Game Changers Texfab Ltd IPO

Deemed Manufacturing.

International Tie-ups.

Technology Integration.

Designer On-boarding Initiative.

Digital Commerce Arrangements.

Boutique Partnerships.

Retail and Online Expansion.

Its top customers contribute significant portion in the revenue of the Company. Any loss of business from one or more of them may adversely affect its revenues and profitability.

The company`s top suppliers contribute majority of the purchases. Any loss of business with one or more of them may adversely affect its business operations and profitability.

The Company has not entered into any long-term contracts with any of its customers and the company typically operate on the basis of purchase orders. Inability to maintain regular order flow would adversely impact the company revenues and profitability.

Its business depends on the deemed manufacturing units for bulk Customization, Value Additions and other manufacturing operations. Any loss of or shutdown of operations of these units on any grounds could adversely affect its business or results of operations.

Any change in its consumer`s likes, preferences or a change in their perception regarding the quality of the products may negatively affect the image and the reputation and in turn affect its revenues and profitability.

The future operating results are difficult to predict and may fluctuate or adversely vary from the past performance.

The company revenue seems to be quite concentrated, generating major part of its revenue from few domestic states.

There have been instances in the past where its have not made certain regulatory filings with the ROC and there were certain instances of discrepancies in relation to certain statutory filings and corporate records of the company.

The Company, Promoters, and Directors is involved in certain legal and regulatory proceedings. Any adverse decision in such proceedings may have a material adverse effect on its business, financial condition, cash flows and results of operations.

The company has delayed in filing some returns of statutory dues. Delays in making statutory payments may attract penalties, or any demand raised by statutory authorities in the future may affect the financial position of the company.

An inability to comply with repayment and other covenants in the financing agreements could adversely affect its business, financial condition, cash flows and credit rating.

If the company is unable to attract new clients the growth of the business and cash flows will be adversely affected.

The company limited digital presence may limit its growth and results of operations.

The company is dependent on third party logistics and support service providers for the delivery of raw materials and finished products and any disruptions in their services including transportation services or a decrease in the quality of their services may adversely affect its business, financial conditions and results of operations.

Its business is subject to seasonality.

The company registered office and retail stores are not located on land owned by it and is unregistered the company have only leasehold rights. Also in the event its lose or are unable to renew such leasehold rights, its business, results of operations, financial condition and cash flows may be adversely affected.

The company has significant power requirements for continuous running of the retail stores. Any disruption to the operations on account of interruption in power supply or any irregular or significant hike in power tariffs may have an effect on its business, results of operations and financial condition.

The company has entered into certain related party transactions and may continue to do so in future.

Any failures to protect or enforce the company rights to own or use the trademark could have an adverse effect on its business and competitive position.

Any delays and/or defaults in customer payments could result in increase of working capital investment and/or reduction of the Company`s profits, thereby affecting our operation and financial condition.

The company import Outdoor and PVC fabric from international suppliers and any adverse foreign exchange fluctuation could increase the cost of operations and affect its profitability. Further, any restriction or embargo on the sourcing of raw materials from certain countries could adversely affect its business and financial condition.

An inability to maintain adequate insurance cover in connection with its business may adversely affect the operations and profitability.

Any failures to obtain, renew and maintain requisite statutory and regulatory permits, licenses and approvals for the company operations from time to time may adversely affect its business.

The company has experienced negative cash flows from operating, investing as well as financing activities in the past year and may do so in the future, which could have a material adverse effect on its business, prospects, financial condition, cash flows and results of operations.

The company faces competition in its business from organized and unorganized players, which may adversely affect the business operation and financial condition.

The Company has not yet paid the applicable stamp duty on the allotment of securities. However, the process for making the stamp duty payment has been initiated and is currently underway. Non-payment of stamp duty may adversely affect its financial condition.

If the company service providers at deemed manufacturing units and its key suppliers from sourcing units is not able to or do not fulfil their service obligations, the company operations could be disrupted, and the operating results could be effected.

