braveheart series - jaiprakash associates-the wheel of ... real estate jaypee greens real estate‐...

Jaiprakash AssociatesThe wheel of fortune

Aashiesh Agarwaal, CFA+91 22 4063 5491

hi h l@ d l

O b 2012

[email protected]

October 2012

Investment Rationale

• Stock presents 78% upside from CMP: The Jaiprakash Associates (JPA) stock presents 78% upside against CMP of INR82/share, powered by earnings growth; assuming an EV/EBITDA multiple close to 5‐year low

• EV to surge to ~INR855bn in FY14E from ~INR721bn in FY13E

• EBITDA surges 99% to INR107bn in FY15E from INR54bn in FY12 driven by power and cement

• Debt to peak in FY13/14 as most of the planned capex has been commissioned

• We estimate JPA to generate INR290bn from its operations over FY13 15E—broadly split• We estimate JPA to generate INR290bn from its operations over FY13‐15E—broadly split among real estate, cement and power assets—against interest obligations of INR157bn over same period

• Equity value jumps to ~INR304bn from INR171bn, a 78% increase

• EV/EBITDA assumed at near 5‐year low for our target price!

• Scaled up to one of the largest infrastructure players in its key segments: JPA has emerged as the third largest cement manufacturer, largest real estate developer, largest private hydro power generation company operator of India’s longest expressway and the only owner of F1 sports track ingeneration company, operator of India s longest expressway and the only owner of F1 sports track in the country

• Proven track record of strong execution capability and on‐time delivery: JPA has a proven execution record of developing world‐class assets with commendable timeliness given the operating

i tenvironment

• Additional triggers:

• Debt reduction: The company has guided to asset sales / debt reduction of INR100bn over the next 6‐12 months. We have not assumed any of these in our estimates. Any progress on this front will be an y y p gadditional trigger for the stock 2

Strong upside

Stock presents robust upside

• The stock is trading at historically low valuation multiples driven by weak debt servicing metrics

• EBITDA to catapult 38% over FY13E‐15E driven by cement and power businesses, which will drive EV expansion over forecast period

• At current trough valuation multiples, the stock presents 78% upside from CMP

• Improvement in debt servicing metrics due to operationalisation of assets to drive re‐rating of multiples, which will provide further upsides

Debt increases

Debt stable

FY08‐12: Story so far FY13‐15E: What future holds

Mcap crashed

EBITDA rise slower

Execution concerns

heighten risk perception

Stock performance

EBITDA surging

Execution concerns abate

EV/EBITDA declines

EV/EBITDA stable to rising

4

g

Stock trading at historically low valuation multiples

EV/EBITDA EV/EBITDA range

2 0

32.0

40.0

A)

36.0

45.0

8.0

16.0

24.0

(EV/EBITDA

9.0

18.0

27.0

(%)

P/CEPS P/CEPS range

0.0

Apr‐07

Aug

‐07

Dec

‐07

Apr‐08

Aug

‐08

Dec

‐08

Apr‐09

Aug

‐09

Dec

‐09

Apr‐10

Aug

‐10

Dec

‐10

Apr‐11

Aug

‐11

Dec

‐11

Apr‐12

Aug

‐12 0.0

7 ‐ 8 8 ‐ 9 9 ‐ 10 10 ‐ 11 11 ‐ 12 12+

3 year distribution 5 year distribution

52

68

84

EPS)

9 6

12.8

16.0

19.2

%)

3

19

35

7 7 7 8 8 8 9 9 9 0 0 0 1 1 1 2 2

(P/CE

0.0

3.2

6.4

9.6 (%

• EBITDA to surge 38% over FY13E‐15E driven by cement and power businesses, which will drive EV

Source: Bloomberg, Edelweiss research

Apr‐07

Aug

‐07

Dec

‐07

Apr‐08

Aug

‐08

Dec

‐08

Apr‐09

Aug

‐09

Dec

‐09

Apr‐10

Aug

‐10

Dec

‐10

Apr‐11

Aug

‐11

Dec

‐11

Apr‐12

Aug

‐12

6 ‐ 7 7 ‐ 8 8 ‐ 9 9 ‐ 10 10 ‐ 11 11 ‐ 12 12+

3 year distribution 5 year distribution

expansion over forecast period at constant valuation multiples5

EBITDA to catapult 38% over FY13E‐15E

EBITDA EV/EBITDAEBITDA EV/EBITDA

72 000

96,000

120,000

) 15 0

20.0

25.0

A)

24,000

48,000

72,000

(INR mn

5.0

10.0

15.0

(EV/EBITDA

Enterprise Value MCAP rises as Debt stabilizes

0FY 08 FY 09 FY 10 FY 11 FY 12 FY 13E FY 14E FY 15E

1 000 000

0.0 FY 08 FY 09 FY 10 FY 11 FY 12 FY 13E FY 14E FY 15E

600 000

600,000

800,000

1,000,000

mn)

360,000

480,000

600,000

mn)

Mcap surge driven by strong earnings

0

200,000

400,000 (INR

0

120,000

240,000

FY08 FY09 FY10 FY11 FY12 FY13E FY14E FY15E

(INR m earnings

growth


• Headwinds turn into tailwinds as most planned capex gets commissioned and EBITDA expands

0 FY 08 FY 09 FY 10 FY 11 FY 12 FY 13E FY 14E FY 15E

FY 08 FY 09 FY 10 FY 11 FY 12 FY 13E FY 14E FY 15E

MCAP Net Debt

6• Headwinds turn into tailwinds as most planned capex gets commissioned and EBITDA expands

Valuation summary: Earnings based

FY10 FY11 FY12 FY13E FY14E FY15ESales 65,256 112,593 147,732 205,984 245,027 285,427 Sales growth (%) 72.5 31.2 39.4 19.0 16.5 EBITDA 21,917 47,397 53,645 77,532 91,087 106,927 EBITDA growth 116.3 13.2 44.5 17.5 17.4 PBT 20,127 25,891 16,260 8,704 21,799 38,956 PAT 11,192 13,823 6,329 558 9,707 19,433 PAT growth 23.5 (54.2) (91.2) 1,639.5 100.2 EPS 5.3 6.5 3.0 0.3 4.6 9.1 EPS growth 23.4 (54.2) (91.2) 1,639.5 100.2 CEPS 7 9.5 7.5 7.7 13.4 20.3 CEPS growth 27.4 (21.9) 2.9 74.5 51.7 BVPS 40.0 50.7 54.0 52.6 54.8 59.8 BVPS growth 26.6 6.5 (2.6) 4.3 9.1 Net Debt 267,859 376,264 503,137 557,865 558,650 549,787

3 3 9 333 3 30 286 286 286MCAP 317,737 197,333 173,730 171,286 171,286 171,286 EV 585,596 573,597 676,866 729,150 729,935 721,072 EV/EBITDA 12.4 10.7 8.7 8.0 6.8

Particulars FY14EEBITDA 106,927EBITDA 106,927 EV/EBITDA(x) 8 EV 855,420 Debt 558,650 Less: FCCB conversion (8,025) Net Debt 550,625 MCAP (A) 304,794 no. of shares* 1,970 Add: FCCB conversion 108 Total no. of shares(B) 2,077 Target Price (A/B) 147 Source: Edelweiss research *ex‐treasury shares

7

Valuation summary: SOTP

/ ( ) /SEGMENT Valuation rationale EV/EBITDA (x)

