SREI INFRASTRUCTURE FINANCE LIMITED

Analysts
y Meet Presentation

15 February 2010
Safe Harbour
In this communication we have disclosed forward-looking information to enable investors to comprehend our
prospects and take informed investment decisions. This report and other statements – written and oral - that we
periodically make contain forward-looking statements that set out anticipated results based on the management’s
plans and assumptions.
assumptions We have tried wherever possible to identify such statements by using words such as
‘anticipate’, ‘estimate’, ‘expects’, ‘projects’, ‘intends’, ‘plans’, ‘believes’, and words of similar substance in
connection with any discussion of future performance.

We cannot guarantee that these forward-looking statements will be realised, although we believe we have been
prudent in assumptions.
assumptions The achievement of results is subject to risks, risks uncertainties and even inaccurate
assumptions. Should known or unknown risks or uncertainties materialise, or should underlying assumptions prove
inaccurate, actual results could vary materially from those anticipated, estimated or projected. Readers should bear
this in mind.

We undertake
W d t k no obligation
bli ti t publicly
to bli l update
d t any forward-looking
f d l ki statement,
t t t whether
h th as a result
lt off new
information, future events or otherwise.

The information contained herein has been prepared solely for information purposes and is not an offer or
solicitation of an offer to buy/sell the securities/instruments mentioned or to participate in any trading strategy or an
official confirmation.

This is not a research but it may refer to a research analyst/research report. The Company does not represent that
the information contained herein is accurate or complete. Information is subject to change without notice and we
mayy not update
p this. Past p
performance is not indicative of future returns. This p
price information ((if any)
y) is p
provided
solely for informational purposes and may differ substantially from price information available from other sources or
an actionable price.
Vision and Mission Statement

Vision

To be the most inspiring global holistic

infrastructure institution

Mission
To be an Indian multinational company
providing innovative integrated
infrastructure solutions

3
History

Started operations and identified infrastructure sector as the core

1989 business

1992 Initial Public Offering. Listed on all major Stock Exchanges

1997 IFC, FMO and DEG invested as strategic equity partners

2005 1st Indian NBFI to be listed on the London Stock Exchange

2008 JV with BNP Paribas Lease Group, 100% subsidiary of BNP Paribas

4
Board of Directors

NAME PREVIOUS EXPERIENCE

Salil Gupta, ƒ Chairman, West Bengal Industrial Development Corp.
Chief Mentor ƒ President,
President Institute of Chartered Accountants of India
Hemant Kanoria, ƒ President, Calcutta Chamber of Commerce
Chairman & Managing Director ƒ Chairman, CII (ER) Infrastructure
Sunil Kanoria,
ƒ Presently Vice Chairman & Managing Director of Quippo Infrastructure
Vice Chairman
Equipment Ltd.

Saud Siddique, ƒ Former IFC (World Bank, Washington) , Principal Investment Officer and
Jt. Managing Director East Asia head having vast experience in infrastructure sector
K. K
K K. Mohanty,
Mohanty ƒ A Professional Entrepreneur with Engineering & Management Education
Wholetime Director having more than 20 yrs experience in Infrastructure & Core sector
ƒ Chief Economist and Director, Asian Development Bank
Dr. S.C. Jha ƒ Economic Advisor to the United Nations
ƒ Member,, Prime Minister’s Council of Economic Advisors
ƒ Senior Executive Director, SEBI
V.H. Pandya
ƒ Director, GIC Asset Management and Reliance Capital
S. Rajagopal ƒ CMD, Bank of India & Indian Bank
ƒ Presently Chairman of Ingersoll Rand, India
D ljit Mirchandani
Daljit Mi h d i
ƒ Executive Director, Kirloskar Oil Engines
S. Chatterjee ƒ Executive Director, Axis Bank

5
Key Businesses
 Eq
quipment
Financing
F

Project
F
Financing
Business Verticals

Proje
ect Advisory
y

Investment Bankin
ng

of QIEL
Venture
e Capital / Fu
und
Maanagement

Telecom
m Infrastructture

Tran
nsportation
HOLISTIC INFRASTRUCTURE INSTITUTION

Power

Rural IT
T Infrastructure

Quip
ppo Rentals
Srei has added business lines such as Telecom Infrastructure and Quippo Rentals through the amalgamation

SEZ and Industrial P

Parks
Equipment Financing

Financing Insurance Broking

Construction, Mining, Oil & Gas, Life,

Power (conventional & renewable), Non Life,

Ports, Railways, Aviation, Telecom Reinsurance

Financial Snapshot as on 31st December 2009

Net Worth (Rs cr.) 936
Asset Under Management (Rs Cr.) 8,075
NIM (%) 4.76 %
Net NPA 0.92%
CAR 15.75

