CONTENTS Proxy Form 65

Auditors’ Report to the Members of Essar Steel Limited1. We have audited the attached Balance Sheet of Essar SteelLimited (‘the Company’) as at March 31, 2008 and also the Profitand Loss Account and the Cash Flow Statement for the year endedon that date annexed thereto. These financial statements are theresponsibility of the Company’s management. Our responsibilityis to express an opinion on these financial statements based onour audit.2. We conducted our audit in accordance with auditing standardsgenerally accepted in India. Those Standards require that we planand perform the audit to obtain reasonable assurance about whetherthe financial statements are free of material misstatement. Anaudit includes examining, on a test basis, evidence supporting theamounts and disclosures in the financial statements. An audit alsoincludes assessing the accounting principles used and significantestimates made by management, as well as evaluating the overallfinancial statement presentation. We believe that our audit providesa reasonable basis for our opinion.3. As required by the Companies (Auditor’s Report) Order, 2003 (asamended) (‘the order’) issued by the Central Government of Indiain terms of sub-section (4A) of Section 227 of the Companies Act,1956, we enclose in the Annexure a statement on the mattersspecified in paragraphs 4 and 5 of the said Order.4. Further to our comments in the Annexure referred to above, wereport that:iv. In our opinion, the balance sheet, profit and loss account andcash flow statement dealt with by this report comply with theaccounting standards referred to in sub-section (3C) of Section211 of the Companies Act, 1956.v. On the basis of the written representations received fromthe directors, as on March 31, 2008, and taken on record bythe Board of Directors, we report that none of the directors isdisqualified as on March 31, 2008 from being appointed asa director in terms of clause (g) of sub-section (1) of Section274 of the Companies Act, 1956.vi. In our opinion and to the best of our information and accordingto the explanations given to us, the said accounts give theinformation required by the Companies Act, 1956, in the mannerso required and give a true and fair view in conformity with theaccounting principles generally accepted in India;a) in the case of the balance sheet, of the state of affairs ofthe Company as at March 31, 2008;b) in the case of the profit and loss account, of the profit forthe year ended on that date; andc) in the case of cash flow statement, of the cash flows for theyear ended on that date.i. We have obtained all the information and explanations, whichto the best of our knowledge and belief were necessary for thepurposes of our audit;For S. R. BATLIBOI & CO.Chartered Accountantsii. In our opinion, proper books of account as required by lawhave been kept by the Company so far as appears from ourper Hemal Shahexamination of those books;Place: MumbaiPartneriii. The balance sheet, profit and loss account and cash flowDate: July 07, 2008 Membership No.: 42650statement dealt with by this report are in agreement with thebooks of account;9