Indobell Insul.

Risks

• The Company, Directors, Promoters and Group Companies are parties to certain legal proceedings. Any adverse decision in such proceedings may have a material adverse effect on its business, results of operations and financial condition.

• If the company is unable to successfully implement its proposed development plans; the company results of operations and financial condition could be adversely affected.

• The Company is yet to place orders for the machinery for the expansion of the Manufacturing Facility. Any delay in placing orders or procurement of such machinery may delay the schedule of implementation and possibly increase the cost of commencing operations.

• Under-utilization of its manufacturing capacities and an inability to effectively utilize the company existing manufacturing capacities could have an adverse effect on its business, future prospects and future financial performance.

• Its revenue is dependent on single business segment i.e. Thermal Insulation Products. An inability to anticipate or adapt to evolving upgradation of these products or inability to ensure product quality or reduction in the demand of these products may adversely impact its revenue from operations and growth prospects.

• The Company maintains high level of inventory for uninterrupted production activities.

• Substantial portion of its revenues has been dependent upon few customers. The loss of any one or more of its major customers would have a material effect on the company`s business operations and profitability.

• The company`s business is dependent on certain suppliers and the loss of one or more of them would have a material adverse effect on the business.

• The Company had negative cash flow in recent fiscals, details of which are given below. Sustained negative cash flow could adversely impact its business, financial condition and results of operations.

• The company faces competition, including from other large and established competitors, and its may fails to compete successfully against existing or new competitors, which may reduce the demand for the company Products which may lead to reduced prices, operating margins, profits and further result in decline in revenue.

• The company faces competition from substitutes of its products and if consumers` preferences for any of these substitutes increases it could lead to a reduction in the demand for the company products, which could have a material adverse effect on its business, financial condition and results of operations.

• There are certain discrepancies noticed in some of its corporate records relating to forms filed with the Registrar of Companies.

• There have been some instances of delayed filing of returns and depositing of statutory dues with regulatory authorities"

• Certain relevant copies of educational qualification and experience certificates of its promoters/Directors are not traceable.

• The company lenders have charge over its movable properties, book debts, stocks in respect of finance availed by it.

• Non-availability of initial period secretarial /statutory records of the company filed with ROC since incorporation.

• The availability of look-alikes, counterfeit products, primarily in its domestic markets, manufactured by other companies and passed off as its products, could adversely affect the company goodwill and results of operations.

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

• Its ability to protect or use intellectual property right may adversely affect its business.

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

• Its continued operations at the company manufacturing facilities are critical to its business and any disruption, breakdown or failures of machinery, disruption to power sources or any temporary shutdown of its manufacturing facility, may have a material adverse effect on the company business, results of operations, financial condition and cash flows.

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

• The company has issued Equity Shares in the last 12 (twelve) months at a price which is lower than the Issue Price.

• The company has certain contingent liabilities, which, if materialized, may affect its financial condition and results of operations.

• The company does not own the certain premises which its use for the purpose of the company business operations.

• Orders placed by customers may be delayed, modified, cancelled or not fully paid for by its customers, which may have an adverse effect on the company business, financial condition and results of operations.

• The company has not entered into any long-term contracts with any of its clients.

• The Company has significant portion of Property Plant and Equipment. Any destruction, breakdown, theft of its major plants or equipment or failures to repair or maintain the same may adversely affect its business, cash flows, financial condition and results of operations.

• Delays or defaults in customer payments could adversely affect its financial condition.

• 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.

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

• As the company continue to grow, its may not be able to effectively manage the company growth and the increased complexity of its business, which could negatively impact the company brand and financial performance.

• Any failures on its part to effectively manage the company inventory may result in an adverse effect on its business, revenue from manufacturing operations and financial condition.

• Its insurance coverage may not be adequate to protect the company against certain operating hazards and this may have a material adverse effect on its business.

• The company is subject to strict quality requirements and are consequently required to incur significant expenses to maintain its product quality. Any failures to comply with such quality standards may lead to cancellation of existing and future orders which may adversely affect its reputation, financial conditions, cash flows and results of operations.

• Its Promoters have provided personal guarantees 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.

• Its directors and certain Key Management Personnel hold Equity Shares in the Company and are therefore interested in the Company`s performance in addition to their remuneration and reimbursement of expenses.

• Information in relation to its installed capacity and capacity utilization of the company manufacturing facility included in this Prospectus is based on various assumptions and estimates, and future production and capacity utilization may vary.

• An inability to renew quality accreditations in a timely manner or at all, or any deficiencies in the quality of its products may adversely affect the company`s business prospects and financial performance.

• Its operations are subject to high working capital requirements. If the company is unable to generate sufficient cash flows to allow it to make required payments, there may be an adverse effect on its results of operations.

• Its business operations are majorly concentrated in certain geographical regions and any adverse developments affecting its operations in these regions could have a significant impact on the company revenue and results of operations.

• The future operating results are difficult to predict and may fluctuate or adversely vary from the past performance.

• Portion of its Issue Proceeds are proposed to be utilized for general corporate purposes which constitute 6.90% of the Issue Proceed.