(x) INR mn INR/share

Standalone EVCement 8x EV/EBITDA multiple to FY15 earnings 25,740.0 8 205,920 53

Construction FY14E EV/EBITDA of 5x 9758 5 48,789 13Real Estate Jaypee Greens real estate‐ NPV 20,755 5Hospitality Hotels at 6x FY13E EV/EBITDA 2,796.8 6 16,781 4Wind Power At capital employed 21,637 6

Total standalone EV 313,882FY14E net debt 145,815Target standalone equity Value 168,068 81

Jaypee Infratech Real estate 101,501BOT‐Yamuna Expressway 1,577Tolling rights‐Noida Greater Noida Espressway (1,032)

JAL's stake in Jaypee Infratech 83.10%Holding company disount 20%Jaypee Infratech for JAL 67,841 33

Jaiprakash Power Ventures Ltd Equity valueTotal Equity Value of JPVL 89,087JAL's stake in JPVL 78.2%Holding company disount 20%JPVL value for JAL 55,749 27

Jaypee South and West Cement Capacities 9.8 mtpa at replacement cost at USD 110/t 10 110 56,056

Cement Less: Debt 35,000,Equity value 21,056Holding company disount 20%JCCL value for JAL 16,845 8

Jaypee Sports City, Gr. Noida 5,828JPSI stake 91%Holding company disount 20%g p yJPSI value for JAL 4,220 2

Jaypee Himalayan Expressway Book Value 2,345JAL's stake in JHL 100%Holding company disount 20%JHL for JAL 1,876 1TOTAL JAL EQUITY VALUE 297,752 151

Source: Edelweiss research 8

Improvement in debt service metrics to drive re‐rating

• Between FY08 and FY12, JPA’s net debt rose sharply while EBITDA lagged

• EV/EBITDA and net debt / EBITDA depict an inverse relationship

• Going forward, we expect debt to remain stable as most of the assets have been commissionedg , p

• EBITDA likely to surge 38%, helping net debt / EBITDA correct sharply

• Stronger cash flows and abated execution concerns can potentially drive re‐rating

• Our target does not take into account any potential of re‐rating

EBITDA and debt: A tale of two halves Possible re‐rating of EV/EBITDA as debt/EBITDA declines

Our target does not take into account any potential of re rating

14.025.0 120,000600,000

5.6

8.4

11.2

10.0

15.0

20.0

bt/EBITD

A)

V/EBITDA) ?

48,000

72,000

96,000

240,000

360,000

480,000

NR mn)

(INR mn)

0.0

2.8

0.0

5.0

FY 08

FY 09

FY 10

FY 11

FY 12

FY 13E

FY 14E

FY 15E

(De

(EV

/ /

0

24,000

0

120,000

FY 08

FY 09

FY 10

FY 11

FY 12

FY 13E

FY 14E

FY 15E

(I N

(

Sensitivity analysis indicates comfortable cushion


EV/EBITDA Debt/EBITDANet Debt EBITDA (RHS)

Sensitivity analysis indicates comfortable cushion

9

Sensitivity analysis: Favourable risk‐reward

• Our scenario analysis indicates a valuation range of INR70–186 based on:

• 7% variation in EBITDA driven by variation in cement volumes / margins

• Cement volumes range of 26‐32 tonnes and 20% variation in EBTIDA/tonne• Cement volumes range of 26‐32 tonnes and 20% variation in EBTIDA/tonne

• EV/EBITDA range of 7.4‐8x

• Net debt overshooting our estimate by INR100bn

• At CMP, downside is 15% while upside is 125%, indicating risk‐reward in favour

Sensitivity of target price to EBITDA and EV/EBITDA Sensitivity of price to variation in Debt levels (constant EV/EBITDA)

147 7.4 8.0 9.0 10.0 11.0 99,447 90 118 166 214 262

103 187 104 132 182 232 281TDA

EV/EBITDA multiple147 650,625 600,625 550,625 500,625 450,625

99,447 70 94 118 142 166 103 187 84 108 132 156 180TD

A

Net Debt


103,187 104 132 182 232 281 106,927 117 147 198 250 301 111,987 135 166 220 274 328 117,047 153 186 242 298 355

EBIT 103,187 84 108 132 156 180

106,927 99 123 147 171 195 111,987 118 142 166 190 214 117,047 138 162 186 210 234

EBIT

10

EBITDA set to surge

EBITDA to catapult

• EBITDA is likely to surge 99% between FY12 and FY15E, 26% CAGR

• Diversified earnings stream; no division contributes more than 40% to EBITDA

• KarchamWangtoo and new cement capacities will add to EBITDA in FY13/FY14• Karcham Wangtoo and new cement capacities will add to EBITDA in FY13/FY14

• Bina/Nigrie thermal power plants will add to EBITDA in FY15

• Real estate remains a steady contributor

EBITDA surge led by hydro power, real estate and cement

120,000

72,000

96,000

NR mn)

0

24,000

48,000(IN

Assets well positioned to post strong earnings growth

Source: Company, Edelweiss research

0FY08 FY09 FY10 FY11 FY12 FY13E FY14E FY15E

Hydro Power Thermal Power Real Estate Cement others

Assets well positioned to post strong earnings growth

12

Well positioned assets

Asset wise features

Cement Real estate Hydro power Thermal power

Third largest player in India Largest land bank in NCR amongst 1 700 MW of operational hydro 500 MW operational withThird largest player in India

Volume CAGR at 33% for the past 5 years, leading the industry

Emerged as a pan–India player with

Largest land bank in NCR amongst all real estate players

Established brand and credentials—sold 68 msf and collected INR78 bn over past 3 years, more than any

1,700 MW of operational hydro power assets

Design energy of 7600 MW in 50% dependable year

500 MW operational withadditional 3300 MW under various stages of construction

Overall 74% to be sold under PPA with 26% to be sold on merchant

commissioning of South capacities

EBITDA of INR 72 bn over FY13‐15E

Cash generation of INR 74 bn over FY13‐15E

other in the country

632msf of developable area still in inventory

Balance land parcels along the high‐

Assured RoE projects with incentives for higher plant availability / secondary generation

Plant availability historically at 99%

basis


Operating cash generation of INR 26 bn between FY13E and FY15EFY13 15E Balance land parcels along the high

growth corridor of the newly commenced Yamuna Expressway and largely part of the Jaypee Sports City

EBITDA f INR 103 b FY13

Generation well over the design capacity historically


C h ti f INR 54b

26 bn between FY13E and FY15E

Operating cash generation of INR 114 bn between FY16E and FY18E


Cash generation of INR 67bn over FY13‐15E

Cash generation of INR 54bn over FY13‐15E


13

Debt to stabilise

Debt to stabilise

• Operational cash flows of INR 290 bn over FY13‐15E

• Capex of INR 176 bn over FY13‐15E

• Yamuna Expressway, 250 MW Bina unit 1, 5 MTPA cement plant in Balaji was commissioned in H1FY13Yamuna Expressway, 250 MW Bina unit 1, 5 MTPA cement plant in Balaji was commissioned in H1FY13

• 250 Bina unit 2, 2.6 MTPA cement grinding plant, 1,320 MW Nigrie TPP to be commissioned in H2FY13–FY15E

