Pyramid Technopl

Risks

• Substantial portion of its revenues come from the manufacturing of polymer based molded industrial packaging products like IBC and Polymer Drums.

• Any change in government policies or quality norms by its customers for molded industrial packaging, which the company may not be able to adhere to, may affect its business growth, operations and financials.

• The company customers expect it to maintain high quality standards and any failure by the company to comply with such quality standards may have an adverse effect on demand from end customers and on its reputation, business, results of operations and financial condition.

• The company may lose clients and their business if its products are not able to meet durability and other industry standards.

• The Company has not entered into any long-term agreements with its customers for purchasing the company products. Its subject to uncertainties in demand and there is no assurance that the company customers will continue to purchase its products. This could impact the business and financial performance of the Company.

• Polymer including polypropylene and polyethylene is the company primary raw material consumed by it for polymer based molded products including IBC & Polymer Drums and constitutes a significant percentage of the Company`s total expenses. Polymer is a derivative of crude oil and any substantial increase in price of crude oil or decrease in the supply of polymer could materially adversely affect the Company`s business. Further, while importing polymer, its may subject to risks arising from foreign exchange rate movements. If the company is unable to rightly anticipate foreign exchange movements and hedge its forex risks, the company financial condition may get adversely affected due to forex losses.

• Mild steel (MS) is the primary raw material required to manufacture MS Drums. MS is manufactured by using iron ore and sponge iron and substantial increase in price of iron ore and sponge iron or decrease in the supply of iron ore and sponge iron could materially adversely affect the manufacturer of MS Drums.

• If the company has unable to successfully implement its proposed expansion plans, the company results of operations and financial condition could be adversely affected.

• The company has substantial working capital requirements. Its inability to obtain and / or maintain sufficient cash flow, credit facilities and other sources of funding in a timely manner to meet the company requirements of working capital or payment of its debts, could adversely affect the company operations.

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

• The company customers` requirements to locate its manufacturing plants in close proximity to their facilities may require capital expenditure and the company may not be able to manage its manufacturing plants at various locations effectively.

• The company manufacturing units are situated in Bharuch, Gujarat and Silvassa, UT of Dadra & Nagar Haveli and its operations may be affected by various factors associated with the region where the company operate.

• The company inability to protect or use intellectual property rights may adversely affect its business.

• The company has certain contingent liabilities that have not been provided for in its Restated Financial Statements, which if realised, could adversely affect the company financial condition.

• The company have experienced negative cash flows in the past and may continue to do so in the future and the same may adversely affect its cash flow requirements, which in turn may adversely affect the company ability to operate its business and implement the company growth plans, thereby affecting its financial condition.

• There are outstanding legal proceedings involving the Company which may adversely affect its business, financial condition and results of operations.

• Developments in the competitive environment in the plastic and plastic products industry, such as consolidation among the competitors, could have a material adverse effect on the company competitive position and hence its business, financial condition, results of operations or prospects.

• The Company has not entered into long-term agreements for the supply of raw materials with our suppliers. Its subject to uncertainties in the supply of raw materials and there is no assurance that the company suppliers will continue to sell raw materials to us as per its requirements. This could impact the business and financial performance of the Company.

• The company success largely depends upon the services of its senior management and other Key Managerial Personnel (KMP) and the company ability to attract and retain them. Demand for senior management personnel in the industry is intense and its inability to attract and retain the company KMP may affect the operations of the Company.

• The company do not own the land on which its manufacturing units at Bharuch have been set-up. Any revocation or adverse changes in the terms of the lease may have an adverse effect on the company business, prospects, results of operations and financial condition.

• The company failure to accurately forecast and manage inventory could result in an unexpected shortfall and/ or surplus of products, which could harm its business.

• The company inability to respond adequately to increased competition may adversely affect its business, financial condition and results of operations.

• Any ban on polymer based packaging by the Government of India may affect the company business.

• In the event of any accident at the company manufacturing units, the Company may be held liable for damages and penalties which may impact the financials of the Company.

• The company is operating in a labour intensive industry, hence its may face labour disruptions and other planned and unplanned outages that could interfere or temporarily disrupt the company operations.

• The company business is dependent on its manufacturing units which are strategically located in Gujarat and UT of Dadra & Nagar Haveli. Any shutdown of operations of the compay manufacturing units may have an adverse effect on its business and results of operations.

• Any reduction in the demand for the company products could lead to underutilization of its manufacturing capacity. The company 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 condition and cash flows.

• The Company provides transportation of the raw material and delivery of products by utilising its own fleet of commercial vehicles. Any disruption in their operations or a decrease in the quality of their services could affect the Company`s reputation and results of operations.

• In the event the company fail to obtain, maintain or renew its 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 business and profitability will suffer if its fail to anticipate rapid changes in customer preferences and the industry on which the company focus.

• The outbreak of Novel Coronavirus, or outbreak of any other severe communicable disease could have a potential impact on the company business, financial condition and results of operations.

• The company has exposed to the risks of significant breaches of data security, and malfunctions or disruptions of information technology systems.

• Industry information included in this Draft Red Herring Prospectus has been derived from the Marketysers Report.

• The Company has in the past entered into related party transactions and may continue to do so in the future. There can be no assurance that such transactions, individually or in the aggregate, will not have an adverse effect on the company financial condition and results of operations.

• The company agreements with banks and financial institutions for financial arrangements contain restrictive covenants for certain activities and if its unable to get their approval, it might restrict the company scope of activities and impede its growth plans.

• The company Promoters have provided personal and corporate guarantees for its loans and any failure or default by it to repay such loans in accordance with the terms and conditions of the financing documents could trigger repayment obligations, which may adversely affect its Promoters` ability to manage the company affairs.

• Unsecured loans of Rs. 1,351.31 lakhs taken by the Company from lenders can be recalled at any time.

• The company cannot assure you that it will be able to secure adequate financing in the future on acceptable terms, in time, or at all. The company failure to obtain sufficient financing could result in delay or abandonment of its business plans and this may have an adverse effect on the company growth and operations.

• Certain corporate records and statutory records of the Company are not traceable.

• Any non-compliance in ROC fillings may expose it to fines and/or penalties from the statutory and regulatory authorities.

• The company Promoters and Promoter Group will continue to retain significant control in the Company after the Offer, which will allow them to influence the outcome of matters submitted to shareholders for approval. Such a concentration of ownership may also have the effect of delaying, preventing or deterring a change in control.

• The company ability to pay dividends in the future will depend upon future earnings, financial condition, cash flows, working capital requirements and capital expenditures and are also prohibited by the terms of its financing arrangements.

• The company insurance cover may not adequately protect it against all material hazards and accidents.

• The Objects of the Offer for which funds are being raised have not been appraised by any bank or financial institution. The deployment of funds is entirely at the discretion of its management and as per the details mentioned in the section titled "Objects of the Offer". Any revision in the estimates may require it to reschedule the company expenditure and may have a bearing on its expected revenues and earnings.

• The company may not be able to avail funding from banks or financial institution for its future working capital requirements. The failure to obtain such financing may adversely affect its ability to grow and the company future profitability.

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

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