Studds Accessories Ltd IPO

Largest domestic player of two-wheeler helmets.

Wide design and product catalogue across price points catering to diverse consumer requirements.

Advanced manufacturing and D&D capabilities with vertically integrated operations.

Strong pan-India and global presence supported by an extensive and well-developed sales and dealer network and major quality accreditations.

Capital efficient and sustainable business model.

Experienced Promoters and Management team.

The sales of our products will suffer if we are unable to maintain and/ or enhance the `Studds` and `SMK` brands, which would have a material adverse effect on our business, financial condition, results of operations and brand equity.

The sale of two-wheeler helmets manufactured by us contributes a significant portion to total sales (92.81%, 92.43%, 92.44% and 91.91% for the three months ended June 30, 2025 and Fiscals 2025, 2024, and 2023, respectively). Any decrease in motorcycle sales could have an adverse effect on our business, cash flows, results of operation and financial position.

Our continued operations at our manufacturing facilities are critical to our business and any disruption, breakdown or shutdown of our manufacturing facilities may have a material adverse effect on our business, financial condition, results of operations and cash flows.

We incur significant expenses in relation to the procurement of our primary raw materials. In the event we are unable to procure adequate amounts of raw material, at competitive prices, our business, results of operations and financial condition may be adversely affected. Further, we do not generally enter into agreements with the suppliers and accordingly may face disruptions in supply from the current suppliers.

In the past, for instance designs for our products, such as, Stellar - Wings were not well received by customers in the three months ended June 30, 2025 and Fiscals 2025, 2024 and 2023 and if we are unable to provide new designs or update our product catalogue in accordance with customer preference, it may adversely affect our business prospects, results of operations and cash flows.

We are dependent on certain raw material suppliers (which accounted for more than 40% in the three months ended June 30, 2025 and Fiscals 2025, 2024 and 2023). Any disruption in their operations or the inability of such suppliers to supply the raw materials in the quantities we require, may have an adverse effect on our business, results of operations and financial condition.

We have made certain issuances and allotments of our Equity Shares which were not in compliance with section 67(3) of the Companies Act, 1956.

Failure or delays in obtaining third party certifications and accreditations may cause delays in our delivery schedules and disruptions in our business which may adversely affect our business, financial condition and results of operations.

Our Company has been delayed in filing Form FC-GPR for allotment of shares to certain NRI shareholders pursuant to the bonus issue undertaken by our Company on January 11, 2025. We have been unable to file the form FC-GPR on account on lack of clarity on the mode of investment of certain NRI shareholders or due to non-filing of the Form FC-TRS by certain other NRI shareholders at the time of their investment in our Company. We cannot assure that we will able to file the Form FC-GPR in a timely manner, and consequently we may be subject to regulatory actions and penalties/compounding fees, as applicable.

We have made certain issuances and allotments of our Equity Shares which were not in compliance with section 67(3) of the Companies Act, 1956.

In the past, we have experienced instances of non-compliance with certain provisions of the Companies Act, 1956 and the Companies Act, 2013, including delays in transferring our Company`s equity shares to the Investor Education and Protection Fund (IEPF) account subsequent to unclaimed dividends. We have also approved appointment of the Managing Director after reaching the age of 70, without including the required rationale in explanatory statement in the shareholders` meeting notice, with respect to which we have filed an adjudication application before the Registrar of Companies, Delhi, which is currently pending.

There have been instances of delayed filings, certain of our corporate records not being traceable and there being inadvertent errors while filing the requisite forms.

Our business and financial performance is dependent on export sales of our products across our international markets (which was 15.51%, 10.06%, 13.60% and 21.03% for the six months ended September 30, 2024 and Fiscals 2024, 2023, and 2022, respectively). Any decrease in the demand for our products in these markets or an inability to increase or effectively manage our sales to such markets may adversely affect our business, financial condition and results of operations. Further, increase in the anti-dumping duties in such countries or the entry into free trade agreements with such countries may adversely affect our business, financial condition and results of operations.

We regularly work with hazardous materials and activities in our operation which can be dangerous and could cause injuries to people or property.