• 1,980MW Bara TPP to be commissioned in FY16E

Debt to stabilise FY13 onwards

• Interest payment of INR157bn

480,000

600,000

120 000

240,000

360,000

(INR mn)


0

120,000

FY 08 FY 09 FY 10 FY 11 FY 12 FY 13E FY 14E FY 15E


15

FY12‐H1FY13: Most planned capex commissioned

• 1,000MW Karcham Wangtoo HEP

• Fomula 1 racing track

• 214km power transmission line between Abdullapur and existing Baspa – Jhakri double circuit link• 214km power transmission line between Abdullapur and existing Baspa Jhakri double circuit link

• Enhanced cement capacity 3.3x over past 5 years

• INR133bn 165 km 6‐lane access controlled Yamuna Expressway

• 500MW Bina thermal power project

Projects commissioned in FY12/FY13Project Size Completion Cost (INR bn)Karcham Wangtoo hydro‐electric plant 1000 MW H1FY13 69Bina thermal pwer plant 500 MW Q2FY13/Q3FY13 32.4Jaypee power grid 214 km transmission project Q4FY12 10Yamuna Expressway 165 km 6‐lane concrete expressway Q2FY13 133Formula‐1 race track 5.14 km track with an initial seating

capacity of 110,000Q3FY12 17

B l ji t l t 5 MTPA Q1FY13 38 5


Balaji cement plant 5 MTPA Q1FY13 38.5Grinding units ‐ Bokaro, Baga, Bhilai, Sikandarabad

6.3 MTPA Q1FY13 18.9

318.8

Financially closed projects Nigrie Bara to drive balance capex over FY13 1516

Financially closed projects—Nigrie, Bara—to drive balance capex over FY13‐15

JPA to start generating cash FY14 onwards

Operating cash flows to expand Capex reduces as assets get commissionedOperating cash flows to expand Capex reduces as assets get commissioned

84,000

112,000

128,000

160,000

0

28,000

56,000

(INR mn)

32,000

64,000

96,000

(INR mn)

Interest payments remain stable Debt levels stabilize

(28,000)FY08 FY09 FY10 FY11 FY12 FY13E FY14E FY15E

60 000

0 FY08 FY09 FY10 FY11 FY12 FY13E FY14E FY15E

36,000

48,000

60,000

mn) 360,000

480,000

600,000

R mn)

12,000

24,000 (INR m

120,000

240,000 (IN

Estimated to generate INR290bn operating cash between FY13 and FY15 driven by hydro power, real




estate and cement 17

Hydro power, cement, real estate to drive cash flows

• Cement to contribute INR74bn over FY13‐15E

• Thermal power to contribute INR26bn over FY13‐15E

• Hydro power to contribute INR53bn over FY13 15E• Hydro power to contribute INR53bn over FY13‐15E

• Real estate to contribute INR67bn over FY13‐15E

Assets well positioned to generate robust cash flows25 000 25 000

10,000

15,000

20,000

25,000

INR mn)

Hydro power

10,000

15,000

20,000

25,000

(INR mn)

Thermal power

0

5,000

,

FY12 FY13E FY14E FY15E

(

0

5,000


18,000

24,000

30,000

R mn)

Real Estate

18,000

24,000

30,000 mn)

Cement

0

6,000

12,000


(INR

0

6,000

12,000

FY10 FY11 FY12 FY13E FY14E FY15E

(INR m

Source: Company, Edelweiss research18

Scaled up to one of the largest infrastructure players in key segments

Scaled up to one of the largest players in key segments

Owner‐operator of India’s longest expresswayProject Length (km) Current ownership Year of completionYamuna Expressway 165 Jaypee Infratech completed in 2012Western Peripheral Expressway 136 DS Construction ‐ Apollo Enterprises Under DevelopmentEastern Peripheral Expressway 135 Proposed Proposedh d b d d d f i i l d i

Largest real estate area sold in the past 3 years

Ahmedabad Vadodara Expressway 95 IRB Infra Initial ‐ 2004, Current Upgradtion ‐ FY16EMumbai Pune Expressway 93 IRB Infra completed in 2002Delhi‐Gurgaon Expressway 28 DS Construction completed in 2008Delhi Noida Direct Flyway 9 Noida Toll Bridge Company completed in 2001

Largest private producer of hydro‐power in the country

Project MW Program ActualJaiprakash Power Ventures 1,700 4,225 6,093 Tata Power Company 447 1,450 1,531

FY 12 Generation

16.0

24.0

32.0

40.0

(msf)

LNJ Bhilwara 378 1,236 1,065 Bhandardhara 34 58 117 Total 2,559 6,969 8,806

3rd largest cement capacity in the countryL l d b k i h

0.0

8.0

JPA DLF GPL Unitech Prestige SobhaFY 10 FY 11 FY 12

FY08/ FY09/ FY10/ FY11/ FY12/CY07 CY08 CY09 CY10 CY11

Ambuja‐ACC 44.8 41.1 48.2 55.0 57.0 Ultratech 18.2 21.9 23.5 48.8 48.8 Jaiprakash Associates 9.0 13.5 22.8 26.2 28.3 I di C t 8 8 13 0 14 1 14 1 14 1

Largest land bank in the country

420

560

700

f)

Rapid attainment of scale a testimony to robust

India Cements 8.8 13.0 14.1 14.1 14.1 Shree Cements 9.0 10.0 10.2 13.5 13.5

0

140

280

JPA DLF GPL Prestige Sobha

(ms

Source: Company, Edelweiss research 20

ap d atta e t o sca e a test o y to obustexecution capability

JPA DLF GPL Prestige Sobha

Proven track record of strong execution capability

Indicative list of projects

Project Characteristics Client Scope of workSardar Sarovar Dam: Largest concrete dam in I di

1.2km long concrete gravity damA proposed final height of 163m against

t h i ht f 121 9

SSNN, Gujarat Main dam and power house

India current height of 121.9mIts construction required pouring of about 7 mn cubic metres of chilled concreteIt is expected to supply water for irrigation to 1.84 mn ha across 15 districts and 73 suburbsIt is also expected to supply drinking water to 29 i h bi 131 d 9 63329 mn inhabitants across 131 towns and 9,633 villages in Gujarat

Tehri Dam: Largest rockfill dam in India

Tehri Dam is the third tallest rockfill dam in the world and the largest in Asia

THDC, Uttranchal Rockfill dam and spillways

Nathpa‐Jhakri: Largest A 1,500MW power house is the largest SJVNL, Himachal Pradesh Power house and penstocksunderground powerhouse in India

underground power house in India

Yamuna Expressway: India’s longest 6 lane access controlled

Power house and penstocks JPIN, Uttar Pradesh JPA’s 83.1% subsidiary – JPIN is owner and JPA is the EPC contractor

concrete expressway


21

Timeliness commendable in operating environment

Tracking delivery v/s guidanceTracking delivery v/s guidancePower projects May‐09 Aug‐09 Nov‐09 Mar‐10 Sep‐10 Feb‐11 May‐11 Nov‐11 Jan‐12 Jun‐12 Aug‐12 CommentsKarcham Wangtoo 2011 2011 2011 2011 2011 2011 2011 2011 2011 2011 2011 Commissioned in Sep 2011Bina 2011 2011 2011 2011 2011 2011 2011 2012 2012 2012 2012 Commissioned in June 2012Nigrie 2012 2013 2013 2013 2013 2013 2013 2013 2013 2013 2013 Maintaining guidance of 2013

i i icommissioningKannur NM NM NM NM 2013 NM NM NM NM NM NMBara 2014 2014 2014 2014 2014 2014 2014 2014 2014 2014 2014 Maintaining guidance of 2014

commissioningKarchana 2014 2014 2014 2014 2014 2014 2014 2014 2014 2016 2016 Suspended due to land

acquisition issuesacquisition issuesLower Siang 2015 2015 2015 2017 2016 2016 2016 2016 2016 2017 2017 Under planningHirong 2015 2018 2018 2018 2018 2018 2018 2018 2018 2019 2019 Under planningKynshi ‐ Stage ‐ II 2016 2018 2018 2018 2019 2019 2019 2019 2019 2019 2019 Under planningUmngot ‐ Stage ‐ I 2016 2018 2018 2018 2019 2019 2019 2019 2019 2020 2020 Under planning

