investment opportunity in palm plantations for biodiesel in madagascar 1 promoted by environvest

Investment Opportunity in Palm Plantations for biodiesel in Madagascar

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Promoted by Environvest

Sustainable Solutions for the Environment

Biofuels

What are biofuels: Biofuels are a type of renewable fuel produced from grains, vegetable oils and

animal fats. The 2 best known biofuels are bioethanol and biodiesel.

Why Biofuels: Biofuels can help diversify the fuel supply for transport, and thus decrease the

transport sector’s dependence on oil. Biofuels offer the potential to deliver lower overall greenhouse gas (GHG)

emissions compared with conventional fuels (gasoline and diesel or LPG and CNG).

Biofuels reduce GHG emissions entering the atmosphere on a total well-to-wheels or crop-to-car basis. That is, the carbon dioxide (CO2) emitted when the biofuel is burnt in the vehicle is offset by the CO2 absorbed during the growth of the crop.

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Global Biofuel DemandStrong growth in biofuel consumption

WORLD AND REGIONAL BIOFUEL PRODUCTION

WORLD BIOFUEL CONSUMPTION

Source: IEA World Energy O

utlook, 2006Source: IEA W

orld Energy Outlook, 2006

WORLD BIODIESEL PRODUCTION SHARE IN 2006

Source: IEA World Energy O

utlook, 2006

WORLD BIODIESEL CAPACITY VS PRODUCTION (MILLION MT/YR)

Source: Biodiesel 2020


Brent Crude Oil Price Movement Higher oil prices will provide additional support for development of clean energy technologies like biofuel

BRENT CRUDE OIL PRICE MOVEMENTS (US$/BBL)

Source: EIA July 2009, Weekly All Countries Spot Price FOB Weighted by Estimated Export Volume In 2008 Oil prices had

crossed the US$ 100/bbl mark. Medium term

view is above US$ 65/bbl


Biofuel Market SizeNascent industry poised for fast growth

WORLD BIOFUEL MARKET SIZE IN US$ BILLION

Source: Biofuels for transportation, New energy management report 2006

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KEY GROWTH POTENTIAL AND CHALLENGES

POTENTIAL BENEFITS Reductions in oil

imports and improved energy security

Lower GHG Emissions Reduced Air Pollution Improved Vehicle

Performance Agricultural /rural jobs,

income Reduction in solid

wastes (biomass, grease etc.)

POTENTIAL CHALLENGES Higher Fuel Production

Costs Arable Land and Labour

Availability Higher Food Prices:

Fuel Vs. Food debate

Apart from energy security and green house reduction the development of biofuel as a source of energy when grown on a large scale, could represent a paradigm shift in agricultural development. If mechanisms are introduced to ensure that much of the increase in food prices accrues to the farmers, both biofuel and increased food prices can stimulate rural economic growth through additional capital inflows, create demand for goods and services that provide employment, reduce rural-urban migration, and create linkages and multipliers


Global Biofuel ScenarioBiofuel initiatives launched with many countries recently announcing various incentives and targets


Biofuel TradeIncreasing global trade flows , capacity expansion and entry of non-agri players in the market – opportunities unlimited….


Global demand for biofuel crops outpacing supply Arable land availability constraint and slower growth in global feedstock oil production is adding pressures on biodiesel price

WORLD FEEDSTOCK OIL PRODCUTION 2006-08 (MILLION MT)

125

130

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BIODIESEL B-20 HISTORICAL PRICES 2001-08 (US$/GALLON)Source: Oil World Annual Report (1999-2008) & Oil World Weekly (12 Dec, 2008) Source: US Department of Energy 2008, B-20 prices

Biodiesel Feed Stock Options

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Biodiesel Feedstock OptionsWith high productivity and lower production costs, palm is a more suitable for development of biofuels in the region with arable land and labour

FeedstockCost of Production

US$/LTR Yield, LTR/HA/YRGHG EMISSION

REDUCTIONENERGY

INPUT/OUTPUT REMARKS

Rapeseed 0.60-0.82 1000-1200 48-60 9-9.5Better used as food crop due to nutritive value and low oil yield. Oil production cost /ha is high

