We have audited the accompanying Standalone Ind AS
Financial Statements of RASHTRIYA CHEMICALS AND
FERTILIZERS LIMITED ("the Company"), which comprise
the Balance Sheet as at March 31, 2026, the Statement
of Profit and Loss (including Other Comprehensive
Income), Statement of Changes in Equity and Statement
of Cash Flows for the year ended March 31, 2026 and
notes to the financial statements, including a summary
of material accounting policies and other explanatory
information (hereinafter referred to as "the Standalone
Ind AS Financial Statements").

In our opinion and to the best of our information and
according to the explanations given to us, the aforesaid
Standalone Ind AS Financial Statements give the
information required by the Companies Act, 2013 ("the
Act") in the manner so required and give a true and fair
view in conformity with the Indian Accounting Standards
prescribed under section 133 of the Act read with the
Companies (Indian Accounting Standards) Rules, 2015,
as amended, ("Ind AS") and other accounting principles
generally accepted in India, of the state of affairs of the
Company as at March 31, 2026 and its profit and total
Comprehensive Income, changes in equity and its cash
flows for the year ended on that date.

Basis for Opinion

We conducted our audit of the Standalone Ind AS
Financial Statements in accordance with the Standards on
Auditing specified under section 143(10) of the Act (SAs).
Our responsibilities under those Standards are further
described in the Auditor's Responsibilities for the Audit
of the Standalone Ind AS Financial Statements section
of our report. We are independent of the Company in
accordance with the Code of Ethics issued by the Institute
of Chartered Accountants of India (ICAI) together with the
independence requirements that are relevant to our audit
of the Standalone Ind AS Financial Statements under the
provisions of the Act and the Rules made thereunder,
and we have fulfilled our other ethical responsibilities in
accordance with these requirements and the ICAI's Code
of Ethics. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis
for our audit opinion on the Standalone Ind AS Financial
Statements.

Emphasis of Matter

We draw attention to the following matters:

a) Note No. 46 - Property, Plant and Equipment: Title

deeds of Immovable properties:

In respect of immovable properties other than land

i.e. buildings and other structures, situated at its
Trombay and Thal units they are self-constructed
properties on the land owned by the Company as
evidenced by property cards/title deeds of land. The
Company asserts that all these properties are its own
and has clear title to the same since such properties
are self-constructed on the Company's land, although
no separate title documents for self-constructed
properties are readily available. The Company
has initiated the process of obtaining appropriate
evidence of the approvals/permissions taken for
construction of the self-constructed properties from
the respective regulatory authorities.

b) Note No. 48 - Gas pooling applicable to Fertilizer
(Urea) sector:

Gas Pool operator in ascertaining the contribution to
pool account, considered cheaper market price gases
specifically contracted by the Company for non¬
urea operations instead of EPMC/SPOT gas meant
for Urea Operations sourced as per DOF directives.
Accordingly differential price or contribution to the
pool by the company was worked out and issued
debit note.

The Company is of the view that EPMC gas / Spot
gas is specifically meant for urea operations and
thus needs to be subsumed in arriving at the final
pool price and the same should be considered in
the subsidy of urea, since the cost of gas is a pass
through.

As the non-recognition of such EPMC Gas / Spot gas
sourced as per DoF's directives for Urea Operations
is not in accordance with the principles of gas
pooling mechanism, the Company has continued to
recognize such differential i.e. (EPMC / Spot gas price
- Cheaper market gas price) amounting to Rs 80.57
crore for the period FY 2021-22 to FY 2023-24 which
has been shown as receivable from DoF.

Further, Company has disputed the demand of
Rs 52.18 crore raised by GAIL towards pool price
differential as against receivable of Rs 71.39 crore
for FY 22-23 which has been arrived at on account
of non-recognition of EPMC gas/Spot gas in Urea by
FICC by substituting EPMC gas/Spot gas with cheaper
RLNG gas sourced for non-urea operations. The total
disputed amount for the year 2022-23 stands at Rs
123.57 crore. Based on Company's representation
FICC has directed GAIL and stated that the said
matter is under examination by DoF. Total exposure
is about to Rs.204.14 crore. Accounting impact (If
any) of the above will be taken in the year in which
the matter is resolved by DoF.

