Dindigul Farm

Risks

• The company has incurred net losses during Fiscal 2022 and Fiscal 2021 and its inability to achieve profitability in future may have an adverse effect on its operations. Further the company had negative networth for the past three fiscal years.

• Any increase in the cost of its raw material or a shortfall in the supply of the company raw materials, may adversely affect the pricing and supply of its products and have an adverse effect on the company`s business, results of operations and financial condition.

• Real or perceived product contamination could result in reduced sales, product liability and damage to its reputation, and subject it to regulatory action.

• The company has experienced negative cash flows in the period ended December 23, 2023, and in Fiscal 2023, Fiscal 2022 and Fiscal 2021.

• The Company is dependent on few suppliers for purchase of product. Loss of any of these large suppliers may affect its business operations.

• The company does not receive firm and long-term volume purchase commitments from its customers. If the company customers choose not to renew their supply contracts with it or continue to place orders with the company, its business and results of operations will be adversely affected.

• Its business is dependent and will continue to depends on the company processing facility, and the company is subject to certain risks in its processing operations such as the breakdown or failures of equipment, industrial accidents, injury to employees, severe weather conditions and natural disasters.

• The company derives a significant portion of its revenue from certain customers, and the loss of one or more such customers, the deterioration of their financial condition or prospects, or a reduction in their demand for its products could adversely affect the company`s business, results of operations, financial condition and cash flows.

• The Company has in the past not complied with the certain provisions of the Companies Act, 2013.

• Its proposed expansion plan relating to the company processing facility are subject to the risk of unanticipated delays in implementation, cost overruns. If the company is unable to implement the expansion plans at the planned cost, it could materially and adversely impact its business, results of operations and financial condition.

• The company generate its major portion of sales from its operations in certain geographical regions especially Tamil Nadu, Gujarat and Himachal Pradesh. Any adverse developments affecting its operations in these regions could have an adverse impact on its revenue and results of operations.

• Improper storage, processing or handling of whole milk, skimmed milk and its dairy products may result in spoilage of, and damage to, such whole milk, skimmed milk and dairy products which may adversely affect its business prospects, results of operations and financial condition.

• The company is dependent on third party transportation and logistics service providers. Any increase in the charges of these entities could adversely affect its business, results of operations and financial condition.

• The markets in which its customers compete are characterized by consumers and their rapidly changing preferences and other related factors including alternatives available at lower costs. If the company is unable to keep up with the requirements of its customers in a timely manner or at all, it may adversely affect the company`s business, results of operations and financial condition.

• The company has trade receivables amounting to Rs. 250.80 Lakhs which are more than 3 years old as at the end of December 23, 2023.

• Its business is operating under various laws which requires the company to obtain approvals from the concerned statutory/regulatory authorities in the ordinary course of business and its inability to obtain, maintain or renew requisite statutory and regulatory permits and approvals for its business operations could materially and adversely affect its business, prospects, results of operations and financial condition.

• The company has certain outstanding litigation against it, an adverse outcome of which may adversely affect its business, reputation and results of operations.

• Its inability to successfully implement some or all the company`s business strategies in a timely manner or at all could have an adverse effect on its business. Further, the company failures to manage growth effectively may adversely impact its business, results of operations and financial condition.

• The success of its business and operations are dependent upon certain quality accreditations which are valid for a limited time period. An inability to renew such accreditations in a timely manner, or at all, may adversely affect its business and prospects. We are subject to quality requirements and strict technical specifications and audits by the company`s customers.

• The company operates in a competitive environment and may not be able to effectively compete due to various factors not under its control, which could have a material adverse effect on its business, results of operations and financial condition.

• The company requires sizeable amounts of working capital for its continued operation and growth. The company`s inability to meet its working capital requirements could have a material adverse effect on its business, results of operations and financial condition.

• The companay is dependent upon the experience and skill of its management team and a number of key managerial personnel. If the company is unable to attract or retain such qualified personnel, this could adversely affect its business, results of operations and financial condition.

• Its business is subject to seasonal volatility which may contribute to fluctuations in its results of operations and financial condition.

