Manoj Jewellers

Risks

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

• The company income and sales are subject to seasonal fluctuations and lower income in a peak season may have a disproportionate effect on its results of operations.

• Its may be unable to respond to changes in consumer demands and market trends in a timely manner.

• Its ability to attract customers is dependent on the success and visibility of the company showrooms.

• The non-availability or high cost of quality gold bullion and diamonds and fluctuations in their prices may have an adverse effect on its business, results of operations and financial condition.

• Jewellery purchases are discretionary and often perceived as luxury purchases. Any factor negatively impacting discretionary spending by consumers may adversely affect its business, results of operations, financial condition and prospects.

• The strength of its brands is crucial to the company growth and success and its may not succeed in continuing to maintain and develop the company brands.

• Volatility in the market price of gold and diamonds has a bearing on the value of its inventory and may affect the company income, profitability and scale of operations.

• The operations of the Company are located in the state of Tamil Nadu, any adverse developments affecting operations in this region could have a significant impact on its business, and results of operations.

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

• The coronavirus pandemic ("COVID-19") has had an effect on its business and operations, and the extent to which it may continue to do so in the future cannot be predicted.

• The Indian jewellery retail industry is extremely competitive.

• If the company lose the services of the members of its senior management or other key employees or if the company is not able to attract or retain qualified persons, its business and operations would be adversely affected.

• The company is dependent on third-party transportation providers for the delivery of its products, and any disruption in such delivery or failure by third parties to provide their services may adversely affect its operations.

• Any failures in its quality control processes may have an adverse effect on the company business, brand, results of operations and financial condition.

• The company has informal arrangements with various artisans who are engaged in making jewellery for it. procure The company does not enter into long term formal agreements with such artisans and may not be able to procure sufficient quantities or desired quality of products from such artisans in a timely manner or at acceptable prices, or on an exclusive basis, which may adversely affect its business, financial condition and results of operations.

• The company is dependent upon few suppliers for supply of its products. In an eventuality where the company suppliers are unable to deliver it the required materials in a time-bound manner it may have a material adverse effect on its business operations and profitability.

• Current locations of its stores may become unattractive, and suitable new locations may not be available for a reasonable price or acceptable terms, if at all.

• Its marketing and advertising campaigns may not be successful in increasing the popularity of the company products and offerings. If its marketing initiatives are not effective, this may adversely affect its business and results of operations.

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

• Its may be subject to fraud, theft, employee negligence or similar incidents.

• If the company is unable to maintain an optimal level of inventory, its business, results of operations and financial condition may be adversely affected.

• The company is required to maintain various licences and permits for its business.

• Its may be unable to renew the company leases for the properties occupied by it or secure leases for its existing or new properties on commercially acceptable terms.

• 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 has contingent liabilities, and its financial condition could be adversely affected if any of these contingent liabilities materializes.

• Its Promoters plays a key role in the company functioning and its heavily relies on their knowledge and experience in operating its business and therefore, it is critical for the company business that its promoters remain associated with the company.

• If the company is not able to obtain, renew or maintain the statutory and regulatory permits and approvals required to operate its business it may have an adverse effect on its business.

• Its lenders have charge over the company movable and immovable properties in respect of finance availed by it.

• 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 is unable to protect credit card or debit card data or any data related to any other electronic mode of payment, or any other personal information that its collect from customers, the company reputation could be significantly harmed.

• Any increase in interest rates would have an adverse effect on its results of operations and will expose the Company to interest rate risks.

• 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 business and results of operations.

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

• The company has taken guarantees from Promoters in relation to debt facilities provided to it.

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

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

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

• The company is subject to risks associated with expansion into new geographic regions.

• 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.

• The company does not own its Registered Office and its showroom from where the company operates.

• 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.

• Within the parameters as mentioned in the chapter titled "Objects of the Issue" beginning on page 74 of this Prospectus, the Company`s management will have flexibility in applying the proceeds of the Issue. The fund requirement and deployment mentioned in the Objects of this Issue have not been appraised by any bank or financial institution.

• 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.

• Its insurance coverage may not be adequate.

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

• Its future funds requirements, in the form of offer of capital or securities and/or loans taken by it, may be prejudicial to the interest of the shareholders depending upon the terms on which they are eventually raised.

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

• In addition to normal remuneration or benefits and reimbursement of expenses, some of its directors and key managerial personnel are interested in the Company to the extent of their shareholding and dividend entitlement in the Company.

• 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.

• Its Promoters have recently transferred their shares at a price which is less than the Issue Price.

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