:) Note No. 50 - Price adversity and Upward/Downward

Revision in CFR prices on Imported Phosphatic and
Potassic (P&K) fertilizers:

Department of Fertilizers (DoF), vide letter No. F.21-
01/2023-FM dated 21st September, 2023 issued to

Fertilizer CPSEs and subsequently vide letter No.
F.21-01/2023-FM dated 08th February, 2024 issued
to the Company, had directed ensuring availability
of Phosphatic and Potassic (P&K) fertilizers during
Rabi 2023-24 by undertaking procurement on
priority basis, with the assurance that any price
adversity arising on such procurements beyond the
applicable Nutrient Based Subsidy (NBS) rates would
be addressed by DoF on a "No Profit No Loss" basis.
Further, DoF vide File No. 21-01/2023-FM-Part (1)
dated 29th May, 2024 also allowed consideration
of price adversity beyond applicable NBS rates
in respect of unsold inventory and sales pending
acknowledgment in PoS by farmers as on 30th
September, 2023. Based on the aforesaid directions/
guidelines, the Company had recognized differential
subsidy claims up to 31st March, 2025. Against
the above provision, an amount of ' 217.50 crore
remains pending for settlement by DoF as on 31st
March, 2026.

d) Note No. 66 - Exceptional Item:

During the year, the Company has surrendered land
admeasuring 7,435.96 sq. mtrs. to the Municipal
Corporation of Greater Mumbai (MCGM), pursuant

to which Development Rights Certificate (TDR)
receivable valued at ' 41.04 crore is recognized
under exceptional items. Further, the impact of fair
valuation of TDRs received/accrued amounting to
' 4.06 crore has also been included under Exceptional
Items.

Our opinion is not modified in respect of the above
matters.

Key Audit Matters

Key audit matters are those matters that, in our
professional judgment, were of most significance in our
audit of the standalone Ind AS financial statements of
the current period. These matters were addressed in the
context of our audit of the Standalone Ind AS Financial
Statements as a whole, and in forming our opinion
thereon, and we do not provide a separate opinion on
these matters.

The key audit matters identified in our audit are:

1. Revenue Recognition and measurement in respect of
subsidy income.

2. Estimation of Provision & Contingent Liabilities.

3. Information Technology General Control.

Other Information

The Company's Board of Directors is responsible for the other information. The other information comprises the
information included in the Annual report but does not include the standalone Ind AS financial statements and our
auditor's report thereon. The Company's Annual report is expected to be made available to us after the date of this
auditor's report.

Our opinion on the standalone Ind AS financial statements
does not cover the other information and we do not
express any form of assurance conclusion thereon.

In connection with our audit of the standalone Ind AS
financial statements, our responsibility is to read the other
information and in doing so, consider whether the other
information is materially inconsistent with the standalone
Ind AS financial statements, or our knowledge obtained in
the audit or otherwise appears to be materially misstated.

When we read the Company's annual report, if we
conclude that there is a material misstatement therein,
we are required to communicate the matter to those
charged with governance.

Management and Board of Directors'
Responsibilities for the Standalone Ind AS Financial
Statements

The Company's Management and Board of Directors
are responsible for the matters stated in section 134(5)
of the Companies Act, 2013 ("the Act") with respect to
the preparation of these Standalone Ind AS Financial
Statements that give a true and fair view of the financial
position, the financial performance, total comprehensive
income, changes in equity and cash flows of the Company
in accordance with the accounting principles generally
accepted in India, including the Indian Accounting
Standards (Ind AS) prescribed under section 133 of the Act.

This responsibility also includes maintenance of adequate
accounting records in accordance with the provisions
of the Act for safeguarding the assets of the Company
and for preventing and detecting frauds and other
irregularities; selection and application of appropriate
accounting policies; making judgments and estimates that
are reasonable and prudent; and design, implementation
and maintenance of adequate internal financial controls
that were operating effectively for ensuring the accuracy
and completeness of the accounting records, relevant to
the preparation and presentation of the Standalone Ind
AS Financial Statements that give a true and fair view and
are free from material misstatement, whether due to fraud
or error.

In preparing the Standalone Ind AS Financial Statements,
management is responsible for assessing the Company's
ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the
going concern basis of accounting unless management
either intends to liquidate the Company or to cease
operations or has no realistic alternative but to do so.

