Prostarm Info

Experienced Promoters and Management team.

Well established infrastructure with technologies

Wide geographical presence and distribution network

Scalable business model with wide portfolio of clients across various industries.

We believe that our diversified product portfolio helps us retain our customers and strengthen our cross-selling efforts across product portfolios

Existing relationship with clients.

Wide array of quality products and services.

The Company has received a show cause notice for alleged violation under the Custom Act, 1962. Any adverse order passed against the company would materially affect its financial condition and business.

The company revenue from operations is dependent upon a limited number of customers and the loss of any of these customers or loss of revenue from any of these customers could have a material adverse effect on its business, financial condition, results of operations and cash flows.

Disruption in its relationships with third party dealers and distributors, changes in their business practices, their failures to meet payment schedules and provide timely and accurate information could adversely affect its business, operating cash flows and financial condition.

The company is heavily dependent on its suppliers and any disruptions in the supply or an increase in prices of materials and components could adversely affect its operations.

The company has received show cause notices from regulatory authorities in the past.

The company has experienced negative operating cash flows of Rs.1350.31 lakhs, Rs.780.18 lakhs and Rs.1,053.45 lakhs in prior years Fiscal 2023, Fiscal 2024 and in the nine month period ended December 31, 2024, respectively.

The company has derived a substantial portion of its revenue from the sale of its UPS System and sale of third party power solution products and other products and loss of sales due to reduction in demand for these products would have a material adverse effect on its business, financial condition, results of operations and cash flows.

The Company, Promoters, Directors, Subsidiary, KMPs and SMPs 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.

Under-utilization of its manufacturing capacities and an inability to effectively utilize the company manufacturing capacities could have an adverse effect on its business, future prospects and future financial performance.

The company has contingent liabilities and its financial condition could be adversely affected if any of these contingent liabilities materializes.

Its ability to manufacture lithium battery packs may be adversely affected due to various reasons including restriction on import of lithium-ion cells, change in regulatory landscape, tariff increase etc.

Its ability to manufacture lithium battery packs may be adversely affected due to various reasons including restriction on import of lithium-ion cells, change in regulatory landscape, tariff increase etc.

Its manufacturing units are located in the state of Maharashtra, India, which exposes the company operations to potential geographical concentration risks arising from local and regional factors which may adversely affect its operations and in turn its business, results of operations and cash flows.

The company has a limited operating history in manufacturing.

In the past its Directors were subject to disqualification and default.

The loss of accreditation for its manufacturing unit and operations and the company empanelment with government institutions could damage its reputation, business, results of operations and cash flows.

The company derives a portion of its revenue from government institutions. In the event the company is unable to secure such orders/projects, its business, results of operations and financial condition may be adversely affected.

The company is subject to restrictive covenants under its financing agreements that could limit its flexibility in managing the company business or to use cash or other assets. Any defaults could lead to acceleration of its repayment obligations, cross defaults under other financing agreements, termination of one or more of its financing agreements or force us to sell its assets, which may adversely affect its cash flows, business, results of operations and financial condition.

Objects of the Issue for which the funds are being raised have not been appraised by any bank or financial institutions. Any variation in the utilization of the Net Proceeds as disclosed in this Red Herring Prospectus would be subject to certain compliance requirements, including prior shareholders` approval.

The company derives majority of Solar EPC contracts are through tender/bidding process, and its may not be able to qualify for, compete or win such projects, which could adversely affect its business prospects, cash flows and results of operations.

The company does not own some of the premises from where the company operates.

The company faces competition in relation to its offerings, including from competitors that may have greater financial and marketing resources. Failures to compete effectively may have an adverse impact on its business, financial condition, results of operations and prospects.

In addition to its assembling and manufacturing the company products, its enter into arrangement with third- party contract manufacturers including on job work basis and therefore, the company is subject to risks associated with the third-party manufacturing processes.

The company has significant working capital requirements and its inability to meet such working capital requirements may have an adverse effect on its results of operations.

The company has significant working capital requirements and its inability to meet such working capital requirements may have an adverse effect on its results of operations.

The company requires certain approvals and licenses in the ordinary course of business and are required to comply with certain rules and regulations to operate its business, any failures to obtain, retain and renew such approvals and licences or comply with such rules and regulations may adversely affect its operations.

Continued operations at its manufacturing units are critical to the company business and any disruption in its manufacturing units would have a material adverse effect on its business, results of operations and financial condition.

The company is exposed to credit risk from its customers and the recoverability of the company trade receivables is subject to uncertainties.

The Company intends to utilise a portion of the Net Proceeds of the Issue towards the working capital requirements of the Company which are based on certain assumptions and estimates and have not been appraised by any bank or financial institution.

The company is dependent on third-party transportation providers for the supply of materials for its manufacturing process and delivery of the company finished products.

Unsatisfactory performance of or defects in its products may cause it to incur additional expenses and warranty costs, damage its reputation and cause the company sales to decline.

Failures to maintain the confidentiality of its technical knowledge could undermine its competitive advantage.

Growing its business through acquisitions may expose it to additional risks that could adversely impact its business, financial condition, cash flows, operational results, and future prospects.

The company has in the past entered into a number of related party transactions and may continue to enter into related party transactions in the future on an arm`s length basis, and there can be no assurance that the company could not have achieved more favourable terms if such transactions had not been entered into with related parties.

Its lenders have charge over the company movable and immovable properties in respect of finance availed by it.

There are certain instances of delays in payment of statutory dues. Any delay in payment of statutory dues or non-payment of statutory dues in dispute may attract financial penalties from the respective government authorities, which may have an adverse impact on its financial condition and cash flows.

Exchange rate fluctuations may adversely affect its business, results of operations and cash flows.

