India Infrastructure Investors Forum, New York - Report

IDFC - SSKI Securities Private Ltd.

701-702 Tulsiani Chambers, 7th Floor (East Wing), Nariman Point, Mumbai 400 021. Tel: 9122-6638 3300 Fax: 9122-2204 0282
“For Private Circulation only” and “Important disclosures appear at the back of this report”

India Infrastructure Investors Forum, New York

Conference Notes

Analyst: Shirish Rane (91-22-6638 3313; shirish@idcsski.com)
Bhoomika Nair (91-22-6638 3337; bhoomika@idfcsski.com)
Salil Desai (91-22-6638 3373; salil@idfcsski.com)
IDFC-SSKI Securities, in association with Institutional Investors, hosted the India Infrastructure Investors Forum
(IIIF) at The Metropolitan Club, New York on May 14th and 15th. The IIIF gave investors in the US and other
international markets, an opportunity to interact directly with 16 Indian companies and with leading policy makers
in the Indian infrastructure domain, including Mr. Anil Razdan, Secretary, Ministry of Power, Mr. V Subramanian,
Secretary, Ministry of New & Renewable Energy and Mr. Brahm Dutt, Secretary, Ministry of Roads. The IIIF also
hosted special addresses by Prof. Raghuram Rajan, former Chief Economist, The International Monetary Fund,
Mr. Deepak Parekh, Chairman, HDFC and Ambassador Neelam Deo, Consul General of India in New York.

List of speakers / participating companies
KEYNOTE SPEAKERS

Prof. Raghuram Rajan Former Chief Economist, International Monetary Fund
Mr. Anil Razdan Secretary, Ministry of Power
Mr. V Subramanian Secretary, Ministry of New & Renewable Energy
Mr. Brahm Dutt Secretary, Ministry of Roads
Mr. Deepak Parekh Chairman, HDFC Ltd.
Ms. Neelam Deo Consul General of India, New York
COMPANIES PARTICIPATING
NTPC Ltd. Mr. R S Sharma – Chairman and Managing Director
Power Finance Corporation Ltd. Dr. V K Garg – Chairman and Managing Director
Mr. R. Nagarajan – Executive Director (Finance)
Power Grid Corporation of India Ltd. Dr. R P Singh – Chairman and Managing Director
Mr. S K Sharma – Addl. General Manager
National Hydroelectric Power Corporation Ltd. Mr. S K Garg – Chairman and Managing Director
GVK Power and Infrastructure Ltd. Mr. G V Sanjay Reddy – Vice Chairman
Mr. Issac George – Chief Financial Officer
Ms. Mala Paropkari – Vice President – Investor Relations
Gammon Infrastructure Projects Ltd. Mr. Parag Parikh – Chief Financial Officer
Adani Group Mr. K Venugopal – Vice President (Corporate Finance) – Infrastructure
Monnet Ispat and Energy Ltd. Mr. Sandeep Jajodia – Executive Vice Chairman and Managing Director
Mr. Ajay Bhat – Chief Financial Officer
JSW Group Mr. Sajjan Jindal – Chairman
Mr. U K Mukhopadhyay – Chief Executive Officer, Infrastructure
UB Group Mr. Harish Bhat – Dy. President & Group Treasurer
Provogue (India) Ltd. Mr. Nikhil Chaturvedi – Founder and Managing Director
Essar Group Mr. Madhu S Vuppuluri, President, Essar Americas
Indu Projects Ltd Mr. S P Reddy – Chairman and Managing Director
Manipal Education Mr. Anand Sudarshan – Chief Executive Officer and Managing Director
Mahindra and Mahindra Ltd. Mr. Arun Nanda – Executive Director and President, Infrastructure Development Sector
Feedback Ventures P. Ltd. Ms. Rumjhum Chatterjee – Managing Director and Co-founder
KSK Energy Ventures Ltd. Mr. S Kishore – Founder and Executive Director
21 May 2008
BSE Sensex: 17243

INDIA RESEARCH
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KEYNOTE ADDRESSES
The IIIF begin with a keynote address by Prof. Raghuram Rajan on reforms in the Indian banking system. Over the
course of the following two days, the IIIF hosted plenary sessions on three key infrastructure themes – Power,
New and Renewable Energy and Land & Environment. The discussions on the three themes were led by Mr. Anil
Razdan, Mr. V Subramanian and Mr. Deepak Parekh respectively. Additionally, a special session on roads and
highways was addressed by Mr. Brahm Dutt.
