Vruddhi Engineer

Risks

• The Company, Promoters, Directors and Group Companies are parties to certain legal proceedings. Any adverse decision in such proceedings may have a material adverse effect on its business, results of operations and financial condition.

• In case of its inability to obtain, renew or maintain the statutory and regulatory licenses, permits and approvals required to operate the company business it may have a material adverse effect on its business.

• The company has made an application with the Registrar of Trade Marks for registration of the logos and same has been under the status of send to Vienna Codification. Any delay in receiving the approval and/or granting registration or in obtaining registration could result in loss of logos & brand equity and the Company right to use the said logos.

• The Company and its Promoter may not have significant experience in the business of the Company.

• The company is highly dependent on its suppliers for uninterrupted procurement and sale of the company traded goods. Any disruption of supply from such entities may affect its business operations.

• The company has availed unsecured loans which are repayable on demand. Any demand for repayment of such unsecured loans, may adversely affect its cash flows.

• The company don`t own registered office, corporate office and the godown which is used by it currently.

• The company operations are significantly located in and around Mumbai and failure to expand its operations may restrict the company growth and adversely affect its growth.

• Changes in technology may affect its business by making the company equipment or products less competitive or obsolete.

• The company insurance policies do not cover all risks, specifically risks like loss of profits, terrorism, etc. In the event of the occurrence of such events, its insurance coverage may not adequately protect it against possible risk of loss.

• The company is subject to strict quality requirements and are consequently required to incur significant expenses to maintain the company product quality. Any failure to comply with such quality standards may lead to cancellation of existing and future orders which may adversely affect its reputation, financial conditions, cash flows and results of operations.

• The company trading activities is exposed to fluctuations in the prices of traded products. Increase in costs of its traded product could have a material adverse effect on the Company`s sales, profitability and results of operations.

• The Company has incurred losses in the previous Fiscals.

• All of its product verticals are extremely competitive segments and the company face risk of competition affecting its margins and profitability as the company scale its operations.

• 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 not complied with certain statutory provisions of the Companies Act, 2013 and other acts. Such noncompliance may attract penalties against the Company which could impact the financial position of it to that extent.

• The Company`s Director had not filed Income Tax Return for any Financial Year.

• The company propose to utilize a portion of the Net Proceeds for funding working capital requirements of the Company.

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

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

• Substantial portion of its revenues has been dependent upon the company few customers. The loss of any one or more of its major clients would have a material adverse effect on its business operations and profitability.

• The Company has reported certain negative cash flows from its operating activity, investing activity and financing activity, details of which are given below.

• 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.

• Delays or defaults in client payments could affect its operations.

• Failure to manage its inventory could have an adverse effect on the company net sales, profitability, cash flow and liquidity.

• Any adverse changes in regulations governing its business operations or products or the products of its end-customers, may adversely impact the company 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 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. In addition, certain of its financing agreements involve variable interest rates and an increase in interest rates may adversely affect its results of operations, cash flows and financial condition.

• The company ability to pay dividends in the future will depend upon its future earnings, financial condition, cash flows, working capital requirements, capital expenditure and restrictive covenants in its 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 company success depends largely upon the services of its Directors, Promoter and other Key Managerial Personnel and the company ability to attract and retain them. Demand for Key Managerial Personnel in the industry is intense and its 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 publicly available data and such data has not been independently verified by it.

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

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

• 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 its growth plans, operations and financial performance.

• Any Penalty or demand raised by statutory authorities in future will affect the company financial position of the Company.

• The company has 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 its management and the company board of Directors, though it shall be monitored by its Audit Committee.

• 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.

• The steel industry is highly cyclical and an increase in steel prices may have an adverse effect on the Company`s results of operations.