8
Project Financing

Business Overview
ƒ Financing through term loans & leasing:

ƒ Roads ƒ Aviation
ƒ Power ƒ Mining
ƒ Ports ƒ Telecommunication
ƒ Railways ƒ Oil & Gas

Financial Snapshot as on 31st December 2009

Net Worth (Rs cr.) 775
Asset Under Management (Rs Cr.) 3,890
NIM (%) 5.68%
Net NPA -
CAR 18.90

9
Advisory Services
ƒ Project Advisory
• Project conceptualization & Pre-feasibility studies
• Project Monitoring

ƒ Investment Banking
• Debt Syndication
• Equity Syndication
• IPOs
• Mergers, Acquisitions & Valuations

ƒ Fund Management (Venture Fund)

Financial Snapshot as on 31st December 2009

Fee Based Income (Rs cr.) 17
Funds Under Management (Rs Cr.) 869

10
Infrastructure Investments
Fig in Rs Cr
SECTOR TOTAL

Strategic Long Term Investments

Subsidiaries 47
Joint Venture 25
Quippo ( Treasury Stock) 19
Infrastructure Investments
Transportation 237
Passive Infrastructure - Telecom 337
Port 2
Power 16
SEZ & Industrial Parks 4
Rural Infrastructure 1
Oil & Gas 30
Investment in Financial Services 22
Quoted Investments 54
Investment in Debt / Debt Funds 66
Total* 859

* Investments held directly or through funds 11

Synergistic Integration
Srei +Quippo
Synergistic Integration – Srei+Quippo

Creation of a fully integrated and Holistic Infrastructure Institution bringing all infrastructure business
#1 under one umbrella – equipment financing, project financing, advisory, development and Quippo’s
infrastructure business

#2 Enhancement of shareholder value

#3
#3 Expanded spectrum of infrastructure products & services to customers

#4
#4 Wider service portfolio leading to increased degree of business de-risking

Create an efficient and functional structure for the businesses, reducing operational costs – thereby
#5
#5 increasing profitability

#6 Higher Net Worth to capitalise on future growth potential

13
 QUIPPO

World
• One of the • Provides • Provides • Provides eco- • Provides
Quippo Oil & Gas

ppo Construuction
Quippo Telecom

Rental

Valuation & Asset Disposal

largest state-of- equipment on friendly gas- online &
i d
independ-
d

Quippo Energy R
the-art rentals based power offline
ff
ent tower drilling alongwith solutions for auctioning &
company in trained, short to disposal
the world equipment
along with qualified & medium term service for
• About experienced plant &
Q

• Provides gas-
gas
Quip
40,000 # qualified
lifi d
operators operators based machinery
telecom
towers combined
heat solutions

India’s 1st
India’s 1st Tower India’s 1st Integrated India’s 1st Equipment India’s 1st Energy Comprehensive
Rental Company Rig Rental Services Rental Company Rental Company Equipment & Industrial
Valuer
# 31st March’10
14
Quippo Infrastructure Equipment Limited(QIEL)
- An Overview

ƒ QIEL primarily acts as the holding company for Quippo Group’s businesses in
infrastructure equipment space.
ƒ QIEL business structure

15
Telecom Infrastructure Business

ƒ Quippo Telecom Infrastructure Limited (QTIL) owns and operates the telecom tower business of
the Group

ƒ In January 2009
2009, QTIL and Tata Group announced an amalgamation and partnership,
partnership under which:

ƒ QTIL and its shareholders would purchase stake in Tata Group company Wireless TT
Infoservices Limited (WTTIL) from existing shareholders : This was completed in August
2009

ƒ Subsequently, the tower assets of QTIL would be demerged, and merged with WTTIL, and
shares in WTTIL would be issued to shareholders of QTIL as consideration

ƒ The scheme on the merger has been filed with respective high court(s) and pending
necessary approvals. The Appointed Date for the merger is 1st April 2009

ƒ As of 31st March 2010, the two companies are expected to have a combined portfolio of
~40,000 towers with tenancies of approx 2.0x

ƒ Quippo’s effective economic interest in WTTIL (directly and indirectly) after the demerger, would
be approx 9%, and which, combined with Srei’s holding in WTTIL, would amount to approx 11.50%
stake in WTTIL. Total asset size by March 2010 ~Rs 9,800 cr

ƒ Expected to have ~ Rs 5000 cr to 5400 cr of term loans and borrowings by March 2010.