PROF. RAGHURAM RAJAN – FORMER CHIEF ECONOMIST, THE INTERNATIONAL MONETARY FUND
• Prof. Rajan argued for reforms in India’s banking system in order to achieve economic growth rate targets set by the
government
• Banks need to extend their reach significantly in order to cover rural and remote areas, in order to strengthen the
overall system
• In order to profitably provide banking services to the rural areas, banks have to implement innovative solutions and
may have to do away with the traditional models of opening branches or merely offering loan products to rural
residents. An initial step in expanding rural banking services could be to provide savings products initially, since rural
areas typically do not have access to the basic savings product and subsequently expand operations to cover the entire
gamut of services
• The government and the banking regulator must adopt a market linked compensation policy for top managers of
PSU banks in order to incentivize them for better performance
• Prof. Rajan argued that India as a country, given its democratic fabric, tends to debate a lot when it comes to
reforms. However, reforms will eventually happen although it may take time. Going forward, Prof. Rajan believes
that the reforms in the banking sector are moving in the right direction.
MR. ANIL RAZDAN – SECRETARY, MINISTRY OF POWER
• India continues to experience very high shortages - peak power shortage of 15% and base load shortages of 10%.
• The focus of the 11th plan is to step up power generation capacity, with a target of over 78,500MW of fresh
capacity additions
• Over 10,000MW of new power capacity has been commissioned in FY08 and the government is targeting to raise
annual capacity additions to 20-25,000MW by 2017
• Corresponding augmentation of the country’s transmission capacity is also critical on the government’s agenda, with
the national grid expected to connect the entire country over the next five years
• In power distribution, the government is planning to reduce AT&C losses to 15% by the end of the 11th five year
plan, from 34% currently. A revised APDRP scheme is under finalization and is expected to be announced soon.
The revised APDRP scheme is likely to link the grant component of the APDRP scheme to sustainable AT&C loss
reduction over the 5 year period.
• The role of the private sector is assuming importance and private sector participation in power generation,
transmission and distribution is a policy priority for the government.
• Equipment already ordered for 61,000MW of capacity planned for addition in the 11th plan. Additionally,
equipment for 11,000MW of captive power capacity has also been ordered by end of FY08.
• Government is seriously thinking of putting a pre condition of manufacturing facilities in India for equipment
suppliers bidding for new projects. This is to ensure after sales service and to take care of any potential national
security issues.
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• Energy efficiency and control over emissions are expected to be the guiding principles of India’s power policy. The
per capita emissions of the Indian power sector are ~1/20th of the USA and ~1/10th of other developed and
developing countries and the government intends to maintain control over emissions.
MR. BRAHM DUTT – SECRETARY, DEPARTMENT OF ROAD TRANSPORT & HIGHWAYS
• India has a total highway network of 66,754kms, of which only 14% has been four-laned so far.
• The lack of sufficient highways has been a constraining factor for road transport in India – normal distance travelled
by trucks in India is 250-300kms per day whereas the international norm is 600-800kms per day
• The government of India has significantly expanded the scope of the National Highways Development Programme
(NHDP) for upgrading 49,014kms of the highway network to 4 and 6 lanes
• The total investments under the NHDP and on upgrading of North East region roads is expected to be ~US$75bn,
of which US$51bn is expected to be made by the private sector under toll-based BOT projects
• The government has funded its contribution to the NHDP through the Central Road Fund, under which a cess of
Rs2/litre has been levied on petrol and high speed diesel. In FY07, a total amount of Rs64bn was allocated to
NHDP from the Central Road Fund
• A standardized new Model Concession Agreement (MCA) for roads has been finalized and adopted. The new MCA
incorporates certain new features such as a limit of 6 months from date of award of project for achieving financial
closure, 50% of required land to be handed over by NHAI to the concessionaire on or before financial closure,
revenue sharing based on traffic growth etc.
• New highway projects have been recently awarded on the basis of the new policy on PPP projects, the RFQ
document limits the number of concessionaires for prequalification between 6 and 10 players.
MR. V SUBRAMANIAN – SECRETARY, MINISTRY OF NEW AND RENEWABLE ENERGY
• The government of India is committed to promoting the use of new and renewable energy for supplementing the
energy requirements of the country. The key objective of the government is to enhance energy security, by reducing
dependence on external sources of fossil fuels and promoting use of renewable energy
• India has the potential to harness energy from a variety of renewable sources, the main ones being biomass, biogas,
sun, wind and small and mini hydel plants.