Any failure in our quality control processes, whether in India or outside India, may have an adverse effect on our business, results of operations and financial condition. We may have to recall, repair or repurchase our products or face product liability claims and legal proceedings if the quality of our products does not meet our customers` expectations.

We may be unable to fully realize the anticipated benefits of our acquisition of and any future acquisitions or within our expected timeframe.

Under-utilization of our manufacturing facilities and an inability to effectively utilize our expanded manufacturing facilities could have an adverse effect on our business, prospects and future financial performance.

We sell our products through a pan-India network of distributors. We have not entered into long-term agreements with our distributors, and any loss of distributors or interruptions in the timely delivery/distribution of our products could have an adverse impact on our business, financial condition, cash flows, and results of operation. Our distribution network is vital to our business and if we are unable to expand or effectively manage our distribution network, it could have an adverse effect on our business, financial condition and results of operations.

In the event that we fail to obtain, maintain or renew our statutory or regulatory licenses, permits and approvals required to operate our business, financial condition and results of operations may be adversely affected.

Our operations are subject to various operational risks and could also be adversely affected by strikes, work stoppages or increased wage demands by our employees or any other kind of disputes with our employees and any disruption in operations at the manufacturing facilities by our employees may have an adverse impact on our business, results of operations and financial condition.

A portion of one of our Manufacturing Facility- I is situated on leased premises. There can be no assurance that the lease agreement will be renewed upon termination or that we will be able to obtain other premises on lease on same or similar commercial terms.

We have power and fuel requirements and any disruption to power sources could increase our production costs and adversely affect our business and results of operations.

Products manufactured by us could expose us to potential product liability, warranty liability or personal injury claims and litigation in USA.

Exchange rate fluctuations in various currencies in which we do business could materially and adversely impact our business, financial condition and results of operations.

We may not successfully protect our technical know-how, which may result in the loss of our competitive advantage.

Our success also depends to an extent on our research and development capabilities and failure to derive the desired benefits from our product research and development efforts may have an adverse impact on our competitiveness and profitability.

Our operations are dependent on our ability to attract and retain skilled personnel and any inability on our part to do so, could adversely affect our business, results of operations and financial condition.

Non-compliance with and changes in, safety, health, labour and environmental laws and other applicable regulations, may adversely affect our business, results of operations and financial condition.

Information relating to the installed capacity, actual production and capacity utilisation of our manufacturing facilities included in this Draft Red Herring Prospectus are based on various assumptions and estimates and future production and capacity may vary.

We appoint contract labour for handling and loading, of materials and for providing security services at our manufacturing facilities. We may be held responsible for paying the wages of such workers, if the independent contractors through whom such workers are hired default on their obligations, and such obligations could have an adverse effect on our results of operations, cash flows and financial condition.

India has stringent labour legislations that protect the interests of workers, and if our employees unionize, we may be subject to industrial unrest, slowdowns and increased wage costs.

Our operations are subject to risks such as breakdown of equipment, accidents and natural disasters. If any of these risks were to materialize, our business and results of operations could be adversely affected.

There are various legal proceedings involving our Company, our Promoters and certain of our Directors, which if determined against us or them, may have an adverse effect on our business, results of operations and our reputation.

The imposition of penalty on our Chairman and Managing Director could adversely affect our reputation and our business.

Failure or delays in obtaining third party certifications and accreditations may cause delays in our delivery schedules and disruptions in our business which may adversely affect our business, financial condition and results of operations.

Our inability to estimate demand and consequently maintain an optimal level of inventory in our manufacturing facilities may impact our operations adversely.

Any delay or default in payments from dealers or customers could result in the reduction of our profits.

We are dependent on third party transportation providers for the supply of raw materials and delivery of our products.

Our industry is competitive and our inability to compete effectively may adversely affect our business, results of operations, financial condition and cash flows.

We have in the past entered into related party transactions and may do so in the future. We cannot assure you that we could not have achieved more favourable terms if such transactions had not been entered into with related parties.

Our insurance coverage may not be sufficient or may not adequately protect us against all material hazards, which may adversely affect our business, results of operations and financial condition.

