We have audited the standalone financial statements of
Chalet Hotels Limited (the "Company”) 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, 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 we
have obtained is sufficient and appropriate to provide a basis
for our opinion on the standalone financial statements.

EMPHASIS OF MATTER

We draw attention to Note 43(A)(c) to the standalone financial
statements that explains the ongoing litigation in respect of
leasehold rights to land and building at Vashi (Navi Mumbai)
purchased from K Raheja Corp Private Limited ('K Raheja'),
on which the Company's hotel, Four Points by Sheraton has
been built. As at 31 March 2026, the matter continues to
be pending before the Supreme Court. Accordingly, there
remains uncertainty regarding the imposition of any penalty
on the Company and its quantum, if any.

In earlier years, based on two public interest litigations,
the Honourable High Court of Bombay ordered K Raheja
to demolish the structure and hand back the land to City &
Industrial Development Corporation ('CIDCO'). In response, K
Raheja filed a special leave petition (SLP) against the order
in the Honourable Supreme Court of India ('Supreme Court')
which directed maintenance of status quo vide its order dated
21 January 2015 and ordered that the interim orders remain in
force until further hearings.

Pursuant to the Supreme Court's order dated 27 October
2025, the SLP filed by K Raheja was converted into Civil
Appeals, and CIDCO was directed to file an affidavit on steps
taken regarding regularisation. Subsequently, CIDCO, through
Board Resolution No. 13178 dated 4 February 2026, approved
regularisation of the allotment, subject to payment of
differential premium, interest and taxes and placed the same
on record before the Court vide affidavit dated 9 March 2026.

Pending the final outcome of proceedings and basis legal
advice obtained, no adjustments have been made to the
standalone financial statements as at 31 March 2026.

Our opinion is not modified in respect of this matter.

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.

Revenue Recognition

See Note 29 to standalone financial statements

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(s) 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'
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. 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, the
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 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 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.

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.

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
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 matter stated
in the paragraph 2(B)(f) below on reporting
under Rule 11(g) of the Companies (Audit and
Auditors) Rules, 2014 and that the back-up of
certain units which form part of the 'books of
account and other relevant books and papers
in electronic mode' have not been maintained
on the servers physically located in India.

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 and 02 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 modification relating to the maintenance
of accounts and other matters connected
therewith are as stated in the paragraph 2A(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”.

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 43(A) to the standalone financial
statements.

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

c. There were no amounts which were 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 the Note 64(i) 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 has represented that, to the
best of its knowledge and belief, other than as
disclosed in the Note 64(ii) 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 interim dividend declared and paid by the
Company during the year and until the date of
this audit report is in compliance accordance with
Section 123 of the Act.

As stated in Note 68 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, except for the instances mentioned below,
the Company has used accounting software for
maintaining of books of account, which have 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
softwares:

i. The feature of audit trail was not enabled
in the application layer of the accounting
softwares used for maintaining the books
of account relating to revenue, inventory,
accounts payables, accounts receivables,
general ledger.

ii. The feature of audit trail was not enabled
in the database layer to log any direct data
changes for the accounting softwares used
for maintaining the books of account relating
to revenue, inventory, accounts payables,
accounts receivables, general ledger.

iii. The feature of audit trail was not enabled in the
database layer to log any direct data changes
for the on-premise accounting softwares used
for maintaining the books of account relating
to revenue, inventory, accounts payables,
accounts receivables, general ledger.

iv. Based on the examination of an independent
auditor's report in relation to controls at
service organization for accounting software
used for maintenance of revenue, inventory,
general ledger, accounts payable, accounts
receivable, payroll, general ledger which are
operated by a third-party software service
provider, we are unable to comment whether
audit trail feature for the said software was
enabled at the application layer for the period
from 1 January 2026 to 31 March 2026 for
all relevant transactions recorded in the
respective software or whether there were
any instances of the audit trail feature being
tampered with. The feature of audit trail was
not enabled in the database layer to log any
direct data changes for the period from 01
April 2025 to 31 March 2026.

v. Based on the examination of an independent
auditor's report in relation to controls at
service organization for accounting software
used for maintenance of inventory, general
ledger, accounts payable, accounts receivable,
general ledger which are operated by a third-
party software service provider, we are unable
to comment whether audit trail feature for the
said software was enabled at the database
layer for the period from 1 March, 2026 to
31 March, 2026 for all relevant transactions
recorded in the respective software or
whether there were any instances of the audit
trail feature being tampered with.

For the periods where audit trail (edit log) facility
was enabled and operated for the respective
accounting software, we did not come across any
instance of the audit trail feature being tampered
with.

Additionally, the audit trail has been preserved by
the Company as per the statutory requirements for
record retention except for the periods where audit
trail was not enabled for the respective software in
the prior year.

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 paid by the
Company to its directors during the current year is in
accordance with the provisions of Section 197 of the
Act. The remuneration paid to any director 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

Suhas Pai

Partner

Place: Mumbai Membership No.: 119057

Date: May 14, 2026 ICAI UDIN: 26119057UGEQGD856