• Currently, about 5% of the total power generating capacity in India is contributed by renewable sources and the
government plans to gradually increase the renewable energy component over the long term
• In order to promote higher investments in new and renewable energy, the government has adopted incentives in
three forms:
o Tax incentives – these include incentives on indirect taxes such as concessional duty imports of equipment for
generating electricity through renewable energy sources and incentives on direct taxes in the form of tax
exemptions and tax holidays
o Most state governments have announced their own policies and are offering higher tariffs for procuring
electricity generated using renewable energy sources. The high tariffs have attracted a large number of private
investors in setting up renewable energy based power plants
o Finally, the government is also propagating the benefits of using carbon credits in order to attract private
players to invest in power generation plants based on renewable energy sources
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MR. DEEPAK PAREKH, CHAIRMAN, HDFC LTD.
• India’s economic growth has been constrained by inadequate investments in development of proper infrastructure
facilities. Spending on infrastructure has to be increased from 4.5% of GDP currently to 9% of GDP, to achieve the
targeted economic growth rate in the 11th five year plan
• Among the key challenges in infrastructure development, acquisition of land remains the most critical – especially
acquisition of rural land, which displaces farmers not only from homes, but from their source of livelihood as well
• Any policy for acquisition of land for infrastructure development must ensure that land owners also benefit from the
development. The new hydro power policy is a step in the right direction, as it provides for a certain portion of the
power generated (1% o the total generation) to be offered free of cost within the area of the project, thus enabling
the local population to benefit from the project
• Another area of focus in infrastructure development is integrated development (inclusive of access routes and other
related facilities) of infrastructure mainly for airports and ports. Recently, the new Hyderabad airport started
operations, but the improvement in the access roads to the airport is still 9 to 12 months behind schedule.
• The government must explore policies that encourage corporate participation in agriculture. Under such a model,
farmers can lease their land to a company in return for rental income and at the same time, have an option for
seeking employment with the company. This model can ensure higher productivity of farm land due to private
sector efficiency and large scale of operations, while augmenting rural incomes by way of rental as well as from
regular employment
• In cases where it is possible, land owners can themselves become developers of land, thereby gaining directly from
alternative uses of land. A prime example of such a model is Magarpatta city near Pune, where farmers have pooled
about 400 acres of land to develop IT parks and office buildings, which ensures them regular rental income
significantly higher and consistent than the farming income
• Lastly, Mr. Parekh stressed the need for parallel development of social infrastructure in order to achieve sustained
and inclusive economic growth of cities. To this end, the government must ensure a policy framework for giving free
land for schools, colleges, hospitals etc. as the developing cities are facing huge constraints in these areas.
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CORPORATE PRESENTATIONS
The IIIF saw participation from 16 leading infrastructure companies in India. We present below the key highlights
of their presentations.
NTPC LTD. OUTPERFORMER
Price Rs191; Mkt Cap: US$37bn
􀂉 Mr. R S Sharma – Chairman and Managing Director
• NTPC operates 26 power coal and gas based plants in India currently, with a total generating capacity of
29,384MW. The company has a 19% share in total power capacity in India and a 29% share of the total energy
generated in India.
• NTPC plans to increase its power generating capacity by ~25,000MW in the 11th five year plan, of which
1,990MW has already been commissioned, 16,680MW is under construction and 3,760MW is under tendering. In
the 12th five year plan, NTPC plans to add anther 25,00MW of capacity, taking its total installed capacity to
~75,000MW by FY17.
• NTPC sells the entire power generated by it through long term PPAs, which not only secure off-take but also have
strong payment security mechanisms in place to ensure timely realisations.
• In FY08, NTPC generated 201bn units of electricity, an increase of 6.5% over FY07. FY08 (provisional) revenues
increased by 21.6% yoy to Rs370bn and recurring PAT increased by 12.8% yoy to Rs74bn
• NTPC is planning to diversify its fuel mix, by setting up power plants across different fuel types. Over the next ten
years, NTPC plans to set up 9,000MW of hydel power plants, 2,000MW of nuclear capacity and 1,000MW of nonconventional
energy based power plants.
• To ensure fuel security, NTPC has secured seven captive coal block allocations with estimated reserves of ~47mn
tons per annum. The company has also been allocated one oil/gas block to meet its part requirement of ~5mn tons
of gas per annum by 2010. Moreover, the company is exploring opportunities to import coal as and when required
• NTPC has formed 50:50 JV with BHEL for undertaking EPC activities of power plants. The JV is also likely to
undertake manufacturing of power equipments over the next 2-3 years.
• NTPC has also formed a JV (49:51) with Bharat Forge to manufacture forged parts required in the power plants.
The JV is likely to start operations over the next 2-3 years.
