Virtual Galaxy

One stop solution provider.

Diversified business across several verticals.

Diversified revenue streams.

Recurring and non-recurring, repeat revenues from long standing customer relationships.

Experienced promoters and senior management team with strong industry expertise and successful track record.

Growing our business through intellectual property capabilities.

Quality assurance and quality certification.

Substantial portion of its revenues has been dependent upon the company Core Banking software i.e. E-Banker. The loss of any one or more of its major clients would have a material effect on the company business operations and profitability.

The company depends on orders from the banks, government and private sector clients for majority of its revenue, which may expose it to risk. Additionally, the loss of or inability to qualify for such orders may adversely affect its business, financial condition, results of operations and prospects.

The company derives a significant portion of its revenue from customers located in Maharashtra. Any adverse developments in the region could adversely affect its business, results of operations, cash flows and financial condition.

The company revenues are dependent on clients concentrated in the BFSI segment. An economic slowdown or factors affecting this segment may have an adverse effect on its business, financial condition and results of operations.

Most projects the company operates have been awarded primarily through a competitive bidding process and its financial performance is largely dependent on the company successful bidding for new projects. Its may not always be able to qualify for, compete and win projects. If the company is not able to successfully bid for newprojects, it may adversely affect its business operations and financial conditions.

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

Significant disruptions in its information technology systems or breaches of data security could affect its business and reputation.

The company is dependent on its ability to customize software products as per the demands and requirements of the customer based on latest technology. If the company is not able to enhance current portfolio in response to evolving industry requirements, its operating results may be negatively affected.

The company has not yet placed orders for the GPU, server & storage system at Data Centre, which its propose to finance from the Net Proceeds. In the event of any delay in placing such orders, or in the event the vendors are not able to provide the equipment`s in a timely manner, or at all, it may result in time and cost overruns and its business, prospects and results of operations may be adversely affected.

Its may faces several risks associated with the proposed expansion of the company development facility at Mihan SEZ, Nagpur, which could hamper its growth, prospects, cash flows and business and financial condition.

One of its objects of the Issue is to augment its business development, sales & marketing and other related expenses for the company. The expenditure proposed to be incurred is subject to external factors and uncertainty of the outcome of such expenditure.

Its may not earn a positive return from the company investments in research and development activities.

The Company was incorporated in the year 1997 and certain documents filed by it with the RoC are not traceable. While the company has conducted a search with RoC, in respect of the availability of certain forms and other records, its cannot assure you that these forms or records will be available at all or any time in the future.

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

There had been sudden change in the profit after tax of the Company during the Fiscal 2024 and stub period. Any further sudden changes in profit after tax of the Company or significant variation in the ratios may have material adverse effect on its business, results of operations, financial condition, cash flows and future prospects.

Software Product development is a long, expensive and uncertain process and its current expenditure in product development may not provide a sufficient or timely return.

The company use third-party software and hardware that may cause errors or defects in, or failures of, the services or solutions the company provide.

The company does not own the premises in which its registered office and data centre is located and the same are on lease arrangement. Any termination of such lease/license and/or non-renewal thereof and attachment by Property Owner could adversely affect its operations.

The company relies on its data centres for efficient functioning of the company technology platform, and any interruption or delay in service from these facilities could impair the delivery of its technology platform and adversely impact the company business and results of operations.

The Company`s Logo "Virtualgalaxy" (filed in Class 9, 42, 36 & 39) are currently not registered with Registrar of Trademark; any infringement of its brand name or failures to get it registered may adversely affect its Business. Further, any kind of negative publicity or misuse of the company brand name could hamper its goodwill and the company future growth strategies could be adversely affected.

Its software products owing to certain issues such as coding, configuration or any other technical error or defects could lead to Company bearing exponential costs, delay in revenues and consequently expose it to litigation.

Its may become liable to the company customers and lose customers if the company has defects or disruptions in its software products. Its may also be liable in the event of misuse of the company software products or platforms.

If the company fails to attract and retain highly skilled IT professionals, its may not have the necessary resources to properly staff projects and failures to successfully compete for such IT professionals could adversely affect its business, financial condition and results of operations.

The nature of its software product exposes the company to a range of risks, including conflicting legal and regulatory requirements. Non-compliance of which may negatively impact its business and operational outcomes.

There are certain discrepancies and non- compliances noticed in some of its financial reporting and/or records relating to filing of returns and deposit of statutory dues with the taxation and other statutory authorities.