Soybean 0.50-0.75 400-700 40-65 9-10.5Better used as food crop due to nutritive value and low oil yield. Oil production cost /ha is high

Palm 0.40-0.60 4500-6000 50-55 10-15 High oil yield and low production costs

Sunflower 0.50-0.65 800-1000 40-65 NABetter used as food crop due to nutritive value and low oil yield. Oil production cost /ha is high

Jatropha 0.30-0.50 2000-2500 40-45 5-10Long gestation period and low yield. Good for wastelands with low arable potential

Algae 3.0-4.0 150000-175000 NA NAVery high costs of cultivation and not proven on commercial scale

WORLD FEEDSTOCK OIL USE (MILLION LBS)Source: Oilseeds Workshop, Dec 2008

Source: Fulton et al, Gardner, US DOE, EIA; ICRISAT


Oil Palm as feedstock

Choice of Oil Palm as Feedstock High oil yield: 5-6 t/ha Lower cost of production: 0.4 to 0.6 USD/litre Attractive local market. Large export market for crude palm oil and derivatives. Suitable land and climatic conditions of the region. Approachability of a sea port near the proposed project area. Optional choice for Palm oil to be sold as

Crude Palm oil Refined palm oil Palm oil based Biodiesel

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Oil Palm VarietiesHigh yielding varieties suitable for Africa

TolerabilityPalm types Trunk growth (cm/yr) Leaf length (m) Oil to Bunch (%) Fruit (g) Bunch(kg) Low sunlight Low temp DroughtDeli x Ghana 55-60 8-8.5 28 - 30 9-9.5 >22 High Moderate ModerateDeli x Nigeria 50-55 7.6-8.0 28-30 9-10.5 >22 Moderate Moderate ModerateEvolution 50-55 7.6-8.0 >30 >11 >22 High Moderate ModerateDeli x La Me 50 - 55 7.6-8.0 <26 <9 <18 Moderate Low HighTanzania x Ekona 50 - 55 7.6-8.0 26-28 <9 18-22 Moderate High Mod-HighBamenda x Ekona 45-50 7.6-8.0 28 <9 18-22 Moderate High HighCompacta x Ghana 40-45 6.6-6.9 28-30 9-10.75 18-22 Moderate Moderate Mod-HighCompacta x Nigeria 40-45 6.6-6.9 28-30 9-10.5 18-22 Moderate Moderate Mod-HighDeli x Compacta 40-45 6.6-6.9 28-30 9-10.5 18-22 Moderate Moderate ModerateAmazon 25 7-7.5 21-23 9-10.5 >22 Moderate Low LowBrunca 25 8-8.5 18-20 9-10.5 >22 Moderate Moderate ModerateClone de compactas <40 <6.5 28-32 NA NA NA NA NA

DELI X LA ME (STANDARD VARIETY)

The Deli x LaMe lines were developed in the Ivory Coast by the former IHRO. Some of these lines, including palms derived from L2T, were introduced to Costa Rica in 1980

Tolerant to vascular wilt a prominent disease found in Africa

Grows to 2 meters with a FFB yielding capacity of 5 t/ha increasing to 15 t/ha during later years

Source: www.asd-cr.com, Costs Rica


Palm Oil Producing NationsMalaysia and Indonesia account for 85% of the global palm oil supply, but are constrained on arable land given deforestation concerns

Countries 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Indonesia 6,250 7,050 8,080 9,370 10,600 12,380 14,100 16,050 17,270 19,330

