We have audited the standalone financial statements
of CEAT Limited (the "Company"),its Employee Welfare
Trust which comprise the standalone balance sheet
as at 31 March 2026, and the standalone statement
of profit and loss (including other comprehensive
income), standalone statement of changes in equity
and standalone statement of cash flows for the year
then ended, and notes to the standalone financial
statements, including material accounting policies
and other explanatory information.
In our opinion and to the best of our information and
according to the explanations given to us, and based
on the consideration of report of the other auditor on
financial information of the Trust as was audited by
the other auditor, the aforesaid standalone financial
statements give the information required by the
Companies Act, 2013 ("Act") in the manner so required
and give a true and fair view in conformity with the
accounting principles generally accepted in India,
of the state of affairs of the Company as at 31 March
2026, and its profit and 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 obtained by us along with the consideration
of report of the other auditor referred to in the "Other
Matter" section below, is sufficient and appropriate
to provide a basis for our opinion on the standalone
financial statements.
Key Audit Matter
Key audit matters 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.
Key audit matter
See Note 2.3 and 27 of standalone financial statements
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Revenue recognition on Sale of Products
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How the matter was addressed in our audit
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The Company recognises revenue from the sale of
products when control over goods is transferred to the
customer based on specific terms and conditions of
sale contracts with respective customers. Revenue is
a key performance indicator and there is a presumed
fraud risk of revenue being overstated through
manipulation of the timing of transfer of control due
to pressures to achieve performance targets as well
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In view of the significance of the matter we applied the
following audit procedures in this area, among others
to obtain sufficient and appropriate audit evidence:
• Assessed the appropriateness of the policies in
respect of revenue recognition including discounts
and rebates by comparing with applicable
accounting standards.
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as meeting external expectations.
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• Performed testing of design, implementation and
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operating effectiveness of the Company's general
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Revenue is measured net of any discounts and
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Information Technology ('IT') controls and key IT
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rebates. Recognition and measurement of off-invoice
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application controls over revenue recognition by
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discounts and rebates accruals, involves judgement
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involving our IT specialists.
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and estimates. This leads to a risk of revenue being
misstated due to inaccurate estimation over off-
invoice discounts and rebates.
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• Performed testing of design, implementation
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and operating effectiveness of the Company's
key manual controls around revenue recognition
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Hence, revenue recognition is considered to be a key
audit matter.
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including accruals and actualization of discounts
and rebates.
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Revenue recognition on Sale of Products
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How the matter was addressed in our audit
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• Performed substantive testing of recognition
of revenue in the correct period by selecting
statistical samples of revenue transactions
recorded during and at the end of the financial
year and examining the underlying documents
such as sales invoices/contracts and dispatch/
shipping documents for the selected transactions.
• Obtained management's calculations for off-
invoice discounts and rebates accruals under
applicable schemes on a sample basis and
comparing the accruals made with the approved
schemes.
• Performed substantive testing by agreeing
statistical samples of discounts and rebate
accruals and disbursements to underlying
documents.
• Performed a retrospective assessment of
discounts and rebate accruals with prior period
to evaluate the historical accuracy.
• Tested a selection of payments made after 31
March 2026 and where relevant, comparing the
payment to the related rebate accrual.
• Scrutinised journal entries related to revenue
recognised during the year based upon specified
risk-based criteria, to identify unusual or irregular
item.
• Assessed the disclosures in accordance with Ind
AS 115.
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See Note 2.23 and 49 to standalone financial statements
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Business Combination - Acquisition of Camso Off -
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How the matter was addressed in our audit
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Highway construction equipment tyre and tracks
business
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During the financial year, the Company acquired the
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In view of the significance of the matter we applied the
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Camso brand's Off-Highway construction equipment
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following audit procedures in this area, among others
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tyre and tracks business effective September 01, 2025.
