Ardee Engineering Limited IPO

A majority of our revenue from operations is from our top 5 customers (which accounted for more than 60% of our total revenue from operations in the six months ended September 30, 2024, Fiscal 2024, Fiscal 2023 and Fiscal 2022). Loss of any such customers or reduction in business or demand from such customers will have a significant adverse impact on our business and results of operation.

We depend on our PEB vertical for a significant portion of our revenues (50.20%, 50.11%, 40.87% and 71.78% of our revenue from operations in the six months ended September 30, 2024, Fiscal 2024, Fiscal 2023 and Fiscal 2022). Our inability to effectively supervise projects under our PEB vertical may lead to project delays which may adversely affect our business, results of operations, financial condition and cash flows.

We rely on the availability of steel and other raw materials, as well as third-party suppliers and manufacturers, for the uninterrupted supply of raw materials. We do not have continuing or exclusive arrangements with any supplier, and our top 10 suppliers contribute to more than 50% of our total raw material and supply costs. The loss of key suppliers or delays in raw material deliveries could adversely impact our business, financial condition, results of operations, and cash flows.

We have significant working capital requirements and if we experience insufficient cash flows or are unable to access suitable financing to meet working capital requirements, our business, financial condition and results of operations could be adversely affected.

Our business is dependent and will continue to depend on our Manufacturing Units situated in Andhra Pradesh and Telangana, which exposes us to regional risks and risks in relation to our manufacturing process. Any disruption, slowdown, or shutdown in our manufacturing operations could adversely affect our business, results of operations, financial condition and cash flows.

Our proposed under-construction facilities in Seetharampur, Telangana are constructed on land allotted by Telangana Industrial Infrastructure Corporation. Our inability to comply with conditions of the lease agreements may result in forfeiture of the land, which may have an adverse impact on our business, results of operations, financial condition and cash flows.

The equipment quotations received for procurement using Net Proceeds are valid as of this Draft Red Herring Prospectus. However, without definitive vendor agreements, pricing and availability remain uncertain. Any cost variations or vendor changes may lead to time and cost overruns, impacting our business, financial condition, and cash flow.

We have been earlier refused registration of our trademark "Ardee". Our inability to protect or use the "Ardee" brand name and trademark exclusively may adversely affect our business. We may also unintentionally infringe upon the intellectual property rights of others, any misappropriation of which could harm our competitive position.

We derive a significant portion of our revenues from repeat orders from our customers or entities belonging to the same corporate group. Any loss of, or a significant reduction in the repeat orders received by us could adversely affect our business, results of operations, financial condition and cash flows.

Our actual cost incurred in completing a project may vary substantially from the assumptions underlying our bid. We may be unable to recover all or some of the additional expenses incurred, which could adversely affect our financial condition, results of operation and cash flows.