The Board of Directors is also responsible for overseeing
the Company's financial reporting process.

Auditor's Responsibilities for the Audit of the
Standalone Ind AS Financial Statements

Our objectives are to obtain reasonable assurance about
whether the Standalone Ind AS Financial Statements as

a whole are free from material misstatement, whether
due to fraud or error and to issue an auditor's report
that includes our opinion. Reasonable assurance is a high
level of assurance but is not a guarantee that an audit
conducted in accordance with SAs will always detect a
material misstatement when it exists. Misstatements can
arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably
be expected to influence the economic decisions of users
taken on the basis of these Standalone Ind AS Financial
Statements.

As part of an audit in accordance with SAs, we exercise
professional judgment and maintain professional
skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement
of the Standalone Ind AS Financial Statements,
whether due to fraud or error, design and perform
audit procedures responsive to those risks and obtain
audit evidence that is sufficient and appropriate
to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from
fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional
omissions, misrepresentations or the override of
internal control.

• Obtain an understanding of internal financial
controls relevant to the audit in order to design
audit procedures that are appropriate in the
circumstances. Under section 143(3)(i) of the Act,
we are also responsible for expressing our opinion
on whether the Company has adequate internal
financial controls with reference to the standalone
Ind AS financial statements in place and the
operating effectiveness of such controls.

• Evaluate the appropriateness of accounting policies
used and the reasonableness of accounting estimates
and related disclosures made by management.

• Conclude on the appropriateness of management's
use of the going concern basis of accounting and
based on the audit evidence obtained, whether
a material uncertainty exists related to events or
conditions that may cast significant doubt on the
Company's ability to continue as a going concern.
If we conclude that a material uncertainty exists,
we are required to draw attention in our auditor's
report to the related disclosures in the Standalone
Ind AS Financial Statements or if such disclosures are
inadequate, to modify our opinion. Our conclusions
are based on the audit evidence obtained up to the
date of our auditor's report. However, future events
or conditions may cause the Company to cease to
continue as a going concern.

• Evaluate the overall presentation, structure
and content of the Standalone Ind AS Financial
Statements, including the disclosures and whether
the Standalone Ind AS Financial Statements

represent the underlying transactions and events in
a manner that achieves fair presentation.

Materiality is the magnitude of misstatements in the
Standalone Ind AS Financial Statements that, individually
or in aggregate, makes it probable that the economic
decisions of a reasonably knowledgeable user of the
standalone Ind AS financial statements may be influenced.
We consider quantitative materiality and qualitative
factors in (i) planning the scope of our audit work and in
evaluating the results of our work; and (ii) to evaluate the
effect of any identified misstatements in the standalone
Ind AS financial statements.

We communicate with those charged with governance
regarding, among other matters, the planned scope
and timing of the audit and significant audit findings,
including any significant deficiencies in internal control
that we identify during our audit.

We also provide those charged with governance with
a statement that we have complied with relevant
ethical requirements regarding independence and to
communicate with them all relationships and other
matters that may reasonably be thought to bear on our
independence and where applicable, related safeguards.

From the matters communicated with those charged
with governance, we determine those matters that were
of most significance in the audit of the Standalone Ind
AS Financial Statements of the current period and are
therefore the key audit matters. We describe these
matters in our auditor's report unless law or regulation
precludes public disclosure about the matter or when, in
extremely rare circumstances, we determine that a matter
should not be communicated in our report because the
adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such
communication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report)
Order, 2020 ("the Order") issued by the Central
Government in terms of Section 143(11) of the Act,
we give in "Annexure A" a statement on the matters
specified in paragraphs 3 and 4 of the Order.

2. As required by Section 143 (5) of the Act, we give
in "Annexure B" the directions and sub-directions
issued by the Comptroller and Auditors General of
India (CAG), the action taken thereon and its impact
on the accounts and the standalone Ind AS financial
statements of the Company.

3. Non - Compliance of the SEBI Listing Obligation and
Disclosure Requirements (LODR) Regulations, 2015
- as per Regulation 17(1)(b), the Chairman being
an Executive Director, at least half of the Board
of Directors should be comprised of Independent
Directors. As on 31.03.2026, the Company does not

have required number of Independent Directors on
its board. (Refer Note 42.4 to the standalone Ind AS
Financial Statements).

