Grace Renewable Energy Limited

• Funding of incremental working capital requirement of our Company₹79.3 Cr
• General Corporate Purposes

Except as disclosed in this section, as on the date of this Draft Red Herring Prospectus, there are no outstanding criminal proceedings, actions by regulatory authorities, claims related to direct and indirect tax matters, or other pending litigation involving the Company, Directors, Promoters, Key Managerial Personnel, or members of Senior Management. There are also no disciplinary actions or penalties imposed by SEBI or stock exchanges against Promoters in the last five Financial Years.

• Our operations and revenues are concentrated predominantly in the state of Gujarat. Any adverse economic, political, regulatory, environmental or infrastructural developments in Gujarat may materially and adversely affect our business, financial condition, results of operations, cash flows and growth prospects.(Geographic Concentration)

• In Fiscals 2026, 2025 and 2024, we derived 88.97%, 88.07% and 85.81% of our purchases, respectively from our top 10 suppliers. A significant portion of our purchases may be concentrated among a limited number of suppliers, and any disruption in our relationship with such suppliers or their inability to supply critical components may adversely affect our business and results of operations.(Supplier Concentration)

• Our Trading vertical contributed ₹1,126.93 million, ₹727.86 million and ₹238.33 million, representing 54.75%, 60.40% and 30.59% of our revenue from operations, in Fiscal 2026, Fiscal 2025 and Fiscal 2024, respectively. Any decline in demand for the products traded by us or disruption in our arrangements with manufacturers could adversely affect our business, financial condition, cash flows and results of operations.(Business Model Risk)

• Our BESS manufacturing operations require imported lithium-ion cells and other critical components sourced from international suppliers located in China. Any failure by our significant suppliers to fulfil orders, deterioration in their financial or operational condition, production disruptions, quality issues, capacity constraints or changes in their commercial terms may adversely affect the availability or cost of the products and components required by us.(Supply Chain Risk)

• We may incur additional costs or experience delays if we are required to procure such products or components from alternative suppliers. Any inability to obtain critical components in adequate quantities and within the required timelines could delay our manufacturing and project execution, affect our ability to meet customer commitments and adversely affect our business, financial condition, cash flows and results of operations.(Supply Chain Risk)

• Our operations in Gujarat may also be affected by the availability and cost of land, labour, utilities and other resources, adequacy of road, power, transmission and other infrastructure, availability of grid connectivity and evacuation infrastructure, transportation and logistics constraints, and delays in obtaining or maintaining applicable approvals, permissions and clearances.(Operational Risk)

• Further, adverse climatic, environmental or other conditions in Gujarat may disrupt our project execution and manufacturing operations, damage our facilities or inventory, or result in increased operating or project costs.(Operational Risk)

• Although we have undertaken Solar EPC projects in other states such as Maharashtra, Madhya Pradesh, Karnataka, Delhi, Dadra & Nagar Haveli, Rajasthan, Haryana, Uttar Pradesh, West Bengal, Tamil Nadu & Andhra Pradesh and intend to expand our geographical presence, there can be no assurance that we will be able to diversify our operations or revenues to the extent or within the timelines contemplated by us.(Geographic Concentration)