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to obtain sufficient and appropriate audit evidence:
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The Company undertook business combinations
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• Read the underlying definitive Asset Purchase
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that required accounting under Ind AS 103, Business
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Agreement to understand the key terms and
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Combinations. This process necessitates the
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conditions of the acquisition.
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application of the Purchase Price Allocation (PPA)
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method, which involves allocating the purchase
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• Evaluated the accounting treatment followed by
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consideration to the identifiable assets acquired and
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the Company with reference to provisions of Ind
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liabilities assumed based on their fair values. This
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AS 103.
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involves complexity and significant judgement in fair
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value assessments.
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• We have obtained understanding of the process
followed by the Company and evaluated the
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Considering the complexity and significant judgement
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design and implementation, and tested the
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required in fair value assessments, combined with the
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operating effectiveness of key internal controls
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material magnitude of the acquisition, this matter has
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related to the Company's valuation process.
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been identified as a key audit matter.
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• We have evaluated competence, capabilities and
independence of the experts engaged by the
Company.
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Revenue recognition on Sale of Products
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How the matter was addressed in our audit
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• We have involved our valuation specialist with
specialized skills and knowledge to assist in:
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a)
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Evaluating the appropriateness of the
valuation methodologies applied and also, to
test the inputs to the valuation models used
to determine the value of Property, Plant and
Equipment and Intangible Assets.
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b)
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Evaluating the key assumptions such as
discount rate, royalty rate, growth rate, etc.
by comparing it to a range of rates that were
independently developed using publicly
available market indices and market data
for comparable entities.
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c)
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Evaluating book value and depreciated
replacement cost basis knowledge of the
business and independent market sources to
develop the fair value of property, plant and
equipment.
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• We have assessed the adequacy of the Company's
disclosures in respect of the acquisition in
accordance with the requirements of Ind AS 103.
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Other Information
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 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 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,
applicable under the applicable laws and regulations.
Management's and Board of Directors'/
Trustees' Responsibilities 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 and
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. The Management
and Board of Directors of the Company/Trustees of the
Trust are responsible for maintenance of adequate
accounting records in accordance with the provisions
of the Act for safeguarding of the assets of Company/
Trust 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,
the Management and Board of Directors/Trustees are
responsible for assessing the ability of the Company/
Trust to continue as a going concern, disclosing, as
applicable, matters related to going concern and
using the going concern basis of accounting unless the
Board of Directors/Trustees either intends to liquidate
the Company/Trust or to cease operations, or has no
realistic alternative but to do so.
The Board of Directors/Trustees are responsible
for overseeing the financial reporting process of
Company/Trust.
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
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 the Management and Board of Directors.
• Conclude on the appropriateness of the
Management and Board of Directors use of the
going concern basis of accounting in preparation
of standalone financial statements 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 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 financial statements,
including the disclosures, and whether the
standalone financial statements represent the
underlying transactions and events in a manner
that achieves fair presentation.
• Obtain sufficient appropriate audit evidence
regarding the financial information of the Trust
of the Company to express an opinion on the
standalone financial statements. For the Trust
included in the standalone financial statements,
which have been audited by other auditor, such
other auditor remain responsible for the direction,
supervision and performance of the audit carried
out by them. We remain solely responsible for our
audit opinion. Our responsibilities in this regard
are further described in "Other Matter" in this audit
report.
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 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.
Other Matter
We did not audit the financial information of one Trust
included in the standalone financial statements of
the Company whose financial information reflects
total assets (before consolidation adjustments) of Rs.
3,943 lakhs as at 31 March 2026, total revenue (before
consolidation adjustments for the period from 16 May
2025 to 31 March 2026 ('the period')) of Rs. Nil and total
net profit after tax (before consolidation adjustments)
for the period amounting to Rs. 0.18 lakhs and net cash
inflows (before consolidation adjustments) of Rs. 0.10
lakhs for the period ended on that date, as considered
in the standalone financial statements. The financial
information of this Trust has been audited by the other
auditor whose report has been furnished to us, and
our opinion in so far as it relates to the amounts and
disclosures included in respect of Trust, is based solely
on the report of such other auditor.