The company has relied on certain suppliers for its operations. Further more, the company has not entered into any long-term agreement or contract with the suppliers. The potential loss of any one or more of its major suppliers would have a material effect on the company business operations and profitability.

Its may expose to competition from onshore and offshore CBS & ERP providers, the company inability to compete successfully against competitors, pricing pressures or loss of market share could materially adversely affect its business, financial condition and results of operations.

Its success largely depends upon the knowledge and experience of the company Promoters, Directors, its Key Managerial Personnel and Senior Management as well as the company ability to attract and retain personnel with technical expertise. Any loss of its Promoter, Directors, Key Managerial Personnel, Senior Management or the company ability to attract and retain them and other personnel with technical expertise could adversely affect its business, financial condition and results of operations.

Failures to offer client support in a timely and effective manner may adversely affect its relationships with the company clients.

Any IT system failures or lapses on part of any of its employees may lead to operational interruption, liabilities or reputational harm.

Any failures to accurately estimate the overall risks, revenues or costs in respect of a project, may adversely affect its profitability and results of operations. Its actual cost in executing a contract may vary substantially from the assumptions underlying its contract. The company may be unable to recover all or some of the additional expenses, which may have a material adverse effect on its results of operations, cash flows and financial condition.

Fluctuations in foreign currency exchange rates could materially affect its financial results.

If the company is unable to establish and maintain an effective internal controls and compliance system, its business and reputation could be adversely affected.

The company has incurred indebtedness and an inability to comply with repayment and other covenants in its financing agreements could adversely affect the company business and financial condition.

Certain unsecured loans availed by the Company is repayable on demand. Any demand for repayment of such unsecured loans, may adversely affect its cash flows.

The company relies on financing from banks or financial institutions to carry on its business operations, and inability to obtain additional financing on terms favourable to it or at all could have an adverse impact on the company financial condition. Further, certain of its financing agreements involve variable interest rates and an increase in interest rates may adversely affect the company results of operations and financial condition. If the company is unable to raise additional capital, its business and future financial performance could be adversely affected.

Its Promoter, members of Promoter Group and director have mortgaged their properties and provided personal guarantees to certain loan facilities availed by it, which if revoked may requires alternative guarantees, repayment of amounts due or termination of the facilities.

Its Promoters and promoter group members are interested in the Company`s performance in addition to their remuneration and reimbursement of expenses.

The company has issued Equity Shares during the last one year at a price that may be below the Issue Price.

The company relies on channel partners and third- party service providers for some part of its services and any failures on their part to perform their obligations could adversely affect its reputation, business, results of operations and cash flows.

Its insurance coverage may not be adequate to protect the company against certain operating hazards and this may have a material adverse effect on its business.

The Company had negative cash flows in the past years from investing activities, details of which are given below. Sustained negative cash flow could impact its growth and business.

Its business requires working capital. Any failure in arranging adequate working capital for the company operations may adversely affect its business, results of operations, cash flows and financial condition.

The Company has entered into related party transactions in the past and may continue to enter into related party transactions in the future, which may potentially involve conflicts of interest with the equity shareholders.

Interruptions or performance problems associated with its technology and infrastructure may harm the company business and results of operations.

In case of its 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.

There may be potential conflict of interests between the Company and other venture or enterprises promoted by its promoters or directors.

As of December 31, 2024, the company had contingent liabilities which have not been provided for in its financial statements and could adversely affect the company financial condition.

Its growth strategy to expand the company geographical footprints exposes it to certain risks, and if the company is unable to manage these risks it may have a material adverse effect on its operations.

The loss of certain independent certification and accreditation of its products and services that the company has adopted could harm its business.

The company has not identified any alternate source of funding and hence any failures or delay on its part to mobilize the required resources or any shortfall in the Issue proceeds may delay the implementation schedule.

A portion of 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.

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

Employee misconduct including misuse of confidential data and failures to maintain confidentiality of information could harm its and is difficult to detect and deter.

Industry information included in this Red Herring Prospectus has been derived from industry reports available on public domain. There can be no assurance that such third-party statistical, financial and other industry information is either complete or accurate.

Its ability to pay dividends will depends upon future earnings, financial condition, cash flows, working capital requirements, capital expenditures and other factors.

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 issue of capital or securities and/or loans taken by the company, may be prejudicial to the interest of the shareholders depending upon the terms on which they are eventually raised.

The average cost of acquisition of Equity Shares by the Promoters may be less than the Issue Price.

None of the Promoters of the Company has experience of being a promoter of a public listed company.