For further information, see “Outstanding Litigation and Other Material Developments” beginning on page 343.

There can be no assurance that these legal proceedings will be decided in our favor or in favor of our Company.
In addition, we cannot assure you that no additional liability will arise out of these proceedings. Decisions in such
proceedings adverse to our interests may have an adverse effect on our business, results of operations and financial
condition. For further information on contingent liabilities, see “- We have certain contingent liabilities that have
not been provided for in our financial statements, which if they materialize, may adversely affect our financial
condition.” on page 46.

15. If we are unable to identify customer demand accurately and maintain an optimal level of inventory, our
business, results of operations and financial condition may be adversely affected.

The success of our business depends upon our ability to anticipate and forecast customer demand and trends. Any
error in our forecast could result in either surplus stock, which we may be unable to sell in a timely manner, or at
all, or under-stocking, which will affect our ability to meet customer demand. We plan our inventory and
commence our design process prior to launch and estimate our sales based on the forecast, demand and
requirements for the forthcoming seasons. We have inventory manufactured and stored at our warehouse ahead
of an upcoming season. An optimal level of inventory is important to our business as it allows us to respond to
customer demand effectively and to maintain a full range of products at our EBOs and for sale through our other
retail channels. As of March 31, 2019, 2020 and 2021 and as of June 30, 2020 and June 30, 2021, our inventory
as a percentage of our current assets was 35.58%, 46.39%, 32.61%, 49.64% and 45.35% respectively, while our
inventory as a percentage of our revenue from operations was 24.36%, 27.00%, 32.29%, 1048.14% and 331.29%
respectively. Our inventory cycle (i.e., inventory turnover days) were 89 days, 99 days, 118 days, 954 days and
301 days in Fiscal 2019, 2020 and 2021 and in the three months ended June 30, 2020 and June 30, 2021,
respectively. Ensuring availability of our products requires prompt turnaround time and a high level of
coordination amongst raw material procurement teams, manufacturers, warehouse management and retail stores
and staff. While we aim to avoid under-stocking and over-stocking, our estimates and forecasts may not always
be accurate. If we fail to accurately forecast customer demand, we may experience excess inventory levels or a
shortage of products available for sale. If we under-stock inventory, our ability to meet customer demand may
be impaired. If we over-stock inventory, our capital requirements may increase and we may incur additional
financing costs. Any unsold inventory may have to be sold at a discount or discarded, potentially leading to
losses. We cannot assure you that we will be able to sell surplus stock in a timely manner, or at all, which in
turn may adversely affect our business, results of operations and financial condition.

16. Quality and consistency in customer service at our stores are critical for our success, which depend on our
ability to attract and retain skilled personnel. Any failure in this respect could materially and adversely
impact our reputation, business, financial condition, cash flows and results of operations.

Our business is manpower intensive and the success of our business depends on maintaining high standards of
customer service in our stores. This is dependent on our ability to attract, hire, train, and retain skilled personnel
particularly for design and sales functions, monitor them continuously on key service parameters and guide them
regularly. We had 2,855 employees as of September 30, 2021, including 10 employees in our design team, and
2,517 employees who are front-end staff at our EBOs and LFSs. We rely on our design team comprising of skilled
designers and craftsmen both for textile and fabric design as well as for clothes styling. Further, in the retail
industry, the level and quality of sales personnel and customer service are key competitive factors. As we seek to
offer new products and designs and expand our retail network, we need experienced manpower that has relevant
knowledge of our target customers and of the local market and the retail industry to operate our stores,
respectively.

Across our operations, we experienced attrition of 6.82% for Fiscal 2019, 5.69% for Fiscal 2020,4.27% for Fiscal
2021, 2.54% for the three months ended June 30, 2020 and 3.84% for the three months ended June 30, 2021. We
may not always be able to retain our personnel or find and hire personnel with the necessary experience or
expertise. We may need to increase compensation and other benefits in order to attract and retain personnel in the
future and that may affect our costs and profitability. There can be no assurance that we will be able to recruit and
retain the right personnel and functional experts or will be successful in delivering consistent services. If customer
service at our stores deteriorates, our reputation might suffer resulting in a decrease in sales, which could
materially and adversely affect our financial condition, cash flows and results of operations.

17. We do not currently own any manufacturing facilities and engage job workers for manufacturing all our
products. We may not be able to obtain sufficient quantities or desired quality of products from job workers

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