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TABLE OF CONTENTS

NOTICE TO INVESTORS ..................................................................................................................................... 1 

REPRESENTATIONS BY INVESTORS ............................................................................................................. 3 

DISCLAIMER CLAUSE OF THE STOCK EXCHANGES .............................................................................. 8 

PRESENTATION OF FINANCIAL AND OTHER INFORMATION ............................................................. 9 

INDUSTRY AND MARKET DATA ................................................................................................................... 10 

FORWARD-LOOKING STATEMENTS ........................................................................................................... 11 

ENFORCEMENT OF CIVIL LIABILITIES ..................................................................................................... 12 

EXCHANGE RATES ............................................................................................................................................ 13 

DEFINITIONS AND ABBREVIATIONS .......................................................................................................... 14 

DISCLOSURE REQUIREMENTS UNDER FORM PAS-4 PRESCRIBED UNDER THE COMPANIES ACT, 2013 AND THE RULES MADE THEREUNDER .................................................................................. 25 

SUMMARY OF BUSINESS ................................................................................................................................. 28 

SUMMARY OF THE ISSUE ................................................................................................................................ 36 

SELECTED FINANCIAL INFORMATION ..................................................................................................... 38 

RISK FACTORS .................................................................................................................................................... 49 

MARKET PRICE INFORMATION ................................................................................................................... 83 

USE OF PROCEEDS............................................................................................................................................. 86 

CAPITALISATION STATEMENT .................................................................................................................... 87 

CAPITAL STRUCTURE ...................................................................................................................................... 88 

DIVIDENDS ........................................................................................................................................................... 90 

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS ....................................................................................................................................................... 91 

INDUSTRY OVERVIEW ................................................................................................................................... 117 

BUSINESS ............................................................................................................................................................. 127 

BOARD OF DIRECTORS AND SENIOR MANAGEMENT ........................................................................ 159 

PRINCIPAL SHAREHOLDERS ....................................................................................................................... 169 

ISSUE PROCEDURE .......................................................................................................................................... 174 

PLACEMENT ...................................................................................................................................................... 184 

SELLING RESTRICTIONS .............................................................................................................................. 186 

TRANSFER RESTRICTIONS ........................................................................................................................... 191 

THE SECURITIES MARKET OF INDIA ....................................................................................................... 192 

DESCRIPTION OF EQUITY SHARES ........................................................................................................... 195 

STATEMENT OF TAX BENEFITS ................................................................................................................. 198 

LEGAL PROCEEDINGS ................................................................................................................................... 211 

STATUTORY AUDITORS ................................................................................................................................ 232 

GENERAL INFORMATION ............................................................................................................................. 233 

FINANCIAL INFORMATION .......................................................................................................................... 234 

DECLARATION .................................................................................................................................................. 235 

 

1

NOTICE TO INVESTORS

Our Company has furnished and accepts full responsibility for all of the information contained in this Placement Document and confirms that to its best knowledge and belief, having made all reasonable enquiries, this Placement Document contains all information with respect to our Company and the Equity Shares that is material in the context of the Issue. The statements contained in this Placement Document relating to our Company and the Equity Shares are, in every material respect, true and accurate and not misleading. The opinions and intentions expressed in this Placement Document with regard to our Company and the Equity Shares are honestly held, have been reached after considering all relevant circumstances, are based on information presently available to our Company and are based on reasonable assumptions. There are no other facts in relation to our Company and the Equity Shares, the omission of which would, in the context of the Issue, make any statement in this Placement Document misleading in any material respect. Further, all reasonable enquiries have been made by our Company to ascertain such facts and to verify the accuracy of all such information and statements. The Book Running Lead Managers have not separately verified all of the information contained in this Placement Document (financial, legal, business or otherwise). Accordingly, neither the Book Running Lead Managers nor any of their respective shareholders, employees, counsel, officers, directors, representatives, agents or affiliates make any express or implied representation, warranty or undertaking, and no responsibility or liability is accepted by any of the Book Running Lead Managers or any of their respective shareholders, employees, counsels, officers, directors, representatives, agents or affiliates in connection with investigation of the accuracy or completeness of the information contained in this Placement Document or any other information supplied in connection with the Equity Shares. Each person receiving this Placement Document acknowledges that such person has not relied on the Book Running Lead Managers or on any of their respective shareholders, employees, counsel, officers, directors, representatives, agents or affiliates in connection with its investigation of the accuracy of such information or its investment decision, and each such person must rely on its own examination of our Company and the merits and risks involved in investing in the Equity Shares. No person is authorised to give any information or to make any representation not contained in this Placement Document and any information or representation not so contained must not be relied upon as having been authorised by or on behalf of the Book Running Lead Managers. The delivery of this Placement Document at any time does not imply that the information contained in it is correct as of any time subsequent to its date. The Equity Shares to be issued pursuant to the Issue have not been approved, disapproved or recommended by the U.S. Securities and Exchange Commission, any other federal or state authorities in the United States or the securities authorities of any non-U.S. jurisdiction or any other U.S. or non-U.S. regulatory authority. No regulatory authority has passed on or endorsed the merits of this Issue or the accuracy or adequacy of this Placement Document. Any representation to the contrary is a criminal offence in the United States and may be a criminal offence in other jurisdictions. The Equity Shares have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), and may not be offered, sold or delivered within the United States, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable U.S. state securities laws. Accordingly, the Equity Shares are being offered and sold only outside the United States in off-shore transactions in reliance on Regulation S under the Securities Act (“Regulation S”). The Equity Shares are transferable only in accordance with the restrictions described in the section “Transfer Restrictions”. Each subscriber of the Equity Shares will be deemed to make the representations set forth in the sections “Representations by Investors” and “Transfer Restrictions”. The distribution of this Placement Document or the disclosure of its contents without the prior consent of our Company to any person, other than QIBs specified by the Book Running Lead Managers or their representatives, and those retained by QIBs to advise them with respect to their purchase of the Equity Shares is unauthorised and prohibited. Each prospective investor, by accepting delivery of this Placement Document, agrees to observe the foregoing restrictions and make no copies of this Placement Document or any documents referred to in this Placement Document. The distribution of this Placement Document and the Issue may be restricted by law in certain countries or jurisdictions. As such, this Placement Document does not constitute, and may not be used for or in connection with, an offer or solicitation by anyone in any jurisdiction in which such offer or solicitation is not authorised, or to any person to whom it is unlawful to make such offer or solicitation. In particular, no action has been taken by our Company and the Book Running Lead Managers which would permit an offering of the Equity Shares or

2

distribution of this Placement Document in any country or jurisdiction, other than India, where action for that purpose is required. Accordingly, the Equity Shares may not be offered or sold, directly or indirectly, and neither this Placement Document nor any offering materials in connection with the Equity Shares may be distributed or published in or from any country or jurisdiction, except under circumstances that will result in compliance with any applicable rules and regulations of any such country or jurisdiction. Any reproduction or distribution of this Placement Document in the United States, in whole or in part, and any disclosure of its contents to any other person is prohibited. In making an investment decision, prospective investors must rely on their own examination of our Company and the terms of the Issue, including the merits and risks involved. Investors should not construe the contents of this Placement Document as legal, tax, accounting or investment advice. Investors should consult their own counsel and advisors as to business, legal, tax, accounting and related matters concerning the Issue. In addition, neither our Company nor the Book Running Lead Managers are making any representation to any offeree or subscriber of the Equity Shares regarding the legality of an investment in the Equity Shares by such offeree or subscriber under applicable legal, investment or similar laws or regulations. Each purchaser of the Equity Shares in the Issue is deemed to have acknowledged, represented and agreed that it is eligible to invest in India and in our Company under Indian law, including Chapter VIII of the SEBI Regulations and Section 42 of the Companies Act, 2013, and that it is not prohibited by SEBI or any other statutory authority from buying, selling or dealing in the securities including the Equity Shares. Each purchaser of the Equity Shares in the Issue also acknowledges that it has been afforded an opportunity to request from our Company and review information relating to our Company and the Equity Shares. This Placement Document contains summaries of certain terms of certain documents, which are qualified in their entirety by the terms and conditions of such documents. The information on our Company’s website, any website directly and indirectly linked to the website of our Company or the websites of the Book Running Lead Managers or their affiliates, does not constitute nor form part of this Placement Document. Prospective investors should not rely on the information contained in, or available through such websites.

NOTICE TO INVESTORS IN CERTAIN JURISDICTIONS

In addition to the above, for information to investors in certain other jurisdictions, see the sections “Selling Restrictions” and “Transfer Restrictions” on pages 186 and 191, respectively for further details.

3

REPRESENTATIONS BY INVESTORS References herein to “you” or “your” are to the prospective investors in the Issue. By Bidding for and/or subscribing to any Equity Shares in the Issue, you are deemed to have represented, warranted, acknowledged and agreed to our Company and the Book Running Lead Managers, as follows: You are a “QIB” as defined in Regulation 2(1)(zd) of the SEBI Regulations and not excluded pursuant

to Regulation 86 of the SEBI Regulations, having a valid and existing registration under applicable laws and regulations of India, and undertake to acquire, hold, manage or dispose of any Equity Shares that are Allocated to you in accordance with Chapter VIII and Schedule XVIII of the SEBI Regulations and undertake to comply with the SEBI Regulations, the Companies Act and all other applicable laws, including any reporting obligations;

If you are not a resident of India, but a QIB, you are an Eligible FPI including an FII (including a sub-account other than a sub-account which is a foreign corporate or a foreign individual) having a valid and existing certificate of registration with or on behalf of SEBI under the applicable laws in India or a multilateral or bilateral development financial institution or an FVCI, and have a valid and existing registration with SEBI under the applicable laws in India and are eligible to invest in India under applicable law, including the FEMA Transfer Regulations, and any notifications, circulars or clarifications issued thereunder, and have not been prohibited by SEBI or any other regulatory authority, from buying, selling or dealing in securities;

You will make all necessary filings with appropriate regulatory authorities, including RBI, as required pursuant to applicable laws;

If you are Allotted Equity Shares, you shall not, for a period of one year from the date of Allotment, sell the Equity Shares so acquired except on the floor of the Stock Exchanges (additional requirements apply if you are in jurisdictions other than India, see section “Transfer Restrictions” on page 191 for further details);

You have made, or been deemed to have made, as applicable, the representations set forth under sections entitled “Selling Restrictions” and “Transfer Restrictions” on pages 186 and 191, respectively for further details;

You are aware that the Equity Shares have not been and will not be registered through a prospectus under the Companies Act, the SEBI Regulations or under any other law in force in India. This Placement Document has not been reviewed or affirmed by the RBI, SEBI, the Stock Exchanges, the RoC or any other regulatory or listing authority and is intended only for use by QIBs;

You are entitled to subscribe for and acquire the Equity Shares under the laws of all relevant jurisdictions that apply to you and that you have fully observed such laws and you have the necessary capacity, have obtained all necessary consents, governmental or otherwise, and authorizations and complied with all necessary formalities, to enable you to commit to participation in the Issue and to perform your obligations in relation thereto (including, without limitation, in the case of any person on whose behalf you are acting, all necessary consents and authorizations to agree to the terms set out or referred to in this Placement Document), and will honour such obligations;

Neither our Company nor any of the Book Running Lead Managers or any of their respective shareholders, directors, officers, employees, counsel, representatives, agents or affiliates are making any recommendations to you or advising you regarding the suitability of any transactions it may enter into in connection with the Issue and your participation in the Issue is on the basis that you are not, and will not, up to the Allotment of the Equity Shares, be a client of any of the Book Running Lead Managers.Neither the Book Running Lead Managers nor any of its respective shareholders, directors, officers, employees, counsel, representatives, agents or affiliates have any duties or responsibilities to you for providing the protection afforded to their clients or customers or for providing advice in relation to the Issue and are not in any way acting in any fiduciary capacity;

You confirm that, either: (i) you have not participated in or attended any investor meetings or presentations by our Company or its agents (the “Company Presentations”) with regard to our

4

Company or the Issue; or (ii) if you have participated in or attended any Company Presentations: (a) you understand and acknowledge that the Book Running Lead Managers may not have knowledge of the statements that our Company or its agents may have made at such Company Presentations and are therefore unable to determine whether the information provided to you at such Company Presentations may have included any material misstatements or omissions, and, accordingly you acknowledge that the Book Running Lead Managers have advised you not to rely in any way on any information that was provided to you at such Company Presentations, and (b) confirm that, to the best of your knowledge, you have not been provided any material information relating to our Company and the Issue that was not publicly available;

All statements other than statements of historical fact included in this Placement Document, including, without limitation, those regarding our Company’s financial position, business strategy, plans and objectives of management for future operations (including development plans and objectives relating to our Company’s business), are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause actual results to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding our Company’s present and future business strategies and environment in which our Company will operate in the future. You should not place undue reliance on forward-looking statements, which speak only as at the date of this Placement Document. Our Company assumes no responsibility to update any of the forward-looking statements contained in this Placement Document;

You are aware and understand that the Equity Shares are being offered only to QIBs and are not being offered to the general public, and the Allotment of the same shall be on a discretionary basis at the discretion of our Company and the Book Running Lead Managers;

You are aware that if you are Allotted more than 5.00% of the Equity Shares in the Issue, our Company shall be required to disclose your name and the number of the Equity Shares Allotted to you to the Stock Exchanges and the Stock Exchanges will make the same available on their websites and you consent to such disclosures;

You have been provided a serially numbered copy of this Placement Document and have read it in its entirety, including in particular, the section “Risk Factors” on page 49;

In making your investment decision, you have (i) relied on your own examination of our Company and the terms of the Issue, including the merits and risks involved, (ii) made your own assessment of our Company, the Equity Shares and the terms of the Issue based solely on the information contained in this Placement Document and no other disclosure or representation by our Company, its Directors, Promoters and affiliates, or any other party, (iii) consulted your own independent counsel and advisors or otherwise have satisfied yourself concerning, without limitation, the effects of local laws, (v) received all information that you believe is necessary or appropriate in order to make an investment decision in respect of our Company and the Equity Shares, and (v) relied upon your own investigation and resources in deciding to invest in the Issue;

Neither the Book Running Lead Managers nor any of their respective shareholders, directors, officers, employees, counsel, representatives, agents or affiliates, have provided you with any tax advice or otherwise made any representations regarding the tax consequences of purchase, ownership and disposal of the Equity Shares (including but not limited to the Issue and the use of proceeds from the Equity Shares). You will obtain your own independent tax advice from a reputable service provider and will not rely on any of the Book Running Lead Managers nor on any of their respective shareholders, directors, officers, employees, counsel, representatives, agents or affiliates when evaluating the tax consequences in relation to the Equity Shares (including but not limited to the Issue and the use of proceeds from the Equity Shares). You waive, and agree not to assert any claim against our Company or any of the Book Running Lead Managers or any of their respective shareholders, directors, officers, employees, counsel, representatives, agents or affiliates with respect to the tax aspects of the Equity Shares or as a result of any tax audits by tax authorities, wherever situated;

You are a sophisticated investor and have such knowledge and experience in financial, business and investment matters as to be capable of evaluating the merits and risks of an investment in the Equity Shares. You are experienced in investing in private placement transactions of securities of companies

5

in a similar nature of business, similar stage of development and in similar jurisdictions. You and any accounts for which you are subscribing to the Equity Shares (i) are each able to bear the economic risk of your investment in the Equity Shares, (ii) will not look to our Company and/or any of the Book Running Lead Managers or any of their respective shareholders, directors, officers, employees, counsel, representatives, agents or affiliates for all or part of any such loss or losses that may be suffered in connection with the Issue, including losses arising out of non-performance by our Company of any of its respective obligations or any breach of any representations and warranties by our Company, whether to you or otherwise, (iii) are able to sustain a complete loss on the investment in the Equity Shares, (iv) have no need for liquidity with respect to the investment in the Equity Shares, and (v) have no reason to anticipate any change in your or their circumstances, financial or otherwise, which may cause or require any sale or distribution by you or them of all or any part of the Equity Shares. You acknowledge that an investment in the Equity Shares involves a high degree of risk and that the Equity Shares are, therefore, a speculative investment. You are seeking to subscribe to the Equity Shares in the Issue for your own investment and not with a view to resell or distribute;

If you are acquiring the Equity Shares to be issued pursuant to the Issue, for one or more managed accounts, you represent and warrant that you are authorised in writing, by each such managed account to acquire such Equity Shares for each managed account and to make (and you hereby make) the representations, warranties, acknowledgements and agreements herein for and on behalf of each such account, reading the reference to ‘you’ to include such accounts;

You are not a “Promoter” (as defined under the SEBI Regulations) of our Company or any of its affiliates and are not a person related to the Promoters, either directly or indirectly, and your Bid does not directly or indirectly represent the “Promoter”, or “Promoter Group”, (as defined under the SEBI Regulations) of our Company or persons relating to the Promoter;

You have no rights under a shareholders’ agreement or voting agreement with the Promoters or persons related to the Promoters, no veto rights or right to appoint any nominee director on the Board of Directors, other than the rights acquired, if any, in the capacity of a lender not holding any Equity Shares, which shall not be deemed to be a person related to the Promoter;

You will have no right to withdraw your Bid after the Bid/Issue Closing Date;

You are eligible to apply and hold the Equity Shares Allotted to you together with any Equity Shares held by you prior to the Issue. Further, you confirm that your aggregate holding after the Allotment of the Equity Shares shall not exceed the level permissible as per any applicable regulation;

The Bid made by you would not result in triggering a tender offer under the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, as amended (the “Takeover Regulations”);

Aggregate allotment to you in the Issue, together with other QIBs in the Issue that belong to the same group or are under common control as you, shall not exceed 50.00% of the Issue. For the purposes of this representation:

(a). The expression ‘belong to the same group’ shall derive meaning from the concept of

‘companies under the same group’ as provided in sub-section (11) of Section 372 of the Companies Act, 1956; and

(b). ‘Control’ shall have the same meaning as is assigned to it by Regulation 2(1)(e) of the Takeover Regulations;

You shall not undertake any trade in the Equity Shares credited to your beneficiary account until such

time that the final listing and trading approvals for such Equity Shares are issued by the Stock Exchanges, as applicable;

You are aware that (i) applications for in-principle approval, in terms of Clause 24(a) of the Equity Listing Agreements, for listing and admission of the Equity Shares and for trading on the Stock Exchanges, were made and approval has been received from each of the Stock Exchanges, and (ii) the application for the final listing and trading approvals will be made only after Allotment. There can be

6

no assurance that the final approvals for listing and trading in the Equity Shares will be obtained in time or at all. Our Company shall not be responsible for any delay or non-receipt of such final approvals or any loss arising from such delay or non-receipt;

You are aware and understand that the Book Running Lead Managers have entered into a placement agreement with our Company, whereby the Book Running Lead Managers have, subject to the satisfaction of certain conditions set out therein, severally and not jointly, agreed to manage the Issue and use reasonable efforts to procure subscriptions for the Equity Shares on the terms and conditions set forth therein;

You understand that the contents of this Placement Document are exclusively the responsibility of our Company, and neither the Book Running Lead Managers nor any person acting on their behalf has or shall have any liability for any information, representation or statement contained in this Placement Document or any information previously published by or on behalf of our Company and will not be liable for your decision to participate in the Issue based on any information, representation or statement contained in this Placement Document or otherwise. By accepting a participation in the Issue, you agree to the same and confirm that the only information you are entitled to rely on, and on which you have relied in committing yourself to acquire the Equity Shares is contained in this Placement Document, such information being all that you deem necessary to make an investment decision in respect of the Equity Shares, you have neither received nor relied on any other information, representation, warranty or statement made by or on behalf of the Book Running Lead Managers or our Company or any of their respective affiliates or any other person, and neither the Book Running Lead Managers nor our Company nor any other person will be liable for your decision to participate in the Issue based on any other information, representation, warranty or statement that you may have obtained or received;

You understand that none of the Book Running Lead Managers have any obligation to purchase or acquire all or any part of the Equity Shares purchased by you in the Issue;

You are eligible to invest in India under applicable law, including the FEMA Transfer Regulations, and any notifications, circulars or clarifications issued thereunder, and have not been prohibited by SEBI or any other regulatory authority, from buying, selling or dealing in securities;

You understand that the Equity Shares have not been and will not be registered under the Securities Act or with any securities regulatory authority of any state of the United States and, accordingly, may not be offered, sold or delivered within the United States, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act;

You are, at the time you enter your buy order for the Equity Shares, located outside the United States, and you are not an affiliate of our Company or a person acting on behalf of the company or such an affiliate;

You are not acquiring or subscribing for the Equity Shares as a result of any general solicitation or general advertising (as those terms are defined in Regulation D under the Securities Act) or directed selling efforts (as defined in Regulation S) and you understand and agree that offers and sales are being made outside the United States in off-shore transactions in reliance on Regulation S;

You agree that any dispute arising in connection with the Issue will be governed by and construed in accordance with the laws of India, and the courts in Mumbai, India shall have exclusive jurisdiction to settle any disputes which may arise out of or in connection with the Preliminary Placement Document and the Placement Document;

Each of the representations, warranties, acknowledgements and agreements set out above shall continue to be true and accurate at all times up to and including the Allotment, listing and trading of the Equity Shares in the Issue;

You agree to indemnify and hold our Company and the Book Running Lead Managers harmless from any and all costs, claims, liabilities and expenses (including legal fees and expenses) arising out of or in connection with any breach of the foregoing representations, warranties, acknowledgements and undertakings made by you in this Placement Document. You agree that the indemnity set forth in this

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paragraph shall survive the resale of the Equity Shares by, or on behalf of, the managed accounts; and

Our Company, the Book Running Lead Managers, their respective affiliates and others will rely on the truth and accuracy of the foregoing representations, warranties, acknowledgements and undertakings, which are given to the Book Running Lead Managers on their own behalf and on behalf of our Company, and are irrevocable.

OFF-SHORE DERIVATIVE INSTRUMENTS Subject to compliance with all applicable Indian laws, rules, regulations, guidelines and approvals in terms of Regulation 22 of the SEBI FPI Regulations (as defined below), FPIs (other than Category III foreign portfolio investors and unregulated broad based funds, which are classified as Category II FPI by virtue of their investment manager being appropriately regulated) may issue or otherwise deal in off-shore derivative instruments (as defined under the SEBI FPI Regulations as any instrument, by whatever name called, which is issued overseas by a FPI against securities held by it that are listed or proposed to be listed on any recognised stock exchange in India, as its underlying, and all such off-shore derivative instruments are referred to herein as “P-Notes”), for which they may receive compensation from the purchasers of such instruments. P-Notes may be issued only in favour of those entities which are regulated by any appropriate foreign regulatory authorities subject to compliance with ‘know your client’ requirements. An FPI shall also ensure that no further issue or transfer of any instrument referred to above is made to any person other than such entities regulated by appropriate foreign regulatory authorities. P-Notes have not been and are not being offered or sold pursuant to this Placement Document. This Placement Document does not contain any information concerning P-Notes or the issuer(s) of any P-notes, including any information regarding any risk factors relating thereto.

Any P-Notes that may be issued are not securities of our Company and do not constitute any obligation of, claims on or interests in our Company. Our Company has not participated in any offer of any P-Notes, or in the establishment of the terms of any P-Notes, or in the preparation of any disclosure related to any P-Notes. Any P-Notes that may be offered are issued by, and are the sole obligations of, third parties that are unrelated to our Company. Our Company and the Book Running Lead Managers do not make any recommendation as to any investment in P-Notes and do not accept any responsibility whatsoever in connection with any P-Notes. Any P-Notes that may be issued are not securities of the Book Running Lead Managers and do not constitute any obligations of or claims on the Book Running Lead Managers. Affiliates of the Book Running Lead Managers which are Eligible FPIs may purchase, to the extent permissible under law, the Equity Shares in the Issue, and may issue P-Notes in respect thereof.

Prospective investors interested in purchasing any P-Notes have the responsibility to obtain adequate disclosures as to the issuer(s) of such P-Notes and the terms and conditions of any such P-Notes from the issuer(s) of such P-Notes. Neither SEBI nor any other regulatory authority has reviewed or approved any P-Notes or any disclosure related thereto. Prospective investors are urged to consult their own financial, legal, accounting and tax advisors regarding any contemplated investment in P-Notes, including whether P-Notes are issued in compliance with applicable laws and regulations.

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DISCLAIMER CLAUSE OF THE STOCK EXCHANGES

As required, a copy of this Placement Document has been submitted to each of the Stock Exchanges. The Stock Exchanges do not in any manner:

(i) warrant, certify or endorse the correctness or completeness of the contents of this Placement

Document;

(ii) warrant that the Equity Shares will be listed or will continue to be listed on the Stock Exchanges; or

(iii) take any responsibility for the financial or other soundness of our Company, its Promoters, its management or any scheme or project of our Company;

and it should not for any reason be deemed or construed to mean that this Placement Document has been cleared or approved by the Stock Exchanges. Every person who desires to apply for or otherwise acquire any Equity Shares may do so pursuant to an independent inquiry, investigation and analysis and shall not have any claim against the Stock Exchanges whatsoever, by reason of any loss which may be suffered by such person consequent to or in connection with, such subscription/acquisition, whether by reason of anything stated or omitted to be stated herein, or for any other reason whatsoever.

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PRESENTATION OF FINANCIAL AND OTHER INFORMATION In this Placement Document, unless otherwise specified or the context otherwise indicates or implies, references to ‘you’, ‘your’, ‘offeree’, ‘purchaser’, ‘subscriber’, ‘recipient’, ‘investors’, ‘prospective investors’ and ‘potential investor’ are to the prospective investors in the Issue, references to ‘GIPL’ or the ‘Company’, ‘our Company’, or the ‘Issuer’ are to Gammon Infrastructure Projects Limited and references to ‘we’, ‘us’, ‘our’ or ‘our Group’ are to, where applicable, our Company and its consolidated Subsidiaries and Joint Ventures including entities controlled through contractual arrangements, except as the context otherwise requires. In this Placement Document, all references to “Indian Rupees”, “Rs.” and “₹” are to the legal currency of India, all references to “India” are to the Republic of India and its territories and possessions. References to the singular also refers to the plural and one gender also refers to any other gender, wherever applicable, and the words “Lakh” or “Lac” mean “100 thousand”, the word “million” means “10 lakh”, the word “crore” means “10 million” or “100 lakhs” and the word “billion” means “1,000 million” or “100 crores”. All references herein to the ‘Government’ or ‘GoI’ or the ‘Central Government’ or the ‘State Government’ are to the Government of India, central or state, as applicable. Our Company publishes its Financial Statements in Indian Rupees. The consolidated Financial Statements of our Company as of and for the Financial Years ended March 31, 2012 March 31, 2013 and as of and for the nine month period ended December 31, 2013 included herein have been prepared in accordance with accounting principles generally accepted in India, or Indian GAAP and the Companies Act and have been audited by the Joint Auditors in accordance with the applicable generally accepted auditing standards in India prescribed by the ICAI . The Unaudited Consolidated Interim Condensed Financial Statements as of and for the six month period ended June 30, 2014 has been prepared in accordance with the requirements of Accounting Standards (AS) 25 notified under Companies Act, 1956 read with general circular 8/2014 dated April 4, 2014 issued by Ministry of Corporate Affairs, have been reviewed by the Joint Auditors in accordance with the Standard on Review Engagement (SRE) 2410, ‘Review of Interim Financial Information Performed by the Independent Auditor of the Entity’ issued by the ICAI.

Our Company does not attempt to quantify the impact of U.S. GAAP or IFRS on the financial data included in this Placement Document, nor does our Company provide a reconciliation of its Financial Statements to International Financial Reporting Standards (“IFRS”) or U.S. GAAP. Each of IFRS and U.S. GAAP differ in certain significant respects from Indian GAAP. Accordingly, the degree to which the Financial Statements prepared in accordance with Indian GAAP included in the Preliminary Placement Document and this Placement Document will provide meaningful information is entirely dependent on the reader’s familiarity with the respective accounting practices. Any reliance by persons not familiar with Indian accounting practices on the financial disclosures presented in this Placement Document should accordingly be limited. See section “Risk Factors” on page 49 for further details.

For the sake of presentation in this Placement Document the numericals and other financial information (other than as set out under the section “Financial Information” beginning on page F-1) has been presented in Rupees lakhs. All numerical and financial information as set out and presented in this Placement Document for the sake of consistency and convenience have been rounded off to two decimal places. Accordingly, figures shown as totals in certain tables may not be an arithmetic aggregation of the figures which precede them.

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INDUSTRY AND MARKET DATA Information regarding market position, growth rates and other industry data and certain industry forecasts pertaining to the businesses of our Company contained in this Placement Document consists of estimates based on data reports compiled by government bodies, recognized industry sources, professional organisations and analysts, data from other external sources and knowledge of the markets in which our Company competes. Unless stated otherwise, the statistical information included in this Placement Document relating to the industry in which our Company operates has been reproduced from various trade, industry and government publications and websites. We confirm that such information and data has been accurately reproduced, and that as far as we are aware and are able to ascertain from information published by third parties, no facts have been omitted that would render the reproduced information inaccurate or misleading. This data is subject to change and cannot be verified with certainty due to limits on the availability and reliability of the raw data and other limitations and uncertainties inherent in any statistical survey. Neither our Company nor the Book Running Lead Managers have independently verified this data and do not make any representation regarding the accuracy or completeness of such data. Our Company takes responsibility for accurately reproducing such information but accepts no further responsibility in respect of such information and data.

Certain information in the section “Industry Overview” has been derived from various Indian government publications / industry reports and reports prepared by the Planning Commission, MoRTH, NHAI and MoP, and has not been prepared or independently verified by us, the Book Running Lead Managers or any of our or their respective affiliates or advisors.

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FORWARD-LOOKING STATEMENTS Certain statements contained in this Placement Document that are not statements of law or historical facts constitute ‘forward-looking statements’. Investors can generally identify forward-looking statements by terminology such as ‘aim’, ‘anticipate’, ‘believe’, ‘continue’, ‘can’, ‘could’, ‘estimate’, ‘expect’, ‘intend’, ‘may’, ‘objective’, ‘plan’, ‘potential’, ‘project’, ‘pursue’, ‘shall’, ‘should’, ‘will’, ‘would’, or other words or phrases of similar import. Similarly, statements that describe the strategies, objectives, plans or goals of our Company are also forward-looking statements. However, these are not the exclusive means of identifying forward-looking statements. All statements regarding our Company’s expected financial conditions, results of operations; business plans and prospects are forward-looking statements. These forward-looking statements include statements as to our Company’s business strategy, planned projects, revenue and profitability (including, without limitation, any financial or operating projections or forecasts), new business and other matters discussed in this Placement Document that are not historical facts. These forward-looking statements contained in this Placement Document (whether made by our Company or any third party), are predictions and involve known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, performance or achievements of our Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements or other projections. All forward-looking statements are subject to risks, uncertainties and assumptions about our Company that could cause actual results to differ materially from those contemplated by the relevant forward-looking statement. Important factors that could cause the actual results, performances and achievements of our Company to be materially different from any of the forward-looking statements include, among others:

Our inability to raise the necessary funding for our capital expenditures, including for the development of our projects;

Our ability to complete our current or future projects on time;

Implementation risks that we face due to the long-term nature of our projects;

Our substantial reliance on Government-owned and Government-controlled entities for our revenues;

Any future disruption of our operational projects;

Changing laws, rules, regulations, government policies and legal uncertainties, including adverse application of tax laws and regulations;

Limited flexibility in managing our operations due to regulatory environment in which we operate;

General economic and business conditions in India.

Additional factors that could cause actual results, performance or achievements of our Company to differ materially include, but are not limited to, those discussed under the sections entitled “Risk Factors”, “Industry Overview”, “Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” on pages 49, 117, 127 and 91, respectively. The forward-looking statements contained in this Placement Document are based on the beliefs of the management, as well as the assumptions made by, and information currently available to, the management of our Company. Although our Company believes that the expectations reflected in such forward-looking statements are reasonable at this time, it cannot assure investors that such expectations will prove to be correct. Given these uncertainties, investors are cautioned not to place undue reliance on such forward-looking statements. In any event, these statements speak only as of the date of this Placement Document or the respective dates indicated in this Placement Document and our Company undertakes no obligation to update or revise any of them, whether as a result of new information, future events, changes in assumptions or changes in factors affecting these forward looking statements or otherwise. If any of these risks and uncertainties materialise, or if any of our Company’s underlying assumptions prove to be incorrect, the actual results of operations or financial condition of our Company could differ materially from that described herein as anticipated, believed, estimated or expected. All subsequent forward-looking statements attributable to our Company are expressly qualified in their entirety by reference to these cautionary statements.

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ENFORCEMENT OF CIVIL LIABILITIES Our Company is a public limited company incorporated under the laws of India. All the Directors and the key managerial personnel of our Company named herein are residents of India and all or a substantial portion of the assets of our Company and such persons are located in India. As a result, it may be difficult or may not be possible for investors outside India to effect service of process upon our Company or such persons in India, or to enforce judgments obtained against such parties outside India. Recognition and enforcement of foreign judgments is provided for under Section 13 and Section 44A of the Code of Civil Procedure, 1908, as amended (the “Civil Procedure Code”), on a statutory basis. Section 13 of the Civil Procedure Code provides that a foreign judgment shall be conclusive regarding any matter directly adjudicated upon between the same parties or parties litigating under the same title, except: (i) where the judgment has not been pronounced by a court of competent jurisdiction; (ii) where the judgment has not been given on the merits of the case; (iii) where it appears on the face of the proceedings that the judgment is founded on an incorrect view of international law or a refusal to recognise the law of India in cases in which such law is applicable; (iv) where the proceedings in which the judgment was obtained were opposed to natural justice; (v) where the judgment has been obtained by fraud; and (vi) where the judgment sustains a claim founded on a breach of any law then in force in India. India is not a party to any international treaty in relation to the recognition or enforcement of foreign judgments. However, Section 44A of the Civil Procedure Code provides that a foreign judgment rendered by a superior court (within the meaning of that section) in any jurisdiction outside India which the Government has by notification declared to be a reciprocating territory, may be enforced in India by proceedings in execution as if the judgment had been rendered by a District Court in India. However, Section 44A of the Civil Procedure Code is applicable only to monetary decrees not being in the nature of any amounts payable in respect of taxes or other charges of a like nature or in respect of a fine or other penalties and does not include arbitration awards. Each of the United Kingdom, Republic of Singapore and Hong Kong has been declared by the Government to be a reciprocating territory for the purposes of Section 44A of the Civil Procedure Code, but the United States of America has not been so declared. A judgment of a court in a jurisdiction which is not a reciprocating territory may be enforced only by a fresh suit upon the judgment and not by proceedings in execution. The suit must be brought in India within three years from the date of the foreign judgment in the same manner as any other suit filed to enforce a civil liability in India. It is unlikely that a court in India would award damages on the same basis as a foreign court if an action is brought in India. Furthermore, it is unlikely that an Indian court would enforce foreign judgments if it viewed the amount of damages awarded as excessive or inconsistent with public policy of India. Further, any judgment or award in a foreign currency would be converted into Rupees on the date of such judgment or award and not on the date of payment. A party seeking to enforce a foreign judgment in India is required to obtain approval from the RBI to repatriate outside India any amount recovered, and any such amount may be subject to income tax in accordance with applicable laws.

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EXCHANGE RATES Fluctuations in the exchange rate between the Rupee and foreign currencies will affect the foreign currency equivalent of the Rupee price of the Equity Shares on the Stock Exchanges. These fluctuations will also affect the conversion into foreign currencies of any cash dividends paid in Rupees on the Equity Shares. The following table sets forth information with respect to the exchange rates between the Rupee and the U.S. dollar (in ₹ per US$1.00), for the periods indicated. The exchange rates are based on the reference rates released by RBI, which are available on the website of RBI. No representation is made that any Rupee amounts could have been, or could be, converted into U.S. dollars at any particular rate, the rates stated below, or at all. On September 3, 2014 the exchange rate (RBI reference rate) was ₹ 60.54 to US$ 1.00. (Source: www.rbi.org.in)

Period end Average(1) High(2) Low(3) Financial Year Ended: (₹ Per US$) March 31, 2012 51.16 47.95 54.24 43.95 March 31, 2013 54.39 54.45 57.22 50.56 December 31, 2013 61.90 60.08 68.36 53.74 Quarter ended: September 30, 2013 62.78 62.13 68.36 58.91 December 31, 2013 61.90 62.03 63.65 61.16 March 31, 2014 60.10 61.79 62.99 60.10 June 30, 2014 60.09 59.77 61.12 58.43 Month ended: August 31, 2014 60.47 60.90 61.56 60.43 July 31, 2014 60.25 60.06 60.33 59.72 June 30, 2014 60.09 59.73 60.37 59.06 May 31, 2014 59.03 59.31 60.23 58.43 April 30, 2014 60.34 60.36 61.12 59.65March 31, 2014 60.10 61.01 61.90 60.10

(1) Average of the official rate for each working day of the relevant period. (2) Maximum of the official rate for each working day of the relevant period. (3) Minimum of the official rate for each working day of the relevant period. (Source: www.rbi.org.in)

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DEFINITIONS AND ABBREVIATIONS This Placement Document uses the definitions and abbreviations set forth below, which you should consider when reading the information contained herein. References to any legislation, act or regulation shall be to such term as amended from time to time.

Term Description Articles / Articles of Association Articles of association of our Company, as amended from time to time

AEL Andhra Expressway Limited

AIIPL Aparna Infraenergy India Private Limited

Andhra Expressway Annuity Road Project

Andhra expressway annuity road project from km 253.00 to 300.00 (approximately 47 kms.) on the Dharmavaram -Tuni section of NH-5 in the state of Andhra Pradesh, developed and maintained by AEL.

Aparna Infraenergy Thermal Power Project

A 250MW coal based thermal power project, in Mauza-Kawthala, taluka Chimur, district Chandrapur, in the state of Maharashtra.

Appointed Date Appointed Date, as defined under the respective Concession Agreements.

Audit Committee The audit committee of the Board of Directors described in “Board of Directors and Senior Management” on page 159.

BBHPL Birmitrapur Barkote Highway Private Limited

BST Project Ballard Pier Station Container Terminal

Board of Directors / Board The board of directors of our Company or any duly constituted committee thereof

Capacity Augmentation NHAI’s right to increase the capacity of the Project at anytime after the COD.

CBICL Cochin Bridge Infrastructure Company Limited CICPL Chitoor Infra Company Private Limited Cochin Bridge Project The construction, operation and maintenance of the new Mattencherry

Bridge in Kerela on BOT basis. COD Commercial Operations Date, as defined under the respective

Concession Agreements.

CPL Coastal Projects Limited

CSA Construction Service Agreement

Directors The directors of our Company

Dragadoss Dragadoss Servicious Portuarios Y Logisticos S.L (now known as Noatum Ports S.L)

EIPPL Earthlink Infrastructure Projects Pvt Limited Equity Shares The equity shares of our Company of a face value of ₹ 2 each

Fee A toll or fee levied by NHAI on the vehicles using the Project

Facilities. GICL Gorakhpur Infrastructure Company Limited GIL Gammon India LimitedGLL Gammon Logistics Limited

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Term Description Gorakhpur Annuity Road Project

Gorakhpur annuity road project from 0.00 to 32.27 (approximately 32.27 kms.) on NH-28, in Gorakhpur located in the state of Uttar Pradesh, developed and maintained by GICL.

GPDL Gammon Projects Developers Limited GREIPL Gammon Renewable Energy Infrastructure Projects Limited GRIL Gammon Road Infrastructure Limited GREPL Ghaggar Renewable Energy Private LimitedICTPL Indira Container Terminal Private Limited Joint Auditors M/s Natvarlal Vepari & Co. and M/s S.R. Batliboi & Co. LLP,

statutory auditors of our Company Joint Ventures Blue Water Iron Ore Terminal Private Limited (“BWIOTPL”), Indira

Container Terminal Private Limited (“ICTPL”), GIPL - GIL JV, and SEZ Adityapur Limited

KBICL Kosi Bridge Infrastructure Company Limited

Kosi Bridge Annuity Road Project

Kosi bridge annuity road project, from km. 155.00 to 165.00 (designed chainage: km. 148.550 to 159.185, approximately 10.635 kms.) on NH – 57, in the State of Bihar, developed and maintained by KBICL.

Memorandum or Memorandum of Association or MOA

Memorandum of association of our Company, as amended from time to time

MERC Maharashtra Electricity Regulatory Commission

MNEL

Mumbai Nasik Expressway Limited

MPT Mormugao Port Trust Mumbai Nasik Expressway Toll Road Project

Mumbai Nasik expressway road project, from 539.50 to 440.00 kms (approximately 99.50 kms) on the Vadape-Gonde section of NH-3, in the state of Maharashtra, developed and maintained by MNEL.

Mumbai Off-shore Container Terminal Project

Mumbai off-shore container terminal project, being developed, maintained and operated by ICTPL, with Dragadoss, undertaking the construction of off-shore container berths, development of container terminals in the Mumbai Harbour and operation and management of the Ballard Pier Station Container Terminal.

NH National Highway

O&M Operation and Maintenance Services

OCT Project Off-shore Container Terminal Project

Our Company / the Company / the Issuer / GIPL

Gammon Infrastructure Projects Limited, a public limited company incorporated under the Companies Act, 1956 and having its registered office at Gammon House, Veer Savarkar Marg, Prabhadevi, Mumbai – 400 025

Patna Buxar Toll Road Project Patna Buxar road project, augmentation of existing road by four laning of the Patna-Buxar section on NH – 30 & 84 from km 0.00 to 124.850 (approximately 125.443 kms.), located in the state of Bihar, to be developed and maintained by PBHL.

Patna Highways Annuity Road Project

Patna Highways annuity road project, from km. 0.00 to 46.30 km (approximately 46.30 kms.) and 16.870 kms New bypass starting at km. 46.300 and connecting NH-28 of East – West corridor at 515.045kms. (approximately 63.371 kms.) on Patna-Muzzafarpur section of NH-77, in the state of Bihar, to be developed and maintained by PHPL.

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Term Description PBHL Patna Buxar Highways Limited PHL Pataliputra Highway Limited PHPL Patna Highway Projects Limited Pravara Co-generation Power Project

Pravara co-generation power project, development and operations of 30 MW bagasse-based power co-generation project in Maharashtra, to be developed and maintained by PREL.

PREL Pravara Renewable Energy Limited

Rajahmundry Godavari Toll Road Project

Rajahmundry Godavari road project, a major bridge of length 4.150 kms across the river Godavari in the State of Andhra Pradesh, along with an approach road (approximately 1.933 kms) and approach road on the east Godavari side (approximately 8.405 kms) on NH-5, to be developed and maintained by RGBL.

Rajahmundry Expressway Annuity Road Project

Rajahmundry expressway annuity road project from km 200.00 to 253.00 (approximately 53 kms.) on the Rajahmundry – Dharmavaram section of NH-5 in the state of Andhra Pradesh, developed and maintained by REL

Rangit II Hydroelectric Power Project

Rangit II hydroelectric project, a 66 MW hydroelectric project on the Rimbi river in west Sikkim, to be developed and maintained SHPVL.

RCTPL Ras Cities And Townships Limited

REL Rajahmundry Expressway Limited

RGBL Rajahmundry Godavari Bridge Limited

Road Projects Road Projects shall include, Rajahmundry Expressway Annuity Road Project, Andhra Expressway Annuity Road Project, Kosi Bridge Annuity Road Project, Gorakhpur Annuity Road Project, Mumbai-Nasik Expressway Toll Road Project, Patna Highways Annuity Road Project, Rajahmundry Godavari Toll Road Project, Sidhi Singrauli Toll Road Project, Vijayawada Gundugolanu Toll Road Project and Patna Buxar Toll Road Project.

PDVVPSSKL Padamshri Dr. Vithalrao Vikhe Patil Sahakari Sakhar Karkhana Limited

Port Projects Port Projects shall include Visakhapatnam Port Project and Mumbai Off-shore Container Terminal Projects

Power Projects Power Projects shall include, Pravara Co-generation Power Project, Rangit II Hydroelectric Power Project, Tidong Hydroelectric Power Project, Youngthangkhab Hydroelectric Power Project and Aparna Infraenergy Thermal Power Project.

PPP Public Private Partnership

Promoter Promoter of our Company, being Gammon India Limited1.

Promoter Group Promoter group of our Company as per the definition provided in Regulation 2(1)(zb) of the SEBI Regulations

Registered Office The registered office of our Company is located at Gammon House,

1 Our Promoter, GIL in its board meeting held on August 21, 2014 has approved the sale of 52,80,00,000 Equity

Shares held by GIL to its subsidiary Gammon Power Limited.

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Term Description Veer Savarkar Marg, Prabhadevi, Mumbai 400 025

Registrar of Companies/RoC The Registrar of Companies, Maharashtra

SIPPL Segue Infrastructure Projects Private Limited SHPVL Sikkim Hydro Power Ventures Limited

Sidhi Singrauli Toll Road Project

Sidhi Singrauli road project, on NH – 75E from km 83.4 to 195.8 (approximately 102.60 kms.), located in the state of Madhya Pradesh, to be developed and maintained SSRPL.

SPV Special Purpose Vehicle

SREPL Sutluj Renewable Energy Private Limited SSA Sale and Subscription Agreement

SSRPL Sidhi Singrauli Road Project Limited

Subsidiaries Andhra Expressway Limited, Aparna Infraenergy India Private

Limited, Birmitrapur Barkote Highway Private Limited, Cochin Bridge Infrastructure Company Limited, Chitoor Infrastructure Company Private Limited, Earthlink Infrastructure Projects Private Limited, Gammon Logistics Limited, Gammon Projects Developers Limited, Gammon Renewable Energy Infrastructure Projects Limited, Gammon Road Infrastructure Limited, Gammon Seaport Infrastructure Limited, Ghaggar Renewable Energy Private Limited, Gorakhpur Infrastructure Company Limited, Haryana Biomass Power Limited, Jaguar Projects Developers Limited, Kosi Bridge Infrastructure Company Limited, Lilac Infraprojects Developers Limited, Marine Project Services Limited, Mormugao Terminal Limited, Mumbai Nasik Expressway Limited, Patna Buxar Highways Limited, Pataliputra Highways Limited, Patna Highway Projects Limited, Pravara Renewable Energy Limited, Ras Cities and Townships Private Limited, Rajahmundry Expressway Limited, Rajahmundry Godavari Bridge Limited, Satluj Renewable Energy Private Limited, Sidhi Singrauli Road Project Limited, Sikkim Hydro Power Ventures Limited, Segue Infrastructure Projects Private Limited, Tada Infra Development Company Limited, Tangri Renewable Energy Private Limited, Tidong Hydro Power Limited, Vijayawada Gundugolanu Road Project Private Limited, Vizag Seaport Private Limited, Yamuna Minor Minerals Private Limited, Yamunanagar Panchkula Highway Private Limited, Youngthang Power Ventures Limited

THPL Tidong Hydro Power Limited

Tidong Hydroelectric Power Project

Tidong hydroelectric power project, a 60 MW hydroelectric project in the Kinnaur district of Himachal Pradesh on river Tidong to be developed and maintained by THPL.

