1. The company depends on a few customers for its products, for a significant portion of the company revenue, and any decrease in revenues or sales from any one of its key customers may adversely affect the company business and results of operations.
2. The company generates its major portion of sales from its operations in certain geographical regions. Any adverse developments affecting its operations in these regions could have an adverse impact on the company revenue and results of operations.
3. The company has a limited operating history in respect of its products, which may make it difficult for investors to evaluate the company business and prospects.
4. Its business is dependent on the sale of the company products to certain oil manufacturers with whom the Company has not entered into any long- term agreements purchasing its Rice Bran Oil. The loss of such customers, a significant reduction in purchases by such customers, or a lack of commercial success of their product of which the company is a major supplier could materially adversely affect its business, results of operations and financial condition.
5. The company derives significant portion of its revenues from the sale of by-products derived during the processing of rice bran oil and any reduction in demand from its consumers could have an adverse effect on the company business, results of operations and financial condition.
6. The company highly depends on its key raw material and a few key suppliers who help it procure the same. The company has not entered into long-term agreements with its suppliers for supply of raw materials. In the event the company is unable to procure adequate amounts of raw materials, at competitive prices its business, results of operations and financial condition may be adversely affected.
7. Its products are in the nature of commodities, and their prices are subject to fluctuations that may affect the company profitability.
8. All of its experience in respect of the company business operations is limited to manufacturing of rice bran oil and therefore the Company has limited experience of packaging its products and selling them on a retail basis. Hence, the company has limited exposure in operating a packaging line and marketing its products outside to retail customers, which may make it difficult to evaluate its past performance and prospects with respect to the same.
9. 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.
10. Its Group Company is engaged in a similar line of business as the Company and may compete with it.