• Its Group Companies are authorised to engaged in activities which is similar to the company`s business. This may be a potential source of conflict of interest for it and which may have an adverse effect on its business, financial condition and results of operations.

• Information relating to the installed and utilisable manufacturing capacity of its processing facility included in this Red Herring Prospectus are based on various assumptions and estimates and future production and capacity may vary.

• Its business may be adversely affected if the company is unable to maintain and grow its brand image. In particular, the company failures to maintain certain licenses or certifications may negatively impact its brand and reputation.

• Its insurance coverage may not adequately protect the company against all losses or the insurance cover may not be available for all the losses as per the insurance policy, which could adversely affect business, results of operations and financial condition.

• Non-compliance with and changes in, safety, health and environmental laws and other applicable regulations, may adversely affect its business, results of operations and financial condition.

• Any inability to accurately manage inventory and forecast demand for particular products in specific markets may have an adverse effect on its business, results of operations and financial condition.

• The company is dependent on third parties for the supply of utilities, such as fuel and electricity, at its manufacturing facility and any disruption in the supply of such utilities could adversely affect its manufacturing operations.

• Its contingent liabilities could materially and adversely affect the company`s business, results of operations and financial condition.

• The company does not own its registered office.

• The objects of the Issue include orders for plant and machinery which have not yet been placed. In the event of any delay in placement of such orders, the proposed schedule of implementation and deployment of the Net Proceeds may be extended or may vary.

• Its Corporate Promoter Indrayani Biotech Limited does not possess the relevant experience in dairy industry.

• The company has acquired land from one of its Promoter during the past 5 years.

• Delays or defaults in client payments could adversely affect its operations.

• The company has not yet applied for registration of its logo and the company does not own the "corporate logo" legally as on date.

• Technology failures or advancements could disrupt its operations and adversely affect the company`s business operations and financial performance.

• Its processing operations are dependent upon availability of skilled and unskilled labour.

• The company engage contract labour for carrying out certain business operations.

• The company faces foreign exchange risks that could adversely affect its results of operations as a portion of the company revenue and expenditure is denominated in foreign currencies.

• An inability to comply with repayment and other covenants in the financing agreements or otherwise meet its debt servicing obligations could adversely affect its business, financial condition, cash flows and credit rating.

• The Company has unsecured loans that may be recalled by the lenders at any time and the Company may not have adequate funds to make timely payments or at all.

• Its employees may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements.

• The company has in the past entered into related party transactions and may continue to do so in the future, which may potentially involve conflicts of interest with the equity shareholders.

• The Company has issued Equity Shares in the last 12 months at a price which may be lower than the Issue Price.

• Its Promoters, certain of the company Directors and Key Managerial Personnel may have interests other than reimbursement of expenses incurred and normal remuneration or benefits in the Company.

• After the completion of the Issue, its Promoters and members of Promoter Group will continue to collectively hold substantial shareholding in the Company.

• The company cannot assure payment of dividends on the Equity Shares in the future.

• Its Promoter and Promoter Group members has provided personal guarantees and mortgage personal property for loans availed by the Company. Its business, financial condition, results of operations, cash flows and prospects may be adversely affected by the invocation of all or any personal guarantees provided by its Promoter and Promoter Group members.

• The company has not identified any alternate source of funding and hence any failure or delay on its part to mobilize the required resources or any shortfall in the Issue proceeds may delay the implementation schedule.

• The Objects of the Issue for which funds are being raised have not been appraised by any bank or financial institution. Any variation between the estimation and actual expenditure as estimated by the management could result in execution delays or influence its profitability adversely.

• There is no monitoring agency appointed by the Company to monitor the utilization of the Issue proceeds.

• The company has not independently verified certain data in this Red Herring Prospectus.

• Any future issuance of Equity Shares, or convertible securities or other equity linked securities by it and any sale of Equity Shares by the company significant shareholders may dilute your shareholding and adversely affect the trading price of the Equity Shares.

• The Issue price of its Equity Shares may not be indicative of the market price of the company Equity Shares after the Issue and the market price of its Equity Shares may decline below the issue price and you may not be able to sell your Equity Shares at or above the Issue Price.