The company success largely depends upon its ability to attract and retain the Promoters, Directors, Key Managerial personnel with technical expertise. The company inability to attract and retain them and other personnel with technical expertise could adversely affect its business, financial condition and results of operations.

Its revenue from operations has reduced in Fiscal 2024 as compared to Fiscal 2023. If the company is unable to maintain or increase its revenue from operations, then it may have an adverse effect on the business operations and the growth strategies.

The company inability to manage inventory in an effective manner could affect its business.

The Issue Price, market capitalization to total income multiple, price to earnings ratio and enterprise value to EBITDA ratio based on the Issue Price of the Company, may not be indicative of the market price of the Equity Shares on listing.

The company has relied on the quotations received from third parties in relation to the funding Capital Expenditure towards opening of new stores which is proposed to be financed from the Issue proceeds of the IPO.

The deployment of funds raised through this Issue shall not be subject to any Monitoring Agency and shall be purely dependent on the discretion of the management of the Company.

The management will have broad discretion in how its apply the Net Proceeds, including interim use of the Net Proceeds, and there is no assurance that the objects of the Issue will be achieved within the time frame expected or at all, or that the deployment of the Net Proceeds in the manner intended by it will result in any increase in the value of the investment.

Its proposed capacity expansion plans is subject to the risk of unanticipated delays in implementation due to factors including delays in construction, obtaining regulatory approvals in timely manner and cost overruns.

The company funding requirements and the deployment of Net Proceeds is based on management estimates and quotations received and have not been independently appraised. Any variation in the utilisation of Net Proceeds of the Fresh Issue as disclosed in this Draft Red Herring Prospectus shall be subject to compliance requirements, including prior shareholders` approval.

Its ability to pay dividends in the future may be affected by any material adverse effect on the company future earnings, financial condition or cash flows.

The company is subject to the risk of failure of or a material weakness in its internal control systems.

Our top customers contribute significant portion in the revenue of the Company. Any loss of business from one or more of them may adversely affect our revenues and profitability.

Our top suppliers contribute majority of our purchases. Any loss of business with one or more of them may adversely affect our business operations and profitability

Our Company has not entered into any long-term contracts with any of its customers and we typically operate on the basis of purchase orders. Inability to maintain regular order flow would adversely impact our revenues and profitability.

Our business depends on our deemed manufacturing units for bulk Customization, Value Additions and other manufacturing operations. Any loss of or shutdown of operations of these units on any grounds could adversely affect our business or results of operations.

There have been instances of frequent changes in the statutory auditors of our Company in the past 3 financial years. We cannot assure you that such instances shall not occur in the future.

Any change in our consumer`s likes, preferences or a change in their perception regarding the quality of our products may negatively affect the image and our reputation and in turn affect our revenues and profitability.

There have been instances in the past where we have not made certain regulatory filings with the ROC and there were certain instances of discrepancies in relation to certain statutory filings and corporate records of our company.

Our business is subject to seasonality.

Our registered office and retail stores are not located on land owned by us and are unregistered we have only leasehold rights. Also in the event we lose or are unable to renew such leasehold rights, our business, results of operations, financial condition and cash flows may be adversely affected.

We have experienced negative cash flows from operating, investing as well as financing activities in the past year and may do so in the future, which could have a material adverse effect on our business, prospects, financial condition, cash flows and results of operations.

The future operating results are difficult to predict and may fluctuate or adversely vary from the past performance.

Our revenue seems to be quite concentrated, generating major part of our revenue from few domestic states.

Our Company, Promoters, and Directors are involved in certain legal and regulatory proceedings. Any adverse decision in such proceedings may have a material adverse effect on our business, financial condition, cash flows and results of operations.

The Company had initially failed to pay the applicable stamp duty on the allotment of securities, as required under the Indian Stamp Act, 1899 in a timely manner, the delayed payment of stamp duty may adversely affect our business operations and financial condition.

If our service providers at deemed manufacturing units and our key suppliers from sourcing units are not able to or do not fulfil their service obligations, our operations could be disrupted, and our operating results could be effected.

