Shivalic Power Control Ltd IPO

The object of making unidentified acquisitions may lead to significant investments in the businesses that may not be sustainable in the long run, which may result in financial losses and negatively impact the company's overall portfolio.

The company has not yet placed orders in relation to the capital expenditure to be incurred for the proposed purchase of equipment / machineries. In the event of any delay in placing the orders, or in the event the vendors are not able to provide the equipment / machineries in a timely manner, or at all, the same may result in time and cost over-runs.

The Company has given Guarantees of Rs. 694.87 Lakh in favour of its clients through Bank Guarantees. The company cannot assure that there will be no default in the future.

Its lenders have charged over the company movable, immovable properties and book debts in respect of finance availed by it.

Inventories and trade receivables form a major part of its current assets. Failure to manage the company inventory and trade receivables could have an adverse effect on its sales, profitability, cash flow and liquidity.

Its top ten clients contribute approximately 40.77%, 53.02%, 56.78% and 82.97% of the company revenues from operations for the period ended December 31, 2023 and for the year ended March 31, 2023, March 31, 2022 and March 31, 2021 respectively. Any loss of business from one or more of them may adversely affect its revenues and profitability.

The Company had negative cash flows in the past years, details of which are given below. Sustained negative cash flow could impact its growth and business.

The Company has availed secured short-term working capital loan of Rs. 2,529.88 lakhs and unsecured loan of Rs. 422.18 lakhs which are repayable on demand. Any demand from the lenders for repayment of such loan may affect its cash flow and financial condition.

The Company is involved in certain legal proceeding(s) potential litigations. Any adverse decision in such proceeding(s) may render it/them liable to liabilities/penalties and may adversely affect its business and results of operations.

Risk of Forward integration by the OEMs to direct manufacture the electric control panels or cancellation of its tie-up with the OEMs.