1. The Company, some of its Subsidiaries, Promoters, Directors and Group Companies are parties to certain legal proceedings. Any adverse decision in such proceedings may have a material adverse effect on the company business, results of operations and financial condition.
2. The company requires certain approvals and licenses in the ordinary course of business and are required to comply with certain rules and regulations to operate its business, any failure to obtain, retain and renew such approvals and licences or comply with such rules and regulations may adversely affect the company operations.
3. Introduction of stricter norms regulating the company operation in domestic and overseas market could result in loss due to its inability to meet customer requirement and production schedules, which could materially affect the company business, results of operations and financial condition.
4. The company have certain contingent liabilities as stated in the Restated Consolidated Financial Statement, and in the event, they materialize it could adversely affect its financial condition.
5. The company has experienced negative cash flows from operating activities and may do so in the future, which could have a material adverse effect on its business, prospects, financial condition, cash flows and results of operations.
6. The Company is party to a legal proceeding concerning an alleged violation of environmental norms by the Company. An adverse outcome of the proceeding could have an impact on the Company's operations at Mukka Manufacturing Facility I.
7. In past, one of the company Promoter Director, Kalandan Mohammed Haris has been subject to search and seizure of property by Directorate of Enforcement in relation to alleged violation of Foreign Exchange Management Act, 1999 against which the company Promoter has filed a Writ Petition against (i) Union of India, (ii) Commissioner of Customs and (iii) Directorate of Enforcement before the Hon'ble High Court of Karnataka, at Bengaluru. An adverse outcome of the proceeding could have an impact on the Company's business, results of operations and financial condition.
8. A significant majority of the company revenues from operations are derived from a limited number of customers.
9. A majority of the company supplies for the company operations are obtained from a limited number of suppliers.
10. Under-utilisation of the company manufacturing capacities and an inability to effectively utilise its expanded manufacturing capacities could have an adverse effect on its business, future prospects and future financial performance.