Company: MAGH
Filing Date: 2025-05-28
Form Type: F-1
Source: 0001641172-25-012644
Chunk: 13

Company: Magnitude International Ltd
Filing Date: 2025-05-28
Form: F-1
Chunk 13
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 while maximizing our profit margin. If we perceive keen competition on a particular project, we may submit a more competitive tender price with a lower mark-up margin, thereby reducing profitability. If the mark-up margin set by us is too low, we may be unable to cover the financial impact of any unfavorable circumstances during project implementation. On the other hand, if we try to allow for unfavorable circumstances and set a higher mark-up margin, our tender may become uncompetitive. There is no assurance that our pricing strategy and policy is effective or responsive to market price changes and changes in customers’ demand or that we will always be able to price our tenders competitively, failing which may cause us to be unsuccessful in the tender, thereby resulting in a decrease in the number of projects that may be awarded to us. In turn, this would adversely affect our business, results of operations, financial condition and business prospects. Most of our contracts with customers do not have any price adjustment mechanisms to accommodate any fluctuation in costs. As there is no assurance that the costs estimated at the beginning of a contract will not be increased during the contract period, we have to bear the risk of increasing costs accordingly. Cost overruns may result from inaccurate estimations of time and costs, increases in the costs of subcontracting, materials and labor, additional costs derived from unexpected technical difficulties encountered during the progress of the projects and rectification of work defects, adverse weather conditions, disputes with parties involved in the projects, changes in the regulatory requirements and government policies, inflation and unforeseen problems and circumstances, some of which are beyond our control. Changes or disagreements regarding project execution such as workmanship and choice of materials, among other things, may occur in a project. Any of these may also give rise to delays in completion of works or even unilateral termination of contracts by our customers due to unsatisfactory performance. If we are unable to control our costs within our estimates or recover the extra costs and control the progress of our projects, we may suffer cost overruns or even losses on our projects which may adversely affect our profit margin and results of operations.

All of our revenue is derived from competitive tendering and the contracts are not recurring in nature.

During the fiscal years ended April 30, 2023 and 2024, we derived all of our revenue from contracts awarded through a competitive tender process and the contracts are not recurring in nature. The growth of our business depends on our tendering successfully. Our existing customers are not under any contractual obligation to give us the first right for any future projects