Cement May‐09 Aug‐09 Nov‐09 Mar‐10 Sep‐10 Feb‐11 May‐11 Nov‐11 Jan‐12 Jun‐12 Aug‐12Capacity target2008 9.0 9.0 9.0 9.0 9.0 9.0 9.0 9.0 9.0 9.0 9.02009 13.5 13.5 13.5 13.5 13.5 13.5 13.5 13.5 13.5 13.5 13.52010 24.3 22.8 22.8 22.8 22.8 22.8 22.8 22.8 22.8 22.8 22.8 Achieved 22.8 MTPA capacity 20 26 8 29 29 3 33 6 26 2 26 2 26 2 26 2 26 2 26 2 hi d 26 2 i

S C Ed l i h

2011 26.8 29.7 29.7 31.5 33.6 26.2 26.2 26.2 26.2 26.2 26.2 Achieved 26.2 MTPA capacity in Feb 2011

2012 33.5 33.5 35.5 33.6 37.6 35.9 35.9 35.9 35.9 28.3 28.3 Achieved 33.6 MTPA capacity in June 2012

2013 35.9 35.9

• Other key projects commissioned—Yamuna Expressway with a 10 month delay, due to farmer violence in the vicinity


• Formula 1 race track delivered on time for India’s maiden F1 race22

Annexures

Debt profile (consolidated)

Debt repayment of ~INR252bn and interest of ~INR166bn due during FY13‐15E

FY13E FY14E FY15E FY13E‐15EJPA standalone 210,387 53,255 36,609 41,650 131,514 Debt Book value

Annual repayment shedule

, , , , ,Jaypee Infratech 71,096 4,561 4,561 4,561 13,683 JPVL 174,173 24,411 16,260 33,311 73,981 others 76,086 10,869 10,869 10,869 32,608 Total 531,743 93,096 68,299 90,391 251,787 InterestJPA standalone 22,391 22,879 21,634 66,903 Jaypee Infratech 8,015 7,488 6,961 22,464 JPVL 17,947 18,843 18,299 55,088 others 8,478 7,174 5,870 21,522 Total 56,832 56,384 52,762 165,977


Operating cash flows of INR290bn between FY13E and FY15E to service interest payments

24

Debt servicing (Standalone)

Debt servicing

Debt Book value FY13E FY14E FY15E FY13E‐15ENon Convertible Secured Debentures 47,550 6,950 12,247 13,617 32,814 Secured Term Loans from Banks Financial Institutions & Others are given as under 95 246 9 583 13 832 16 957 40 373

Annual repayment shedule

Secured Term Loans from Banks, Financial Institutions & Others are given as under 95,246 9,583 13,832 16,957 40,373 Loan from State Government [Interest Free] 2,189 ‐ ‐ 547 547 Advance from clients 61 61 ‐ ‐ 61 Foreign Currency Convertible Bonds 18,284 26,997 ‐ ‐ 26,997 Foreign Currency Loans from Banks [ECB] 13,487 2,524 3,389 3,389 9,302 Unsecured loans From Banks 2,377 340 340 340 1,019Unsecured loans From Banks 2,377 340 340 340 1,019 Fixed Deposits Scheme 20,401 6,800 6,800 6,800 20,401 Add: Short Term Borrowings 10,793 ‐ ‐ ‐ ‐ Total 210,387 53,255 36,609 41,650 131,514 InterestNon Convertible Secured Debentures 4,608 3,699 2,381 10,689 Secured Term Loans from Banks, Financial Institutions & Others are given as under 11,580 10,112 8,213 29,906 ECB 803 619 416 1,838 Unsecured loans From Banks 287 244 202 732 Fixed Deposits Scheme 2,338 1,488 638 4,463 Total 19,616 16,162 11,849 47,627 Add I t t fi d d bt 2 775 6 717 9 785 19 277


Add: Interest on refinanced debt 2,775 6,717 9,785 19,277 Total Interest payment 22,391 22,879 21,634 66,903

25

Debt servicing (JPVL)

• Strong INR53bn cash flow from 1,700MW hydro power projects

• Bina and Nigrie TPPs to contribute INR27bn

• Capex and interest payments to result in outflow of INR195bn

• Additional funding requirement of INR9bn between FY13E and FY15EJVPL

Debt Book value FY13E FY14E FY15E FY13E‐15ENon Convertible

Annual repayment scheduleCash Flow Summary FY13E FY14E FY15E TotalHydro power

Baspa 2,388 2,099 1,915 6,402 Series ‐ I 10,000 14,049 ‐ ‐ 14,049 Series ‐ II 9,826 ‐ 3,660 7,970 11,630

19,826 14,049 3,660 7,970 25,679

Secured Term Loans from Banks, Financial Institutions & OthersBaspa 4,242 353 353 353 1,060 Vi h

Vishnuprayag 3,677 3,523 3,523 10,723 Karcham Wangtoo 8,645 14,193 13,641 36,479 Total 14,710 19,815 19,078 53,604 Thermal powerBina 1,048 4,758 4,803 10,608 i i Vishnuprayag 14,667 1,222 1,222 1,222 3,667

Karcham Wangtoo 45,612 3,041 3,041 3,041 9,122 Bina 17,661 376 1,503 1,503 3,382 Nigrie ( Total to be drawn INR 56.7bn) 22,317 ‐ ‐ 2,835 2,835 Nigrie 8 489 ‐ ‐ 424 424

Nigrie ‐ 389 15,282 15,670 Bara ‐ I ‐ ‐ ‐ Total thermal power 1,048 5,147 20,084 26,279 Power Transmission 1,945 1,643 1,591 5,179

Emmission Reduction credits 427 390 408 1,225 T t l ti h fl 18 130 26 995 41 161 86 286 Nigrie 8,489 ‐ ‐ 424 424

Other loans 10,000 3,333 4,444 2,222 10,000 FCCB 11,000 ‐ ‐ 11,703 11,703

133,987 8,326 10,564 23,305 42,194 Add: Subsidiary debt 20,360 2,036 2,036 2,036 6,108 Total Debt 174,173 24,411 16,260 33,311 73,981

Total operating cash flows 18,130 26,995 41,161 86,286 Capex 73,300 33,040 32,880 139,220 Free cash flows to firm (55,170) (6,045) 8,281 (52,934) Debt repayments / (increase) (51,947) (17,326) (14,599) (83,872) Interest payments 9,604 11,916 17,357 38,876 Free cash flows to equity (12,826) (635) 5,523 (7,938) , , , , ,

