Company: ZCARW
Filing Date: 2025-02-14
Form Type: 10-Q
Source: 0001213900-25-014437
Chunk: 239

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-02-14
Form: 10-Q
Item: Part I, Item 8
Chunk 239
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ZOOMCAR HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.Organization, Business operation and
                                            Going concern

Zoomcar Holdings, Inc. (formerly
“Innovative International Acquisition Corp”) a Delaware corporation provides mobility solutions to consumers and businesses.
The accompanying Condensed Consolidated Financial Statements include the accounts and transactions of Zoomcar Holdings, Inc. and its
subsidiaries (collectively, the “Company” or “the combined entity” or “Zoomcar”). The Company operates
its facilitation services under the Zoomcar brand with its operations in India.

Going concern

The accompanying Condensed Consolidated
Financial Statements have been prepared in accordance with U.S. GAAP and the rules and regulations of the SEC. The Condensed Consolidated
Financial Statements have been prepared using U.S. GAAP applicable to a going concern that contemplates the realization of assets and
settlement of liabilities in the normal course of business. The Company incurred a net loss of $7,922,063 and $13,805,617 during the three
months and nine months ended December 31, 2024, and cash used in operations was $5,043,721 for the nine months ended December 31, 2024.
The Company’s accumulated deficit amounts to $321,357,118 (March 2024: $307,551,501). The Company has negative working capital of
$40,754,964 as on December 31, 2024. In addition, the Company’s cash position is critically deficient and critical payments to the
operational and financial creditors of the Company are not being made in the ordinary course of business, all of which raises substantial
doubt about the Company’s ability to continue as a going concern.

The Company expects to continue to
incur net losses and have significant cash outflows from operating activities for at least the next 12 months. Management has evaluated
the significance of the conditions described above in relation to the Company’s ability to meet its obligations and concluded that,
without additional funding, the Company will not have sufficient funds to meet its obligations within one year from the date the Condensed
Consolidated Financial Statements are issued. Management’s plans with respect to these adverse financial conditions that caused
management to express substantial doubt about the Company’s ability to continue as a going concern are as follows:

    a. On November 5, 2024, the Company entered into a securities purchase agreement in