ƒ Expected revenues of ~Rs 1652 cr and projected EBITDA of ~ Rs 900 cr by March 2010
16
Construction Equipment Rental Business
ƒ Provides construction equipment rental services, along with trained and qualified operating
personnel to customers

ƒ Also has a subsidiary NAC Infrastructure Equipment Limited (NACIEL) in a joint venture with L&T
Finance Limited, which also operates in a similar field in four southern states i.e. Tamil Nadu,
Andhra Pradesh, Karnataka and Kerala.

ƒ Has a fleet size of ~700 equipment across 7 locations in India, including earthmoving and general
construction
t ti equipment,
i t soil
il improvement
i t equipment,
i t roadd construction
t ti equipment,
i t concrete
t
equipment, transport equipment and lifting equipment

ƒ The business is in a consolidation phase – changing its focus from low value retail assets to high
value assets,, which is expected
p to drive revenue and EBITDA margin
g growth
g going
g g forward.

Financial Snapshot of FY 09
Details In Rs Cr
Revenue 57
EBITDA 12
Asset Base 339
Debt 184

17
Energy Rental Business

ƒ The business relates to renting of power generation equipment and heat recovery add-on
equipment to SME customers.

ƒ Value proposition driven by alternative to "buy" in the area of gas based power generation to
users by putting together containerized equipment to generate power, heat and cooling solutions
driving reliability and innovation on a 24/7 basis

ƒ IIn addition
dditi tto equipment,
i t QEPL also
l provides
id access tto k
know-how
h and
d supportt through
th h it on-
ground personnel who operate the equipment.

Financial Snapshot of FY 09
Details In Rs Cr
Revenue 21
EBITDA 13
Asset Base 83
Debt 47

18
Oil & Gas Infrastructure Business

ƒ QOGIL, directly and through subsidiaries and JVs, operates 4 oil rigs and 1 barge (barge held
through a JV, Quippo Prakash Pvt. Ltd. (QPPL) in which QIEL has an effective stake of ~ 38%).
Th
These assets
t are provided
id d on long-term
l t lease
l contracts
t t to t customers,
t along
l with
ith operating
ti
personnel and know-how

ƒ QPPL has an expected total asset base of ~ USD 122 mn as of FY2010E (with loans of ~ USD 97
mn)

ƒ QOGIL has been awarded an Oil Block CB-ONN-2005/11 (NELP VII Round) for exploration and
production in Cambay Basin, Gujarat.

Financial Snapshot of FY 09
Details In Rs Cr
Revenue 20
EBITDA 5
Asset Base 90
Debt 64

19
Valuation & Asset Disposal Business

ƒ Is a 50:50 joint venture with GoIndustry (UK), Ltd.

ƒ Has three major lines of services:

ƒ Auction services for disposal of construction equipment, commercial vehicles and

passenger cars; also offers services for valuation of construction equipment and
motor vehicles

ƒ Auction services for disposal of all other equipment and tools including machine tools,
textiles machinery, food processing equipment etc.

ƒ Consulting services for valuation and appraisal of above assets, asset management,
market
k t commentary
t etc.
t ffor clients
li t

ƒ The JV has an equity base of Rs 0.2 cr and is a fee based business with an expected
Revenue of Rs 3.2 cr by March 2010.

20
Transaction Details

• Srei Infrastructure Finance Limited (“Srei”) is proposing an amalgamation of Quippo

Infrastructure Equipment Limited (“QIEL”) to create a single focused entity to capitalize on the
infrastructure development opportunities in the country (“Transaction”)
• Appointed date for the merger is April 1, 2010
• Timeline: Expect to complete by Q2-FY11

Shareholding Pattern post Merger*

Treasury Stock, 9.66%
Domestic Venture
Capital, 11.52% Promoters
Mutual Funds
NRIs / OCBs, 2.71% FIIs
Promoters, 46.22%
Private Corp Banks & Others
Bodies, 3.50%
Indian Public
GDRs 0.11%
GDRs, 0 11%
GDRs
Private Corp Bodies
Indian Public, 6.91% FIIs, 14.42%
NRIs / OCBs
Domestic Venture Capital
Banks & Others, 0.06%
Treasury Stock

