1. The company face significant competition in the Indian jewellery market, its risk losing substantial portion of the company customers and its market share which will adversely affect its business, financial condition, results of operations and prospects.
2. The Company requires significant amounts of working capital for continued growth. Its inability to meet the company working capital requirements, on commercially acceptable terms, may have an adverse impact on its business, financial condition and results of operations.
3. The company obtain gold on loan basis, which remains subject to RBI regulations. Any adverse change in the regulations governing gold on loan basis may adversely affect its financial condition and results of operations.
4. A significant portion of the company manufacturing work is done by Karigars who do not work exclusively for it which exposes it to any risks/adverse developments affecting the Karigars.
5. The company has been subject to a 'Search and Seizure' operation by the income-tax department in the past, which has resulted in taxation and criminal proceedings being initiated against the Company and its Individual Promoter. The company has also been subject to an on spot search from the Directorate General of Central Excise Intelligence, Kolkata along with show cause notice. Further, a search has been conducted by the customs department at its Registered and Corporate Office in relation to an investigation against one of its Job Worker and vendor and a spot summons was issued to the Company. Any adverse outcome of such proceedings might have an adverse effect on its business, financial condition and results of operations.
6. The company relies in part on its franchisees, and if its franchisees cannot develop or finance new showrooms or build them on suitable sites, open them on schedule or manage them successfully, or if the company is are unable to renew its existing franchisees or secure new franchisees on commercially acceptable terms, its growth and success may be affected.
7. The company may not be successful in implementing its brand building, marketing and advertising initiatives for the company brands. Any fall in its brand's reputation and market perception "Senco Gold and Diamonds", may adversely affect the company business, results of operations and prospects.
8. The company income and sales are subject to seasonal fluctuations and lower income in a peak season may have a disproportionate effect on its results of operations.
9. Differing regulatory views on various jewellery purchase schemes initiated by the company may have adverse implications on the Company and/or its Directors under applicable laws; and in particular, the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014, as amended.
10. The non-availability or high cost of quality gold and diamonds may have an adverse effect on its business, results of operations, financial condition and prospects.