TPL Torrent Power Limited

VGRPPL Vijayawada Gundugolanu Road Project Private Limited

Vijayawada Gundugolanu Toll Road Project

Vijayawada Gundugolanu road project, augmentation of existing NH-5 total length approximately 103.59 kms, located in the state of Andhra Pradesh, to be developed and maintained by VGRPPL;

Visakhapatnam Port Project Visakhapatnam port project, which is developed, operated, and

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Term Description maintained by VSPL.

VPT Visakhapatnam port Trust

VSPL Vizag Seaport Private Limited

YPHPL Yamunanagar Panchkula Highway Private Limited

YMMPL Yamunanagar Minor Minerals Private Limited

Youngthangkhab Hydroelectric Power Project

Youngthangkhab Hydroelectric project, a 261 MW hydroelectric power project in the state of Himachal Pradesh, to be developed and maintained by YPVL.

YPHPL Yamunanagar Panchkula Highway Private Limited

YPVL Youngthang Power Ventures Limited

we / us / our / our Group

Our Company and its Subsidiaries and Joint Ventures including entities controlled through contractual arrangements and the associates, except as the context otherwise requires

Issue Related Terms

Term Description Allocated / Allocation The allocation of Equity Shares following the determination of the

Issue Price to QIBs on the basis of the Application Form submitted by them, by our Company in consultation with the Book Running Lead Managers and in compliance with Chapter VIII of the SEBI Regulations

Allot / Allotment / Allotted Unless the context otherwise requires, the issue and allotment of Equity Shares to be issued pursuant to the Issue

Allottees QIBs to whom Equity Shares are issued and Allotted pursuant to the Issue

Application Form The form (including any revisions thereof) pursuant to which a QIB shall submit a Bid for the Equity Shares in the Issue

Bid(s) Indication of interest of a Bidders, including all revisions and modifications thereto, as provided in the Application Form, to subscribe for the Equity Shares

Bid/Issue Closing Date September 4, 2014, which is the last date up to which the Application Forms shall be accepted

Bid/Issue Opening Date September 1, 2014 Bid/Issue Period Period between the Bid/Issue Opening Date and the Bid/Issue Closing

Date, inclusive of both days, during which prospective Bidders can submit their Bids

Bidder Any prospective investor, being a QIB, who makes a Bid pursuant to the terms of this Placement Document and the Application Form

Book Running Lead Managers Inga Capital Private Limited, IDFC Securities Limited, Equirus Capital Private Limited and ICICI Securities Limited

BOLT BSE On-line Trading CAN or Confirmation of Allocation Note

Note or advice or intimation to QIBs confirming Allocation of Equity Shares to such QIBs after determination of the Issue Price and requesting payment for the entire applicable Issue Price for all Equity Shares Allocated to such QIBs

Closing Date The date on which Allotment of Equity Shares pursuant to the Issue shall be made, i.e. on or about September 8, 2014

Cut-off Price The Issue Price of the Equity Shares to be issued pursuant to the Issue which shall be finalised by our Company in consultation with the Book Running Lead Managers

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Term Description Designated Date The date of credit of Equity Shares to the QIB’s dematerialised

account, as applicable to the respective QIB Equity Listing Agreement(s) The agreement entered into by our Company with each of the Stock

Exchanges in relation to listing of the Equity Shares, on each of the Stock Exchanges

Escrow Agreement Agreement dated September 1, 2014, entered into amongst our Company, the Escrow Bank and the Book Running Lead Managers for collection of the Bid Amounts and for remitting refunds, if any, of the amounts collected, to the Bidders.

Escrow Bank Yes Bank Limited, IFC Tower 2, 8th Floor, Senapati Bapat Marg, Elpinstone (W), Mumbai – 400 013

Escrow Bank Account The account entitled “Gammon Infra – QIP Escrow Account” with regard to any money received towards the subscription of the Equity Shares, opened with the Escrow Bank, subject to the terms of the Escrow Agreement

Equity Shares Equity Shares of our Company of ₹ 2 each, fully paid-up unless otherwise specified in the context thereof.

Floor Price The floor price of ₹ 13.3375 which has been calculated in accordance with Chapter VIII of the SEBI Regulations. In terms of the SEBI Regulations, the Issue Price cannot be lower than the Floor Price. The QIP Committee has on September 4, 2014 approved a discount of ₹ 0.6575 to the floor price in terms of Regulation 85 of SEBI Regulations.

Issue The offer, issue and Allotment of 20,41,74,286 Equity Shares to QIBs pursuant to Chapter VIII of the SEBI Regulations and the provisions of the Companies Act, 2013

Issue Price ₹ 12.68 per Equity Share Issue Size The issue of up to 20,41,74,286 Equity Shares aggregating up to ₹

25,889.30 lakhs Mutual Fund A mutual fund registered with SEBI under the Securities and Exchange

Board of India (Mutual Funds) Regulations, 1996, as amended Mutual Fund Portion 10.00% of the Equity Shares proposed to be Allotted in the Issue,

which is available for Allocation to Mutual Funds Pay-in Date The last date specified in the CAN for payment of application monies

by the successful Bidders Placement Agreement Placement agreement dated September 1, 2014, entered into by our

Company and the Book Running Lead Managers Placement Document This placement document to be issued by our Company in accordance

with Chapter VIII of the SEBI Regulations and Section 42 of the Companies Act, 2013

Preliminary Placement Document The preliminary placement document dated September 1, 2014 issued in accordance with Chapter VIII of the SEBI Regulations and Section 42 of the Companies Act, 2013

QIBs or Qualified Institutional Buyers

Qualified institutional buyers as defined under Regulation 2(1)(zd) of the SEBI Regulations or such other persons as maybe permitted by applicable laws to acquire the Equity Shares to be issued pursuant to the Issue

QIP Qualified institutions placement under Chapter VIII of the SEBI Regulations

Regulation S Regulation S under the Securities Act Relevant Date September 1, 2014 which is the date of the meeting of the Board, or

any committee duly authorised by the Board, deciding to open the Issue

Securities Act The U.S. Securities Act of 1933, as amended and the related rules and regulations promulgated thereunder

U.S. person “U.S. person” as defined in Regulation S

20

Conventional and general terms

Term Description ₹ / INR / Rupees/ Rs. Indian Rupees AGM Annual general meeting AIF(s) Alternative investment funds, as defined and registered with SEBI under the

Securities and Exchange Board of India (Alternative Investment Funds) Regulations, 2012, as amended

APRDC Andhra Pradesh Road Development Corporation AS Accounting Standards issued by ICAI BOO With respect to a project, a contract to build, own and operate such project BOOT With respect to a project, a contract to build, own and operate such project

and to subsequently transfer the ownership and/or operations of such project to a third party upon the occurrence of a specified date or event.

BOT With respect to a project, a contract to build, operate and transfer the ownership and/or operations of such project to a third party upon the occurrence of a specified date or event

BSE BSE Limited CAGR Compound annual growth rate Calendar Year Year ending on December 31 Category III Foreign Portfolio Investor

An FPI registered as a category III foreign portfolio investor under the SEBI FPI Regulations

CARO Companies Auditors Report Order, 2003 CCI Competition Commission of India CDR Corporate Debt Restructuring CDSL Central Depository Services (India) Limited CERC Central Electricity Regulatory Commission CEA Central Electricity Authority CEGAT Customs, Excise and Gold(Control) Appellate Tribunal CESTAT Central Excise & Service Tax Appellate Tribunal CGU Cash Generating UnitCIL Coal India Limited CIN Corporate Identity Number Civil Procedure Code The Code of Civil Procedure, 1908 CLB Company Law Board COD With respect to a project, the commercial operation date of such project,

being the date that such project commences operations Companies Act Companies Act, 1956 and/or the Companies Act, 2013, as applicable Companies Act, 1956 Companies Act, 1956, as amended (without reference to the provisions

thereof that have ceased to have effect upon the notification of the Notified Sections) and the rules made thereunder

Companies Act, 2013 Companies Act, 2013, to the extent in force pursuant to the notification of the Notified Sections, and the rules made thereunder

Competition Act The Competition Act, 2002, as amended Consolidated FDI Policy Circular 1 of 2014 issued by the Department of Industrial Policy and

Promotion, Ministry of Commerce and Industry, Government, effective from April 17, 2014 as amended from time to time

Cr.P.C The Code of Criminal Procedure, 1973 Crore 100 lakhs Debt to equity ratio Debt to equity ratio is calculated as total borrowings/networth Depositories NSDL and CDSL Depositories Act The Depositories Act, 1996 Depository Participant or DP A depository participant as defined under the Depositories Act

21

Term Description Development With respect to a project, that such project is in the initial planning and land

acquisition stage and that such project has not yet achieved Financial Closure

DIPP Department of Industrial Policy and Promotion, Ministry of Commerce and Industry.

DMRC Delhi Metro Rail Corporation Limited DP ID Depository participant identity DRT Debt Recovery Tribunal DRAT Debt Recovery Appellate Tribunal DTA Zone A domestic tariff area, which is an area within India that is adjacent to but

outside a SEZ EBITDA Earnings before interest, tax, depreciation and amortization ECB External Commercial BorrowingECS Electronic clearing service EGM Extraordinary general meeting Electricity Act The Electricity Act, 2003, as amended Eligible FPIs FPIs that are eligible to participate in this Issue and do not include qualified

foreign investors and Category III Foreign Portfolio Investors who are not allowed to participate in the Issue

EOM Emphasis of Matters as per Standard on Auditing (SA) 706 (Emphasis of Matters paragraphs and other matter paragraphs in the Independent Auditors Report)

EPC Engineering, procurement and construction EPS Earnings per share, i.e., profit after tax for a Financial Year divided by the

weighted average number of equity shares during the Financial Year ERC Act Electricity Regulatory Commissions Act, 1998 EU European Union FDI Foreign direct investment FEMA The Foreign Exchange Management Act, 1999, together with rules and

regulations thereunder FEMA Transfer Regulations Foreign Exchange Management (Transfer or Issue of Security by a Person

Resident Outside India) Regulations, 2000, as amended FII Regulations The Securities and Exchange Board of India (Foreign Institutional

Investors) Regulations, 1995 FIIs Foreign Institutional Investors as defined under the SEBI FPI Regulations Financial Closure With respect to a project, that all necessary funding has been secured for

such project. Upon financial closure the relevant project moves from the development stage to the implementation stage

Financial Statements Consolidated or the standalone audited financial statements of our Company or the Subsidiaries or Joint Ventures, as the context may require, for each Financial Year.

Financial Year or FY Refers to the 12 month period ended March 31, 2012 and 2013 and the nine months period ended December 31, 2013. The current Financial Year commences on January 1 and ends on December 31.

FIPB Foreign Investment Promotion Board FIR First Information Report Form PAS-4 Form PAS-4 prescribed under the Companies (Prospectus and Allotment of

Securities) Rules, 2014 FPI Foreign portfolio investors as defined under the SEBI FPI Regulations and

includes person who has been registered under the SEBI FPI Regulations. Any foreign institutional investor or qualified foreign investor who holds a valid certificate of registration is deemed to be a foreign portfolio investor till the expiry of the block of three years for which fees have been paid as per the Securities and Exchange Board of India (Foreign Institutional Investors) Regulations, 1995

22

Term Description FVCI Foreign Venture Capital Investors (as defined under the SEBI (Foreign

Venture Capital Investors) Regulations, 2000) registered with the SEBI GAAP Generally Accepted Accounting Principles GCDA Greater Cochin Development Authority GDP Gross Domestic Product General Meeting AGM or EGM GoI or Government Government of India GoAP Government of Andhra Pradesh GoHP Government of Himachal Pradesh GoK Government of Kerala GoS Government of Sikkim GIPL ESOP 2013 Means the employee stock option of the Company known as ESOP Scheme

GIPL ESOP 2013 GW Giga Watt HMC Harbour Mobile Cranes HUF Hindu Undivided Family I.T. Act The Income Tax Act, 1961 ICA Indian Council of Arbitration ICAI Institute of Chartered Accountants of India ICRA ICRA Limited IFCI Industrial Finance Corporation of India IFRS International Financial Reporting Standards Implementation With respect to a project, that such project has achieved Financial Closure IND-AS Indian accounting standards converged with IFRS, which has been proposed

for implementation by the ICAI Indian GAAP Generally accepted accounting principles in India Insider Trading Regulations The Securities and Exchange Board of India (Prohibition of Insider Trading)

Regulations, 1992 Insurance Act The Insurance Act, 1938 IPA Indian Ports Association IPC The Indian Penal Code,1860 IRDA Insurance Regulatory and Development Authority JNPT Jawaharlal Nehru Port Trust JV Joint Venture Lakh 100 thousand Land Acquisition Act, 2013 Right to Fair Compensation and Transparency in Land Acquisition,

Rehabilitation and Resettlement Act, 2013 MAT Minimum Alternate Tax MCA Ministry of Corporate Affairs, GoI MERC Maharashtra Electricity Regulatory Commission MIS Management Information Systems MMRDA Mumbai Metro Region Development Authority MMDR Act, 1957 Mines and Minerals (Development and Regulation) Act, 1957 MoEF Ministry of Environment and Forests MoF Ministry of Finance MoP Ministry of Power MoRTH Ministry of Road Transport and Highways MoU Memorandum of Understanding MSRDC Maharashtra State Road Development Corporation MT Million Tonnes MTOE Million Tonnes of Oil Equivalent MTPA Million Tonnes per annum MW Mega watt NEFT National Electronic Fund Transfer Net Worth Net worth comprises share capital and reserves and surplus and is adjusted

for miscellaneous expenditure to the extent not written off NHAI National Highways Authority of India

23

Term Description NHAI Act The National Highways Act, 1956 NHDP National Highway Development Programme NHPC National Hydro Power Corporation Non-Resident or NR A person resident outside India, as defined under the FEMA and includes a

Non-Resident Indian Notified Sections Sections of the Companies Act, 2013 that have been notified by the

Government of IndiaNEP National Electricity Policy NTP National Tariff Policy NRI A person resident outside India, who is a citizen of India or a person of

Indian origin and shall have the same meaning as ascribed to such term in the Foreign Exchange Management (Deposit) Regulations, 2000, as amended

NSDL National Securities Depository Limited NSE National Stock Exchange of India Limited OCB or Overseas Corporate Body

A company, partnership, society or other corporate body owned directly or indirectly to the extent of at least 60% by NRIs including overseas trusts in which not less than 60% of the beneficial interest is irrevocably held by NRIs directly or indirectly and which was in existence on October 3, 2003 and immediately before such date was eligible to undertake transactions pursuant to the general permission granted to OCBs under the FEMA. OCBs are not allowed to invest in the Issue

Official Gazette The official gazette of India or a State ONGC Oil and Natural Gas Corporation Limited PPA Power Purchase Agreement P.A. Per annum PAN Permanent Account Number allotted under the I.T. Act PMI Purchasing Managers Index PNG Petroleum and Natural Gas Planning Commission An Institution in the Government of India, which formulates India’s Five

Year Plans. PWD Public Works DepartmentQFI Qualified foreign investor as defined under the SEBI FPI Regulations RBI Reserve Bank of India RTA Regional Transport Authority RTGS Real Time Gross Settlement SAIL Steel Authority of India SARDP-NE Special Accelerated Road Development Programmes in North East SCRA The Securities Contracts (Regulation) Act, 1956 as amended SCRR The Securities Contracts (Regulation) Rules, 1957 as amended SEBI The Securities and Exchange Board of India established under the SEBI Act SEBI Act The Securities and Exchange Board of India Act, 1992 as amended SEBI FPI Regulations The Securities and Exchange Board of India (Foreign Portfolio Investors)

Regulations, 2014, as amended SEBI Insider Trading Regulations

The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992, as amended

SEBI Regulations The SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009 as amended

SEBI Takeover Regulations The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, as amended

SEBs State Electricity Boards SEC The U.S. Securities Exchange Commission Securities Act The United States Securities Act of 1933, as amended SERC State Electricity Regulatory Commission

24

Term Description SEZ Special economic zone, which is an area that is subject to certain tax

benefits and, in particular, is a duty-free, license-free, entrepreneurial-friendly and environmentally-conducive enclave that is primarily directed towards export-oriented activities

SEZ Act The Special Economic Zones Act, 2005 as amended SLM Straight Line Method STL Short term liability Stock Exchanges The BSE and the NSE STT Securities Transaction Tax Supreme Court The Supreme Court of India TAMP Tariff Authority for Major Ports TEU Twenty-foot Equivalent Unit TLP Trademark Licence Agreement Unaudited Consolidated Interim Condensed Financial Statements

The consolidated interim condensed balance sheet of the Group as at June 30, 2014 and the related consolidated interim condensed statement of profit and loss for the six month period ended June 30, 2014 and the consolidated interim condensed statement of cash flow for the six month period ended June 30, 2014 prepared in accordance with the principles laid down in Accounting Standard 25 “Interim Financial Reporting”, notified under the Companies Act, 1956 read with General Circular 8/2014 dated 4 April 2014 issued by the Ministry of Corporate Affairs and the recognition and measurement principles of Indian GAAP and reviewed by the Joint Auditors.

U.S.A United States of America U.S. GAAP Generally accepted accounting principles in the United States of America VCF A Venture Capital Fund as defined and registered with SEBI under the

Securities and Exchange Board of India (Alternative Investment Funds) Regulations, 2012 or the erstwhile Securities and Exchange Board of India (Venture Capital Funds) Regulations, 1996, as the case may be

VGF Viability Gap Funding WPI Wholesale Price Index

25

DISCLOSURE REQUIREMENTS UNDER FORM PAS-4 PRESCRIBED UNDER THE COMPANIES ACT, 2013 AND THE RULES MADE THEREUNDER

The table below sets out the disclosure requirements as provided in PAS-4 and the relevant pages in this Placement Document where these disclosures, to the extent applicable, have been provided. Sr. No.

Disclosure Requirements Relevant Page of this Placement Document

1. GENERAL INFORMATION a. Name, address, website and other contact details of the Company indicating

both Registered Office and Corporate Office 237

b. Date of incorporation of the Company Cover Page and 233 c. Business carried on by the Company and its subsidiaries with the details of

branches or units, if any 127 to 158

d. Brief particulars of the management of the Company 159 – 168 e. Names, addresses, DIN and occupations of the directors 159 – 160 f. Management’s perception of risk factors 49 – 82 g. Details of default, if any, including therein the amount involved, duration of

default and present status, in repayment of –

i) statutory dues 219 - 220ii) debentures and interest thereon 219 – 220iii) deposits and interest thereon 219 – 220 iv) loan from any bank or financial institution and interest thereon 219 – 220 h. Names, designation, address and phone number, email ID of the nodal/

compliance officer of the Company, if any, for the private placement offer process

237

2. PARTICULARS OF THE OFFER a. Date of passing of board resolution 233 b. Date of passing of resolution in the general meeting, authorizing the offer of

securities 233

c. Kinds of securities offered (i.e. whether share or debenture) and class of security

Cover Page and 36

d. price at which the security is being offered including the premium, if any, along with justification of the price

Cover Page and 36

e. name and address of the valuer who performed valuation of the security offered

Not Applicable

f. Amount which the Company intends to raise by way of securities Cover Page and 86 g. Terms of raising of securities: Duration, if applicable Not Applicable Rate of dividend Not Applicable Rate of interest Not Applicable Mode of payment Not Applicable Repayment Not Applicable

h. Proposed time schedule for which the offer letter is valid 18 i. Purposes and objects of the offer 86 j. contribution being made by the promoters or directors either as part of the

offer or separately in furtherance of such objects 86

k. Principle terms of assets charged as security, if applicable Not Applicable 3. DISCLOSURES WITH REGARD TO INTEREST OF DIRECTORS,

LITIGATION ETC.

a. Any financial or other material interest of the directors, promoters or key managerial personnel in the offer and the effect of such interest in so far as it is different from the interests of other persons

161 – 166

b. Details of any litigation or legal action pending or taken by any Ministry or Department of the Government or a statutory authority against any promoter of the offeree company during the last three years immediately preceding the year of the circulation of the offer letter and any direction issued by such Ministry or Department or statutory authority upon conclusion of such litigation or legal action shall be disclosed

211 - 231

26

Sr. No.

Disclosure Requirements Relevant Page of this Placement Document

c. remuneration of directors (during the current year and last three Financial Years)

163 – 164

d. Related party transactions entered during the last three Financial Years immediately preceding the year of circulation of offer letter including with regard to loans made or, guarantees given or securities provided

168

e. Summary of reservations or qualifications or adverse remarks of auditors in the last five Financial Years immediately preceding the year of circulation of offer letter and of their impact on the Financial Statements and financial position of the company and the corrective steps taken and proposed to be taken by the Company for each of the said reservations or qualifications or adverse remark

42-47

f. Details of any inquiry, inspections or investigations initiated or conducted under the Companies Act, 2013 or any previous company law in the last three years immediately preceeding the year of circulation of offer letter in the case of the Company and all of its subsidiaries. Also if there were any prosecutions filed (whether pending or not) fines imposed, compounding of offences in the last three years immediately preceding the year of the offer letter and if so, section-wise details thereof for the Company and all of its subsidiaries

219

g. Details of acts of material frauds committed against the Company in the last three years, if any, and if so, the action taken by the Company

219

4. FINANCIAL POSITION OF THE COMPANY a. the capital structure of the Company in the following manner in a tabular

form-

(i)(a) the authorised, issued, subscribed and paid up capital (number of securities, description and aggregate nominal value)

88

(b) size of the present offer 88 (c) paid up capital 88 (A) after the offer 88 (B) after conversion of convertible instruments (if applicable) Not Applicable (d) share premium account (before and after the offer) 88 (ii) the details of the existing share capital of the issuer company in a tabular

form, indicating therein with regard to each allotment, the date of allotment, the number of shares allotted, the face value of the shares allotted, the price and the form of consideration

88 – 89

Provided that the issuer company shall also disclose the number and price at which each of the allotments were made in the last one year preceding the date of the offer letter separately indicating the allotments made for considerations other than cash and the details of the consideration in each case

Not Applicable

b. Profits of the Company, before and after making provision for tax, for the three Financial Years immediately preceding the date of circulation of offer letter

F – 1 to F-125

c. Dividends declared by the Company in respect of the said three financial years; interest coverage ratio for last three years (Cash profit after tax plus interest paid/interest paid)

90

d. A summary of the financial position of the Company as in the three audited balance sheets immediately preceding the date of circulation of offer letter

38 – 48

e. Audited cash flow statement for the three years immediately preceding the date of circulation of offer letter

40 – 42

f. Any change in accounting policies during the last three years and their effect on the profits and the reserves of the Company

47 – 48

5. A DECLARATION BY THE DIRECTORS THAT - 236 a. the Company has complied with the provisions of the Act and the rules made

thereunder b. the compliance with the Act and the rules does not imply that payment of

dividend or interest or repayment of debentures, if applicable, is guaranteed

27

Sr. No.

Disclosure Requirements Relevant Page of this Placement Document

by the Central Government c. the monies received under the offer shall be used only for the purposes and

objects indicated in the Offer letter

28

SUMMARY OF BUSINESS

We were incorporated in April 2001 with a focus on participating in infrastructure project development undertaking PPP projects and other infrastructure projects involving private financial participation in various sectors on build operate transfer (BOT) and other allied basis. We are a part of the Gammon Group, which is a diversified business group with civil engineering and construction as its major business interests. GIL, our Promoter and the flagship company of the Gammon Group, is among the leading construction companies in India specialising in design and construction in the areas of transportation, engineering, industrial structures, energy projects, high rise structures, bulk storage facilities, foundation engineering, hydraulic works, irrigation projects and controlled demolition techniques. We operate as an infrastructure holding company with interests in sectors such as roads, ports and power through SPVs responsible for carrying on specific projects being undertaken by us. Our current portfolio of projects consists of 17 projects in the roads, ports and power sector, of which 6 projects have commenced commercial operations (“Operations Phase”), 8 projects have achieved Financial Closure or have achieved Financial Closure but are under revalidation and have commenced development or are in advanced stages to commence development (“Development Phase”) and 3 projects are in initial stages of project lifecycle and yet to achieve Financial Closure (“Pre-development Phase”). Our Company also undertakes services in other areas of project development, such as construction contracts, project advisory services, project management and operations and maintenance activities, which we provide to entities in our Group. Our key assets across the sectors as on date are set out below: Phases Roads Sector Ports Sector Power Sector

Operations Phase

1. Rajahmundry Expressway Annuity Road Project (kms. 200.00 to 253.00 on NH-5)

2. Andhra Expressway Annuity Road Project (Kms. 253.00 to 300.00 on NH-5)

3. Kosi Bridge Annuity Road Project (including approaches and bunds) (Kms. 155.00 to 165.00 on NH-57)

4. Gorakhpur Annuity Road Project (kms. 0.00 to 32.27 of Gorakhpur bypass on NH-28)

5. Mumbai Nasik Expressway Toll Road Project (kms. 539.50 to 440.00 on NH-3)

1. Visakhapatnam Port Project (operating 2 berths for multipurpose cargo handling)

Development Phase

1. Patna Highways Annuity Road Project (kms. 0.00 to 46.30 on NH-77 and 16.870 kms new bypass starting at km 46.300 on NH-77)

2. Rajahmundry Godavari Toll Road Project (kms. 82/40 to on EGK* road to 197/4 on NH-5)

3. Sidhi Singrauli Toll Road

1. Mumbai Off-shore Container Terminal Project

1. Pravara Co-generation Power Project (30 MW)

2. Rangit II Hydroelectric Power Project (66 MW)

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Phases Roads Sector Ports Sector Power Sector

Project (Kms. 83/40 to 195/80 on NH-75E)

4. Vijayawada Gundugolanu Toll Road Project (kms. 1076.48 to 1022.48 on NH-5)

5. Patna Buxar Toll Road Project (kms. 0.00 to 124.85 on NH-30 including bypass section on NH-84)

Pre-Development Phase

1. Tidong Hydroelectric Power Project (60 MW)

2. Youngthangkhab Hydroelectric Power Project (261 MW)

3. Aparna Infraenergy Thermal Power Project (250 MW)

* Eluru-Gundugolanu-Kovvur (EGK) Our Road Business Our infrastructure projects under the road sector currently comprise of 10 projects, out of which 5 are in Operations Phase and 5 are under Development Phase. The following road projects are in the Operations Phase: Rajahmundry Expressway Annuity Road Project: strengthening of the existing 2 lanes and widening of the

same to 4 lane dual carriageway from kms. 200.00 to 253.00 (approximately 53 kms.) on the Rajahmundry – Dharmavaram section of NH-5 in the state of Andhra Pradesh, being developed and maintained by our SPV, REL, which commenced commercial operations on September 20, 2004;

Andhra Expressway Annuity Road Project: strengthening of the existing 2 lanes and widening thereof to 4

lane dual carriageway, from kms. 253.00 to 300.00 (approximately 47 kms.) on the Dharmavaram-Tuni section of NH-5 in the state of Andhra Pradesh, being developed and maintained by our SPV, AEL, which commenced commercial operations on October 30, 2004;

Kosi Bridge Annuity Road Project: designing, construction, financing, maintenance and operation of a 4 –

lane Bridge across the river Kosi (including its approaches and guide bund and afflux bund) from kms. 155.00 to 165.00 (designed chainage: kms. 148.550 to 159.185, approximately 10.635 kms.) on NH – 57 , in the State of Bihar and is being developed and maintained by our SPV, KBICL, which commenced commercial operations on February 8, 2012;

Gorakhpur Annuity Road Project: designing, construction, financing, maintenance and operation of a

bypass from kms. 0.00 to 32.27 (approximately 32.27kms.) on NH – 28, in Gorakhpur located in the state of Uttar Pradesh and is being developed and maintained by our SPV, GICL, which commenced commercial operations on March 31, 2012; and

Mumbai Nasik Expressway Toll Road Project: envisaging improvement, operation, maintenance,

rehabilitation and strengthening of the existing 2- lane road and widening the same to 4 –lane divided highway, from kms. 539.50 to 440.00 (approximately 99.50 kms.) on the Vadape – Gonde section of NH-3,

30

located in the state of Maharashtra and is being developed and maintained by our SPV, MNEL, which commenced partial operations on May 11, 2010 and full operations on July 11, 2011. The final COD was achieved in June 2012.

The following roads projects are in the Development Phase: Patna Highways Annuity Road Project: upgradation of Hajipur-Muzzafarpur section of the existing NH-77

to four lane dual carriageway, from kms. 0.00 to 46.30 (approximately 46.30 kms.) and construction of 16.870 kms. New bypass starting at km. 46.300 and connecting NH-28 of East – West corridor at 515.045 kms. (total length approximately 63.371 kms.) on Patna-Muzzafarpur section of NH-77, in the state of Bihar, being developed and maintained by our SPV. PHPL, was supposed to commence commercial operations from August, 2014.

Rajahmundry Godavari Toll Road Project: designing, construction, financing, maintenance and operation of

a major bridge across river Godavari with approach roads starting at km 82.4 of Eluru-Gundugolanu-Kovvur road on Kovvur side joining NH-15 at km 197.4 on Rajahmundry side in the State of Andhra Pradesh being developed and maintained by our SPV, RGBL, which is expected to commence commercial operations in March, 2015;

Sidhi Singrauli Toll Road Project: augmentation of existing road by four laning of Sidhi – Singrauli section

on NH – 75E from kms. 83.4 to 195.8 (approximately 102.60 kms.), located in the State of Madhya Pradesh, being developed and maintained by our SPV, SSRPL, which is expected to commence its commercial operations within 730 days from the appointed date (i.e. September 19, 2013);

Vijayawada Gundugolanu Toll Road Project: augmentation of existing NH-5 by six laning of Vijayawada –

Gundugolanu section from kms. 1076.48 to 1022.48, including 6 lane Hanuman Junction by pass, (i.e. 6.72 kms.) and 4 – lane Vijayawada bypass (approximately 47.88 kms.) (total length approximately 103.59 kms.), located in the state of Andhra Pradesh, to be developed and maintained by our SPV, VGRPPL, which is expected to commence its commercial operations within 912 days from the appointed date (as defined under the concession agreement). The appointed date has been notified as September 1, 2014. Tolling operations at the two toll booths of Vijayawada Gundugolanu Toll Road Project has commenced with effect from September 1, 2014; and

Patna Buxar Toll Road Project: augmentation of existing road by four laning of the Patna-Buxar section on NH – 30 & NH - 84 from kms. 0.00 to 124.850 (total length approximately 125.443 kms.), located in the state of Bihar, proposed to be developed and maintained by our SPV, PBHL.

Our Port Business Our projects under the port sector currently comprises of 2 projects, out of which 1 is in its Operations Phase and 1 is under its Development Phase. The following port project is in its Operations Phase: Visakhapatnam Port Project: developed and maintained by our SPV, VSPL, operating two multipurpose

berths for handling coal, lime stone, rock phosphate, sulphur and other bulk cargo or general cargoes or liquid bulk cargo (non-hazardous) at Visakhapatnam port which commenced commercial operations on July 24, 2004 and September 8, 2005. Vide letter dated January 28, 2014, VPT has granted leasehold rights to VSPL on additional land admeasuring 30 acres for the purpose of storage and handling of cargo.

The following port project is in its Development Phase: Mumbai Port Project: operation and management including necessary developments, modifications and

augmentation of facilities, of the Ballard Pier Station Container Terminal and development, construction, operation and management of an off-shore container terminal in the Mumbai Harbour proposed to be developed, maintained and operated by our SPV, ICTPL, which is expected to commence commercial operations from January 31, 2016.

Our Power Business

31

Our projects under the power sector currently comprise of 5 projects, out of which 2 are in their Development Phase and 3 are in their Pre-development Phase. The following power projects are under Development Phase: Pravara Co-generation Power Project: development and operations of a 30 MW bagasse-based power co-

generation project in Pravara Nagar, Taluka Rahata, District Ahmednagar, Maharashtra, proposed to be developed and maintained by our SPV, PREL, which was supposed to commence commercial operations from September 1, 2014; and

Rangit II Hydroelectric Project: development and operations of a 66 MW hydroelectric project on the

Rimbi river in West Sikkim, proposed to be developed and maintained by our SPV, SHPVL, which is expected to commence from December 8, 2015 as per the letter received from Government of Sikkim dated February 10, 2010. However, the Company expects the commercial operations to commence within 3 years from the date of first disbursement of the debt component from the lenders.

The following power projects are under the Pre-Development Phase: Tidong Hydroelectric Power Project: a 60 MW hydroelectric project in District Kinnaur in Himachal

Pradesh on the river Tidong (a tributary of river Satluj), proposed to be developed and maintained by our SPV, THPL;

Youngthangkhab Hydroelectric Project: a 261 MW hydroelectric power project in District Kinnaur on the

Spiti/Satluj river in the state of Himachal Pradesh proposed to be developed and maintained by our SPV, YPVL; and

Aparna Infraenergy Thermal Power Project, a 250 MW coal based thermal power project, in Mauza-

Kawthala, Taluka Chimur, District Chandrapur, Maharashtra, proposed to be developed and maintained by our SPV, AIIPL.

Our EPC Business Our Company has ventured into undertaking EPC business by way of project monitoring through sub-contracting route for its own projects awarded by NHAI and other state road development authorities. This route allows our Company to leverage its management expertise thereby achieving efficient margins and de-risking contractual hurdles. Currently, our Company is undertaking EPC works in for two of our Subsidiaries, VGRPL and SSRPL.

For the risks related to our aforesaid projects, please refer to section titled “Risk Factors” on page 49. On a consolidated basis, our total income for the Financial Year 2012-13 and the nine month period ending December 31, 2013 is ₹69,813.92 lakhs and ₹46,065.91 lakhs, respectively and our net profit / (loss) (being profits attributable to the Group shareholders) for the Financial Year 2012-13 and the nine month period ending December 31, 2013 is ₹1,472.63 lakhs and ₹ (5,644.39) lakhs, respectively. In accordance with the Unaudited Consolidated Interim Condensed Financial Statement as of and for the six months period ending June 30, 2014, our total income is ₹ 36,931.24 lakhs and our net profit / (loss) (being profits attributable to the Group shareholders) is ₹ (6,116.52) lakhs. RECENT DEVELOPMENTS Set out below are certain key developments that have taken place since the date of our last audited consolidated Financial Statements which was for a period of 9 months ending on December 31, 2013: Roads Sector Our SPV, YPHPL has entered into an agreement with NHAI on March 14, 2014, for the termination of

concession agreement dated July 30, 2012, for four laning of the Uttar Pradesh-Haryana border on the Yamunanagar-Saha-Barwala-Panchkula section of NH – 73, in the State of Haryana, as YPHPL was unable to commence construction activities at the project site on account of non availability of land and certain

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government approvals. For more details, please refer to “Risk Factors” on page 49. Our SPV, BBHPL has entered into an agreement with NHAI on March 28, 2014, for the termination of

concession agreement dated May 31, 2012, executed for the purpose of rehabilitation and upgradation of Birmitrapur – Barkote section of NH – 23, in the State of Orissa, as BBHPL was unable to commence construction activities at the project site on account of non availability of land and certain government approvals. For more details, please refer to “Risk Factors” on page 49.

Our SPV, PBHL has entered into a concession agreement with NHAI on February 02, 2012 and has

initiated discussions with NHAI for mutual termination of concession agreement executed for 4-laning of the Patna – Buxar stretch of NH-30 and 84, in the State of Bihar, as PBHL is unable to proceed with construction activities at the project site on account of non availability of land and certain government approvals. For more details, please refer to “Risk Factors” on page 51.

In relation to our SPV, PBHL, on August 30, 2014 NHAI encashed a sum of ₹1,129.11 lakhs, out of the

performance bank guarantee of ₹5,646 lakhs due to default of the due and faithful fulfilment and compliance with the terms and conditions contained in the concession agreement. We intend to contest the matter in an appropriate forum.

Our SPV, CBICL, operating the Cochin Bridge Project was obstructed from collecting toll at the Cochin

Bridge Project by the Greater Cochin Development Authority on April 27, 2014 by unilaterally sealing the toll booth. For details please refer to “Legal Proceedings” and “Risk Factors” on pages 212 and 65 respectively.

Tolling operations at the two toll booths of Vijayawada Gundugolanu Toll Road Project has commenced

with effect from September 1, 2014 after NHAI declared the appointed date as September 1, 2014.

Port Sector Our SPV, MTL has entered into a concession agreement with Mormugao Port Trust on January 18, 2013

for providing mechanized handling facilities for handling coal at berth no. 11 at Mormugao Port in the state of Goa. MTL and the Mormugao Port Trust were to satisfy all the conditions precedent by February 2014. However, due to a disagreement between the parties in relation to non-compliance of conditions precedent, Mormugao Port Trust has communicated that it is unilaterally terminating the concession agreement. Subsequently, MTL filed a suit for injunction and obtained a stay order on the termination of the concession agreement and the invocation of the bank guarantee of ₹ 200.00 lakhs. Further, despite the ad-interim stay order the bank guarantee has been invoked by Mormugao Port Trust. For more details, please refer to “Legal Proceedings” on page 214 and “Risk Factors” on page 50.

Power Sector In relation to our Youngthangkhab Hydroelectric Power Project, YPVL has initiated correspondence with

the GoHP for exiting from the Youngthangkhab Hydroelectric Power Project primarily due to inability of the GoHP in resolving the local agitations related to environmental issues because of which YPVL was forced to stop the geological studies. YPVL vide letter dated June 19, 2014 requested GoHP for mutual termination of the Youngthangkhab Hydroelectric Power Project and has also requested to re-imburse / refund an amount of ₹ 12,794.09 lakhs on account of losses (including the upfront premium, interest and expenses) incurred by YPVL. The GoHP is yet to respond to YPVL’s letter. For more details, please refer to “Risk Factors” on page 49.

OUR COMPETITIVE STRENGTHS We believe our principal strengths are as follows: Experience in Infrastructure Project Development We are an infrastructure projects development company undertaking projects at various stages in sectors such as roads, ports and power, which are the key drivers of the economy. We are one of the few Indian infrastructure companies with a presence across road, port and energy sectors. We presently derive our revenues from our road and port assets and are in the process of completing the construction of a power project. We will continue to

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focus on undertaking projects on a PPP basis. Our understanding of the infrastructure sector, specifically projects being undertaken under the PPP model, and in some cases experiences through the life cycle of each project, has enabled us to take decisions that are in the best interest of the Company. We have in AEL and REL developed substantial experience and expertise over the life cycle of the project, i.e. from project appraisal stage, bidding for the project, achieving Financial Closure, project management during construction phase and undertaking operations and maintenance of the project including major maintenance at five year intervals. Our early-mover advantage and continued focus in the infrastructure projects provide us with a platform to further develop our presence and diversify into other sectors in the infrastructure space. Our access to financing sources, potential partners and industry expertise enable us to identify and value new projects effectively, assess risks and compare evaluation results against our experience. We also provide O&M services for various projects, either directly or through the SPV itself, which helps us leverage the operating costs of such projects. Our experience has made us familiar with the risks associated with infrastructure projects in India, which has enabled us to negotiate agreements and execute our projects more effectively and efficiently. We regularly assess our projects and have, in the past, exited from projects that were proving to be or likely to be a drain on our resources. Project Portfolio Consisting of Both Assured and Market Driven Returns We have a good mix of assured and market driven returns, which we believe will help us prosper in the long run and offer us significant leverage in the infrastructure space. Our Rajahmundry Expressway Annuity Road Project, Andhra Expressway Annuity Road Project, Kosi Bridge Annuity Road Project and Gorakhpur Annuity Road Project are annuity road projects and have assured sources of revenue in the form of annuities payable by NHAI. Our Mumbai-Nashik Expressway Toll Project and Visakhapatnam Port Project are sources of market driven revenues. The toll charges on our road projects are subject to revision based on variation in the wholesale price index, as notified by the Government. For the nine month period ending December 31, 2013, our roads segment operated at a 47.23% – 21.81% mix of annuity revenue to toll revenue. Our projects under the Development Phase are also a prudent mix of assured and market driven revenue generating projects. Proven Track Record for Winning Bids and Efficient Execution of Projects We have a track record for winning projects and executing them successfully. Our access to financing sources, potential partners and industry expertise enable us to value new projects effectively, assess risks in a proper manner and benchmark our conclusions against our prior experience. We have also traditionally been successful in identifying and mitigating certain development and operation risks, which we believe is a source of competitive advantage for us. We have a track record in the successful development, execution and O&M of infrastructure projects. As of date, we have commissioned and have in operations 5 road projects and 1 port project. Our concession agreements, such as those entered into with REL, AEL, KBICL, GICL and PHPL, provide for bonus payments when the project is commissioned before the occurrence of the scheduled completion date of a project. We successfully commissioned Rajahmundry Expressway Annuity Road Project and Andhra Expressway Annuity Road Project 70 and 30 days, respectively, ahead of the scheduled completion date and have received bonus payments for the same. Our management team is highly experienced, with comprehensive expertise in the infrastructure sector. Many of our leaders have more than 15 years of experience in the infrastructure sector and have held senior positions in other infrastructure business, which, we believe, have given them with a holistic and interdisciplinary perspective on infrastructure business. Continuous Growth in our Bid Capacity and Pre Qualification Capability Our business and growth are significantly dependent on our ability to bid for and secure larger and more varied projects. Bidding for infrastructure projects is dependent on various criteria, including, bid capacity and pre qualification capability. Bid capacity represents the aggregate value of the contracts that can be awarded to us, and is computed based on pre defined formulae of agencies such as the NHAI, etc. Bid capacity also includes the highest possible value of a single project that can be awarded to us. In addition to meeting bid capacity requirements, we may also be required to pre qualify for the projects. This includes past experience in the execution of similar projects, technical ability and performance, reputation for quality, safety standards, financial strength and the price competitiveness of the bid. Hence, it is imperative to enhance our bid capacity

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and pre qualification capability. We have focused on increasing both these parameters and have continuously increased our bid capacity and the largest order that we can bid for. Revenue Generation through Operations and Maintenance Services (“O&M”) We have been providing O & M services for the Rajahmundry Expressway Annuity Road Project and Andhra Expressway Annuity Road Project since the commissioning of these projects in September 2004 and October 2004, respectively. The Company receives fixed payments for these services, which has become an assured source of revenue for us. The Company successfully completed the first ‘periodic maintenance activity’ for these projects in financial year 2010, which is undertaken every 5th, 10th and 15th years as per the concession agreement. Further, we have been undertaking the O&M, for Mumbai Nasik Expressway Road Project, Kosi Bridge Annuity Road Project and Gorakhpur Annuity Road Project since their respective CODs. Thus, we have gained significant experience and expertise in O&M and have added this service as one of the fixed source of revenue generation. Project Portfolio Spread Across Three Different Sectors and Geographies Our projects are spread across the roads, ports and power sectors. Our road sector projects are Rajahmundry Expressway Annuity Road Project, Andhra Expressway Annuity Road Project, Gorakhpur Annuity Road Project, Mumbai Nasik Expressway Toll Road Project, Patna Highways Annuity Road Project, Rajahmundry Godavari Toll Road Project, Vijayawada Gundugolanu Toll Road Project, Sidhi Singrauli Toll Road Project, Patna Buxar Toll Road Project and Kosi Bridge Annuity Road Project. Our port sector projects are Visakhapatnam Port Project and Mumbai Off-shore Container Terminal Project. Our power sector projects are Pravara Co-generation Power Project, Tidong Hydroelectric Power Project, Youngthangkhab Hydroelectric Power Project, Aparna Infraenergy Project and Rangit II Hydroelectric power project. Further, these projects are geographically dispersed across 7 states in India. We believe that such sectoral and geographic diversity enables us to achieve operational flexibility, as well as, mitigate the risks in operating in specific sectors and geographical locations. Ability to Mobilise Financial Resources We believe that with our experience in raising capital (by way of debt and/or equity) through efficient structures in the financial markets, we are suitably poised to take advantage of future opportunities in the infrastructure sector. For example, under our Patna Highway Annuity Road Project, in terms of the concession agreement, we have achieved Financial Closure, at a debt to equity ratio of 90:10. Also, we have achieved loan tenures of 18 years for the Rajahmundry Godavari Toll Road Project. Further, out of our 8 projects in the Development Phase, 7 have achieved Financial Closure. As infrastructure project development on PPP basis is a highly capital-intensive business activity, we believe that our long term experience and expertise in the infrastructure sector coupled with our ability to understand the cash flow requirements of executing and managing such projects enable us to financially engineer our projects better and mobilise financial resources more efficiently than our competitors in the industry. We Benefit from the Gammon Brand, Which We Believe is Known for Reliability, Efficiency and Risk Control. We are the infrastructure arm of the Gammon Group. The Gammon Group has been operating in India for over 90 years in the fields of construction and infrastructure. Due to the long-standing history of the Gammon Group, we believe that the Gammon brand enjoys strong brand recognition in the infrastructure sector. Further, successful infrastructure development is dependent upon 2 major types of expertise: (i) project development, which includes appraisal, bidding, financing and project management; and (ii) engineering, procurement and construction. As a developer, although we have expertise in project management and execution, we derive significant synergies from the Gammon Group. We intend to continue to build upon our experience by drawing on the strong engineering and design capabilities of GIL, including technological advancements. Our Association with GIL has strengthened our competitive position. While we have the advantage of access to the construction skills and expertise of GIL, our promoter, we are free to award construction contracts for our projects to other contractors on competitive basis. This has helped us in

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getting competitive price for our construction contracts from our promoter as well as other players in the construction industry. OUR STRATEGY Leverage India’s Demand for Infrastructure Projects and Deliver We believe that the prospects for the infrastructure industry in India look positive with the Planning Commission of India recognizing the continued infrastructure deficit of India. We intend to continue to focus on moving our projects through the development cycle as efficiently as possible so that they become operational and commence contributing to our revenue. In our roads business, we will continue to bid for selective and profitable projects with a mix of assured and market linked returns. In our power business, we will continue to look for opportunities in the renewable energy space, including hydro projects. The 12th Plan (covering 2012 to 2017) envisages investment of US$1 trillion in infrastructure sector, which is double the investment over the previous eleventh 5 year plan. In addition, almost half of this investment is expected by the Planning Commission to come through the private sector. As the Indian economy continues to grow, our Company expects that India’s energy consumption will grow as well. Our Group intends to position ourselves to benefit from the growth of the power sector in India that is expected to add 88,000 MW of generation capacity during the 12th Plan (2012-2017). We believe this provides tremendous business potential for established and emerging infrastructure developers, such as us. Focus on Liquidity Management The last few years have been challenging for the infrastructure sector due to the lack of liquidity attributed to macroeconomic factors. The nature of our industry requires early stage project finance at a high cost. As we move to make our projects operational, we take steps to refinance the early high cost debts with lower cost debts. We have, in the past, refinanced our existing debts, rescheduled our debt repayments and repaid debts to improve our liquidity management. We adopted a pragmatic approach to navigate through the turbulent times the Industry passed in the recent past by reducing our overhead expenses and optimally stretching our available resources. We continue to pursue our recoveries from our clients which have been pending and also continue to take steps to reduce costs, improve operational efficiencies and improve cash flows. Continue to Identify Diverse Sectors and Geographies We are actively focused on becoming a diversified infrastructure player, sector wise and geographically. We are currently analysing a number of new potential projects in the infrastructure sectors in which we currently operate as well as new sectors such as water, waste water and railways, which will enhance and diversify our revenue sources. We intend to continue to pursue the advantages associated with early entry in specific infrastructure sectors in order to achieve a dominant position within such sectors and to realise specific advantages of higher margins. Further, we believe that our infrastructure assets should be geographically dispersed to mitigate effectively against geographical risks. Accordingly, we intend to diversify into other sectoral assets spread over various locations across India. We may also in the future, explore business opportunities for developing projects outside India, mainly in developing economies. Explore O&M Opportunities to External Projects We have gained substantial experience in managing, operating and maintaining infrastructure projects. We intend to offer fee-based O&M services for infrastructure projects developed by others. We expect substantial capacity enhancement and completion of infrastructure projects in India in the next few years, which may provide us with opportunities to enhance the scope and size of our O&M services, especially in the road sector. Monetising of SPVs through Divestments Our senior management based on a detailed analysis of the trends in the infrastructure sector has adopted a strategy to focus on maintaining an optimal mix of assets across the development cycle with sales of assets or strategic stakes in assets to unlock value. Going forward, we may from time to time, consider monetising our investments in our SPVs, through divestments where required. Such divestment will provide us the financial strength to bid for other projects and improve our profits and cash flows. We plan to continue with this strategy through a constant review of our portfolio and assets for value creation.

