We have audited the standalone financial statements of Candour Techtex Limited (Formerly known as
Chandni Textiles Engineering Industries Limited) (hereinafter referred to as "the Company"), which
comprise the Balance Sheet as at 31 March 2025, and the Statement of Profit and Loss (including other
comprehensive income), Statement of Changes in Equity and Statement of Cash Flows for the year then
ended, and notes to the financial statements, including a summary of material accounting policies and other
explanatory information (hereinafter referred to as "the standalone financial statements").
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid
standalone 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 Standard
prescribed under Section 133 of the Act read with the Companies (Indian Accounting Standard) Rules, 2015,
as amended, (“Ind AS”) and other accounting principles generally accepted in India, of the state of affairs of
the Company as at 31 March 2025, and its profit (including other comprehensive income), changes in equity
and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit in accordance with the Standards on Auditing (SAs) specified under Section 143(10)
of the Act. Our responsibilities under those SAs are further described in the Auditor's Responsibilities for the
Audit of the Standalone 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 together with
the ethical requirements that are relevant to our audit of the standalone financial statements under the
provisions of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in
accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters ('KAM') are those matters that, in our professional judgment, were of most significance in
our audit of the standalone financial statements of the current period. These matters were addressed in the
context of our audit of the standalone financial statements as a whole, and in forming our opinion thereon,
and we do not provide a separate opinion on these matters. We have determined the matters described below
to be the key audit matters to be communicated in our report
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Measurement and valuation of inventory
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As at 31 March 2025, the Company has inventory
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Our audit procedures relating to the measurement of
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amounting to Rs.595.84 lakhs (Refer Note no. 9)
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inventory included the following:
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This was determined a key audit matter, as the
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(a)
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Understanding and evaluating the design and
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measurement and valuation of the inventory at the
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operating effectiveness of controls over physical
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year-end involves significant judgment and
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count and measurement of such inventory
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estimate.
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(b)
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Performing procedures to ensure that the changes
in inventory between last verification date and date
of Balance Sheet are properly recorded (Roll back
and forward procedures).
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The Company uses internal and external experts, to
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(c)
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Evaluating of competency and capabilities of
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perform volumetric assessments, on the basis of
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management’s experts;
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which the quantity for these inventories is
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(d)
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Performing substantive analytical procedures to
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estimated.
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(e)
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test the correctness of inventory existence and
valuation.
Testing of accuracy of inventory reconciliations
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The physical count of inventory was carried out by
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with the general ledgers at period end, including
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internal experts for inventory lying at Ankleshwar,
Nasik and Malegaon factories.
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test of reconciling items.
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Based on the above procedures performed, we did not
identify any material exceptions in the measurement
and valuation of inventory quantities of textile goods
and plastic goods.
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Issue of Equity Shares and Convertible Share Warrants on Preferential basis
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During the year, the Company has issued 1019475
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Our audit procedures relating to the issue of equity
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equity shares of Face value of Rs.10/- at a premium
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shares and convertible share warrants on preferential
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of Rs.73.70 per share on preferential basis under
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basis included the following :
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Sections 42 and 62 of the Companies Act 2013 for
the purpose of capital expenditure of Malegaon
unit and for its working capital requirements. The
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(a)
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Examination of records relating to compliance of
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company received Rs. 853.53 lakhs including
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provisions of the Companies Act and other
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share premium of Rs. 751.35 lakhs from such issue
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applicable regulations for issue of equity shares
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of equity shares on preferential basis.
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(b)
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and convertible share warrants on preferential
basis.
Verification of records relating to receipt of issue
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During the year, the Company has also issued
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money, relevant accounting treatment of funds
raised and appropriate disclosures in the financial
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1200000 convertible share warrants on preferential
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statements.
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basis at Rs 83.70 per convertible share warrant.
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(c)
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Establishing audit procedure to verify the
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This share warrant is convertible into 1 equity
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utilization of funds raised by issue of equity shares
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share of Rs 10/- Face Value and share premium of
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and convertible share warrants on preferential
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Rs 73.70 per equity share.
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basis.
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The Company has during the year received Rs
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Based on the above procedures performed, we have
ascertained that the funds raised through issue of equity
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251.10 lakhs being 25% of consideration on issue
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shares and convertible share warrants on preferential
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of share warrants and balance 75% i.e. Rs 753.30
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lakhs will be received on conversion of share
warrants within 18 months in one or more
tranches.
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basis have been used for the purposes for which they
were raised.
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The verification of utilization of funds raised
through issue of equity shares and convertible
share warrants on preferential basis was considered
as a key audit matter as it involves verification of
movement of funds.
