Emerald Tyre

Risks

• The company`s ability to secure raw materials at favorable prices is subject to market fluctuations. Any increase in raw material costs could significantly impact its sales, profitability, and overall performance.

• Its business is dependent on a few of the company clients who contribute to significant of its revenues from operations. Any loss of business from them may adversely affect its revenues and profitability.

• Its operational efficiency is closely linked to the consistent supply of raw materials, sourced from a selected group of suppliers. Any potential interruption in the flow of raw materials from these suppliers could pose challenges to its operations.

• Significant portions of its revenue hinges upon a selected group of clienteles, and the potential loss of any of these key customers may substantially impact its business operations and profitability.

• There have been certain lapses and discrepancies and/or typographical errors in Statutory filings. the company cannot assure you that no regulatory action will be initiated against it and that no penalties will be imposed on the company on account of these lapses.

• Its may not be able to continue investing to increase existing capacities in order to meet the market requirements, capitalize on the new opportunities available or to drive future growth.

• Inadequate inventory management may pose risks to its business performance, affecting the company sales, profitability, and financial health.

• Competition may result in the reduction of its market share or margins, either of which could adversely affect its business or results of operations.

• The fund requirement and deployment are based on internal management estimates and have not been appraised by any bank or financial institution. These are based on current conditions and are subject to change in light of changes in external circumstances or costs, other financial conditions, business or strategy.

• Company may be not be able to procure Equipment at costs as specified in "Objects to Offer" Chapter.

• Inherent risk for expanding its business internationally which may potentially impact its financial standing and operational performance.

• In past, there has been instances of delayed filing of Statutory Returns.

• The seamless functioning of its manufacturing facilities stands as a cornerstone of its operations, playing a pivotal role in sustaining the company`s business. Any interruptions in their operation could potentially pose significant challenges to its business continuity, financial health, and operational performance.

• The company has incurred indebtedness, and an inability to comply with repayment and other covenants in its financing agreements could adversely affect the company`s business and financial condition.

• Its inability to collect receivables and defaults in payment from its customers could result in the reduction of the company`s profits and affect its cash flows.

• The Company has experienced negative cash flow in the past and may continue to do so in the future, which could have a material adverse effect on its business, prospects, financial condition, cash flows and results of operations.

• Its main operations may be adversely affected in case of industrial accidents at its manufacturing unit and also Rubber is a combustible commodity which may lead to any fire mishaps or accidents could lead to property damages, property loss and accident claims.

• The Company has availed certain unsecured loans which may be recalled at any time.

• Its dependence on the company`s Subsidiaries exposes it to significant operational and financial risks.

• The company operates within a regulatory framework governed by stringent labour laws which could potentially impact its operations.

• The Company`s name & logo and Brand names are not registered trademark.

• There are outstanding legal proceedings involving the Company, Promoter and one of its KMP. Any unfavourable development in these proceedings or in other proceedings in which the company become involved could have a material adverse effect on its business, financial condition and results of operations and the price of its Equity Shares.

• Potential risks inherent in its operations demand careful consideration. Accidents within the company facilities or during its operational activities pose significant liabilities, potentially impacting our revenues and expenses.

• If the company encounter challenges in executing its production schedules efficiently, it could significantly impact its business and financial performance.

• Volatility in energy and fuel expenses poses a potential risk to its business, financial performance, and cash flow.

• The continued success of its business heavily relies on the expertise and dedication of the company management team and operational workforce. Any challenges in retaining them could potentially impact its operations negatively.

• Late Submission or Non-compliance with environmental, labour, and occupational health and safety laws, as well as other regulations applicable to its operations, could pose significant risks to the company`s business.

• The company`s success is significantly influenced by the strength of its brands and the perception they hold in the market. Any decline in their reputation or market perception, coupled with ineffective sales and marketing strategies, could potentially impact its sales, profitability, and hinder the execution of its growth plans.

• The company faces the risk of incurring significant liabilities due to uninsured losses, which could have adverse effects on its financial health.

• Foreign exchange fluctuations could result in financial losses that could adversely affect its results of operations and cash flows.

• The requirements of being a listed company may strain its resources.

• The company has certain contingent liabilities which, if materialized, may adversely affect its financial condition.

• The company has engaged in transactions with related parties in the past and may continue to do so in the future.

• The company has paid dividends in the fiscal years 2024, and 2022 on Equity and preference shares respectively. However, it`s crucial to note that its ability to continue paying dividends in the future may hinge on several factors, including its forthcoming earnings, financial health, cash flows, working capital needs, capital investments, and the terms of its financing agreements.

• The company does not own all the premises from which its operate, and continuous and uninterrupted use and possession of such premises are subject to certain conditions.

• Its consolidated net revenue will be adversely affected if the Government reduces or withdraws tax benefits and other incentives it currently provides to it or otherwise increases the company`s effective tax rate.

• If the company inadvertently infringe upon the intellectual property rights of others, its business and results of operations may be adversely affected.

• Rapid advancements in technology pose a significant risk to its current operations and financial stability.

• Its Promoter and certain Directors hold Equity Shares in the Company, thereby aligning their interests with the company`s performance alongside their regular compensation and expense reimbursements.

• The company export its products to various countries, on account of which the company may be subject to significant import duties or restrictions in the jurisdictions its export to. Further, unavailability of fiscal benefits enjoyed by the company or its inability to comply with related requirements may have an adverse effect on its business and results of operations.

• Employee misconduct, errors, or fraudulent activities pose significant risks to its business operations, financial stability, and reputation. Such instances could lead to regulatory penalties, damage its standing in the market, and undermine investor confidence.

• Its lenders have charge over its fixed assets in respect of finance availed by the company.

• Its business primarily operates on a purchase order basis without long-term contractual commitments with its customers.

• The occurrence of COVID-19 or any other severe communicable disease poses a potential threat to its business, financial health, and operational outcomes.

• Its Promoter and members of the Promoter Group will continue jointly to retain majority control over the Company even after the Offer which will allow them to determine the outcome of matters submitted to shareholders for approval.

• There have been certain lapses and non-compliances under Factories Act, 1948. We cannot assure you that no regulatory action will be initiated against it and that no penalties will be imposed on the company on account of these lapses.

• Potential conflicts of interest may arise if its Promoter or Directors engage in business activities that compete with or align closely with its own operations.

• The Company does not have a designated monitoring agency to oversee the utilization of the Offer proceeds.

• The trading price of its Equity Shares may experience fluctuations and the development of an active trading market cannot be guaranteed.

• The company strive to ensure that its equity shares shall be listed on the SME platform of the National Stock Exchange (NSE) in a timely manner, however, the company cannot assure the listing of the proposed shares. This may impact investors ability to sell or dispose of their equity shares.

• The Offer price of its Equity Shares may not necessarily reflect their market value post-Offer, and there is a possibility that the market price could fall below the Offer price, potentially affecting your ability to sell shares at or above the Offer Price.

• Sale of Equity Shares by its Promoter or other significant shareholder(s) may adversely affect the trading price of the Equity Shares.

• Following the issuance of its Equity Shares, it is important to acknowledge the potential for significant volatility in their price, and the possibility that an active trading market may not immediately materialize.