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SUMMARY OF THE ISSUE The following is a general summary of the terms of the Issue. This summary should be read in conjunction with, and is qualified in its entirety by, the more detailed information appearing elsewhere in this Placement Document, including the sections entitled “Risk Factors”, “Use of Proceeds”, “Placement”, “Issue Procedure” and “Description of the Equity Shares” on pages 49, 86, 184, 174 and 195, respectively.

Issuer Gammon Infrastructure Projects Limited Face Value ₹ 2 per Equity Share Issue Size Issue of up to 20,41,74,286 Equity Shares, aggregating to ₹ 25,889.30 lakhs

A minimum of 10.00% of the Issue Size shall be available for Allocation to Mutual Funds only, and the remaining shall be available for Allocation to all QIBs, including Mutual Funds. If no Mutual Fund is agreeable to take up the minimum portion mentioned above, such minimum portion or part thereof may be Allotted to other eligible QIBs.

Date of Board Resolution

June 20, 2014

Date of Shareholders’ Resolution

July 15, 2014

Floor Price ₹ 13.3375 per Equity Share. In terms of the SEBI Regulations, the Issue Price cannot be lower than the Floor Price. The QIP Committee has on September 4, 2014 approved a discount of ₹ 0.6575 to the floor price in terms of Regulation 85 of SEBI Regulations.

Issue Price ₹ 12.68 per Equity Share

Eligible Investors QIBs as defined in regulation 2(1)(zd) of the SEBI Regulations and not excluded pursuant to Regulation 86 of the SEBI Regulations. See the sections entitled “Issue Procedure” and “Transfer Restrictions” on pages 174 and 191.

Equity Shares paid-up and outstanding immediately prior to the Issue

73,40,26,438 Equity Shares

Equity Shares paid-up and outstanding immediately after the Issue

93,82,00,724 Equity Shares

Listing Our Company has obtained in-principle approvals in terms of Clause 24(a) of the Equity Listing Agreements, for listing of the Equity Shares issued pursuant to the Issue from the Stock Exchanges. Our Company will make applications to each of the Stock Exchanges to obtain final listing and trading approvals for the Equity Shares after Allotment of the Equity Shares in the Issue.

Lock-up To provide comfort to the Investors that may participate in the Issue, the Promoter, during the period commencing on the date hereof and ending 60 days after the date of allotment of the Equity Shares under the Issue (the “Lock-up Period”), agrees not to, without the prior written permission of the Book Running Lead Managers, do the following:

(a) sell or transfer, any equity shares held by the Promoter or any securities convertible into or exercisable for any equity shares held by the Promoter or file any registration statement under the U.S. Securities Act of 1933, as amended, with respect to any of the foregoing (regardless of whether any of the transactions described in this clause (a) is to be settled by the delivery of the equity shares held by the Promoter or such other securities, in cash or otherwise); or

(b) sell or transfer, in whole or in part, directly or indirectly, any of the economic consequences associated with the ownership of any of the equity shares held by the Promoter or any securities convertible into or exercisable or exchangeable for any of the equity shares held by the Promoter; or

(c) deposit any of the equity shares held by the Promoter with any depositary in connection with a depositary receipt facility; or

Provided, however, that the foregoing restrictions shall not apply to any sale, transfer or disposition of any of the Promoter Shares by the undersigned with prior notice to the Book Running Lead Managers to the extent such sale, transfer or disposition is required by Indian law; and any bona fide

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pledge or non disposal undertaking of any of the Promoter Shares held by the undersigned as collateral for loans on normal commercial terms entered or to be entered into in the ordinary course of business of the undersigned, our Company and/or its Subsidiaries or transfer of any of the Promoter Shares to any third party pursuant to the invocation of any pledge in relation to the Promoter Shares.

As used in the lock-up undertaking, the term “Promoter Shares” shall mean the 52,80,00,000 Equity Shares owned by GIL together with any and all Equity Shares that may be acquired by GIL during the Lock-up Period. Notwithstanding anything provided above, the foregoing restrictions on transfer of Promoter Shares by GIL shall not apply to any inter group transfer made to any entities forming a part of the Promoter Group, subject to compliance with applicable laws and subject to observance by the transferee Promoter Group of the foregoing restrictions on transfer of Promoter Shares until the expiry of the Lock-up Period.

Transferability Restrictions

The Equity Shares being Allotted pursuant to this Issue shall not be sold for a period of one year from the date of Allotment, except on the floor of the Stock Exchanges. For further restrictions, see the section “Transfer Restrictions” on page 191.

Use of Proceeds The gross proceeds from the Issue will be approximately ₹ 25,889.30 lakhs. See the section “Use of Proceeds” on page 86 for further details.

Risk Factors See the section “Risk Factors” on page 49 for a discussion of risks you should consider before deciding whether to subscribe for the Equity Shares.

Pay-In Date Last date specified in the CAN sent to the QIBs for payment of application money. Closing The Allotment of the Equity Shares offered pursuant to the Issue is expected to be made on or about

September 8, 2014 (the “Closing Date”). Ranking The Equity Shares being issued pursuant to the Issue shall be subject to the provisions of the

Memorandum of Association and Articles of Association and shall rank pari passu in all respects with the existing Equity Shares, including rights in respect of dividends. The shareholders of our Company will be entitled to participate in dividends and other corporate benefits, if any, declared by our Company after the Closing Date, in compliance with the Companies Act, the Equity Listing Agreements and other applicable laws and regulations. Shareholders of our Company may attend and vote in shareholders’ meetings on the basis of one vote for every Equity Share held. See the section “Description of the Equity Shares” on page 195 for further details.

Security Codes for the Equity Shares

ISIN INE181G01025BSE Code 532959 NSE Code GAMMNINFRA

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SELECTED FINANCIAL INFORMATION The following selected Financial Information is derived from and should be read in conjunction with, the Financial Statements and notes thereto as at, and for the period nine months Financial Year ending on December 31, 2013 and twelve months Financial Years ended March 31, 2013 and 2012 prepared in accordance with Indian GAAP, each included elsewhere in this Placement Document. You should refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, on page 91, for further discussion and analysis of the Financial Statements.

The financial information included in this Placement Document does not reflect our Company’s results of operations, financial position and cash flows for the future and its past operating results are no guarantee of its future operating performance.

SUMMARY DATA OF CONSOLIDATED BALANCE SHEET AS AT MARCH 31, 2012, MARCH 31, 2013 AND DECEMBER 31, 2013

(₹ in lakhs) As at Particulars March 31, 2012 March 31, 2013 December 31, 2013 Equity and liabilities Shareholders’ funds Share capital 14,656.30 14,761.55 14,761.55 Reserves and surplus 59,842.47 56,509.93 52,329.18

Sub-total 74,498.77 71,271.49 67,090.73 Minority interest 12,197.73 18,019.58 15,772.53 Non-current liabilities Long-term borrowings 3,03,885.21 3,61,171.96 3,73,016.48 Deferred tax liabilities (net) 256.45 208.38 249.21 Other long-term liabilities 88.50 88.50 88.50 Long-term provisions 2,992.01 7,502.44 5,582.46

Sub-total 3,07,222.17 3,68,971.28 3,78,936.64 Current liabilities Short-term borrowings 19,362.00 7,878.12 7,798.12 Trade payables, current 1,123.39 2,423.80 1,974.52 Other current liabilities 62,400.13 54,268.82 71,580.86 Short-term provisions 1,291.70 2,433.02 7,583.62

Sub-total 84,177.23 67,003.76 88,937.13 TOTAL 4,78,095.90 5,25,266.11 5,50,737.03

Assets Non-current assets Fixed assets : Tangible assets (net) 12,371.12 12,029.12 11,867.18 Intangible assets (net) 1,85,663.51 2,43,774.74 2,32,284.99 Capital work in progress 635.70 1,068.56 1,271.44 Intangible assets under development 2,15,652.47 2,04,670.65 2,44,434.85 Goodwill on consolidation 4,863.85 4,529.96 5,336.50 Deferred tax asset (net) 3,253.83 3,406.03 Non-current investments 64.31 91.03 79.25 Long-term loans and advances 22,981.14 23,077.19 21,183.69 Non-current trade receivables - 5.59 1,630.67 Other non-current assets 138.67 1,532.72 1,202.44

Sub-total 4,42,370.77 4,94,033.38 5,22,697.04 Current assets Current investments - 271.84 2,364.78 Inventories 350.71 631.24 1,153.87 Trade receivables 3,355.33 3,784.49 1,797.23 Cash and cash equivalents 25,119.56 6,924.96 9,503.87

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As at Particulars March 31, 2012 March 31, 2013 December 31, 2013 Short-term loans and advances 1,508.71 3,354.93 5,567.13 Other current assets 5,390.80 16,265.26 7,653.12

Sub-total 35,725.12 31,232.72 28,039.99 TOTAL 4,78,095.90 5,25,266.11 5,50,737.03

SUMMARY DATA OF CONSOLIDATED STATEMENT OF PROFIT & LOSS FOR THE YEAR / PERIOD ENDED MARCH 31, 2012, MARCH 31, 2013 AND DECEMBER 31, 2013

(₹ in lakhs) Particulars

March 31, 2012 March 31, 2013 December 31, 2013 Amount Amount Amount

Income

Revenue from operations:

Revenue from projects 39,917.10 66,219.35 44,132.37

Other operating revenues 2,376.75 2,818.32 1,285.43

Other income 643.68 776.25 648.11

Total income 42,937.53 69,813.92 46,065.91

Expenses

Project expenses 13,743.92 16,619.46 13,100.15

Employee benefits expenses 2,567.56 2,892.54 2,435.30

Other expenses 3,378.26 2,789.79 2,145.87

Exceptional items 970.48 - -

Total expenses 20,660.21 22,301.79 17,681.32

Earnings before interest, taxes, depreciation and amortisation (EBITDA)

22,277.32 47,512.13 28,384.59

Finance costs 15,565.94 29,683.38 21,902.87

Depreciation/amortisation 7,789.92 16,085.22 11,956.02

Share of (profit)/loss from investment in associates

(26.62) (3.72) 11.78

Profit/(Loss) before tax (1,051.92) 1,747.26 (5,486.08)

Less: Tax expenses

Current tax 1,333.89 3,032.97 338.14

Deferred tax (credit)/charge (9.94) (3,301.90) (111.37)

MAT credit entitlement (171.40) (486.96) (229.25)

Short / (excess) provision for earlier years

- 16.79 97.32

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Particulars

March 31, 2012 March 31, 2013 December 31, 2013 Amount Amount Amount

Net tax expense 1,152.56 (739.11) 94.85

Profit/(Loss) after tax (2,204.47) 2,486.37 (5,580.93)

Less : Profit after tax attributable to minority interest

337.34 1,013.73 63.46

Profit / (Loss) attributable to group shareholders

(2,541.81) 1,472.63 (5,644.39)

Earnings per share (‘EPS’) (in Rupees)

Basic (0.35) 0.20 (0.77)

Diluted (0.35) 0.20 (0.77)

Nominal value of equity share 2.00 2.00 2.00

SUMMARY DATA OF CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR / PERIOD ENDED MARCH 31, 2012, MARCH 31, 2013 AND DECEMBER 31, 2013

(₹ in lakhs)

March 31, 2012 March 31, 2013 December 31, 2013

CASH FLOW FROM OPERATING ACTIVITIES :

Profit /(Loss) before tax (1,051.92) 1,747.26 (5,486.08)

Adjustments for :

Employees stock options (0.58) (35.19) 24.57

Cash alternative settlement for ESOP scheme 35.37 42.85 (17.41)

Depreciation and amortisation 7,789.92 16,085.22 11,956.02

Gratuity and leave encashment 71.42 85.15 91.26

Dividend Income (238.70) - -

Interest income - - (332.63)

Interest expense - - 21,902.87

Interest (net) 15,313.86 29,216.68 -

(Profit)/Loss on sale of investments (78.27) (250.13) (217.67)

Share of (profit) / loss from investment in associates

(26.62) (3.72) 11.78

Loss on sale of assets 33.76 58.61 25.48

Assets written off 101.05 99.15 32.72

Provision for periodic maintenance expenses 2,821.03 4,418.70 3,753.13

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March 31, 2012 March 31, 2013 December 31, 2013

Provision for loans and advances/other assets 154.58 4.58 200.08

Provision for diminution in value of investment 219.87 (23.00) -

Exceptional item 970.48 - -

Preliminary and share issue expenses written off 221.57 0.30 -

Operating profit before working capital changes

26,336.84 51,446.47 31,944.11

Adjustments for :

Trade and other receivables (1,646.73) (11,715.14) 9,376.96

Inventories 426.34 (280.53) (522.62)

Trade payables and working capital finance 2,494.16 (319.16) 1,903.77

Cash generated from the operations 27,610.61 39,131.65 42,702.22

Cash Compensation paid - (220.50) -

Direct taxes paid (1,717.04) (2,813.65) (1,902.93)

Net cash from operating activities (A)

25,893.57 36,097.50 40,799.29

CASH FLOW FROM INVESTMENT ACTIVITIES :

Capital purchases after adjusting capital creditors (98,227.75) (59,857.47) (35,312.30)

Proceeds on sale of fixed assets 1.86 153.43 122.82

Purchase of investments :

- Mutual funds (52,399.27) (29,793.29) (50,238.50)

Sale of investments :

- Mutual funds 52,637.97 29,771.57 48,761.38

- Market investments 378.27 - -

Intercorporate deposits given:

- Granted during the year / period (251.00) (4,934.91) 220.78

- Refund / repayment received of intercorporate deposit

150.00 4,489.27 (2,304.62)

Payment towards debt service reserve - - (735.00)

Advances from/(to) joint venture companies 770.45 (625.08) -

Advance paid for acquisition of stake in a subsidiary

- (1,347.94) -

Amount received from/(paid) to minority shareholders

(3,700.30) 490.00 (1,297.20)

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March 31, 2012 March 31, 2013 December 31, 2013

Disposal /(acquisition) of stake in a subsidiary/joint venture companies

8.65 425.79 (384.13)

Interest received 335.50 372.07 246.47

Net cash used in investment activities (B)

(1,00,295.62) (60,856.56) (40,920.30)

CASH FLOW FROM FINANCING ACTIVITIES :

Proceeds from equity share capital 3.00 - -

Capital grant received 8,769.90 1,825.00 -

Proceeds from borrowings 1,75,250.57 1,21,705.28 50,957.19

Repayment of loans (87,954.81) (82,680.14) (28,143.68)

Disposal/(Acquisition) of equity stake to / (from) minority share holder

3,492.74 (1,716.37) -

Interest paid (14,734.78) (30,647.16) (20,471.64)

Dividend paid (including Dividend distribution tax)

- - (376.96)

Preliminary and share issue expenses (221.57) (14.37) -

Net cash from financing activities (C )

84,605.04 8,472.23 1,964.92

Net increase/(decrease) in cash and cash equivalents (A+B+C)

10,202.98 (16,286.84) 1,843.91

Cash and cash equivalents, end of the period / year

25,119.56 6,924.96 8,768.87

Cash and cash equivalents, beginning of the period / year

14,916.59 23,211.80 6,924.96

Net increase/(decrease) in cash and cash equivalents

10,202.98 (16,286.84) 1,843.91

Summary of reservations or qualification or adverse remarks or EOMs or CARO observations in the auditors’ report in the last five Financial Years immediately preceeding the year of filing the PPD Year 2009-10 There are no reservations or qualifications or adverse remarks in the auditors’ report for the financial year 2009-10. Details of the EOMs are set out below: EOM: Without qualifying their opinion, the Joint Auditors have drawn attention to Note B 4(b)(i) of Schedule 19 of the consolidated financial statement for the Financial Year ended March 31, 2010 in connection with the early completion bonus accrued by two subsidiary company in earlier years and included in sundry debtors at March 31, 2010. The outcome of the matter could not be determined then and hence no provision for any liability was

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made in the financial statement for the year March 31, 2010. Management’s Response: ₹ 1,539.69 lakhs of early completion bonus receivable from National Highways Authority of India (‘NHAI’) was accrued in earlier years by two of our subsidiaries AEL and REL which had been disputed by the NHAI. AEL and REL had initiated arbitration proceedings for recovery of the bonus.

However after the due legal process, the case went in the favour of the subsidiaries and they subsequently received the early completion bonus.

Year 2010-11 There were no reservations or qualifications or adverse remarks or EOMs of Joint Auditors in their report. Year 2011-12 There were no reservations or qualifications or adverse remarks or EOMs of Joint Auditors in their report. Year 2012-13 There were no reservations or qualifications or adverse remarks or EOMs of Joint Auditors in their report. Nine months period ending on December 31, 2013 There are no reservations or qualifications or adverse remarks in the auditors’ report for the nine month period ending December 31, 2013. Details of the EOMs are set out below: EOM: Without qualifying their opinion, the Joint Auditors have drawn attention to Note 35 of the consolidated Financial Statements for the nine months period ending on December 31, 2013, in relation to notice served by the Company’s subsidiaries for closure of two projects. The Company’s exposure including equity contributions and advances is amounting to ₹ 4,068.81 lakhs (excluding guarantee of ₹ 3,891.00 lakhs). Pending conclusion between the parties, no adjustments have been made in the consolidated Financial Statements for the nine months period ending on December 31, 2013. Management’s Response Two wholly owned subsidiaries of the Group had initiated correspondence with NHAI for closure of its projects viz. Birmitrapur to Barkote of NH-23 being undertaken by BBHPL and Yamunanagar to Panchkula of NH-73 being undertaken by YPHPL on mutually acceptable terms on account of NHAI’s inability to fulfill conditions precedent due to non-availability of right of way to the site and non-receipt of environment and forest clearances. The closure was subject to confirmation by NHAI and involved a process of discussions and settlement between the respective subsidiaries and NHAI to determine the terms of closure or continuance of the project, pending which, no adjustments had been made in the consolidated Financial Statements.

However during the quarter ended March 31, 2014 both the projects were terminated and expenditure incurred on them was written off in the quarter ended March 31, 2014. EOM: Without qualifying their opinion, the Joint Auditors have drawn attention to the net loss after tax of ₹ 5,644.39 lakhs during the nine months period ended December 31, 2013 and, as of that date, the Group’s current liabilities exceeded its current assets by ₹ 60,897.13 lakhs. The management’s plan to address the uncertainty as to the timing and realization of cash flows are discussed in Note 34 to the consolidated Financial Statements for the nine months period ended on December 31, 2013.

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Management’s Response As on December 31, 2013, current liabilities exceed current assets by ₹ 60,897.13 lakhs. The Group is taking various steps to meet its commitments, both, short term and long term in nature. The Group is actively pursuing various payments from the client including bonuses, grants, and claims for its projects. Subsequent to the balance sheet date, in one such case, it has received such bonus payment amounting to ₹ 6,734.44 lakhs. Further the Group intends to monetize some of its mature assets, as well as securitize some of its future receivables. The Group is in active discussions with various lenders for raising additional long term debts. The Group will also generate contracting income and developer fees out of the new projects that it has been awarded. Based on detailed evaluation of the current situation, plans formulated and active discussions underway with various stakeholders, management is confident that the going concern assumption and the carrying values of the assets and liabilities in these consolidated Financial Statements are appropriate. EOM with respect to standalone Financial Statements Without qualifying their opinion, the Joint Auditors have drawn attention to the net loss after tax of ₹ 1,396.66 lakhs during the nine months period ended December 31, 2013 and, as of that date, the Company’s current liabilities exceeded its current assets by ₹ 45,709.47 lakhs. The management’s plan to address the uncertainty as to the timing and realization of cash flows are discussed in Note 36 to the standalone Financial Statements for the nine months period ended on December 31, 2013. Management’s Response The Company is taking various steps to meet its commitments, both, short term and long term in nature. The Company intends to monetize some of its mature assets, as well as securitize some of its future receivables. The Company is in active discussions with various lenders for raising additional long term debts. The Company will also generate contracting income and developer fees out of the new projects that it has been awarded. Based on detailed evaluation of the current situation, plans formulated and active discussions underway with various stakeholders, management is confident that the going concern assumption and the carrying values of the assets and liabilities in these financial statements are appropriate. EOM with respect to standalone Financial Statements Without qualifying their opinion, the Joint Auditors have drawn attention to Note 35 to the standalone Financial Statements, in relation to notice served by the Company’s subsidiaries for closure of two projects. The Company’s exposure including Equity contributions and advances is amounting to ₹ 4,060.52 lakhs (excluding guarantees of ₹ 3,891.00 lakhs). Pending conclusion between the parties, no adjustments have been made in the standalone Financial Statements.

Management’s Response

Two wholly owned subsidiaries of the Company had initiated correspondence with NHAI for closure of its projects viz. Birmitrapur to Barkote of NH-23 being undertaken by BBHPL and Yamunanagar to Panchkula of NH-73 being undertaken by YPHPL on mutually acceptable terms on account of NHAI’s inability to fulfill conditions precedent due to non-availability of right of way to the site and non-receipt of environment and forest clearances. The closure was subject to confirmation by NHAI and involved a process of discussions and settlement between the respective subsidiaries and NHAI to determine the terms of closure or continuance of the project, pending which, no adjustments had been made in the standalone Financial Statements.

However during the quarter ended March 31, 2014 both the projects were terminated and Companies exposure is adequately provided in the quarter ended March 31, 2014. In the Joint Auditors’ review report on Unaudited Consolidated Interim Condensed Financial Statements for the six months ended June 30, 2014 The Joint Auditors have made the following qualifications and EOM in the review report on Unaudited Consolidated Interim Condensed Financial Statements for the six months period ended June 30, 2014:

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Qualification As detailed in Note 6(f) to the Unaudited Consolidated Interim Condensed Financial Statements, one of the subsidiaries of the Company had issued a notice of intention to terminate the concession agreement with NHAI on mutual terms. The Company and NHAI are evaluating various alternatives for the project. The Group’s exposure to this project includes project expenses of ₹ 6,935.61 lakhs and guarantees of ₹ 5,646.00 lakhs. As outcome of the matter is uncertain, Joint Auditors are unable to determine the recoverability of said amount and consequential impact on the Unaudited Consolidated Interim Condensed Financial Statements. Management’s Response One of our Subsidiaries, had initiated correspondence with NHAI towards closure of its project on mutually acceptable terms primarily due to non-availability of right of way to the site and forest clearances. In a recent meeting, NHAI has requested for evaluating various alternatives for the project. Contingent upon outcome of the discussions on compensation within the scope of concession agreement with NHAI and responses of the management, there might be review/reworking on the project parameters. The Group's exposure to this project includes project expenses of ₹ 6,935.61 lakhs and guarantees of ₹ 5,646.00 lakhs Pending conclusion of the matter, no liability therefore has been provided in the accounts towards closure of the project. EOM The Group has incurred a consolidated net loss after tax of ₹ 6,115.78 lakhs for the six month period ended June 30, 2014 and as of that date the Group’s current liabilities exceeded current assets by ₹ 66,975.83 lakhs. These conditions, along with other matters as set forth in Note 6(e) of the Unaudited Consolidated Interim Condensed Financial Statements, indicate the existence of an uncertainty as to timing and realisation of cash flow. Management’s Response The Group is taking various steps to meet its commitments, both, short term and long term in nature. The Group intends to monetise some of its mature assets, securitise some of its future receivables and raise funds through equity offering through the proposed Qualified Institutions Placement. Based on detailed evaluation of the current situation, plans formulated and active discussions underway with various stakeholders, management is confident that the going concern assumption and the carrying values of the assets and liabilities in the Unaudited Consolidated Interim Condensed Financial Statements. EOM The Joint Auditors invite attention to Note 6(d) and Note 6(g) of the Unaudited Consolidated Interim Condensed Financial Statements, regarding unilateral termination and closure of concessions for two projects, which are subject to pending litigations/arbitrations at various forums which may impact the carrying values of investments made in the projects. The Group’s exposure on these projects includes unamortised project cost and trade receivables of ₹ 3,187.03 lakhs and corporate guarantees and bid securities of ₹ 1,212.50 lakhs. Pending conclusion on these legal matters, no adjustments have been made in the Unaudited Consolidated Interim Condensed Financial Statements. Management’s Response In relation to Note 6 (d), note that during the period, the MPT has unilaterally sought to terminate the concession agreement for the project with one of our Subsidiary, citing non-compliance with certain terms of the concession agreement. MPT also encashed the bid security bank guarantee for ₹ 200.00 lakhs despite the stay order issued by the District Court, Goa. The Court has also passed stay order from carrying into effect the termination of the concession agreement. Our Subsidiary has taken further action in the matter including contempt petition. The Group’s exposure towards the project is ₹ 557.29 lakhs. Pending the outcome of the legal proceedings, no adjustments have been made to the Unaudited Consolidated Interim Condensed Financial Statements. The management believes that it has a strong case in this matter. In relation to Note 6(g), please note that during the period, the Greater Cochin Development Authority has sought to end/obstruct the toll collection by a subsidiary by unilaterally sealing the toll booth. Our Subsidiary believes it has the right to collect toll at the bridge till April 27, 2020. Further necessary legal recourse is being initiated. The Group’s exposure includes trade receivables of ₹ 1,787.13 lakhs, unamortised project costs of ₹

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842.62 lakhs and corporate guarantee of ₹ 1,012.50 lakhs. Pending outcome of the legal proceeding, no adjustments have been made in the Unaudited Consolidated Interim Condensed Financial Statements. The management believes that it has a strong case in this matter. EOM The Joint Auditors invite attention to Note 6(h) of the Unaudited Consolidated Interim Condensed Financial Statements, in relation to intention to exit one of the hydro power projects at Himachal Pradesh and seeking a claim of an amount against the amount spent on the project. The Company’s subsidiary has cited reasons for non-continuance on account of reasons beyond its control. The subsidiary is negotiating with its client for an amicable settlement on beneficial terms. The Group’s exposure on this project includes project expenses and unbilled receivables of ₹ 6,722.66 lakhs. Pending conclusion between the parties, no adjustments have been made in the Unaudited Consolidated Interim Condensed Financial Statements. Management Response During the period, one of our Subsidiaries which has a license to develop a hydro power project in Himachal Pradesh has initiated correspondence with the State Government for exiting from the project primarily due to inability of the state government in resolving the local agitations related to environmental issues because of which our Subsidiary was forced to stop its geological studies at the project site. The subsidiary has paid an upfront premium of ₹ 5,285.25 lakhs to the State Government and the Group’s exposure towards the project excluding the upfront premium is ₹ 1,437.41 lakhs. The subsidiary has lodged a claim against the amounts spent on the project till date. The management believes that it has a strong case in this matter. CARO Observations The table below sets out the CARO observations on the standalone financial statements of our Company:

Period

Summary of Joint Auditors' remark Manangement's response

Financial Year ended March 31, 2010

The Company is generally regular in depositing Provident Fund, Income tax and service tax dues with the appropriate authorities though there has been a slight delay in a few cases.

There are very few cases of delays and these are regularized immediately once came to notice.

Financial Year ended March 31, 2011

The Company is generally regular in depositing with the appropriate authorities undisputed Statutory dues including Provident Fund, Employees State insurance, Income tax, Sales Tax, Wealth Tax, Service tax and other material statutory dues applicable to it though there has been a slight delay in a few cases.

There are very few cases of delays and these are regularized immediately once came to notice.

Financial Year ended March 31, 2011

According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that funds amounting to ₹5,746.48 lakhs raised on short term basis in the form of unsecured loans have been used for long-term investments.

Short term funds have been used for meeting equity commitments only as an interim measure pending raising of long term resources by way of long term loans, sale of equity stake in one or more of the projects and right issue of shares to shareholders.

Financial Year ended March 31, 2012

According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that funds amounting to ₹ 17,891.71lakhs raised on short term basis in the form of unsecured loans have been used for long-term investments.

Short term funds have been used for long term investments, the Board states that short term funds have been used for meeting equity commitments in the SPVs in line with the progress of the concerned projects as laid down in the concerned concession agreements and term loan agreements and is only an interim measure pending raising of long term resources by way of long term loans,

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Period

Summary of Joint Auditors' remark Manangement's response

sale of equity stake in one or more of the projects and the proposed right issue of shares for which final observations of SEBI was received recently.

Financial Year ended March 31, 2013

According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that funds amounting to ₹ 20,299.99 lakhs raised on short term basis in the form of unsecured loans and other current liabilities have been used for long-term investments.

This was purely an interim measure as the Company is actively pursuing measures to raise long term resources by way of securitization of cash flows of some of the SPVs and sale, part sale of some of the completedprojects.

Financial Year ended December 31, 2013

According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that funds amounting to ₹ 24,827.22 lakhs raised on short term basis in the form of unsecured loans and other current liabilities have been used for long-term investments.

The Company proposes to monetize some of its mature assets as well as securitize some of its future receivables and is in activediscussions with various lenders for long term debts. The Company will also generate income from internal sources by way of developer fees, contracting income and operation & maintenance income. These funds will be used for achieving an optimalbalance between short term funds and long term funds in the business of the Company.

Financial Year ended December 31, 2013

The Company has no accumulated losses at the end of the financial period and it has incurred cash losses in the current period, however ithas not incurred any cash losses in immediately preceding financial year.

Please refer to the above response

Changes in the accounting policies for consolidated Financial Statements

Changes in accounting policies during last three years and their effect on the profits and reserves of the Company

Sr. No Year Change in Accounting Policy Impact

1. Financial Year ending March 31, 2012

Until March 31, 2011, expenditure incurred by the SPVs of the Group on periodic maintenance were capitalised on completion of the said activity and amortised over the earlier of the period over which the next periodic maintenance was due or the period until the end of the concession.

With effect from March 31, 2012, periodic maintenance costs including resurfacing expenditure required to be undertaken by the SPVs as per the contract are recognised as a provision on a systematic basis over the period for which such obligations are to be carried out (refer Note 31 of the consolidated Financial Statement for Financial Year ended March 31, 2012).

Increase in expenditure on account of decapitalising of periodic maintenance expenditure already capitalised ₹ 7,454.05 lakhs

2. Financial Year ending March 31, 2012

Developer fees incurred by the Group are considered as exchanged with the grantor against toll collection / annuity rights from the contracts signed with the grantor and the revenue is considered as realised by the Group and not eliminated on consolidation under AS-21 consolidated Financial Statements (refer Note 31 of the Financial Statement for FY ending on March 31, 2012).

Increase in Income from developer fees by ₹ 6,502.59 lakhs

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Sr. No Year Change in Accounting Policy Impact

3. Financial Year ending March 31, 2012

The Group has changed the method of valuation of inventory from First in First Out (‘FIFO’) to the weighted average method of valuing the inventory.

Profit is lower by ₹ 0.05 lakh

4. Financial Year ending March 31, 2013

The amortisation of intangible assets arising out of service concession agreements was based on units of usage method i.e. on the number of vehicles expected to use the project facility over the concession period as estimated by the management. During the FY 2013, based on notification dated April 17, 2012 issued by the Ministry of Corporate Affairs, the Company has changed the method of amortisation of intangible assets arising out of service concession agreement prospectively. Effective April 1, 2012 the amortisation is in proportion to the revenue earned for the period to the total estimated toll and annuity revenue i.e. expected to be collected over the balance concession period.

Decrease in amortization expenditure by ₹ 185.09 lakh

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RISK FACTORS Prospective investors should carefully consider the risk factors described below together with all other information contained in this Placement Document before making any investment decision relating to the Equity Shares. These risks and uncertainties are not the only issues that we face. These risks and uncertainties and additional risks and uncertainties not presently known to us or that we currently believe to be immaterial may have an adverse effect on our business, results of operations, cash-flows, financial condition or prospects and might affect and cause the market price of the Equity Shares to fall significantly and you to lose all or part of your investment in the Equity Shares. Prospective investors should pay particular attention to the fact that our Company is incorporated under the laws of India and that we are subject to a legal and regulatory environment that may differ in certain respects from other countries. The project cost, the overruns and means to finance the overruns (as set out) in this Placement Document are based on our current business plan and on internal management estimates and have not been appraised by any bank or financial institution. In view of the nature of the industry in which we operate, we may have to revise our business plan from time to time and consequently the capital requirements may also change. Our historical capital expenditure may not be reflective of its future capital expenditure plans.

This Placement Document also contains forward-looking statements that involve risks and uncertainties. The Company’s results could differ materially from such forward-looking statements as a result of certain factors including the considerations described below and elsewhere in this Placement Document.

To obtain a complete understanding of our business, you should read this section in conjunction with the section titled “Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” on pages 127 and 91, respectively.

Risks associated with our Business

1. We have in the past not been able to successfully complete the development of few of our projects; where we have been the successful bidders due to which the costs incurred in relation to such projects may not be recoverable by us.

We have not been able to successfully complete some of our projects on time for which we have won the bids. Some of the reasons for such projects not being completed include among other the inability of , our clients to provide the required right of way over the land, approval, clearances etc, which is one of the conditions precedent for the development of such projects. We are currently in the Development Phase for some of our projects and Pre-Development Phase for some of our power projects. We will continue to face risks associated with implementation which could be due to reasons including those beyond our control which can include among others non availability of environmental clearances, acquisition of land by the government, delays from the client or partners with whom we have entered into contractual arrangements.

Birmitrapur Barkote Highway Private Limited and Yamunanagar Panchkula Highway Private Limited have terminated the contracts with NHAI on mutually acceptable terms primarily due to non-availability of Right of Way to the site and Environment and Forest clearances even after achieving the Financial Closure and the corresponding expenditure incurred has been written off. We cannot assure that such non-satisfaction of the conditions precedent shall not take place in the future in any of our projects that we may bid and win.

For some of our projects such as Patna Buxar Road Project and Youngthangkhab Hydroelectric Power Project, we are in discussions with the client and have communicated our intention to exit the project. We have incurred certain costs in relation to these projects which may or may not be recoverable by us, upon the completion of such termination. We cannot assure that such termination shall happen in the manner as anticipated by us or shall happen at all. In the event that such termination does not take place in the manner as anticipated by us, we may also be required to initiate legal proceedings.

In relation to our Tidong Hydroelectric Power Project, our partner in the project has indicated that it proposes to transfer the equity shares held by it to GIL. The Directorate of Energy, Government of Himachal Pradesh had asked for the rationale for such transfer, which has been responded to. In the event that the approval for the transfer of such shares is not granted, we may not be able to continue with this project. We cannot assure you that such approval for the transfer of its shareholding shall be obtained. In the event that such approval shall not come or we or our Promoter are not in a position to acquire such shares held by them, this may materially affect the project and we may also lose the right to develop the same.

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For instance, our Mormugao Port Project, a termination notice has been issued by the client and our bank guarantee of ₹ 200 lakhs has been invoked. In this regard, we are involved in certain litigation proceedings. While, we continue to incur costs towards such projects on the assumption that such projects will be operational, we cannot assure you that there may be no such unforeseen risks which may affect our Business. We may not be in a position to successfully defend such action taken to terminate this project or be able to win this project back. See “Legal Proceedings”. In relation to our Patna Buxar Toll Road Project, on August 30, 2014, NHAI encashed a sum of ₹1,129.11 lakhs, out of the performance bank guarantee of ₹5,646 lakhs due to default of the due and faithful fulfilment and compliance with the terms and conditions contained in the concession agreement.

Any termination in the future of any of our projects prior to its commercial operation date may also have a material adverse effect on our business, cash-flows and our ability to be able to bid and be qualified for future road projects either at the State Government level or with NHAI.

2. Delays in the completion of our Development Phase and Pre-development Phase projects could have adverse effects on our business prospects and results of operations.

Typically, our projects are subject to specific completion schedule requirements. We also provide performance guarantees to our clients which require us to complete projects within a specified time frame. Failure to adhere to contractually agreed timelines for reasons other than for force majeure events and counter-party defaults could lead to forfeiture of security deposits, result in us or our SPVs being required to pay damages or our performance guarantees being invoked.

We may face further delays in completion of some of our projects which are under Development Phase and Pre-development Phase. The scheduled completion targets for our projects, the cost overruns in some cases; are estimates of the management and are subject to delays and escalations as a result of, among other things, unforeseen engineering problems, force majeure events, unavailability of financing, unavailability of land, unanticipated cost increases or changes in scope and inability in obtaining certain property rights, or government approvals or non compliance by our clients with the terms of the contractual arrangements. In the past some of our projects under the Operations Phase during implementation phase had also faced delays. For instance, our projects Patna Highway Annuity Road Project which was supposed to commence commercial operations in August 2014 and Pravara Co-generation Power Project which is supposed to commence commercial operations in September 2014 may futher get delayed.

In cases where there have been delays, there can be no assurance that our projects will be completed in the estimated time frame. We cannot assure that all potential liabilities that may arise from delays will be covered or that the damages, if any, that may be claimed from third parties for such delay, shall be adequate to cover any loss of profits resulting from such delays. Further, any delay in completing construction contracts means that there may be an increase in the total cost of a construction contract which could exceed the original estimate or further cost escalation. Further, the SPVs’ lenders may impose additional restrictive covenants or other less favourable terms where existing financing arrangements have to be rescheduled or restructured. Delays may also result in cost overruns, lower or no returns on capital, erosion of capital and reduced revenue, as well as failure to meet scheduled debt service payments in addition to the project being terminated. Our inability to fund the project in the future may result in our failure or inability to achieve COD. Such delays and cost overruns will adversely affect our business, cash-flows and results of operations.

3. Our Promoter has recently undergone a corporate debt restructuring.

Our Promoter is currently subject to and operating under the restrictions prescribed pursuant to the corporate debt restructuring mechanism (“CDR”) approved by its lenders. The lenders monitoring committee (the ‘‘Monitoring Committee’’) which was constituted under the master restructuring agreement dated September 24, 2013 (“MRA”) shall monitor the implementation of the approved CDR package and procedures as laid down in the MRA. GIL shall also have the right to prepay the restructured loan amounts in part or in full with the prior approval of the Corporate Debt Restructuring Empowered Group (“CDR EG”) and the monitoring committee. In the event that GIL is required to raise funds in the future, in any manner including by way of private equity, external commercial borrowing venture capital or any other source, it shall be utilized for the prepayment of the restructured loan facilities.

Any capital or debt raising apart in the manner as set out in the approved CDR package shall have to be undertaken with the prior approval of the CDR EG and shall be utilised for the prepayment of the

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secured debt after approval of the CDR lenders/CDR EG. The CDR lenders have the right to convert all or any portion of the amounts due and unpaid under the facilities which have been restructured pursuant to the CDR., together with accumulated interest into CDR shares at a price in accordance with the SEBI ICDR Regulations. The CDR lenders who have provided a working capital term loan and funded interest term loan shall have an unqualified right to convert all or any portion of the outstanding amounts into CDR shares without an event of default. GIL should procure from the promoters an amount aggregating to ₹ 1,000.00 lakhs by way of unsecured and subordinated debt/equity/preference capital or any other capital (convertible into shares). In the event that any of the lenders convert the outstanding amounts into the equity shares of our Promoters, it shall amount to a substantial dilution of the shareholding of the promoters of GIL. This change in control of GIL may also result in change in control of our Company. GIL will not allow any of its subsidiaries (excluding GIPL and its subsidiaries) to extend short, medium or long term debt, make any advances to, or extend any corporate guarantee (including guarantee to secure the debt undertaken by its subsidiaries(excluding GIPL and its subsidiaries)/(joint venture companies/affiliates of GIL). GIL shall not wind up or dissolve its affairs due to any reason or change its shareholding patterns or issue any equity shares or other instruments convertible into equity shares or amend or modify the memorandum and articles of association without prior approval of the Monitoring Committee. GIL shall not enter into any transaction with any of its group/associate companies or promoter except in the ordinary course of business.

Additionally, in light of GIL currently undergoing a CDR it may not be in a position to extend any support to our projects.

4. We have in the past not been and continue to be, in relation to certain debt facilities, non compliant with certain financial and other covenants contained in our respective debt facilities which have resulted and potentially could result in an event of default and cross-defaults under other instruments, thereby accelerating our obligations under our debt facilities.

We enter into loan agreements, with various lenders for the financing of our projects and other purposes, which require us to comply with certain financial as well as non-financial covenants during the currency of the respective loans. In respect of most of these loan agreements, in case of an event of default, the lenders have the right to, inter alia, declare all amounts as outstanding with respect to that loan immediately due and payable (subject to the expiry of any applicable cure periods), exercise their rights pursuant to cross-default and cross-acceleration provisions under such loan agreements or instruments and enforce their security created under the loan agreements.

Any acceleration, cross acceleration, enforcement of security, trigger of a cross-default or declaration of a cross-default under the financing agreements entered into by our Company or any of our Subsidiaries or Joint Ventures may have a material adverse effect on our business, cash-flows, prospects and financial condition. As of June 30, 2014 our borrowings (aggregate of long-term borrowings, short-term borrowings and current maturities of long-term borrowings) was ₹ 4,22,758.43 lakhs.

There have been, in the past, breaches of covenants under the loan agreements of our Subsidiaries including breaches of financial covenants and certain other projected revenue requirements under such financing agreements, which may have resulted in a cross-default.

For instance:

Pursuant to the non-receipt of the annuity payments, our Subsidiary, GICL has defaulted in the repayment of the interest portion of the debt availed from IDFC Limited for the month of April, May, June and July, 2014. Interest for the month of April 2014 was paid on May 26, 2014. The interest overdues for the month of May 2014, June 2014 and July 2014 were paid on July 28, 2014 after GICL received the annuity payments on July 28, 2014 after a delay of nearly 4 months. GICL failed to timely pay an amount of ₹ 1,700.00 lakhs towards principal repayment and an amount of ₹ 1,355.00 lakhs towards interest repayment. There was also a default in the payment of the principal portion of the debt which became due on April 25, 2014, but was paid on May 31, 2014.

The Company, RGBL and IFCI Limited (“IFCI”) have entered into a sale and subscription agreement dated December 16, 2010 (“SSA”) for sale of up to 49% of the equity shares of RGBL to IFCI. In accordance with the terms of the SSA, IFCI has also agreed to subscribe to the equity shares of RGBL as and when RGBL raises a demand for the same and in proportion to the equity infusion by GIPL so as to maintain their respective shareholding in RGBL. However, IFCI’s

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aggregate obligation to purchase and subscribe to the equity shares of RGBL under the SSA shall not exceed ₹8,648.00 lakhs and it shall not hold more than 49% of the total paid up equity share capital of RGBL at any point of time. In accordance with the terms mentioned in the SSA, the Company is required to buy back all the equity shares of RGBL purchased and subscribed by IFCI after the completion of the moratorium period of 18 months from share purchase date. A buy back agreement dated December 16, 2010 (“Buy Back Agreement”) has been entered into by the Company, RGBL and IFCI for same. However, due to certain exigencies, GIPL was unable to buy back the shares in accordance with the terms of the Buy Back Agreement and has agreed to buy back the remaining 64,860,000 equity shares upon terms and conditions agreed under the supplementary buy back agreement dated April 09, 2014. In relation towards the payment of the principal towards equity and the premium amount to IFCI, GIPL has failed to make payments towards principal towards equity amounts from March 2014 till August 2014 (on a monthly basis) and towards premium amount from May 2014 till August 2014 (on a monthly basis) amounting to ₹ 1,333.61 lakhs (excluding penal interest).

Our Subsidiary, RGBL has defaulted in the repayment of the principal and interest portion of the loan for the month of August 2014 which became over-due on September 2, 2014. The loan was availed vide the agreement dated May 26, 2009 from a consortium of four banks comprising of Bank of Baroda, Canara Bank, Union Bank of India and United Bank of India. The aggregate (principal and interest) default amount excluding penal or other interests is ₹ 710.46 lakhs.

