1. Its business is vulnerable to variations in demand of denim-based apparels and changes in consumer preferences, which could have an adverse effect on its business, results of operations and financial condition.
2. Substantial portion of its revenues has been dependent upon few customers, with which the company does not have any firm commitments. The loss of any one or more of its major customer would have a material adverse effect on its business, cash flows, results of operations and financial condition.
3. The company face competition, including from other large and established competitors, and its may fail to compete successfully against existing or new competitors, which may reduce the demand for the company Products which may lead to reduced prices, operating margins, profits and further result in decline in revenue.
4. The company is primarily dependent upon few key suppliers for procurement of raw materials. Any disruption in the supply of these raw materials or fluctuations in their prices could have a material adverse effect on its business operations and
financial conditions.
5. The company relies on outsourcing a certain proportion of its production processes and activities to third-parties, without exclusivity arrangements. Any inability to obtain sufficient quantities of processed material of the requisite quality in a timely manner and at acceptable prices, or a slowdown, shutdown or disruption in such third parties' operations and performance, could adversely affect its business, results of operations and financial condition.
6. The company requires certain approvals, licenses, registrations and permits to operate its business, and failure to obtain or renew them in a timely manner or maintain the statutory and regulatory permits and approvals required to operates its business may adversely affect the company operations and financial conditions.
7. The Company, Promoters and Directors are parties to certain tax proceedings. Any adverse decision in such proceedings may have a material adverse effect on its business, results of operations and financial condition.
8. One of its Promoter Group entity, namely CIL Nova Petrochemicals Limited, has in the past been restrained by SEBI from buying, selling, dealing or accessing the securities market for violation of the SEBI (Prohibition of Fraudulent and
Unfair Trade Practices relating to Securities Market) Regulations, 2003. In addition, one of its Promoter Group member, Mr. Shivkumar Omprakash Agarwal and Promoter group entity, Shivalay Texo Fab. Pvt. Ltd. has been declared as defaulters by MCA for not filing Annual Returns and Balance Sheet.
9. The company has not complied with certain statutory provisions of the Companies Act, 2013. Such non-compliance may attract penalties against our Company which could impact the financial position of it to that extent.
10. The Company's logo is not registered as on date of this Draft Red Herring Prospectus. Its may be unable to adequately protect the company intellectual property. Furthermore, its may be subject to claims alleging breach of third party intellectual property rights which could have a material adverse effect on its business, results of operations and financial condition.