1. Increases in the prices of parts and materials required for its operations could adversely affect the company's business and results of operations.
2. Two of its Group Companies, Kia Corporation and Kia India Private Limited, are in a similar line of business as the company which may involve conflict of interests, which could adversely impact its business.
3. The company depends primarily on its Group Company, Mobis India Limited (being a subsidiary of Hyundai Mobis Co., Ltd. which is specialised in after-sale parts business for HMC Group Companies), to supply spare parts for after sale services to it and the company dealers. Further, its also depend on Mobis to supply modular parts to it that the company use in the manufacturing process of passenger vehicles and parts and constituted 17.91% of its total parts and materials supplied in the three months ended June 30, 2024. Any failure by Mobis to supply these parts could adversely impact its business. Further, Mobis may engage in transactions with it and other HMC Group Companies that may give rise to conflict situations.
4. The company depends on a limited number of suppliers for parts and materials. Any interruption in the availability of parts and materials could adversely impact its operations. Further, any failures by its suppliers to provide parts and materials to it on time or at all, or as per the company specifications and quality standards could have an adverse impact on its ability to meet its manufacturing and delivery schedules.
5. The company depends on HMC, its Promoter, for the company operations, including for parts and materials (such as engines and transmission assembly) and research and development. Any adverse change in its relationship with HMC and the companies in the Hyundai Motor Group could have an adverse impact on its business, reputation, financial condition, and results of operations.
6. The company has entered into the Royalty Agreement with HMC, its Promoter, and termination of the Royalty Agreement could adversely impact its business and results of operations.
7. Any increase in the royalty fee payable by the Company to HMC, its Promoter, under the Royalty
Agreement, including up to and exceeding the limits of 5% of the annual consolidated turnover of the Company as prescribed under the SEBI Listing Regulations, could adversely impact its profitability metrics, including the company earnings per share.
8. Its success depends on the company and HMC's ability to identify market trends, including technological trends, and meet evolving customer demands, while maintaining or improving its profitability. If the company is unable to do so, its sales volumes, business and results of operations would be adversely affected.
9. A significant portion of its sales volumes are derived from the sale of non-EV passenger vehicles, and there is no assurance that the company will be able to adopt its EV strategy successfully and cost-efficiently or at all.
10. Its global operations involve challenges and risks that could increase its costs, adversely affect the company results of operations and require increased time and attention from its management. Further, its primarily depends on HMC for the company exports business and revenue generated from its exports sales constitutes 22.34% and 23.70% of the company revenue from operations in Fiscal 2024 and in the three months ended June 30, 2024, and also need their prior permission for exports, including regarding the model and jurisdiction of its exports. Any failures or delay by HMC or it in accessing the export markets could have a material adverse effect on its results of operations and prospects.