The original project cost of our Mumbai Off-shore Container Terminal Project, being executed by ICTPL was ₹ 1,01,566.00 lakhs (including the cost of mechanical equipment). However, due to delays in handing over of the sites and delays in completion of capital dredging work by the licensor, the COD of the project has been extended by the licensor to January 31, 2016. Based on the cost overruns due to continuous delays on account of the licensor failing to complete their obligations within the time limits specified in the License Agreement, a rescheduling proposal was submitted to all the lenders. The Lead bank on appraisal of the said rescheduling proposal has estimated a revised project cost at ₹ 1,23,300.00 lakhs. This does not include the cost of the mechanical equipment. Further, the appraisal by the Lead Bank has recommended rescheduling the loan instalments to be paid. The Lead Bank has also recommended cut off date for the loan instalments to be paid as per the original common Loan Agreement at January 1, 2014. Over-due debt obligations for principal and interest portion (excluding penal and other interests) as at September 4, 2014 stand at ₹ 4,148.86 lakhs. The Lead Bank on request from ICTPL has approached the Reserve Bank of India for providing a special dispensation for extension of the COD beyond the guidelines set forth in the Master Circular issued by the Reserve Bank of India on Prudential Norms on Income Recognition, Asset Classification and Provisioning Pertaining to Advances.

Our Subsidiary, PBHL has initiated discussions with NHAI for mutual termination of concession agreement executed for 4-laning of the Patna – Buxar stretch of NH-30 and 84, in the State of Bihar, as PBHL is unable to initiate construction activities at the project site on account of non-availability of land and certain government approvals. The project has achieved the Financial Closure and PBHL have availed disbursement of ₹ 10,600 lakhs from the lenders. As of June 30, 2014, PBHL has repaid an amount equivalent to ₹ 6,200.00 lakhs and balance ₹ 4,400.00 lakhs remains unpaid. In accordance with the terms of the loan agreement, the existing situation qualifies for the trigger of the acceleration payment.

Our Subsidiary, PHPL has failed to make the interest payment (excluding the penal and other

interests) for the month of August 2014, which became over-due on September 2, 2014, amounting to ₹ 749.50 lakhs. The default is pertaining to the loan agreement dated August 18, 2010 as amended vide amendment no.1 to common loan agreement dated September 28, 2010 and as novated vide novation deed dated September 28, 2010.

Our Subsidiary, MNEL has failed to maintain the major maintenance reserve since July 2011 as required under the base case business plan pursuant to the agreement dated June 1, 2006 (as amended vide amendment no.1 to common loan agreement dated September 16, 2010).

Our Subsidiary, SHPVL has in the past not maintained the insurances for the period January to July 2014, as required under the common loan facility agreement dated January 15, 2014. The default has been cured.

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In relation to the subordinate loan of ₹12,000.00 lakhs availed by our Subsidiary, GICL, the last tranche of subordinate debt was payable on October 25, 2013 but the same was paid in instalments and got fully repaid on April 21, 2014.

There is no assurance that we will not breach any of the covenants in the future under our current or future financing agreements and that such breach will not cause a material adverse effect on our business, cash-flows, prospects and financial condition. While the lenders may not have declared an event of default under any of our financing agreements where there have been defaults (irrespective of their knowledge of such defaults) and though we continue to service our debts on their respective due dates, we cannot assure that the lenders will not seek to enforce their rights in respect of any past, present or future breaches or that we will be able to obtain any waivers from any or all lenders. In the absence of waivers for any non-compliance of the covenants, irrespective of payments of any penalties by us, we may continue to be in default of the covenants and our lenders have the right to accelerate payment of all amounts outstanding under the relevant loan agreements and declare such amounts immediately due and payable together with accrued and unpaid interest. Any such action by our lenders to declare us in default may trigger cross-default and cross-acceleration clauses under other loan agreements, and would have a material adverse effect on our business, cash-flows, prospects, financial condition and results of operations.

Further, during any period in which we are in default, we may be unable to raise, or face difficulties raising, further financing. If the obligations under any of our financing documents are accelerated it may also result in a decline in the trading price of the Equity Shares and may lose all or part of your investment. If the lenders of a material amount of the outstanding loans declare an event of default simultaneously, we may be unable to pay our debts as they fall due.

Further, we cannot assure you that our assets or cash flow would be sufficient to fully pay interest payments due or repay borrowings under our outstanding debt facilities, if accelerated upon an event of default, or that we would be able to refinance or restructure the payments on those debt facilities. Most of our financing arrangements are secured by movable, immovable or intangible assets, whether existing or future. If we are unable to repay, refinance or restructure the indebtedness of our Company or that of our Subsidiaries and Joint Ventures, which own or operate our properties, the lenders under those debt facilities could proceed against the collateral securing that indebtedness which constitutes substantially all of the assets and shares of our Company or those of our Subsidiaries, Joint Ventures and other investments. In that event, proceeds received upon realisation of the collateral would be applied first towards amounts due under those debt instruments. The value of the collateral may not be sufficient to repay all of our indebtedness, which could result in the loss of your investment as a shareholder.

5. Our Promoter and one of our Director have been barred by SEBI in the past.

SEBI, by its order dated December 21, 2006, had prohibited our Promoter and Abhijit Rajan and two other companies from directly or indirectly accessing the capital markets for a period of one year from the date of the order and further prohibited them from divesting, transferring, selling or alienating, in any manner, their shareholding in the Company for a period of three years from the date of allotment in the public issue of our Company. The periods of prohibition under the said order are over.

Pursuant to an order dated July 17, 2014, pending further investigation SEBI has restrained Mr Abhijit Rajan; one of our Directors and Promoter of GIL (our Promoter) from buying, selling or dealing in securities and accessing the securities markets, either directly or indirectly, in any manner whatsoever, till further directions that it may pass. The order held that Mr. Abhijit Rajan was an ‘insider’ and had access to ‘unpublished price sensitive information’ based on which he sold a part of his equity stake in our Company. In that relation, Our Company had on September 3, 2013, made a disclosure to the stock exchanges regarding termination of a Shareholders' Agreement dated April 26, 2012 entered into with Simplex Infrastructures Limited ("SIL") for purchasing 49% equity stake in Maa Durga Expressways Private Limited (hereinafter referred to as "Maa Durga Expressways") and for also selling 49% equity stake in Vijayawada Gundugolanu Road Project Private Limited.

Our Company had on August 9, 2013, passed a resolution for termination of the agreement in its board meeting and the said Termination Agreements were signed on August 30, 2013 by SIL and GIPL. On August 22, 2013, Mr. Abhijit Rajan sold 1,43,81,246 shares held by him in our Company (representing approximately 70.56% of his holding in GIPL as on August 22, 2013 ). SEBI has held that the 'unpublished price sensitive information' about the termination of the Shareholders' Agreement dated April 26, 2012 was in existence from the second week of July 2013 and it remained unpublished till September 03, 2013 when the disclosure with regard to the same was made to the exchanges. Further, it

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was held that Mr. Abhijit Rajan was reasonably expected to have access to the aforesaid 'unpublished price sensitive information' on all material times from second week of July 2013 and he was in possession thereof at least on August 09, 2013 when the board of directors of GIPL had approved the termination of Shareholders' Agreement.

SEBI has, in response to a clarification sought by our Company, on August 5, 2014 clarified that the SEBI order dated July 17, 2014 against Abhijit Rajan would not restrain the Company from accessing the securities market with the proposed qualified institutions placement.

6. We have faced delays in our projects, some of which are significant.

Our business requires extensive reliance on the client with whom we sign concessions with and on whom we are reliant for various activities to be undertaken and the same has to be completed within time in order to enable us to undertake our activities and generate revenues.

The road projects which have faced delays include some of our projects in the Operational Phase which are Gorakhpur Annuity Road Project, Kosi Bridge Annuity Road Project and Mumbai Nasik Expressway Toll Road Project. Additionally, some of our projects which are delayed are under the Development Phase which include the Rajahmundry Godavari Toll Road Project and Patna Highways Annuity Road Project. Similarly, the Mumbai Off-shore Container Terminal Project which is one of our port project has also been delayed. Two of our projects in the power sector are delayed namely Pravara Co-generation Power Project and Rangit II Hydroelectric Power Project. For further details refer to ‘Business’ on page 127.

Any further delays in our projects could have an adverse effect on our business, cash-flows, financial condition and results of operations.

7. Given the long-term nature of the projects we undertake, we face various kinds of implementation risks.

Typically, infrastructure development projects involve agreements that are long-term in nature. We derive a portion of our revenues from long-term concession or license agreements that usually range from 15 to 40 years. All of our long-term agreements have inherent risks associated with them that may not necessarily be within our control.

The fund requirements for few of our projects which would be under Pre-Development Phase or where we would be estimating cost overruns or re-scheduling of debts are based on the Company`s current business plan and on internal management estimates and have not been appraised by any bank or financial institution. In view of the nature of the industry in which we operate, our Company may have to revise its business plan from time to time and consequently its capital requirements may also change. The Company’s historical capital expenditure may not be reflective of its future capital expenditure plans.

We or the companies in which we invest may be adversely affected if the completion or commencement of operation of our projects under development or implementation is delayed or not be implemented due to any of the following:

the contractors (including sub-contractor) hired may not be able to complete the construction of projects on time, within the agreed budget or to the specifications and standards set out in contracts with them;

engineering problems;

shortages of, and price increases in, energy, materials, skilled and unskilled labour, and inflation in key supply markets;

changes in laws and regulations, or in the interpretation and enforcement of laws;

weather interferences, fire, natural disasters or delays;

inability of our clients to adhere to the terms of the agreements which we have entered into with them and undertake the obligations set out therein;

geological, construction, excavation, regulatory and equipment problems with respect to operating projects and projects under development;

drawings for the sites on which projects are expected to be developed may not be accurate as these drawings are generally dated;

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we or the companies in which we invest may not be able to obtain adequate working capital or other financing to complete construction of and to commence operations of our or their projects;

we or the companies in which we invest may not be able to recover the amounts invested if the assumptions contained in the feasibility studies for these projects do not materialise;

our power and roads customers may not off-take our power or use our toll roads in the expected quantities or at all or may not pay in full or at all;

governmental approvals and other approvals that are required for completion, expansion or operation of our projects may be delayed or denied;

environmental risk, including rehabilitation and resettlement costs; and

other unanticipated circumstances or cost increases.

There can be no assurance that any cost escalation or additional liabilities in connection with the development, expansion, conversion or relocation of new or existing projects would be fully offset by amounts due to us or the companies in which we invest pursuant to the guarantees and indemnities, if any, provided by our contractors or insurance policies that we maintain. We have in the past experienced cost overruns in relation to some of our projects in the Operational Phase which are Gorakhpur Annuity Road Project, Kosi Bridge Annuity Road Project and Mumbai Nasik Expressway Toll Road Project. Further, some of the projects under the Development Phase which have experienced cost overruns include the Rajahmundry Godavari Toll Road Project and Patna Highways Annuity Road Project. Similarly, the Mumbai Off-shore Container Terminal Project which is one of our port project has also been delayed and therefore has experienced cost overrun. Our projects in the power sector which are Pravara Co-generation Power Project and Rangit II Hydroelectric Power Project have also experienced cost overrun. See “Business” on page 127 for further details.

There can be no assurance that our current or future projects will be completed, on time or within budget. Delays in completion and commercial operation of our projects under Development Phase and Pre-development Phase could increase the financing costs associated with the construction and cause our forecasted budgets to be exceeded. We cannot assure you that our construction costs or total project costs for our projects will not increase in the future. Business circumstances may materially change over the life of one or more of our concession or implementation agreements and we may not have the ability to modify or renegotiate or change the terms or seek extensions of these agreements executed with the clients to reflect these changes. For example, our Cochin Bridge Project is not permitted to undertake any tolling as the concession period which was extended pursuant to a notification was revoked. See “Legal Proceedings” on 212.

Further, our commitments and obligations under these agreements may restrict our ability to implement changes to our business plan, including reducing our shareholding in the relevant SPVs. This may limit our business flexibility, expose us to an increased risk of unforeseen business and industry changes and could have an adverse effect on our business, cash-flows, financial condition and results of operations.

8. The review report of Joint Auditors in respect of our Unaudited Consolidated Interim Condensed

Financial Statements prepared by the Company as at and for the period ended June 30, 2014 contains a qualification.

The Joint Auditors review report dated August 13, 2014 on the Unaudited Consolidated Interim Condensed Financial Statements of the Group was qualified to indicate the impact arising out of one of our Subsidiaries which had issued a notice of intention to terminate the concession agreement with NHAI. The Group’s exposure to this project includes project expenses of ₹ 6,935.61 lakhs and guarantees of ₹ 5,646.00 lakhs. There can be no assurance that our Joint Auditors will not qualify their opinion in the future.

9. Shipping lines generally operate under fixed schedules and any change in their vessel calling

patterns may have an adverse effect on our port business, results of port operations and related financial condition.

Shipping lines tend to operate on fixed schedules and generally review their calling patterns periodically and accordingly book time-slots for docking and undocking. The increase or decrease in calls and the stay period depends on trade patterns and volume growth. In some of our port projects, the dredging work is currently in progress. Therefore, we may not have access to certain parts of the port

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on certain days for our activities which we are permitted to undertake pursuant to the agreements. In the event that such dredging activities are not completed within such times as indicated to us, it would not be possible for us to adhere to the timelines of these shipping lines which may lead to loss of revenues. As the dredging work is undertaken in periodic schedules, till the same is complete free movement of the ships would not be possible.

Any decrease or change in the vessel calling patterns of these lines at our port could result in our port berths remaining unoccupied for certain durations, which will have an adverse effect on our business, cashflows, results of operations and financial condition. Further, any unilateral alteration of schedule by shipping lines could also affect the operations of our port and may affect our business and profitability.

10. We are subject to restrictive covenants in the loan agreements that we have entered into with our lenders.

There are various restrictive covenants in the financing agreements that we have entered into with banks for our borrowings, including, but not limited to, the requirement that we obtain prior consent of our lenders inter alia, for: implementing a new scheme of expansion; borrowing or obtaining any credit facilities from other banks or credit agencies or money

lenders; creating further charge on the assets provided as security; altering the memorandum and articles of association of our Company; and entering into any merger or scheme of amalgamation or compromise with our creditors or

shareholders or effecting any scheme of amalgamation or reconstruction.

Further certain of our facilities granted by lenders impose restrictions on alteration of the capital structure of our Company or effecting a change in the ownership or constitution of our Company without the prior consent of the concerned lenders. We cannot assure investors that we will receive such approvals in a timely manner or at all. In addition, these restrictive covenants also affect our rights and the rights of the relevant borrowing Subsidiary to pay dividends, if we are in breach of our obligations to pay amounts owed by us under the relevant financing agreement. Such financing agreements may also require us to fulfil necessary covenants as set out in the agreements which include maintaining an appropriate debt to equity ratio. As a result of these restrictive covenants, we may be more vulnerable to economic downturns, may be limited in our ability to withstand competitive pressures and may have reduced flexibility in responding to changing business, regulatory and economic conditions. We have in the past, on occasions, failed to observe certain restrictive covenants and undertakings in our financing documents, where the relevant restrictive covenant prohibited such actions without prior approval.

11. We rely substantially on Government-owned and Government-controlled entities for our revenues.

Political or financial pressures or other delays could cause these entities to force us to renegotiate our agreements or delay our operations and could also adversely affect their ability to pay us.

Most infrastructure development projects under public private partnership in India, including majority of our projects, have been awarded by Government-owned or Government-controlled entities and, therefore, may be subject to political or financial pressures. This may lead to such agreements being restructured or renegotiated by these entities, which could adversely affect our business, cash-flows and results of operations. For instance, in relation to our Cochin Bridge Project, where we were obstructed from collecting toll by the Greater Cochin Development Authority with effect from April 27, 2014 pursuant to a unilateral sealing of the toll booth, we are now currently involved in a legal proceeding. Further, we shall also be responsible for the repayment of the outstanding loans which have been borrowed by CBICL and expenditures incurred in relation to the project may have to be written off. For details see “Legal Proceedings” on page 212.

In relation to our Visakhapatnam Port Project, there have been delays in dredging work which is yet to be completed. Such delays, impact the smooth flow of our operations. Additionally, in our Mumbai Off-shore Container Terminal Project, the dredging work is yet to commence which is required to be undertaken and provided to us by the client. In light of the same, we cannot effectively operate our berths to the maximum capacity and on a daily basis or also commence operations in one port which may affect our business, financial condition and results of operations.

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Additionally, our projects may often be subject to delays on account of various factors such as a change in the central and/or State Government, changes in policies impacting the public at large, scaling back of Government policies or initiatives, land acquisition, changes in Governmental or external budgetary allocation, or insufficiency of funds, which can significantly and adversely affect our business, cashflows, financial condition and results of operations.

12. Our operations are, and will continue to be, primarily dependent on operating assets which are generating revenue. If the operation of one or more of these assets is disrupted and we are not able to collect toll or are not paid annuities on time or at all, it would have a material adverse effect on our financial condition, cash flows and results of operations.

Presently, our revenues are substantially derived from our operating SPVs which are REL, AEL, KBICL, GICL, MNEL and VSPL. Some of these projects are annuity based where we receive certain fixed revenues while our Mumbai Nasik Expressway Toll Road Project and our Visakhapatnam Port Project is dependant on the traffic movement and users of these facilities. The annuity income, the toll revenue and revenue from port operations are ₹ 20,842.00 lakhs, ₹ 9,627.11 lakhs and ₹ 8,630.50 lakhs, respectively for the nine month period ended December 31, 2013.

For our Gorakhpur Annuity Road Project, as per the letter dated June 30, 2014, GICL has notified NHAI about the non-receipt of annuity due on April 4, 2014, which was not released on account of non-completion of remaining punch-list items but has subsequently been paid to us. Pursuant to the non-receipt of the annuity payments, GICL had consequently defaulted in the repayment of the installment of the debt availed from IDFC Limited. Also, we have in the past faced disruptions in our project undertaken by our SPV, MNEL which let to the temporary closure of the toll plaza which led to non-collection of toll during that period. Until the commercial operation of our projects under Development Phase and Pre-development Phase, we will continue to be substantially dependent on our Projects under Operations Phase specified above. If one or more of these project concessions are terminated or we decide not to proceed with such projects and our losses might not be adequately covered by the relevant insurance policies, or if any such project undergoes maintenance for a longer period than was estimated, our business, cash-flows, financial condition and results of operations and cash flows could be adversely affected.

13. Our Promoter, GIL in its board meeting held on August 21, 2014 has approved the sale of 52,80,00,000 Equity Shares of our Company held by GIL to its subsidiary Gammon Power Limited.

In the board meeting of GIL, held on August 21, 2014, the board has approved the sale of the entire equity capital of GIPL held by GIL to Gammon Power Limited, which is a subsidiary of GIL. The consummation of the sale is conditional upon the receipt of the shareholders’ approval. Although, Gammon Power Limited (“transferee”) is a subsidiary of our Promoter, and our Promoter can exercise indirect control over our Company, there is no assurance that the transferee will not further transfer our shares to any third entity. Further, in case of a change in our Promoter, we cannot assure continued assistance and support from GIL.

14. More than 50.00% of our shareholding held by our Promoter prior to the Issue has been pledged with one lender.

Our Promoter, GIL has pledged 58.62% of our shareholding held by them with IDFC Limited. In the event that there is any breach or default under such loan agreement pursuant to which the equity shares of our Company held by GIL have been pledged, the lenders may enforce their rights under the respective agreements and enforce their security interest which may result in a change in our control and we shall cease to be a subsidiary of GIL. Pursuant to any of the above, there could be an adverse impact on the price of our equity shares. We shall not be able to ascertain who our shareholders upon such sale shall be or whether their interests shall be aligned to that of the Company.

15. Increase in interest rates may materially impact our results of operations.

As our businesses are capital intensive, we are exposed to interest rate risk. Substantially all of our secured and unsecured debt carries interest at fixed rates or at floating rates that are subject to adjustments at specified intervals. We have not entered into any swap or interest rate hedging transactions in connection with our loan agreements, although we may decide to engage in such transactions in the future. In the case of some of our Subsidiaries and our Joint Ventures we are unable to pass any increase in interest rate to our existing customers. Any increase in interest rate may have an adverse effect on our business prospects and results of operations.

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Although we may decide to engage in interest rate hedging transactions, there can be no assurance that we will be able to do so on commercially reasonable terms, that our counterparties will perform their obligations, or that these agreements, if entered into, will adequately protect us against interest rate risk. The total finance cost amounted to ₹ 21,902.87 lakhs and ₹ 29,683.38 lakhs for the years ended December 31, 2013 and March 31, 2013 respectively.

16. Our growth strategy depends upon our success in securing the award of new projects.

The growth of our business depends on our ability to secure new projects. Generally, it is very difficult to predict whether and when we will be awarded a new contract since many potential projects involve a lengthy and complex bidding and selection process that may be affected by a number of factors, including changes in existing or assumed market conditions, financing arrangements, environmental matters and governmental approvals.

Most projects are awarded pursuant to a competitive bidding process and involve satisfaction of technical and financial qualifications. Technical qualifications for projects typically relate to past experience, technical/engineering expertise and financial resources, and are required to be fulfilled by bidders to enable them to submit price bids. There can be no assurance that we will always be able to satisfy such technical qualifications. Further, competitive pricing is a major factor in most tender awards. Even when we satisfy the technical qualifications, we may not be the lowest bidder on price, and hence may not be awarded concessions or licences. Further, when submitting our bid for BOT projects, we need to forecast the traffic volume for the project to bid for such contract. The awarding of a BOT project is subject to a competitive tender and if we are too conservative in our forecast of traffic volumes, we may under bid and will not be awarded the BOT project. As the growth of our business is primarily dependent on award of new projects, our future results of operations and cash flows can fluctuate materially from period to period depending on the timing of the project awards.

17. We operate in a highly competitive environment and if we are not able to compete effectively, our income and profitability could be adversely affected.

Our competitors may have extensive local knowledge and business relationships and a longer operational track record in selected areas of the domestic market than us. Some of these companies have significant financial resources, marketing and other capabilities. Some of our international competitors are able to capitalise on their overseas experience to compete in the Indian market. As a result, there can be no assurance that we will be able to compete successfully in the future against our existing or potential competitors or that our business, financial condition and results of operations will not be adversely affected by increased competition.

In our business, we compete with both domestic and international companies, including ports located on the west coast of India, other ports located in Andhra Pradesh, and other port service providers and intermediaries that operate at existing ports such as handling, stevedoring, clearing and forwarding agents. Current and future competitors may also introduce new and more competitive services, make strategic acquisitions or establish cooperative relationships among themselves or with third parties, thereby increasing their ability to address the needs of our target customers.

If we cannot compete in providing competitive services (like in the case of our Port Business) or expanding into new services, this could have an adverse effect on our business, financial condition and results of operations. There can be no assurance that we will be able to retain our customers in the face of increased competition.

18. Our port business and facilities may be adversely affected by severe weather conditions or natural disasters.

Our port business and operating facilities may be adversely affected by severe weather conditions, such as heavy rains and flooding, dense fog and low visibility, climatic changes or natural disasters such as earthquakes, tsunamis and hurricanes. Severe weather conditions or climatic changes, resulting in conditions such as dense fog, low visibility, heavy rains, wind and waves, may force us to temporarily suspend operations. In some cases, we may temporarily suspend operations based on warnings from local and national meteorological departments. If weather conditions or climatic changes of any type were to force Visakhapatnam Port to close for a period of time, our business could be adversely affected.

In addition, any weather condition or climatic change, including but not limited to severe monsoons or

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flooding, affecting ports that serve as starting points or final destinations for shipping lines could harm our business. Our operating facilities may be damaged in natural disasters such as earthquakes, tsunamis, tornados, hurricanes and cyclones. Such natural disasters in India or in Southeast Asia may lead to a disruption of transportation networks, information systems and telephone service for sustained periods of time. Further prolonged spells of below normal rainfall or other natural calamities could have a negative impact on the Indian economy, adversely affecting our business. Although we may be insured for such risks, any damage or destruction that interrupts our operations may cause us to incur substantial additional expenses to repair or replace damaged facilities or equipment.

19. If we cannot bid in our own right, and we are unable to find suitable joint venture partners, we may be ineligible for bidding for certain infrastructure-related contracts and projects.

Our ability to bid for and win major projects is dependent on our ability to show experience in executing large projects, demonstrate that we have strong engineering capabilities in executing technically complex projects, and that we have sufficient financial resources and/or ability to access funds. For many large infrastructure development projects that we bid for, we may be required to partner and collaborate with other, often bigger, companies in bids for these large infrastructure projects.

We face competition from other bidders in a similar position to us in looking for suitable joint venture partners with whom to partner in order to meet the pre-qualification requirements. If we are unable to partner with other companies or lack the credentials to be the partner-of-choice for other companies, we may lose the opportunity to bid for projects.

We have in the past bid for projects with such partners who we believe have the expertise and we can effectively execute projects with. We cannot assure you that we will continue to find such partners to bid for projects and there will be no disputes with such partners.

20. Our flexibility in managing our operations is limited by the regulatory and political environment in which we operate.

The infrastructure sector in India, particularly in relation to the power, road and port industries, is highly regulated. Our businesses are regulated by various authorities and State Governments, including the Ministry of Shipping, Road Transport and Highways, NHAI, Visakhapatnam Port Trust, the Ministry of Power, Mumbai Port Trust, Mormugao Port Trust, Andhra Pradesh Road Development Corporation, Madhya Pradesh Road Development Corporation Limited and Tariff Authority for Major Ports (“TAMP”). We may be restricted in our ability to, among other things, increase prices, sell our interests to third parties, undertake expansions and contract with certain customers.

For example, under the relevant agreements with the Government of Sikkim and Government of Himachal Pradesh for the Rangit II Hydroelectric Power Project and Youngthangkhab Hydroelectric Power Projects, respectively, we are required to give preference to the local population in the recruitment of skilled and unskilled employees. Further, the Visakhapatnam Port Project, and the Mumbai Port Project are located at ports classified as “major ports” under the Major Ports Trusts Act, 1963, and are consequently subject to tariffs regulated by TAMP. These ports do not have the flexibility to determine certain charges and dues that are payable by vessels as TAMP has the authority to fix charges for pilotage, mooring and other services rendered to vessels. While there can be no assurance that such tariffs will not increase rates to an extent that cause customers to seek alternative ports in the future or that the tariffs will remain at a level that enables us to earn the anticipated return on capital. Such restrictions may limit our flexibility in operating our business, which could have an adverse effect on our business, prospects, financial condition and results of operations.

All infrastructure projects require substantial tracts of land for the setting up of the projects. The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (the “Land Acquisition Act, 2013”) has come into force with effect from January 1, 2014. However, the rules related to its implementation are yet to be notified. The Land Acquisition Act, 2013, inter alia, stipulates (i) restrictions on land acquisition (e.g. certain types of agricultural land), and (ii) compensation, rehabilitation and resettlement of affected people residing on such acquired land.

Additionally, in the power sector, the Electricity Act provides for significant deregulation. Whereas the Government presently owns a majority of the generation business and nearly all transmission and distribution businesses and there are only a limited number of distribution licensees and independent power producers, such as us, the Electricity Act permits new generation plants to come into existence

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without restriction, except for limited approval requirements for hydroelectric power projects. Furthermore, proposed changes in power tariff policy based on the CERC Approach Paper by public notice dated June 25, 2013, the unbundling of the state electricity boards of India and consequent restructuring of companies in the power sector, open access and parallel distribution, and liberalized licensing requirements for, and tax incentives applicable to, companies in the hydroelectric power sector may provide opportunities for increased private sector involvement in power generation. For instance, the Electricity Act, 2003, removes licensing requirements for thermal power generators, provides for open access to transmission and distribution networks, and removes restrictions on the right to build captive generation power plants. Specifically, the open access reforms enable the generators to sell their output directly to the distribution companies, and ultimately, to the consumers and may increase the financial viability of private investment in power generation. Furthermore, the Hydro Power Policy 2008 aims to encourage and increase private investment in the development of hydropower by providing financial benefits such as an income tax holiday for 10 years. The Hydro Power Policy, 2008 also seeks to encourage joint ventures with private developers, the use of an independent power producer model and promotes power trading by speeding up the clearance procedures. Large Indian businesses that already have a presence in the Indian power sector, specifically in captive power generation, may seek to expand their operations in the hydroelectric power sector. Any increase in competition may result in a material adverse effect on our business, prospects and financial condition.

Further, there are new regulators that the government may introduce that would regulate certain aspects of our business. In particular the introduction of a regulator overseeing the roads and mining activities in India may increase the levels of regulatory scrutiny and compliance for these businesses.

In the roads sector, the NHAI has introduced a model concession agreement for new road concessions that has changed the terms traditionally associated with road concessions in India. Among other changes, these terms limit revenues that may be earned from a concession, introduce uncertainty into the period of a concession and fix deadlines for environmental clearance with respect to a concession. These restrictions limit our flexibility in operating our business, which could have a material adverse effect on our business, prospects, financial condition and results of operations.

21. We operate in an industry that is capital intensive in nature and we may not always be able to raise the required capital on favourable terms for current and future projects that may have an adverse effect on our business and results of operations.

Infrastructure projects are typically capital intensive and may require high levels of financing, including debt financing. If we decide to meet our capital requirements through debt financing, our interest obligations will increase and we may be subject to additional restrictive covenants. If we decide to raise additional funds through the issuance of equity or equity-linked instruments, the interests of our existing shareholders will be diluted.

Further, under the terms of the license or concessions agreements entered by us in relation to certain infrastructure projects, we are required to achieve Financial Closure of such projects within a specified timeframe. We may not be able to achieve the Financial Closure within the specified timeframe which may result in delay in such project or breach of the terms of the license of concession agreements. In relation to some of our projects, although we were able to achieve Financial Closure, owing to delays in the completion of condition precedents by our clients, we were unable to commence construction on time. In light of the same, we were required to revalidate the loan agreements that we had completed.

We cannot assure you that we will be in a position to revalidate the sanction letters or raise funds at short notice. Additionally, we cannot assure you that market conditions and other factors would permit us to obtain future financing on terms envisaged by us. Our ability to arrange financing on a substantially non-recourse basis and the costs of capital of such financing are dependent on numerous factors, including general economic and capital market conditions, credit availability from banks, investor confidence, the continued success of our current projects and laws that are conducive to our raising capital in this manner. Changes in the global and Indian credit and financial markets and recent increases in the lending rates in India have significantly diminished the availability of credit and led to an increase in the cost of financing. In many cases, the markets have exerted downward pressure on the availability of liquidity and credit capacity. Our attempts to obtain future financings on favourable terms may not be successful. In addition, our ability to raise funds, either through equity or debt, is limited by certain restrictions imposed under Indian law.

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We cannot assure you that we will be able to raise adequate capital in a timely manner and on acceptable terms. This may result in an adverse effect on our results of operations and financial condition.

22. We are in discussions with some of our lenders to revalidate and/or reschedule our existing loan

agreements for some of our projects.

As our businesses are capital intensive, we are exposed to incur significant debts. Additionally, in some cases we may also be required to revalidate some of the existing debt or restructure these loans.

For example: Sidhi Singrauli Toll Road Project was successful in ensuring the revalidation of our loan

agreements; Vijayawada Gundugolanu Toll Road Project, owing to the delays in the project we have not

been able to drawdown the sanctioned loan facilities which subsequently lapsed. We have requested the lender for the revalidation of the same which has been pending for sometime now. We cannot assure you that the said facility shall be revalidated or within such time as maybe required by us or at all. In the event that we are not able to revalidate the same or raise the required funds for the project, we may lose the rights to develop and construct the project.

Additionally, in some of our projects we are also in the process of rescheduling our debts and are in discussions with our lenders. Some of these projects include Rajamundry Godavari Toll Road Project, Pravara Co-generation Power Project, Rangit II Hydroelectric Power Project and Mumbai Off-shore Container Terminal Project. See “Business” on page 127 for further details.

23. We require certain registrations and permits from government and regulatory authorities in the

ordinary course of business and the failure to obtain them in a timely manner or at all may adversely affect our operations.

We require a number of approvals, licenses, registrations and permits for operating our businesses. Whilst we have obtained a significant number of approvals for our businesses, certain approvals which we have applied for are currently pending. Moreover, we may need to apply for additional approvals and licenses in future. Further, we may need to renew some of the approval and licenses, which may expire, from time to time, in the ordinary course of business. If we fail to obtain or renew any applicable approvals, licenses, registrations and permits in a timely manner, our ability to undertake our businesses may be adversely impacted, which could adversely affect results of operations and profitability.

There can be no assurance that we will be able to obtain any approvals, licenses, registrations or permits in a timely manner, or at all, and there can be no assurance that the relevant authorities will issue or renew any such approvals, licenses, registrations or permits in the time frames anticipated by us. Further, we cannot assure that the approvals, licenses, registrations and permits issued to us would not be suspended or revoked in the event of non-compliance or alleged non-compliance with any terms or conditions thereof, or pursuant to any regulatory action. Furthermore, our Government approvals and licenses are subject to numerous conditions, some of which are onerous and require us to make substantial expenditure. If we fail to comply, or a regulator claims we have not complied, with these conditions, our business, financial condition and results of operations would be adversely affected. Any failure to renew the approvals that have expired or apply for and obtain the required approvals, licenses, registrations or permits, or any suspension or revocation of any of the approvals, licenses, registrations and permits that have been or may be issued to us, may impede our operations and we may be required to incur additional expenditure in this regard.

24. The multiple role of certain Government entities as our regulator, customer, joint venture partner

and direct or indirect competitor may give rise to conflicts of interest that may harm us.

We have entered into agreements with Government entities, including NHAI, Greater Cochin Development Authority, Mumbai Port Trust, Andhra Pradesh Road Development Corporation and the Board of Trustees of Visakhapatnam Port Trust, in various capacities. Some of these Government entities are also counterparties in the contracts entered into with our competitors, or in some cases,

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carry on activities that compete with our business. For example, NHAI is our sole client for the Rajahmundry Expressway Annuity Road Project, Andhra Expressway Annuity Road Project, Gorakhpur Annuity Road Project, Kosi Bridge Annuity Road Project, Patna Highway Annuity Road Project and Mumbai Nasik Expressway Toll Road Project.

We may face or suffer potential conflicts of interest, which may arise from the fact that such Government authorities play multiple roles in our business model as customers, competitors and regulators. We cannot assure you that potential conflict of interest situations will not continue to arise in the future or that any disputes arising in relation thereto will be resolved in a manner favourable to us. Any such situation may have an adverse effect on our business, financial condition and results of operations.

25. We face margin pressure as a large number of infrastructure-related contracts are awarded by the

Central Government and State Governments following competitive bidding processes.

Most of the infrastructure-related contracts are awarded by the Central Government, State Governments or their respective authorised agencies through competitive bidding processes and satisfaction of other prescribed pre-qualification criteria. Once the prospective bidders clear the technical requirements of the tender, the contract is usually awarded to the most financially competitive bidder. We face competition from domestic and international companies, some of whom may operate on a larger scale than us and thus may be able to achieve better economies of scale than us. Further, the premium placed on having experience may cause some of the new entrants to accept lower margins in order to be awarded a contract. The nature of the bidding process may cause us and our competitors to accept lower margins in order to be awarded the contract. We may also decide not to participate in some projects as accepting such lower margins may not be financially viable and this may adversely affect our competitiveness to bid for and win future contracts. This may have an adverse impact on our business prospects and results of operations.

26. In case we lose any of the present tax benefits and any change in tax policies applicable to us may

affect our results of operations.

The governmental and regulatory bodies in India may notify new regulations and / or such policies or their interpretations thereof, either by a court of law, regulatory authority or otherwise, which may impose onerous requirements and conditions on our operations in addition to what we are undertaking currently, as well as subject us to additional approvals and licenses from the Government and other regulatory bodies.

In accordance with and subject to the conditions specified in Section 80-IA of the IT Act, we and certain subsidiaries of ours maybe entitled for a deduction of an amount equal to hundred percent of profits or gains derived from any enterprise carrying on business of (i) developing or (ii) operating and maintaining or (iii) developing, operating and maintaining any infrastructure facility (iv) generating or (v) generating or distributing of power for any ten consecutive assessment years out of fifteen years beginning from the year in which the enterprise has started its operation. At present, no benefit under this section is allowed with respect to any undertaking which begins to generate or generation and distribute power at any time after 31st day of March 2017 unless the same is further extended to any future date. We cannot assure you that such benefits shall not be withdrawn in the future.

The Government of India has recently passed the budget for the current fiscal. The proposal as passed in the Union Budget of India in July 2014 may have implications on the business of the Company, from such effective date. Any uncertainty in the applicability, interpretation or implementation of any amendment to or change in governing law, regulation or policy in our industry in the jurisdictions in which we operate (including by reason of an absence, or a limited body, of administrative or judicial precedent) may be time consuming as well as costly for us to resolve, and may impact the viability of our current business or restrict our ability to grow our business and have a material adverse effect on our business, prospects, financial condition and results of operations.

27. We may encounter problems relating to the operations of our joint ventures.

As a consequence of qualification and client requirements and to mitigate risks associated with projects, certain of our current operations are conducted through joint venture companies. For example,

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we have joint ventures for our projects under Operations Phase which include the Mumbai Nasik Expressway Toll Road Project and the Visakhapatnam Port Project. We also have joint venture arrangements for few of our projects which are currently under Development Phase and in the Pre-development Phase including the Mumbai Port Project and Tidong Hydroelectric Power Project.

We anticipate that certain of our future projects will continue to be developed and maintained through joint ventures as we continue to jointly bid for contracts with suitable joint venture partners. Typically, bid documents provide that we are jointly and severally liable to clients for the performance of our joint venture partners’ obligations. If any of our joint venture partners fail to perform their obligations satisfactorily, we may be required to make additional investments and/or provide additional services to ensure the timely completion of such joint venture projects. The inability or unwillingness of a joint venture partner to continue with a project due to financial or legal difficulties or any other reasons, could mean that we may be required to bear increased and possibly sole responsibility for the completion and operation of the project and bear a correspondingly greater share of the financial risk of the project. These additional obligations could result in reduced profits or, in some cases, significant losses for us.

In the event of any disagreements between us and our various joint venture partners regarding the business and operations of the joint ventures, we cannot assure you that we will be able to resolve them in a manner that will be in our best interests, which could have an adverse effect on our business, financial condition and results of operations.

` Additionally, JV partners or contractors or sub-contractors may not have adequate financial resources

to meet their indemnity obligations to us. Losses may derive from risks not addressed in indemnity agreements or insurance policies, against some risks on commercially reasonable terms. Failure to effectively cover against risks for any of these reasons could expose us to substantial costs and potentially lead to material losses. The occurrence of any of these possibilities may also adversely affect industry perception and the perception of suppliers, clients and employees, leading to an adverse effect on business, results of operations and financial condition.

Some of the developments in relation to our projects where we have joint venture partners are set out below:

The Company, Dragados and ICTPL have entered into a share purchase agreement, dated July

29, 2010, pursuant to which the consortium partner has agreed to sell 24,375,840 equity shares of ICTPL, constituting 24% shareholding of ICTPL to the Company, subject to receipt of regulatory approvals, including the approval of the Mumbai Port Trust and the lenders of the Mumbai Container Terminal Project. Further the Company, the consortium partner and ICTPL have entered into an agreement to sell, dated July 29, 2010 (“Agreement to Sell”), pursuant to which the consortium partner has agreed to sell 26,407,160 equity shares of ICTPL, constituting 26% shareholding of ICTPL to the Company, subject to receipt of regulatory approvals. Whilst the share purchase agreement and the Agreement to Sell expired in January 2011, the Company entered into a supplemental agreement for renewing the same. The Company received a letter dated June 25, 2014 for an extension for the closure of the transaction by November 30, 2014.

In relation to our Tidong Hydroelectric Power Project, our joint venture partner in the project has indicated that it proposes to transfer the equity shares held by it to GIL. The Directorate of Energy, Government of Himachal Pradesh had asked for the rationale for the transfer, which has been responded to. In the event that the approval for the transfer of such shares is not granted, we may not be able to continue with this project.

28. The operations and management contracts entered into by the Company are typically fixed price

contracts. Increase in cost of operations and maintenance of these projects due to increase in costs of raw materials and labour would adversely affect our profitability.

The operation and management contracts entered into by the Company are typically fixed price contracts with or without escalation clause. Increase in cost of operations and maintenance of these projects due to increase in costs of raw materials and labour would adversely affect our profitability. For example, under the Operations and Management Sub-Contract dated March 31, 2006 entered into

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by the Company with GIL for the AEL Annuity Road Project and the REL Annuity Road Project (“REL AEL O&M Agreement”), certain fixed semi-annual payments (with semi-annual escalation of 3%) for carrying out routine maintenance and certain major maintenance payments are payable to the Company at the end of 5th, 10th and 15th year from the COD for the periodic maintenance works. However, the actual costs that the Company may incur for such maintenance may be higher than our estimates depending on the increase in costs of raw materials and labour. We may not be able to pass through such increased cost to GIL under the provisions the O&M Sub-Contract. Further, certain essential raw materials such as bitumen have high price volatility and a steep rise in its price can have adverse effect on our profitability and results of operations.

29. We are involved in legal proceedings some of which involve the concession agreement we have

signed.

There are outstanding legal proceedings involving us in relation to our projects. Such legal proceedings include disputes relating to non-payment of contractual dues, arbitral proceedings relating to non-payment under concession agreements, tax proceedings and cases related to land acquisition for our projects and dishonor of cheques. These proceedings are pending at various stages of adjudication before various courts, tribunals, appellate authorities and arbitrators. For further details of certain of our outstanding litigation, please see the section “Legal Proceedings” on page 211.

We cannot assure you that the legal proceedings involving us will be decided in our favour or that no further liability will arise out of these proceedings. Further, such legal proceedings could divert management time and attention and consume financial resources. Further, any adverse outcome in any of these proceedings may adversely affect our profitability and reputation and could have a material adverse effect on our business prospects, financial conditions and result of operations.

30. Our revenues are highly dependent on a few major clients. The loss of any of these clients may

adversely impact our revenues and profitability.

We derive a significant portion of our revenues from a limited number of clients. We currently generate our road revenues from the Rajahmundry Expressway Annuity Road Project, Andhra Expressway Annuity Road Project and Mumbai Nasik Expressway Toll Road Project, Kosi Bridge Annuity Road Project, and Gorakhpur Annuity Road Project where our client is NHAI. Some of our Road Projects under construction and development are with NHAI, who is our client. The loss of business from these clients may adversely impact our business, revenues and profitability.

In the past we have experienced difficulties, recovering some of the amounts due to us under contractual arrangements for our operational projects. See “Legal Proceedings”.

31. Our clients may default on their payment obligations to us, which would have an adverse effect on

our results of operations.

Our profitability depends on timely receipt of annuities, fees and other charges due from our customers for our projects. There can be no assurance that there would be no default in payments by our customers of the amount payable to us under the terms of various concession agreements. For example, we are involved in an arbitration proceeding with the Government of Kerala with respect to payment of annuity for our Cochin Bridge Project. Further, there have been instances in the past where certain of our projects have commenced operations before their scheduled COD for which, under the terms of the concession agreements, we were entitled to bonus payments, the receipt of which were delayed. Our Rajahmundry Expressway Annuity Road Project, Andhra Expressway Annuity Road Project commenced operations before schedule and we were entitled to receive bonus payments. Such bonus payments were disputed by Client. Although we have been successful in recovering such bonus payments (in whole or in part), there can be no assurance that if any of our customers will default in their payment obligations to us in the future, we will be able to recover the due payments in full or in a timely manner. Failure on the part of our clients to fulfill their payment obligations under their agreements with us would have an adverse effect on our revenues, ability to service our debt, business, financial condition and results of operations.

32. We are involved in a dispute in relation to the concession agreement for the Cochin Bridge Project

which may affect our revenues.

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The revenues of CBICL for the Cochin Bridge Project are generated by toll collection, which rates were subject to an annual revision linked to the WPI of the Central Government under the terms of the concession agreement. However, the Government of Kerala, by way of orders dated January 24, 2005 and March 1, 2005, held that the toll rates would remain constant throughout the concession period and introduced the multiple-entry pass adversely affecting the revenue generation of CBICL and in return proposed that CBICL will be compensated with annuity payments of ₹154.00 lakhs starting from January 2004, and an extension of six years in the concession period and payment of compensation for issue of multiple-entry passes to cars. CBICL has not received the annuity payments and the revised concession agreement incorporating the terms of the aforesaid orders has not been signed by the Government of Kerala. CBICL has initiated an arbitration proceeding against the Government of Kerala and Greater Cochin Development Authority for execution of the revised concession agreement, payment of annuity due and payment of compensation for issuing multiple-entry passes to cars. In the event of an adverse development in the arbitration proceeding, CBICL may suffer shortfall in revenues, which could have an adverse effect on our results of operations.

33. We have filed claims before the NHAI and other government authorities in relation to our projects.

We have filed various claims before the NHAI in relation to certain aspects related to our projects. Some of these claims are in relation to payments which we believe are due to us. We cannot assure you that such claims filed by us will be considered or honoured. In the event that such claims made by us are not accepted, we may have to explore other options including initiating legal proceedings which may involve substantial costs for us. We cannot predict the outcome of such proceedings. Any adverse proceedings of any litigation arising from such claims could have a material adverse effect on our business.

34. Our projects can be delayed on account of the principal or contractor’s performance, resulting in

delayed payments. Although, we do not have significant experience in our EPC business, we have in the past and continue

to contract the EPC work for two of our projects on a fixed price basis. We further depend on the performance of our sub-contractors for completion some of our projects. We cannot assure you that suitable sub-contractors will continue to be available at reasonable rates, or at all. As a result, we may be required to make additional investments or provide additional services to ensure the adequate performance and delivery of contracted services.

The execution risks we face using contractors include:

sub-contractors so appointed by them who may not be able to complete the project

construction on time or within budget that have been set in the contracts with them; delays in meeting project milestones or achieving commercial operation by the scheduled

completion date could increase the financing costs associated with the construction and cause our forecast budget to be exceeded;

contractors may not be able to obtain adequate working capital or other financing on favourable terms to complete construction;

we may not be able to pass on certain risks to contractors such as unforeseen site and geological conditions which may make the site unsuitable for the project;

delays in availability or availability at unacceptable prices of steel, diesel, bitumen, construction equipment and other materials leading to disruption in construction schedules; and

as we expand geographically, we may have to sub-contract work related to our projects to such sub-contractors with whom we are not familiar, which could increase the risk of cost overruns, construction defects and failures to meet scheduled completion dates.

Even when we sub-contract work, we remain responsible for the sub-contracted work which means clients still have recourse to us in respect of actions, omissions and defects by our contractors or sub-contractors.

In relation to our Kosi Bridge Annuity Road Project, the EPC contractor has initiated claims for escalation in the Project costs which has been acknowledged and accepted. However, we have not

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made any corresponding claims against NHAI for the same. 35. All of our projects are subject to financing, construction and operational risks in addition to risks

such as inclement weather and natural disasters and other local risks.