Mutual Funds, 4.88%

* Assuming shareholding of SIFL as on 31st December 2009
21
Transaction Details
• The consideration to the shareholders of QIEL would be through issue of shares in Srei
• Valuers have recommended a share swap ratio of 3:2, i.e., 3 shares of Srei to be issued for every 2 shares held
in QIEL, while the Fairness Opinion providers have provided a fairness opinion certifying this ratio to be fair
• Treasury stock created against 16.85% stake in QIEL held by Srei prior to the merger
• Key Advisors for the transaction include:
¾ Transaction Advisors: Kotak Mahindra Capital Company Limited; DBD Business Solution (P) Ltd
¾ Fairness Opinion: ICICI Securities Limited (to Srei); JM Financial Consultants Pvt
Pvt. Ltd
Ltd. (to QIEL)
¾ Valuation Report: KPMG India Private Limited; BDO Haribhakti Consulting Private Limited
¾ Legal Advisors: Amarchand & Mangaldas & Suresh A. Shroff & Co.
¾ Due Diligence: Ernst & Young Pvt. Ltd.; Amarchand & Mangaldas & Suresh A. Shroff & Co.
• Further, Srei proposes to issue 4 bonus equity shares each for every 5 equity shares held by its shareholders,
as on the Record Date under the Scheme of Amalgamation. The bonus shares will be issued to shareholders of
Srei prior to Amalgamation. The swap ratio will be adjusted accordingly
• Share issue workings:

Srei Current Shares Outstanding 11.6 cr

QIEL Expected Shares Outstanding* 10.9 cr
Srei shares outstanding post bonus 20.9 cr
N
New iissuance att Srei
S i expected
t d due
d tto amalgamation
l ti ((adjusted
dj t d swap postt b
bonus)) 29 4 cr
29.4
Srei shares outstanding post amalgamation, post-bonus 50.3 cr
* Post conversion of convertible debentures into2.05 mn equity shares in QIEL

22
FINANCIALS
Financial Statement – Q3 FY10
Srei Infrastructure Finance Limited (Consolidated)
Fig in Rs Crs Quarter Ended Nine months ended
Disbursement
Income Statements Details 31 Dec’09 31 Dec’08 31st Dec’09 31st Dec’08
st st

for the Qtr

Income from finance activities 241.84  164.80  622.25  553.26 
Rs 2
2,000
000 cr 136.35  129.14  370.41  359.98 
Finance charges
578% NII 105.49  35.66  251.84  193.28 
Fee based income 8.30  1.82  16.86  73.47 
Oth Income
Other I 7 41
7.41  10 32
10.32  29 58
29.58  19 37
19.37 
Disbursement
Total Income 121.20  47.80  298.28  286.12 
YTD
Operating Expenditure (incl. depreciation) 46.08  27.64  130.39  149.50 
Rs 6,168 cr
Provisions 7.18
7.18  4.79
4.79  17.89
17.89  15.18
15.18 
PBT 67.94  15.37  150.00  121.44 
25% 22.63  6.64  40.50  42.89 
Tax
PAT 45.31  8.73  109.50  78.55 
Assett U
A Under
d Key Indicators Q3 FY 10 Q3 FY 09
Management 5.14% 3.56%
NIM %
Rs 12,162 cr ROE 19.87% 13.10%
Leverage 4 70
4.70  3 55
3.55 
21% EPS (Rs) 12.59  8.97 

24
Financial Statement – Q3 FY10
Srei Infrastructure Finance Limited (Standalone)
Fig in Rs Crs Quarter Ended Nine months ended
Disbursement
Income Statements Details 31 Dec’09 31 Dec’08 31 Dec’09 31st Dec’08
st st st

for the Qtr

Income from finance activities 116.41  38.93  281.40  169.63 
Rs 431 cr Finance charges 68.54  41.46  155.08  117.37 
NII 47.87  ‐2.48  126.32  52.26 
74% 5.81  15.82  10.41  63.26 
Fee based income
Other Income 5.07  3.16  11.37  20.66 
Total Income 58.75  16.50  148.10  136.18 
Disbursement
Operating Expenditure (incl. depreciation) 15.91  12.53  45.46  60.72 
YTD
Provisions 0.00  0.00  0.00  0.00 
Rs 2,266
, cr PBT 42 84
42.84  3 97
3.97  102 64
102.64  75 46
75.46 
Tax 14.34  1.62  22.53  24.66 
211% PAT 28.50  2.35  80.11  50.80 
Key Indicators Q3 FY 10 Q3 FY 09
Assett U
A Under
d NIM % 5.68% 3.83%
Management Gross NPA ‐ ‐
Rs 3,890 cr Net NPA ‐ ‐
ROE 14.53% 9.91%
Leverage 3.92  1.78 
92% EPS (Rs) 9.20 5.83

25
Thank You

Srei Infrastructure Finance Limited Phone: +91 33 3988-7734

‘VISHWAKARMA’ Fax: +91 33 2285 7542 / 8501
86C, Topsia Road (South), corporate@srei.com
Kolkata – 700 046, INDIA www.srei.com