Malaysia 10,554 10,842 11,804 11,909 13,355 13,976 14,962 15,881 15,824 17,734

Thailand 560 525 625 600 690 735 700 860 1,020 1,170

Nigeria 720 740 770 775 785 790 800 815 835 860

Colombia 500 524 548 528 527 632 661 713 732 800

Ecuador 263 218 228 238 262 279 319 352 396 415

Papua New Guinea 264 336 329 316 326 345 310 365 384 400

Cote d'Ivore 264 278 205 265 240 270 320 330 320 330

Honduras 90 101 130 126 158 170 180 195 220 268

Brazil 92 108 110 118 129 142 160 170 190 220

Costa Rica 122 137 150 128 155 180 210 198 200 202

Guatemala 53 65 70 86 85 87 92 125 130 139

Vanezeula 60 70 52 55 41 61 63 65 70 56

Others 833 873 883 895 906 940 969 1,023 1,083 1,194

Total 20,625 21,867 23,984 25,409 28,259 30,987 33,846 37,142 38,674 43,118

Currently Malaysia dedicates 5 million Ha to oil palm plantations, while not more than 6 million can be dedicated to this crop, an increase of 20%, allowing for a only a few years of market growth


Safflower – An Additional source of income for the initial years. Oil crop with a duration of 125-130 days Can be grown throughout the year under favourable climatic conditions. Adaptable to climatic conditions prevailing in the African region. Temperatures

ranging from 25-320 C found to be the most conducive. Seeds have an oil content ranging from 26-30%. Yields as high as 4 tonnes/ha/yr can be realized with 2 crops per year. Dried seeds can be stored for long and hence can be used round the year. Staggered sowing and harvesting will help in longer availability of raw material for

the biodiesel plant. Crop is drought tolerant with lower requirements of nutrients comparatively. The cost of cultivation of 2 crops per hectare per year is $ 416 with a gross income

of $ 684 per ha/yr. Safflower can be source of raw material for the biodiesel plant to be set up in the

2nd year Cultivation of 2000 ha of safflower will ensure a raw material of an average of 8000

t/yr.14

Biofuel Potential in Sub-Saharan Africa

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Biofuel Development Potential in Sub-Saharan AfricaSub-Saharan Africa has plenty of uncultivated irrigated land with no need to deforest. Biodiesel production is estimated to create up to 1.1 million jobs in Sub-Saharan Africa – FAO 2005


LAND USE DATA IN SELECTED COUNTRIES (2006) POPULATION DENSITY DATA IN SELECTED COUNTRIES (2006)

FOREIGN INVESTMENT STOCK IN SELECTED COUNTRIES

Land Usage and Population Density in Sub-Saharan AfricaLand availability with low population density is driving foreign investment in this region

Source: FAO Report “Land Grab or Opportunity” 2008 Source: FAO Report “Land Grab or Opportunity” 2008

Source: UNCTAD 2008


Year Country Investor Type of Crop Area (Ha) Remarks

2005 Madagascar D1 BP Jatropha 17000So far mainly contract farming,

small own plantation established in 2008 (50 Ha)

2008 Madagascar GEM Biofuels PLC Jatropha 452000Planted out 30,000 Ha. Company is

listed on AIM and secured land rights for 50 years on 452000 Ha

2008 Madagascar JatroSolutions GmBH Jatropha 3000 Jatropha Plantation for Biodiesel

2008 Madagascar TOM-Investment-MMF Jatropha 500/100000* NA

2008 Madagascar J+J Group Jatropha 25000* NA

2008 Madagascar NEO-new ecologic oil Jatropha 30000* NA

2008 Madagascar Avana Group Jatropha 10000* NA

2008 Madagascar ERI-eco regional initiatives Jatropha 680 NA

2008 Madagascar Jatrogreen Jatropha 200/3000* NA

2008 Madagascar JSL-GEXSI Jatropha 300/300* NA

Land Under Investor Claim for Biofuel (Approved Projects)Production of liquid biofuels is a key driver of much recent land acquisition

KEY BIOFUEL PROJECTS IN MADAGASCAR

Source: WWF Report, 2008

Environvest: Project Madagascar


Madagascar Country Fact Sheet

GeographyArea 592,000 sq kmCapital AntananarivoClimate Moderate interior tropical coastsPeoplePopulation (2009E) 20.6 millionLiteracy 68.9%

HealthInfant Mortality Rate – 54.2/1000. Life Expectancy 63 years

Work force Agriculture: 80%; Industry : 7%GovernmentType RepublicAdministrative Subdivisions 6 regionsGovernance Index Rank* 25Economy (2008)GDP US$ 9.7 billionAverage Growth Rate NAPer Capita Income US$ 1,000

Economy StructureAgriculture: 26% of GDP; Industry and Manufacturing: 15.9% of GDP

Trade Exports: US$ 989 millionMajor Markets France, China, Iran, Mauritius and Hong KongSource: US Department of State, * - Mo Ibhrahim index


Investment SupportThe Government of Madagascar has has begun to implement a regulatory framework favourable to investment.