POWER FINANCE CORPORATION LTD. UNRATED
Price Rs147; Mkt Cap: US$4.2bn
􀂉 Dr. V K Garg – Chairman and Managing Director
􀂉 Mr. R Nagarajan – Executive Director (Finance)
• The total funding requirement for the intended investments by the government and the private sector in power
generation, transmission and distribution in the 11th plan is ~US$265bn, with an equity requirement of US$87bn
and US$178bn of debt. Of the total investment required, equity of US$38bn and debt of US$71bn is still
unfunded.
• PFC is the key lender to the power sector in India, with cumulative sanctions of US$47bn and cumulative
disbursement of US$23bn as on March 31, 2008. Of the company’s total loan book, 77% is to power generation
and the balance to transmission, distribution and allied activities.
• In FY08, PFC’s total income increased by 28% to US$1.26b while net interest income increased by 28% to
US$453mn, led by a 23bps improvement in net interest margin to 3.75%
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• Loan assets in FY08 increased by 17% to US$12.9bn, while gross NPAs decreased from 0.1% as on March 31, 2007
to 0.03% as on March 31, 2008 net NPAs over the same period reduced from 0.06% to 0.01%. The company
reported an average RONW of 14.33% in FY08.
• Some of the major projects financed by PFC in FY08 include Adani Power’s 1.320MW thermal power plant in
Gujarat, Chhattisgarh State Electricity Board’s 1,000MW thermal power plant in Chhattisgarh, NEEPCO’s
600MW hydro power plant in Arunachal Pradesh and NHPC’s 510MW Teesta-V hydro power plant in Sikkim.
• Going forward, while continuing to grow in its existing core business, as part of its business strategy PFC is also
planning to focus on exploring new opportunities and expand services to customers, increase non-fund based services
by leveraging on its experience in the power sector, facilitate development and funding of larger project and diversify
its borrower portfolio across different fuel based generation
POWER GRID CORPORATION OF INDIA LTD. UNRATED
Price Rs103; Mkt Cap: US$10.9bn
􀂉 Dr. R P Singh – Chairman and Managing Director
􀂉 Mr. S K Sharma – Addl. General Manager
• The 11th five year plan is expected to see investments of US$65bn in state transmission, US$25bn in APDRP and
rural electrification programmes and US$19bn in central transmission. PGCIL is expected to invest US$14bn over
FY08-12 in expansion of the central transmission network
• PGCIL currently operates as India’s central transmission utility (CTU), mandated to build, operate and maintain
the state, regional, national and inter-national transmission networks as also to build, operate and maintain regional
and national load despatch centres. PGCIL has already established inter-regional power transfer capacity of
17,000MW and is planning to increase it to 37,000MW by 2012 and 65,000MW by 2017.
• PGCIL has been focusing on continuously adopting new technologies to improve the efficiency and reliability of the
transmission network. The company has already adopted the 765KV AC technology and is working towards
development of 1,200KV AC systems in order to cater to the envisaged increase in load capacity of the national grid
• Revenues over FY03-08 have increased at a CAGR of 13.2% from Rs25.3bn to Rs47bn while PAT over the same
period has increased at a CAGR of 17.2% to Rs14.2bn from Rs6.4bn
• PGCIL, in order to broad base its revenues and to utilise its asset base more effectively, has diversified in to telecom
services by hosting inter-regional telecom networks on its existing transmission infrastructure. The company has
already established a 20,000km telecom network connecting 60 towns/cities across India. PGCIL has also diversified
into state transmission and distribution and providing consulting services in T&D segment.
• PGCIL has also been at the forefront of promoting private sector participation in transmission, having forged JVs
with large private sector power companies such as Tata Power and Reliance Energy for setting up transmission lines.
NATIONAL HYDROELECTRIC POWER CORPORATION LTD. UNLISTED
􀂉 Mr. S K Garg – Chairman and Managing Director
• The CEA has estimated 148,701MW of hydro power potential in India, of which, only 34,261MW has been
developed so far while an additional 14,535MW is under development. The government has launched an initiative
for development of 50,000MW of hydro power capacity in the country over the next ten years
• NHPC is the largest and the most experienced hydro power developer in the country, with 4,665MW of power
pants under operation currently and 5,132MW of plants under development. NHPC has a target of developing
5,322MW of hydro power capacity in the 11th plan and 13,941MW in the 12th plan
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• NHPC has established a specialist in-house team for project design and has developed engineering capabilities
ranging from concept to commissioning of hydro power projects. On the basis of its design and engineering skills,
NHPC has established a strong track record of successful execution of projects.
