Orkla India Ltd IPO

Objects of the Offer

• Drive household penetration and usage of our products in core markets.

• Expand presence in international markets through a robust growth strategy.

• Selectively expand product portfolio to strengthen and extend our core offerings.

• Drive operational efficiencies to improve margins and cash conversion.

• Continue to enhance capital efficiency.

• Strategically acquire leading brands and businesses.

• Category market leader with the ability to build and scale household food brands through an in-depth understanding of local consumer tastes.

• Multi-category food company with a focus on product innovation.

• Extensive distribution infrastructure with deep regional network and wide global reach.

• Efficient, large-scale manufacturing with stringent quality control and a robust supply chain.

• Experienced and tenured management team supported by strong global parentage.

• Capital efficient business model with a track record of delivering profitable growth.

• Our operations are subject to volatility in the pricing of raw materials and packaging materials. Our inability to procure the raw materials and packaging material, at competitive prices, may adversely affect our business, financial condition, cash flows and results of operations.

• The improper processing or storage of our products or raw materials, or spoilage of and damage to such products or raw materials, or any real or perceived contamination in our products or raw materials, could subject us to regulatory action, damage our reputation and have an adverse effect on our business, financial condition, cash flows and results of operations.

• Any slowdown or interruption to our manufacturing operations or under-utilisation of our existing or future manufacturing facilities may have an adverse impact on our business and financial performance.

• We are dependent on our suppliers (our top ten suppliers contributed to 37.9% in the three months ended June 30, 2025 and 33.7% of total purchases in Fiscal 2025) for raw materials. Any loss of suppliers or interruptions in the timely delivery of supplies could have an adverse impact on our business, financial condition, cash flows and results of operations.

• We are party to certain statutory and regulatory actions under Food Safety and Standards Act, 2006 and any adverse outcome in such matters may adversely impact our business and operations.

• A third-party owned and operated restaurant chain has the right to use the trade name "MTR" for its business operations and any negative publicity or quality issues associated with the restaurant chain may adversely affect our business, financial condition, cash flows and results of operations.

• Our inability to expand or effectively manage our growing base of distributors or retailers may have an adverse effect on our business, financial condition, cash flows and results of operations.

• The examination report on our Restated Consolidated Financial information makes reference to certain modifications included in the audit reports on our consolidated financial statements and in the annexure to the reports prescribed under the Companies (Auditor`s Report) Order, 2020 as of and for the three months ended June 30, 2025 and Fiscals 2025, 2024 and 2023.

• We have in the past entered into related party transactions and will continue to do so in the future and there is no assurance that we could not have achieved more favourable terms if such transactions had not been entered into with related parties.

• We derive a portion of our revenue from sale of products to customers outside India (20.4% and 20.6% in the three months ended June 30, 2025 and in Fiscal 2025). Our inability to effectively manage our exports or comply with regulations in countries to which we export, may adversely affect our business, financial condition, cash flows and results of operations.

• We are subject to extensive regulations relating to food health and safety matters. Any non-compliance with or changes in such regulations applicable to us may adversely affect our reputation, business, financial condition, cash flows and results of operations.

• The sale of our products is concentrated in South India (contributing to 70.0% and 70.2% of our revenue from sale of products in the three months ended June 30, 2025 and in Fiscal 2025). Additionally, eight of our nine owned manufacturing facilities and 15 of our 18 contract manufacturing facilities in India are located in South India, as of June 30, 2025 . As a result, we may be adversely affected by unfavourable events affecting this region.

• An inability to anticipate and adapt to evolving consumer tastes, preferences and demand, to foresee a reduction in consumer preference for our products or to ensure product quality, may adversely impact demand for our products, brand loyalty and consequently our business prospects and financial performance.

• Any delay or default in payments from our distributors or retailers could result in the reduction of our profits and adversely affect our financial condition.

