Innova Captab Ltd IPO

Expansion of its manufacturing capacities.

Integration of the acquired Sharon business.

Expand the wallet share of existing customers and develop new customers.

Continued focus on its R&D operations.

Growing its international export business.

Expanding its domestic branded generics business.

Growth through strategic acquisitions.

leading presence and one of the fastest growing CDMOs in the Indian pharmaceutical formulations market.

Well established relationships with its marquee CDMO customer base.

Highly efficient operations, including its world class manufacturing facilities and supply chain.

Rapidly growing domestic and international export branded generics businesses.

Strong R&D focus to build an increasingly complex product portfolio and attract and retain customers.

Consistent financial performance.

Experienced promoters and management team.

Its Restated Consolidated Financial Information are not comparable on a period-to-period basis and to any future financial results that its may prepare and further, the company Pro Forma Condensed Consolidated Financial Information have not been prepared in accordance with generally accepted accounting principles including accounting standard and therefore, is subject to change and may not give an accurate picture of its factual results of operations or financial condition.

The company operate in a market that is highly competitive. Its compete to provide outsourced pharmaceutical manufacturing services or CDMO services and products, particularly for formulations, to pharmaceutical companies in India and other jurisdictions. In addition, its branded generic products compete with generic products of other suppliers in India and other jurisdictions.

The company has recently acquired Sharon, and does not yet know whether it will achieve the expected benefits from such acquisition, which could materially adversely affect its business, results of operation, cash flows and financial condition.

Its business is dependent and will continue to depend on the company manufacturing facilities, and its subject to certain risks in the company`s manufacturing process such as the breakdown or failure of equipment, industrial accidents, severe weather conditions and natural disasters.

The company depends on a limited number of contract development and manufacturing organization ("CDMO") customers. Any reduction in the number of CDMO customers and adverse developments or inability to enter into or maintain relationships with these CDMO customers could have an adverse effect on its business, results of operations and financial condition.

Failure to comply with the quality requirements and technical specifications prescribed by its customers may lead to loss of business from such customers and could negatively impact its business, results of operations and financial condition, including cancellation of existing and future orders which may expose it to warranty claims.

Its funding requirements and proposed deployment of the Net Proceeds are based on management estimates and may be subject to change based on various factors, some of which are beyond its control.

The company has incurred significant capital expenditure during the last three Fiscal Years and the three months ended June 30, 2023. Its may require substantial financing for the company`s business operations and planned capital expenditure and the failure to obtain additional financing on terms commercially acceptable to it may adversely affect its ability to grow and the company future profitability.

Its dependence on China, China SEZ and Hong Kong for the company raw material supplies exposes it to political, economic and social conditions in greater China.

Its business is capital intensive. Any insufficient cash flows from its operations or inability to borrow to meet the company working capital requirements, it may materially and adversely affect its business and results of operations.

The company is required to transfer, obtain, renew or maintain statutory and regulatory permits, licenses and approvals connected with Sharon`s business that became a wholly owned subsidiary of UML as of June 30, 2023, and any delay or inability in transferring, renewing or maintaining such permits, licenses and approvals could adversely affect its business, results of operations and financial condition.

The company is subject to risks associated with rejection of supplied products, and consequential claims and associated product liability costs due to defects in its products, which could generate adverse publicity or adversely affect its business, results of operations or financial condition.

Any shortfall in the supply of its raw materials or an increase in the company raw material costs, or other input costs, may adversely affect the pricing and supply of its products and adversely affect its business, results of operations and financial condition.

Reforms in the healthcare industry and the uncertainty associated with pharmaceutical pricing, reimbursement and related matters could adversely affect the pricing and demand for its products as well as the consumer demand for the products its manufacture for the company customers, which may significantly influence its business, results of operations and financial condition. Further, its business and results of operations may be adversely impacted due to the price ceiling imposed by the Government.

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. In Fiscal 2023 and in the three months ended June 30, 2023, its derived 10.72% and 8.88%, respectively, of the company revenue from operations on a restated consolidated basis from related party transactions.

The company is required to obtain, renew or maintain statutory and regulatory permits, licenses and approvals to operate its business, and any delay or inability in obtaining, renewing or maintaining such permits, licenses and approvals could result in an adverse effect on its results of operations.

The pharmaceutical market is subject to extensive regulation and failures to comply with the existing and future regulatory requirements in any pharmaceutical market could adversely affect its business in that market, results of operations and financial condition.

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.

Any failure of the third parties, on whom its relies for clinical trials, in performing their obligations and complying with regulatory standards could result in a delay in receiving regulatory approval and adversely affect its business, financial condition and results of operations.

The company is dependent on its R&D activities for its future success. If the company does not successfully develop new products or continue its generic product portfolio expansion in a timely and cost-effective manner, its business, results of operations and financial condition may be adversely affected.

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

The company relies on its distributors and stockists for the sale and distribution of the company products. A termination of its sales arrangements or if its distributors and stockists do not effectively sell or market its products, the company business, results of operations and financial condition may be adversely affected.

Its proposed capacity expansion plans relating to the company manufacturing facilities are subject to the risk of unanticipated delays in implementation and cost overruns.

The company is required to comply with the applicable regulations of the international markets where its export the company products as well as obtain registrations from international agencies through its customers to enable exports of its products to other jurisdictions. Further, its international operations are subject to regulatory risks that could adversely affect its business, results of operations and financial condition.