Liberalisation of the economy through the privatisation of state-owned companies and of financial transfers by resident and non-resident foreigners and abolition of export taxes.

Regional integration through membership of the Common Market of Eastern and Southern Africa (COMESA), and participation in the Cross Border Initiative (CB), the Indian Ocean Commission and the Indian Ocean Rim Association for Regional Cooperation (IOR-ARC).

Promotion of the Export Processing Zone (EPZ) regime, granting various incentives (including tax) to export-oriented investment.

Madagascar is a member of the Multilateral Investment Guarantee Agency (MIGA) and of the African Trade Insurance Agency (ATI) to cover investors against political risks and to guarantee international financial or trade transactions. The free movement of capital is ensured by the conventions signed with the IMF.

State-owned land can be allocated to foreign companies through a 99-year lease. Moreover, the 99-year real estate lease gives the leaseholder a mortgage right which can be transferred or seized in the prescribed forms for foreclosure. Surveys have been carried out to identify state-owned land that can be reserved for industrial development or tourism.

A Companies Information Office (BIPE) has been established to assist private companies in the registration and search for market information. A 'one-stop-shop' for private investment (GUIDE) is operational and aims to facilitate and reduce the administrative procedures related to the creation, investment and operation of a company (administrative formalities, tax system, long stay visa, etc).

Madagascar is speeding up its legal reforms, including the business regulatory framework. New corporate laws and collection procedures have been adopted.

Government has adopted steps like; Abolition of VAT collection for exports and EPZ firms, up to the amount of their VAT credit; Abolition of deposit payment and facilitation of income payment; Suppression or suspension of import taxes on goods such as cement, yarns and fabric, iron, steel and other needed for items for construction, agricultural material and equipment.


Trade Agreements for MadagascarAgreements have been put in force to give eligible Sub-Saharan African (SSA) countries and the least development countries (LDCs) quota free/duty free access to United States and EU Markets

Madagascar has significantly liberalized its trade regime in recent years. Its present trade policy framework is essentially based on tariffs. Export restrictions have been eliminated, as have foreign exchange controls. The Government has placed emphasis on export promotion, but limited capacity has constrained any significant export-led growth

Madagascar has increasingly participated in regional trade agreements. Madagascar's main trading partners are the European Union (EBA), the United States (AGOA), and Japan

Madagascar has made considerable efforts to create an environment conducive to private investment, both domestic and foreign. With a few exceptions (including in real estate and areas still under State control), 100% foreign ownership is permitted in most economic activities

Madagascar, has significantly liberalized its trade regime in recent years. Its present trade policy framework is essentially based on tariffs. Customs tariff rates have been organized into four bands ranging from zero to 30%


Project Site Location


Project Site Characteristics

Parameters Details

Location Fort Dauphin (Madagascar)

Area South East coast of Madagascar

Altitude 300-700 m

Temperature Min: 20.6 & Max: 27.3 o C

Population Density 1.32/sq km

Rainfall (total mm/year, pattern) 3250 mm/yr, Intermittent rains throughout the year

Water level High

Distance from Port 50 km from Taolanaro Port

Land Cover Grass lands

Available Land for Palm Plantation 157,600 ha

Land Allocated (MOU) 125,000 ha

Project Land Area 10000 ha

Soils and Topography Alluvial soil, (mixture of Plateau and slopes)

Length of Growing Period and Soil Moisture Properties

25 years, Well drained with adequate residual moisture


Project plan

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Land acquisition

Crude Palm Oil

Biodiesel Unit

BiodieselRefined Oil

Refining Unit

MarketLand DevelopmentSeeds

purchase

Nursery Development

Plantation

Harvesting

FFB Crushing Unit

Palm kernel crushing unit

FFB’s


Brief overview of the project

The project aims at development of palm plantations on 10,000 ha of land on the eastern coast of Madagascar.