We have witnessed negative cash flow from financing and investing activities in the past. Any negative cash flows in the future would adversely affect our cash flow requirements, which may adversely affect our ability to operate our business and our financial condition.

We are dependent on a number of key managerial personnel, including our senior management and business heads, and the loss of or our inability to attract or retain such persons could adversely affect our business, results of operations and financial condition.

Our inability to maintain a strong sales team or a decrease in their productivity or any termination of our distribution arrangements may adversely affect our business, financial condition and results of operations.

Our business is subject to seasonality. Lower revenues in the second quarter of any Fiscal may adversely affect our business, financial condition, results of operations and prospects.

The growth of online retailers may adversely affect our pricing ability, which may have an adverse effect on our results of operations and financial condition.

Significant disruptions of information technology systems or breaches of data security or inability to adapt to technological changes could adversely affect our business.

Our operating expenses include fixed costs that are not dependent upon our volume of business. As a result, any decline in our operating performance may be magnified because we may be unable to reduce expenses immediately, or at all in response to a potential shortfall in volume of business.

We may be exposed to risks arising from the uncertainty of title of the land where our manufacturing facilities are situated.

Our loan agreement contains restrictive covenants which may adversely affect our business, results of operations and financial conditions.

Any increase in interest rates or downward revision of our credit ratings of, CARE A+; Stable rating for long term borrowings and CARE A1+ for short term borrowings, could have an adverse effect on our results of operations.

We have in this Draft 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 we operate.

Our Promoters and certain of our Directors and Key Managerial Personnel have interests in us other than reimbursement of expenses incurred, dividend received and normal remuneration or benefits.

The average cost of acquisition of Equity Shares of the Selling Shareholders may be lower than the Offer Price.

We have issued Equity Shares during the preceding 12 months at prices that may be lower than the Offer Price. We cannot assure you that we will not issue Equity Shares in the future at a price lower than the Offer Price.

Our Promoters, together with our Promoter Group will continue to retain majority shareholding in our Company after the Offer, which will allow them to exercise significant control over us. We cannot assure you that our Promoters and Promoter Group will always act in the best interests of the Company or you.

Our ability to pay dividends in the future will depend upon profitability, operating cash flow, earnings`stability and liquidity position of the Company, in our financing arrangements.

If any of our contingent liabilities materialize, our liquidity, business, prospects, financial condition and results of operations could be adversely affected.

If any of our contingent liabilities materialize, our liquidity, business, prospects, financial condition and results of operations could be adversely affected.

We may, from time to time, look for opportunities to enter strategic alliances, acquire businesses or enter into joint venture arrangements. Any failure to manage the integration of the businesses or facilities post such acquisition or joint venture may cause our profitability to suffer.

Industry information included in this Draft Red Herring Prospectus has been derived from an industry report commissioned by us for such purpose. There can be no assurance that such third-party statistical, financial and other industry information is either complete or accurate.

We have witnessed negative cash flow from financing and investing activities in the past. Any negative cash flows in the future would adversely affect our cash flow requirements, which may adversely affect our ability to operate our business and our financial condition.

Under-utilization of our manufacturing facilities and an inability to effectively utilize our expanded manufacturing facilities could have an adverse effect on our business, prospects and future financial performance.

Information relating to the installed capacity, actual production and capacity utilisation of our manufacturing facilities included in this Red Herring Prospectus are based on various assumptions and estimates and future production and capacity may vary.

We depend on sale of our products to OEMs and government customers, which accounted for more than 15% in each of the three months ended June 30, 2025, and Fiscal 2025. An economic slowdown or factors affecting demand of our products by OEMs and government customers may have an adverse effect on our business, financial condition and results of operations.

Our inability to protect or use our intellectual property rights may adversely affect our business.

We do not have any listed peers in India or globally with a comparable scale of operations, or financial profile in same industry, which may affect the comparability of information with respect to our performance and valuation. Therefore, investors must rely on their own examination of our Company.