Our opinion is not modified in respect of this matter.
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 of India in terms of Section 143(11) of
the Act, we give in the "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, to the extent applicable, 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 except for the matters
in respect of audit trail stated in the
paragraph 2B(f) below on reporting
under Rule 11(g) of the Companies
(Audit and Auditors) Rules, 2014.
c. The standalone balance sheet, the
standalone statement of profit and
loss (including other comprehensive
income), the standalone statement of
changes in equity and the standalone
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 Ind
AS specified under Section 133 of the Act.
e. On the basis of the written representations
received from the directors as on 01
April 2026 taken on record by the Board
of Directors, none of the directors is
disqualified as on 31 March 2026 from
being appointed as a director in terms
of Section 164(2) of the Act.
f. the qualification relating to maintenance
of accounts and other matters connected
therewith are as stated in the paragraph
2(A)(b) above on reporting under Section
143(3)(b) of the Act and paragraph 2B(f)
below on reporting under Rule 11(g) of the
Companies (Audit and Auditors) Rules,
2014.
g. With respect to the adequacy of the
internal financial controls with reference
to financial statements of the Company
and the operating effectiveness of such
controls, refer to our separate Report in
"Annexure B".
With respect to the other matters to be
included in the Auditor's 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 has disclosed the impact
of pending litigations as at 31 March 2026
on its financial position in its standalone
financial statements - Refer Note 39 to
the standalone financial statements.
b. 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
- Refer Note 48 to the standalone
financial statements.
c. There has been no delay in transferring
amounts, required to be transferred, to
the Investor Education and Protection
Fund by the Company.
d (i) The management of the Company
represented to us that, to the best
of its knowledge and belief, as
disclosed in the Note 50 (v) 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(s) or entity(ies), 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 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 of the Company
represented to us that, to the best
of its knowledge and belief, as
disclosed in the Note 50(vi) to the
standalone financial statements,
no funds have been received by
the Company from any person(s)
or entity(ies), 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 by or on behalf
of the Funding Parties ("Ultimate
Beneficiaries") or provide any
guarantee, security or the like on
behalf of the Ultimate Beneficiaries.
(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) above, contain any material
misstatement.
e. The final dividend paid by the Company
during the year, in respect of the same
declared for the previous year, is in
accordance with Section 123 of the Act
to the extent it applies to payment of
dividend.
As stated in Note 18 to the standalone
financial statements, the Board of
Directors of the Company has proposed
final dividend for the year which is
subject to the approval of the members
at the ensuing Annual General Meeting.
The dividend declared is in accordance
with Section 123 of the Act to the extent it
applies to declaration of dividend.
f. Based on our examination which
included test checks and in accordance
with requirements of the Implementation
guide on Reporting on Audit trail under
Rule 11(g) of the Companies (Audit and
Auditors) Rule, 2024, the Company
has used an accounting 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 respective
software except that the audit trail (edit
log) facility was not enabled at the
database level to log any direct data
changes up to 20th May 2025. Further,
we did not come across any instance of
the audit trail feature being tampered
with. Additionally, where audit trail (edit
log) facility was enabled and operated
in the previous years, the audit trail has
been preserved by the Company as per
the statutory requirements for record
retention.
C. With respect to the matter to be included in the Auditor's Report under Section 197(16) of the Act:
In our opinion and according to the information and explanations given to us the remuneration payable
by the Company to its directors during the current year is in accordance with the provisions of Section 197 of
the Act. The remuneration payable to any director by the Company is not in excess of the limit laid down under
Section 197 of 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 B S R & Co. LLP
Chartered Accountants
Firm's Registration No.:101248W/W-100022
Sadashiv Shetty
Partner
Place: Mumbai Membership No.: 048648
Date: 28 April 2026 ICAI UDIN:26048648TCAFWN5117
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