The project involves the following: Land development:

Felling, Land clearing, Leveling, preparation of irrigation & Drainage channels. Roads, Lining and Layout. Installation of Boreholes and irrigation systems.

Seed procurement: Import of high quality seeds/ sprouted seeds from PalmElit SAS - France

Nursery Development: (14 Months) Development of 106 ha of land for Nursery. The seeds/sprouted seeds would be grown pre-nursery for 3-4 months and

then planted into bigger pots/polybags for 8-10 months for complete maturity to transplant.

Polybags/pots are arranged at 70 x 60 cm spacing, in an equilateral triangle arrangement.

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Brief overview of the project (Contd..)

Plantation Development: ( 4 Months) Pit digging, Manure and Fertiliser application Transplanting from the nursery at a spacing of 9 x 8 m: 138 Plants per hectare 114 ha plantation per day with 3 labours/ha/day.

Harvesting : (4 Months/year) Maturity for 1st Harvest after 4 years of plantation development. Yield of FFB(Fresh fruit bunches) vary from 5t/ha in the 4th Year to 15-18t/ha

in the 10th year Harvesting done by labours manually with the help of Chisel/Harvesting Knife. 114 ha harvested daily with an average yield of 5-6t/ha.

Transportation: The harvested FFB’s are collected and transported to the crushing unit with

the help of tipper trucks.

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FFB Crushing Unit: ( Capacity 40t/hr) Sterilization of FFB’s, Threshing of FFB’s for fruit separation, Digestion of the

fruits in a Digester, Pulp Pressing and Oil Extraction Oil Clarification, Oil filtering, Oil Drying to reduce moisture. Crude Storage Running 90 days.

Palm Kernel Crushing Unit: ( Capacity 1t/hr) Nut recovery, Pericarping, Nut cracking, Kernel separation and drying Kernel oil extraction Running 180 days

Refining Unit ( Capacity 175 KLPD) Crude Palm oil to Refined to a higher grade. Storage for longer use Running 180 days.

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Transesterification Unit/ Biodiesel Unit: ( Capacity 100 KLPD) Semi-continuous Batch Process BD unit ( Eastern Biodiesel technologies,

India) Both Crude and Refined palm oil can be used for producing biodiesel. BD plant running for 300 days.

Products for Offtake: Crude Palm Oil Refined Palm oil and derivatives Biodiesel Glycerine Other activities related to the project: Community development activity like Drinking water wells for the local

community, Job opportunities in the project, help in construction of houses, and other related activities.

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Project details (Tabulated)

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DescriptionPlantation area 10000 ha

Duration for Nursery and area 14 months / 106 haDuration for Plantation on 10000 ha 4 monthsPalm plantation returns 4th Year onwardsFFB yield/ha/year 5 t initially to 15 t at full maturityCrude palm oil Yield/ha/year 3 to 5 t Biodiesel conversion rate from CPO 78%Biodiesel conversion rate from RPO 95%POME & other by-products 70%Biomass yields/ha/yr 2-3 tFFB Crushing unit capacity 40 t/hrPalm kernel crushing unit 5t/hrRefining unit capacity 175 KLPDTransesterification unit capacity 100 KLPDPlant operation days 300Safflower cultivation as additional income source 2000 ha


Details of expenses

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Details Cost(million $)Land acquisition & development costs 0.20Nursery Material costs(Seeds , fertilisers) 2.39Plantation costs 0.20Irrigation and water costs 0.11Total Labour + staff costs 1.29Equipment and machinery costs 3.83Overhead costs 1.46Pre-operative expenses 0.47Maintenance material costs 0.57FFB Crushing unit costs 0.5Palm kernel crushing unit 0.2Refining unit cost 2.5Transesterification costs 3.5Costs of Chemicals 0.3Cost of safflower cultivation (2000 ha/yr) 0.83

