9 months after raising Rs 50 cr, firm to pursue legal action to recover Rs 8.16 cr vendor payment

The filing stated, "We made the advance payment of AED 35,99,048 to the Company named Regans International DMCC for import of chemicals but even after the passage of six months, the company Sudarshan Pharma Industries Limited was unable to receive the material."

It added, "As required by the RBI rules we are taking necessary legal recourse. We are in the process of either obtaining the material or demanding the refund of the advance payment."

One of the risk factors mentioned in its red-herring prospectus was its vendor agreements, which are not long-term agreements.

The prospectus read, "Our business may be adversely affected if there is any disruption in the trading material supply or due to non-availability of trading material. We do not have written agreements with our vendors/suppliers and we operate on a purchase order system. There are no long-term supply agreements for the trading material. In the absence of any such formal contract with our vendors/suppliers, we are exposed to the risks of irregular supplies or no supplies at all or delayed supplies or price variation which would materially affect our results of operations."

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It added, "In the event of any disruption in the supply or the nonavailability of material in the required quantity and of required quality from an alternate source, the supply schedule to our clients may be adversely affected impacting the sales and profitability of the company."

The company had previously attempted listing in 2019 on the Emerge Platform of the National Stock Exchange, but it had pulled out on the last day of subscription "due to material changes in the current business model and future expansion plan".