InterestInterest ‐standalone 15,625 16,765 16,465 48,855 Interest ‐subsidiaries 2,322 2,078 1,833 6,233 Total 17,947 18,843 18,299 55,088

Free cash flows to equity (12,826) (635) 5,523 (7,938)

Source: Company, Edelweiss research26

Cash flow summary (JPIN)

Cash Flow Summary FY12 FY13E FY14E FY15E TotalReal EstateNoida 8,958 13,421 17,020 19,312 58,711 Greater Noida (675) 277 1,684 1,736 3,022 ( ) , , ,Agra ‐ (225) (54) 583 304

Yamuna Expressway ‐ (690) (3) 348 (344) Total operating cash flows 8,283 12,783 18,647 21,980 61,693 Capex 18,108 16,079 (50) ‐ 34,137 Free cash flows to firm (9,825) (3,296) 18,697 21,980 27,556


Debt repayments / (increase) (4,599) 5,473 5,473 5,473 11,821 Interest payments 8,351 8,015 7,488 6,961 30,815 Free cash flows to equity (13,577) (16,784) 5,736 9,546 (15,080)

27

Cement: Industry margins to remain stable

• Due to capacity additions, industry ultilisation is estimated to remain below 80% till FY15 (assuming 9% demand growth from FY13 to FY15).

• However, post the CCI order, the industry has shown great resilience by being able to keep prices firm. H i f FY14/FY15 bili hi h l l d i FY13Hence, we expect margins for FY14/FY15 to stabilise at higher levels expected in FY13

All India Capacity utilisation

All India‐(mn tonnes) FY09 FY10 FY11 FY12 FY13E FY14E FY15EAll India (mn tonnes) FY09 FY10 FY11 FY12 FY13E FY14E FY15EInstalled capacity at the year end‐ exit capacities 215.5 257.0 280.5 299.9 331.6 356.6 364.5Non‐operative Capacities (a) 4.9 4.6 2.8 2.8 2.8 2.8 2.8Effective Capacity (b) 199.5 230.2 270.1 296.5 314.6 350.0 367.8Operative Effective capacity ( c) = (b)‐(a) 194.6 225.6 267.3 293.7 311.8 347.3 365.0Consumption ‐ domestic (d) 177.5 196.4 207.5 221.3 241.2 263.2 287.2Consumption domestic (d) 177.5 196.4 207.5 221.3 241.2 263.2 287.2 % change YoY 8.6 10.7 5.6 6.7 9.0 9.1 9.1 Cement + clinker exports (e) 6.1 4.8 4.2 3.5 3.5 3.5 3.5Total demand (f) = (d) + (e) 183.6 201.2 211.6 224.8 244.7 266.7 290.7 % change YoY 8.3 9.6 5.2 6.2 8.8 9.0 9.0Capacity util isation (f)/ ( c ) (%) 94.4 89.2 79.2 76.6 78.5 76.8 79.7


Capacity util isation (f)/ ( c ) (%) 94.4 89.2 79.2 76.6 78.5 76.8 79.7

28

Cement cash flows – key assumptions

• We expect the company to continue to outperform the industry with volume growth of 16% CAGR between FY12‐FY15E

• While industry EBITDA / Ton is expected to remain flat, EBITDA/t for JPA is likely to increase d l d i b i i i lmoderately driven by improving operating leverage

Operating cash flow of ~INR 74bn over FY13‐15E

FY10 FY11 FY12 FY13E FY14E FY15ECapacity 19 26 28 35 36 36 Volume 9 15 18 22 26 28 EBITDA / T 1,497 869 612 900 950 1,000 EBITDA 13,693 12,696 10,845 19,711 24,424 28,280 Depreciation 3,132 4,853 6,042 7,933 8,579 9,035 EBIT 10,561 7,844 4,803 11,778 15,845 19,246 Notional Interest 9 720 18 000 19 800 21 492 21 277 21 064Notional Interest 9,720 18,000 19,800 21,492 21,277 21,064 Notional PBT 841 (10,156) (14,997) (9,714) (5,432) (1,818) Notional PAT 564 (6,805) (10,048) (6,508) (3,640) (1,218) Operating cash flowPAT 564 (6,805) (10,048) (6,508) (3,640) (1,218) Interest 9,720 18,000 19,800 21,492 21,277 21,064


, , , , , ,Depreciation 3,132 4,853 6,042 7,933 8,579 9,035 Operating cash flow before WC changes 13,416 16,048 15,794 22,916 26,217 28,881 Working Capital Changes ‐ ‐ 937 1,350 1,485 1,382 Operating cash flow after WC changes 13,416 16,048 14,857 21,566 24,732 27,498

29

Hydro power: Baspa

• The 300MW Baspa II hydro electric plant located at Himachal Pradesh is expected to generate INR6.4bn over FY13‐15E

• Commissioned in FY04, this is as assured returns project with16% RoE with incentives for higher plant availability and

180

240

300

72

96

120

(%)

MU)

16% RoE with incentives for higher plant availability and secondary energy generation. JPVL has inked a PPA with HPSEB for off take of energy from the project

• Past record of plant availability and secondary energy generation present upsides to our cash flow estimates

0

60

120

0

24

48


(M

generation present upsides to our cash flow estimates

Assumptions and operational details

Secondary energy Plant availability

Baspa FY13E FY14E FY15E FY16E FY17E FY18E FY19E FY20EPlant Capacity (MW) 300 300 300 300 300 300 300 300 Design Energy (MU) 1,213 1,213 1,213 1,213 1,213 1,213 1,213 1,213Design Energy (MU) 1,213 1,213 1,213 1,213 1,213 1,213 1,213 1,213 Primary saleable energy capacity (MU) 1,050 1,050 1,050 1,050 1,050 1,050 1,050 1,050 Approved capex 15,340 15,340 15,340 15,340 15,340 15,340 15,340 15,340 Approved equity 4,602 4,602 4,602 4,602 4,602 4,602 4,602 4,602 Plant availabil ity (%) 99 99 99 99 99 99 99 99 Generation 1,402 1,274 1,274 1,274 1,274 1,274 1,274 1,274 Net saleable energy 1,233 1,121 1,121 1,121 1,121 1,121 1,121 1,121 Revenues 3,341 2,858 2,757 2,677 2,659 2,684 2,709 2,736 EBITDA 3,036 2,534 2,413 2,313 2,274 2,275 2,276 2,277 Depreciation 660 660 660 660 660 660 660 660 EBIT 2,376 1,874 1,754 1,653 1,614 1,615 1,616 1,617 I t t 453 324 204 103 64 65 66 67Interest 453 324 204 103 64 65 66 67 PBT 1,923 1,550 1,550 1,550 1,550 1,550 1,550 1,550 Tax 635 512 512 512 512 512 512 512 PAT 1,289 1,039 1,039 1,039 1,039 1,039 1,039 1,039 RoE on approved equity (%) 28 23 23 23 23 23 23 23 Operating cash flow 2 388 2 099 1 915 1 811 1 761 1 754 1 755 1 756Source: Company, Edelweiss research

30

Operating cash flow 2,388 2,099 1,915 1,811 1,761 1,754 1,755 1,756

Hydro power: Vishnuprayag

• The 400MW‐Vishnuprayag hydro electric plant located at Uttarakhand is expected to generate INR11bn over FY13‐15E

• Commissioned in FY07 this is as assured returns project270

360

450

72

96

120

(%)

