We have audited the accompanying standalone Ind AS financial
statements of HBL Engineering Limited (formerly known as HBL
Power Systems 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 then
ended and notes to the standalone financial statements including
material accounting policies and other explanatory information
(hereinafter referred to as "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 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,
total 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 Companies

Act, 2013. Our responsibilities under those Standards are further
described in the Auditor's Responsibilities for the Audit of the
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
Companies Act, 2013 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 on the standalone financial
statements.

Key audit matters

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. We have
determined the matters described below to be the key audit
matters to be communicated in our report:

Information other than the standalone financial
statements and auditor's report thereon

The Company's Board of Directors is responsible for the other
information. The other information comprises the information included
in Annual Report but does not include the financial statements and our
auditor's report thereon. The 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 do 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 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.

Responsibilities of management and those charged with
governance for the standalone financial statements

The Company's Board of Directors is responsible for the matters
stated in Section 134(5) of the Companies Act, 2013 ("the Act")

with respect to the preparation of these standalone financial
statements that give a true and fair view of the financial position,
financial performance, changes in equity and cash flows of the
Company in accordance with the accounting principles generally
accepted in India, including the 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 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 Board of
Directors 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 the Board of Directors 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 financial statements

Our objectives are to obtain reasonable assurance about whether
the 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 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 Companies
Act, 2013, 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
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.

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) evaluating 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 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.

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 sub-section (11) of section 143 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) 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,
Statement of Changes in Equity and the Cash Flow
Statement dealt with by this Report are in agreement
with the books of account.

(d) In our opinion, the aforesaid standalone financial
statements comply with Ind AS prescribed under
Section 133 of the Act.

(e) On the basis of the written representations received
from the Directors as on March 31, 2026, taken on
record by the Board of Directors, none of the Directors
is disqualified as on March 31, 2026 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", wherein we have expressed
an unmodified opinion.

(g) 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:

(i) The Company has disclosed the impact of
pending litigations on its financial position in its
standalone financial statements - Refer Note 43.2
to the standalone financial statements.

(ii) The Company did not have any long-term
contracts including derivative contracts for which
there were any material foreseeable losses.

(iii) There has been no delay in transferring amounts,
required to be transferred to the Investor
Education and Protection Fund by the Company.

(iv) (a) The Management of the Company has

represented to us that, to the best of
their knowledge and belief, other than as
disclosed in the notes to accounts, no funds
(which are material either individually or
in the aggregate) 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.

(b) The Management of the Company has
represented to us that, to the best of their
knowledge and belief, no funds (which
are material either individually or in the
aggregate) 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 Party ("Ultimate Beneficiaries")
or provide any guarantee, security or the like
on behalf of the Ultimate Beneficiaries.

(c) Based on the audit procedures that
have been considered reasonable and
appropriate in the circumstances performed
by us on the Company, nothing has come
to our notice that has caused us to believe
that the representations under sub-clauses
(i) and (ii) of Rule 11(e), as provided under
(a) and (b) above, contain any material
misstatement.

(v) (a) The final dividend declared for the previous

year and paid by the Company during the
year ended March 31,2026 is in accordance
with Section 123 of the Act, as applicable.

The interim dividend paid by the Company
during the year ended March 31,2026 is in
accordance with Section 123 of the Act, as
applicable.

(b) As stated in Note 43.3 to the standalone
financial statements, the Board of Directors
of the Company have proposed dividend for
the year which is subject to the approval of
the members at the ensuing Annual General
Meeting. The amount of dividend proposed
is in accordance with section 123 of the Act,
as applicable.

(vi) Based on our examination, which included test
checks, we observed that the Company has used
accounting software for maintaining its books
of account which has a feature of recording an
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 instances where the audit trail feature
was tampered with and the audit trail has been
preserved by the Company as per the statutory
requirements for record retention.

(h) With respect to the other matters to be included in the
Auditor's Report in accordance with the requirements of
section 197(16) of the Act, as amended, in our opinion
and to the best of our information and according to
the explanations given to us, the remuneration paid
by the Company to its directors during the year is in
accordance with the provisions of section 197 of the Act.

For L N R Associates

Chartered Accountants
FRN 05381S

Raghuram Vedula Place: Hyderabad

Partner Date: May 23, 2026

M.No. 242883

UDIN: 26242883YXVTMY3966