Miscellaneous costs 0.2Total 18.50

Sustainable Solutions for the Environment 32

Yield

Fruit Vs Palm Oil Yield per Ha

Crude, Refined and Biodiesel Yield per Ha


Financials – Profit and Loss Accounttill

Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Mar-25 Mar-30 Mar-35Revenues- Crude Sa le 828,000 1,380,000 2,208,000 2,760,000 3,312,000 4,140,000 4,140,000 4,140,000 - Refi ned Sa le 1,656,000 2,760,000 4,416,000 5,520,000 6,624,000 8,280,000 8,280,000 8,280,000 - Biodiesel Sa le 2,415,000 4,025,000 6,440,000 8,050,000 9,660,000 12,075,000 12,075,000 12,075,000 Biomass 436,770 727,950 1,164,720 1,455,900 1,747,080 2,183,850 2,183,850 2,183,850 Tree trunk - - - - - - - - Saffl ower 1,368,000 1,395,360 1,423,267 1,451,733 1,480,767 1,510,383 1,540,590 1,571,402 1,602,830 1,769,654 1,953,841 2,157,198 Tota l Revenue 1,368,000 1,395,360 1,423,267 1,451,733 6,816,537 10,403,333 15,769,310 19,357,302 22,945,910 28,448,504 28,632,691 28,836,048

Operating expensesLand Lease - 10,000 10,000 10,000 10,000 10,000 10,000 10,000 Plantation Maintenance 118,309 365,354 379,094 393,430 408,390 493,638 599,568 731,594 Permanent Staff 45,946 82,703 86,838 91,180 95,739 122,190 155,949 199,035 Overheads 191,316 364,670 371,561 378,648 385,938 425,631 471,336 523,977 Harvesting Costs (Per Year) 98,057 137,056 143,685 150,645 157,953 200,355 254,471 323,539 Chemica l costs 300,000 306,000 312,120 318,362 324,730 358,528 395,844 437,043 Saffl ower Costs 832,000 848,640 865,613 882,925 900,584 918,595 936,967 955,706 974,821 1,076,281 1,188,301 1,311,980 Total Operating expenses 832,000 848,640 865,613 882,925 1,654,212 2,184,378 2,240,265 2,297,972 2,357,571 2,686,623 3,075,469 3,537,168

- - - - - - - - EBITDA - - 536,000 546,720 557,654 568,807 5,162,326 8,218,954 13,529,045 17,059,330 20,588,339 25,761,881 25,557,222 25,298,880 EBITDA % 76% 79% 86% 88% 90% 91% 89% 88%Depreciation 883,666 897,666 911,666 939,666 967,666 985,094 985,094 985,094 EBIT - - 536,000 546,720 557,654 568,807 4,278,660 7,321,289 12,617,380 16,119,664 19,620,674 24,776,787 24,572,128 24,313,785 Interest on Working Capita l 132,980 219,280 345,692 430,051 514,417 641,951 643,549 645,447 Interest on Term Loan 1,060,399 1,060,399 1,060,399 1,060,399 1,060,399 1,060,399 1,060,399 1,060,399 1,060,399 1,016,216 927,849 486,016 44,183 - PBT (1,060,399) (1,060,399) (524,399) (513,679) (502,744) (491,591) 3,085,281 6,041,609 11,211,289 14,673,398 18,178,408 23,648,819 23,884,395 23,668,339 Tax - - - - - - 617,056 1,208,322 2,242,258 2,934,680 3,635,682 4,729,764 4,776,879 4,733,668 PAT (1,060,399) (1,060,399) (524,399) (513,679) (502,744) (491,591) 2,468,225 4,833,288 8,969,031 11,738,718 14,542,726 18,919,055 19,107,516 18,934,671 PAT% - - (0) (0) (0) (0) 36% 46% 57% 61% 63% 67% 67% 66%


Financials – Balance Sheet

BALANCE SHEETMar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Mar-25 Mar-30 Mar-35