MU)

Commissioned in FY07, this is as assured returns project with 16% RoE with incentives for higher plant availability and generation of secondary energy. JPVL has inked a PPA with UPPCL for off take of energy from the project

• Past record of plant availability and secondary energy

0

90

180

0

24

48


((M

Past record of plant availability and secondary energy generation present upsides to our cash flow estimates

Assumptions and operational details

Secondary energy Plant availability

Vishnuprayag FY13E FY14E FY15E FY16E FY17E FY18E FY19E FY20EPlant Capacity (MW) 400 400 400 400 400 400 400 400 Design Energy (MU) 1,774 1,774 1,774 1,774 1,774 1,774 1,774 1,774 Primary saleable energy capacity (MU) 1,534 1,534 1,534 1,534 1,534 1,534 1,534 1,534 Approved capex 16,940 16,940 16,940 16,940 16,940 16,940 16,940 16,940 Approved equity 5,147 5,147 5,147 5,147 5,147 5,147 5,147 5,147 Plant availabil ity (%) 99 99 99 99 99 99 99 99 G ti 2 177 1 863 1 863 1 863 1 863 1 863 1 863 1 863Generation 2,177 1,863 1,863 1,863 1,863 1,863 1,863 1,863 Net saleable energy 1,916 1,639 1,639 1,639 1,639 1,639 1,639 1,639 Revenues 3,441 3,292 3,143 2,994 2,198 2,061 1,925 1,789 EBITDA 3,183 3,030 2,877 2,725 1,914 1,761 1,608 1,455 Depreciation 1,186 1,186 1,186 1,186 254 254 254 254 EBIT 1 997 1 844 1 692 1 539 1 659 1 507 1 354 1 201EBIT 1,997 1,844 1,692 1,539 1,659 1,507 1,354 1,201 Interest 588 435 283 130 (23) (176) (328) (481) PBT 1,409 1,409 1,409 1,409 1,682 1,682 1,682 1,682 Tax 282 282 282 282 555 555 555 555 PAT 1,127 1,127 1,127 1,127 1,127 1,127 1,127 1,127 RoE on approved equity (%) 22 22 22 22 22 22 22 22

Source: Company, Edelweiss research 31Operating cash flow 3,000 2,825 2,669 2,514 1,426 1,258 1,102 947

Hydro power: KarchamWangtoo

• The 1,000MW Karcham Wangtoo hydro electric plant located at Himachal Pradesh is expected to generate INR36bn over FY13‐15E

• Commissioned in FY12, this project has a assured return of 14% at a plant availability of 85%, with i i 0 65% f l fi d h f h il bili hi h h iincentives at 0.65% of annual fixed charge for each percentage availability higher than normative capacity

• Past record of plant availability and secondary energy generation present upsides to our cash flow estimatesestimates

Assumptions and operational detailsKarcham Wangtoo FY13E FY14E FY15E FY16E FY17E FY18E FY19E FY20EPlant Capacity (MW) 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 Design Energy (MU)‐ 90% dependable year 4,261 4,261 4,261 4,261 4,261 4,261 4,261 4,261 D i E (MU) 50% d d bl 4 596 4 596 4 596 4 596 4 596 4 596 4 596 4 596Design Energy (MU)‐ 50% dependable year 4,596 4,596 4,596 4,596 4,596 4,596 4,596 4,596 Primary saleable energy capacity (MU) 3,750 3,750 3,750 3,750 3,750 3,750 3,750 3,750 Approved capex 69,000 69,000 69,000 69,000 69,000 69,000 69,000 69,000 Approved equity 20,100 20,100 20,100 20,100 20,100 20,100 20,100 20,100 Plant availabil ity (%) 99 99 99 99 99 99 99 99 Generation 4 596 4 429 4 429 4 429 4 429 4 429 4 429 4 429Generation 4,596 4,429 4,429 4,429 4,429 4,429 4,429 4,429 Net saleable energy 4,044 3,897 3,897 3,897 3,897 3,897 3,897 3,897 Revenues 16,814 16,219 16,002 15,788 15,577 15,369 15,165 14,963 EBITDA 15,738 15,099 14,838 14,577 14,318 14,060 13,803 13,547 Depreciation 2,128 2,128 2,128 2,128 2,128 2,128 2,128 2,128 EBIT 13,610 12,971 12,710 12,449 12,190 11,932 11,675 11,419 Interest 6,721 6,304 5,919 5,534 5,150 4,766 4,382 3,999 PBT 6,889 6,668 6,791 6,915 7,040 7,166 7,292 7,420 Tax 1,378 1,334 1,358 1,383 1,408 1,433 1,458 1,484 PAT 5,511 5,334 5,433 5,532 5,632 5,732 5,834 5,936 RoE on approved equity (%) 27 27 27 28 28 29 29 30

Source: Company, Edelweiss research 32Operating cash flow 8,645 14,193 13,641 13,354 13,068 12,783 12,499 12,215

Thermal power: Key projects and their status

• 3,700 MW thermal power projects to be commissioned between FY13 and FY16

• Cumulative estimated capex of INR253bn against INR91bn spent till FY12

• Operational cash flow of INR26bn between FY13E and FY15E

• Operational cash flow of INR114bn

Project Size (MW) Fuel supply Capex (INR bn)

Capex completed (FY12)

Funding Cost (INR mn per MW) Expcted COD

Bina I 500 FSA executed for unit I 32.4 27.0 30:70 64.8 Operational

Nigrie 1,320 Pithead located captive coal block –JV between JAL and MPSPMC

81.0 37.8 30:70 Edel estimate of 65 v/s company guidance of 61.4

April 2014 v/s company guidance of CY 2013

Karchana – I Currently on hold

Bara I 1,980 FSA to be executed 107.8 26.2 25:75 Edel estimate of 68 v/s company guidance of 54.5

April 2015 v/s company guidance of CY 2014


54.5 CY 2014

33

Thermal power: Bina

• 500MW coal‐based thermal power plant located at Madhya Pradesh

• Unit 1 of the project commissioned in Q2FY13; unit 2 expected in Q3FY13

• 30% of the electricity generated will be sold on merchant basisy g

• Project expected to generate INR11bn over FY13‐15E

Assumptions and operational detailsBina FY12 FY13E FY14E FY15E FY16E FY17E FY18E FY19E FY20EPlant capacity (MW) ‐ 500 500 500 500 500 500 500 500 % of year when operational ‐ 50 100 100 100 100 100 100 100 PLF (%) ‐ 70 88 88 88 88 88 88 88 Auxiliary consumption (%) ‐ 7 7 7 7 7 7 7 7 Gross Generation (mn KwH) ‐ 1,533 3,854 3,854 3,865 3,854 3,854 3,854 3,865 Net Generation (mn KwH) 1 426 3 585 3 585 3 594 3 585 3 585 3 585 3 594Net Generation (mn KwH) ‐ 1,426 3,585 3,585 3,594 3,585 3,585 3,585 3,594 Calorific value of coal 3,500 3,500 3,500 3,500 3,500 3,500 3,500 3,500 3,500 Plant heat rate 2,400 2,400 2,400 2,400 2,400 2,400 2,400 2,400 2,400 Coal required (Mn Tons) ‐ 1 3 3 3 3 3 3 3 Coal cost per ton 1,350 1,418 1,488 1,563 1,641 1,723 1,809 1,900 1,995

