESH BATHAM 
 
 Place : Surat.                    Proprietor
 
 Dated : 24th August, 2011         Membership No. 114178