• NHPC’s experience and project execution skills have created significant entry barriers for new entrants in the
business
• NHPC sells the entire power generated by it through long term PPAs and all billings to state entities are secured
through letters of credit, which ensure off-take as well as payment security for NHPC
• The government is considering a policy with differential tariffs for base and peak loads, which provides NHPC with
a significant upside by supplying peaking load power. The new hydropower policy allows up to 40% of saleable
energy to be sold as merchant power
• NHPC reported FY07 turnover of US$491mn (+14.5% yoy) and a net profit of US$231mn (+24.2% yoy). The
company’s net worth as on March 31, 2007 was US$4.1bn
• NHPC is planning to raise equity funds through an IPO by August 2008 to part finance 3,080MW of identified
hydro power plants under construction. The total equity requirement for these projects is expected to be ~Rs17.9bn.
The proposed IPO also includes an offer for sale by the government of~5% of its existing shareholding, resulting in a
total equity dilution of ~13%.
MONNET ISPAT & ENERGY LTD. OUTPERFORMER
Price Rs527; Mkt Cap: US$625mn
􀂉 Mr. Sandeep Jajodia – Executive Vice Chairman & Managing Director
􀂉 Mr. Ajay Bhat – Chief Financial Officer
• MIEL’s product portfolio comprises sponge iron, steel, ferro alloys and power generation. The company plans to
increase its steel capacity 4x, to 1.2m tpa by July 2009, with emphasis on forward integration into value added
products.
• MIEL is also setting up a 1,050MW thermal power plant at Angul in Orissa through its wholly-owned subsidiary
Monnet Energy (MEL). MEL has already achieved financial closure for its 1,050MW Angul power plant. The
power plant would be commissioned in three equal stages, beginning first quarter of FY11.
• MEL has been allotted two independent coal mines with mineable reserves of 180mn tons, for meeting the fuel
requirement of its Orissa power plant. MIEL would derive cost competitiveness from its captive coal mines, which is
expected to lead to significantly higher RoE than a regulated power business.
• MIEL’s 100% subsidiary Monnet Global Ltd. (MGL), has got into agreement with PT Anzwara, Indonesian
company for development/ selling of produce from the coal mine with reserves of 80mt. MIEL indicates scope exists
to increase mining reserve to 300-400MT. Commercial operation expected to begin by Q2FY09
JSW GROUP
􀂉 Mr. Sajjan Jindal – Chairman
􀂉 Mr. U K Mukhopadhyay – Chief Executive Officer, Infrastructure
• The JSW Group, with interests in steel, power, aluminium, cement, infrastructure, mining and IT has a group
turnover in excess of US$3.7bn
• JSW Steel has an annual capacity of 4.8mtpa tons with manufacturing facilities located at Vijayanagar in Karnataka,
Salem in Tamil Nadu, Vasind and Tarapur in Maharashtra, apart from 1.2mtpa tons plate mill and 0.55mtpa pipe
mill in Houston, USA. JSW Steel is planning to increase its capacity to 10mtpa by 2010 and further to 31mtpa by
2020
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• JSW Energy operates a 260MW thermal power plant at its Vijayanagar facility.
• JSW Energy is planning to increase its total power capacity to 13,270MW by 2014
• The company is planning to raise funds through an IPO to part finance its power capacity expansion plans
• JSW Aluminium is setting up a 1.4 Mt Alumina Refinery, 0.25 Mt Aluminium Smelter and 600 MW Captive
Power Plant. The facility is being set up at near Vishakhapatnam in Andhra Pradesh. The project will be selfsufficient
for its bauxite needs. Various statutory clearances have been taken and land acquisition activities are in full
swing.
• JSW Cement has 0.3 MT of Portland slag cement making capacity at Vijayanagar. By year 2010 JSW steel plants
will produce 3.5 MT of slag which is sufficient to produce 7 Mt cement. JSW Cement Ltd. will set up cement plants
adjacent to all upcoming steel plants of the group, thus making it a leading cement producer of the country.
• JSW Natural Resources to mitigate risks against rising raw material costs has ventured into Mozambique and
Indonesia (for Coal) and Chile (for Iron Ore).
• JSoft, an IT & ITES arm of JSW group. Its core competency is to act as an enabler for enterprises, to gain a
competitive edge through effective use of information & communication solutions.