The development and operations of our projects carries many risks, which, to the extent they materialize, could adversely affect our business, prospects, financial condition and results of operations. These risks include:

political, regulatory and legal actions that may adversely affect project viability; changes in government and regulatory policies; delays in construction and operation of projects; adverse changes in market demand or prices for the products or services that the project, when

completed, is expected to provide; the willingness and ability of consumers to pay for power; shortages of or adverse price movements for raw materials; environmental risk, including rehabilitation and resettlement costs; and adverse developments in the overall economic environment in India.

Additionally, an infrastructure asset (either operational or otherwise) may also be exposed to many

risks and hazards which may adversely affect profitability, including:

breakdown, failure or substandard performance of equipment; improper installation or operation of equipment; inability to procure replacement parts for imported equipment in a timely manner; labour disturbances; lack of co-operation of our partners or client; natural disasters; environmental hazards; industrial accidents; and terrorist activity.

Additionally, procurement and construction works carried out in respect of our projects involve a number of hazards including earthquakes, flooding, tsunamis and landslides. Natural disasters may cause significant interruption to our operations, disruption to our properties and damage to the environment that could have a material adverse impact on us. Not all of the above risks may be insurable or possible to insure on commercially reasonable terms. For example, in our port projects the operation of our port handling, comprising handling of bulk cargo, container handling, and other operations may be adversely affected by many factors, such as the breakdown of equipment, damage or loss of cargo, labour disputes, accidents, natural disasters, changes in government regulations, lack of qualified equipment operators and a downturn in the overall performance of the container and shipping industry. We maintain insurance coverage for business interruption arising out of unforeseen physical loss or damage to property with respect to each of our projects, operating roads projects, which we believe is customary for the industries in India in which we operate. Our insurance, however, may not provide adequate coverage in certain circumstances and is subject to certain deductibles, exclusions and limits on coverage. In particular, the insurance policies for our road projects do not cover losses caused by failure to maintain such roads to the agreed upon standards. We have in the past faced disruptions in our project undertaken by our SPV, MNEL which we were not be in a position to control and which also let to the temporary closure of the toll plaza. We cannot assure you that the operation of our infrastructure assets will not be affected by any of the incidents and hazards listed above, or that the terms of our insurance policies will be adequate to cover any damage caused by any such incidents and hazards. Should an uninsured loss or a loss in excess of insured limits occur, we would lose the anticipated revenue from the construction contract and, in the case of our projects, the loss of our investment in the relevant project SPV.

New projects may also pose significant challenges to our management, administrative, financial and operational resources, as we continue to expand across in India. We cannot provide any assurance that we will succeed in any new projects that we may enter into or that we will recover our full investments in such projects. Any failure in the development, financing or operation of any of our new projects may

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adversely affect our business, financial condition and results of operations. 36. Delays in the acquisition of private land and/ or eviction of encroachments from Government-owned

land by the Government may adversely affect the timely performance by our SPVs of their obligations under concession agreements for our Roads Projects or other agreements for our Power Projects; leading to disputes with the Government. Additionally, proposed regulatory changes relating to land acquisition could lead to higher costs and delays in land acquisition in India.

For some of our projects under development or in the pre-development phase, the Central Government or State Governments are required under the relevant concession agreements or implementation agreements to facilitate the acquisition or lease of, or secure rights of way over, tracts of private land and/ or to hand over unencumbered Government land free of encroachments. Delays by Government to acquire or lease or secure rights of way over such private land or in eviction of encroachments on Government land may delay project implementation prescribed by the relevant concession agreement or the implementation agreement and cause consequent construction delays. This may lead to disputes and cross-claims for liquidated damages between our project SPVs and the Government.

All infrastructure projects require substantial tracts of land for the setting up of the projects. The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (the “Land Acquisition Act, 2013”) has come into force with effect from January 1, 2014. However, the rules related to its implementation are yet to be notified. The Land Acquisition Act, 2013, inter alia, stipulates (i) restrictions on land acquisition (e.g. certain types of agricultural land), and (ii) compensation, rehabilitation and resettlement of affected people residing on such acquired land. For example, in relation to our Patna Buxar Toll road Project we have initiated discussions with NHAI for mutual termination of concession agreement on account of non availability of land and certain government approvals. For more details, please refer to “Business” and “Risk Factors” on pages 148 and 51 respectively.

The completion and commercial operation dates of some of our projects are expected to be delayed due to delays in the acquisition or securing of project land. For example, the COD of the Rajahmundry Godavari Toll Road Project has been delayed due to handing over ‘right of way’ over land for toll plaza and delay in finalizing the agreement with NHAI for providing at grade junction on joining NH-16.

Even if we are not penalized for such delays, delays in the acquisition of the land may lead to payment delays or disputes with the Government in connection with a completed project’s eligibility for an early completion bonus. Such delays may have an adverse effect on our revenues, business, financial condition and results of operations.

37. Shares of certain SPVs are pledged or have been agreed to be pledged in favour of lenders, who may

exercise their rights under the respective pledge agreements in the event of default under the respective loan facilities.

Shares of certain SPVs are pledged in favour their respective lenders and/or the lenders of our

Company (as applicable) to secure loan facilities obtained by such companies. For example, 74.89% of the share capital of MNEL; 73.14% of the share capital of VSPL; 67.40% of the share capital of RGBL; 51% of the share capital of REL, ICTPL and GICL; 45.43% of the share capital of AEL; and 26% of the share capital of CBICL, KBICL, and SSRPL, respectively, are pledged or agreed to be pledged in favour of the lenders of these SPVs.

If there are any defaults in payments or any breach under the relevant financing documents, the lenders may exercise their rights under the relevant financing arrangements and take ownership of the pledged shares and thereby take control of such SPVs to the extent of their shareholding. If this happens, we will lose the value of any such pledged shares and we will no longer be able to recognise revenue attributable to these SPVs to such extent. In addition, if we lose control of any of our SPVs, specifically the ones in the operational or development phase, our ability to implement our overall business strategy would be adversely affected.

38. Our partial shareholding in certain SPVs is through beneficial interest and our revenues may be

adversely affected if there is any objection to our beneficial interest.

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The Company holds 100% of legal and beneficial interest in each of AEL, REL and KBICL but approximately holds 74% of the equity share capital of each of these companies. Further, the Company holds 96.53% of the legal and beneficial interest of GICL but holds 69.00% of the equity share capital of GICL. The Company also holds 50% beneficial interest in ICTPL, but 24% of the equity share capital of ICTPL. The Company also holds 51% beneficial interest in THPL, but no equity share capital of THPL. The Company holds the additional beneficial ownership in these companies pursuant to agreements entered into with the respective shareholders, including GIL.

We believe that the above structures are in compliance with the terms of the respective concession agreements with the regulatory authorities, including the NHAI. However, in the event that any regulatory authorities raise objections in relation to the same, we may be required to take corrective steps as we may not be allowed to continue to hold such beneficial ownership interest over these equity shares and therefore, we may not be able to enjoy the rights mentioned above. Since, we currently derive and expect to continue to derive a substantial portion of our revenues from AEL, REL, MNEL, KBICL and GICL, the occurrence of such an event may have an adverse effect on our financial conditions and the results of our operations. Thus, if our consortium partners or the clients, being usually the Government or regulatory authorities, object to such assignment and holding of beneficial interests, we may be required to take corrective steps as we may not be allowed to continue to hold such equity interests. This may have an adverse effect on our financial condition and the results of our operations.

39. The concessions we currently hold to operate some of our road projects may be revoked if we are

unwilling to match offers provided by other highway operators to expand the capacity of these projects. Under the terms of some of our concession agreements entered into with NHAI or other state government, NHAI or such state governments, upon the traffic volume on any such project reaching a pre-established level (determined through a traffic study to be carried out eight years after commencement of commercial operation of the applicable project), may solicit bids for its expansion or modernization. Once NHAI or such state governments has obtained the lowest bid, it will approach us with the terms of such bid (provided that we have submitted a bid for such expansion or modernization), and we may either agree to carry out the work on such terms or have our concession revoked after receiving a termination fee calculated in accordance with our concession agreements. If we are unable or unwilling to compete with other highway operators, we may lose the concessions to operate these road projects, which in turn could adversely affect our business, prospects, financial condition and results of operations.

40. Our road projects that are and shall be based on a toll structure do not have guaranteed revenue

streams and may face competition from existing state highways and future state highways. One of our operational road projects is based on a toll structure. While NHAI has agreed to allow us to collect toll and operate the project exclusively on such stretches of lands, from the commencement date of the relevant concession, we may be subject to competition from highways that have been developed by the relevant state governments, which are not subject to the control of NHAI. Unlike national highways that are built pursuant to concessions granted by NHAI that permit concessionaires to charge users toll payments for the use of such highways, state governments do not typically charge for the use of state highways.

Furthermore, we cannot assure you that the toll collections we receive from our completed road project will be the same amount as the projections that we expected when we originally submitted our bid that could materially and adversely affect our business, prospects, financial condition and results of operations. Although, the clients, for these projects has given an exclusive right to operate the concessions for specified periods from the appointed date; competing highways / alternate roads may be developed, as a result of which our toll roads may face increased competition and a decrease in revenues. We do not have the right to increase tolls that we collect at our road projects and any increase in toll rates is governed by the terms of the respective contracts. We cannot assure you that such increases would be sufficient to meet increased costs associated with such road projects. Any material decrease in the actual traffic volume as compared to our forecasted traffic volume could have a material adverse effect on our cash flows from such projects.

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41. Our power projects have long gestation periods before they become operational and it may take

several years before we realize any benefits or returns on our investments. In addition, the time and costs involved in completing a power project may be subject to substantial increases which could have a material adverse effect on our business, financial condition, cash flows and results of operations. We have power projects at various stages of construction and planning. These under construction and planned plants have long gestation periods, due to the process involved in commissioning power projects. This process typically includes the process of obtaining detailed project reports, applying for and obtaining government approvals, permission for acquiring land, environmental approvals and approvals for the use of water, entering into fuel supply agreements, evacuation agreements, financing agreements, etc. Further, power plants typically require months or even years after being commissioned before cash flows breakeven are achieved. As a result, the probable impact of our under development or planned power projects on our financial performance is difficult to evaluate.

The scheduled completion dates for our projects are estimates and are subject to delays and other risks, including, among other things, contractor performance shortfalls, unforeseen engineering problems, disputes with workers, force majeure events, unanticipated cost increases or changes in scope and delays in obtaining certain property rights, fuel supply and government approvals and consents, any of which could give rise to delays, cost over-runs or the termination of a project’s development and/or a breach of the financial covenants imposed by our lenders. In case of such delays, we may also be required to request certain of our lenders to defer the schedule of repayment in respect of our loans, which may or may not be approved by such lenders. While we may seek to minimize the risk from contractor performance by including liquidated damages, guarantees and warranties in our contracts for delays and sub-standard workmanship and shortfall in performance, we cannot ensure that all potential liabilities are covered or that the damages that may be claimed from such contractors will be adequate to cover any cost over-runs and any loss of profits resulting from such delays, shortfalls and disruptions.

There can be no assurance that these projects will be completed in the time expected, or at all, or that their gestation periods will not be affected by any or all of these or other factors. In addition, failure to complete a project according to its original specifications or on schedule, if at all, may give rise to potential liabilities and could render certain benefits available under various government statutes, such as deduction of 100% of the profits derived from power generation being unavailable, as a result of which our returns on investments may be lower than originally expected. In addition, failure to complete a power project according to its original specifications or schedule, if at all, may give rise to potential liabilities and could render certain benefits available under various government statutes, such as deduction of 100.0% of the profits derived from the power generation being unavailable, as a result, our returns on investments may be lower than originally expected.

Further, the time and costs involved in completing a project may be subject to substantial increases due to various factors including delays in procuring debt financing, shortages of materials, equipment, skilled personnel and labor, adverse weather conditions, natural disasters, labor disputes, disputes with contractors, accidents, changes in government priorities and policies, government inaction or policy paralysis, changes in market conditions, delays in obtaining the requisite licenses, permits and approvals from the relevant authorities and other unforeseeable problems and circumstances, which we have faced in the past. For example, there have been delays in completing Pravara Co-generation Power Project and the Rangit II Hydroelectric Power Project. Also, our estimates of cost and time required to complete a project may not be accurate.

Such estimates are also based on current conditions and may therefore be subject to revisions. Any of these factors may lead to delays in, or prevent the completion of our projects or result in costs exceeding those originally budgeted for, which could have a material adverse effect on our business, financial condition, cash flows and results of operations.

42. Our hydroelectric power projects are located in inhospitable geographical locations, susceptible to

extreme hydrological variation thereby increasing the risks of project implementation and construction delays as well as risks in operating these power plants that may materially and adversely impact our business and results of operations.

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Our hydroelectric power projects under development in India are located in inhospitable geographical locations. Although, geological investigations are being carried out by independent engineers/specialized agencies before the design and engineering of our hydroelectric power projects is finalised, occurrences of adverse geological conditions such as major faults, thrusts or highly stressed rock mass in the future during actual execution cannot be ruled out. Therefore, the conclusions of independent geological investigations are subject to uncertainty. The location of some of these power projects will require us to construct/upgrade access roads and infrastructure in difficult terrain.

Some of these locations are prone to flooding, landslides and other natural disasters. Construction and development of hydroelectric power plants in these locations are therefore inherently risky and time consuming, requiring us to incur additional costs and can involve a significant amount of attention and effort from our management, which could adversely impact our results of operations and business.

The advent of climate change may cause conditions that may result in unusual hydrological variations and extremities. Such hydrological extreme cases may cause damage to the access roads and/or project structures, thereby severely impacting operations and profitability.

43. Our operating results may experience significant variability and as a result it may be difficult for us

to make accurate financial forecasts.

Our operating results may fluctuate significantly from period to period due to various factors, such as customer losses, lack of traffic or parallel access roads, the mix of cargo handled at our port, delays or failure by us or our partners to generate the projected level of business, variations in our operating efficiency and manpower, delays or difficulties in expanding our operations at our business, changes to our pricing structure or that of our competitors, seasonal changes and other fluctuations in the operations of our customers and any other events identified under “Forward-Looking Statements” on page 11.

In addition, the timing and speed of commencement of revenue-generating operations from our projects and capital expenditures, such as the expansion of our cargo handling capacity or the addition of other services, may vary considerably from our expectations based upon the size and complexity of the project being implemented. These factors may make it difficult to make accurate financial forecasts or replace anticipated income that we do not receive as a result of delays in implementing our services or due to losses of customers. If our actual results do not meet estimates or expectations, or if we under-perform market expectations as a result of such factors, trading prices for our Equity Shares could be adversely affected.

44. Tariff regulations for power projects are subject to regulatory scrutiny and are determined based on

policies formulated by the Government and/or the relevant regulatory authority and may adversely affect our revenues and results from operations.

In relation to our power business, the Government has notified the national power tariff policy (“Tariff Policy”) that deals with various parameters with respect to the fixation of power tariffs, such providing adequate return on investment to the power generator and supplier and ensuring reasonable user charges for the consumers. The Tariff Policy provides uniform guidelines to the state electricity regulatory commissions for the fixation of tariffs for their respective entities as well as the CERC. These guidelines include a detailed methodology for the different components of the tariff and also lay down the parameters for what types of charges are scalable and non-scalable. Once the tariff for a power project under construction or an operating power plant has been approved by the state electricity regulatory commission or the CERC, any changes or revisions to the tariff due to factors such as cost overruns or delays in the project implementation can only be revised by filing a petition to review the tariff with the appropriate state electricity regulatory commission or the CERC. We cannot assure you that we will be successful in obtaining timely tariff revisions due to delays and cost over-runs in our power projects.

45. We may not be selected for any of the projects for which we have submitted a bid.

There are certain proposed projects for which we have submitted financial bids or we have been qualified to submit a financial bid. We generally incur significant costs in the preparation and

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submission of bids, which are one time costs. We cannot assure you that we would bid where we have been qualified to submit a financial bid or that our financial bids, when submitted or if already submitted, would be accepted. Further, there may be delays in the bid selection process owing to a variety of reasons which may be outside our control and our bids, once selected, may not be finalised within the expected time frame. As a result, our results of operations from period to period may not be comparable.

46. Our success depends on our senior management and our ability to attract and retain our key

personnel.

Our success depends on the continued services and performance of the members of our management team, other key employees and also depends upon our ability to attract and retain a large group of experienced professionals and staff. If one or more members of our senior management team were unable or unwilling to continue in their present positions, or if we are unable to recruit, train or retain a sufficient number of experienced personnel, our business could be adversely affected. Competition for senior management in the infrastructure development industry in India is intense, and we may not be able to retain our existing senior management or attract and retain new senior management in the future. Additionally, our ability to retain experienced staff members as well as senior management will in part depend on us having in place appropriate staff remuneration and incentive schemes. We cannot be sure that the remuneration and incentive schemes we have in place will be sufficient to retain the services of our senior management and skilled employees. As such, any loss of our senior management personnel or key employees could adversely affect our business, results of operations and financial condition.

47. Except with respect to our operation and maintenance business, project advisory and management

services, the only material sources of cash for our Company are and are expected to be dividends, distributions and payments under shareholder loans (if any) from our Subsidiaries and our Joint Ventures.

Our Company is also involved in the operation and maintenance business. Whilst our operations and maintenance business are subject to a number of risks that impact margins, the only significant asset of our Company is the shares that we hold in our Subsidiaries and our Joint Ventures. Owing to the nature of our business that we operate in, our Company conducts virtually all of our business operations through our Subsidiaries and our Joint Ventures (other than our operations and maintenance and other services). Accordingly, the primary sources of cash for our Company are dividends, distributions and payments with respect to our ownership interests in, or shareholder loans that our Company may make to, our Subsidiaries and our Joint Ventures that are derived from the earnings and cash flow generated by our operating companies. Our Subsidiaries and Joint Ventures might not generate sufficient earnings and cash flow to pay dividends, distributions or payments under shareholder loans in the future. In addition, our Subsidiaries’, Joint Ventures’ debt instruments and other agreements limit or prohibit, or are expected to limit or prohibit, certain payments of dividends, other distributions or payments under shareholders’ loans to us.

The ability of our Subsidiaries and Joint Ventures to make payments to us depends largely on their respective financial condition and ability to generate profits as well as current and future prevailing regulatory conditions. In addition, because our Subsidiaries and Joint Ventures are separate and distinct legal entities, they will have no obligation to pay any dividends and may be restricted from doing so by contract, including other financing arrangements, their charter documents, other shareholders or partners or the applicable laws and regulations of the jurisdictions in which they operate.

48. Our business is significantly dependent on Government of India’s focus on infrastructure

development and expenditure levels in the infrastructure sector. Our business is dependent on projects undertaken and funded by governmental authorities and/or by

international and multilateral development finance institutions in sectors including power, irrigation and water supply, transportation projects and mass housing projects, which are traditionally the domain of entities directly or indirectly owned or controlled by either the central or State Governments. Any change in the Government’s focus or the policy framework regarding infrastructure development may adversely affect our business and results of operations. Our performance in specific segments, for example, undertaking BOT or BOOT infrastructure projects, requires public-private participation.

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Investment by the private sector in such projects is dependent on potential returns and is therefore linked to Government policies relating to public-private participation and sharing of risks and returns from such projects. A reduction of capital investment in or a change in Government support and promotion for the infrastructure sector could have a material adverse impact on our business and results of operations.

49. Demand for infrastructure services in India depends on domestic and regional economic growth.

The infrastructure development business is dependent on the level of domestic, regional and global economic growth, international trade and consumer spending. The rate of growth of India’s economy and of the demand for infrastructure services in India may fluctuate over the years. During periods of strong economic growth, demand for such services may grow at a rate equal to, or even greater than, that of the GDP. Conversely, during periods of slow GDP growth, such demand may exhibit slow or even negative growth. Economic developments outside India have adversely affected the Indian markets. Since the second half of 2007, the global credit markets have experienced, and may continue to experience, significant volatility which have originated from the adverse developments in the United States and the European Union credit and sub-prime residential mortgage markets. These and other related events, such as the collapse of a number of financial institutions, have had and continue to have, a significant adverse effect on the availability of credit, the confidence of the financial markets and investment outlook, globally as well as in India. In light of such events, the infrastructure industry in India may experience a slowdown. In addition, markets have been very volatile in recent months, and the resulting economic turmoil may continue to exacerbate industry conditions or have other unforeseen consequences, leading to uncertainty about future conditions in the infrastructure industry. We cannot assure you that Government responses to the disruptions in the financial markets will restore consumer confidence, stabilize the markets or increase liquidity and the availability of credit. There can be no assurance that future fluctuations in economic or business cycles, or other events that could influence GDP growth, will not have an adverse effect on our business and results of operations.

50. Compliance with, and changes in, safety, health and environmental laws and regulations may

adversely affect our business, financial condition and results of operations.

Our business operations are subject to various Indian national and state environmental laws and regulations relating to the control of pollution in the various locations in India where we operate. In particular, the discharge or emission of chemicals, dust or other pollutants into the air, soil or water that exceed permitted levels and cause damage to others may give rise to liability to the Government and third parties, and may result in our Group incurring costs to remedy such discharge or emissions. There can be no assurance that compliance with such environmental laws and regulations will not result in a material increase in the costs or not have a material adverse effect on the financial condition and results of operations of our Group. Our business operations can cause severe damage to the environment, property and person and may subject us to potential legal liabilities, which could materially and adversely affect our business, reputation, financial condition, cash flows and results of operations. Generation of hydroelectric power often requires the use of diversion structures such as dams and barrages, which can materially affect the flow of rivers, alter ecosystems and affecting the wildlife and people who depend on those waters. Environmental laws and regulations in India have been increasing in stringency and it is possible that they will become significantly more stringent in the future. For example, we are subject to environmental laws and regulations including the Environmental Protection Act 1986, the Air (Prevention and Control of Pollution) Act 1981, the Water (Prevention and Control of Pollution) Act 1974 and other regulations promulgated by the Ministry of Environment and the pollution control boards of the relevant states. In addition, some of our operations are subject to risks involving personal injury, loss of life, environmental damage and severe damage to property.

Our business operations can cause severe damage to the environment, property and person and may subject us to potential legal liabilities, which could materially and adversely affect our business, reputation, financial condition, cash flows and results of operations. The scope and extent of new environmental regulations, including their effect on our operations, cannot be predicted with certainty. The costs and management time required to comply with these requirements could be significant. The measures we implement in order to comply with these new laws and regulations may not be deemed sufficient by Governmental authorities and our compliance costs may significantly exceed our estimates. If we fail to meet environmental requirements, we may also be subject to administrative, civil and criminal proceedings by Governmental authorities, as well as civil proceedings by

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environmental groups and other individuals, which could result in substantial fines and penalties against us as well as orders that could limit or halt our operations.

Our failure to comply with any or all applicable government regulations, or a change in any or all such regulations, may disrupt our operations and could have a material adverse effect on our business, financial condition, results of operations and cash flows. Stricter laws and regulations, or stricter interpretation of the existing laws and regulations, may impose new liabilities on our Group or result in the need for additional investment in pollution control equipment, either of which could adversely affect the business, financial condition or prospects of our Group.

51. Changes in technology may render our current technologies obsolete or require us to make

substantial capital investments.

Although we attempt to maintain the latest international technology standards, the technology requirements for businesses in the infrastructure sector are subject to continuing change and development. Some of our existing technologies and processes may become obsolete, performing less efficiently compared to newer and better technologies and processes in the future. The cost of upgrading or implementing new technologies, upgrading our existing equipment or expanding our capacity could be significant and could adversely affect our results of operations.

52. Our Promoter and Promoter Group will have the ability to determine the outcome of any

shareholder resolution.

As on June 30, 2014, our Promoter along with our Promoter Group held 74.98% of our equity share capital. Upon the completion of the Issue, the shareholding of our Promoter shall stand diluted however they shall continue to be our largest shareholder. As a result, our Promoter and Promoter Group will continue to exercise significant control over us, including being able to determine decisions. The interests of our Promoter and Promoter Group as our controlling shareholder could conflict with our interests or the interests of our other shareholders. As a result, our Promoter and Promoter Group may take actions with respect to our business that may conflict with our interests and the interests of our other investors. See risk factor titled “Our Promoter has recently undergone a corporate debt restructuring” on page 50.

53. We have entered into, and will enter into, related party transactions.

As of December 31, 2013, we have entered into several related party transactions with our Promoters and Subsidiaries relating to operations and maintenance aspects of our projects, inter corporate loans, rental income, furnishing of guarantees etc. For further details please refer to “Related Party Transactions” on page 168.

We are involved in, and we expect that we will continue to be involved in, a significant number of

related party transactions. There can be no assurance that we will receive favourable terms in our related party transactions. Also, under the Income Tax Act, 1961, there are guidelines on the domestic transfer pricing in relation to the related party transactions. We have had and expect to have a substantial amount of ongoing transactions with our Promoter group companies and other group entities. Although, we ensure that our related party transactions are done at an arm’s length and in accordance with the applicable laws, however, we cannot assure you that we can comply with all the legal requirements in relation to our related party transactions.

54. We do not own the “Gammon” trademark, including the name and logo, and our use of the

“Gammon” trademark, along with the value of such intellectual property, may be impaired by the actions of others.

The trademark (including the name and logo) “Gammon” is an important asset of our business. However, we do not own the “Gammon” trademark, and our use of the “Gammon” name and logo is by virtue of a trademark license agreement with GIL. We have the right to use the trademark “Gammon” until March 19, 2017. Under the terms of this agreement, we are required to make an annual payment of ₹ 100 to GIL as consideration for the license. Maintaining and enhancing the reputation associated with the “Gammon” trademark is integral to our business. Infringement of the “Gammon” trademark, for which we may not have recourse, may adversely and materially affect our

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reputation, and, thereby, our business and results of operations. In addition, any adverse development concerning the infrastructure or other businesses of GIL, for example any construction accidents involving projects undertaken by GIL, may have an adverse effect on the “Gammon” brand.

55. Our Company has given guarantees in relation to certain debt facilities provided to our Subsidiaries,

Joint Ventures and associates, which, if called upon, may materially and adversely affect our business, results of operations, financial condition and cash flows.

Our Company has given corporate guarantees in relation to certain liabilities including debt facilities availed by our Subsidiaries aggregating to ₹ 17,950.90 lakhs as of June 30, 2014. Guarantees of indebtedness of our Subsidiaries, Joint Ventures and associates are recognized in our Financial Statements as contingent liabilities (as per ‘Accounting Standards 29 – Provisions, Contingent Liabilities and Contingent Assets’). We intend to contest the matter in an appropriate forum. In the event these guarantees are enforced, our business, prospects, results of operations and financial condition may be adversely affected. Additionally, in the event that any of the guarantees provided by us is revoked, the lenders for such facilities may require alternate guarantees, repayment of amounts outstanding under such facilities, or even terminate such facilities. We may not be successful in procuring guarantees satisfactory to the lenders, and as a result may need to repay outstanding amounts under such facilities or seek additional sources of capital, which could affect our business, prospects, results of operations, financial condition and cash flows.

56. We have a number of contingent liabilities and our profitability could be adversely affected if any of

these contingent liabilities materialises.

The contingent liabilities (as per ‘Accounting Standards 29 – Provisions, Contingent Liabilities and Contingent Assets’) disclosed in the Unaudited Consolidated Interim Condensed Financial Statements for the 6 months period ended on June 30, 2014 was ₹ 49,250.84 lakhs. If any of these contingent liabilities (as per ‘Accounting Standards 29 – Provisions, Contingent Liabilities and Contingent Assets’) materialises, our profitability may be adversely affected. For a more detailed description of our contingent liabilities (as per ‘Accounting Standards 29 – Provisions, Contingent Liabilities and Contingent Assets’), see the section“Contingent Liabilities” on page 111. These consisted of the following:

(₹ in lakhs)

Income-tax matters

Disputed statutory liabilities

Claims not acknowledged

Counter guarantees given to bankers Total

Total 7,651.56 1,777.00 1,380.51 38,441.77 49,250.84 57. We may, as part of our efforts to raise funds, sell or pledge interests in one or more of our

Subsidiaries and/or Joint Ventures.

As part of our funding exercises we may sell or pledge all or part of our interests in one or more of our Subsidiaries and/or Joint Ventures through a listing of the shares of such Subsidiaries and/or Joint Ventures or the sale or pledge to third parties of all or a portion of our shares in such Subsidiaries and/or Joint Ventures (current and future). We may in the future explore options of selling stakes in our Roads Projects. Following any such sale or enforcement of pledge of all or part of our interest in such Subsidiaries and/or Joint Ventures, our equity or beneficial interest in the assets held by such Subsidiaries and/or Joint Ventures would be reduced by a corresponding amount. Although we may receive the proceeds of any sale of shares or the benefits of any pledge of shares in a Subsidiary and/or Joint Venture, there can be no assurance that such proceeds or the benefits of any pledge of shares will accurately reflect the value of such Subsidiary and/or Joint Venture to our business or that our share price will not fall as a result of such sale or pledge of shares. Furthermore, there can be no assurance that the proceeds of any sale of shares in a Subsidiary and/or Joint Venture will be reinvested in our business and that the benefits of such proceeds will accrue to the shareholders of our Company to the extent of the benefits generated by the sold or pledged shares or at all.

58. We cannot guarantee the accuracy of statistical and other information with respect to India, the

Indian economy or our business or the industries in which we operate contained in this Placement Document.

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Some data relating to our business have been assessed and quantified internally by our Company or our Subsidiaries as no other credible third party sources are available for such data. The assessment of the data is based on our understanding, experience and internal estimates of our business. Although we believe that the data can be considered to be reliable, their accuracy, completeness and underlying assumptions are not guaranteed and their dependability cannot be assured.

Statistical and other information in this Placement Document relating to India, the Indian economy or the industries in which we operate have been derived from various government publications and obtained in communications with various Indian government agencies that we believe to be reliable. However, we cannot guarantee the quality or reliability of such source of materials as this information have not been prepared or independently verified by us. While our directors have taken reasonable care in the reproduction of the information, the information has not been independently verified by us, each of the Book Running Lead Managers or any of our or their respective affiliates or advisors and, therefore, we make no representation as to the accuracy of such facts and statistics, which may not be consistent with other information compiled within or outside India. These facts and other statistics include the facts and statistics included in the section titled “Industry Overview” of this Placement Document. Due to possibly flawed or ineffective collection methods or discrepancies between published information and market practice and other problems, the statistics herein may be inaccurate or may not be comparable to statistics produced for other economies and should not be unduly relied upon. Further, there is no assurance that they are stated or compiled on the same basis or with the same degree of accuracy as may be the case elsewhere. In all cases, investors should give consideration as to how much weight or importance they should attach to, or place on, such facts or statistics.

59. We have no experience in implementing projects outside of India.

We have no experience in implementing projects outside India as we have not invested and undertaken any business overseas in the past. However, we continue to explore business opportunities for developing projects outside India in the future, mainly in developing economies such as Africa and certain Asian countries. We will be subject to business risks and uncertainties associated with the political, economic and industrial sectors in the countries where we are exploring such opportunities. In the event that we are required to invest substantial resources in these projects and the revenues generated are not commensurate with such investments, our results of operations may be adversely affected.

60. We have recently changed our Financial Year Our Financial Statements for the last three Financial Years may not be comparable due to the change in

the Financial Year after March 31, 2013. Our current Financial Year is for the period from January 1 to December 31 and the Financial Statements for the nine month period ended December 31, 2013 is only for a period of 9 months. The nine month period ended December 31, 2013, which is a nine month period may not be comparable to the 12 months period Financial Year ending on March 31, 2013.

We have generally in the past published only the unaudited quarterly consolidated Financial Statements which have not been reviewed and therefore there maybe changes in the financials upon their subsequent audit.

61. We have been inconsistent in maintaining certain documents.

We are unable to trace copies of some of the letter of credits for one of our operating road project and the trade mark license renewal letter which we executed with GIL in the past. While we believe that these documents have been duly issued and executed, we have not been able to trace copies of these documents. We cannot assure you that we will manage to obtain duplicate copies of the letter of credit from the banks, which may affect our ability to enforce the terms of the letter of credit.

62. Capital advances towards land acquisition by our group companies/SPVs

We have made some payments as capital advance towards acquisition of land. The acquisition of land

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was cancelled pursuant to cancellation agreements and the balance amount of ₹4,292.48 lakhs is receivable over a period upto March 2015. We cannot assure that these balance receivables will be recovered by us.

63. Third-party statistical and financial data in this Placement Document may be incomplete or unreliable.

Statistical and industry data used throughout this Placement Document has been obtained from various government and industry publications. We believe the information contained therein has been obtained from sources that are reliable, but we have not independently verified the data in the Placement Document that comes from industry publications and other third party sources, and the accuracy and completeness of the information is not guaranteed and its reliability cannot be assured. Further, this market and industry data has not been prepared or independently verified by us or the Book Running Lead Managers or any of their respective affiliates or advisors. Such data involves risks, uncertainties and numerous assumptions and is subject to change based on various factors. Accordingly, investment decisions should not be based on such information.

64. Our inability to manage growth could disrupt our business and reduce our profitability.

A principal component of our strategy is to continue to grow by expanding the size and geographical scope of our existing businesses as well as the development of new infrastructure-related businesses. This growth strategy will place significant demands on our management, financial and other resources. It will require us to continuously develop and improve our operational, financial and internal controls. Continuous expansion increases the challenges involved in financial management, recruitment, training and retaining high quality human resources, preserving our culture, values and entrepreneurial environment, and developing and improving our internal administrative infrastructure.

In addition, we may in the future, consider, making strategic acquisitions of other infrastructure companies whose resources, capabilities and strategies are complementary to and are likely to enhance our business operations. If we acquire another company we could face difficulties integrating the acquired operations. These difficulties could disrupt our ongoing business, distract our management and employees and increase our expenses.

An inability to manage such growth could disrupt our business prospects, impact our financial condition and adversely affect our results of operations.

Risks related to investment in Indian companies 65. The Companies Act, 2013 has effected significant changes to the existing Indian company law

framework, which may subject us to higher compliance requirements and increase our compliance costs.

A majority of the provisions and rules under the Companies Act, 2013 have recently been notified and have come into effect from the date of their respective notification, resulting in the corresponding provisions of the Companies Act, 1956 ceasing to have effect. The Companies Act, 2013 has brought into effect significant changes to the Indian company law framework, such as in the provisions related to issue of capital (including provisions in relation to issue of securities on a private placement basis), disclosures in offer document, corporate governance norms, accounting policies and audit matters, related party transactions, introduction of a provision allowing the initiation of class action suits in India against companies by shareholders or depositors, a restriction on investment by an Indian company through more than two layers of subsidiary investment companies (subject to certain permitted exceptions), prohibitions on loans to directors and insider trading and restrictions on directors and key managerial personnel from engaging in forward dealing. We are also required to spend, in each Financial Year, at least 2% of our average net profits during three immediately preceding Financial Years towards corporate social responsibility activities. Further, the Companies Act, 2013 imposes greater monetary and other liability on our Company and Directors for any non-compliance. To ensure compliance with the requirements of the Companies Act, 2013, we may need to allocate additional resources, which may increase our regulatory compliance costs and divert management attention.

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The Companies Act, 2013 introduced certain additional requirements which do not have corresponding equivalents under the Companies Act, 1956. Accordingly, we may face challenges in interpreting and complying with such provisions due to limited jurisprudence on them. In the event, our interpretation of such provisions of the Companies Act, 2013 differs from, or contradicts with, any judicial pronouncements or clarifications issued by the Government in the future, we may face regulatory actions or we may be required to undertake remedial steps. Additionally, some of the provisions of the Companies Act, 2013 overlap with other existing laws and regulations (such as the corporate governance norms and insider trading regulations issued by SEBI). Recently, SEBI issued revised corporate governance guidelines that are effective from October 1, 2014. Pursuant to the revised guidelines, we will be required to, amongst other things ensure that there is at least one woman director on our Board at all times, establish a vigilance mechanism for directors and employees and reconstitute certain committees in accordance with the revised guidelines. We may face difficulties in complying with any such overlapping requirements. Further, we cannot currently determine the impact of provisions of the Companies Act, 2013 and the revised SEBI corporate governance guidelines, which are yet to come in force. Any increase in our compliance requirements or in our compliance costs may have an adverse effect on our business and results of operations.

66. Political instability could adversely affect economic conditions in India and consequently our

business.

We are incorporated in India and derive all our revenues from India and substantially all of our assets are located in India. Further, our business is also impacted by regulations and conditions in the various states in India where we operate. Consequently, our performance and the market price and liquidity of the Equity Shares may be affected by changes in exchange rates and controls, interest rates, Government policies, taxation, social and ethnic instability and other political and economic developments affecting India. In recent years, India has been following a course of economic liberalisation and our business could be significantly influenced by economic policies followed by the Government. However, we cannot assure you that such policies will continue in the future. Government corruption, scandals and protests against certain economic reforms, which have occurred in the past, could slow the pace of liberalisation and deregulation. The rate of economic liberalisation could change, and specific laws and policies affecting foreign investment, currency exchange rates and other matters affecting investment in India could change as well. A significant change in India’s economic liberalisation and deregulation policies, in particular those relating to the businesses in which we operate, could disrupt business and economic conditions in India generally and our businesses in particular.

67. Public companies in India, including our Company, may be required to prepare financial statements

under IFRS or a variation thereof, Indian Accounting Standards “IND AS”. The transition to IND AS in India is still unclear and we may be adversely affected by this transition. We currently prepare our annual and interim financial statements under Indian GAAP. Public companies in India, including us, may be required to prepare annual and interim financial statements under Indian Accounting Standard 101 “First-time Adoption of Indian Accounting Standards (“IndAS”). The Institute of Chartered Accountants of India (“ICAI”) recently published a near final version of IndAS. On February 25, 2011, the Ministry of Corporate Affairs (“MCA”) of the Government announced that IndAS will be implemented in a phased manner and the date of such implementation will be notified at a later date. As of the date of this Placement Document, the MCA has not yet notified the date of implementation of Ind AS. There is not yet a significant body of established practice on which to draw in forming judgments regarding its implementation and application. Additionally, IndAS differs in certain respects from International Financial Reporting Standard (“IFRS”) and therefore financial statements prepared under IndAS may be substantially different from financial statements prepared under IFRS. There can be no assurance that our financial condition, results of operations, cash flow or changes in shareholders’ equity will not be present differently under IndAS than under Indian GAAP or IFRS. As we adopt IndAS reporting, we may encounter difficulties in the ongoing process of implementing and enhancing its management information systems. There can be no assurance that the adoption of IndAS by us will not adversely affect our results of operations or financial condition and any failure to successfully adopt IndAS in accordance with the prescribed timelines may have an adverse effect on our financial position and results of operations.

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68. A downgrade of our Company or of our Subsidiaries’ or India’s sovereign debt rating may adversely

affect our ability to raise additional debt financing.

Any adverse revisions to our or our Subsidiaries’ or India’s sovereign credit ratings for domestic and international debt by rating agencies may adversely affect our ability to raise additional financing and the interest rates and other commercial terms at which such additional financing is available. This could have an adverse effect on our business and future financial performance and our ability to obtain financing to fund our growth, as well as on the trading price of the Equity Shares.

69. Our ability to raise foreign capital may be constrained by Indian law.

As an Indian company, we are subject to exchange controls that regulate borrowing in foreign currencies. Such regulatory restrictions limit our financing sources for our operations and could constrain our ability to obtain financing on favourable terms and refinance existing indebtedness. In addition, we cannot assure you that required approvals will be granted to us without onerous conditions, or at all. Limitations on foreign debt may have an adverse effect on our business, financial condition and results of operations.

70. The Competition Act, 2002, regulates our business and activities and any adverse application or

interpretation of the Competition Act could materially and adversely affect our business, financial condition and results of operations.

The Competition Act, 2002, of India, as amended (“Competition Act”) regulates practices having an appreciable adverse effect on competition (“AAEC”) in the relevant market in India. Under the Competition Act, any formal or informal arrangement, understanding or action in concert, which causes or is likely to cause an AAEC is considered void and results in the imposition of substantial penalties. Further, any agreement among competitors which directly or indirectly involves the determination of purchase or sale prices, limits or controls production, shares the market by way of geographical area or number of guests in the relevant market or directly or indirectly results in bid- rigging or collusive bidding is presumed to have an AAEC in the relevant market in India and is considered void. The Competition Act also prohibits abuse of a dominant position by any enterprise.

On March 4, 2011, the Government issued and brought into force the combination regulation (merger control) provisions under the Competition Act with effect from June 1, 2011. These provisions require acquisitions of shares, voting rights, assets or control or mergers or amalgamations that cross the prescribed asset and turnover based thresholds to be mandatorily notified to and pre-approved by the Competition Commission of India (the “CCI”). Additionally, on May 11, 2011, the CCI issued Competition Commission of India (Procedure for Transaction of Business Relating to Combinations) Regulations, 2011, as amended, which sets out the mechanism for implementation of the merger control regime in India.

The Competition Act aims to, among others, prohibit all agreements and transactions which may have an AAEC in India. Consequently, all agreements entered into by us could be within the purview of the Competition Act. Further, the CCI has extra-territorial powers and can investigate any agreements, abusive conduct or combination occurring outside India if such agreement, conduct or combination has an AAEC in India. However, the impact of the provisions of the Competition Act on the agreements entered into by us cannot be predicted with certainty at this stage. We are not currently party to any outstanding proceedings, nor have we received notice in relation to non-compliance with the Competition Act or the agreements entered into by us. However, if we are affected, directly or indirectly, by the application or interpretation of any provision of the Competition Act, or any enforcement proceedings initiated by the CCI, or any adverse publicity that may be generated due to scrutiny or prosecution by the CCI or if any prohibition or substantial penalties are levied under the Competition Act, it would adversely affect our business, results of operations and prospects.

71. Natural disasters, terrorist attacks, civil unrest, war or conflicts, especially those involving India,

could adversely affect the financial markets and adversely affect our business.

India has in the past experienced natural disasters, such as tsunamis, floods, cyclones and earthquakes. If any of our project sites were to be damaged by a natural disaster, our business operations could be

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interrupted or delayed, which could adversely affect our business, financial condition and results of operations.

India has also from time to time experienced instances of social, religious and civil unrest and terrorist attacks. Military activity or terrorist attacks in the future could influence the Indian economy by disrupting communications and making travel more difficult and such political tensions could create a greater perception that investments in Indian companies involve higher degrees of risk. Events of this nature in the future, as well as social and civil unrest within other countries in Asia, could influence the Indian economy and our business, future financial performance, cash flows and market price of the Equity Shares.

72. Investors may not be able to enforce a judgment of a foreign court against our Company.

Our Company is a limited liability company incorporated under the laws of India. All of our Company’s Directors are residents of India and the assets of our Group are located in India. The senior management employed by our Subsidiaries are residents of India. As a result, it may not be possible for investors to effect service of process upon our Company or such persons in jurisdictions outside India, or to enforce against them judgments obtained in courts outside India. Moreover, it is unlikely that a court in India would award damages on the same basis as a foreign court if an action were brought in India or that an Indian court would enforce foreign judgments if it viewed the amount of damages as excessive or inconsistent with Indian public policy. For details see the section “Enforcement of Civil Liabilities” on page 12.

73. Your ability to acquire and sell Equity Shares is restricted by the distribution and transfer restrictions set forth in this Placement Document and may be subject to delays if any other Government agency’s approval is required.

No actions have been taken to permit a public offering of the Equity Shares in any jurisdiction including India. The Equity Shares are subject to restrictions on transferability and resale. You are required to inform yourself about and observe these restrictions, which are set forth in this Placement Document under the section “Transfer Restrictions”. The information contained in this Placement Document has been provided for the benefit of investors. However, the information below does not purport to be a complete analysis of the restrictions under Indian laws for the acquisition and/or transfer of securities in an Indian company by a person resident outside India. The Company, the Book Running Lead Managers and their respective officers, directors, representatives, agents, affiliates and associates accept no responsibility or liability for advising any investor on whether such investor is eligible to acquire Equity Shares of the Company. We, our representatives and our agents will not be obligated to recognise any acquisition, transfer or resale of the Equity Shares made other than in compliance with the restrictions set forth herein.

74. You may be restricted in your ability to exercise pre-emptive rights under Indian law and thereby may suffer future dilution of your ownership position. Under the Companies Act, and the Listing Agreements, a public limited company incorporated in India must offer its holders of equity shares pre-emptive rights to subscribe and pay for a proportionate number of shares to maintain their existing ownership percentages before the issuance of any new equity shares, unless the pre-emptive rights have been waived by adoption of a special resolution by the holders of three-fourths of the shares that are voted on the resolution, or if no such resolution is adopted, the resolution is adopted by a simple majority of the shareholders that voted on the resolution and the Central Government is satisfied on an application made by the board of directors that such approval is beneficial to the company. However, if the law of the jurisdiction you are in does not permit you to exercise your pre-emptive rights without us filing an offering document or registration statement with the applicable authority in the jurisdiction that you are in or otherwise taking steps to comply with local securities or other laws, you will be unable to exercise your pre-emptive rights unless we make such a filing or take such other steps. If we elect not to make such a filing, the new securities may be issued to a custodian, who may sell the securities for your benefit. The value, if any, such custodian would receive upon the sale of such securities and the related transaction costs cannot be predicted. In addition, to the extent that you do not or are unable to exercise pre-emptive rights granted in respect of the Equity Shares held by you, your proportional interest in the Company would be reduced.

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Risks related to the Equity Shares and the trading market 75. The trading price of the Equity Shares may be subject to volatility and you may not be able to sell the

Equity Shares at or above the Issue Price. The trading price of the Equity Shares may fluctuate after this Issue due to a variety of factors, including our results of operations and the performance of our business, competitive conditions, general economic, political and social factors, the performance of the Indian and global economy and significant developments in India’s fiscal regime, volatility in the Indian and global securities market, performance of our competitors and the perception in the market about investments in the infrastructure sector, changes in the estimates of our performance or recommendations by financial analysts and announcements by us or others regarding contracts, acquisitions, strategic partnerships, joint ventures, or capital commitments. In addition, if the stock markets in general experience a loss of investor confidence, the trading price of the Equity Shares could decline for reasons unrelated to our business, financial condition or operating results. The trading price of the Equity Shares might also decline in reaction to events that affect other companies in our industry even if these events do not directly affect us. Each of these factors, among others, could adversely affect the price of the Equity Shares.

76. There is no guarantee that the Equity Shares will be listed on the Stock Exchanges in a timely

manner or at all, and any trading closures at the Stock Exchanges may adversely affect the trading price of our Equity Shares.

