Goyal Salt Ltd IPO

The company's Refining unit is located in Rajasthan and exposed to various regulatory and other geographical risks such as weather and natural occurrence as well as regulatory, economic, demographic and other changes in the state of Rajasthan or in India. In particular, excessive and non-seasonal rainfalls could deteriorate the quality and supply of the company principal raw material namely raw salt. This will adversely affect its business and financial conditions.

Its refining of salt process has 25.86%, 24.30% and 20.48% process loss during the year ending on March 31, 2023, 2022 and 2021. Any further increase in process loss will have severe effects on its operational costs, profit margins, and financial performance.

The company derives 68.47%, 60.35% and 50.84% of its revenue from top 10 customers during the fiscal ending on March 31, 2023, 2022 and 2021. If one or more of such customers choose not to source their requirement from it, the company business, financial condition and result of operation may be adversely affected.

The company has in the past entered into transactions with related parties and may continue to do so in the future. These or any future related party transactions may potentially involve conflicts of interest and there can be no assurance that the company could not have achieved better terms, had such arrangements been entered into with unrelated parties.

Insufficient water availability at its refining unit causes the increase in the company expenditure to meet the water requirements and thus reduces its profitability.

The Company requires significant amounts of working capital for continued growth. Its inability to meet the company working capital requirements may have an adverse effect on its results of operations. Further, failure to manage the company inventory could have an adverse effect on its sales, profitability, cash flow and liquidity.

The company does not have long term agreements with suppliers for its raw materials and packaging material and an increase in the cost of, or shortfall in the availability or quality of such raw materials and packaging material could have an adverse effect on its business, financial condition and result of operation.

The Restated Financial Statements have been provided by Peer Reviewed Chartered Accountants who is not Statutory Auditor of the Company.

There are pending litigations against the company and certain Directors and any adverse decision in these proceedings may render it/them liable to liabilities/penalties and may adversely affect its business, result of operations and financial conditions.

Any negative publicity or defect in product quality may cause the Company substantial costs which in turn could adversely affect its goodwill and the sales could be diminished.