GVK POWER AND INFRASTRUCTURE LTD. OUTPERFORMER
Price Rs51; Mkt Cap: US$1.4bn
􀂉 Mr. Sanjay Reddy – Vice Chairman
􀂉 Mr. Issac George – Chief Financial Officer
􀂉 Ms. Mala Paropkari – Vice President, Investor Relations
• GVK’s 220MW Jegurupadu-II and 464MW Gautami power plants are expected to commence commercial
operations by July 2008, using gas supplied by Reliance Industries (RIL). RIL and GVK have entered in to an MOU
for supply of gas for both the plants and a formal fuel supply agreement is expected to be signed soon
• The Andhra Pradesh government has allowed GVK to sell 20% of the power generated from the J-II and Gautami
power plants on merchant basis in the open markets. Moreover, the government has granted GVK permission to
expand capacity of its J-II plant by 500MW and the Gautami plant by 1,000MW and to sell the entire power
generated from the additional capacity of 1,500MW on merchant basis
• The Jaipur-Kishangarh Expressway continues to experience strong traffic growth of about 12%.
• GVK has completed the land acquisition for its 3,000 acre SEZ in Perambalur, Tamil Nadu and is now considering
expansion of the SEZ size to 5,000 acres. The SEZ is aimed at primarily catering to industries such as textiles, leather
etc.
• The Mumbai airport expansion is developing as per schedule and Terminal 2B at the International terminal has
started operations, which will lead to the phased shut down of terminal 2A for modernisation.
• The company is bidding for a number of projects across sectors, the large ones of which include modernisation of
New Delhi railway station, Hyderabad Metro rail and 800MW Bhadrawati power project
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GAMMON INFRASTRUCTURE PROJECTS LTD. OUTPERFORMER
Price Rs169; Mkt Cap: US$610mn
􀂉 Mr. Parag Parikh – Chief Financial Officer
• Gammon Infrastructure Projects Ltd. (GIPL) has built a diversified portfolio of 14 infrastructure BOT projects,
across sectors such as roads, ports, power and SEZ. The company has 4 projects in operations, 7 in the development
phase and 3 in the pre-development phase. Some of GIPL’s large projects include the Mumbai-Nasik highway, the
Mumbai offshore container terminal, Vizag seaport, Tidong hydro power plant and biomass power projects in
Haryana and Punjab
• GIPL’s projects are diversified across revenue streams, with a mix of fixed returns (annuity-based) and market driven
(toll-based) projects. The asset mix provides the company a steady stream of revenues while enabling it to leverage
upsides from market linked returns
• Leveraging on its parent Gammon India’s experience and strengths in the EPC business, GIPL has developed strong
project management and execution capabilities. The company’s Rajamundhry-Dharmavaram and Dharmavaram-
Tuni expressways were commissioned 70 and 30 days ahead of schedule respectively while its Cochin bridge project
was commissioned 10 months ahead of schedule
• GIPL has managed to extract greater value from its concessions by aggressive gearing and innovative financial
structuring. The Mumbai-Nasik Expressway project was funded by the company at a gearing of 6.1x while the Kosi
bridge and Gorakhpur bypass projects were funded at a gearing of 8.1x
• In addition to the projects already under awarded to GIPL, the company has been declared the preferred bidder in
two projects, which include a 260MW Yangthang hydel power plant in Himachal Pradesh and the Bedi port in
Gujarat.
• GIPL is also bidding for infrastructure projects across sectors and has already submitted financial bids for 3 projects
and has qualified to place bids for 14 projects. In order to bid for new projects, GIPL has forged partnerships with
leading domestic and international players, which include GVK Power, IDFC, Torrent Power, Reliance Industries,
Macquarie Capital, Dragadoss, China Light and Power etc.
ADANI GROUP – ADANI ENTERPRISES LTD. OUTPERFORMER
Price Rs868; Mkt Cap: US$5.3bn
􀂉 Mr. K Venugopal – Vice President (Corporate Finance)
• AEL, a diversified conglomerate has, among other things, a presence in international trading of commodities, coal
mining in India and abroad, power generation, real estate, oil and gas exploration, city gas distribution,
manufacturing of edible oils etc.
• Adani Power Ltd. (APL), a 86% subsidiary of AEL has firmed up plans to set up 10,000MW of power generating
capacity over the next 4-5 years.
• APL is expected to source fuel from AEL’s coal mines in Indonesia (reserves of 150 mn tons) and from captive coal
blocks in India (reserves of 180 mn tons)
• APL is planning to raise funds through an IPO to finance its power expansion plans and has already filed a Draft
Red Herring Prospectus.
• AEL has expanded its real estate footprint to cities such as Surat and Kochi, with planned development of about
8.8mn sq. ft. Consequently, the total planned development of AEL now stands at over 105mn sq. ft.