The company is dependent upon the experience and skill of its management team and a number of key managerial personnel as well as on its ability to attract and retain personnel with technical expertise. 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 inability to collect receivables and default in payment from the company customers could result in the reduction of its profits and affect the company cash flows.

Its failure to manage growth effectively may adversely impact its business, results of operations and financial condition.

Its manufacturing and R&D facilities are located in Himachal Pradesh exposing it to regulatory and other geography specific risks such as labour unrests, terrorist attacks, other acts of violence and occurrence of natural and man-made disasters.

Its may face labour disruptions that could adversely affect the company`s business, results of operations and financial condition.

There is pending litigation against the Company, Promoters, Subsidiaries and certain of its Directors. Any adverse decision in such proceedings may render it/them liable to liabilities/penalties and may adversely affect its business, results of operations and financial condition.

The company face foreign exchange risks that could adversely affect its results of operations as a portion of its revenue is from exports and a portion of the company expenditure is from imports of raw material, both of which are denominated in foreign currencies.

Its contingent liabilities on a restated consolidated basis could materially and adversely affect its business, results of operations and financial condition.

If the company is unable to protect its intellectual property rights, the company business, results of operations and financial condition may be adversely affected. Further, if its products were found to be infringing on the intellectual property rights of a third-party, the company could be required to cease selling the infringing products, causing it to lose future sales revenue from such products and face substantial liabilities for patent infringement.

The company may not be able to effectively integrate the businesses that its acquire.

Its Subsidiary Sharon is currently suspended from trading in the Stock Exchanges. Further, Sharon is yet to receive approval to delist its shares from the Stock Exchanges as part of the corporate insolvency resolution plan.

The cost of implementing new technologies for its operations could be significant and could adversely affect its business, results of operations and financial condition.

Any inability or delay in launching new generic pharmaceutical products, if pharmaceutical companies or other third parties are successful in limiting the use of generic through their legislative, regulatory and other efforts, including patent extensions, its business, results of operations, and financial condition may be adversely affected.

If any of its products or products the company manufacture for its customers cause, or are perceived to cause, side effects, its business, results of operations and financial condition could be adversely affected.

Any surplus production on account of inaccurate forecasting of customer requirements and failure to manage inventory could adversely affect its business, results of operations and financial condition.

The company track certain operational metrics with internal systems and tools. Certain of its operational metrics are subject to inherent challenges in measurement which may adversely affect its business and reputation. Further, such information of the company performance is not required by Ind AS.

Its Statutory Auditors have included certain CARO statements and comments in its consolidated audited financial statements as at, and for the fiscal years ended, March 31, 2023 and March 31, 2022, and in its standalone audited financial statements as at, and for the fiscal year ended, March 31, 2021.

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

Its outsource packaging of the company products to Nugenic Pharma Private Limited which is part of its Promoter Group and that exposes it to conflicts of interest.

Failure or disruption of its IT, manufacturing automation systems and/or ERP systems may adversely affect its business, results of operations and financial condition.

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

The company does not own certain of the premises of its manufacturing facilities and administration offices.

Any downgrade of its debt ratings could adversely affect the company`s business.

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

The availability of counterfeit generic products passed off by others as its products, could adversely affect the company reputation, goodwill and results of operations.

The company currently avail benefits under certain export promotion schemes. Any change in these benefits applicable to it or a delay in disbursement of benefits under such schemes may affect its results of operations.

Failure to maintain confidential information of its CDMO customers could adversely affect the company results of operations or damage its reputation.

Any 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. Further, the Company has availed unsecured loans which are repayable on demand.

The employees, suppliers, distributors and stockists may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements.

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

One of its Directors is interested in certain entities which are in businesses similar to its and this may result in conflict of interest with it. Additionally, conflicts of interest may arise out of common business objects among the Company, Subsidiaries and its Group Companies.

There has, in the past, been an instance of non-compliance by our Company under Indian company laws, for which the company has not received condonations from the relevant authorities.

Its Promoters have provided guarantees for loans availed by the Company, UML and Nugenic Pharma Private Limited (its group company), and in the event these guarantees are enforced against its Promoters, it could adversely affect the company Promoters` ability to manage the affairs of the Company.

After the completion of the Offer, its Promoters will continue to collectively hold substantial shareholding in the Company.

Information relating to the installed manufacturing capacity of its two manufacturing facilities included in this Red Herring Prospectus are based on various assumptions and estimates.

The company commissioned and purchased the CRISIL Report. This Red Herring Prospectus contains information from the CRISIL Report and such information is subject to inherent risks and limitations.

The company will not receive any proceeds from the Offer for Sale. The Selling Shareholders will receive the net proceeds from the Offer for Sale.

After the completion of the Offer, its Promoters will continue to collectively hold substantial shareholding in the Company.

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

Information relating to the installed manufacturing capacity of its two manufacturing facilities included in this Draft Red Herring Prospectus are based on various assumptions and estimates and future production and capacity may vary.

The company funding requirements and proposed deployment of the Net Proceeds are based on management estimates and may be subject to change based on various factors, some of which are beyond its control.

Certain sections of this Draft Red Herring Prospectus contain information from the CRISIL Report which the company commissioned and purchased and any reliance on such information for making an investment decision in the Offer is subject to inherent risks.

The company will not receive any proceeds from the Offer for Sale. The Selling Shareholders will receive the net proceeds from the Offer for Sale.