Our Company has been delayed in filing Form FC-GPR for allotment of shares to certain NRI shareholders pursuant to the bonus issue undertaken by our Company on January 11, 2025. We have been unable to file the form FC-GPR on account on lack of clarity on the mode of investment of certain NRI shareholders or due to non-filing of the Form FC-TRS by certain other NRI shareholders at the time of their investment in our Company. We cannot assure that we will able to file the Form FC-GPR in a timely manner, and consequently we may be subject to regulatory actions and penalties/ compounding fees, as applicable.

In the past, we have experienced instances of non-compliance with certain provisions of the Companies Act, 1956 and the Companies Act, 2013, including delays in transferring our Company`s equity shares to the Investor Education and Protection Fund (IEPF) account subsequent to unclaimed dividends. We have also approved appointment of the Managing Director after reaching the age of 70, without including the required rationale in explanatory statement in the shareholders` meeting notice, with respect to which we have filed an adjudication application before the Registrar of Companies, Delhi, which is currently pending.

There have been instances of delayed filings, certain of our corporate records not being traceable and there being inadvertent errors while filing the requisite forms.

Our business and financial performance is dependent on export sales of our products across our international markets (which was 21.74%, 16.63%, 10.06% and 13.60% for the three months ended June 30, 2025 and Fiscals 2025, 2024, and 2023, respectively). Any decrease in the demand for our products in these markets or an inability to increase or effectively manage our sales to such markets may adversely affect our business, financial condition and results of operations. Further, increase in the anti-dumping duties in such countries or the entry into free trade agreements with such countries may adversely affect our business, financial condition and results of operations.

Our business is subject to seasonality. Lower revenues in the second quarter of any Fiscal may adversely affect our business, financial condition, results of operations and prospects.

Any failure in our quality control processes, whether in India or outside India, may have an adverse effect on our business, results of operations and financial condition. We may have to recall, repair or repurchase our products or face product liability claims and legal proceedings if the quality of our products does not meet our customers` expectations.

We may be unable to realize the expected benefits from our acquisition of Bikerz US Inc. or any future acquisitions, within the anticipated timeframe or at all.

We sell our products through a pan-India network of distributors. We have not entered into long-term agreements with our distributors, and any loss of distributors or interruptions in the timely delivery/distribution of our products could have an adverse impact on our business, financial condition, cash flows, and results of operation. Our distribution network is vital to our business and if we are unable to expand or effectively manage our distribution network, it could have an adverse effect on our business, financial condition and results of operations.

In the event that we fail to obtain, maintain or renew our statutory or regulatory licenses, permits and approvals required to operate our business, financial condition and results of operations may be adversely affected.

Our operations are subject to various operational risks and could also be adversely affected by strikes, work stoppages or increased wage demands by our employees or any other kind of disputes with our employees and any disruption in operations at the manufacturing facilities by our employees may have an adverse impact on our business, results of operations and financial condition.

A portion of one of our Manufacturing Facility- I is situated on leased premises. There can be no assurance that the lease agreement will be renewed upon termination or that we will be able to obtain other premises on lease on same or similar commercial terms.

We have power and fuel requirements and any disruption to power sources could increase our production costs and adversely affect our business and results of operations.

Products manufactured by us could expose us to potential product liability, warranty liability or personal injury claims and litigation in USA.

Exchange rate fluctuations in various currencies in which we do business could materially and adversely impact our business, financial condition and results of operations.

We may not successfully protect our technical know-how, which may result in the loss of our competitive advantage.

Our success also depends to an extent on our research and development capabilities and failure to derive the desired benefits from our product research and development efforts may have an adverse impact on our competitiveness and profitability.

Our operations are dependent on our ability to attract and retain skilled personnel and any inability on our part to do so, could adversely affect our business, results of operations and financial condition.

We regularly work with hazardous materials and activities in our operation which can be dangerous and could cause injuries to people or property.

Non-compliance with and changes in, safety, health, labour and environmental laws and other applicable regulations, may adversely affect our business, results of operations and financial condition.

