Garuda Construction and Engineering Ltd IPO

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

As a construction company, its limited experience in dealing with unrelated third-party entities presents challenges for its growth. If the company cannot establish ourselves successfully as developers or contractors beyond its promoter group and associated companies, the company longterm growth, operational results, and profits may be constrained. Notably, its revenue heavily relies on construction projects related to its 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.

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

One of its 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 its promoter and subsequently that of the company's business.

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

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

Its 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 its ability to ensure sale of the company projects and the pricing of units in such projects, which may adversely affect its results of operations and financial condition.

Its contracts are mostly of the nature of EPC contracts and the company is exposed to inherent risks related to its contractual framework.

The company 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 its may be required to indemnify and compensate them.

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