Petro Carbon

Risks

• The Promoter Selling Shareholders, will receive the entire proceeds from the Offer for Sale. The Company will not receive or benefit from any proceeds from the Offer for Sale.

• The company depends on the success of its relationships with its customers. The company revenue is generated from certain of its key customers, and the loss of one or more such customers, the deterioration of their financial condition or prospects, or a reduction in their demand for its products could adversely affect the company`s business, results of operations, financial condition and cash flows.

• The Company derives a substantial portion of its revenues from sales of aluminium and steel industry and has a single product CPC.

• In the event the company is unable to procure adequate amount of raw material, at competitive prices, its business, results of operations and financial condition may be adversely affected. Further, the company generally does not enter into agreements with its suppliers and accordingly may face disruptions in supply from the current suppliers.

• The company is subject to strict technical specifications and quality requirements provided by its customers and failure to comply with the technical specifications and quality standards prescribed by such customers may lead to loss of business from such customers and could negatively impact its reputation, which would have an adverse impact on the company`s business prospects and results of operation.

• Any reduction in the demand of its products could lead to underutilisation of the company`s manufacturing capacity. Its may also face surplus production of a particular product due to various reasons including inaccurate forecasting of customer requirements, which could adversely affect its business, results of operations, financial conditions and cash flows.

• Prices and sales volumes for its CPC are dependent on the aluminium industry, and any decrease in such demand or prices could adversely affect the company revenues and results of operations.

• The restated financial statements have been provided by peer reviewed chartered accountants who is not statutory auditor of the Company.

• The company depends on certain key suppliers for its raw materials and other components required for the company`s manufacturing process which could result in delays and adversely affect its output.

• The company depends on key equipment and machinery, and the non-availability of such equipment at reasonable cost may adversely affect its operations and financial results.

• Its business is dependent on the company`s Manufacturing Plants and its subject to certain risks in the company`s manufacturing process. Any slowdown or shutdown in its manufacturing operations or underutilization of the company`s Manufacturing Plants could have an adverse effect on its business, results of operations and financial condition.

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

• The company requires certain approvals, licenses, registration and permits for its business, and the failure to obtain or renew them in a timely manner may adversely affect the company operations.

• The company may be unable to sufficiently obtain, maintain, protect, or enforce its intellectual property and other proprietary rights.

• The Company, its Directors and its Promoters are party to certain litigation and claims. These legal proceedings are pending at different levels of adjudication before various forums and regulatory authorities. Any adverse decision may make it liable to liabilities/penalties and may adversely affect its reputation, business and financial status.

• Its inability to effectively manage the company growth or to successfully implement its business plan and growth strategy could have an adverse effect on its business, results of operations and financial conditions.

• The company requires certain statutory and regulatory approvals for conducting its business and the company`s inability to obtain, retain or renew them in a timely manner, or at all, may adversely affect its operations.

• Failure to comply with environmental laws and regulations could lead to unforeseen environmental litigation which could impact its business and the company future net earnings.

• A violation of health and safety requirements and the occurrence of accidents could disrupt the Company`s operations and increase operating costs.

• Any change in Government policies towards the CPC industry could adversely affect its business and results of operations.

• The company is dependent on third party transportation providers for the supply of raw materials and delivery of its products.

• The company is exposed to foreign currency exchange rate fluctuations, which may impact its results of operations and cause the company`s financials performances to fluctuate.

• 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.

• The company has significant power requirements for continuous running of its manufacturing units. Any disruption to the company`s operations on account of interruption in power supply or any irregular or significant hike in power tariffs may have an effect on its business, results of operations and financial condition.

• Its operating results could be adversely affected by weakening of economic conditions due to lock-down in all parts of India and other parts of world & other situation due to pandemic Covid-19.

• 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.

• The company is subject to performance risk from third-party contractors, and operational risks associated with the engagement of third-party contractors and its employees.

• 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 Promoters and Directors hold Equity Shares in the Company and are therefore interested in the Company`s performance in addition to their remuneration and reimbursement of expenses.

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

• The requirements of being a public listed company may strain its resources and impose additional requirements.

• Its ability to pay dividends in the future will depends on the company future cash flows, working capital requirements, capital expenditures and financial condition.

• Its insurance coverage may not be adequate to protect it against all potential losses to which the company may be subject and this may have a material effect on its business and financial condition.

• Non-compliance with amendment in Safety, Health and Environmental laws and other applicable regulations, may adversely affect the Company`s results of operations and its financial condition.

• The company has not independently verified certain data in this Draft Red Herring Prospectus.

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

• The company will continue to be controlled by its Promoter and Promoter Group after the completion of the Issue, which will allow them to influence the outcome of matters submitted for approval of its shareholders.

• The company is susceptible to risks relating to unionization of its employees employed by the company.

• Any future issuance of Equity Shares may dilute your shareholdings, and sale of the Equity Shares by its major shareholders may adversely affect the trading price of the company Equity Shares.

• Its inability to effectively implement the company business and growth strategy may have an adverse effect on its operation and growth.

• 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.

• There is no guarantee that the Equity Shares issued pursuant to the Issue will be listed on the Emerge Platform of National Stock Exchange of India Limited in a timely manner, or at all.

• The company has significant power requirements for continuous running of its manufacturing units. Any disruption to its operations on account of interruption in power supply or any irregular or significant hike in power tariffs may have an effect on its business, results of operations and financial condition.

• Its business is manpower intensive and any unavailability of the company employees or shortage of contract labour or any strikes lockout, work stoppages, increased wage demands by workmen or changes in regulations governing contractual labour may have an adverse impact on its cash flows and results of operations.