Shreedhar Spinners Ltd.

• Funding incremental working capital requirements of our Company₹21.0 Cr
• Purchase of machineries into existing manufacturing facility at Amravati, Maharashtra₹4.9 Cr
• General corporate purposes₹1.6 Cr

As on the date of this Prospectus, there are no outstanding criminal proceedings, actions by statutory or regulatory authorities, or claims related to direct or indirect tax liabilities involving the Company, its Directors, Promoters, or Subsidiary. There are also no disciplinary actions by SEBI or stock exchanges against Promoters in the last five Financial Years, and no outstanding criminal proceedings, actions by authorities, or pending litigation involving Key Managerial Personnel, Senior Management, or Group Companies.

• A significant portion of the promoter's equity shares (48.88%) are pledged with SBICAP Trustee Company Limited. In the event of a default by the promoter, the lender may invoke the pledge, leading to a change in shareholding pattern, dilution of promoter control, and a decline in the market price of the Equity Shares.(Corporate Governance / Shareholding)

• The Company has a high debt-equity ratio (3.89 in Fiscal 2026) and financing agreements contain restrictive covenants. Inability to meet obligations or financial covenants could adversely affect the business, results of operations, and financial condition, potentially forcing the issuance of additional equity to lenders.(Financial / Debt)

• The Company has a history of related party transactions, constituting 8.64% of revenue in Fiscal 2026, 18.61% in Fiscal 2025, and 43.68% in Fiscal 2024. There is no assurance that such transactions will not have an adverse effect on the financial condition and results of operations.(Related Party Transactions)

• The Company's business is dependent on its operating facility in Amravati. The loss or shutdown of this facility due to equipment failure, power supply issues, labour disputes, strikes, or industrial accidents could have a material adverse effect on the business, financial condition, and results of operations.(Operational / Facility)

• A substantial portion of the Company's revenue (90.20% in Fiscal 2026) is generated from Maharashtra. Any adverse developments in the state, such as regulatory changes, new levies, logistics disruptions, or natural calamities, could materially disrupt business activities and supply chains.(Geographic Concentration)

• The Company is heavily reliant on floor workers hired on a daily wage/per piece basis who are not on a fixed payroll. Any inability to procure these services or disputes with this group of labour could severely affect operations and cause under-utilisation of capacities or a total shutdown.(Operational / Labour)

• The Company's operations involve a significant degree of integration, making results of operations dependent on the successful operation of each facility. Any disruption of operations at the facilities, even if not previously experienced, may adversely affect the business, financial condition, results of operations, and prospects.(Operational / Integration)

• The Company is subject to operating risks such as obsolescence of equipment, performance below expected levels, and the need to comply with directives and regulations from the Government of India and relevant state government authorities.(Regulatory / Operational)