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ADANI GROUP – MUNDRA PORT AND SPECIAL ECONOMIC ZONE LTD. OUTPERFORMER
Price Rs885; Mkt Cap: US$8.3bn
􀂉 Mr. K Venugopal – Vice President (Corporate Finance), Infrastructure
• MPSEZ is the developer of the Mundra port (FY08 traffic of ~28.5mn tons) and the 32,000 acre Mundra SEZ and
through subsidiaries, is currently implementing development of a dry bulk terminal at Dahej and has entered the
container rail and logistics businesses
• MPSEZ is setting up a 35mtpa dedicated coal terminal for handling the imported coal requirements of Tata Power’s
Mundra UMPP and Adani Power’s 4,620 Mundra power plant. The dedicated coal terminal is expected to be
commissioned by FY11
• The company’s container rail business has commenced commercial operations with two rakes and is expected to add
four more rakes by June 2008
• MPSEZ has already acquired land of 18,480 acres for its SEZ and another 13,094 acres is under acquisition.
Government has notified 6,753 acres of land for its SEZ.
• MPSEZ has started selling the land in its SEZ to various industrial users through its Textile and Apparel Park and
other direct sales.
• MPSEZ has also allocated 1000 acres of land for third party development.
PROVOGUE (INDIA) LTD. OUTPERFORMER
Price Rs1,200; Mkt Cap: US$702mn
􀂉 Mr. Nikhil Chaturvedi – Founder and Managing Director
• Provogue, a leading fashion brand in India, is rapidly emerging as a retail infrastructure company through its 75%
subsidiary Prozone
• Provogue has forayed into retail real estate development alongwith Liberty International, UK, one of the largest retail
real estate developer and mall management companies with AUM of GBP10bn+. Liberty International owns 25% in
Prozone
• Prozone would be primarily involved in developing mega malls, akin to regional shopping centers, in Tier II cities,
besides developing residential, commercial and hotel properties around the retail properties
• Prozone currently has commenced construction for 4 of its properties (Aurangabad, Jaipur, Nagpur, Indore)
spanning across over 15m sq. ft.. including 5m of retail space. Prozone has parked these four projects under an SPV,
wherein it sold 27% stake to Old Mutual for Rs4.6bn of consideration
• Prozone has further signed up for 8 more properties.
UB GROUP
􀂉 Mr. Harish Bhat – Dy. President & Group Treasurer
• UB Group (UB Holding the holding company) is a leading conglomerate with presence across alcoholic beverages,
aviation, real estate, engineering, etc.
• United Spirits, the liquor company, is India’s largest and world’s third largest liquor company post the acquisition of
Whyte & Mackay. USL currently sales over 73.9m cases
• United Breweries, the beer company, accounts for 48% of Indian beer industry and the flagship brand is Kingfisher.
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IDFC - SSKI INDIA
• UB Group is also now the largest private domestic aviation company post the acquisition of Deccan Aviation (50%
for US$287m) and accounts for 30% of the market. Kingfisher Airlines has 75 aircrafts under operations and is
expected to add over 189 aircrafts over the next decade. Post the merger of Kingfisher Airlines with Deccan Aviation,
KFA would soon commence its international operations.
• UB Engineering, the projects company of UB Group, has turnover of US$70m with installation projects across
power, fertilizers, oil & gas, fire fighting, agri, etc.
• UB Group also has presence in real estate business and has 50 % share in the development fo 900,000 sq. ft. of UB
City. UB City is a prime property in Bangalore and houses commercial offices, banks, high-end retail stores, 1 five
star hotel, serviced apartments, restaurants, food courts, pubs, health clubs, cafes etc. It garners rental revenues of
~US$12-13m annually and is valued at USD125m.
MANIPAL EDUCATION AND MEDICAL GROUP UNLISTED
􀂉 Mr. Anand Sudarshan – Chief Executive Officer & Managing Director
• Part of the Manipal Education and Medical Group, Manipal Universal Learning Private Limited (MUL) houses the
education interests of the Manipal Group, which has over 50 years of experience in the Education and Healthcare
industry.
• MUL is the largest pure-play private education services provider in India, encompassing a wide variety of educational
models such as distance learning, campus-based education and online programs.
• MUL caters to over 100,000 students through its Distance Education program alone, and manages a network of
over 550 Learning Centers all over the country.
• In addition to its formal education services, MUL has focused on enhancing employability of the youth through its
foray into skill-based vocational training and continuing education segments. MUL has also partnered with India Inc
to provide customized education and training solutions to companies for their employees.
• MUL has expanded its global footprint by setting up/ acquiring international campuses in locations such as Dubai,
Nepal, Malaysia and Antigua, imparting education in various fields such as medicine, nursing, engineering,
management, information technology etc. It has also made a foray into the high-growth segment of online education
through its acquisition of a Singapore-based online education company.
