1. The company may not be able to grow its portfolio of renewable energy power projects as the company relies on highly competitive renewable energy power project auctions. Further, its future growth is significantly dependent on successfully executing its Under Construction Awarded Projects and Under Construction Contracted Projects. In the event, the company is not successful in executing its future projects, its business and results of operations may be adversely impacted.
2. The company is dependent on its Power Purchase Agreements ("PPA") to sell power and generate its revenue from operations. Further, the terms of its PPAs may expose it to certain risks that may affect its future results of operations and cash flows.
3. Its business is dependent on the company's top 10 off-takers, which contributed 89.97%, 89.15% and 87.77% of its revenue from operations in Fiscal 2024, 2023 and 2022, respectively. The loss of any of these offtakers could have an adverse effect on its business, financial condition, results of operations and cash flows.
4. The company procured 79.37%, 69.84% and 69.95% of its total purchases in Fiscal 2024, 2023 and 2022, respectively from ACME Cleantech, its top supplier. Further, the company does not have definitive supply agreements with its vendors for the supply of components and any interruptions in supply could adversely affect its business, financial condition, results of operations and cash flows.
5. The Company, ACME Cleantech and ACME Solar Energy have received certain office orders from the
Directorate of Enforcement in connection with investigations under the Foreign Exchange Management Act, 1999, as amended. MKU Holdings has also received a questionnaire from the Directorate of Enforcement and subsequently, notices from the Assistant Commissioner of Police, Economic Offences Wing, Gurugram and the Office of the Assistant Commissioner of Police, Delhi, Economic Offences Wing in connection with an ongoing investigation being undertaken under the provisions of Prevention of Money Laundering Act, 2002 against IREO group of companies.
6. The company is dependent on its relationship with one of its Promoter's, ACME Cleantech and any adverse developments in such relationship may adversely affect its business and reputation.
7. While the company has extensive experience in commissioning solar power projects, the company does not have experience in commissioning wind, hybrid FDRE power projects and closed loop pump storage projects. Without prior experience in commissioning such projects the company could encounter delays, and unexpected costs, undermining project viability and profitability.
8. Any constraints in the availability of the electricity grid, including its inability to obtain access to transmission lines in a timely and cost-efficient manner, could adversely affect its business, results of operations and cash flows.
9. A certain portion of the land on which its renewable power projects are or will be located may requires certain approvals and permits in order for it to use such land for developing such projects. In the event the company is unable to obtain such approvals and permits, its business, results of operations, cash flows and financial condition could be adversely affected.
10. There is a limited pool of potential purchasers of utility scale quantities of electricity and the possibility that counterparties to its PPAs may not fulfill their obligations could expose it and its power projects to risks which could have an adverse effect on its business, results of operations and cash flows.