In accordance with Indian law and practice, permission for listing and trading of the Equity Shares issued pursuant to the Issue will not be granted until after the Equity Shares have been issued and allotted. Approval for listing and trading will require all relevant documents authorising the issuing of Equity Shares to be submitted. There could be a failure or delay in listing the Equity Shares on the Stock Exchanges. Any failure or delay in obtaining the approval would restrict your ability to dispose of your Equity Shares.

77. Our ability to pay dividends in the future will depend upon our future earnings, financial condition,

cash flows, working capital requirements, capital expenditures and other factors.

The amount of our future dividend payments, if any, will depend upon our future earnings, financial condition, cash flows, working capital requirements, capital expenditures and other factors. There can be no assurance that we will have distributable funds in future periods.

78. There are restrictions on daily movements in the trading price of the Equity Shares, which may

adversely affect a shareholder’s ability to sell the Equity Shares or the price at which Equity Shares can be sold at a particular point in time.

The Equity Shares are subject to a daily circuit breaker imposed on listed companies by all stock exchanges in India, which does not allow transactions beyond certain volatility in the trading price of the Equity Shares. This circuit breaker operates independently of the index-based market-wide circuit breakers generally imposed by SEBI on the Stock Exchanges. The percentage limit on the Equity Shares’ circuit breaker will be set by the stock exchanges based on historical volatility in the price and trading volume of the Equity Shares. The stock exchanges are not required to inform us of the percentage limit of the circuit breaker, and they may change the limit without our knowledge. This circuit breaker would effectively limit the upward and downward movements in the trading price of the Equity Shares. As a result of this circuit breaker, there can be no assurance regarding the ability of shareholders to sell the Equity Shares or the price at which shareholders may be able to sell their Equity Shares.

79. The price of the Equity Shares may be volatile.

The trading price of the Equity Shares may fluctuate after the Issue due to a variety of factors, including our results of operations and the performance of our business, competitive conditions, general economic, political and social factors, currency exchange rate fluctuations, performance of the Indian and global economy and significant developments in India’s fiscal regime, volatility in the Indian and global securities market, performance of our competitors, the Indian infrastructure industry

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and the perception in the market about investments in the infrastructure industry, changes in the estimates of our performance or recommendations by financial analysts and announcements by us or others regarding contracts, acquisitions, strategic partnerships, joint ventures, or capital commitments. In addition, if the stock markets experience a loss of investor confidence, the trading price of the Equity Shares could decline for reasons unrelated to our business, financial condition or operating results. The trading price of the Equity Shares might also decline in reaction to events that affect other companies in our industry even if these events do not directly affect us. Each of these factors, among others, could adversely affect the price of the Equity Shares.

80. Foreign investors are subject to foreign investment restrictions under Indian law that limit our

ability to attract foreign investors, which may adversely affect the trading price of the Equity Shares.

Under the foreign exchange regulations currently in force in India, transfers of shares between non-residents and residents are freely permitted (subject to certain exceptions) if they comply with the requirements specified by the RBI. If the transfer of shares is not in compliance with such requirements or falls under any of the specified exceptions, then prior approval of the RBI or the FIPB will be required. In addition, shareholders who seek to convert the Rupee proceeds from a sale of shares in India into foreign currency and repatriate that foreign currency from India will require a no-objection or tax clearance certificate from the income tax authority. Additionally, the Indian government may impose foreign exchange restrictions in certain emergency situations, including situations where there are sudden fluctuations in interest rates or exchange rates, where the Indian government experiences extreme difficulty in stabilizing the balance of payments or where there are substantial disturbances in the financial and capital markets in India. These restrictions may require foreign investors to obtain the Indian government’s approval before acquiring Indian securities or repatriating the interest or dividends from those securities or the proceeds from the sale of those securities. There can be no assurance that any approval required from the RBI or any other government agency can be obtained on any particular terms or at all.

81. An investor will not be able to sell any of the Equity Shares purchased in the Issue other than on a

recognized Indian stock exchange for a period of 12 months from the date of issue of such Equity Shares.

Pursuant to the SEBI Regulations, for a period of 12 months from the date of the issue of the Equity Shares in the Issue, investors purchasing the Equity Shares in the Issue may only sell their Equity Shares on the NSE or the BSE and may not enter into any off-market trading in respect of their Equity Shares. We cannot be certain that these restrictions will not have an impact on the price of the Equity Shares.

82. You may be subject to Indian taxes arising out of capital gains on the sale of the Equity Shares.

Under current Indian tax laws and regulations, capital gains arising from the sale of equity shares in an Indian company are generally taxable in India. Any gain realized on the sale of shares on a stock exchange held for more than 12 months will not be subject to capital gains tax in India if the securities transaction tax (“STT”) has been paid on the transaction. The STT will be levied on and collected by an Indian stock exchange on which equity shares are sold. Any gain realised on the sale of shares held for more than 12 months to an Indian resident, which are sold other than on a recognised stock exchange and as a result of which no STT has been paid, will be subject to long term capital gains tax in India. Further, any gain realized on the sale of shares held for a period of 12 months or less will be subject to capital gains tax in India. Further, any gain realised on the sale of listed equity shares held for a period of 12 months or less which are sold other than on a recognised stock exchange and on which no STT has been paid, will be subject to short term capital gains tax at a relatively higher rate as compared to the transaction where STT has been paid in India. See the section “Statement of Tax Benefits” on page 198. Capital gains arising from the sale of shares will be exempt from taxation in India in cases where an exemption is provided under a treaty between India and the country of which the seller is a resident. Generally, Indian tax treaties do not limit India’s ability to impose tax on capital gains. As a result, residents of other countries may be liable for tax in India as well as in their own jurisdictions on gains arising from a sale of the shares.

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83. Conditions in the Indian securities market may affect the price or liquidity of the Equity Shares.

In the past, Indian stock exchanges have experienced substantial fluctuations in the prices of listed securities. These exchanges have also experienced problems that have affected the market price and liquidity of the securities of Indian companies, such as temporary exchange closures, broker defaults, settlement delays and strikes by brokers. In addition, the governing bodies of the Indian stock exchanges have from time to time restricted securities from trading, limited price movements and restricted margin requirements. Further, disputes have occurred on occasion between listed companies and the Indian stock exchanges and other regulatory bodies that, in some cases, have had a negative effect on market sentiment. If similar problems occur in the future, the market price and liquidity of our Equity Shares could be adversely affected.

84. Global economic instability or slowdown is likely to adversely affect our business and our results of

operations. Economic developments outside India can adversely affected the economy. During the global financial crisis that began around the second half of 2007, the global credit markets experienced significant volatility, which originated from the adverse developments in the United States and the European Union credit and sub-prime residential mortgage markets. These and other related events, such as the recent collapse of a number of financial institutions and the debt crisis, have had, and may continue to have, a significant adverse impact on the availability of credit and the confidence of the financial markets, globally as well as in India. Our business is affected by domestic and international economic conditions, including rates of economic growth and the impact that such economic conditions have on consumer spending. The global economic downturn led to an increased level of consumer delinquencies, lack of consumer confidence, decreased market valuations and liquidity, increased market volatility and a widespread reduction of business activity generally. The resulting economic pressure and dampened consumer sentiment may adversely affect our business and our results of operations. In addition, the market has been volatile in recent years, and the resulting economic turmoil may continue to exacerbate industry conditions or have other unforeseen consequences, leading to uncertainty about future conditions in our industry. There can be no assurances that government responses to the disruptions in the financial markets will restore consumer confidence, stabilise the markets or increase liquidity and the availability of credit. Any sustained economic downturns or decreases in general economic conditions may have a material and adverse effect on our business, liquidity and results of operations.

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MARKET PRICE INFORMATION As at the date of this Placement Document, 73,40,26,438 Equity Shares are paid-up and outstanding. The Equity Shares have been listed and traded on the BSE and the NSE since April 3, 2008. On September 3, 2014, the closing price of the Equity Shares on the BSE and the NSE was ₹ 14.62 and ₹ 14.55 per Equity Share, respectively. Since the Equity Shares are actively traded on the Stock Exchanges, the market price and other information for each of the BSE and the NSE has been given separately.

(i) The following tables set forth the reported high, low and average market prices and the trading volumes

of the Equity Shares on the Stock Exchanges on the dates on which such high and low prices were recorded for calendar years ended 2011, 2012 and 2013:

BSE Calendar

Year High (₹)

Date of high

Number of Equity Shares

traded on the date of

high

Total turnover on date of

high (₹ lakhs)

Low (₹)

Date of low Number of Equity

Shares traded on the date of

low

Total turnover on date

of low (₹ lakhs)

Average price for the year

(₹)

2013 16.27 Jan 2, 2013 1,117,291 184.95 6.41 Sep 23, 2013 31,632 2.05 9.722012 17.84 Apr 9, 2012 3,501,362 614.27 11.60 Aug 28,

2012 32,105 3.74 13.71

2011 24.10 Jan 3, 2011 202,574 49.85 9.83 Dec 20, 2011

36,698 3.68 16.01

NSE

Calendar Year

High (₹)

Date of high

Number of Equity Shares

traded on the date of

high

Total turnover on date of

high (₹ lakhs)

Low (₹)

Date of low Number of Equity

Shares traded on the date of

low

Total turnover on date

of low (₹ lakhs)

Average price for the year

(₹)

2013 16.35 Jan 2, 2013 2,286,378 378.48 6.40 Sep 23, 2013 328,615 20.79 9.73 2012 17.55 Apr 9, 2012 4,100,510 697.98 11.55 Aug 28,

2012 60,839 7.12 13.71

2011 24.15 Jan 3, 2011 234,738 57.63 9.75 Dec 20, 2011

55,268 5.66 16.02

(Source: www.bseindia.com and www.nseindia.com) Notes: 1) High, low and average prices are based on the daily closing prices. 2) In case of two days with the same closing price, the date with the higher volume has been chosen.

(ii) The following tables set forth the reported high, low and average market prices and the trading volumes

of the Equity Shares on the Stock Exchanges on the dates on which such high and low prices were recorded during each of the last six months:

BSE

Month year

High (₹)

Date of high Number of Equity

Shares traded on date of high

Total turnover on date of high

(₹ lakhs)

Low (₹) Date of low Number of Equity Shares

traded on date of low

Total turnover on date

of low (₹ lakhs)

Average price for the year

(₹)

August 2014

14.11 August 22, 2014

1,52,808 21.52 11.77 August 8, 2014

62,579 7.44 12.83

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BSE Month year

High (₹)

Date of high Number of Equity

Shares traded on date of high

Total turnover on date of high

(₹ lakhs)

Low (₹) Date of low Number of Equity Shares

traded on date of low

Total turnover on date

of low (₹ lakhs)

Average price for the year

(₹)

July 2014 15.65 July 1, 2014 88,600 13.96 12.35 July 30, 2014 62,042 7.68 14.31 June 2014 15.92 Jun 9, 2014 523,595 81.01 13.56 Jun 20, 2014 60,804 8.28 14.72 May 2014 14.99 May 22, 2014 913,349 140.07 8.16 May 8, 2014 10,624 0.87 11.35 April 2014 9.03 Apr 22, 2014 31,546 2.80 7.50 Apr 1, 2014 18,697 1.39 8.39March 2014 7.82 Mar 11, 2014 78,585 5.99 6.77 Mar 3, 2014 19,205 1.31 7.20

NSE Month year High

(₹ ) Date of high Number

of Equity Shares traded on the date of

high

Total volume

of Equity Shares traded on date of high

(₹ lakhs)

Low (₹ )

Date of low Number of Equity Shares

traded on the date of

low

Total volume

of Equity Shares

traded on date of low (₹ lakhs)

Average price for

the month

(₹ )

August 2014 14.10 August 22, 2014

3,15,187 44.37 11.80 August 8, 2014

2,34,269 27.86 12.83

July 2014 15.70 July 1, 2014 3,69,379 58.22 12.30 July 30, 2014 3,72,333 45.99 14.30June 2014 16.00 Jun 9, 2014 20,56,146 319.25 13.55 Jun 16, 2014 207,463 28.08 14.72May 2014 15.00 May 22, 2014 3,093,388 474.52 8.20 May 2, 2014 48,664 4.01 11.35April 2014 9.00 Apr 22, 2014 178,336 15.87 7.60 Apr 1, 2014 50,969 3.83 8.38March 2014 7.90 Mar 11, 2014 254,331 19.87 6.80 Mar 3, 2014 27,306 1.87 7.20(Source: www.bseindia.com and www.nseindia.com) Notes: 1) High, low and average prices are based on the daily closing prices. 2) In case of two days with the same closing price, the date with the higher volume has been chosen. (iii) The following table set forth the details of the number of Equity Shares traded and the turnover during

the last six months and the calendar years ended 2011, 2012 and 2013 on the Stock Exchanges: Period Number of Equity Shares traded Turnover (In lakhs )

BSE NSE

BSE NSE

2013 26,554,447 36,120,294 2470.11 3505.02 2012 30,296,950 49,977,775 4462.59 7293.70 2011 19,488,025 35,576,782 3497.46 6266.70 August 2014 11,45,476 36,25,930 149.58 472.30 July 2014 3,168,807 8,966,351 462.82 1302.11 June 2014 4,056,477 12,869,952 609.26 1931.30 May 2014 9,043,020 29,894,435 1212.70 3962.61 April 2014 900,580 3,281,513 76.93 280.65 March 2014 483,213 1,618,479 35.71 120.37 February 2014 227,714 507,782 15.99 35.71 (Source: www.bseindia.com and www.nseindia.com) (iv) The following table sets forth the market price on the Stock Exchanges on June 23, 2014, the first

working day following the approval of the Board of Directors for the Issue:

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BSE

Open High Low Close Number of Equity Shares traded

Turnover (₹ lakhs)

14.23 14.23 14.23 14.23 27,197 3.87

NSE Open High Low Close Number of Equity

Shares traded Turnover (₹

lakhs) 14.30 14.30 14.30 14.30 241,873 34.59 (Source: www.bseindia.com and www.nseindia.com)

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USE OF PROCEEDS

The gross proceeds from the Issue will be approximately ₹ 25,889.30 lakhs.

The net proceeds from the Issue, after deducting fees, commissions and expenses of the Issue, will be approximately ₹ 25,389.30 lakhs (the “Net Proceeds”).

Subject to compliance with applicable laws and regulations, we intend to use the Net Proceeds of the Issue for equity contribution in projects, repayment of borrowings from banks and financial institutions, general corporate purpose and for meeting exigencies as approved by the Board.

In accordance with the policies approved by the Board and as permissible under applicable laws and government policies, our management will have flexibility in deploying the Net Proceeds. Pending utilisation for the purposes described above, we intend to temporarily invest funds in creditworthy instruments, including money market Mutual Funds and deposits with banks and corporates. Such investments would be in accordance with the investment policies as approved by the Board from time to time and all applicable laws and regulations.

Neither our Promoters nor our Directors are making any contribution either as part of the Issue or separately in furtherance of the objects of the Issue.

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CAPITALISATION STATEMENT

The following table sets forth our consolidated capitalization and total borrowings as of and for the nine month period ended December 31, 2013 and as adjusted for the Issue. This table should be read in conjunction with section “Management’s Discussion and Analysis of Financial Condition and Results of Operations” on page 91 and other financial information contained in section “Financial Statements” on pages F-1 to F-125.

(₹ in lakhs)

  As of December 31, 2013 As adjusted for the

Issue(1) 

Short term debt: 

Secured borrowings  500.00 500.00

Unsecured borrowings  7,298.12 7298.12

 

Long term debt: 

Secured borrowings  354,289.40 354,289.40

Unsecured borrowings  5,355.53 5,355.53

Current Maturities of Long Term borrowings 43,844.98 43,844.98

Total debt  4,11,288.03 4,11,288.03

 

Shareholders’ funds: 

Share capital  14,761.55  18,845.04

Reserves and surplus including securities premium account of ₹ 34,975.11 lakhs (pre-issue) and ₹ 56,780.92 lakhs(2) (adjusted for issue)

52,329.18 74,134.99 

Total funds (excluding loan funds)   67,090.73 92,980.03 

Total capitalisation  4,78,378.76 5,04,268.06

(1) Adjusted to show the number of Equity Shres to be issued pursuant to the Issue (2) The Securities Premium Account is calculated on the basis of gross proceeds of the Issue

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CAPITAL STRUCTURE

The Equity Share capital of our Company as at the date of this Placement Document is set forth below: (In ₹, except share data)

Aggregate value at face value

AUTHORIZED SHARE CAPITAL 1,00,00,00,000 Equity Shares of ₹ 2 each 2,00,00,00,000

TOTAL 2,00,00,00,000

ISSUED AND SUBSCRIBED CAPITAL BEFORE THE ISSUE

73,48,36,688 Equity Shares of ₹ 2 each(1) 1,46,96,73,376

TOTAL 1,46,96,73,376

PAID-UP CAPITAL BEFORE THE ISSUE

73,40,26,438 Equity Shares of ₹ 2 each(2) 1,46,80,52,876

TOTAL 1,46,80,52,876

PRESENT ISSUE IN TERMS OF THIS PLACEMENT DOCUMENT

20,41,74,286 Equity Shares aggregating to ₹ 25,889.30 lakhs(3) 40,83,48,572

PAID-UP CAPITAL AFTER THE ISSUE

93,82,00,724 Equity Shares 1,87,64,01,448

SECURITIES PREMIUM ACCOUNT

Before the Issue 3,49,75,10,764

After the Issue(4) 5,67,80,92,138

(1)

Additionally, upto 51,10,000 Equity Shares may be issued by the Company on exercise of stock options granted under the GIPL ESOP Scheme 2013 taking into account the options that have lapsed as on June 30, 2014.

(2) 1,62,050 Equity Shares having a face value of ₹ 10 each were forfeited pursuant to a resolution of our Board dated July 31,

2009. The face value of the Equity Shares was subsequently changed to ₹ 2 each. (3)

The Issue is authorised by the Board on June 20, 2014 and by the Shareholders on July 15, 2014 (4)

The Securities Premium Account is calculated on the basis of gross proceeds of the Issue Terms/ rights attached to equity shares Our Company has only one class of Equity Shares having a face value of ₹ 2.00 per equity share. Each holder of equity shares is entitled to one vote per Equity Share. Share Capital History of our Company The history of the Equity Share capital of our Company is provided in the following table:

Date of Allotment No. of Equity Shares allotted

Face Value (₹)

Issue Price (₹) Consideration

May 11, 2001 50,000 10 10 Cash October 28, 2002 30,00,000 10 10 Cash March 13, 2003 1,10,00,000 10 10 Cash March 29, 2003 2,54,50,000 10 10 Cash March 31, 2004 9,22,900 10 10 Cash October 17, 2005 3,95,77,100 10 10 Cash November 2, 2005 1,50,00,000 10 10 Cash November 21, 2005 1,70,00,000 10 10 Cash December 19, 2005 1,60,00,000 10 75.88 Cash March 27, 2008 1,20,86,944 10 167 Cash

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Date of Allotment No. of Equity Shares allotted

Face Value (₹)

Issue Price (₹) Consideration

March 27, 2008 44,63,056(1) 10 - - July 31, 2009 (1,62,050)(2) 10 - - 14,43,87,950(3) 10 - - August 11, 2009 72,19,39,750(4) 2 - - December 16, 2009 25,00,000 2 2 Cash April 30,2010 7,50,000 2 16 Cash May 4, 2010 2,00,000 2 16 Cash May 17, 2010 2,42,500 2 16 Cash June 18, 2010 4,06,250 2 16 Cash June 18, 2010 75,000 2 12.79 Cash June 25, 2010 7,50,000 2 16 Cash July 15, 2010 8,30,000 2 16 Cash July 15, 2010 91,665 2 12.79 Cash September 1, 2010 75,000 2 16 Cash September 1, 2010 1,25,000 2 12.79 Cash September 17, 2010 1,50,000 2 16 Cash October 5, 2010 1,25,000 2 12.79 Cash October 13, 2010 50,000 2 12.79 Cash November 15, 2010 41,665 2 12.79 Cash December 6, 2010 75,000 2 12.79 Cash January 5, 2011 2,26,665 2 12.79 Cash January 11, 2011 45,000 2 16 Cash January 11, 2011 41,667 2 12.79 Cash July 29, 2011 23,456 2 12.79 Cash February 2, 2013 52,62,820(5) 2 Total 73,40,26,438 (1) refers to the partly paid Equity Shares that were allotted pursuant to the initial public offering of our Company.

The paid capital on the partly paid shares was ₹ 50.00, where ₹2.50 was paid towards face value and ₹ 47.50 towards premium.

(2) refers to the partly paid Equity Shares that were forfeited pursuant to a resolution of our Board dated July 31, 2009.

(3) refers to such fully paid up Equity Shares of our Company after taking into account such Equity Shares of face value of ₹ 10 each that were forfeited.

(4) The Equity Shares of our Company being sub-divided wherein each Equity Share having a face value of ₹ 10 each was sub-divided into 5 Equity Shares of ₹ 2 each which was approved by our shareholders on September 23, 2009. The record date for the sub-division was October 27, 2009.

(5) Bonus Issue in the ratio of 1(one) Equity Share for every 34 (thirty four) Equity Shares with fractions being rounded off to the next higher whole number.

Our stock option plan

The SEBI issued the Employees Stock Option Scheme and Employees Stock Purchase Scheme Guidelines in 1999 (“ESOP Guidelines”), applicable to stock option schemes on or after June 19, 1999. The Company has used intrinsic value method for valuation of options by reducing the exercise price from the market value. Our Company has instituted an ESOP Scheme “GIPL ESOP 2013”, approved by the shareholders vide their resolution dated September 20, 2013. Pursuant to the ESOP Scheme each option entitles an employee to subscribe to 1 equity share of ₹ 2 each of the Company at an exercise price of ₹ 2 per share upon expiry of the respective vesting period which ranges from one to not more than five years. A first tranche of 61,60,000 options were issued on September 23, 2013 with vesting period ranging from 1 to 4 years with effect from October 1, 2014. Our Company has granted stock option to some of our Directors, under the GIPL ESOP 2013. For more details, please see “Risk Factors – The Companies Act, 2013 has effected significant changes to the existing Indian company law framework and SEBI has introduced changes to the listing agreement, which are effective from October 1, 2014, which may subject us to higher compliance requirements and increase our compliance costs” on page 76. As of December 31, 2013, a total of 8,40,000 options were forfeited / lapsed and balance 53,20,000 options were outstanding. As of June 30, 2014, a total of 10,50,000 options were forfeited / lapsed and balance 51, 10,000 were outstanding.

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DIVIDENDS

The declaration and payment of dividends will depend on a number of factors, including but not limited, to our profits, capital requirements and overall financial condition. Under the Companies Act, unless the board of directors of a company recommends payment of dividend, the shareholders at a general meeting have no power to declare any dividend. The shareholders at a general meeting may declare a lower, but not higher, dividend than that recommended by the board. Dividends are declared on a per-share basis of a company’s shares. The dividend recommended by the board and approved by the shareholders at a general meeting is distributed and paid to shareholders in proportion to the paid-up value of their shares as on the record date for which such dividend is payable. The Company has not paid any dividends to its members in the last three Financial Years. For a summary of certain Indian consequences of dividend distributions to shareholders, see the section “Statement of Tax Benefits” on page 198.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with Financial Statements and related notes included elsewhere in this Placement Document. Our Financial Statements as of and for the Financial Years ending March 31, 2012, March 31, 2013 and as of and for the nine month period ended December 31, 2013 have been prepared and presented in accordance with Indian GAAP and applicable provisions of the Companies Act. Unless otherwise indicated, references in this discussion and analysis to our results of operations or financial condition for a specified year are to our Financial Year ended March 31, 2012 or March 31, 2013 or the nine month period ended December 31, 2013, as the case may be. Our Financial Statements are prepared in in Rupees. Our Financial Statements for the last three Financial Years may not be comparable due to the change in the Financial Year after March 31, 2013.Our current Financial Year is for the period from January 1 to December 31 and accordingly the Financial Statements for the nine month period ended December 31, 2013 is for a period of 9 months. Accordingly the nine month period ended December 31, 2013 may not be comparable to the 12 months period Financial Year ending on March 31, 2013. For presentation purpose in this chapter, we have presented the amounts in Rs. Lakh although our Financial Statements are presented in Rupees. You should read the section “Forward-Looking Statements” for a discussion of the risks and uncertainties related to those statements and also the section “Risk Factors” for a discussion of certain factors that may affect the Company’s business, results of operations, cashflows and financial condition. Overview

We were incorporated in April 2001 with a focus on participating in infrastructure project development undertaking PPP projects and other infrastructure projects involving private financial participation in various sectors on build operate transfer (BOT) and other allied basis. We are a part of the Gammon Group, which is a diversified business group with civil engineering and construction as its major business interests. GIL, our Promoter and the flagship company of the Gammon Group, is among the leading construction companies in India specialising in design and construction in the areas of transportation, engineering, industrial structures, energy projects, high rise structures, bulk storage facilities, foundation engineering, hydraulic works, irrigation projects and controlled demolition techniques. We operate as an infrastructure holding company with interests in sectors such as roads, ports and power through SPVs responsible for carrying on specific projects being undertaken by us. Our current portfolio of projects consists of 17 projects in the roads, ports and power sector, of which 6 projects have commenced commercial operations (“Operations Phase”), 8 projects have achieved Financial Closure or have achieved Financial Closure but are under revalidation and have commenced development or are in advanced stages to commence development (“Development Phase”) and 3 projects are in initial stages of project lifecycle and yet to achieve Financial Closure (“Pre-development Phase”). Our Company also undertakes services in other areas of project development, such as construction contracts, project advisory services, project management and operations and maintenance activities, which we provide to entities in our Group. Our key assets across the sectors as on date are set out below:

Phases Roads Sector Ports Sector Power Sector

Operations Phase

1. Rajahmundry Expressway Annuity Road Project (kms. 200.00 to 253.00 on NH-5)

2. Andhra Expressway Annuity Road Project (Kms. 253.00 to 300.00 on NH-5)

3. Kosi Bridge Annuity Road Project (including approaches and bunds) (Kms. 155.00 to

1. Visakhapatnam Port Project (operating 2 berths for multipurpose cargo handling)

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Phases Roads Sector Ports Sector Power Sector

165.00 on NH-57)

4. Gorakhpur Annuity Road Project (kms. 0.00 to 32.27 of Gorakhpur bypass on NH-28)

5. Mumbai Nasik Expressway Toll Road Project (kms. 539.50 to 440.00 on NH-3)

Development Phase

1. Patna Highways Annuity Road Project (kms. 0.00 to 46.30 on NH-77 and 16.870 kms new bypass starting at km 46.300 on NH-77)

2. Rajahmundry Godavari Toll Road Project (kms. 82/40 to on EGK* road to 197/4 on NH-5)

3. Sidhi Singrauli Toll Road Project (Kms. 83/40 to 195/80 on NH-75E)

4. Vijayawada Gundugolanu Toll Road Project (kms. 1076.48 to 1022.48 on NH-5)

5. Patna Buxar Toll Road Project (kms. 0.00 to 124.85 on NH-30 including bypass section on NH-84)

1. Mumbai Off-shore Container Terminal Project

1. Pravara Co-generation Power Project (30 MW)

2. Rangit II Hydroelectric Power Project (66 MW)

Pre-Development Phase

1. Tidong Hydroelectric Power Project (60 MW)

2. Youngthangkhab Hydroelectric Power Project (261 MW)

3. Aparna Infraenergy Thermal Power Project (250 MW)

* Eluru-Gundugolanu-Kovvur (EGK) Our Road Business Our infrastructure projects under the road sector currently comprise of 10 projects, out of which 5 are in Operations Phase and 5 are under Development Phase. The following road projects are in the Operations Phase: Rajahmundry Expressway Annuity Road Project: strengthening of the existing 2 lanes and widening of the

same to 4 lane dual carriageway from kms. 200.00 to 253.00 (approximately 53 kms.) on the Rajahmundry – Dharmavaram section of NH-5 in the state of Andhra Pradesh, being developed and maintained by our SPV, REL, which commenced commercial operations on September 20, 2004;

Andhra Expressway Annuity Road Project: strengthening of the existing 2 lanes and widening thereof to 4

lane dual carriageway, from kms. 253.00 to 300.00 (approximately 47 kms.) on the Dharmavaram-Tuni

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section of NH-5 in the state of Andhra Pradesh, being developed and maintained by our SPV, AEL, which commenced commercial operations on October 30, 2004;

Kosi Bridge Annuity Road Project: designing, construction, financing, maintenance and operation of a 4 –

lane Bridge across the river Kosi (including its approaches and guide bund and afflux bund) from kms. 155.00 to 165.00 (designed chainage: kms. 148.550 to 159.185, approximately 10.635 kms.) on NH – 57 , in the State of Bihar and is being developed and maintained by our SPV, KBICL, which commenced commercial operations on February 8, 2012;

Gorakhpur Annuity Road Project: designing, construction, financing, maintenance and operation of a

bypass from kms. 0.00 to 32.27 (approximately 32.27kms.) on NH – 28, in Gorakhpur located in the state of Uttar Pradesh and is being developed and maintained by our SPV, GICL, which commenced commercial operations on March 31, 2012; and

Mumbai Nasik Expressway Toll Road Project: envisaging improvement, operation, maintenance,

rehabilitation and strengthening of the existing 2- lane road and widening the same to 4 –lane divided highway, from kms. 539.50 to 440.00 (approximately 99.50 kms.) on the Vadape – Gonde section of NH-3, located in the state of Maharashtra and is being developed and maintained by our SPV, MNEL, which commenced partial operations on May 11, 2010 and full operations on July 11, 2011. The final COD was achieved in June 2012.

The following roads projects are in the Development Phase: Patna Highways Annuity Road Project: upgradation of Hajipur-Muzzafarpur section of the existing NH-77

to four lane dual carriageway, from kms. 0.00 to 46.30 (approximately 46.30 kms.) and construction of 16.870 kms. New bypass starting at km. 46.300 and connecting NH-28 of East – West corridor at 515.045 kms. (total length approximately 63.371 kms.) on Patna-Muzzafarpur section of NH-77, in the state of Bihar, being developed and maintained by our SPV. PHPL, was supposed to commence commercial operations from August, 2014.

Rajahmundry Godavari Toll Road Project: designing, construction, financing, maintenance and operation of

a major bridge across river Godavari with approach roads starting at km 82.4 of Eluru-Gundugolanu-Kovvur road on Kovvur side joining NH-15 at km 197.4 on Rajahmundry side in the State of Andhra Pradesh being developed and maintained by our SPV, RGBL, which is expected to commence commercial operations in March, 2015;

Sidhi Singrauli Toll Road Project: augmentation of existing road by four laning of Sidhi – Singrauli section

on NH – 75E from kms. 83.4 to 195.8 (approximately 102.60 kms.), located in the State of Madhya Pradesh, being developed and maintained by our SPV, SSRPL, which is expected to commence its commercial operations within 730 days from the appointed date (i.e. September 19, 2013);

Vijayawada Gundugolanu Toll Road Project: augmentation of existing NH-5 by six laning of Vijayawada –

Gundugolanu section from kms. 1,076.48 to 1,022.48, including 6 lane Hanuman Junction by pass, (i.e. 6.72 kms.) and 4 – lane Vijayawada bypass (approximately 47.88 kms.) (total length approximately 103.59 kms.), located in the state of Andhra Pradesh, to be developed and maintained by our SPV, VGRPPL, which is expected to commence its commercial operations within 912 days from the appointed date (as defined under the concession agreement). The appointed date has been notified as September 1, 2014. Tolling operations at the two toll booths of Vijayawada Gundugolanu Toll Road Project has commenced with effect from September 1, 2014; and

Patna Buxar Toll Road Project: augmentation of existing road by four laning of the Patna-Buxar section on NH – 30 & NH - 84 from kms. 0.00 to 124.850 (total length approximately 125.443 kms.), located in the state of Bihar, proposed to be developed and maintained by our SPV, PBHL.

Our Port Business Our projects under the port sector currently comprises of 2 projects, out of which 1 is in its Operations Phase and 1 is under its Development Phase. The following port project is in its Operations Phase:

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Visakhapatnam Port Project: developed and maintained by our SPV, VSPL, operating two multipurpose

berths for handling coal, lime stone, rock phosphate, sulphur and other bulk cargo or general cargoes or liquid bulk cargo (non-hazardous) at Visakhapatnam port which commenced commercial operations on July 24, 2004 and September 8, 2005. Vide letter dated January 28, 2014, VPT has granted leasehold rights to VSPL on additional land admeasuring 30 acres for the purpose of storage and handling of cargo.

The following port project is in its Development Phase: Mumbai Port Project: operation and management including necessary developments, modifications and

augmentation of facilities, of the Ballard Pier Station Container Terminal and development, construction, operation and management of an off-shore container terminal in the Mumbai Harbour proposed to be developed, maintained and operated by our SPV, ICTPL, which is expected to commence commercial operations from January 31, 2016.

Our Power Business Our projects under the power sector currently comprise of 5 projects, out of which 2 are in their Development Phase and 3 are in their Pre-development Phase. The following power projects are under Development Phase: Pravara Co-generation Power Project: development and operations of a 30 MW bagasse-based power co-

generation project in Pravara Nagar, Taluka Rahata, District Ahmednagar, Maharashtra, proposed to be developed and maintained by our SPV, PREL, which was supposed to commence commercial operations from September 1, 2014; and

Rangit II Hydroelectric Project: development and operations of a 66 MW hydroelectric project on the

Rimbi river in West Sikkim, proposed to be developed and maintained by our SPV, SHPVL, which is expected to commence from December 8, 2015 as per the letter received from Government of Sikkim dated February 10, 2010. However, the Company expects the commercial operations to commence within 3 years from the date of first disbursement of the debt component from the lenders.

The following power projects are under the Pre-Development Phase: Tidong Hydroelectric Power Project: a 60 MW hydroelectric project in District Kinnaur in Himachal

Pradesh on the river Tidong (a tributary of river Satluj), proposed to be developed and maintained by our SPV, THPL;

Youngthangkhab Hydroelectric Project: a 261 MW hydroelectric power project in District Kinnaur on the

Spiti/Satluj river in the state of Himachal Pradesh proposed to be developed and maintained by our SPV, YPVL; and

Aparna Infraenergy Thermal Power Project, a 250 MW coal based thermal power project, in Mauza-

Kawthala, Taluka Chimur, District Chandrapur, Maharashtra, proposed to be developed and maintained by our SPV, AIIPL.

Our EPC Business Our Company has ventured into undertaking EPC business by way of project monitoring through sub-contracting route for its own projects awarded by NHAI and other state road development authorities. This route allows our Company to leverage its management expertise thereby achieving efficient margins and de-risking contractual hurdles. Currently, our Company is undertaking EPC works in for two of our Subsidiaries, VGRPL and SSRPL.

For the risks related to our aforesaid projects, please refer to section titled “Risk Factors” on page 49. On a consolidated basis, our total income for the Financial Year 2012-13 and the nine month period ending December 31, 2013 is ₹69,813.92 lakhs and ₹46,065.91 lakhs, respectively and our net profit / (loss) (being profits attributable to the Group shareholders) for the Financial Year 2012-13 and the nine month period ending

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December 31, 2013 is ₹1,472.63 lakhs and ₹ (5,644.39) lakhs, respectively. In accordance with the Unaudited Consolidated Interim Condensed Financial Statement as of and for the six months period ending June 30, 2014, our total income is ₹ 36,931.24 lakhs and our net profit / (loss) (being profits attributable to the Group shareholders) is ₹ (6,116.52) lakhs. RECENT DEVELOPMENTS Set out below are certain key developments that have taken place since the date of our last audited consolidated Financial Statements which was for a period of 9 months ending on December 31, 2013: Roads Sector Our SPV, YPHPL has entered into an agreement with NHAI on March 14, 2014, for the termination of

concession agreement dated July 30, 2012, for four laning of the Uttar Pradesh-Haryana border on the Yamunanagar-Saha-Barwala-Panchkula section of NH – 73, in the State of Haryana, as YPHPL was unable to commence construction activities at the project site on account of non availability of land and certain government approvals. For more details, please refer to “Risk Factors” on page 49.

Our SPV, BBHPL has entered into an agreement with NHAI on March 28, 2014, for the termination of

concession agreement dated May 31, 2012, executed for the purpose of rehabilitation and upgradation of Birmitrapur – Barkote section of NH – 23, in the State of Orissa, as BBHPL was unable to commence construction activities at the project site on account of non availability of land and certain government approvals. For more details, please refer to “Risk Factors” on page 49.

Our SPV, PBHL has entered into a concession agreement with NHAI on February 02, 2012 and has

initiated discussions with NHAI for mutual termination of concession agreement executed for 4-laning of the Patna – Buxar stretch of NH-30 and 84, in the State of Bihar, as PBHL is unable to proceed with construction activities at the project site on account of non availability of land and certain government approvals. For more details, please refer to “Risk Factors” on page 51.

In relation to our SPV, PBHL, on August 30, 2014, NHAI encashed a sum of ₹1,129.11 lakhs, out of the

performance bank guarantee of ₹5,646 lakhs due to default of the due and faithful fulfilment and compliance with the terms and conditions contained in the concession agreement. We intend to contest the matter in an appropriate forum.

Our SPV, CBICL, operating the Cochin Bridge Project was obstructed from collecting toll at the Cochin

Bridge Project by the Greater Cochin Development Authority on April 27, 2014 by unilaterally sealing the toll booth. For details please refer to “Legal Proceedings” and “Risk Factors” on pages 212 and 65 respectively.

Port Sector Our SPV, MTL has entered into a concession agreement with Mormugao Port Trust on January 18, 2013

for providing mechanized handling facilities for handling coal at berth no. 11 at Mormugao Port in the state of Goa. MTL and the Mormugao Port Trust were to satisfy all the conditions precedent by February 2014. However, due to a disagreement between the parties in relation to non-compliance of conditions precedent, Mormugao Port Trust has communicated that it is unilaterally terminating the concession agreement. Subsequently, MTL filed a suit for injunction and obtained a stay order on the termination of the concession agreement and the invocation of the bank guarantee of ₹ 200.00 lakhs. Further, despite the ad-interim stay order the bank guarantee has been invoked by Mormugao Port Trust. For more details, please refer to “Legal Proceedings” on page 214 and “Risk Factors” on page 50.

Power Sector In relation to our Youngthangkhab Hydroelectric Power Project, YPVL has initiated correspondence with

the GoHP for exiting from the Youngthangkhab Hydroelectric Power Project primarily due to inability of the GoHP in resolving the local agitations related to environmental issues because of which YPVL was forced to stop the geological studies. YPVL vide letter dated June 19, 2014 requested GoHP for mutual

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termination of the Youngthangkhab Hydroelectric Power Project and has also requested to re-imburse / refund an amount of ₹ 12,794.09 lakhs on account of losses (including the upfront premium, interest and expenses) incurred by YPVL. The GoHP is yet to respond to YPVL’s letter. For more details, please refer to “Risk Factors” on page 49.

Principal Factors Affecting Our Performance Our business, results of operations and financial condition are affected by a number of factors, including: Competition We compete against various developer companies engaged in the infrastructure sector who undertake projects in the road, ports and power sectors. Our competition varies depending on the size, nature and complexity of the project and on the geographical region in which the project is to be executed. In selecting contractors for major projects, clients generally limit the tender to contractors they have pre-qualified based on several criteria, including experience, technical ability, performance, reputation for quality, safety record, financial strength and the size of previous contracts executed in similar projects, although the price competitiveness of the bid is usually the most important selection criterion. Pre-qualification is key to our winning major projects. We are currently qualified to bid for projects up to certain contract values depending on the project sponsor. To bid for some higher value contracts, we sometimes seek to form strategic alliances or joint ventures with other experienced and qualified companies. Our asset portfolio Currently, we have five road projects and one port project in the Operations Phase. Five of our road projects, one port project and two power projects are under Development Phase and three of our power projects are under Pre-development Phase. Receivable payment from our clients Till date there have been no delays associated with the collection of receivables from clients including government owned, controlled or funded entities, except in two cases. In case of one of our road (bridge) project SPV, no annuities were received for which our SPV has initiated arbitration procedures, while in case of another road project, the client has withheld part of the annuity till such time all punch list items are completed. For further details please refer to the section titled “Business” on page 127. Our operations involve significant working capital requirements and long delays in the collection of receivables, which could adversely affect our liquidity and results of operations. Currently, a majority of road projects in Operations Phase receive annuities. While majority of our road projects under Development Phase are toll projects, we expect to continue to engage in annuity projects in the future. Such annuity projects may involve our taking on the long-term risk of default on annuity payments from clients. Changes in tax laws and regimes We currently have operations and staff spread across many Indian states. Consequently, we are subject to the jurisdiction of a number of tax authorities and regimes. The revenues recorded and income earned in these various jurisdictions are taxed on differing bases, including net income actually earned, net income deemed earned and revenue-based tax withholding. The final determination of our tax liabilities involves the interpretation of local tax laws and related authorities in each jurisdiction as well as the significant use of estimates and assumptions regarding the scope of future operations and results achieved and the timing and nature of income earned and expenditures incurred. Changes in our operating environment, including adverse changes in any of the taxes levied by the Central or state Governments, could impact the determination of our tax liabilities for any given tax year. Ability to attract, recruit and retain skilled personnel A significant number of our employees are skilled engineers and we face strong competition to attract, recruit and retain these and other skilled and professionally qualified staff. The loss of any of the members of our senior management, our Directors or other key personnel or an inability to manage the attrition levels in different employee categories may materially and adversely impact our business and results of operations.

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Cost of raw materials, labour and other inputs The cost of raw materials, fuel, labour and other inputs constitutes part of our operating expenses. Our construction operations require various construction raw materials including steel and cement. Fuel costs for operating our construction and other equipment also constitutes a part of our operating expenses. Our ability to pass on increases in the purchase price of raw materials, fuel and other inputs may be limited in the case of fixed-price contracts or contracts with limited price escalation provisions. Unanticipated increases in the price of raw materials, fuel costs, labour or other inputs not taken into account in our bid and delays in performing parts of the contract can have compounding effects by increasing the costs of performing other parts of the contract. These variations and the risks generally inherent to the construction industry may result in our profits being different from those originally estimated and may result in our experiencing reduced profitability or losses on projects. Basis of Presentation Our Financial Statements have been prepared to comply in all material respects with the notified accounting standards by the Companies (Accounting Standards) Rules 2006 (as amended) and the relevant provisions of the Companies Act, 1956 which as per a clarification issued by the Ministry of Corporate Affairs would continue to apply under Section 133 of the Companies Act, 2013. The consolidated Financial Statements have been prepared under the historical cost convention, on an accrual basis of accounting. The classification of assets and liabilities of the Company is done into current and non-current based on the criterion specified in the revised schedule VI notified under the Companies Act, 1956. The accounting policies adopted in the preparation of Financial Statements are consistent with those used in the previous year. The Financial Statements have been combined on a line by line basis by adding the book values of like items of assets, liabilities, income and expenses, after fully eliminating intra-group balances, intra-group transactions and unrealized profits or losses as per Accounting Standard – 21 (‘AS-21’) “Consolidated Financial Statements” notified under the Companies (Accounting Standards) Rules, 2006. The consolidated Financial Statements have been prepared using uniform policies for like transactions and other events in similar circumstances and are presented to the extent possible in the same manner as our Company’s stand-alone Financial Statements. The excess of cost of investments of the Group over its share of equity in the Subsidiaries is recognised as goodwill. The excess of share of equity of Subsidiaries over the cost of investments is recognised as capital reserve. Critical Accounting Policies The preparation of Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the Financial Statements and the results of operations during the reporting period end. Although these estimates are based upon management’s best knowledge of current events and actions, actual results could differ from these estimates. Revenue recognition Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognised. Road Projects In relation to the toll road projects, the toll revenue from operations of such roads is recognised on usage and recovery of the usage charge thereon. As regards, our Road Projects with annuity income, the income earned from these projects is recognised on a time basis over the period during which the annuity is earned. Revenues from bonus and other claims are recognised upon acceptance from customer / counterparty. Port Business

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Revenue by way of berth hire charges, dust suppression charges, cargo handling charges, plot rent, wharfage, barge freight, other charges etc. are recognised on an accrual basis and is billed as per the terms of the contract with the customers at the rates approved by TAMP as the related services are performed. Operations and maintenance The revenue received by the Company on the operation and maintenance contracts is recognised over the period of the contract as per the terms of such contracts. Construction contract business Revenue from construction contracts is recognised on the basis of percentage completion method. The percentage of work completed is determined by the expenditure incurred on the job till date to the total expected expenditure of the contract. Construction contracts are progressively evaluated at the end of each accounting period. On contracts under execution which have reasonably progressed, profit is recognised by evaluation of the percentage of work completed at the end of the accounting period. Foreseeable losses on contract are fully provided for in the respective accounting period. Others Dividend income is recognized when the right to receive dividend is established by the reporting date Interest income is recognized on a time proportion basis, taking into account the amount outstanding and the applicable interest rate. Tangible assets Tangible assets are stated at cost net of accumulated depreciation and accumulated impairment losses, if any. The cost comprises the purchase price and any attributable cost of bringing the asset to its working condition of its intended use. The costs comprises of the purchase price, borrowings costs if capitalization criteria are met and directly attributable costs of bringing the asset to its working condition for the intended use. Any trade discounts and rebates are deducted in arriving at the cost of the tangible asset. Any subsequent expenses related to a tangible asset is added to its book value only if it increases the future benefits from the existing asset beyond its previously assessed standard of performance. All other day to day repairs and maintenance expenditure and the cost of replacing parts, are charged to the statement of profit and loss for the period during which such expenses are incurred.

Depreciation on tangible fixed assets is provided on the Straight Line Method (‘SLM’) at the rates and in the manner laid down in Schedule XIV of the Companies Act, 1956 or the rates based on the estimated useful lives of the fixed assets, whichever is higher. Depreciation on tangible fixed assets purchased / installed during the year/ period is calculated on a pro-rata basis from the date of such purchase / installation.

Gains or losses arising from derecognition of tangible fixed assets are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of profit and loss when the asset is derecognised. Intangible assets Intangible assets are stated at cost of construction less accumulated amortised amount and accumulated impairment losses, if any. Costs include direct costs of construction of the project and costs incidental and related to the construction activity. Costs incidental to the construction activity, including financing costs on borrowings attributable to construction of the project road, have been capitalised to the project road till the date of completion of construction. Such assets include self-constructed assets under the BOT (Annuity) scheme, concession rights in respect of tollable roads, etc. The intangible assets comprises of the rights that arise from our right to undertake operations and maintenance which shall result

in an income stream for the Group over the period of such concession or license, as the case maybe are amortised over the period; from the date such project becomes operational.