LIABILITIESEquity 8,836,657 8,836,657 8,836,657 8,836,657 8,836,657 8,836,657 8,836,657 8,836,657 8,836,657 8,836,657 8,836,657 8,836,657 8,836,657 Reserves (1,060,399) (2,120,798) (2,645,196) (3,158,875) (3,661,620) (4,153,211) (1,684,986) 3,148,301 12,117,332 23,856,051 38,398,777 129,673,251 224,849,218 319,958,326 Tota l Networth (1,060,399) 6,715,859 6,191,460 5,677,781 5,175,037 4,683,446 7,151,670 11,984,958 20,953,989 32,692,707 47,235,433 138,509,908 233,685,875 328,794,983 Long Term Debt - 8,836,657 8,836,657 8,836,657 8,836,657 8,836,657 8,836,657 8,836,657 8,836,657 8,100,269 7,363,880 3,681,940 - - Working Capi ta l Loan - - - - - - 1,329,802 2,192,804 3,456,922 4,300,507 5,144,170 6,419,514 6,435,494 6,454,468

Total Liabilities (1,060,399) 15,552,516 15,028,117 14,514,438 14,011,694 13,520,102 17,318,129 23,014,418 33,247,567 45,093,483 59,743,484 148,611,362 240,121,369 335,249,451

ASSETSGross Block 17,673,313 17,673,313 17,673,313 17,673,313 17,673,313 17,673,313 17,743,313 17,813,313 17,953,313 18,093,313 19,513,313 19,513,313 19,513,313 Less Cumulative Depreciation - - - - - - 883,666 1,781,331 2,692,997 3,632,663 4,600,328 9,662,371 14,587,842 19,513,313 Net Block - 17,673,313 17,673,313 17,673,313 17,673,313 17,673,313 16,789,647 15,961,982 15,120,316 14,320,650 13,492,985 9,850,942 4,925,471 - Current AssetsSundry Debtors - - - - - - 1,682,428 2,804,047 4,486,475 5,608,093 6,729,712 8,412,140 8,412,140 8,412,140 Advance to suppl iers - - - - - - 271,925 359,076 368,263 377,749 387,546 441,637 505,556 581,452 Net Current Assets - - - - - - 1,954,353 3,163,122 4,854,737 5,985,842 7,117,258 8,853,776 8,917,696 8,993,592 Cash & Cash Equiva lents (1,060,399) (2,120,798) (2,645,196) (3,158,875) (3,661,620) (4,153,211) (1,425,871) 3,889,314 13,272,514 24,786,991 39,133,242 129,906,643 226,278,201 326,255,859

Total Assets (1,060,399) 15,552,516 15,028,117 14,514,438 14,011,694 13,520,102 17,318,129 23,014,418 33,247,567 45,093,483 59,743,484 148,611,362 240,121,369 335,249,451


Financials – Cash Flow

CASH FLOW STATEMENTMar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Mar-25 Mar-30 Mar-35