Total Revenues ‐ 3 227 10 152 10 170 10 448 10 444 10 470 10 752 10 811Total Revenues 3,227 10,152 10,170 10,448 10,444 10,470 10,752 10,811 Total opex ‐ 2,347 4,934 5,180 5,452 5,711 5,997 6,297 6,627 EBITDA ‐ 880 5,218 4,990 4,996 4,733 4,473 4,455 4,184 Depreciation ‐ 855 1,711 1,711 1,711 1,711 1,711 1,711 1,711 EBIT ‐ 24 3,508 3,279 3,285 3,022 2,762 2,744 2,473 Interest ‐ 1,184 2,269 2,059 1,853 1,642 1,430 1,224 1,011


PBT ‐ (1,159) 1,238 1,220 1,432 1,380 1,332 1,520 1,462 Tax ‐ (232) 248 244 286 276 266 304 292 Profit After Tax ‐ (927) 991 976 1,146 1,104 1,066 1,216 1,169 Cash flow from operations ‐ 1,048 4,758 4,803 4,730 4,519 4,271 4,176 3,962

34

Thermal power: Nigrie

• 1,320MW coal‐based thermal power plant located at Madhya Pradesh

• Project expected to be commissioned in FY15

• 50% of the electricity generated will be sold on merchant basis

• Project expected to generate INR15bn over FY13‐15, all of it in FY15

• Cash generation in the project FY16 onwards will be ~INR20bn annually

Assumptions and operational detailsNigrie FY12 FY13E FY14E FY15E FY16E FY17E FY18E FY19E FY20EPlant capacity (MW) ‐ 1,320 1,320 1,320 1,320 1,320 1,320 1,320 1,320

% of year when operational ‐ ‐ 25 100 100 100 100 100 100 PLF (%) ‐ ‐ ‐ 70 88 88 88 88 88 Auxiliary consumption (%) ‐ 6 6 6 6 6 6 6 6 Gross Generation (mn KwH) ‐ ‐ ‐ 8,094 10,203 10,176 10,176 10,176 10,203 Net Generation (mn KwH) ‐ ‐ ‐ 7,609 9,591 9,565 9,565 9,565 9,591 Calorific value of coal 4,500 4,500 4,500 4,500 4,500 4,500 4,500 4,500 4,500 Plant heat rate 2,200 2,200 2,200 2,200 2,200 2,200 2,200 2,200 2,200 Coal required (Mn Tons) ‐ ‐ ‐ 4 5 5 5 5 5

lCoal cost per ton 900 945 992 1,042 1,094 1,149 1,206 1,266 1,330 Total Revenues ‐ ‐ ‐ 23,789 30,258 30,458 31,149 31,455 31,853 Total opex ‐ ‐ ‐ 6,665 8,219 8,613 9,044 9,496 9,991 EBITDA ‐ ‐ ‐ 17,124 22,039 21,845 22,105 21,958 21,862 Depreciation ‐ ‐ ‐ 4,530 4,530 4,530 4,530 4,530 4,530 EBIT 12 594 17 509 17 315 17 575 17 428 17 332EBIT ‐ ‐ ‐ 12,594 17,509 17,315 17,575 17,428 17,332 Interest ‐ ‐ 1,944 8,305 7,667 6,774 5,889 4,995 4,100 PBT ‐ ‐ (1,944) 4,288 9,841 10,541 11,686 12,434 13,232 Tax ‐ ‐ (389) 858 1,968 2,108 2,337 2,487 2,646 Profit After Tax ‐ ‐ (1,555) 3,431 7,873 8,433 9,349 9,947 10,586 Cash flow from operations ‐ ‐ 389 15,282 19,908 19,837 19,803 19,578 19,326

Source: Company, Edelweiss research 35

p , , , , , ,

Thermal power: Bara

• 1,980MW coal‐based thermal power plant located at Uttar Pradesh

• Project expected to be commissioned in FY16

• 90% of the electricity generated will be sold on PPA

• Pending capex on the project is estimated at INR109bn

• Cash generation in the project FY16 onwards likely to be ~INR15bn annually

Assumptions and operational detailsBara I FY12 FY13E FY14E FY15E FY16E FY17E FY18E FY19E FY20EPlant capacity (MW) ‐ 1,980 1,980 1,980 1,980 1,980 1,980 1,980 1,980 % of year when operational ‐ ‐ ‐ ‐ 70 100 100 100 100 PLF (%) ‐ ‐ ‐ ‐ 70 88 88 88 88 Auxiliary consumption (%) ‐ 6 6 6 6 6 6 6 6 G G i ( ) 8 22 263 263 263 30Gross Generation (mn KwH) ‐ ‐ ‐ ‐ 8,522 15,263 15,263 15,263 15,305 Net Generation (mn KwH) ‐ ‐ ‐ ‐ 8,011 14,348 14,348 14,348 14,387 Calorific value of coal 3,500 3,500 3,500 3,500 3,500 3,500 3,500 3,500 3,500 Plant heat rate 2,350 2,350 2,350 2,350 2,350 2,350 2,350 2,350 2,350 Coal required (Mn Tons) ‐ ‐ ‐ ‐ 6 10 10 10 10 Coal cost per ton 1 198 1 274 1 354 1 440 1 532 1 629 1 732 1 843 1 960Coal cost per ton 1,198 1,274 1,354 1,440 1,532 1,629 1,732 1,843 1,960 Total Revenues ‐ ‐ ‐ ‐ 20,079 37,425 37,115 38,076 37,890

Total opex ‐ ‐ ‐ ‐ 11,713 20,100 21,331 22,639 24,086 EBITDA ‐ ‐ ‐ ‐ 8,366 17,325 15,784 15,436 13,804 Depreciation ‐ ‐ ‐ ‐ 4,995 7,135 7,135 7,135 7,135 EBIT ‐ ‐ ‐ ‐ 3,371 10,189 8,649 8,301 6,668EBIT 3,371 10,189 8,649 8,301 6,668 Interest ‐ ‐ ‐ ‐ 7,710 10,167 9,184 8,227 7,240 PBT ‐ ‐ ‐ ‐ (4,338) 22 (535) 74 (572) Tax ‐ ‐ ‐ ‐ (868) 4 (107) 15 (114) Profit After Tax ‐ ‐ ‐ ‐ (3,471) 18 (428) 60 (458) Cash flow from operations ‐ ‐ ‐ ‐ 8,150 16,590 16,177 15,509 14,225 Source: Company, Edelweiss research

36

Real Estate

• Largest land bank in NCR amongst all real estate players – bulk of it in Jaypee Infratech

• Established brand and credentials—sold 68 msf, more than any other in the country, and collected INR78 bn over past 3 years

• 632msf of developable area still in inventory between JPIN and JPSI; Balance land parcels along the high‐growth corridor of the newly commenced Yamuna Expressway and largely part of the JaypeeSports City

Company/ Location Cumulative area Cumulative sales Cumulative Average sold (msf) value (INR mn) collections realisations

JAL G t N id 5 72 28 790 20 830 5 036

Location wise performance – JPA (consolidated)

• EBITDA of INR 103 bn over FY13‐15E, Cash generation of INR 67bn over FY13‐15E

JAL – Greater Noida 5.72 28,790 20,830 5,036 JAL ‐ Noida 8.33 48,896 30,519 5,870 Jaypee Infratech 47.10 150,580 86,213 3,197

2.34 7,196 2,966 3,075 0.4msy 6,592 18,582

68 242 054 145 325 3 576

Jaypee Sports Int’l .

