Comrade Applian.

Risks

• There are outstanding legal proceedings involving the Company, Promoters, Directors and Group Companies. Any adverse decision in such proceeding may have a material adverse effect on its business, results of operations and financial condition.

• The company business experiences an increase in sales during the summer seasons. And its major revenue comes from Air coolers. Any substantial decrease in its sales during such periods and its inability cope up with the company service during this time, then its revenues and profitability will be affected and have a negative effect on its image and brand.

• Its Registered Office and the company Factory are not owned by it. The same are occupied by it on a lease basis. Disruption of the company rights as lessee or termination of the agreements with its lessor would adversely impact its operations and, consequently, the company business.

• Under-utilization of its manufacturing capacities of Air Cooler and Electric Geysers could have an adverse effect on its business, future prospects and future financial performance.

• If the company customers do not continue to outsource manufacturing, or if there is a downward trend in consumer durable good business, its sales could be adversely affected.

• The company may be unable to respond to changes in consumer demands and market trends in a timely manner.

• The company could become liable to customers, suffer adverse publicity and incur substantial costs as a result of defects in its products, which in turn could adversely affect the value of the company brand, and its sales could be diminished if its associated with negative publicity.

• Its Promoters plays a key role in the company functioning and its heavily rely on their knowledge and experience in operating its business and therefore, it is critical for the company business that its promoters remain associated with the company.

• The company require a number of approvals, NOCs, licenses, registrations and permits in the ordinary course of its business. Some of the approvals are required to be obtained by the Company and any failure or delay in obtaining the same in a timely manner may adversely affect its operations.

• If the company is not able to obtain, renew or maintain the statutory and regulatory permits and approvals required to operate its business it may have an adverse effect on its business.

• The company inability to obtain no objections from its lenders for the Issue, in a timely manner or at all could adversely affect raising of funds.

• The company do not have firm commitment agreements with its customers. If the company customers choose not to source their requirements from it, The company business and results of operations may be adversely affected.

• The continuing effect of the COVID-19 pandemic on its business and operations is highly uncertain and cannot be predicted.

• General economic and market conditions in India and globally could have a material adverse effect on its business, financial condition, cash flows, results of operations and prospects.

• If the company is unable to respond to the demands of its existing and new clients, or adapt to technological changes or advances, its business and growth could be adversely affected.

• Any increase in interest rates would have an adverse effect on its results of operations and will expose the Company to interest rate risks.

• Major fraud, lapses of internal control or system failures could adversely impact the company`s business.

• There are certain discrepancies and non- compliances noticed in some of its corporate records relating to e-forms filed with the Registrar of Companies and Taxation authorities.

• The company continue to explore the diversification of its business and the manufacturing of new products. These diversifications and its other strategic initiatives may not be successful, which may adversely affect its business and results of operations.

• The company face intense competition in its businesses, which may limit the company growth and prospects. The Company faces significant competition from other companies in OEM Manufacturing of Air Cooler and Electric Geysers.

• Orders placed by customers may be delayed, modified or cancelled, which may have an adverse effect on its business, financial condition and results of operations.

• Further any defaults or delays in payment by a significant portion of its customers, may have an adverse effect on cash flows, results of operations and financial condition.

• Its inability to manage growth could disrupt its business and reduce the company profitability. The company propose to expand its business activities in coming financial years.

• The comoany funding requirements and the deployment of Net Proceeds are based on management estimates and have not been independently appraised. Further, its management will have discretion in the application of the Net Proceeds, and there is no assurance that the Objects of the Issue will be achieved within the time frame expected or at all.

• The Company has a negative cash flow in its operating activities in the financial year ending on March 31, 2021, financing activities in Stub period ending on August 31, 2022 and financial year ending on March 31, 2022 and investing activities in the Stub period and past 3 years, details of which are given below. Sustained negative cash flow could impact its growth and business.

• If the company is unable to source business opportunities effectively, its may not achieve the company financial objectives.

• Brand recognition is important to the success of its business, and the company inability to build and maintain its brand names will harm its business, financial condition and results of operation.

• Significant disruptions in its information technology systems or breaches of data security could adversely affect the company business and reputation.

• The nature of its business exposes the company to liability claims and contract disputes and its indemnities may not adequately protect it. Any liability in excess of its reserves or indemnities could result in additional costs, which would reduce the company profits.

• Employee fraud or misconduct could harm it by impairing the company ability to attract and retain clients and subject it to significant legal liability and reputational harm.

• The average cost of acquisition of Equity Shares by its Promoters is lower than the issue price.

• The company has entered into related party transactions in the past and may continue to do so in the future.

• Its top 5 and top 10 customers contribute major portion of the company revenues or the period August 31, 2022. Any loss of business from one or more of them may adversely affect its revenues and profitability.

• The company Promoters will continue to retain majority control over the Company after the Issue, which will allow them to influence the outcome of matters submitted to shareholders for approval.

• The company is dependent on a number of Key Managerial Personnel and its senior management, and the loss of, or the company inability to attract or retain such persons could adversely affect its business, results of operations and financial condition.

• The company operating expenses include overheads that may remain fixed in the medium term. In case there is any decline in its operating performance, the company may be unable to reduce such expenses.

• Delays or defaults in payments from its clients could result into a constraint on its cash flows. The efficiency and growth of the company business depends on timely payments received from its clients.

• The shortage or non-availability of power facilities may adversely affect its business processes and have an adverse impact on its results of operations and financial condition.

• The company insurance coverage may not adequately protect it against losses, and successful claims against the company that exceed its insurance coverage could harm its results of operations and diminish the company financial position.

• There are no alternate arrangements for meeting its requirements for the Objects of the Issue. Any shortfall in raising / meeting the same could adversely affect its growth plans, operations and financial performance.

• Guarantees from Promoters & Director as well as others have been taken in relation to the debt facilities provided to the company.

• The company ability to pay dividends in the future will depend upon its future earnings, financial condition, cash flows, working capital requirements, capital expenditure and restrictive covenants in its financing arrangements.

• Any future acquisitions, joint ventures, partnerships, strategic alliances, tie-ups or investments could fail to achieve expected synergies and may disrupt its business and harm the results of operations and its financial condition.

• The company future funds requirements, in the form of fresh issue of capital or securities and / or loans taken by it, may be prejudicial to the interest of the shareholders depending upon the terms on which they are eventually raised.

• The company lenders have imposed certain restrictive conditions on it under the company financing arrangements. Under its financing arrangements, the company has required to obtain the prior, written lender consent for, among other matters, changes in its capital structure, and formulation of a scheme of amalgamation or reconstruction and entering into any other borrowing arrangement. Further, the company is required to maintain certain financial ratios.

• Certain Agreements / deeds may be in the previous name of the company.

• Some of the KMPs is associated with the company for less than one year.

• There is no guarantee that its Equity Shares will be listed on the Stock Exchanges in a timely manner or at all.

• Excessive reliance on its information technology systems and their failure could harm the company relationship with customers, expose it to lawsuits or administrative sanctions or otherwise adversely affect its provision of products to customers and the company internal operation.

• The deployment of funds raised through this Issue shall not be subject to any Monitoring Agency and shall be purely dependent on the discretion of the management of the Company.

• Negative publicity could adversely affect its revenue model and profitability.

• Industry information included in this Draft Red Herring Prospectus has been derived from industry reports commissioned by it for such purpose. There can be no assurance that such third-party statistical, financial and other industry information is either complete or accurate.

• The requirements of being a public listed company may strain its resources and impose additional requirements.