PAT (1,060,399) (1,060,399) (524,399) (513,679) (502,744) (491,591) 2,468,225 4,833,288 8,969,031 11,738,718 14,542,726 18,919,055 19,107,516 18,934,671 Add Depreciation - - - - - - 883,666 897,666 911,666 939,666 967,666 985,094 985,094 985,094 Add Interest Expense 1,060,399 1,060,399 1,060,399 1,060,399 1,060,399 1,060,399 1,193,379 1,279,679 1,406,091 1,446,266 1,442,266 1,127,968 687,733 645,447 Operating Cash Flow before WC - - 536,000 546,720 557,654 568,807 4,545,269 7,010,632 11,286,788 14,124,650 16,952,658 21,032,117 20,780,343 20,565,212 Investment in Working Capita lIncrease/Decrease in Sundry Debtors - - - - - - 1,682,428 1,121,619 1,682,428 1,121,619 1,121,619 - - - Increase/Decrease in Loans & Advances - - - - - - 271,925 87,151 9,187 9,486 9,797 11,544 13,667 16,257 Net Cash after Working Capital - - 536,000 546,720 557,654 568,807 2,590,916 5,801,863 9,595,173 12,993,546 15,821,242 21,020,573 20,766,677 20,548,955 Increase/Decrease in Capex - 17,673,313 - - - - - 70,000 70,000 140,000 140,000 - - - Net Cash for Investing Activities - (17,673,313) - - - - - (70,000) (70,000) (140,000) (140,000) - - - increase/Decrease in Equity - 8,836,657 - - - - - - - - - - - - Increase/Decrease in WC Loan - - - - - - 1,329,802 863,002 1,264,118 843,586 843,663 2,886 3,417 4,064 Less Interest pa id on WC Loans - - - - - - (132,980) (219,280) (345,692) (430,051) (514,417) (641,951) (643,549) (645,447) Increase/Decrease in Long Term Loans - 8,836,657 - - - - - - - (736,388) (736,388) (736,388) (736,388) - Less Interest pa id on Long Term Loans(1,060,399) (1,060,399) (1,060,399) (1,060,399) (1,060,399) (1,060,399) (1,060,399) (1,060,399) (1,060,399) (1,016,216) (927,849) (486,016) (44,183) - Net Cash used in Financing Activities (1,060,399) 16,612,914 (1,060,399) (1,060,399) (1,060,399) (1,060,399) 136,423 (416,678) (141,973) (1,339,069) (1,334,991) (1,861,470) (1,420,704) (641,383) Net Increase/Decrease in Cash (1,060,399) (1,060,399) (524,399) (513,679) (502,744) (491,591) 2,727,339 5,315,185 9,383,200 11,514,477 14,346,251 19,159,104 19,345,973 19,907,572 Cash and Cash Equiva lents (1,060,399) (2,120,798) (2,645,196) (3,158,875) (3,661,620) (4,153,211) (1,425,871) 3,889,314 13,272,514 24,786,991 39,133,242 129,906,643 226,278,201 326,255,859


Financials – Cash Flow Analysis

DISCOUNTED FREE CASH FLOW ANALYSIS Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Mar-25 Mar-30 Mar-35

PAT (1,060,399) (1,060,399) (524,399) (513,679) (502,744) (491,591) 2,468,225 4,833,288 8,969,031 11,738,718 14,542,726 18,919,055 19,107,516 18,934,671 Add Depreciation - - - - - - 883,666 897,666 911,666 939,666 967,666 985,094 985,094 985,094 Add Interest Expense 1,060,399 1,060,399 1,060,399 1,060,399 1,060,399 1,060,399 1,193,379 1,279,679 1,406,091 1,446,266 1,442,266 1,127,968 687,733 645,447 Change in WC - - - - - - (1,954,353) (1,208,769) (1,691,615) (1,131,105) (1,131,416) (11,544) (13,667) (16,257) Less CAPEX (17,673,313) - - - - - (70,000) (70,000) (140,000) (140,000) - - - - FCFF (17,673,313) - 536,000 546,720 557,654 568,807 2,520,916 5,731,863 9,455,173 12,853,546 15,821,242 21,020,573 20,766,677 20,548,955

Project NPV 19,627,757 USDProject IRR 24.08% terminal growth not assumed

DISCOUNTED FREE CASH FLOW ANALYSIS EQUITYMar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Mar-25 Mar-30 Mar-35

FCFF (17,673,313) - 536,000 546,720 557,654 568,807 2,520,916 5,731,863 9,455,173 12,853,546 15,821,242 21,020,573 20,766,677 20,548,955 Less Interest Expense (1,060,399) (1,060,399) (1,060,399) (1,060,399) (1,060,399) (1,060,399) (1,193,379) (1,279,679) (1,406,091) (1,446,266) (1,442,266) (1,127,968) (687,733) (645,447) Add Debt 8,836,657 - - - - - 1,329,802 863,002 2,593,920 1,706,587 3,437,583 2,135,311 4,293,795 2,153,089 Debt Repayments - - - - - - - - - 736,388 736,388 736,388 736,388 - FCFE (9,897,055) (1,060,399) (524,399) (513,679) (502,744) (491,591) 2,657,339 5,315,185 10,643,002 13,850,255 18,552,947 22,764,305 25,109,127 22,056,597

IRR- equity 29.07%


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