• We are unable to trace some of our historical records including forms filed with the RoC, and certain of our forms are undated and / or unstamped and / or have factual discrepancy. There is no assurance that regulatory proceedings or actions will not be initiated against us in the future and that we will not be subject to any penalty imposed by the competent regulatory authority in this regard.

• Our Promoter, Orkla ASA, has issued a Letter of Authorisation to our Company for usage of the "Orkla" trademark by us, and a termination of this Letter of Authorisation, or the imposition of any fees or royalty by Orkla ASA on us in the future, could adversely impact our business and operations.

• Our financial and operational performance may be adversely affected if we are not successful in managing our inventory or working capital.

• Termination of our agreements in relation to the contract manufacturing facilities may adversely affect our business, financial condition, cash flows and results of operations.

• Climate change and weather patterns may impact our ability to procure raw materials, which in turn may adversely affect our business, financial condition, cash flows and results of operations.

• We rely on contract labour for carrying out certain of our functions at our manufacturing facilities and warehouses. Non-availability of contract workers at reasonable cost or increased wage demands could lead to disruption in our manufacturing facilities and/or increased production costs, which could adversely impact our business, financial condition, cash flows and results of operations.

• We may be unable to adequately obtain, maintain, protect and enforce our intellectual property rights. We may also be subject to intellectual property infringement claims, which may be expensive to defend and may disrupt our business and operations.

• Our business, financial condition, cash flows and results of operations may be adversely affected if we are unable to maintain, protect and grow our brand image.

• The industry we operate in is labour-intensive and our business and operations may be affected by strikes, work stoppages or increased wage demands by our employees.

• We are exposed to risks in relation to the availability and fluctuations in the prices of power, fuel and water. Any shortage or non-availability of power, fuel and water at reasonable cost and in a timely manner could have an adverse impact on our business, financial condition, cash flows and results of operations.

• Competition in the industry in which we operate could result in a reduction in our market share or require us to reduce our price points or incur substantial expenditure on advertising and marketing, all of which could adversely affect our business, financial condition, cash flows and results of operations.

• An inability to comply with health, safety and environmental laws and regulatory standards may adversely affect our business, financial condition and results of operations.

• We are required to obtain, renew or maintain statutory and regulatory permits, licences and approvals to operate our business, and any delay or inability in obtaining, renewing or maintaining such permits, licences and approvals could result in an adverse effect on our business, financial condition, cash flows and results of operations.

• We may pursue opportunities for inorganic growth. Our efforts at integrating acquired businesses may not yield timely or effective results, which may affect our financial condition, cash flows and results of operations.

• We are subject to counterfeit, cloned and pass-off products, which may reduce our sales and harm the reputation and goodwill of our brands.

• Discontinuance or non-availability of government grants enjoyed by us or our inability to comply with related requirements may have an adverse effect on our business and results of operations

• We may not be able to achieve anticipated benefits from our product development initiatives and a failure to successfully develop our product portfolio may have adverse effect on our business, financial condition, cash flows and results of operations.

• There are outstanding litigations against our Company, Directors and Promoter. An adverse outcome in any of these proceedings may affect our reputation and standing and impact our future business and could have a material adverse effect on our business, financial condition, cash flows and results of operations.

• We may not be able to sustain our past rate of growth in the future.

• Our profitability, margins and other metrics may be attributable to factors that may be non-recurring or outside our control, and any reversal of such factors could adversely affect our business, financial condition, cash flows and results of operations.

• We depend on our Promoter, Orkla ASA and other entities of the Orkla group for various advisory services and procurement services pertaining to our operations. Any adverse change in our relationship with Orkla ASA and the companies in the Orkla group could have an adverse impact on our reputation, business, financial condition, cash flows and results of operations.

• We are dependent on third-party transportation providers for delivery of raw materials purchased by us from our suppliers (the cost of which is typically borne by our suppliers) and delivery of our products, and any failure on the part of such service providers to meet their obligations could adversely affect our business, financial condition, cash flows and results of operations.

• We sell our products through e-commerce websites and quick-commerce platforms, which face distinct risks and our failure to successfully manage those risks could have a negative impact on our profitability.