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Information Other than the Standalone Financial Statements and Auditor‘s Report thereon
The Company’s Management and Board of Directors are responsible for the other information. The other
information comprises the information included in the Company’s annual report, but does not include the
financial statements and the auditors’ 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 financial statements does not cover the other information and we will not
express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statements, our responsibility is to read the other
Information identified above when it becomes available and, in doing so, consider whether the other
information is materially inconsistent with the standalone 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 and take necessary actions, as
applicable under the relevant laws and regulations.
Management’s and Board of Directors’ Responsibility for the Standalone Financial Statements
The Company's management and Board of Directors are responsible for the matters stated in Section 134(5)
of the Act with respect to the preparation of these standalone financial statements that give a true and fair
view of the state of affairs, profit / loss (including other 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) specified 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 of 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 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 financial statements, management and Board of Directors are 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.
Board of Directors is also responsible for overseeing the Company's financial reporting process.
Auditor’s Responsibilities for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone 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
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 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 control 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 standalone 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 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
auditors' 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 financial statements, including
the disclosures, and whether the standalone financial statements represent the underlying transactions
and events in a manner that achieves fair presentation.
Materiality is the magnitude of misstatements in the standalone financial statements that, individually or in
aggregate, makes it probable that the economic decisions of a reasonably knowledgeable user of the
standalone 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 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 financial statements of the current period and are therefore
the key audit matters. We describe these matters in our auditors' 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 (Auditors' Report) Order, 2020 ("the Order") issued by the Central
Government of India 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, to the extent applicable.
2. (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 Balance Sheet, the Statement of Profit and Loss (including other comprehensive
income), the Statement of Changes in Equity and the Statement of Cash Flows dealt with by
this Report are in agreement with the books of account.
(d) In our opinion, the aforesaid standalone financial statements comply with the Indian
Accounting Standards specified under Section 133 of the Act.
(e) On the basis of the written representations received from the directors as on 31 March 2025
taken on record by the Board of Directors, none of the directors is disqualified as on 31
March 2025 from being appointed as a director in terms of Section 164(2) of the Act.
(f) With respect to the adequacy of the internal financial controls with reference to standalone
financial statements of the Company and the operating effectiveness of such controls, refer
to our separate Report in "Annexure B".
(B) With respect to the other matters to be included in the Auditors Report in accordance with Rule 11
of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our
information and according to the explanations given to us:
(a) The Company does not have pending litigations which would impact its financial position;
(b) The Company did not have any long-term contracts including derivative contracts for which
there were any material foreseeable losses; and
(c) There has been no amount required to be transferred to the Investor Education and
Protection Fund by the Company.
(d) (i) The Management has represented that, to the best of its knowledge and belief, as
disclosed in Note No. 48(viii) to the standalone financial statements, no funds have
been advanced or loaned or invested (either from borrowed funds or share premium
or any other sources or kind of funds) by the company to or in any other person or
entity, including foreign entity (“Intermediaries”), with the understanding, whether
recorded in writing or otherwise, that the Intermediary shall, whether, directly or
indirectly lend or invest in other persons or entities identified in any manner
whatsoever by or on behalf of the company (“Ultimate Beneficiaries”) or provide any
guarantee, security or the like on behalf of the Ultimate Beneficiaries;
(ii) The Management has represented, that, to the best of its knowledge and belief, as
disclosed in Note No. 48(viii) to the standalone financial statements, no funds have
been received by the company from any person or entity, including foreign entity
(“Funding Parties”), with the understanding, whether recorded in writing or otherwise,
that the company shall, whether, directly or indirectly, lend or invest in other persons
or entities identified in any manner whatsoever by or on behalf of the Funding Party
(“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of
the Ultimate Beneficiaries; and
(iii) Based on the audit procedures that have been considered reasonable and appropriate
in the circumstances, nothing has come to our notice that has caused us to believe that
the representations under sub-clause (i) and (ii) of Rule 11(e), as provided under (i)
and (ii) hereinabove, contain any material misstatement.
(e) The company has not declared or paid any dividend during the year.
(f) Based on our examination which included test checks, the Company has used an accounting
software for maintaining its books of account for the financial year ended 31 March, 2025
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 our audit, we did not come across any instance of audit trail feature being tampered
with. The audit trail has been preserved by the company as per the statutory requirements for
record retention from the date such audit trail (edit log) facility was enabled in the accounting
software.
(C) With respect to the matter to be included in the Auditors' Report under Section 197(16) as amended:
In our opinion and according to the information and explanations given to us, the Company has
paid/provided for managerial remuneration in accordance with the provisions of Section 197 read
with Schedule V to the Act. The Ministry of Corporate Affairs has not prescribed other details
under Section 197(16) of the Act which are required to be commented upon by us.
For Ambavat Jain & Associates LLP
Chartered Accountants
ICAI Firm Registration No: 109681W
Ashish J Jain
Partner
Membership No.111829
Place: Mumbai
Date: 29 May 2025
ICAI UDIN No: 25111829BMIFOS5778
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