Our company has delayed in filing some returns of statutory dues. Delays in making statutory payments may attract penalties, or any demand raised by statutory authorities in the future may affect the financial position of the company.

An inability to comply with repayment and other covenants in the financing agreements could adversely affect our business, financial condition, cash flows and credit rating.

If we are unable to attract new clients the growth of our business and cash flows will be adversely affected.

Our limited digital presence may limit our growth and results of operations.

Our Promoter Group Entity, M/s Shree Balaji Tirpal Private Limited and M/s Capitol Enterprises is engaged in similar line of business in fabrics. Any conflict of interest in future may occur between the business of M/s Shree Balaji Tirpal Private Limited, M/s Capitol Enterprises and us which may adversely affect our business, prospects, results of operations and financial condition.

We are dependent on third party logistics and support service providers for the delivery of raw materials and finished products and any disruptions in their services including transportation services or a decrease in the quality of their services may adversely affect our business, financial conditions and results of operations.

We have significant power requirements for continuous running of our retail stores. Any disruption to our operations on account of interruption in power supply or any irregular or significant hike in power tariffs may have an effect on our business, results of operations and financial condition.

Our company has entered into certain related party transactions and may continue to do so in future.

Any failure to protect or enforce our rights to own or use our trademark could have an adverse effect on our business and competitive position.

Any delays and/or defaults in customer payments could result in increase of working capital investment and/or reduction of our Company`s profits, thereby affecting our operation and financial condition.

We import Outdoor and PVC fabric from international suppliers and any adverse foreign exchange fluctuation could increase our cost of operations and affect our profitability. Further, any restriction or embargo on the sourcing of raw materials from certain countries could adversely affect our business and financial condition.

An inability to maintain adequate insurance cover in connection with our business may adversely affect our operations and profitability.

Any failure to obtain, renew and maintain requisite statutory and regulatory permits, licenses and approvals for our operations from time to time may adversely affect our business.

We face competition in our business from organized and unorganized players, which may adversely affect our business operation and financial condition.

Our success largely depends upon our ability to attract and retain our Promoters, Directors, Key Managerial personnel with technical expertise. Our inability to attract and retain them and other personnel with technical expertise could adversely affect our business, financial condition and results of operations.

Our revenue from operations has reduced in Fiscal 2024 as compared to Fiscal 2023. If we are unable to maintain or increase our revenue from operations, then it may have an adverse effect on our business operations and our growth strategies.

Our inability to manage inventory in an effective manner could affect our business.

The Issue Price, market capitalization to total income multiple, price to earnings ratio and enterprise value to EBITDA ratio based on the Issue Price of our Company, may not be indicative of the market price of the Equity Shares on listing.

We have relied on the quotations received from third parties in relation to the funding Capital Expenditure towards opening of new stores which is proposed to be financed from the Issue proceeds of the IPO.

Our Promoters, Directors and KMPs may have interests other than reimbursement of expenses incurred and normal remuneration or benefits in our Company.

Our management will have broad discretion in how we apply the Net Proceeds, including interim use of the Net Proceeds, and there is no assurance that the objects of the Issue will be achieved within the time frame expected or at all, or that the deployment of the Net Proceeds in the manner intended by us will result in any increase in the value of your investment.

Our proposed capacity expansion plans are subject to the risk of unanticipated delays in implementation due to factors including delays in construction, obtaining regulatory approvals in timely manner and cost overruns.

Our funding requirements and the deployment of Net Proceeds are based on management estimates and quotations received and have not been independently appraised. Any variation in the utilisation of Net Proceeds of the Fresh Issue as disclosed in this Red Herring Prospectus shall be subject to compliance requirements, including prior shareholders` approval.

Our ability to pay dividends in the future may be affected by any material adverse effect on our future earnings, financial condition or cash flows.

We are subject to the risk of failure of or a material weakness in our internal control systems.

Strikes, work stoppages or other employee disputes could adversely affect our operations.