4. (A) As required by section 143(3) of the Act, we report

that:

a) We have sought and 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 it appears from our examination of
those books.

c) The Standalone Balance sheet, the Standalone
Statement of Profit and Loss (including Other
Comprehensive Income), Standalone Statement
of Changes in Equity and the Standalone
Statement of Cash Flow dealt with by this report
are in agreement with the relevant books of
account.

d) In our opinion, the aforesaid Standalone Ind AS
Financial Statements comply with the Indian
Accounting Standards prescribed under Section
133 of the Act.

e) The Company being a government company,
the provision of section 164(2) is not applicable
in accordance with the Notification No. GSR
463 (E) dated June 5, 2015 issued by Ministry
of Corporate Affairs. Accordingly, no reporting
regarding Clause 3(g) of section 143 is required.

f) With respect to the adequacy of the internal
financial controls with reference to the
standalone Ind AS financial statements of the
Company and the operating effectiveness of
such controls, refer to our separate report in
"Annexure C".

(B) In accordance with Rule 11 of the Companies (Audit
and Auditors) Rules, 2014, as amended in our opinion
and to the best of our information and according to
the explanations given to us:

i. The Company has disclosed the impact of
pending litigations on its financial position in its
Standalone Ind AS Financial Statements - Refer
Note 42 to the Standalone Ind AS financial
statements;

ii. The Company has made provision, as required
under the applicable law or accounting
standards, for material foreseeable losses, if
any, on long-term contracts including derivative
contracts;

iii. There is no delay in transferring amounts,
required to be transferred, to the Investor

Education and Protection Fund by the Company.

iv. a) The management has represented that,
to the best of its knowledge and belief,
no funds have been advanced or loaned
or invested (either from borrowed funds
or share premium or any kind of funds) by
the Company to or in any other persons
or entities, including foreign entities
("Intermediaries"), with the understanding,
whether recorded in writing or otherwise,
that the Intermediary shall:

• directly or indirectly lend or invest in
other persons or entities identified in
any manner whatsoever ("Ultimate
Beneficiaries") by or on behalf of the
Company or

• provide any guarantee, security or the
like to or on behalf of the Ultimate
Beneficiaries.

b) The management has represented, that,
to the best of its knowledge and belief, no
funds have been received by the Company
from any persons or entities, including
foreign entities ("Funding Parties"), with the
understanding, whether recorded in writing
or otherwise, that the Company shall:

• directly or indirectly, lend or invest in other
persons or entities identified in any manner
whatsoever ("Ultimate Beneficiaries") by or
on behalf of the Funding Party or

• provide any guarantee, security or the
like from or on behalf of the Ultimate
Beneficiaries; and

c) Based on such audit procedures as considered
reasonable and appropriate in the circumstances,
nothing has come to our notice that has caused
us to believe that the representations under
clause (iv) (a) and (iv) (b) contain any material
misstatement.

v. The dividend declared or paid during the year by
the Company is in compliance with section 123
of the Act.

(C) With respect to the other matters to be included in
the Auditor's Report as per section 197 (16) of the
Act:

In accordance with requirements of section 197 (16)
of the act as amended: As per notification number
G.S.R. 463 (E) dated June 5, 2015 issued by Ministry of
Corporate Affairs, Section 197 of the Act as regards
the managerial remuneration is not applicable to the
Company, since it is a Government Company.

(D) Based on our examination which included test checks,
the Company has used an SAP HANA software for
maintaining its books of account which has a feature
of recording audit trail (edit log) facility and the same
has operated throughout the year for all relevant
transactions recorded in the software. Further,
during the course of audit we did not come across
any instance of audit trail feature being tampered
with. [Additionally, the audit trail has been preserved
by the Company as per the statutory requirements
for record retention.]

For K. GOPAL RAO & CO For RAJU & PRASAD

Chartered Accountants Chartered Accountants

FRN : 000956S FRN : 003475S

CA GOPAL KRISHNA RAJU CA M. SIVA RAM PRASAD

Partner Partner

M. No.: 205929 M. No.: 018943

UDIN: 26205929ATJGIH4375 UDIN: 26018943TDUDUD3235

Place: Mumbai
Date: 21^st May, 2026