1. We have audited the accompanying standalone
financial statements of Divi's Laboratories Limited ("the
Company"), which comprise the Standalone Balance
Sheet as at March 31, 2025, the Standalone Statement
of Profit and Loss (including Other Comprehensive
Income), the Standalone Statement of Changes in Equity,
the Standalone Statement of Cash Flows for the year then
ended, and notes to the standalone financial statements,
including material accounting policy information and
other explanatory information (hereinafter referred to
as "the standalone financial statements").

2. I n 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 accounting principles generally
accepted in India, of the state of affairs of the Company
as at March 31, 2025, total comprehensive income
(comprising of profit and other comprehensive income),
changes in equity and its cash flows for the year then
ended.

Basis for Opinion

3. We conducted our audit in accordance with the Standards
on Auditing (SAs) specified under Section 143(10) of
the Act. 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 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

4. Key audit matters are those matters that, in our
professional judgement, 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.

A) Appropriateness of recognition of revenue from
sale of products in correct period

Refer to Note 16 to the standalone financial statements.

The Company has earned revenue of '9,141 crores from
sale of products during the year. Revenue in respect
of sale of products is recognised when the customer
obtains control of the Company's product, which occurs
at a point in time.

The Company has many customers operating in various
geographies and sale contracts with customers have
different international commercial terms (incoterms),
which influence the timing of recognition of revenue.

The above was considered to be a key audit matter, since
revenue is one of the key performance indicators for the
Company and there is a risk of recognition of revenue in
an incorrect period given the different contractual terms
with the customers.

Our procedures included the following:

• Evaluated relevant accounting policies and
assessed whether it is in compliance with applicable
accounting standards.

• Performed walkthrough and obtained detailed
understanding of Company's revenue recognition
process.

^• Evaluated the design, implementation and tested
the operating effectiveness of controls around
recognition of revenue from sale of products.

• Tested revenue from sale of products, including
sales occurred close to year end period, to their
underlying supporting documents like purchase
order, invoice, shipping documents, incoterms etc.,
on sample basis to evaluate whether revenue has
been recognised in the correct accounting period.

• Verified whether the presentation and disclosures
are in accordance with applicable accounting
standards and reporting framework.

B) Appropriateness of capitalisation of costs as
per Ind AS 16, Property, Plant and Equipment
("Ind AS 16")

Refer to Note 3 & 4 to the standalone financial
statements.

During the year, the company incurred capital
expenditure of '1,362 crores across various locations
and capitalised '1,115 crores as Property, Plant and
Equipment, mainly comprising Plant and Machinery,
Roads and Buildings. This includes '755 crores with
respect to unit of a greenfield project at Ontimamidi
village near Kakinada, Andhra Pradesh, which
commenced its commercial production.

This has been determined as a key audit matter due to
the risk associated with inappropriate allocation of costs
to different items of Property, Plant and Equipment
having different useful life, and the risk that the
elements of costs that are eligible for capitalisation are
not appropriately capitalised or that capitalised costs
are not in accordance with the recognition criteria of
Ind AS 16.

Our procedures included the following:

• Understood and evaluated the design and tested
the operating effectiveness of key controls relating
to capitalisation of appropriate costs and process
followed for accumulating costs relating to
individual items of Property, Plant and Equipment.

• Tested, on a sample basis, the costs capitalised
during the year against underlying supporting
documents to ascertain the nature of the costs and
whether it is specifically attributable to an item of
Property, Plant and Equipment and the basis of
allocation of costs, where applicable, and evaluated
whether these costs meet the recognition criteria
under Ind AS 16.

• In respect of internal costs such as employee
benefits expense and other direct expenses
allocated to items of Property, Plant and
Equipment, tested on a sample basis whether the
costs are directly attributable to the construction of
the project.

• Tested, on a sample basis, other costs debited
to the Statement of profit and loss to determine
whether they meet the criteria for capitalisation.

• Examined the useful life assigned to each significant
part of an item of Property, Plant and Equipment

capitalised to determine whether it is consistent
with the Company's accounting policy.

• Assessed the adequacy of the related disclosures in
the standalone financial statements.