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comprising of our Road Projects and Port Projects are amortised on a straight line basis, from the date they are put to use, over the balance period of the concession or license, as the case maybe. The amortisation period and the amortisation method are reviewed at the end of each Financial Year. The rights granted pursuant to the concessions, are amortised on the pro-rata basis of actual tollable traffic volume for the period over the total projected tollable traffic volume over the toll periods granted for the project. The volume of the traffic is reviewed on periodic intervals for its consistency and appropriateness. If the right to collect toll being amortised is revised on account of the material change in the projected traffic volume arising out of the periodic review, the amortisation would be revised accordingly.

of our Company also comprise of the license fees paid to Mumbai Port trust for construction and operation of an off-shore terminal, and are amortised over the period; from the date such project becomes operational.

Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of profit and loss when the asset is derecognised. Intangible asset under development is stated at cost of development less accumulated impairment losses, if any. Costs include direct costs of development of the project road and costs incidental and related to the development activity. Costs incidental to the development activity, including financing costs on borrowings attributable to the development of the project road, are capitalised to the project road till the date of completion of development. Impairment The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Group estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or cash-generating unit’s (CGU) net selling price and its value in use. The recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining net selling price, recent market transactions are taken into account, if available. If no such transactions can be identified, an appropriate valuation model is used. The Group comprises of companies which are each engaged in developing a project facility. On creating these facilities the said companies establish a right to charge the users of the project development facility. The project development costs are recovered by these companies from the users of the project facilities through toll or are compensated by the grantor through annuities. For testing the impairment of the project facility developed, these companies conduct impairment tests based on detailed discounted cash flows annually. The periods of the cash flow are from the date, the project was awarded to the date the project has to be handed over to the grantor. Impairment losses of operations, including impairment on inventories, are recognised in the statement of profit and loss, except for previously revalued tangible fixed assets, where the revaluation was taken to revaluation reserve. In this case, the impairment is also recognised in the revaluation reserve up to the amount of any previous revaluation. After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life. Investments Investments that are readily realisable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long-term investments. On initial recognition, all investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties. Inventories Stores and consumables are valued at lower of cost and net realisable value and is determined using the

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weighted average method. Net realisable value is the estimated selling price less estimated cost necessary to make the sale. Borrowing costs Borrowing cost includes interest, amortisation of ancillary costs incurred in connection with the arrangement of borrowings and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost. Borrowing costs that are directly attributable to the acquisition, construction or production of an asset that takes a substantial period of time to get ready for its intended use are capitalised. Other borrowing costs are recognised as expenditure in the period in which they are incurred. Provision for taxes Tax expense comprises current and deferred tax. Current income-tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income-tax Act, 1961 enacted in India and tax laws prevailing in the respective tax jurisdictions where the Group operates. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current income tax relating to items recognised directly in equity is recognised in equity and not in the statement of profit and loss. Deferred income taxes reflects the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set-off current tax assets against current tax liabilities and the deferred tax assets and the deferred tax liabilities related to the taxes on income levied by same governing taxation laws and to the same taxable entity. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. In situations where the Group has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognised only if there is virtual certainty supported by convincing evidence that they can be realised against future taxable profits. In the situations where any company within the Group is entitled to a tax holiday under the Income-tax Act, 1961 enacted in India or tax laws prevailing in the respective tax jurisdictions where it operates, no deferred tax (asset or liability) is recognised in respect of timing differences which reverse during the tax holiday period, to the extent the said company’s gross total income is subject to the deduction during the tax holiday period. Deferred tax in respect of timing differences which reverse after the tax holiday period is recognised in the year in which the timing differences originate. However, the said company restricts recognition of deferred tax assets to the extent that it has become reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available against which such deferred tax assets can be realised. For recognition of deferred taxes, the timing differences which originate first are considered to reverse first.

Minimum alternate tax (“MAT”) paid in a year is charged to the statement of profit and loss as current tax. The Group recognises MAT credit available as an asset only to the extent that there is convincing evidence that the Group will pay normal income tax during the specified period, i.e., the period for which MAT credit is allowed to be carried forward. In the year in which the Group recognizes MAT credit as an asset in accordance with the Guidance Note on Accounting for Credit Available in respect of MAT under the Income-tax Act, 1961, the said asset is created by way of credit to the statement of profit and loss and shown as “MAT Credit Entitlement.” The Group reviews the “MAT credit entitlement” asset at each reporting date and writes down the asset to the extent the Group does not have convincing evidence that it will pay normal tax during the specified period. Foreign currency translation Initial recognition Foreign currency transactions are recorded in the reporting currency by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction. Conversion

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Foreign currency monetary items are reported using the closing rate. Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction; non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined. Exchange differences Exchange differences arising on the settlement of monetary items or on reporting the Group’s monetary items at rates different from those at which they were initially recorded during the year, or reported in previous financial statements, are recognised as income or as expenses in the year in which they arise except those arising from investments in non-integral operations. Our Results of Operations The following table sets forth certain income and expenses statement data from our consolidated Financial Statements, in absolute terms and as a percentage of our total income for the years indicated, as indicated. Summary of Profit and Loss data for the years ended March 31, 2012, March 31, 2013 and nine month period ended December 31, 2013

(₹ in lakhs) Particulars March 31, 2012 March 31, 2013 December 31, 2013 Amount %(1) Amount %(1) Amount %(1)

Income Revenue from operations: Revenue from projects 39,917.10 92.97% 66,219.35 94.85% 44,132.37 95.80% Other operating revenues 2,376.75 5.53% 2,818.32 4.04% 1,285.43 2.79% Other income 643.68 1.50% 776.25 1.11% 648.11 1.41% Total income

42,937.53 100.00% 69,813.92 100.00

% 46,065.91 100.00%

Expenses Project expenses 13,743.92 32.01% 16,619.46 23.81% 13,100.15 28.44% Employee benefits expenses 2,567.56 5.98% 2,892.54 4.14% 2,435.30 5.29% Other expenses 3,378.26 7.87% 2,789.79 4.00% 2,145.87 4.66% Exceptional items 970.48 2.26% - - - - Total expenses 20,660.21 48.12% 22,301.79 31.94% 17,681.32 38.38% Earnings before interest, taxes, depreciation and amortisation (EBITDA)

22,277.32 51.88% 47,512.13 68.06% 28,384.59 61.62%

Finance costs 15,565.94 36.25% 29,683.38 42.52% 21,902.87 47.55% Depreciation/amortisation 7,789.92 18.14% 16,085.22 23.04% 11,956.02 25.95% Share of (profit)/loss from investment in associates

(26.62) -0.06% (3.72) -0.01% 11.78 0.03%

Profit/(Loss) before tax (1,051.92) -2.45% 1,747.26 2.50% (5,486.08) -11.91% Less: Tax expenses Current tax 1,333.89 3.11% 3,032.97 4.34% 338.14 0.73% Deferred tax (credit)/charge (9.94) -0.02% (3,301.90) -4.73% (111.37) -0.24% MAT credit entitlement (171.40) -0.40% (486.96) -0.70% (229.25) -0.50% Short provision for earlier years - - 16.79 0.02% 97.32 0.21% Net tax expense 1,152.56 2.68% (739.11) -1.06% 94.85 0.21% Profit/(Loss) after tax (2,204.47) -5.13% 2,486.37 3.56% (5,580.93) -12.12% Less : Profit after tax attributable to minority interest

337.34 0.79% 1,013.73 1.45% 63.46 0.14%

Profit / (Loss) attributable to group shareholders

(2,541.81) -5.92% 1,472.63 2.11% (5,644.39) -12.25%

(1) Percentage to total income for respective years / period.

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Principal Revenue Statement Items Revenue from Operations Our revenue from operations is broken down as follows: Revenues from projects We are engaged is the development of infrastructure projects under the public private participation model and private financial participation through our SPVs and joint ventures. These SPVs are engaged in development of infrastructure projects and earn revenue by charging the users availing the benefits of the said infrastructure or derive revenue from the payments received by the concessionaire / licensor. The Group is presently engaged in the construction and development of infrastructure assets in the roads, ports and power sectors. The revenues from development of Road Projects are of two types i) toll collection from the users of the developed road/bridge from the date of commencement of operations of the road project till the end of the concession period as stated in the respective projects concession agreement ii) fixed annuities from the date of commencement of the road project throughout the operating life of the project, paid every six months from the client. Revenues are also generated from carrying on our port operations where the users of the ports pay charges for utilizing the facilities provided by the said SPVs. These revenues are consolidated under revenue from port operations. The other sources of revenues include

advisory fees, and developer fees charged by our Company for the services rendered to the SPVs which include

conducting traffic/engineering surveys for submitting the technical/commercial bids, providing services in all matters of project development in technical, administration, legal, financial, and other areas from the period when the bids for the project were invited by the respective clients upto the date of commencement of operations of the projects in which the group was successful in bidding.

Maintenance activities include carrying out activities at some of its operating SPVs in addition to carrying out civil works on behalf of its SPVs. Other Operating revenues Our other operating revenues consist of the operating grants received by us and income from the change of scope; for our Road Projects pursuant to the respective concession agreement. We also receive revenues from other activities such as weighment charges, scrap sales of some of the goods. Other Income Other income includes interest income from investments, bank deposits and other miscellaneous income which also includes insurance claims. Expenses Our expenses have the following major components:

project expenses includes

o repairs and maintenance for the Road Projects include material consumption cost, sub-contracting expenses towards operating and maintenance activities,

o port cargo handling expenses; o royalty on revenues to be paid at our Port Project to client o periodic maintenance of Road Projects o power and fuel expenses; and o other project expenses.

employee expenses which includes salaries, bonus to our employees and directors and costs for the

GIPL ESOP Scheme,

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Other expenses constitute administration expenses, professional and consultancy fees, insurance charges, provisions and / or write offs of losses and doubtful debts and advances. Other expenses also includes losses of one of our port project in Development Phase being undertaken by our joint venture SPV at Mumbai, which were accounted by us fully on the basis of a share purchase agreement dated dated July 29, 2010 and an agreement to sell dated July 29, 2010. The said agreements expired in January, 2011.

finance costs (including interest on term loans, fee payable for such loans, guarantee commissions, interest to others and prepayment premiums) and related and ancillary costs for procuring funding for the projects

Depreciation / amortization of tangible and intangible assets put to use.

Share of profit / (loss) are on account of consolidation of net of profits/(losses) of associates on the basis of the percentage of holding in each of the said associate.

Taxes Our tax expense comprises of:

current taxes paid by the group at normal tax rates as per the Income Tax Act, 1961 deferred tax (credit)/charge are the tax effect of timing differences. Timing differences are the

differences between taxable income and accounting income for a period that originate in one period and are capable of reversal in one or more subsequent periods.

MAT paid by the Group as per the Income Tax Act, 1961. MAT credit entitlement as per the Income Tax Act, 1961.

See “Risk Factors” on page 49. Aassessment of Historical Operating Results Nine month period ended December 31, 2013

(₹ in lakhs)

PARTICULARS AMOUNT Income Revenue from operations:

Revenue from projects 44,132.37 Other operating revenues 1,285.43

Other income 648.11 Total income 46,065.91 Expenses Project expenses 13,100.15 Employee benefits expenses 2,435.30 Other expenses 2,145.87 Exceptional items - Total expenses 17,681.32 Earnings before interest, taxes, depreciation and amortisation (EBITDA) 28,384.59 Finance costs 21,902.87 Depreciation/amortisation 11,956.02 Share of (profit)/loss from investment in associates 11.78

Profit/(Loss) before tax (5,486.08) Less: Tax expenses

Current tax 338.14 Deferred tax (credit)/charge (111.37) MAT credit entitlement (229.25) Short provision for earlier years 97.32

Net tax expense 94.85 Profit/(Loss) after tax (5,580.93) Less : Profit after tax attributable to minority interest 63.46

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Total Income The total income consists of ₹ 46,065.91 lakhs of which ₹ 44,132.37 lakhs was arising from revenues from projects, ₹ 1,285.43 lakhs was arising from other operating revenues and other income of ₹ 648.11 lakhs. Revenue from operations Revenues from projects The revenue from projects was primarily on account of revenues received from annuity and toll Road Projects and our operating port projects. Out of our revenues from projects, annuity income was ₹ 20,842.00 lakhs and the toll revenue was ₹ 9,627.11 lakhs. The revenue from port operations was ₹ 8,630.50 lakhs. The revenue from developer activities was ₹2,216.92 lakhs. The developer activities for the year were significantly lesser in some of the projects. The revenue from road maintenance was ₹ 1,523.07 lakhs. Other operating revenue The other operating revenue of ₹ 1,285.43 lakhs primarily consists of operating grant received of ₹ 1,053.85 lakhs from NHAI and ₹ 28.04 lakhs which was the income from change of scope. Other income The other income consists of ₹ 648.11 lakhs which consists of interest income of ₹ 332.63 lakhs and miscellaneous income of ₹ 315.47 lakhs. Expenses The total expense was ₹ 17,681.32 lakhs. Project Expenses The total project expense was ₹ 13,100.15 lakhs. This consisted of changes in inventory of materials used in maintenance activities. The opening stock of materials was ₹ 42.09 lakhs and the closing stock of materials was ₹ 626.50 lakhs. This includes works in progress expenses for EPC contracts. The sub-contracting expense was ₹ 3,864.12 lakhs incurred for repairs and maintenance activities on road, port and service contracts. The material handling systems maintenance expenses towards handling the equipment at the port and road projects was ₹ 1,494.40 lakhs. The port cargo handling expenses was ₹ 2,669.63 lakhs at our operating port project, while the royalty on the revenue was ₹ 411.73 lakhs at our operating port project. The periodic maintenance expenses of ₹ 3,753.13 lakhs was towards major maintenance activity that is required to be carried out at our operating road projects. The other expenses include power and fuel expenses of ₹ 392.95 lakhs and other project expenses of ₹ 1,098.59 lakhs. Employee benefit expenses The employee benefit expenses consist of ₹ 2,435.30 lakhs which primarily consists of salaries wages and bonus to employees, remuneration to directors and cost attributable towards the GIPL ESOP Scheme. Other expenses The other expenses of ₹ 2,145.87 lakhs includes professional and consultancy fee, insurance charges, directors fees and commission loss on sale of fixed assets, loss from joint venture, assets written off and provisions of doubtful debts. Of this the professional and consultancy fee was ₹ 540.16 lakhs.

Profit / (Loss) attributable to group shareholders (5,644.39)

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The assets written off were amounting to ₹ 32.72 lakhs and the loss on sale of fixed assets was ₹ 25.48 lakhs. The loss from joint venture was ₹ 186.48 lakhs on account of the losses incurred at our port project under Development Phase at Mumbai which includes all of such port project expenses including those required to be incurred by our joint venture partner. The provisions for doubtful debts, advances and bad debts was ₹ 200.08 lakhs includes provision for doubtful receivables for services rendered to a joint venture entity on termination of the joint venture agreement and provision for service tax input credits not available for set off. Finance Costs The finance costs were ₹ 21,902.87 lakhs. This was primarily on account of loans availed by our Company and the SPVs towards interest expense to banks, financial institutions and others which comprised of an amount of ₹ 21,332.31 lakhs. Other finance cost includes expenses towards upfront fees and other ancillary costs for procuring funding for our projects. Depreciation / amortization The depreciation/amortization was ₹ 11,956.02 lakhs. Tax expenses The net tax expense was ₹ 94.85 lakhs which includes a current tax is ₹ 338.14 lakhs, net deferred tax credit of ₹ 111.37 lakhs and MAT credit entitlement of ₹ 229.25 lakhs. Short provision for earlier years of ₹ 97.32 lakhs has also been provided. Year ended March 31, 2013 compared to year ended March 31, 2012 Total income The total income for the year ended March 31, 2012 was ₹ 42,937.53 lakhs which increased by 62.59% to ₹ 69,813.92 lakhs for the year ended March 31, 2013. Revenue from operations Revenue from projects The revenue from projects has increased by 65.89% from ₹ 39,917.10 lakhs for the year ended March 31, 2012 to ₹ 66,219.35 lakhs for the year ended March 31, 2013. The increase is primarily on account of increase in developer fees, receipt of annuities on projects commissioned during the year and toll revenue. Out of our revenues from projects, our annuity income increased by 138.87% from ₹ 12,566.65 lakhs for the year ended March 31, 2012 to ₹ 30,018.09 lakhs for the year ended March 31, 2013. This was primarily due to receipt of annuities on projects commissioned during the year for two of our projects. Our toll revenue was ₹ 10,110.26 lakhs for the year ended March 31, 2012 which increased to ₹ 13,396.11 lakhs for the year ended March 31, 2013, showing an increase of 32.50%. This was mainly on account of (i) revision of toll rates for our toll road project which happens every year in July; and (ii) commissioning of the toll road for the full year as against partial commissioning in the previous year for 5 months. Our revenues from port operations was ₹ 12,490.26 lakhs for the year ended March 31, 2012 as compared to ₹ 13,508.98 lakhs for the year ended March 31, 2013 showing an increase of 8.16%. The revenue from developer activities was ₹ 2,462.38 lakhs for the year ended March 31, 2012 as compared to ₹ 6,767.77 lakhs for the year ended March 31, 2013 showing an increase of 174.85% attributed towards development activities in five road projects. Other operating revenue Our other operating revenue increased by 18.58% from ₹ 2,376.75 lakhs for the year ended March 31, 2012 to ₹ 2,818.32 lakhs for the year ended March 31, 2013. This was primarily on account of operating grant received of ₹ 2,062.02 lakhs by our road project in the year ended March 31, 2013. The income from the change in scope for the year ended March 31, 2013 was ₹ 385.29 lakhs while there was no such income received by us for the year ended March 31, 2012.

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Other income The other income increased by 20.59% from ₹ 643.68 lakhs for the year ended March 31, 2012 to ₹ 776.25 lakhs for the year ended March 31, 2013. This was primarily on account of increase in interest in fixed deposits with the banks. Expenses The total expenses increased by 7.95% from ₹ 20,660.21 lakhs for the year ended March 31, 2012 to ₹ 22,301.79 lakhs for the year ended March 31, 2013. Project expenses The total project expenses increased by 20.92% from ₹ 13,743.92 lakhs for the year end March 31, 2012 to ₹ 16,619.46 lakhs for the year end March 31, 2013. The total project expenses have increased primarily owing to periodic maintenance provisions, increase cargo handling expenses and other project expenses. The sub-contracting expenses have increased by 5.73% from ₹ 3,337.00 lakhs for the year end March 31, 2012 to ₹ 3,528.14 lakhs for the year end March 31, 2013. This is primarily due to increase in cost of labour. The port cargo handling expenses increased by 17.75% from ₹ 4,000.59 lakhs for the year end March 31, 2012 to ₹ 4,710.88 lakhs for the year end March 31, 2013. This is primarily due to an increase in quantity of cargo handled and increase in the rates of handling cargo from November 2012 onwards. The periodic maintenance expenses have increased by 56.63% from ₹ 2,821.03 lakhs for the year end March 31, 2012 to ₹ 4,418.70 lakhs for the year end March 31, 2013. This is primarily due to increase in commencement of operations of one of our road project and consequent expenses towards maintenance. Employee benefit expenses The employee benefit expenses have increased by 12.66% from ₹ 2,567.56 lakhs for the year ended March 31, 2012 to ₹ 2,892.54 lakhs for the year ended March 31, 2013. This is primarily due to increase in the number of employees and annual increments. Other expenses

The other expenses have decreased by 17.42% from ₹ 3,378.26 lakhs for the year ended March 31, 2012 to ₹ 2,789.79 lakhs for the year ended March 31, 2013. This was primarily due to a one time write off of the losses (in the year ended March 31, 2012) from the divestment of our entire stake in a joint venture company which was executing bio-mass power projects. The assets written off decreased by 1.88% from ₹ 101.05 lakhs for the year ended March 31, 2012 to ₹ 99.15 lakhs for the year ended March 31, 2013. The loss on sale of assets increased by 73.61% from ₹ 33.76 lakhs for the year ended March 31, 2012 to ₹ 58.61 lakhs for the year ended March 31, 2013. This was primarily due to sale of equipment at Mumbai Port Project. The provisions for diminution in value of investments and doubtful debts, advances & bad debts has reduced by 98.78% from ₹ 374.45 lakhs for the year end March 31, 2012 to ₹ 4.58 lakhs for the year end March 31, 2013. This was primarily due to provisions made for diminution in value of investments including goodwill and doubtful debt for the year ended March 31, 2012. Finance Costs The finance costs increased by 90.69% from ₹ 15,565.94 lakhs for the year end March 31, 2012 to ₹ 29,683.38 lakhs for the year end March 31, 2013. This was primarily due to charging of full year interest to the profit and loss account instead of capitalizing it on commencement of operations of a road project and the commencement of operations from April 2013 of another road project during the year ended March 31, 2013.

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Depreciation and Amortization Expenses Depreciation and amortization expenses increased by 106.49% from ₹ 7,789.92 lakhs for the year end March 31, 2012 to ₹ 16,085.22 lakhs for the year end March 31, 2013. This was primarily due to charging of full year interest to the profit and loss account instead of capitalizing it on commencement of operations of a road project and the commencement of operations from April 2013 of another road project during the year ended March 31, 2013. Tax expenses The tax expenses has declined by 164.13% from ₹ 1,152.56 lakhs in the year end March 31, 2012 to a credit of ₹ 739.11 lakhs in the year end March 31, 2013 due to recognition of deferred tax asset by our operating toll road project, required to be done so as per the principles of accounting standards. The current tax increased from ₹ 1,333.89 lakhs in the year end March 31, 2012 to ₹ 3,032.97 lakhs in the year end March 31, 2013. The deferred tax credit increased from ₹ 9.94 lakhs in the year end March 31, 2012 to ₹ 3,301.90 lakhs in the year end March 31, 2013. The MAT credit entitlement increased from ₹ 171.40 lakhs in the year end March 31, 2012 to ₹ 486.96 lakhs in the year end March 31, 2013. Liquidity and Capital Resources Our projects require extensive capital and we have historically financed our projects and other capital expenditures through a combination of cash generated from operations, sale of equity interests, borrowings from commercial banks and financial institutions and securitization of future cash flows. In connection with some of our projects, we are obligated to pay certain amounts to the respective granting authorities pursuant to our contractual arrangements. Our funding activities are conducted within corporate policies designed to enhance investment returns while maintaining appropriate liquidity for our requirements. In addition, in connection with our projects under implementation and development, we have entered into, and expect to continue to enter into, contracts for the procurement of equipment and services pursuant to which our Company and our subsidiaries are subject to significant capital commitments. Short Term Liquidity Our short-term liquidity requirements relate to servicing our debt and funding working capital requirements. Sources of short-term liquidity include cash balances and receipts from our operations and working capital loans. Long Term Liquidity Our long-term liquidity requirements include partial funding of our investments in new projects, funding our equity investments in our SPVs and joint venture companies and repayment of long-term debt under our credit facilities and, if required, any credit facilities guaranteed by us. Sources of funding our long-term liquidity requirements include new loans and equity or debt issues, including the issuance of shares by our subsidiaries or companies that we own interests in. We have in the past relied principally on cash flow from operations, borrowings from banks, equity and equity-linked financings, and granting security over our future cash flows as our main sources of funds. As of June 30, 2014, we had current cash and bank balances of ₹3,878.94 lakhs, which may not be freely available for us to meet our obligations, including capital expenditure obligations. Further, we also had total current investments of ₹ 4,288.80 lakhs. Our principal uses of cash have been, and are expected to continue to be, for construction and development costs of our projects, repayment of long-term borrowings under our credit facilities and the payment of government concession fees. The long term borrowings as of June 30, 2014 was ₹ 3,66,397.32 lakhs. The following table presents our cash flow data for Financial Year ending March 31, 2012, March 31, 2013 and for the nine month period ended December 31, 2013.

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(₹ in lakhs) Particulars March 31, 2012 March 31, 2013 December 31,

2013 Cash flow from operating activities 25,893.57 36,097.50 40,799.29 Cash flow from/(used) in investment activities (100,295.63) (60,856.56) (40,920.30) Cash flow from financing activities 84,605.04 8,472.23 1,964.92 Net increase / (decrease) in cash and cash equivalents

10,202.98 (16,286.84) 1,843.91

Cash and cash equivalents, end of the year / period 25,119.56 6,924.96 8,768.87 Cash and cash equivalents, beginning of the year / period

14,916.59 23,211.80 6,924.96

Cash Flow Data Net Cash Flow from Operating Activities The net cash flow from operating activities was ₹ 40,799.29 lakhs for the nine months period ended December 31, 2013 consisting of operating profit before working capital changes of ₹ 31,944.11 lakhs adjusted for amount realized from trade and other receivables of ₹ 9,376.96 lakhs, amount invested towards inventories of ₹ 522.62 lakhs, increase in trade payables and working capital finance of ₹ 1,903.77 lakhs and direct taxes paid of ₹ 1,902.93 lakhs. The net cash flow from operating activities was ₹ 36,097.50 lakhs for the year ended March 31, 2013 consisting of operating profit before working capital changes of ₹ 51,446.47 lakhs adjusted for increase in trade and other receivables of ₹ 11,715.14 lakhs, amount invested towards inventories of ₹ 280.53 lakhs, decrease in trade payables and working capital finance by ₹ 319.16 lakhs and direct tax paid of ₹ 2,813.65 lakhs and cash compensation of ₹ 220.50 lakhs paid to employees. The net cash flow from operating activities was ₹ 25,893.57 lakhs for the year ended March 31, 2012 consisting of operating profit before working capital changes of ₹ 26,336.84 lakhs adjusted for amount increase in trade and other receivables of ₹ 1,646.73 lakhs, towards utilisation of inventory of ₹ 426.34 lakhs, increase in trade payables and working capital finance of ₹2,494.16 lakhs and direct tax paid of ₹ 1,717.04 lakhs. Net Cash Flow Used in Investing Activities Net cash used in investing activities was ₹ 40,920.30 lakhs for the nine months period ended December 31, 2013 which was pursuant to capital purchases after adjusting capital creditors of ₹ 35, 312.30 lakhs, proceeds on sale of fixed assets ₹ 122.82 lakhs, investments made in mutual funds of ₹ 50,238.50 lakhs, sale of investments in mutual funds of ₹ 48,761.38 lakhs, the net intercorporate deposits granted was ₹ 2,086.85 lakhs, payment made towards debt service reserve amounting to ₹ 735.00 lakhs as per the requirements of the financing agreements between our SPVs and its lenders, amount paid to minority shareholders of ₹ 1,297.20 lakhs for acquiring equity stake from them in one of the SPV, amount paid for acquisition of stake in a joint venture SPV of ₹ 384.13 lakhs and interest received of ₹ 246.47 lakhs. Net cash used in investing activities was ₹ 60,856.56 lakhs for the year ended March 31, 2013 which was pursuant to capital purchases after adjusting capital creditors of ₹ 59,857.47 lakhs, proceeds on sale of fixed assets ₹ 153.43 lakhs, investments made in mutual funds of ₹ 29,793.29 lakhs, sale of investments in mutual funds of ₹ 29.771.57 lakhs, inter-corporate deposits granted of ₹ 4,934.91 lakhs, refunds received against intercorporate deposits ₹ 4,489.27 lakhs, advance of ₹ 625.08 lakhs given to joint venture companies, advance of ₹ 1,347.94 lakhs paid for acquisition of stake in subsidiary, investments made by minority shareholders in the group SPVs of ₹ 490.00 lakhs, disposal of stake in a joint venture SPV of ₹ 425.79 lakhs and interest received ₹ 372.07 lakhs. Net cash used in investing activities was ₹ 1,00,295.63 lakhs for the year ended March 31, 2012 which was pursuant to capital purchases after adjusting capital creditors of ₹ 98,227.75 lakhs, proceeds on sale of fixed assets ₹ 1.86 lakhs, investments made in mutual funds of ₹ 52,399.27 lakhs, sale of investments in mutual funds of ₹ 52,637.97 lakhs, sale of market investments of ₹ 378.27 lakhs, inter-corporate deposits given of ₹ 251.00 lakhs, refunds received against intercorporate deposits of ₹ 150.00 lakhs, advance of ₹ 770.45 lakhs received from a joint venture company, amount of ₹ 3,700.30 lakhs paid to minority shareholder for acquiring

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equity stake from them in one of the SPV, amount received ₹ 8.65 lakhs on disposal of stake in an SPV and interest received of ₹ 335.50 lakhs. Net Cash Flow from Financing Activities Net cash flow from financing activities was ₹ 1,964.92 lakhs for the nine months period ended December 31, 2013 which was pursuant to proceeds from borrowings of ₹ 50,957.19 lakhs.We have repaid loan instalments amounting to ₹ 28,143.68 lakhs, paid interest of ₹ 20,471.64 lakhs and has also paid dividend of ₹ 376.96 lakhs. Net cash flow from financing activities was ₹ 8,472.23 lakhs for the year ended March 31, 2013 which was due to capital grant received during the year of ₹ 1,825.00 lakhs, proceeds from borrowings of ₹ 1,21,705.28 lakhs. We have repaid loan instalments amounting to ₹ 82,680.14 lakhs, acquisitions of equity stake of ₹ 1,716.37 lakhs in a road project SPV from a minority shareholder. During the year we have paid interest of ₹ 30,647.16 lakhs and incurred ₹ 14.37 lakhs towards preliminary and share issue expenses for increasing authorized share capital and / or allotting equity shares of SPV. Net cash flow from financing activities was ₹ 84,605.04 lakhs for the year ended March 31, 2012 which was due to proceeds from issue of share capital of ₹ 3.00 lakhs, which was received by us on exercise of ESOPs granted to the employees, capital grant received during the year of ₹ 8,769.90 lakhs. During the year proceeds from borrowings were ₹ 1,75,250.57 lakhs, repaid loan instalments amounting to ₹ 87,954.81 lakhs, disposed equity stake to minority shareholder of ₹ 3,492.74 lakhs in a road project SPV, paid interest for the year of ₹ 14,734.78 lakhs, and incurred ₹ 221.57 lakhs towards preliminary and share issue expenses incurred for increasing authorized share capital and / or allocating equity shares of SPVs. Capital Expenditures Our net capital expenditure consisting of net tangible assets, net intangible assets, capital work in progress and intangible assets under development were ₹ 4,14,322.80 lakhs, ₹ 4,61,543.07 lakhs and ₹ 4,89,858.47 lakhs as at March 31, 2012, March 31, 2013 and as at December 31, 2013. Contractual Obligations and Commitments The following table sets forth our contractual obligations and commitments to make future payments as of June 30, 2014 towards our major projects under development:

(₹ in lakhs)

Name of Company Project Cost(1) 

Incurred till June 30, 2014 Commitme

nt 

   Intangible

Assets under Development 

Tangible / Intangible Assets 

Capital Advances 

Others   

PBHL  1,50,727.00 6,305.71 2.21 5,500.00 309.63  1,38,609.45

VGRPPL  2,08,700.00 3,821.88 7.01 4,991.85 1,99,879.26

SSRPL  1,09,416.00 11,894.77 5.97 14,625.00 -  82,890.26

SHPVL  49,644.00 7,490.10 1,899.53 - -  40,254.37

PHPL   1,00,345.00 92,231.31 17.75 - -  8,095.94

PREL   24,907.00 23,246.85 5.62 95.72 -  1,558.81

RGBL   1,07,002.00 91,483.55 20.09 99.72 -  15,398.64

ICTPL Total  1,23,300.00 55,450.04 2,695.12 1,332.09 63,822.75

ICTPL Share of GIPL @ 50%  61,650.00 27,725.02 1,347.56 666.05 31,911.37

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(1) Project cost represents the amount capitalized as gross intangible assets. Indebtedness To fund our capital expenditure and working capital requirements, we have entered into long-term and short-term credit facilities. Our borrowings are in Indian Rupees and are principally used to finance our requirements across the various projects we undertake. As of June 30, 2014, our outstanding total borrowings was ₹ 4,22,758.43 lakhs, which include long-term borrowings of ₹ 3,66,397.32 lakhs, short-term borrowings of ₹ 7,254.22 lakhs and current maturities of long-term borrowings of ₹49,106.89 lakhs. The following table shows the break-up of our consolidated indebtedness.

(₹ in lakhs) Sr. No.

Company (A) (B) (C) (D) = A+B+C Long Term Borrowings

Current maturities of Long term borrowings

Short Term Borrowings

Total debt

1 GIPL 36,410.06 20,917.50 7,254.22 64,581.78 2 AEL 7,659.21 1,355.10 - 9,014.31 3 AIIPL 3,839.99 - - 3,839.99 4 BBHPL 608.03 - - 608.03 5 CBICL 831.00 183.11 581.65 1,595.76 6 CICPL 859.88 - - 859.88 7 EIPPL 1,634.58 - - 1,634.588 GLL - - 149.04 149.04 9 GPDL - - 60.46 60.46 10 GREIPL - - 511.20 511.20 11 GRIL 175.10 - - 175.10 12 GREPL - - 8.98 8.98 13 GICL 66,633.58 3,600.00 - 70,233.58 14 KBICL 29,378.05 2,217.00 - 31,595.05 15 MNEL 71,353.73 5,675.00 - 77,028.73 16 MTL 177.07 - - 177.07 17 PBHL 2,731.71 4,433.58 - 7,165.2918 PHL 5,847.55 - - 5,847.55 19 PHPL 88,052.08 2,766.42 - 90,818.50 20 PREL 19,524.17 1,067.00 - 20,591.17 21 RCTPL 73.14 - - 73.14 22 REL 8,557.19 1,508.34 - 10,065.53 23 RGBL 55,267.79 1,274.00 - 56,541.79 24 SREPL - - 47.36 47.36 25 SHPVL 3,159.48 - - 3,159.48 26 SIPPL 360.02 - - 360.02 27 SSRPL 15,639.07 - - 15,639.07 28 THPL 162.96 - - 162.96 29 VGRPPL 7,796.18 - - 7,796.18 30 VSPL 27,268.73 1,340.13 - 28,608.86 31 YMMPL - - 7.30 7.30 32 YPHPL 914.46 - - 914.46 33 YPVL 5,718.60 - - 5,718.60 34 ICTPL 41,189.25 5,539.43 1,854.51 48,583.19

Total 501,822.66 51,876.61 10,474.72 564,173.99 Consolidation adjustments

including inter-company elimination

135,425.34 2,769.72 3220.50 141,415.56

Consolidated debt as per Unaudited Consolidated Interim Condensed Financial Statements

366,397.32 49,106.89 7,254.22 422,758.43

Interest Coverage Ratio

(₹ in lakhs) 12 months ended

March 2012 12 months ended

March 2013 9 months ended December 2013

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A Profit / (Loss) after

Tax (2,204.47) 2,486.37 (5,580.93)

B Depreciation / Amortisation 7,789.92 16,085.22 11,956.02

C Cash profits (A+B) 5,585.45 18,571.59 6,375.09

D Finance costs 15,565.94 29,683.38 21,902.87

(C+D)/D Interest coverage

ratio 1.36 1.63 1.29 Contingent Liabilities As of June 30, 2014, we had the following contingent liabilities as per the notes to our consolidated Financial Statements (as per ‘Accounting Standards 29 – Provisions, Contingent Liabilities and Contingent Assets’):

(₹ in lakhs)

Income-tax matters

Disputed statutory liabilities

Claims not acknowledged

Counter guarantees given to bankers Total

Total 7,651.56 1,777.00 1,380.51 38,441.77 49,250.84 Except as noted above and in our Financial Statements and notes thereto found elsewhere in this Placement Agreement, there are no other off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that we believe are material to Investors. Quantitative and Qualitative Disclosure about Market Risk Market risk is the risk of loss related to adverse changes in market prices, including interest rates and foreign exchange rates of financial instruments. We are exposed to various types of market risks in the normal course of business. These risks do not only affect us and our Subsidiaries but they may also affect the financial results of the companies in which we invest. The following discussion and analysis, which constitute “forward-looking statements” that involve risks and uncertainties, summarize our exposure to different market risks. Interest Rate Risk We and the companies in which we invest are subject to market risks due to fluctuations in interest rates and refinancing of short-term debt. Our net profit is affected by changes in interest rates due to the impact such changes have on interest income and interest expense from short-term deposits and other interest-bearing financial assets and liabilities. In addition, an increase in interest rate may adversely affect our ability to service long-term debt and to finance development of new projects, all of which in turn may adversely affect our results of operations. Inflation Inflation and deflation in India has not had a material impact on our results of operations during the periods for which financial information is presented in this Placement Document primarily as several of our concession agreements provide for a mechanism to appropriately adjust the tariff / pricing based on inflation. For example, our concession agreements entered into by VSPL and MNEL provide for adjustment of pricing based on inflation. The average annual WPI inflation rate (Base 2994-05=100) was 5.98% for Financial Year 2014. (Source: Office of the Economic Advisor)

Recent Developments Apart from the Financial Statements as at, and for the period nine months Financial Year ending on December 31, 2013 and twelve months Financial Years ended March 31, 2013 and 2012, our Company has also prepared Unaudited Consolidated Interim Condensed Financial Statements in accordance with the principles laid down in Accounting Standard 25 ‘Interim Financial Reporting’, notified pursuant to the Companies (Accounting Standards) Rules, 2006, (as amended) which were reviewed by our Audit Committee and approved by our

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Board on August 13, 2014 and was subjected to review by our Joint Auditors in accordance with Standard on Review Engagement (SRE) 2410, ‘Review of Interim Financial Information Performed by the Independent Auditor of the Entity’ issued by the Institute of Chartered Accountants of India and they have issued a review report dated August 13, 2014. Below are excerpts of the Unaudited Consolidated Interim Condensed Financial Statements which exclude the comparative figures as the said financials for the period ended June 2013 were unaudited and were not reviewed by our Joint Auditors, the complete set of which along with the Joint Auditors’ review report has been filed with the Stock Exchanges. 1. The Unaudited Consolidated Interim Condensed Financial Statements of the Company and its

subsidiaries, joint ventures and associates collectively the “Group”, which comprise of the interim consolidated condensed balance sheet as at June 30, 2014, and the interim consolidated condensed Statement of profit and loss and interim consolidated condensed cash flow statement for the six-month period then ended, and a summary of significant accounting policies and other explanatory information, are the responsibility of the Company’s Management and has been approved by the Board of Directors. The Joint Auditors responsibility is to express a conclusion on this Consolidated Statements based on their review.

2. SRE 2410 requires that the auditors plan and perform the review to obtain moderate assurance as to

whether the statement is free of material misstatement. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Standards on Auditing and consequently does not enable the Joint Auditors to obtain assurance that they would become aware of all significant matters that might be identified in an audit. Accordingly, the Joint Auditors do not express an audit opinion.

The Joint Auditors in their review report have qualified their conclusion on the Financial Statements to state that “one of the subsidiaries of the Company had issued a notice of intention to terminate the concession agreement with National Highways Authority of India (‘NHAI’) on mutual terms. The Company and NHAI are evaluating various alternatives for the project. The Group’s exposure to this project includes project expenses of Rs. 693,560,891 and guarantees of Rs. 564,600,000. As outcome of the matter is uncertain, the Joint Auditors are unable to determine the recoverability of said amount and consequential impact on the Unaudited Consolidated Interim Condensed Financial Statements”. The Joint Auditors had drawn attention to the following matters: a. The Group has incurred a consolidated net loss after tax of ₹ 6,115.78 lakhs for the six month period ended

June 30, 2014 and as of that date the Group’s current liabilities exceeded current assets by ₹ 66,975.83 lakhs. These conditions indicate the existence of an uncertainty as to timing and realisation of cash flow.

b. Attention is given to unilateral termination and closure of concessions for two projects, which are subject to pending litigations/arbitrations at various forums which may impact the carrying values of investments made in the projects. The Group’s exposure on these projects includes unamortised project cost and trade receivables of ₹ 3,187.03 lakhs and corporate guarantees and bid securities of ₹ 1,212.50 lakhs. Pending conclusion on these legal matters, no adjustments have been made in the Unaudited Consolidated Interim Condensed Financial Statements.

c. In relation to intention to exit one of the hydro power projects in Himachal Pradesh, one of the Company’s subsidiaries is seeking a claim of an amount against the amount spent on the project. The Company’s subsidiary has cited reasons for non-continuance on account of reasons beyond its control. The subsidiary is negotiating with its client for an amicable settlement on beneficial terms. The Group’s exposure on this project includes project expenses and unbilled receivables of ₹ 6,722.66 lakhs. Pending conclusion between the parties, no adjustments have been made in the Unaudited Consolidated Interim Condensed Financial Statements.

The Joint Auditors:

i. did not review the financial information of certain subsidiaries whose financial information reflect total assets of ₹ 1,58,432.95 lakhs as at June 30, 2014, total income of ₹ 6,716.92 lakhs and cash out flows

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of ₹ 1,010.65 lakhs for the six month ended period ended June 30, 2014 and certain associates, in which the Company’s share in the profit of such associates being ₹ 1.84 lakhs for the six month period ended June 30, 2014, in so far as it relates to the amounts included in Unaudited Consolidated Interim Condensed Financial Statements respect of these subsidiaries and associates are based solely on the reports of other auditors.

ii. did not review in respect of certain Joint Ventures whose financial information reflect total assets of ₹ 14.04 lakhs as at June 30, 2014 and total income of ₹ Nil for the period then ended, in which the Company’s share of such assets and income being ₹ 1.90 lakhs and ₹ Nil respectively and associates in which the Company’s share in the loss of such associates being ₹ 0.20 lakhs for the six month period ended June 30, 2014, and in so far as it relates to the amounts included in the Unaudited Consolidated Interim Condensed Financial Statements in respect of these Joint Ventures and associates is based solely on unaudited financial information as certified by the respective managements of the said entities.

