22.

condition or reputation, irrespective of the amount involved in such litigation. The summary of the
outstanding litigations involving the aforementioned persons/entities are as follows:

 

Type of Litigation ‘Number of cases ‘Amount*
(in million)
Litigation involving our Company
Material civil litigation 2 15.07
Actions by statutory or regulatory authorities 2 7.62
Direct and indirect tax proceedings 24 193.28
Total 28 215.97
Litigation involving our Directors
Actions by statutory or regulatory authorities 1. 0.10
Total 1 0.10

 

*to the extent quantifiable

Involvement in such proceedings could divert our management’s time and attention, and consume
financial resources. Further, an adverse judgment in these proceedings could have an adverse impact on
our business, results of operations and financial condition. See “Outstanding Litigation and Other
Material Developments” on page 325.

We cannot assure you that any of such proceedings will be settled in our favour or in favour of our
Company or Directors, as applicable, or that no additional liability will arise out of these proceedings.

If we are unable to accurately forecast demand for our products and plan production schedules in
advance, our business, cash flows, financial condition, results of operations, and prospects may be
adversely affected.

Our inability to forecast the level of customer demand for our products, process innovation, and value
engineering costs as well as our inability to accurately schedule our raw material purchases and
production and manage our inventory may adversely affect our business and cash flows from operations.
In particular, our inability to accurately forecast demand for products in our emerging product segments
such as storage solutions and material handling may hinder our planned growth in these segments.

For some of our customers, we have long term purchase agreements, which define the terms and
conditions of purchases by the customers. These are supplemented by specific open purchase orders
which do not have any validity in respect of time period and only specify the price at which the products
are to be supplied with no mention of any specific quantity. The quantities supplied are typically based
on monthly delivery schedules provided by the customers based on their own demand and supply
situation. Further, for our long term contracts, there is a term for product life cycle, which in turn may
be phased out or halted. Although our customers provide us with forecasts of annual business volumes,
which enable us to predict our income for a portion of our business, the actual orders are only placed by
way of on-going purchase orders. Product quantities are typically based on delivery schedules received
from the customers in short intervals and multiple times in a day, in certain cases. Our customers do not
provide a firm commitment for any specific product quantity and purchase orders may be amended or
cancelled prior to finalization, as a result of which, we do not hold a significant order book at any time,
making it difficult for us to forecast revenue, production or sales and plan our inventory in advance.

Actual production volumes may vary from these estimates due to variations in consumer demand for the
related vehicles leading to underutilized capacity or incurring additional expenditure to deploy additional
resources to meet delivery timelines. In addition, in the event of significant cuts in production schedules
announced by customers with little advance notice, we may be unable to respond with corresponding
production and inventory reductions. Significant reduction in demand for our products from a major
customer may have an adverse effect on our business, financial condition, results of operations, and
prospects. While some of our customers share annual forecasts with us, we do not have any recourse
against our customers in the event of a reduction in the forecasted volume. Further, we have certain
manufacturing facilities which are either dedicated, or predominantly catering to some of our OEM
customers and are in such localities to serve such customers efficiently. Any reduction in forecasted
volume from customers for whom we run dedicated facilities, would materially and adversely affect our
business, results of operations and financial condition.

32