Other Information

5. The Company's Board of Directors is responsible for the
other information. The other information comprises the
Management Discussion and Analysis, Board's report,
Business Responsibility and Sustainability Report and
Corporate Governance Report (but does not include the
financial statements and our auditor's report thereon),
which we obtained prior to the date of this auditor's
report, and additional information excluding those
referred earlier that would be included in the annual
report which is expected to be made available to us after
that date.

Our opinion on the standalone financial statements does
not cover the other information and 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 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.

If, based on the work we have performed on the other
information that we obtained prior to the date of this
auditor's report, we conclude that there is a material
misstatement of this other information, we are required
to report that fact.

We have nothing to report in this regard.

When we read the additional information excluding
those referred earlier that would be included in 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
appropriate action as applicable under the relevant laws
and regulations.

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

6. The Company's Board of Directors is 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 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 Indian Accounting Standards 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.

7. I n preparing the standalone financial statements, 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 Board of
Directors either intends to liquidate the Company or to
cease operations, or has no realistic alternative but to do
so.

8. Those Board of Directors are also responsible for
overseeing the Company's financial reporting process.

Auditor's responsibilities for the audit of the
financial statements

9. 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.

10. As part of an audit in accordance with SAs, we exercise
professional judgment and maintain professional
scepticism 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
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.

11. 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.

12. 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.

13. 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

14. 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 B" a statement on the
matters specified in paragraphs 3 and 4 of the Order, to
the extent applicable.

15. 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 matters stated in paragraph 15(h)
(vi) below on reporting under Rule 11(g) of the
Companies (Audit and Auditors) Rules, 2014 (as
amended).

(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 Indian Accounting
Standards specified under Section 133 of the Act.

(e) On the basis of the written representations received
from the directors as on March 31, 2025, taken
on record by the Board of Directors, none of the

directors is disqualified as on March 31,2025, from
being appointed as a director in terms of Section
164(2) of the Act.

(f) With respect to the maintenance of accounts and
other matters connected therewith, reference is
made to our remarks in paragraph 15(b) above on
reporting under Section 1 43(3)(b) and paragraph
15(h)(vi) below on reporting under Rule 11(g) of
the Companies (Audit and Auditors) Rules, 2014 (as
amended).

(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 A".

(h) 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
(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 financial statements - Refer Note
32 to the standalone financial statements.

ii. The Company was not required to recognise
a provision as at March 31, 2025 under the
applicable law or Indian Accounting Standards,
as it does not have any material foreseeable
losses on long-term contracts. The Company
did not have any derivative contracts as at
March 31,2025.

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

iv. (a) The management has represented

that, to the best of its knowledge and
belief, as disclosed in Note 34(v)(A) 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 persons or entities, including
foreign entities ("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;

(b) The management has represented that,
to the best of its knowledge and belief,
as disclosed in the Note 34(v)(B) to the
standalone financial statements, 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, 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

(c) Based on such audit procedures that we
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 (a) and (b) contain any material
misstatement.

v. 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 Companies Act 2013 to the extent it
applies to payment of dividend.

As stated in Note 28(b) to the standalone
financial statements, the Board of Directors
of the Company have 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.

vi. Based on our examination, which included test
checks, 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 that has operated throughout
the year for all relevant transactions recorded
in the software, except that the audit trail has
not been enabled for changes made through
one specific access at the application level and
at the direct database level.

The audit trail feature for another software
application was incrementally enabled and
operated from June 29, 2024, except for
changes made at the direct database level.

During the course of performing our
procedures, we did not notice any instance
of audit trail feature being tampered with or
not preserved by the Company as per the
statutory requirements for record retention
in instances where audit trail facility is enabled
and operating.

16. The Company has paid/ provided for managerial
remuneration in accordance with the requisite approvals
mandated by the provisions of Section 197 read with
Schedule V to the Act.

For Price Waterhouse Chartered Accountants LLP

Firm Registration Number: 012754N/N500016

N.K. Varadarajan

Partner

Date: May 17, 2025 Membership Number: 90196

Place: Hyderabad UDIN: 25090196BMRJSI9147