Polysil Irrigati

Risks

• Failure to successfully procure raw materials in a timely manner, at competitive rates, or at all, or to identify new raw material suppliers could adversely affect the company business, financial condition and results of operations.

• The Company, Promoter and Directors are involved in certain litigation which is currently pending at various stages. Any adverse decisions in these cases against the Company, Promoter and Director. may impact business and operations of the Company.

• In case of the company 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 business.

• The company has experienced negative cash flows in previous years. Any operating losses or negative cash flows in the future could adversely affect its results of operations and financial conditions.

• The Micro Irrigation Industry is highly dependent on subsidy policy by the central & state government.

• The company relies significantly on the Dealers/ Distributors network for sale of its products through open market sale.

• Any disruptions in transportation systems, including those arising from the company reliance on third parties for its transportation needs, may adversely affect the company business and results of operations.

• Any failure to adapt to industry trends and evolving technologies to meet the company customers` demands may adversely affect its business and results of operations.

• The company is subject to risks associated with expansion into new geographic markets. Any inability to expand into new geographic markets or penetrate existing markets may adversely affect its growth and future prospects.

• The company Statutory Auditor have included certain emphasis of matters in their auditors` report in its audited financial statements and Restated Financial Statement for Fiscal 2023.

• Potential impact on manufacturing operations from absence of Independent Contractors.

• The company requires certain certifications in the name of Polysil Irrigation Sytem Limited, pursuant conversion from Private Company to Public Company by the Registrar of Companies, Ahmedabad, Gujarat. There can be no assurance that the relevant authorities will issue any of such permits or approvals in the time-frame anticipated by it.

• Demand for the company product is seasonal and largely depends on the farm produce and subsidy cycle. Its inability to estimate demand and consequently maintain an optimal level of inventory in the company depots and manufacturing facilities may impact its operations adversely.

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

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

• There has been some instances of delay/ default in payment of statutory dues by the Company in the past.

• The company is yet to obtain consents/ no objection certificate from lender of the Company for the Issue.

• The company may be subject to financial and reputational risks due to product quality and liability claims and legal proceedings if the quality of its products does not meet the company customers` expectations.

• The objects of the Offer include funding working capital requirements of the Company, which are based on certain assumptions and estimates.

• Any variation in the utilization of the Net Proceeds as disclosed in this Draft Prospectus shall be subject to certain compliance requirements, including prior shareholders` approval.

• The Company has incurred substantial indebtedness which exposes it to various risks which may have an adverse effect on its business and results of operations. The company financing agreements impose certain restrictions on its operations, and the company failure to comply with operational and financial covenants may adversely affect its reputation, business and financial condition.

• The Company has unsecured loans that may be recalled by the lenders at any time.

• The company has issued Equity Shares in last twelve (12) months at a price lower than the Offer Price (other than bonus).

• The company has not identified any alternate source of raising the funds mentioned as its `Objects of the Issue`. Any shortfall or delay in raising / meeting the same could adversely affect the company growth plans, operations and financial performance.

• The company insurance coverage may not adequately protect it, which may adversely affect its business, results of operations and financial condition.

• If the company is subject to any frauds, theft, or embezzlement by its employees, suppliers, contractors, it could adversely affect the company reputation, results of operations, financial condition and cash flows.

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

• The company does not own its registered office and godown/storage from which the company carry out its business activities.

• The company future funds requirements, in the form of issue 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.

• The company does not hold any patents or other form of intellectual property protection in relation to its manufacturing processes, and the company inability to maintain the integrity and secrecy of its manufacturing processes may adversely affect the company business.

• The company Manufacturing Unit is located at Vadodara in Gujarat exposing us to regulatory and other geography specific risks such as weather and natural occurrences as well as regulatory, economic, demographic and other changes in Gujarat.

• The company`s business operations may be disrupted by an interruption in power supply, which may impact its business operations.

• Delays or defaults in client payments could affect the company operations.

• The company Promoters / Directors / Key Management Persons have given personal guarantees and have secured their personal properties in relation to debt facilities provided to it.

• The company is susceptible to exchange rate fluctuations.

• The Company will not receive any proceeds from the Offer for Sale.

• The company cannot assure you that we will be able to secure adequate financing in future on acceptable terms, in time, or at all.

• The company relies on third-party manufacturers for sale of some of its products. Any shortage and cessation in supply from these contract manufacturers could adversely affect its business, results of operations and cash flows.

• If the company pursue acquisitions, joint ventures and investments, its may not be able to successfully consummate favorable transactions or successfully integrate or leverage from such businesses.

• The company administrative office, from where its operate, are taken on leave and license. Discontinuation of lease agreements may require it to vacate such premises which may have an adverse impact on the company business continuity and profitability.

• The company is unable to trace certain corporate records pertaining to the build-up of Equity Shares held by certain of its Promoters.

• Any adverse changes in regulations governing the company business operations or products or the products of the end-customers, may adversely impact its business, prospects, results of operations and cash flows.

• The company Promoter and the Promoter Group will jointly continue to retain majority shareholding in the Company after the issue, which will allow them to determine the outcome of the matters requiring the approval of shareholders.

• The Company has the right to use the brand name "Polysil" which is registered in the name of the erstwhile promoter group.

• The company generally do business with its customers on purchase order basis and do not enter into long term contracts with most of them.

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

• The company funding requirements and the proposed deployment of Net Proceeds have not been appraised by any bank or financial institution or any other independent agency and its management will have broad discretion over the use of the Net Proceeds.

• The compay`s success depends largely upon the services of the Directors, Promoters and other Key Managerial Personnel and Senior Management Personnel and its ability to attract and retain them. Demand for Key Managerial Personnel in the industry is intense and the company inability to attract and retain Key Managerial Personnel may affect the operations of the Company.

• The company has not commissioned an industry report for the disclosures made in the chapter titled ndustry Overview` and made disclosures on the basis of the data available on the internet and such data has not been independently verified by it.

• Certain data mentioned in this Draft Prospectus has not been independently verified.

• The company Promoters, Directors and Key Management Personnel or Senior Management Personnel may have interests in it other than reimbursement of expenses incurred and normal remuneration or benefits.

• Any variation in the utilisation of the Net Proceeds would be subject to certain compliance requirements, including prior shareholders` approval.

• The company revenues and profits are dependent on several factors. Any adverse change in these factors or in combination of these factors may affect its business operations and the financial condition and consequently, the company ability to pay dividends.

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

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

• If certain labour laws become applicable to it, the company profitability may be adversely affected.

• The company future fund requirements, in the form of further issue 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.