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IDFC - SSKI INDIA
Analyst Sector/Industry/Coverage E-mail Tel. +91-22-6638 3300
Pathik Gandotra Head of Research; Banking, Strategy pathik@idfcsski.com 91-22-6638 3304
Shirish Rane Cement, Construction, Power, Real Estate shirish@idfcsski.com 91-22-6638 3313
Nikhil Vora FMCG, Media, Retailing, Mid Caps nikhilvora@idfcsski.com 91-22-6638 3308
Ramnath S Automobiles, Auto ancillaries ramnaths@idfcsski.com 91-22-6638 3380
Nitin Agarwal Pharmaceuticals nitinagarwal@idfcsski.com 91-22-6638 3395
Ganesh Duvvuri IT Services, Telecom ganesh@idfcsski.com 91-22-6638 3358
Varatharajan S Oil & Gas varatharajan@idfcsski.com 91-22-6638 3240
Chirag Shah Textiles, Metals chirag@idfcsski.com 91-22-6638 3306
Bhoomika Nair Construction, Power, Logistics, Engineering bhoomika@idfcsski.com 91-22-6638 3337
Avishek Datta Oil & Gas, Engineering avishek@idfcsski.com 91-22-6638 3217
Bhushan Gajaria FMCG, Retailing, Media, Mid Caps bhushangajaria@idfcsski.com 91-22-6638 3367
Shreyash Devalkar IT Services, Telecom shreyash@idfcsski.com 91-22-6638 3311
Nilesh Parikh, CFA Banking nilesh@idfcsski.com 91-22-6638 3325
Ashish Shah Automobiles, Auto Ancillaries ashishshah@idfcsski.com 91-22-6638 3371
Salil Desai Cement, Infrastructure salil@idfcsski.com 91-22-6638 3373
Rahul Narayan FMCG, Retailing, Media, Mid Caps rahulnarayan@idfcsski.com 91-22-6638 3238
Ritesh Shah Textiles, Metals riteshshah@idfcsski.com 91-22-6638 3376
Aashiesh Agarwaal, CFA Real Estate aashiesh@idfcsski.com 91-22-6638 3231
Neha Agrawal Banking neha@idfcsski.com 91-22-6638 3237
Swati Nangalia Mid Caps swati@idfcsski.com 91-22-6638 3260
Dharmendra Sahu Database Manager dharmendra@idfcsski.com 91-22-6638 3382
Dharmesh Bhatt Technical Analyst dharmesh@idfcsski.com 91-22-6638 3392
Equity Sales/Dealing Designation E-mail Tel. +91-22-6638 3300
Naishadh Paleja MD, CEO naishadh@idfcsski.com 91-22-6638 3211
Paresh Shah MD, Dealing paresh@idfcsski.com 91-22-6638 3341
Vishal Purohit MD, Sales vishal@idfcsski.com 91-22-6638 3212
Nikhil Gholani MD, Sales nikhil@idfcsski.com 91-22-6638 3363
Sanjay Panicker Director, Sales sanjay@idfcsski.com 91-22-6638 3368
V Navin Roy Director, Sales navin@idfcsski.com 91-22-6638 3370
Rohan Soares SVP, Sales rohan@idfcsski.com 91-22-6638 3310
Suchit Sehgal AVP, Sales suchit@idfcsski.com 91-22-6638 3247
Pawan Sharma MD, Derivatives pawansharma@idfcsski.com 91-22-6638 3213
Dipesh Shah Director, Derivatives dipeshshah@idfcsski.com 91-22-6638 3245
Manohar Wadhwa VP, Derivatives manohar@idfcsski.com 91-22-6638 3232
Sunil Pandit SVP, Sales trading suniil@idfcsski.com 91-22-6638 3400
Mukesh Chaturvedi VP, Sales trading mukesh@idfcsski.com 91-22-6638 3400
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Explanation of Ratings:
1. Outperformer: More than 10% to Index
2. Neutral: Within 0-10% to Index
3. Underperformer: Less than 10% to Index
Disclosure of interest:
1. IDFC - SSKI and its affiliates may have received compensation from the company covered herein in the past twelve months for Issue Management, Capital Structure,
Mergers & Acquisitions, Buyback of shares and Other corporate advisory services.
2. Affiliates of IDFC - SSKI may have mandate from the subject company.
3. IDFC - SSKI and its affiliates may hold paid up capital of the company.
4. The Equity Analyst holds 114 shares in National Thermal Power Corporation, 50 shares in United Spirits, 286 shares in Power Grid Croporation of India, 136 shares in
Power Finance Corporation of the company covered as on the date of publication of research on the subject company.
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Rohit