• There have been certain instances of delays in payment of statutory dues by us during the three months ended June 30, 2025 and the last three fiscals 2025, 2024 and 2023. Any delay in payment of statutory dues by us in the future, may result in the imposition of penalties and in turn may have an adverse effect on our business, financial condition, cash flows and results of operations

• Our inability to adopt new technologies to adhere to our quality product standards could adversely affect our business, financial condition, cash flows and results of operations.

• Our operations require a significant amount of working capital. Any inability to meet our working capital requirements may adversely affect our business, financial condition, cash flows and results of operations.

• Damage to and / or malfunction of any of our operating systems or cyber security risks could disrupt our operations and adversely affect our business, financial condition, cash flows and results of operations.

• Certain regulatory filings required to be made with the RBI under applicable law have been made with delays and have been compounded with the RBI

• We have certain contingent liabilities that have not been provided for in our financial statements, which if they materialise, may adversely affect our financial condition.

• Our success depends in large part upon our KMPs, SMPs and certain other employees and any inability to attract, train and retain such persons could adversely affect our business, financial condition, cash flows and results of operations.

• We are exposed to losses due to fraud, employee negligence, theft or similar incidents, which may have an adverse impact on our business, financial condition, cash flows and results of operations.

• Our insurance coverage may not be sufficient or may not adequately protect us against risks and unexpected events, which may adversely affect our business, financial condition, cash flows and results of operations.

• We cannot assure payment of dividends on the Equity Shares in the future and our ability to pay dividends in the future will depend on our earnings, financial condition, cash flows, working capital requirements, capital expenditures and the covenants of our financing arrangements.

• Certain sections of this Red Herring Prospectus disclose information from the Technopak Report which has been prepared exclusively for the Offer and commissioned and paid for by us exclusively in connection with the Offer and any reliance on such information for making an investment decision in the Offer is subject to inherent risks.

• An inability to establish and maintain effective internal controls could lead to an adverse effect on our business, financial condition, cash flows and results of operations.

• Our Promoters will continue to retain significant shareholding in our Company after the Offer, which will allow them to exercise significant influence over us.

• Our business may be impacted by seasonal variations in sales volumes.

• Our Registered Office and five of our manufacturing facilities are situated on leased premises. In the event that we lose such rights or are required to renegotiate arrangements for such rights or are unable to obtain consent under our leasehold / licensing arrangements, our business, financial condition, cash flows and results of operations may be adversely affected.

• We face foreign exchange risks that could adversely affect our results of operations and cash flows.

• Information relating to the historical capacity of our manufacturing facilities included in this Red Herring Prospectus is based on various assumptions and estimates and our future production and capacity may vary.

• We had current borrowings of Rs.23.3 million as of June 30, 2025 and may incur further indebtedness in the future and be required to comply with certain restrictive covenants and conditions under such financing agreements. Any non-compliance may lead to, accelerated repayment schedule, enforcement of security and suspension of further drawdowns, which may adversely affect our business, financial condition, cash flows and results of operations.

• We have in this Red Herring Prospectus included certain non-GAAP financial measures and certain other industry measures related to our operations and financial performance that may vary from any standard methodology that is applicable across the industry in which we operate.

• We operate windmills and generate a portion of our revenue from operations (0.1% and 0.1% in the three months ended June 30, 2025 and Fiscal 2025, respectively) from the sale of energy from windmills (as per Ind AS 115 - Revenue from Contracts with Customers). The operation of windmills is subject to various risks, which could have an adverse impact on our business, financial condition, cash flows and results of operations.

• Our Company will not receive any proceeds from the Offer for Sale.

• Our Promoters, Directors, Key Managerial Personnel and Senior Management have interests in us other than the reimbursement of expenses incurred and normal remuneration and benefits.

• Certain of the entities forming part of our Promoter Group are in a similar line of business as us which may involve conflict of interests, which could adversely impact our business.