Its may not be able to adequately protect the company intellectual property, which could harm the value of its brand and services.

Its Promoters have provided personal guarantees as security for certain facilities availed by the Company. If these guarantees are revoked, its may be unable to procure alternative guarantees satisfactory to its lenders, which may adversely affect its business, results of operations, cash flows and financial condition.

Its insurance policies may not be adequate to cover all losses incurred in the company business. An inability to maintain adequate insurance cover to protect it from material adverse incidents in connection with its business may adversely affect its operations and profitability.

There may have been certain instances of irregularities, discrepancies and non-compliances with respect to certain corporate actions taken by the Company in the past. Consequently, its may be subject to regulatory actions and penalties.

An inability to effectively manage its growth and expansion may have a material adverse effect on its business prospects and future financial performance.

Inability to meet the quality standard norms prescribed by applicable regulatory authorities could result in the sales of its products being banned or suspended or becoming subject to significant compliance costs, which could have a material adverse effect on its business, results of operations and cash flows.

If the company is unable to establish and maintain effective internal controls and compliance system, its business and reputation could be adversely affected.

Its growth strategy to enter international markets exposes it to certain risks, which may adversely affect its business, financial condition, results of operations and prospects.

Certain sections of this Red Herring Prospectus disclose information from the CARE Report which has been commissioned and paid for by it exclusively in connection with the Issue and any reliance on such information for making an investment decision in the Issue is subject to inherent risks.

None of the Directors of the Company have experience of being a director of a public listed company.

Its may be unable to attract and retain employees with the requisite skills, expertise and experience, which would adversely affect its operations, business growth and financial results.

Its funding requirements and the proposed deployment of Net Proceeds have not been appraised by any bank or financial institution or any other independent agency and its management will have broad discretion over the use of the Net Proceeds.

Activities involving its assembling and manufacturing process can be dangerous and can cause injury to people or property in certain circumstances. A significant disruption at any of its manufacturing units may adversely affect its production schedules, costs, revenue and ability to meet customer demand.

The company is dependent on its Promoters for functioning of its business and the company believe that its senior management team and other key managerial personnel in its business units are critical to its continued success and the company may be unable to attract and retain such personnel in the future.

The company relies on contract manpower for carrying out certain of its operations and we may be held responsible for paying the salary of such manpower, if the independent contractors through whom such manpower are hired default on their obligations, and such obligations could have an adverse effect on its results of operations and financial condition.

Changes in technology may affect its business by making its manufacturing unit or equipment less competitive or obsolete.

Its operations are significantly dependent on the company ability to successfully identify market requirements and customer preferences and gain customer acceptance for its products.

Its operations may be materially adversely affected by strikes, work stoppages or increased compensation demands by its employees.

The Company`s Directors or Promoters may enter into ventures that may lead to real or potential conflicts of interest with its business.

Failures or disruption of its information and technology ("IT") and/ or enterprise resources planning systems may adversely affect its business, financial condition, results of operations and future prospects.

Its Promoters and members of the Promoter Group will continue jointly to retain majority control over the Company after the Issue, which will allow them to determine the outcome of matters submitted to shareholders for approval.

The Company has issued Equity Shares by way of a bonus issue in the past. Its cannot assure you that the company will not issue Equity Shares in the future at a price lower than the Issue Price.

Its future funds requirements, in the form of issue of capital or securities and/or loans taken by it, may be prejudicial to the interest of the shareholders depending upon the terms on which they are eventually raised.

Its ability to pay dividends in the future will depends upon its future earnings, financial condition, cash flows, working capital requirements, capital expenditure and restrictive covenants in its financing arrangements.

Its Promoters, some of the company Directors and some of its KMPs and SMPs are interested in the Company, in addition to regular remuneration or benefits and reimbursement of expenses.

Information relating to the installed manufacturing capacity of its Manufacturing Units included in this Red Herring Prospectus are based on various assumptions and estimates and future production and capacity may vary.

The company could be harmed by employee misconduct or errors that are difficult to detect and any such incidences could adversely affect its financial condition, results of operations and reputation.

Any future issuance of Equity Shares, or convertible securities or other equity linked securities by the Company may dilute your shareholding and any sale of Equity Shares by its Promoters or members of its Promoter Group may adversely affect the trading price of the Equity Shares.

Rights of shareholders under Indian laws may be more limited than under the laws of other jurisdictions.

QIB and Non-Institutional Investors are not permitted to withdraw or lower their Bids (in terms of quantity of Equity Shares or the Bid Amount) at any stage after submitting a Bid.

The company has in this Red Herring Prospectus included certain non-GAAP financial measures and certain other industry measures related to its operations and financial performance. These non-GAAP measures and industry measures may vary from any standard methodology that is applicable across the industry, and therefore may not be comparable with financial or industry related statistical information of similar nomenclature computed and presented by other companies.

Subsequent to the listing of the Equity Shares, its may be subject to surveillance measures, such as the Additional Surveillance Measures and the Graded Surveillance Measures by the Stock Exchanges in order to enhance the integrity of the market and safeguard the interest of investors.

The Equity Shares have never been publicly traded, and, after the Issue, the Equity Shares may experience price and volume fluctuations, and an active trading market for the Equity Shares may not develop. Further, the price of the Equity Shares may be volatile, and you may be unable to resell the Equity Shares at or above the Issue Price, or at all.

The Issue price of its Equity Shares may not be indicative of the market price of its Equity Shares after the Issue and the market price of its Equity Shares may decline below the Issue Price and you may not be able to sell your Equity Shares at or above the Issue Price.

Fluctuation in the exchange rate between the Indian Rupee and foreign currencies may have an adverse effect on the value of our Equity Shares, independent of our operating results.