1. The lithium battery industry is vulnerable to supply chain disruptions caused by its reliance on a few critical raw materials like lithium, nickel, cobalt, graphite, and manganese, which, if disrupted, can lead to shortages and higher costs and adversely impact its profitability.
2. The company does not have long term contracts or exclusive arrangements with any of its suppliers, and a significant increase in the cost of, or a shortfall in the availability, or deterioration in the quality, of such input materials could have an adverse effect on its business and results of operations.
3. The company is dependent on, and derives a substantial portion of its revenue from, two customers, namely M/s Agarwal Trading Company and M/s. Hind Industries - both categorised as "Promoter Group entities". Reduction in orders from these customers could have a material adverse effect on its business, results of operations and financial condition. The dependency on these two customers may lead to real or potential conflicts of interest for the Company.
4. The company has had negative cash flows in the past and may have negative cash flows in the future.
5. The company is significantly reliant on the banking industry for sale of its products.
6. Heavy dependence on raw material imports from China poses a substantial risk for it, as disruptions due to political tensions or trade disputes can lead to supply chain interruptions, quality control issues, and heightened competition, which could adversely affect its business, results of operations and financial condition.
7. The loss of any of its key customers or significant reduction in production and sales of, or demand for the company products from its significant customers may adversely affect the company business, results of operations and financial condition.
8. The company has in past entered into related party transactions and its may continue to do so in the future.
9. Its Promoter is interested in the Company in the form of rental income from leasing of 5 factory units at Vasai in addition to provision of interest free unsecured loan.
10. If there is a decline in demand for the products where its batteries are used, it could significantly decrease the demand of its products and thereby affect the company business, financial condition, results of operations.