gayatri projects limited - Edelweiss

meet these pre-qualifications, we enter into joint ventures / memorandum of understanding with othercompanies. In case we are unable to forge an alliance with other companies to meet the prequalificationrequirements we may lose out on the opportunity to bid.Where we have formed the joint venture and being awarded the project the credit for the project will be thatof joint venture. Our Company can claim credit to the extent of its share in the joint venture as is agreedto upfront in the Joint Venture Agreement. However, since the liability of the joint venture partners is jointand several, implying thereby that in case the joint venture partner fails to discharge his obligation underthe contract, our Company is liable to get the entire contract performed to the satisfaction of the client.29. Our operations may be affected by adverse weather conditions.The timely completion of the projects we undertake is also dependent upon the weather conditions. Anyadverse weather condition could delay implementation of the projects resulting in a delay in the execution ofour contractual obligations thereby affecting our business.30. Our exposure to interest rates may adversely affect our financial performance.We are availing term loan & working capital facilities to the extent of Rs. 16426.78 lakhs as on August 22,2006 and our borrowings are linked to prime lending rate of banks / institutions. Any adverse movements ininterest rates may adversely affect our results of operations and financial condition.31. Our inability to retain and attract key managerial personals could adversely affect our business.Our ability to meet future business challenges depends on our ability to attract and recuit talented andskilled personnel. A numbers of our employees are skilled, qualified and experienced in our line of business,and we may face competition to recruit and retain these manpower. Our future performance will dependupon the continued services of these personnel. The loss of any of the members of our senior management,our directors or other key personnel or an inability to manage the attrition levels in different employeecategories may materially and adversely impact our business and results of operations.32. Our results of operations could be adversely affected by any disputes with our employees.We also employ contract labour and the number of contract labourers may vary from time to time based onthe nature and extent of work contracted to independent contractors. We enter into contracts with independentcontractors to complete specified assignments. Any non-compliance by the contractors in respect of applicablelabour laws may hamper the business of our Company. All contract labourers engaged at our facilities areassured minimum wages that are fixed by local government authorities. Any upward revision of wagesrequired by such governments to be paid to such contract labourers, or offer of permanent employment orthe unavailability of the required number of contract labourers, may adversely affect our business andresults of our operations.33. Promoter group will continue to retain majority control in the company after the Offer, which willenable them to influence the outcome of matters submitted to shareholders for approval. We maycontinue to enter into transactions with related parties.Upon completion of the Offer, Promoter / Promoter Group will own 55.80% of our post-Offer equity sharecapital. As a result, the Promoter Group will have the ability to control our business including mattersrelating to any sale of all or substantially all of our assets, the timing and distribution of dividends and theelection or termination of appointment of our officers and directors. In addition, for so long as the PromoterGroup continues to exercise significant control over the Company, they may influence the material policiesof the Company in a manner that could conflict with the interest of our other shareholders. The Promotergroup may have interests that are adverse to the interests of our other shareholders and may take positionswith which we or our other shareholders do not agree.xiii