Indian

Risks

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

• Its reliance on certain industries for a significant portion of the company sales could have an adverse effect on its business.

• The property used by the Company for the purpose of its operations and storage is not owned by it. Any termination of the relevant lease agreement or rent agreement in connection with such property or its failure to renew the same could adversely affect the company`s operations.

• The company`s business is dependent and will continue to depends on its manufacturing facilities, and the company is subject to certain risks in its manufacturing process. Any slowdown or shutdown in the company`s manufacturing operations or strikes, work stoppages or increased wage demands by its employees that could interfere with the company`s operations could have an adverse effect on its business, financial condition and results of operations.

• The company derives a significant part of its revenue from major customers. If one or more of such customers choose not to source their requirements from it or to terminate their contracts with the company, its business, financial condition and results of operations may be adversely affected.

• Its top five suppliers contribute majority of the company purchases. Any loss of business with one or more of them may adversely affect its business operations top five suppliers contribute and profitability.

• Its manufacturing process involves the use of hazardous and flammable industrial chemicals which entails significant risks and could also result in enhanced compliance obligations.

• The Company requires significant amounts of working capital for a continued growth. Its inability to meet the company working capital requirements may have an adverse effect on its results of operations.

• The Company is yet to place orders for 100% of the plant & machineries for its proposed object, as specified in the Objects of the Issue. Any delay in placing orders, procurement of plant & machineries may delay its implementation schedule and may also lead to increase in price of these plant & machineries, further affecting its revenue and profitability.

• The capacity of its current plant units is not fully utilized. Consecutively, if there is also any underutilization of its capacities in upcoming years, it could affect the company`s ability to fully absorb fixed costs and thus may adversely impact its financial performance.

• The Company has been recently incorporated in December 05, 2020 thus the company has limited operating history as a Company which may make it difficult for investors to evaluate its historical performance or future prospects.

• There are certain discrepancies in its corporate compliances and its may be subjected to penalty in such event.

• The Company has delayed the filing of annual audited financial statements and the payment towards its Employees Provident Fund (EPF) dues.

• The company is subject to strict quality requirements and any product defect issues or failure by the company or its raw material suppliers to comply with quality standards may lead to the cancellation of existing and future orders, recalls and exposure to potential product liability claims.

• In case of its inability to obtain, renew or maintain the statutory and regulatory licenses, permits and approvals required to operate its business it may have a material adverse effect on the company`s business.

• There are certain discrepancies in its corporate compliances and the company may be subjected to penalty in such event.

• One of its Directors Rajesh Madhukar Joshi was disqualified in past for being Director Under Section 164 of the Companies Act, 2013 due to non-filing of Annual returns and Financial statements of M/s. Sky Home Niwas Private Limited where he was a Director.

• The company operates in a highly competitive industry. Any inability to compete effectively may lead to a lower market share or reduced operating margins.

• Inventories and trade receivables form a major part of its current assets. Failure to manage its inventory and trade receivables could have an adverse effect on its sales, profitability, cash flow and liquidity.

• The company is subject to increasingly stringent environmental, health and safety laws, regulations and standards. Noncompliance with and adverse changes in health, safety, labour, and environmental laws and other similar regulations to its manufacturing operations may adversely affect the company`s business, results of operations and financial condition.

• The company is subject to increasingly stringent environmental, health and safety laws, regulations and standards. Noncompliance with and adverse changes in health, safety, labour, and environmental laws and other similar regulations to its manufacturing operations may adversely affect the company`s business, results of operations and financial condition.

• Its existing manufacturing facility are concentrated in a single region i.e., Lote, Maharashtra and the inability to operate and grow its business in this particular region may have an adverse effect on its business, financial condition, results of operations, cash flows and future business prospects.

• Improper handling of its products, or spoilage and damage to the company products, could damage its reputation and may have an adverse effect on the company`s business, results of operations and financial condition.

• Its insurance coverage may not adequately protect the company against all material hazards, which may adversely affect its business, results of operations and financial condition.

• The company does not have long-term agreements with suppliers for its raw materials and an increase in the cost of, or a shortfall in the availability or quality of such raw materials could have an adverse effect on its business, financial condition and results of operations.

• Any shortages, delay or disruption in the supply of the raw materials the company use in its manufacturing process due to factors beyond the company control may have a material adverse effect on its business, financial condition, results of operations and cash flows.

• The average cost of acquisition of Equity shares by its Promoter is lower than the Issue price. Its promoter average cost of acquisition of Equity shares in the Company is lower than the Issue Price of Equity shares as given below.

• The company faces competition from both domestic as well as multinational corporations and its inability to compete effectively may have a material adverse impact on its business, financial condition and results of operations.

