Garuda Construction and Engineering Limited - IPO

1. Our total revenue comes from our top 10 clients, mainly our promoter related entities and group companies. The loss of any of our significant clients may have an adverse effect on our business, financial condition, results of operations, and prospect.

2. As a construction company, our limited experience in dealing with unrelated third-party entities presents challenges for our growth. If we cannot establish ourselves successfully as developers or contractors beyond our promoter group and associated companies, our longterm growth, operational results, and profits may be constrained. Notably, our revenue heavily relies on construction projects related to our Group Companies and promoters being 100.00%, 44.82%, 94.62% and86.65% in stub period ended April 30, 2024, March 31, 2024, March 31, 2023 and March 31, 2022 respectively.

3. The construction industry is cyclical and sensitive to changes in the economy and this could have a significant impact on our operations and financial results.

4. One of our Promoter- Mr. Pravin Kumar Brijendra Kumar Agarwal is involved in a criminal proceeding initiated by Airport Police Station which is currently pending before the Hon'ble Metropolitan Magistrate at Andheri, Mumbai. Any such proceedings, or any adverse action as a result of such proceedings, may affect the reputation of our promoter and subsequently that of our business.

5. Our Company had negative cash flow in recent fiscals, details of which are given below. Sustained negative cash flow could adversely impact our business, financial condition and results of operations.

6. The previous IPO filed by our promoter group PKH Venture Limited was not subscribed leading to withdrawal of the IPO.

7. Our business and profitability are significantly dependent on the performance of the real estate market generally in India and particularly in the Mumbai Metropolitan Region ("MMR"). Varying market conditions in the MMR may affect our ability to ensure sale of our projects and the pricing of units in such projects, which may adversely affect our results of operations and financial condition.

8. Our contracts are mostly of the nature of EPC contracts and we are exposed to inherent risks related to our contractual framework.

9. We enter into various sub-contract agreements with primary contractors for construction projects. Such agreements contain conditions and requirements, the non-fulfilment of which could result in delays and we may be required to indemnify and compensate them.

10. Delaysin obtaining a requisite approvals or statutory clearances may lead to challenges and could adversely impact profitability and future projects like as happened with our "Trinity Oasis" project situated at Ghodbunder Road, Thane.