Recode Studios Ltd IPO

We outsource the manufacturing of all our products to third-party manufacturers and do not own any manufacturing facilities. Our reliance on such third-party manufacturers exposes us to several operational, regulatory and business risks that may adversely affect our operations, financial condition and results of operations.

Our business is dependent on the recognition, perception and acceptance of the "Recode" brand, and any damage to our brand reputation could adversely affect our business, results of operations and financial condition.

We operate in the beauty, cosmetics and personal care segment in India, which is subject to rapidly changing consumer preferences, and any failure to respond effectively to such changes could adversely affect our business, results of operations and financial condition.

Our reliance on online retail channels and third-party e-commerce platforms exposes us to risks relating to platform policies, pricing pressures, customer reviews and rapid amplification of adverse publicity, which could adversely affect our business, results of operations and financial condition.

Our limited control over franchise-operated stores may result in inconsistent service quality, regulatory non-compliance and adverse impact on our brand and business.

Our dependence on a limited number of third-party manufacturers, and adverse changes in commercial terms, regulatory compliance or operational continuity at such manufacturers, may adversely affect our business, financial condition and results of operations.

We do not have long-term agreements with our customers, and our revenues are significantly dependent on recurring orders from our B2B and online customers. Any loss or reduction of business from such customers could adversely affect our results of operations and financial condition.

Our business is significantly dependent on sales from the Face Make-Up category, and any decline in demand for products in this category could adversely affect our business, financial condition and cash flows.

Certain trademarks used by our Company, including trademarks under Class 3 that are central to our cosmetics and personal care business, are subject to objections, oppositions or pending ownership record updates, and any adverse outcome may restrict our ability to use such trademarks and adversely affect our business.

We operate in a highly competitive beauty and personal care industry, and increased competition may lead to a reduction in our revenues, reduced profit margins or a loss of market share.