• In addition to normal remuneration, other benefits and reimbursement of expenses to its Promoter and Directors; they are interested to the extent of their shareholding and dividend entitlement thereon in the Company and for the transactions entered into between the Company and themselves as well as between the Company and its Group Companies / Entities.

• The Company has in the past entered into related party transactions and may continue to do so in the future and the company cannot assure you that its could not have achieved more favourable terms if such transactions had not been entered into with related parties and will not have an adverse effect on its financial conditions and result 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, its inability to effectively manage any of these issues may adversely affect its business growth and, as a result, impact the company`s businesses, financial condition and results of operations.

• The Company has made application for registration of trademark, which is under process of registration. The company is unable to assure that the future viability or value of any of its intellectual property or that the steps taken by it to protect the proprietary rights of the company Company will be adequate.

• If the company is unable to manage its growth effectively and further expand into new markets its business, future financial performance and results of operations could be materially and adversely affected.

• The Company has in the past entered into related party transactions and may continue to do so in the future and the company cannot assure you that its could not have achieved more favourable terms if such transactions had not been entered into with related parties and will not have an adverse effect on its financial conditions and result of operations.

• Its loan agreements with various lenders have several restrictive covenants and certain unconditional rights in favour of the lenders, which could influence its ability to expand, in turn affecting the company`s business and results of operations.

• Unsecured loans taken by the Company can be recalled by the lenders at any time.

• The Company had negative cash flows in the past years, details of which are given below. Sustained negative cash flow could impact its growth and business.

• The Company requires significant amounts of working capital for a continued growth. Its inability to meet the company working capital requirements may have an adverse effect on its results of operations.

• The Company is yet to place orders for 100% of the plant & machineries for its proposed object, as specified in the Objects of the Issue. Any delay in placing orders, procurement of plant & machineries may delay its implementation schedule and may also lead to increase in price of these plant & machineries, further affecting its revenue and profitability.

• The company has significant ongoing funding requirements and may not be able to raise additional capital in the future. As a result, the company may not be able to respond to business opportunities, challenges or unforeseen circumstances.

• The company may requires further equity issuance, which will lead to dilution of equity and may affect the market price of its Equity Shares or additional funds through incurring debt to satisfy its capital needs, which the company may not be able to procure and any future equity offerings by the company.

• Compliance with, and changes in, safety, health and environmental laws and various labour, workplace and related laws and regulations impose additional costs and may increase its compliance costs and a such adversely affect the company results of operations and our financial condition.

• Its management has discretion in how it may use the proceeds of the Issue. Any variation in the utilisation of its Net Proceeds would be subject to certain compliance requirements, including prior shareholders` approval.

• The company requires 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.

• Any IT system failures or lapses on part of any of its employees may lead to operational interruption, liabilities or reputational harm.

• If the company`s security measures are compromised, its products and services would be perceived as vulnerable, its brand and reputation would be damaged and customers could stop using its products and services, all of which would materially adversely affect it.

• Its Object has not been appraised by any Bank or Financial Institution. Any significant deviation in the Object could adversely impact its operations and sustainability in absence of any independent monitoring agency.

• Its Group Companies has incurred losses during the last three financial years.

• There is no monitoring agency appointed by the Company and the deployment of funds are at the discretion of its Management and the company Board of Directors, though it shall be monitored by its Audit Committee.

• Its business is dependent on the company continuing relationships with its clients, with whom the company has not entered into long term arrangements.

• Its continued success is dependent upon the company`s ability to hire, retain, and utilize qualified personnel.

• Its insurance coverage may be inadequate to satisfy future claims against it.

• Its success largely depends on the company`s Board and Key Managerial Personnel and its ability to attract and retain them. Any loss of the company director and key managerial personnel could adversely affect its business, operations and financial condition.

• The company has not made any alternate arrangements for meeting its capital requirements for the Objects of the issue. Further the company has not identified any alternate source of financing the "Objects of the Issue". Any shortfall in raising / meeting the same could adversely affect its growth plans, operations and financial performance.

• Certain information contained in this Red Herring Prospectus is based on management estimates and the company cannot assure you of the completeness or accuracy of the data.

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

• Failure to manage its stocks could have an adverse effect on the company`s net sales, profitability, cash flow and liquidity.

• The company could be exposed to risks arising from misconduct, fraud and trading errors by its employees and Business Associates.

• QIBs and Non-Institutional Bidders are not permitted to withdraw or lower their Bids (in terms of quantity of Equity Shares or the Bid Amount) at any stage after submitting a Bid and Retail Individual Investors are not permitted to withdraw their Bids after Bid/Issue Closing Date.