• The company has not made any alternate arrangements for meeting its regular working capital requirements. If its unable to manage /arrange funds (including at short notice) to meet its working capital requirements, there may be an adverse effect on the company results of operations and financial performance.

• In addition to its existing indebtedness for the company operations, its may be required to obtain further loan during the course of business. There can be no assurance that the company would be able to service its existing and/or additional indebtedness.

• Its debt financing agreements contain certain restrictive covenants that may adversely affect the Company`s business, credit ratings, prospects, results of operations and financial condition.

• Underutilization of capacity of its facility may adversely affect the company business, results of operations and financial conditions.

• The company is subject to certain government regulation and if its fail to obtain, maintain or renew the company statutory and regulatory licenses, permits and approvals required to operate its business, the company business and results of operations may be adversely affected.

• The company is subject to risks arising from interest rate fluctuations, which could adversely affect its business, financial condition and results of operations.

• Its success depends largely on the company Directors, Promoters and other key managerial personnel and the loss of or its inability to attract or retain such persons with specialized technical know-how could adversely affect its business, results of operations, cash flows and financial condition.

• Its success depends heavily upon the company Promoters and Directors for their continuing services, strategic guidance and financial support.

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

• The company could be harmed by employee misconduct or errors that are difficult to detect and any such incidences could adversely affect its financial condition, results of operations and reputation.

• Its may not be successful in implementing the company business strategies.

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

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

• Upon completion of the Issue, its Promoters may continue to retain significant control, which will allow them to influence the outcome of matters submitted to the shareholders for approval.

• Within the parameters as mentioned in the chapter titled "Objects of this Issue" beginning on page 76 of this Prospectus, the Company`s management will have flexibility in applying the proceeds of this Issue subject to applicable laws. The fund requirement and deployment mentioned in the Objects of this Issue have not been appraised by any bank or financial institution.

• Industry information included in this prospectus has been derived from industry reports. There can be no assurance that such third-party statistical, financial and other industry information is either complete or accurate.

• 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.

• Certain key performance indicators for certain listed industry peers included in this Prospectus have been sourced from public sources and there is no assurance that such financial and other industry information is complete.

• The company is dependent on third party transportation providers for procuring raw material from its suppliers and delivery of products to the company clients. Any failures on the part of such service providers to meet their obligations could have a material adverse effect on its business, financial condition and results of operation.

• The company is required to furnish bank guarantees to its certain clients. The company inability to arrange such guarantees or the invocation of such guarantees may adversely affect its cash flows and financial condition.

• Its business is subject to seasonal and other fluctuations that may affect the company cash flows and business operations.

• Any reduction in the demand for its products could lead to underutilisation of the company manufacturing capacity.

• Its may faces significant competition in the company business. An inability to compete effectively may lead to a lower market share or reduced operating margins.

• The Company may face risks associated with business transactions with Government Entities.

• Its management will have broad discretion in how the company apply the Net Proceeds of the Issue and there is no assurance that the Objects of the Offer will be achieved within the time frame expected, or at all, or that the deployment of Net Proceeds in the manner intended by it will result in an increase in the value of your investment.

• The Company has availed certain unsecured loan which can be recalled at any time.

• The company is subject to risks resulting from foreign exchange rate fluctuations, which could adversely affect its results of operations.

• Excessive dependence on State Bank of India in respect of Loan facilities obtained by the Company.

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

• In the event there is any delay in the completion of the Issue, there would be a corresponding delay in the completion of the objects of this Issue which would in turn affect its revenues and results of operations.

• There is no guarantee that its Equity Shares will be listed on the SME Platform of BSE Limited in a timely manner or at all.

• The Issue Price of its Equity Shares may not be indicative of the market price of the company Equity Shares after the Issue.

• After this Issue, the price of its Equity Shares may be volatile, or an active trading market for the company Equity Shares may not be sustained.

• The investors will not be able to sell immediately on an Indian stock exchange any of the Equity Shares they purchase in the Issue.

• There are restrictions on daily movements in the price of the Equity Shares, which may adversely affect a shareholder`s ability to sell, or the price at which it can sell, Equity Shares at a particular point in time.

• Any future issuance of Equity Shares may dilute the investors` shareholdings or sales of its Equity Shares by our Promoters or Promoter Group may adversely affect the trading price of the company Equity Shares.

• The Company has been paying dividends in past 6 years and till now but there can be no assurance that its will pay dividends in future.

• You may be subject to Indian taxes arising out of capital gains on sale of Equity Shares.

• Applicants to this Issue are not allowed to withdraw their Applications after the Issue Closing Date.

• The investors may be restricted in their ability to exercise pre-emptive rights under Indian law and may be adversely affected by future dilution of their ownership position.

• Rights of shareholders under Indian law may be more limited than under the laws of other jurisdictions.

• Its Equity Shares are quoted in Indian Rupees in India, and therefore investors may be subject to potential losses arising out of exchange rate risk on the Indian Rupee and risks associated with the conversion of Indian Rupee proceeds into foreign currency.