CLN Energy Ltd IPO

The Company, Group Companies, Promoters and Directors are parties to certain legal proceedings. Any adverse decision in such proceedings may have a material adverse effect on its business, results of operations and financial condition.

The company derives a significant portion of its revenue from the sale of batteries, cells and motor and controller and any reduction in demand or in the manufacturing of such products could have an adverse effect on its business, results of operations and financial condition.

The company has not entered into any agreement with the suppliers of machinery and equipment as specified in the objects of the Issue. Further the amount allocated for purchases of machinery and equipment are based on the quotation received from suppliers.

The company has reported negative net cash flows in the past and may do so in the future.

The company is dependent on a few suppliers for supply of raw materials and any major disruption to the timely and adequate supplies of its raw materials could adversely affect the company business, results of operations and financial condition.

The company business of manufacturing and supply of lithium-ion batteries, motors and powertrain components, and services required by electric vehicle industry, commercial and industrial application, solar industry, telecom industry etc is significantly dependent on the technology, process and product development of its products.

The Company has in the past experienced a major fire at its Manufacturing Facility cum Registered Office which resulted in major losses for the Company. Hence its past performance may not be comparable with the company future performance.

The company is significantly dependent on few customers for its revenue in a particular financial year. The loss of any one or more of such customers may have a material effect on its business operations and profitability.

Trade Receivables, Inventories and other current assets form a substantial part of its Total Assets. Failures to manage the company trade receivables and inventories could have an adverse effect on its net sales, profitability, cash flow and liquidity.

In addition to normal remuneration its Key Management Personnel (including the company promoters) are interested in the Company to the extent of their shareholding and dividend entitlement in the Company. Further the company has entered in related party transaction with them.