Paramatrix Tech.

Risks

• The Company, Promoters, and Directors are involved in certain legal proceedings and potential litigations. Any adverse decision in such proceedings may render it/them liable to liabilities/penalties which may adversely affect its business, financial condition and results of operations.

• If the company is unable to implement its growth strategy successfully, its results of operations and financial condition may be adversely affected.

• The success of its business and operational outcomes relies on the contracts we establish with its customers. Any violation of the terms within these contracts could have a negative impact on its business and operational results.

• Though, the company has entered into contracts/ master service agreements with its customers, its new business with them is on the basis of purchase orders for their new requirements, any loss of such customers could adversely impact its revenues and profitability.

• Its business operations are subject to high working capital requirements. Its inability to maintain an optimal level of working capital required for the company`s business may impact its operations adversely.

• The process of product development is expensive, time-consuming, and uncertain.

• Failures to adapt to evolving customer needs and to embrace & develop new technologies could have detrimental effects on its business, financial standing, and operational results.

• Undiscovered software design defects, errors, or failures may lead to a loss of or delay in the market acceptance of its products and services or give rise to liabilities that could significantly and adversely impact its business, financial health, and operational outcomes.

• Its Promoters and Directors, Mukesh Keshubhai Thumar and Bhavna Mukesh Thumar plays key role in its functioning and the company heavily relies on their knowledge and experience in operating its business and therefore, it is critical for the company`s business that its Promoters/ directors remain associated with it. The company`s success also depends on its key managerial personnel and its ability to attract and retain them. Any loss of the company key person could adversely affect its business, operations and financial condition.

• The company avail the services of specific consultants for certain operations. Any inadequacy or disruption in their services could have adverse effects on its business operations and reputation.

• Inability to safeguard its intellectual property may impair the company capacity to compete successfully.

• Inability to uphold the confidentiality of its customers` information may have negative repercussions on its reputation, business, financial standing, and operational outcomes.

• Its business requires the company to obtain and renew certain registrations, licenses and permits from government and regulatory authorities and the failure to obtain and renew them in a timely manner may adversely affect its business operations.

• Its global operations expose the company to a multitude of legal and regulatory requirements, some of which may conflict, and any infringement of these regulations could adversely affect its business.

• Because the company operates in a highly competitive industry, its revenues, profits or market share could be harmed if the company is unable to compete effectively.

• Employee misconduct, errors or fraud could expose it to business risks or losses that could adversely affect its business prospects, results of operations and financial condition.

• The company encounter risks related to the fluctuations in currency exchange rates.

• Data networks are susceptible to attacks, unauthorized access, and disruptions. Any losses or liabilities arising from these factors could significantly and negatively impact its business, financial condition, and operational results.

• Failures to align with technological advancements or industry trends may impact the performance and features of its products and services, diminishing the company`s appeal to customers.

• Its business is geographically located in India and overseas. Any loss or shutdown of operations at any of its facilities in this areas may have an adverse effect on the company`s business and results of operations.

• The Company had negative cash flow from operating activity in recent fiscals, details of which are given below.

• Its financing agreements contain covenants that limit the company`s flexibility in operating its business. Its inability to meet the company`s obligations, including financial and other covenants under its debt financing arrangements could adversely affect the company business, results of operations and financial condition.

• The company has not made any alternate arrangements for meeting its capital requirements for the Objects of the Offer. Further the company has not identified any alternate source of financing the `objects of the Offer`. Any shortfall in raising/ meeting the same could adversely affect its growth plans, operations, and financial performance.

• The company does not fully own its Registered Office and corporate office from which the company operates.

• Its results of operations are likely to vary from year to year and be unpredictable, which could cause the market price of the Equity Shares to be volatile.

• The company has in the past entered into related party transactions and may continue to do so in the future, which may potentially involve conflicts of interest with the equity shareholders.

• Any variation in the utilization of the Net Proceeds as disclosed in this Draft Prospectus shall be subject to certain compliance requirements, including prior Shareholders` approval.

• Its funding requirements and deployment of the Offer Proceeds are based on management estimates and have not been independently appraised by any bank or financial institution.

• The Company`s management will have flexibility in utilizing the Net Proceeds. There is no monitoring agency appointed by the Company and the deployment of funds is at the discretion of its Management and its Board of Directors, though it shall be monitored by its Audit Committee.

• The company has made dividend payments in the past and its ability to pay dividends in the future will depends upon future earnings, financial condition, cash flows, working capital requirements, capital expenditures and restrictive covenants in its financing arrangements.

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

• Its insurance coverage may not adequately protect the company against all material hazards and the policies does not cover all risks. In the event of the occurrence of such events, its insurance coverage may not adequately protect the company against possible risk of loss.

• The Company will not receive any proceeds from the Offer for Sale portion.

• The requirements of being a listed company may strain its resources.

• The company propose to utilize a portion of its Net Proceeds towards setting up of development center. Any delay or failures in successfully setting up of development center may affect its business growth, thereby affecting its future business plans, business operations and financial conditions.

• The company propose to utilize a portion of its Net Proceeds towards designing, development, implementation, and maintenance across all the company accelerators. Any delay or failures in successfully implementing the same, may affect business growth prospects, thereby affecting its future business plans, the company operational efficiency and financial conditions.

• The company propose to utilize a portion of its Net Proceeds towards expanding the company`s business operation in Middle East and East Asia. Any delay or failures in successfully expanding its business operations in said locations may affect business growth prospects, thereby affecting its future business plans, the company operational efficiency and financial conditions.

• There have been several instances of delay in payment of EPF dues by the Company in the past.