Annual sales performance – Jaypee InfratechPeriod No. of units sold Area sold (msf) Average rate (INR/sf) Sales value Advances receivedFY2009 700 1 3,328 3,162 630 FY2010 13,205 20 2,540 51,705 16,699

68 242,054 145,325 3,576

Source: Company

, , , ,FY2011 7,906 12 3,308 40,953 31,455 FY2012 5,100 11 4,162 45,450 29,378 Q1FY13 967 3 3,724 9,310 8,050

27,878 47 3,197 150,580 86,212

Source: Company

37

Land parcels of JPA’s real estate division

Company/ Location Total Developable Area (msf)

JAL – Greater Noida 8 JAL Noida 24JAL ‐ Noida 24 Jaypee Infratech 530 Jaypee Sports Int’l . 133 Total 696

38Source: Company

Real estate: JPIN

• Vast development potential of 530msf over 5 land parcels along the Yamuna Expressway

• Robust sales of 9.55 msf at an average rate of INR4,141 in FY12

• Expected sales of INR133bn (33 msf) at an average rate of INR4,000 over FY13‐15E

• Commencement of Yamuna Expressway expected to enhance connectivity and increase economic activity in the surrounding area

JPIN Real estate performanceJaypee Infratech FY12 FY13E FY14E FY15E

Area soldNoida 8.47 8.83 7.01 5.60 Greater Noida 1.08 1.75 2.60 3.07 Agra ‐ 0.75 1.45 2.15

9.55 11.33 11.06 10.82 A R tAverage RateNoida 4,350 4,568 4,796 5,036 Greater Noida 2,500 2,625 2,756 2,894 Agra ‐ 2,205 2,315 2,431

4,141 4,111 3,991 3,910 Cash InflowsCash Inflows

Noida 28,364 39,052 45,729 43,977 Greater Noida 909 2,674 5,520 7,856 Agra ‐ 514 1,712 3,567

29,273 42,240 52,961 55,401 Cash OutflowsNoida 16,551 21,926 24,260 20,817 Greater Noida 1,521 2,230 3,498 5,555 Agra ‐ 708 1,656 2,751

18,071 24,864 29,415 29,124 Taxes paid 2,918 3,904 4,896 4,645

Source: Company, Edelweiss research 39Operating cash flow 8,283 13,472 18,650 21,631

Yamuna Expressway: JPIN

• The 6‐lane access controlled expressway has commenced operations from August 9, 2012

• With a traffic potential of 45,000 PCUs per day, we expect traffic to ramp up steadily over 5‐7 years

• Currently, the road is generating daily toll collection of INR2.5mn per dayy, g g y p y

Yamuna Expressway performance metricsYE‐ Greater‐Noida Agra FY13E FY14E FY15E FY16E FY17E FY18E FY19E FY20E

Traffic Volume ('000 PCUs) 821 3,548 4,790 9,311 13,408 19,307 22,927 22,927 Toll Rate (INR/km) 1.9 2.0 2.1 2.3 2.4 2.6 2.7 2.9 Toll Revenue (INR mn) 207 947 1,355 2,793 4,263 6,507 8,191 8,682 Operating Expenditure 896 950 1,007 1,068 1,132 1,200 1,272 1,348 EBITDA (690) (3) 348 1,725 3,131 5,308 6,919 7,335 Less:Interest 6,384 6,766 6,616 5,983 5,303 4,863 4,424 3,984 Tax Payable/ (Shield) (2,495) (3,406) (3,100) (2,514) (1,930) (1,257) (713) 118 FCFF (4,579) (3,363) (3,167) (1,744) (241) 1,702 3,208 3,232 Less: Debt Repayment 4,507 4,507 4,507 4,507 4,507 4,507 4,507 4,507 FCFE (9 086) (7 870) (7 674) (6 252) (4 749) (2 806) (1 299) (1 275)


FCFE (9,086) (7,870) (7,674) (6,252) (4,749) (2,806) (1,299) (1,275)

40

Financial Summary

Particulars FY10 FY11 FY12 FY13E FY14E FY15EIncome StatementRevenues 65,256 112,593 147,732 205,984 245,027 285,427 EBIDTA 21,917 47,397 53,645 77,532 91,087 106,927 Interest 12,864 18,747 31,341 56,332 53,644 47,237 P fit b f t 20 127 25 891 16 260 8 704 21 799 38 956Profit before tax 20,127 25,891 16,260 8,704 21,799 38,956 Core net profit 11,192 13,823 6,329 558 9,707 19,433 EPS (INR) 5.27 6.50 2.98 0.26 4.56 9.14 Balance sheetShareholders funds 85,403 107,791 114,780 111,757 116,530 127,187 Borrowings 352 711 444 450 531 742 592 658 585 681 569 455Borrowings 352,711 444,450 531,742 592,658 585,681 569,455 Minority Interest & others 21,635 44,356 47,490 49,691 52,033 54,530 Sources of funds 459,748 596,598 694,013 754,106 754,244 751,172 Total fixed assets 304,050 420,980 532,539 618,408 644,937 666,658 Investments 10,586 31,111 32,312 32,312 32,312 32,312 Total current assets 205,515 228,080 227,912 214,411 192,565 173,314 Total current l iabil ities & provisions 60,403 83,573 98,750 111,025 115,570 121,112 Net Current Assets 145,112 144,507 129,163 103,387 76,995 52,202 Uses of funds 459,748 596,598 694,013 754,106 754,244 751,172 Cash Flow Metrics (0) (0) 0 Operating cash flow (10,151) 17,517 41,308 99,381 94,168 97,402 Financing cash flow 148,005 90,640 60,257 3,117 (62,087) (64,928) Investing cash flow (92,216) (124,821) (141,145) (96,311) (39,843) (39,837) Net cash flow 45,638 (16,664) (39,580) 6,187 (7,762) (7,362) Capex (105,082) (129,092) (142,889) (99,619) (42,990) (42,880) RatiosROE (%) 15 79 17 25 8 52 2 11 11 54 21 95ROE (%) 15.79 17.25 8.52 2.11 11.54 21.95 NP Margin (%) 18.20 14.77 6.42 1.16 5.38 9.37 P/E (x) 13.97 9.99 17.52 69.53 12.61 6.21 Price/BV(x) 1.95 1.54 1.45 1.49 1.43 1.31 EV/EBITDA (x) 19.79 11.44 12.47 9.34 7.96 6.69

41

Company Structure

JPA

Real estateCement Power

Standalone(26 mt)

JCCL ‐ 100% subsidiary(10 mt)

JPVL 67.9%Subsidiary Standalone

Jaypee Infratech (83.1%subsidiary)

JPSI (90.5% subsidiary(133msf)

Thermal Power500 MW Bina

Hydro Power300 MW Baspa

400 MW Vishnuprayag74% subsidiary214 kms PGCIL

Noida (24.3msf)G t N id (8 f)

Land parcels at Noida,Jaganpur, Mirzzapur,T l d A f1320 MW Nigrie

1980 MW Bara

p y g1000 MW Karcham

Wangtoo

214 kms PGCILtransmission line

Greater Noida (8 msf) Tappal and Agra of1,235 acres each

Source: Company

42

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