1. The strength of the brands the company use are crucial to its success. Any reputational damage to the brand, name or logo could have an adverse effect on its financial condition, cash flows and results of operations.
2. Its inability to effectively market the company products, or any deterioration in public perception of its brand, could affect consumer footfall and consequently adversely impact its business, financial condition, cash flows and results of operations.
3. Its inability to identify market trends and customer demand accurately and maintain an optimal level of inventory in its stores may impact the company operations adversely.
4. Its business is primarily concentrated in Maharashtra and the company is significantly dependent on top five of its stores located in Maharashtra for revenue generation. Any adverse development affecting such region or stores may have an adverse effect on its business, prospects, financial condition and results of operations.
5. The Company requires significant amounts of working capital for continued growth. Its inability to meet the company working capital requirements, on commercially acceptable terms, may have an adverse impact on its business,
financial condition and results of operations.
6. While we commenced our e-commerce operations in Fiscal 2014, we focus primarily on a brick-and-mortar model to establish our physical presence in India. Since, we operate in highly competitive and fragmented markets, and competition in these markets is based primarily on market trends, pricing and customer preferences, there can be no assurance that we can effectively compete with our competitors in the future, and any such failure to compete effectively may have a material adverse effect on our business, financial condition, results of operations and prospects.
7. If we are unable to effectively manage or expand our retail network and operations or open new stores operated by our Company in accordance with our business plan, or pursue our growth strategy, our existing and new stores may not achieve our expected levels of profitability which may adversely affect our business prospects, financial condition and results of operations.
8. We do not own the trademark for our key flagship "PNG" brand and we require the written approval of P N Gadgil Jewellers for assigning or sub-licensing the trademark to any person, except our Subsidiaries, joint ventures or associates or franchise partners.
9. We are dependent on third party artisans for the production and manufacturing of all of our products. Any disruptions at such third-party production or manufacturing facilities, or shortage or scarcity of Karigars in the
jewellery industry especially in Maharashtra or failure of such third parties to adhere to the relevant quality standards may have a negative effect on our reputation, business and financial condition and results of operations.
10. Our manufacturing work is done by skilled craftsmen who do not work exclusively for us which exposes us to any risks/adverse developments affecting the skilled craftsmen.