We appoint contract labour for handling and loading, of materials and for providing security services at our manufacturing facilities. We may be held responsible for paying the wages of such workers, if the independent contractors through whom such workers are hired default on their obligations, and such obligations could have an adverse effect on our results of operations, cash flows and financial condition.

India has stringent labour legislations that protect the interests of workers, and if our employees unionize, we may be subject to industrial unrest, slowdowns and increased wage costs.

Our operations are subject to risks such as breakdown of equipment, accidents and natural disasters. If any of these risks were to materialize, our business and results of operations could be adversely affected.

There are various legal proceedings involving our Company, our Promoters and certain of our Directors, which if determined against us or them, may have an adverse effect on our business, results of operations and our reputation.

The imposition of penalty on our Chairman and Managing Director could adversely affect our reputation and our business.

Our inability to estimate demand and consequently maintain an optimal level of inventory in our manufacturing facilities may impact our operations adversely.

Any delay or default in payments from dealers or customers could result in the reduction of our profits.

We are dependent on third party transportation providers for the supply of raw materials and delivery of our products.

Our industry is competitive and our inability to compete effectively may adversely affect our business, results of operations, financial condition and cash flows.

We have in the past entered into related party transactions and may do so in the future. We cannot assure you that we could not have achieved more favourable terms if such transactions had not been entered into with related parties.

Our insurance coverage may not be sufficient or may not adequately protect us against all material hazards, which may adversely affect our business, results of operations and financial condition.

We are dependent on a number of key managerial personnel, including our senior management and business heads, and the loss of or our inability to attract or retain such persons could adversely affect our business, results of operations and financial condition.

Our inability to maintain a strong sales team or a decrease in their productivity or any termination of our distribution arrangements may adversely affect our business, financial condition and results of operations.

The growth of online retailers may adversely affect our pricing ability, which may have an adverse effect on our results of operations and financial condition

Significant disruptions of information technology systems or breaches of data security or inability to adapt to technological changes could adversely affect our business.

Our operating expenses include fixed costs that are not dependent upon our volume of business. As a result, any decline in our operating performance may be magnified because we may be unable to reduce expenses immediately, or at all in response to a potential shortfall in volume of business.

We may be exposed to risks arising from the uncertainty of title of the land where our manufacturing facilities are situated.

Our loan agreement contains restrictive covenants which may adversely affect our business, results of operations and financial conditions.

Any increase in interest rates or downward revision of our credit ratings of, CARE A+; Stable rating for long term borrowings and CARE A1+ for short term borrowings, could have an adverse effect on our 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 we operate.

Our Promoters and certain of our Directors and Key Managerial Personnel have interests in us other than reimbursement of expenses incurred, dividend received and normal remuneration or benefits.

The average cost of acquisition of Equity Shares of the Selling Shareholders may be lower than the Offer Price.

We have issued Equity Shares during the preceding 12 months at prices that may be lower than the Offer Price. We cannot assure you that we will not issue Equity Shares in the future at a price lower than the Offer Price.

Our Promoters, together with our Promoter Group will continue to retain majority shareholding in our Company after the Offer, which will allow them to exercise significant control over us. We cannot assure you that our Promoters and Promoter Group will always act in the best interests of the Company or you.

Our ability to pay dividends in the future will depend upon profitability, operating cash flow, earnings` stability and liquidity position of the Company, in our financing arrangements.

If any of our contingent liabilities materialize, our liquidity, business, prospects, financial condition and results of operations could be adversely affected.

If we are subject to any frauds, theft, employee negligence or embezzlement by our employees, contractors and customers, it could adversely affect our reputation, financial condition and results of operations.

We may, from time to time, look for opportunities to enter strategic alliances, acquire businesses or enter into joint venture arrangements. Any failure to manage the integration of the businesses or facilities post such acquisition or joint venture may cause our profitability to suffer.

Industry information included in this Red Herring Prospectus has been derived from an industry report commissioned by us for such purpose. There can be no assurance that such third-party statistical, financial and other industry information is either complete or accurate.

Our Directors on our Board do not have prior experience of directorship in any of companies listed on recognized stock exchanges, therefore, they will be able to provide only a limited guidance in relation to the affairs of our Company post listing.