ACME Solar Holdings Limited - IPO

1. The company may not be able to grow its portfolio of renewable energy power projects as the company relies on highly competitive renewable energy power project auctions. Further, its future growth is significantly dependent on successfully executing its Under Construction Awarded Projects and Under Construction Contracted Projects. In the event, the company is not successful in executing its future projects, its business and results of operations may be adversely impacted.

2. The company is dependent on its Power Purchase Agreements ("PPA") to sell power and generate its revenue from operations. Further, the terms of its PPAs may expose it to certain risks that may affect its future results of operations and cash flows.

3. Its business is dependent on the company's top 10 off-takers, which contributed 95.42%, 89.42%, 89.97%, 87.48% and 81.11% of its revenue from operations during the three months ended June 30, 2024 and June 30, 2023 and for Fiscal 2024, 2023 and 2022, respectively. The loss of any of these off-takers could have an adverse effect on its business, financial condition, results of operations and cash flows.

4. The company procured 84.48%, 77.15%, 79.37%, 69.84% and 69.95% of its total purchases during the three months ended June 30, 2024 and June 30, 2023 and in Fiscal 2024, 2023 and 2022, respectively from ACME Cleantech, its top supplier. Further, the company does not have definitive supply agreements with its vendors for the supply of components and any interruptions in supply could adversely affect its business, financial condition, results of operations and cash flows.

5. The company is dependent on its relationship with one of its Promoters, ACME Cleantech and any adverse developments in such relationship may adversely affect its business and reputation.

6. The Company, ACME Cleantech and ACME Solar Energy have received certain office orders from the Directorate of Enforcement in connection with investigations under the Foreign Exchange Management Act, 1999, as amended. MKU Holdings has also received a questionnaire from the Directorate of Enforcement and subsequently, notices from the Assistant Commissioner of Police, Economic Offences Wing, Gurugram and the Office of the Assistant Commissioner of Police, Delhi, Economic Offences Wing in connection with an ongoing investigation being undertaken under the provisions of Prevention of Money Laundering Act, 2002 against IREO group of companies.

7. While the company has extensive experience in commissioning solar power projects, the company does not have experience in commissioning wind, hybrid FDRE power projects and closed loop pump storage projects. Without prior experience in commissioning such projects the company could encounter delays, and unexpected costs, undermining project viability and profitability.

8. Restrictions on renewable energy equipment imports may increase its costs of procurement of such equipment.

9. The company Joint Statutory Auditors have included certain emphasis of matters in their examination report on the Restated Consolidated Financial Information. There can be no assurance that any similar emphasis of matters will not form part of its financial statements for the future fiscal periods, which could subject it to additional liabilities due to which its reputation and financial condition may be adversely affected.

10. The company incurred loss for the year of Rs.31.74 million in Fiscal 2023. Its cannot assure you that going forward the company will continue to generate profits which may impact its business and results of operations.