SUMMARY OF UNAUDITED CONSOLIDATED INTERIM CONDENSED BALANCE SHEET AS AT JUNE 30, 2014

(₹ in lakhs) Particulars Amount Equity and liabilities Shareholders’ funds Share capital 14,761.55 Reserves and surplus 52,185.24 66,946.79 Minority interest 17,160.48 Non-current liabilities Long-term borrowings 366,397.32 Deferred tax liabilities (net) 335.15 Other long-term liabilities 88.50 Long-term provisions 7,014.76 373,835.74 Current liabilities Short-term borrowings 7,254.22 Trade payables, current 1,087.80 Other current liabilities 78,572.58 Short-term provisions 8,623.99 95,538.59 TOTAL 553,481.60

Assets Non-current assets Fixed assets : Tangible assets (net) 11,557.95 Intangible assets (net) 220,094.55 Capital work in progress 1,228.22 Intangible assets under development 260,014.60 Goodwill on consolidation 5,662.60 Deferred tax asset (net) 4,940.73 Non-current investments 81.23 Long-term loans and advances 18,460.45Non-current trade receivables 1,783.73 Other non-current assets 1,094.77 524,918.83 Current assets Current investments 4,288.80 Inventories 1,211.71 Trade receivables 6,473.55 Cash and cash equivalents 3,878.94 Short-term loans and advances 5,980.47 Other current assets 6,729.30 28,562.77

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TOTAL 553,481.60

SUMMARY OF UNAUDITED CONSOLIDATED INTERIM CONDENSED STATEMENT OF PROFIT & LOSS FOR THE 6 MONTHS PERIOD ENDED JUNE 30, 2014

(₹ in lakhs) Particulars Amount Income Income from operations: Income from projects 35,079.16 Other operating income 1,105.01 Other income 747.06 Total income 36,931.24 Expenses Project expenses 9,700.03 Employee benefits expenses 1,460.65 Other expenses 1,494.37 Exceptional items 3,797.37 Total expenses 16,452.43 Earnings before Interest, Tax, Depreciation and Amortisation (EBITDA)

20,478.81

Finance costs 13,951.66 Depreciation/amortisation 12,505.58 Share of (profit)/loss from investment in associates (1.48) Profit/(Loss) before tax (5,976.95) Less: Tax expenses Current tax 454.14 Deferred tax (credit)/charge (1,448.75) MAT credit written off 1,263.90 MAT credit entitlement (111.20) Short provision for earlier years (19.25) Net tax expense 138.83 Profit/(Loss) after tax (6,115.78) Less : Profit after tax attributable to minority interest 0.74 Profit / (Loss) attributable to group shareholders (6,116.52) Earnings per share (‘EPS’) (in Rupees) Basic (0.83) Diluted (0.83) Nominal value of equity share 2

SUMMARY OF UNAUDITED CONSOLIDATED INTERIM CONDENSED CASH FLOW STATEMENT FOR THE 6 MONTHS PERIOD ENDED JUNE 30, 2014

(₹ in lakhs) Particulars Amount

Cash flow from operating activities 24,310.47 Cash flow from investment activities (22,389.82) Cash flow from financing activities (6,810.57) Net increase / (decrease) in cash and cash equivalents (4,889.93) - Cash and cash equivalents, end of the period 3,878.94 Cash and cash equivalents, beginning of the period 8,768.87 Net increase / (decrease) in cash and cash equivalents (4,889.93)

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Notes: a. During the period, a subsidiary has received from National Highways Authority of India ('NHAI')

bonus of ₹ 6,734.44 lakhs which has been accounted as income from operations along with related expenditure.

b. PREL, a wholly owned subsidiary of the Company had filed a petition in the Bombay High Court for

approval of the scheme for its merger with the Company, has since been withdrawn. c. During the period, two subsidiaries namely BBHPL and YPHPL have terminated the contracts with

NHAI on mutually acceptable terms primarily due to non-availability of right of way to the site and environment and forest clearances. The exceptional items disclosed represent the write off of the expenditure incurred on these two projects.

d. During the period, the MPT has unilaterally sought to terminate with a subsidiary the concession

agreement for the project citing non-compliance with certain terms of the concession agreement. MPT also encashed the bid security bank guarantee for ₹ 200.00 lakhs despite the stay order issued by the District Court, Goa. The court has also passed stay order from carrying into effect the termination of the agreement. The subsidiary has taken further action in the matter including contempt petition. The Group’s exposure towards the project is ₹ 557.29 lakhs. Pending outcome of the legal proceedings, no adjustments have been made to the Unaudited Consolidated Interim Condensed Financial Statements. The management believes that it has a strong case in this matter.

e. As at June 30, 2014, the current liabilities exceed current assets by ₹ 66,975.83 lakhs (December 31,

2013 - ₹ 60,897.1 lakhs). The Group is taking various steps to meet its commitments, both, short term and long term in nature. The Group intends to monetise some of its mature assets, securitise some of its future receivables and raise funds through proposed equity offering through the proposed Qualified Institutions Placement. Based on detailed evaluation of the current situation, plans formulated and active discussions underway with various stakeholders, management is confident that the going concern assumption and the carrying values of the assets and liabilities in the Unaudited Consolidated Interim Condensed Financial Statements are appropriate.

f. One of the subsidiary company, had initiated correspondence with NHAI towards closure of its project

on mutually acceptable terms primarily due to non-availability of right of way to the site and forest clearances. In a recent meeting, NHAI has requested for evaluating various alternatives for the project. Contingent upon outcome of the discussions on compensation within the scope of concession agreement with NHAI and responses of the management of the Company, there might be review/reworking on the project parameters. The Group's exposure to this project includes project expenses of ₹ 6,935.61 lakhs and guarantees of ₹ 5,646.00 lakhs. Pending conclusion of the matter, no liability therefore has been provided in the accounts towards closure of the project. The Joint Auditors have modified their conclusion on this matter in their review report dated August 13, 2014 on the Unaudited Consolidated Interim Condensed Financial Statements prepared for the purposes of the proposed equity offering through the proposed Qualified Institutions Placement.

g. During the 6 months period ended June 30, 2014, the Greater Cochin Development Authority has

sought to end/obstruct the toll collection by a subsidiary by unilaterally sealing the toll booth. The subsidiary believes it has the right to collect toll at the bridge till April 27, 2020. Further necessary legal recourse is being initiated. The Group’s exposure includes trade receivables of ₹ 1,787.13 lakhs, unamortised project costs of ₹ 842.62 lakhs and corporate guarantee of ₹ 1,012.50 lakhs. Pending outcome of the legal proceeding, no adjustments have been made in the Unaudited Consolidated Interim Condensed Financial Statements. The management believes that it has a strong case in this matter.

h. During the 6 months period ended June 30, 2014, one of the subsidiaries which has a license to develop

a hydro power project in Himachal Pradesh has initiated correspondence with the State Government for exiting from the project primarily due to inability of the State Government in resolving the local agitations related to environmental issues because of which the subsidiary was forced to stop its geological studies at the project site. The subsidiary has paid an upfront premium of ₹ 5,285.25 lakhs to the State Government and the Group’s exposure towards the project excluding the upfront premium

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is ₹ 1,437.41 lakhs. The subsidiary has lodged a claim against the amounts spent on the project till date. The management believes that it has a strong case in this matter.

i. One of the subsidiaries has unabsorbed depreciation as per tax returns which are available for set off

against taxable income. The subsidiary has recognised the deferred tax asset credit estimating its future taxable income on the basis of the actual traffic plying on the road during the balance period of the concession which satisfies the test of virtual certainty supported by convincing evidence for recognising the deferred tax asset on the unabsorbed depreciation as per the tax returns. The subsidiary had obtained an independent expert's opinion about the satisfaction of the convincing evidence as required by “AS 22 - Accounting for Taxes on Income”. The deferred tax asset recognised amounts to ₹ 3,454.86 lakhs (December 2013 - ₹ 3,454.86 lakhs) on the unabsorbed depreciation as per the tax returns available for set off from future taxable income. During the period following the principle of prudence the subsidiary has not recognised further deferred tax asset on the unabsorbed depreciation.

j. The Central Board of Direct Taxes (CBDT), vide circular no. 09/2014 dated April 23, 2014, has

clarified that the cost of construction on development of infrastructure facility of roads/ highways under BOT projects is allowable as a deduction by amortizing and claiming the same as allowable business expenditure under the Companies Act. The amortization allowable is to be computed at the rate, which ensures that the whole of the cost incurred on creation of infrastructural facility of road/ highways is amortized evenly over the period of concessionaire agreement after excluding the time taken for creation of such facility. Due to this, during the period, two subsidiaries, has recognised the deferred tax asset amounting to ₹ 1,597.79 lakhs (December 2013 - Deferred Tax Liability ₹ 63.10) based on reasonable certainty.

k. During the 6 months period ended June 30, 2014, expenses on construction activity and developer fees

incurred by the operator on the project with the Group were considered as exchanged with the grantor against toll collection / annuity rights from such agreements and therefore the revenue from such contracts were considered realised by the Group and not eliminated for consolidation under “AS21 - Consolidated Financial Statements”. The revenue during the period from such contracts are not eliminated to the extent of ₹ 1,573.81 lakhs (June 30, 2013 - Rs. 2,887.02 lakhs).

l. Pursuant to supplementary agreement dated December 23, 2011 with the co-venturer in one of the Joint

Venture company, the Company is liable to bear and discharge all financial obligation and contribution in relation to the said Joint Venture. Hence the entire loss of the Joint Venture has been absorbed by the Group.

m. One of the subsidiaries undertaking the bridge project in Rajahmundry is in the process of getting its

loan restructured with its lenders. The aggregate amount of such facilities is ₹ 68,000.00 lakhs of which ₹ 54,791.79 lakhs is outstanding as at June 30, 2014. Further some of the SPVs undertaking a toll road project, a renewable co-generation power project and an off-shore container terminal berth project have submitted/are in the process of submission of revalidating/rescheduling proposal with their respective lenders.

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INDUSTRY OVERVIEW Unless otherwise indicated, the information in this section has been derived from various Indian government publications and industry reports, and has not been prepared or independently verified by us, the Book Running Lead Managers or any of our or their respective affiliates or advisors. The information may not be consistent with other information compiled within or outside India. Overview of the Indian Economy India, the world’s second largest country in terms of population (an estimated 1,236 million, as of July 2014), had an estimated GDP on a purchasing power parity basis of approximately U.S.$4,990 billion in 2013, making it the third largest economy by GDP after the United States, European Union and China. (Source: http://www.cia.gov/library/publications/the-world-factbook/geos/in.html) The outlook for the Indian economy has improved recently with cautiously positive business sentiments, improved consumer confidence, expectations of a modest recovery in growth and decline in inflation expectations. A moderate recovery is likely to set in 2014-15 broadly in line with the Reserve Bank’s indicated projections in January 2014. However, data revisions for previous quarters and the consequent changes in base effects impart uncertainty to the growth trajectory ahead. The pace of recovery, nevertheless, is likely to be modest. The recovery is likely to be supported by investment activity picking up due to part resolution of stalled projects and improved business and consumer confidence. Manufacturing PMI, for the month of February 2014, touched a year’s high on the back of higher output and new orders. The rural demand base is likely to shore up demand following record agricultural output. In addition, external demand is expected to improve further during 2014-15 stemming from encouraging prospects for global growth, notwithstanding some recent loss in export growth momentum. (Source: Monthly Economic Report, April 2014, http://indiainbusiness.nic.in/newdesign/upload/Publications/Monthly/2014/Monthly_April.pdf) The Government has in the past initiated a series of comprehensive structural reforms to promote economic stability and growth. The policy reforms initiated focused on implementing fundamental economic reforms, deregulating industry, accelerating foreign investment and promoting a privatization program for divestiture of public sector units. Although the economy has improved, India continues to trail behind other major economies with respect to its development of its infrastructure. Infrastructure Sector One of the major requirements for sustainable and inclusive economic growth is an extensive and efficient infrastructure network. Development of adequate infrastructure has been identified as the most critical prerequisite for sustaining the current growth momentum of the economy and to ensure inclusiveness of the growth process. The key to global competitiveness of the Indian economy lies in building a top of the line infrastructure. Economic incentives to be provided under the Budget 2014 – 15 - Infrastructure Infrastructure Implementation of 4P in India, an institutional to provide support to mainstream PPPPs called 4Pindia to be set up with a corpus of ₹ 50,000 lakhs. Shipping ₹ 11,63,500 lakhs will be allocated for the development of outer harbour project in Tuticorin for Phase I. SEZs will be developed in Kandla and JNPT. Comprehensive policy to be announced to promote Indian ship building industry. Inland Navigation Project on Ganges called ‘Jal Marg Vikas’ to be developed between Allahabad and Haldi.

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New Airports Scheme for development of new airports in Tier I and Tier II Cities to be launched. Road sector Sector needs huge amount of investment along with debottlenecking from maze of clearances. An investment of an amount of ₹ ₹ 37,88,000 lakhs in NHAI and state roads is proposed which includes 3,00,000 lakhs for the North East. Target of NH construction of 8500 km will be achieved in current financial year. Work on select expressways in parallel to the development of the industrial corridors will be initiated. For project preparation NHAI shall set aside a sum of ₹ 50,000 lakhs. Energy ₹ 10,000 lakhs is allocated for a new scheme “Ultra – Modern Super Critical Coal Based Thermal Power Technology”. Comprehensive measures for enhancing domestic coal production are being put in place. Adequate quantity of coal will be provided to power plants which are already commissioned or would be commissioned by March 2015. An exercise to rationalize coal linkages to optimize transport of coal and reduce cost of power is underway. New & Renewable Energy ₹ 50,000 lakhs provided for Ultra Mega Solar Power Projects in Rajasthan, Gujarat, Tamil Nadu, Andhra Pradesh and Ladakh. ₹ 40,000 lakhs provided for a scheme for solar power driven agricultural pump sets and water pumping stations. ₹ 10,000 lakhs provided for the development of 1MW Solar Parks in the banks of the canals. A Green Energy Corridor Project is being implemented to facilitate evacuation of renewable energy across the country. Petroleum and Natural Gas Production and exploitation of Coal Bed Methane reserves will be accelerated. Possibility of using modern technology to revive old or closed wells to be explored. Usage of PNG to be rapidly scaled up in a Mission mode. Proposal to develop pipelines using appropriate PPP models. Mining Changes, if necessary, in the MMDR Act, 1957 to be introduced to encourage investment in mining sector and promote sustainable mining practices. (Source: Key features of the Budget 2014 – 15 at http://indiabudget.nic.in/ub2014-15/bh/bh1.pdf) ROADS SECTOR IN INDIA Overview Road transport is considered to be one of the cost effective and preferred modes of transport for both freight and passengers. It is generally recognized that a well developed network of highways can result in lower vehicle operating costs (due to lower fuel consumption). It is estimated that the share of passenger traffic by road is more than 85% whereas freight traffic accounts for around 60% of the total freight transport. Easy availability, adaptability to individual needs and cost savings are some of the factors working in favour of road transport. Road transport also acts as a feeder service to railway, shipping and air traffic. (Source: Ministry of Road Transport and Highways Outcome Budget 2011-12 at http://www.performance.gov.in/sites/default/files/departments/road-transport/2011-12.pdf) According to the Planning Commission, a target of 1,835 billion tonne km has been put on road freight volumes for 2016-17, assuming growth at 8.7% per annum is in line with past trends. (Source: Planning Commission,

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Government of India.) India has one of the largest road networks in the world, consisting of: National highways; State highways; Major district roads; and Rural including other district roads. (Source: Planning Commission, Government of India.) The National highways constitute 1.7% of the entire network but carry 40% of the traffic on Indian roads. (Source: http://www.nhai.org/roadnetwork.htm) The state highways and major district roads together constitute the secondary system of road transportation which contributes significantly to the development of the rural economy and industrial growth of the country. The secondary system also carries about 40% of the total road traffic, although it constitutes about 13% of the total road length. At the tertiary level are the other district roads and the rural roads (Source: Planning Commission, Government of India.) Indian road network consists of: Length(In Km) Expressways 200

National Highways 79,243 State Highways 1,31,899

Major District Roads 4,67,763 Rural and Other Roads 26,50,000 Total Length 33 Lakh Kms (Approx)

(Source: http://www.nhai.org/roadnetwork.htm) Amongst other things, the main targets of the Twelfth Plan are as follows: In respect of the NHDP plan roads, to complete the majority of works by the end of the plan. For NHDP-V

specifically, which involves the conversion of the golden quadrilateral to six-lane roads, specific targets will be set for it throughout the Twelfth Plan period;

National and state Highways would be upgraded to a minimum two lane standard by the end of the Twelfth

Plan period; and All villages will be connected by all-weather roads by the end of the Twelfth Plan period. In addition to the current works, the Twelfth Plan also envisages on a comprehensive master plan for the development of 15,600 km of expressways in phases. It is expected that 1,000 km of the expressways would be completed during the Twelfth Plan period, while land for another 6,000km would be acquired to initiate work. (Source: Twelfth Five Year Plan 2012-2017, Volume II, Planning Commission, Government of India). Other Initiatives The Government has approved the special accelerated program for road development in the North- East (SARDP-NE), which aims to improve 4,099 km length of road by March 2015, 21.8% of which had been completed as on March 2012. Framework for highway infrastructure industry At the Central level, the Planning Commission in consultation with the Ministry of Road Transport and Highways and the Ministry of Rural Development prepares the overall policy, programme development and resource planning. National Highway Authority of India (“NHAI”) is the agency for implementation, operation and maintenance of national highways. NHAI was given the status of an autonomous corporate body under the control of the

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Ministry of Road Transport and Highway. However, the Central government, in view of national interests, has powers to divest NHAI of its responsibilities. At the state level, the overall policy, programme development and resource planning is done by the state planning cell in consultation with the central level planning commission and the state ministry of roads. State Public Works Department (“PWDs”) and road development corporations are implementing agencies at the state level implementing, operating and maintaining the state highways, major district roads and rural roads in few states. National Highways Authority of India The NHAI is an autonomous authority of the Government of India constituted by an Act of Parliament – The National Highways Authority of India Act, 1988 (“NHAI Act”). NHAI was operational from February, 1995, with the appointment of full time Chairman and other members. NHAI is responsible for the development, maintenance and management of national highways entrusted to it and for matters connected or incidental thereto. The functioning of NHAI is governed by NHAI Act and rules, and regulations framed thereunder. The main objects of NHAI are provided in NHAI Act as per which NHAI is responsible for the development, maintenance and management of the national highway. Its primary mandate is time and cost-bound implementation of the NHDP through a host of funding options, including tax revenues, fuel cess, Government borrowings, private participation and external multilateral agency contributions. It is also seeking active involvement of the private sector in financing the construction, maintenance and operation of national highways and wayside amenities. National Highways Development Project (“NHDP”) In 2000, the Government initiated the NHDP in an effort to improve road infrastructure. The ongoing NHDP involves a total of seven road construction phases (Phase I – VII), and at present, all the phases are undergoing implementation, except phase VI. The details and the latest status updates of the NHDP are as set out below:

NHDP as at June 30 2014 NHDP Total

Length

Already 4/6 Laned

Under Implementatio

n

Contracts Under Implementation

Balance length for award

(km) (No.) (km.) NS-EW Ph. I & II 7,142 6,305 420 45 417 Port Connectivity 380 379 1 1 0 NHDP Phase III 12,109 6,214 4,210 86 1,685 NHDP Phase IV 14,799 610 5,246 46 8,943 NHDP Phase V 6,500 1,869 2,212 27 2,419NHDP Phase VI 1,000 - - - 1,000 NHDP Phase VII 700 22 19 2 659

NHDP Total 42,630 15,399 12,108 207 15,123(Source: www.NHAI.org/WHATITIS.asp) State Highways The Twelfth Plan will encourage the states to develop a core road network. The development of both the four-lanes and two-lanes will be taken up as part of this Plan. Public private partnership would be encouraged through viability gap funding (“VGF”) window available with the Central Government. Targets for the Twelfth Plan as mentioned below: Targets for the Twelfth Plan State Highways Major District Roads

Kilometres % Of Existing / Total Length

Kilometres % Of Existing / Total Length

2-Laning 30,000 30 20,000 8.5

4-Laning 5,000 8 1,000 4

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Strengthening 41,500 25 66,500 25

IRQP 50,000 30 80,000 30

(Source: Twelfth Five Year Plan 2012-2017, Volume II, Planning Commission, Government of India) POWER SECTOR IN INDIA Background The Power Sector in India has grown during the last few decades in the field of generation, transmission, distribution. The installed generating capacity in the country has grown manifold to 249.49 GW at the end of June 2014. (Source: Monthly All India Installed Generation Capacity Report March 2014, Ministry of Power). Post-colonisation, the Government of India implemented the Indian Electricity Act 1910, the Electricity (Supply) Act, 1948 (the “Supply Act”) and the Electricity Regulatory Commissions Act, 1998 which together created the institutional framework under which the industry has developed. The Supply Act paved way for creation of the State Electricity Boards, which are state government agencies who have the sole responsibility for generation, transmission and distribution of electricity within each state. The smaller states and Union Territories established Electricity Departments, to manage and operate power systems. In May 2003, the Electricity Act, 2003 (the “Electricity Act”), was passed to resolve systemic deficiencies and to address the failures of the existing regime. Some of the important features of the Electricity Act included (a) license-free generation (b) creation of State Electricity Regulatory Commissions (“SERCs”) (c) provision of open access in transmission and distribution (T&D) (d) allowance of power trading and rural electrification. Under the Electricity Act, several states have restructured their boards into separate entities for generation, transmission and distribution, while others are attempting to privatise the former SEB entities. (Source: http://powermin.nic.in/indian_electricity_scenario/pdf/Historical%20Back%20Ground.pdf) Presently, the break up of the total installed capacity in the power sector is as follows:

Sector Megawatt Percentage State Sector 93,540.70 37.49 Central Sector 87622.99 35.12 Private Sector 68324.63 27.39 Total 2,49,488.31

(Source: Monthly All India Installed Generation Capacity Report – June 2014, http://cea.nic.in/reports/monthly/inst_capacity/jun14.pdf)

Fuel Megawatt Percentage Total Thermal 1,72,286.09 69.05 Coal 1,48,478.39 59.51 Gas 22,607.95 9.06 Diesel 1,199.75 0.48 Hydro (Renewable) 40,730.09 16.33 Nuclear 4,780.00 1.92 RES** (MNRE) 31,692.14 12.70 Total 2,49,488.31 100.00

Renewable Energy Sources(RES) include SHP, Solar, BP, U&I and Wind Energy, SHP= Small Hydro Project , BP= Biomass Power, and U & I=Urban & Industrial Waste Power, RES=Renewable Energy Sources (Source: Monthly All India Installed Generation Capacity Report – June 2014, http://cea.nic.in/reports/monthly/inst_capacity/jun14.pdf) Regulatory Overview The Electricity Act provides the statutory framework for the regulation of electricity in India. In India, control over the development of the power sector is shared between the central government and state governments, with the Ministry of Power as the highest authority governing the power industry. The CEA is a statutory body established by the Government under the Supply Act and continued under the Electricity Act. The CEA is the main technical advisor to both the government and the regulatory commissions and is responsible for formulating the National Electricity Plan, once every five years, in accordance with the National Electricity

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Policy. Further, the CEA is responsible for providing the techno-economic clearances for hydro- electric projects as well as being required to specify the technical standards and safety requirements for the construction, operation and maintenance of electrical plants and electrical lines. The CERC, which was constituted under the ERC Act, is an independent statutory body with quasi-judicial powers. The main functions of the CERC are to regulate the tariffs of generating companies, grant licenses for interstate transmission and trading and advise the Central Government in the formulation of the National Electricity Policy and the Tariff Policy. Additionally, the ERC Act established the SERC, a statutory body responsible for the determination of tariffs and grants of license at intrastate levels. The primary responsibilities of the SERC are to determine the tariff for the generation, supply, transmission and wheeling of electricity, whole sale, bulk or retail sale within the State, to issue licenses for intrastate transmission, distribution and trading and to promote co-generation and generation of electricity from renewal sources of energy. To date, 25 SERCs have been constituted and 14 have issued tariff orders to rationalize the tariffs. (Source: http://powermin.nic.in/gsb_servlets/internal.jsp#) Mechanism for Determination of Tariffs for Power Producers As per the Electricity Act 2003, tariffs can be determined based on section 62 or section 63 of the Electricity Act. On January 6, 2006, the Central government notified the National Tariff Policy (“NTP”) for the power sector in compliance with Section 3 of the Electricity Act and in continuation of the National Electricity Policy passed on February 12, 2005. The NTP stipulates that all future power requirements should be procured competitively by distribution licensees except in cases of expansion of existing projects or where there is a state controlled or state-owned developer involved, and where regulators will need to resort to the tariffs determination based on norms provided that expansion of generating capacity by private developers for this purpose would be restricted to one time addition of not more than 50% of the existing capacity. Under the NTP, even for public sector projects, tariffs for all new generation and transmission projects are decided on the basis of competitive bidding after a period of five years or when the Regulatory Commission is satisfied that the situation is ripe to introduce such competition. (Source: National Tariff Policy) The Guidelines for determination of tariff by bidding process for procurement of power by distribution licensees were issued on January 19, 2005, as amended, with the main objectives of promoting competitive procurement, facilitating transparency and fairness, reducing information asymmetry, protecting and providing flexibility to suppliers ensuring certainty on availability of power and tariffs for buyers. (Source: Competitive Bidding Guidelines: http://powermin.nic.in/whats_new/competitive_guidelines.htm) Fuel Supply Scenario Coal Supply Coal is the most important and abundant fossil fuel in India. It accounts for 55% of the country’s energy need. (Source: http://www.coal.nic.in/welcome.html). Gas Supply Indigenous production of natural gas in the country in financial year 2012 – 2013 was around 111 mmscmd. ONGC is India’s largest gas producing company, accounting for about 58%. Of the total domestic gas production in financial year 2012 – 2013. (Source: Allocation and Pricing of Gas, 19th report, Ministry of Petroleum and Natural Gas dated October 2013).

Year 2007 – 08 2008 – 09 2009 – 10 2010- 11 2011 -12 2012 – 13

Sale of Natural Gas by Producing Companies (in million metric tonnes)

26.974 27.063 40.831 46.042 41.025 34.359

(Source: Under the section Natural gas >Sales/consumption at http://ppac.org.in/)

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The Indian Power Sector Scenario Electricity generation by power utilities during 2013-14 was targeted to go up by 6.9% to 975 billion units. The growth in power generation during 2013-14 (April-March) was 6.0 %, as compared to 4.0% during April 2012 to March 2013 (Source: Economic Survey 2013 – 14 at http://indiabudget.nic.in/es2013-14/echap-11.pdf)

Power Generation by Utilities (Billion KWh) Note: #Includes generation from hydro stations above 25 MW (Source: Economic Survey 2013 – 14 at http://indiabudget.nic.in/es2013-14/echap-11.pdf) Power Deficit and Supply in India Power Deficit The Indian power sector has historically been characterized by high energy shortages. In the financial year 2013 – 2014, the peak energy deficit at a pan-India level is estimated to be at 4.5% and the base energy deficit is estimated to be 4.2% (http://cea.nic.in/reports/monthly/gm_div_rep/power_supply_position_rep/peak/Peak_2014_03.pdf and http://cea.nic.in/reports/monthly/gm_div_rep/power_supply_position_rep/energy/Energy_2014_03.pdf) Glance at Hydropower and Thermal Power Hydropower To meet the all India peak demand and energy requirement at the end of 12th Plan, a capacity addition of more than 90,000 MW has been assessed during Twelfth Plan, which includes 30,000 MW of hydro electric power. (Source: CEA: Report on Hydro Development Plan for 12th Plan (2012-17) at http://www.cea.nic.in/reports/hydro/hydro_develop_12th_plan.pdf). The energy generation from the hydro electric stations (excluding imports from Bhutan) showed remarkable performance in May 2014 with generation of 11.77 BU and achieving a growth rate of over 6% as compared to hydro generation of 11.025 BU during May 2013. During the period April to May 2014 the cumulative hydro generation was 21.553 BU against the 19.282 BU registering an achievement of 11.78%. (Source: CEA a thttp://cea.nic.in/reports/monthly/executive_rep/may14.pdf) Thermal Power During 2013-14 (April – March), growth in generation from coal, lignite, and gas-based stations was of the order of 8.3%, –0.3%, and –33.4% respectively. The overall plant load factor (PLF), a measure of efficiency of thermal power stations, during April 2013 to March 2014 declined to 65.55% as compared to a PLF of 70.13% achieved during April 2012 to March 2013. The sector-wise and region-wise break-ups of the PLF of thermal power stations from 2010-11 to 2013-14 show change over time as well as region. The PLF of state-sector utilities remained lower than that of private-sector and central-sector utilities. The energy deficit declined from 8.5% in the terminal year of the Eleventh Plan (2011-12) to 4.2% during 2013-14 and peak deficit from 10.6% to 4.5%. (Source: Economic Survey 2013 – 2014 at http://indiabudget.nic.in/es2013-14/echap-11.pdf) The Twelfth Plan has projected a total domestic energy production of 669.6 million tons of oil equivalent (MTOE) in 2016-17 and 844 MTOE in 2021-22. This will meet around 71% and 69% of expected energy consumption, with the balance to be met from imports, projected to be about 267.8 MTOE in 2016-17 and 375.6 MTOE in 2021-22. Import dependence in case of crude oil and coal is projected to be about 78% and 22%

Category April-March

2011-12 2012-13 2013-14 Growth (%) (2012-13 to 2013-14)

Power generation 876.89 912.06 967.15 6.04 Hydroelectric# 130.51 113.72 134.85 18.58 Thermal 708.81 760.68 792.48 4.18 Nuclear 32.29 32.87 34.27 4.14 Bhutan import 5.29 4.80 5.60 16.75

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respectively by 2016-17. Coal and lignite will continue to dominate the energy scenario and by 2021-22 the share of these two fuel products will be about 66.8% in total commercial energy produced and about 56.9% in total commercial energy supply by 2021-22. The share of crude oil in production and consumption is expected to be 6.7% and 23% respectively. Energy exploration and exploitation, capacity additions, clean energy alternatives, conservation, and energy sector reforms will, therefore, be critical for energy security. (Source: Economic Survey 2012 – 2013 at http://indiabudget.nic.in/) PORT SECTOR IN INDIA Introduction The ports and shipping industry plays a pivotal role in sustaining growth in trade and commerce and the overall development of the Indian economy. India currently ranks 16th among the maritime countries, having a long coastline of about 7,517 kilometres (km) with 13 major ports (12 government and one corporate) and about 200 non-major ports currently operating on the western and eastern coasts of the country. During 2013-14, Indian major ports handled 555.50 million tonnes (MT) of cargo as compared to 545.83 MT over the corresponding period in 2012-13, registering a growth of 1.80%. The state governments have realised the strong growth potential and the increasing need for robust port infrastructure, and have consequently provided sops and a favourable investment climate which are attracting investments from private players into the sector. Through its Maritime Agenda 2010-2020, the Ministry of Shipping has set a target capacity of over 3,130 MT by 2020, largely through private sector participation. More than 50% of this capacity is expected to be created at non-major ports. (Source: http://indiainbusiness.nic.in/newdesign/index.php?param=industryservices_landing/361/2,Last updated on July 30, 2014) Key Statistics The Indian ports sector received foreign direct investment (FDI) worth US$ 1,635.40 million between April 2000 and May 2014, according to the Department of Industrial Policy and Promotion (DIPP), Ministry of Commerce and Industry. (Source: http://indiainbusiness.nic.in/newdesign/index.php?param=industryservices_landing/361/2, last updated on July 30, 2014) Status of Capacity yielding Projects (PPP, Non-PPP & Captive) as on October, 2013 is as follows: 36 Public Private Partnership (PPP) projects are operational at a cost of ₹13,05,439.0 lakhs and

capacity of 195.33 MTPA. 34 PPP projects at an estimated cost of ₹ 11,23,057.0 lakhs and capacity 185.79 MTPA awarded and are

under implementation. 21 PPP projects with an estimated cost of ₹ 19,47,773.60 lakhs and capacity 212.06 MTPA have been

identified to be awarded during 2013-14. In addition, 7 non-PPP projects with the cost of ₹ 1,09,551.00 lakhs and capacity of 28.00 MTPA have been

awarded during the years 2013-14 so far, which are under various stages of completion. Some of the important projects completed during FY 2012-13

Mechanization of Berth CQ 3 (₹ 4,000.00 lakhs, 4.00 MTPA) completed on September 30, 2012 at Paradip.

Procurement of Mobile Harbour Cranes (₹ 1,900.00 lakhs, 2.80 MTPA) commissioned on October 31,

2012 at Cochin. (Source: Indian Ports Association, E- Magazine (Dec, 2013) http://ipa.nic.in/e-magazine.pdf)

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Traffic handled at major ports (in million tonnes) (*) TENTATIVE (IN ‘ 000 TONNES)

PORTS

APRIL TO MARCH % VARIATION

TRAFFIC AGAINST PREV.

2014* 2013 YEAR TRAFFIC

KOLKATA

Kolkata Dock System 12874 11844 8.70

Haldia Dock Complex 28511 28084 1.52

TOTAL: KOLKATA 41385 39928 3.60

PARADIP 68003 56552 20.20

VISAKHAPATNAM 58503 59038 -0.90

KAMARAJAR (ENNORE) 27337 17885 52.80

CHENNAI 51105 53404 -4.30

TUTICORIN 28642 28260 1.40

COCHIN 20887 19845 5.30

NEW MANGALORE 39365 37036 6.30

MORMUGAO 11739 17738 -33.80

MUMBAI 59184 58038 2.00

JNPT 62333 64488 -3.30

KANDLA 87005 93619 -7.10

TOTAL: 555488 545831 1.80

(Source: Ministry of Shipping, http://shipping.nic.in/showfile.php?lid=1713) Road Ahead The Ministry of Shipping through its Maritime Agenda 2010-2020 has set a target capacity of over 3,130 MT by 2020, largely through private sector participation. More than 50% of this capacity is expected to be created at non-major ports. The planning Commission of India in its 12th Five Year Plan expects a total investment of ₹ 1,80,62,600.00 lakhs (US$ 30.05 billion) in the ports sector. (Source: http://indiainbusiness.nic.in/newdesign/index.php?param=industryservices_landing/361/2,Last updated on July 30, 2014) Outlay and Expenditure for the Ports and Shipping Sector during the Five Year Plans (Rs in lakhs)

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(Source: http://ipa.nic.in/e-magazine.pdf)

Five Year Plan Port Sector Shipping Sector Outlay Expenditure Outlay Expenditure

I (1951 – 56) 3,700 2,800 2,600 1,900

II (1956 – 61) 4,500 3,300 4,800 5,300

III (1961 – 66) 8,600 9,300 5,70,000 4,000 Annual Plans 5,400 5,300 2,30,000 3,200

(1966 – 69)

IV (1969 – 74) 19,500 24,900 14,100 15,500

V (1974 – 79) 57,100 48,800 45,000 46,900

VI (1980 – 85) 64,700 76,500 75,500 44,400

VII (1985 – 90) 1,23,000 1,51,300 82,700 72,000

VIII (1992 – 97) 3,55,700 2,30,200 3,66,900 3,03,300

IX (1997- 02) 10,08,100 5,31,600 6,30,500 2,46,600

X (2002 – 07) 5,41,800 2,89,300 7,75,400 2,99,200

XI (2007 – 12) 30,30,500 6,94,800 15,02,600 9,78,800

XII (2012 – 17) 15,76,400 NA 10,14,200 NA

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BUSINESS OVERVIEW We were incorporated in April 2001 with a focus on participating in infrastructure project development undertaking PPP projects and other infrastructure projects involving private financial participation in various sectors on build operate transfer (BOT) and other allied basis. We are a part of the Gammon Group, which is a diversified business group with civil engineering and construction as its major business interests. GIL, our Promoter and the flagship company of the Gammon Group, is among the leading construction companies in India specialising in design and construction in the areas of transportation, engineering, industrial structures, energy projects, high rise structures, bulk storage facilities, foundation engineering, hydraulic works, irrigation projects and controlled demolition techniques. We operate as an infrastructure holding company with interests in sectors such as roads, ports and power through SPVs responsible for carrying on specific projects being undertaken by us. Our current portfolio of projects consists of 17 projects in the roads, ports and power sector, of which 6 projects have commenced commercial operations (“Operations Phase”), 8 projects have achieved Financial Closure or have achieved Financial Closure but are under revalidation and have commenced development or are in advanced stages to commence development (“Development Phase”) and 3 projects are in initial stages of project lifecycle and yet to achieve Financial Closure (“Pre-development Phase”). Our Company also undertakes services in other areas of project development, such as construction contracts, project advisory services, project management and operations and maintenance activities, which we provide to entities in our Group. Our key assets across the sectors as on date are set out below: Phases Roads Sector Ports Sector Power Sector

Operations Phase

1. Rajahmundry Expressway Annuity Road Project (kms. 200.00 to 253.00 on NH-5)

2. Andhra Expressway Annuity Road Project (Kms. 253.00 to 300.00 on NH-5)

3. Kosi Bridge Annuity Road Project (including approaches and bunds) (Kms. 155.00 to 165.00 on NH-57)

4. Gorakhpur Annuity Road Project (kms. 0.00 to 32.27 of Gorakhpur bypass on NH-28)

5. Mumbai Nasik Expressway Toll Road Project (kms. 539.50 to 440.00 on NH-3)

1. Visakhapatnam Port Project (operating 2 berths for multipurpose cargo handling)

Development Phase

1. Patna Highways Annuity Road Project (kms. 0.00 to 46.30 on NH-77 and 16.870 kms new bypass starting at km 46.300 on NH-77)

2. Rajahmundry Godavari Toll Road Project (kms. 82/40 to on EGK* road to 197/4 on NH-5)

1. Mumbai Off-shore Container Terminal Project

1. Pravara Co-generation Power Project (30 MW)

2. Rangit II Hydroelectric Power Project (66 MW)

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Phases Roads Sector Ports Sector Power Sector

3. Sidhi Singrauli Toll Road Project (Kms. 83/40 to 195/80 on NH-75E)

4. Vijayawada Gundugolanu Toll Road Project (kms. 1076.48 to 1022.48 on NH-5)

5. Patna Buxar Toll Road Project (kms. 0.00 to 124.85 on NH-30 including bypass section on NH-84)

Pre-Development Phase

1. Tidong Hydroelectric Power Project (60 MW)

2. Youngthangkhab Hydroelectric Power Project (261 MW)

3. Aparna Infraenergy Thermal Power Project (250 MW)

* Eluru-Gundugolanu-Kovvur (EGK) Our Road Business Our infrastructure projects under the road sector currently comprise of 10 projects, out of which 5 are in Operations Phase and 5 are under Development Phase. The following road projects are in the Operations Phase: Rajahmundry Expressway Annuity Road Project: strengthening of the existing 2 lanes and widening of the

same to 4 lane dual carriageway from kms. 200.00 to 253.00 (approximately 53 kms.) on the Rajahmundry – Dharmavaram section of NH-5 in the state of Andhra Pradesh, being developed and maintained by our SPV, REL, which commenced commercial operations on September 20, 2004;

Andhra Expressway Annuity Road Project: strengthening of the existing 2 lanes and widening thereof to 4

lane dual carriageway, from kms. 253.00 to 300.00 (approximately 47 kms.) on the Dharmavaram-Tuni section of NH-5 in the state of Andhra Pradesh, being developed and maintained by our SPV, AEL, which commenced commercial operations on October 30, 2004;

Kosi Bridge Annuity Road Project: designing, construction, financing, maintenance and operation of a 4 –

lane Bridge across the river Kosi (including its approaches and guide bund and afflux bund) from kms. 155.00 to 165.00 (designed chainage: kms. 148.550 to 159.185, approximately 10.635 kms.) on NH – 57 , in the State of Bihar and is being developed and maintained by our SPV, KBICL, which commenced commercial operations on February 8, 2012;

Gorakhpur Annuity Road Project: designing, construction, financing, maintenance and operation of a

bypass from kms. 0.00 to 32.27 (approximately 32.27kms.) on NH – 28, in Gorakhpur located in the state of Uttar Pradesh and is being developed and maintained by our SPV, GICL, which commenced commercial operations on March 31, 2012; and

Mumbai Nasik Expressway Toll Road Project: envisaging improvement, operation, maintenance,

rehabilitation and strengthening of the existing 2- lane road and widening the same to 4 –lane divided

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highway, from kms. 539.50 to 440.00 (approximately 99.50 kms.) on the Vadape – Gonde section of NH-3, located in the state of Maharashtra and is being developed and maintained by our SPV, MNEL, which commenced partial operations on May 11, 2010 and full operations on July 11, 2011. The final COD was achieved in June 2012.

The following roads projects are in the Development Phase: Patna Highways Annuity Road Project: upgradation of Hajipur-Muzzafarpur section of the existing NH-77

to four lane dual carriageway, from kms. 0.00 to 46.30 (approximately 46.30 kms.) and construction of 16.870 kms. New bypass starting at km. 46.300 and connecting NH-28 of East – West corridor at 515.045 kms. (total length approximately 63.371 kms.) on Patna-Muzzafarpur section of NH-77, in the state of Bihar, being developed and maintained by our SPV. PHPL, was supposed to commence commercial operations from August, 2014.

Rajahmundry Godavari Toll Road Project: designing, construction, financing, maintenance and operation of

a major bridge across river Godavari with approach roads starting at km 82.4 of Eluru-Gundugolanu-Kovvur road on Kovvur side joining NH-15 at km 197.4 on Rajahmundry side in the State of Andhra Pradesh being developed and maintained by our SPV, RGBL, which is expected to commence commercial operations in March, 2015;

Sidhi Singrauli Toll Road Project: augmentation of existing road by four laning of Sidhi – Singrauli section

on NH – 75E from kms. 83.4 to 195.8 (approximately 102.60 kms.), located in the State of Madhya Pradesh, being developed and maintained by our SPV, SSRPL, which is expected to commence its commercial operations within 730 days from the appointed date (i.e. September 19, 2013);

Vijayawada Gundugolanu Toll Road Project: augmentation of existing NH-5 by six laning of Vijayawada –

Gundugolanu section from kms. 1076.48 to 1022.48, including 6 lane Hanuman Junction by pass, (i.e. 6.72 kms.) and 4 – lane Vijayawada bypass (approximately 47.88 kms.) (total length approximately 103.59 kms.), located in the state of Andhra Pradesh, to be developed and maintained by our SPV, VGRPPL, which is expected to commence its commercial operations within 912 days from the appointed date (as defined under the concession agreement). The appointed date has been notified as September 1, 2014. Tolling operations at the two toll booths of Vijayawada Gundugolanu Toll Road Project has commenced with effect from September 1, 2014; and

Patna Buxar Toll Road Project: augmentation of existing road by four laning of the Patna-Buxar section on NH – 30 & NH - 84 from kms. 0.00 to 124.850 (total length approximately 125.443 kms.), located in the state of Bihar, proposed to be developed and maintained by our SPV, PBHL.

Our Port Business Our projects under the port sector currently comprises of 2 projects, out of which 1 is in its Operations Phase and 1 is under its Development Phase. The following port project is in its Operations Phase: Visakhapatnam Port Project: developed and maintained by our SPV, VSPL, operating two multipurpose

berths for handling coal, lime stone, rock phosphate, sulphur and other bulk cargo or general cargoes or liquid bulk cargo (non-hazardous) at Visakhapatnam port which commenced commercial operations on July 24, 2004 and September 8, 2005. Vide letter dated January 28, 2014, VPT has granted leasehold rights to VSPL on additional land admeasuring 30 acres for the purpose of storage and handling of cargo.

The following port project is in its Development Phase: Mumbai Port Project: operation and management including necessary developments, modifications and

augmentation of facilities, of the Ballard Pier Station Container Terminal and development, construction, operation and management of an off-shore container terminal in the Mumbai Harbour proposed to be developed, maintained and operated by our SPV, ICTPL, which is expected to commence commercial operations from January 31, 2016.

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Our Power Business Our projects under the power sector currently comprise of 5 projects, out of which 2 are in their Development Phase and 3 are in their Pre-development Phase. The following power projects are under Development Phase: Pravara Co-generation Power Project: development and operations of a 30 MW bagasse-based power co-

generation project in Pravara Nagar, Taluka Rahata, District Ahmednagar, Maharashtra, proposed to be developed and maintained by our SPV, PREL, which was supposed to commence the commercial operations from September 01, 2014; and

Rangit II Hydroelectric Project: development and operations of a 66 MW hydroelectric project on the

Rimbi river in West Sikkim, proposed to be developed and maintained by our SPV, SHPVL, which is expected to commence from December 8, 2015 as per the letter received from Government of Sikkim dated February 10, 2010. However, the Company expects the commercial operations to commence within 3 years from the date of first disbursement of the debt component from the lenders.

The following power projects are under the Pre-Development Phase: Tidong Hydroelectric Power Project: a 60 MW hydroelectric project in District Kinnaur in Himachal

Pradesh on the river Tidong (a tributary of river Satluj), proposed to be developed and maintained by our SPV, THPL;

Youngthangkhab Hydroelectric Project: a 261 MW hydroelectric power project in District Kinnaur on the

Spiti/Satluj river in the state of Himachal Pradesh proposed to be developed and maintained by our SPV, YPVL; and

Aparna Infraenergy Thermal Power Project, a 250 MW coal based thermal power project, in Mauza-

Kawthala, Taluka Chimur, District Chandrapur, Maharashtra, proposed to be developed and maintained by our SPV, AIIPL.

Our EPC Business Our Company has ventured into undertaking EPC business by way of project monitoring through sub-contracting route for its own projects awarded by NHAI and other state road development authorities. This route allows our Company to leverage its management expertise thereby achieving efficient margins and de-risking contractual hurdles. Currently, our Company is undertaking EPC works in for two of our Subsidiaries, VGRPL and SSRPL.

For the risks related to our aforesaid projects, please refer to section titled “Risk Factors” on page 49. On a consolidated basis, our total income for the Financial Year 2012-13 and the nine month period ending December 31, 2013 is ₹69,813.92 lakhs and ₹46,065.91 lakhs, respectively and our net profit / (loss) (being profits attributable to the Group shareholders) for the Financial Year 2012-13 and the nine month period ending December 31, 2013 is ₹1,472.63 lakhs and ₹ (5,644.39) lakhs, respectively. In accordance with the Unaudited Consolidated Interim Condensed Financial Statement as of and for the six months period ending June 30, 2014, our total income is ₹ 36,931.24 lakhs and our net profit / (loss) (being profits attributable to the Group shareholders) is ₹ (6,116.52) lakhs. RECENT DEVELOPMENTS Set out below are certain key developments that have taken place since the date of our last audited consolidated Financial Statements which was for a period of 9 months ending on December 31, 2013: Roads Sector

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Our SPV, YPHPL has entered into an agreement with NHAI on March 14, 2014, for the termination of concession agreement dated July 30, 2012, for four laning of the Uttar Pradesh-Haryana border on the Yamunanagar-Saha-Barwala-Panchkula section of NH – 73, in the State of Haryana, as YPHPL was unable to commence construction activities at the project site on account of non availability of land and certain government approvals. For more details, please refer to “Risk Factors” on page 49.

Our SPV, BBHPL has entered into an agreement with NHAI on March 28, 2014, for the termination of

concession agreement dated May 31, 2012, executed for the purpose of rehabilitation and upgradation of Birmitrapur – Barkote section of NH – 23, in the State of Orissa, as BBHPL was unable to commence construction activities at the project site on account of non availability of land and certain government approvals. For more details, please refer to “Risk Factors” on page 49.

Our SPV, PBHL has entered into a concession agreement with NHAI on February 02, 2012 and has

initiated discussions with NHAI for mutual termination of concession agreement executed for 4-laning of the Patna – Buxar stretch of NH-30 and 84, in the State of Bihar, as PBHL is unable to proceed with construction activities at the project site on account of non availability of land and certain government approvals. For more details, please refer to “Risk Factors” on page 51.

In relation to our SPV, PBHL, on August 30, 2014, NHAI encashed a sum of ₹1,129.11 lakhs, out of the

performance bank guarantee of Rs.5646 lakhs due to default of the due and faithful fulfilment and compliance with the terms and conditions contained in the concession agreement. We intend to contest the matter in an appropriate forum.

Our SPV, CBICL, operating the Cochin Bridge Project was obstructed from collecting toll at the Cochin

Bridge Project by the Greater Cochin Development Authority on April 27, 2014 by unilaterally sealing the toll booth. For details please refer to “Legal Proceedings” and “Risk Factors” on pages 212 and 65 respectively.

Port Sector Our SPV, MTL has entered into a concession agreement with Mormugao Port Trust on January 18, 2013

for providing mechanized handling facilities for handling coal at berth no. 11 at Mormugao Port in the state of Goa. MTL and the Mormugao Port Trust were to satisfy all the conditions precedent by February 2014. However, due to a disagreement between the parties in relation to non-compliance of conditions precedent, Mormugao Port Trust has communicated that it is unilaterally terminating the concession agreement. Subsequently, MTL filed a suit for injunction and obtained a stay order on the termination of the concession agreement and the invocation of the bank guarantee of ₹ 200.00 lakhs. Further, despite the ad-interim stay order the bank guarantee has been invoked by Mormugao Port Trust. For more details, please refer to “Legal Proceedings” on page 214 and “Risk Factors” on page 50.

Power Sector In relation to our Youngthangkhab Hydroelectric Power Project, YPVL has initiated correspondence with

the GoHP for exiting from the Youngthangkhab Hydroelectric Power Project primarily due to inability of the GoHP in resolving the local agitations related to environmental issues because of which YPVL was forced to stop the geological studies. YPVL vide letter dated June 19, 2014 requested GoHP for mutual termination of the Youngthangkhab Hydroelectric Power Project and has also requested to re-imburse / refund an amount of ₹ 12,794.09 lakhs on account of losses (including the upfront premium, interest and expenses) incurred by YPVL. The GoHP is yet to respond to YPVL’s letter. For more details, please refer to “Risk Factors” on page 49.

OUR COMPETITIVE STRENGTHS We believe our principal strengths are as follows: Experience in Infrastructure Project Development We are an infrastructure projects development company undertaking projects at various stages in sectors such as roads, ports and power, which are the key drivers of the economy. We are one of the few Indian infrastructure companies with a presence across road, port and energy sectors. We presently derive our revenues from our road

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and port assets and are in the process of completing the construction of a power project. We will continue to focus on undertaking projects on a PPP basis. Our understanding of the infrastructure sector, specifically projects being undertaken under the PPP model, and in some cases experiences through the life cycle of each project, has enabled us to take decisions that are in the best interest of the Company. We have in AEL and REL developed substantial experience and expertise over the life cycle of the project, i.e. from project appraisal stage, bidding for the project, achieving Financial Closure, project management during construction phase and undertaking operations and maintenance of the project including major maintenance at five year intervals. Our early-mover advantage and continued focus in the infrastructure projects provide us with a platform to further develop our presence and diversify into other sectors in the infrastructure space. Our access to financing sources, potential partners and industry expertise enable us to identify and value new projects effectively, assess risks and compare evaluation results against our experience. We also provide O&M services for various projects, either directly or through the SPV itself, which helps us leverage the operating costs of such projects. Our experience has made us familiar with the risks associated with infrastructure projects in India, which has enabled us to negotiate agreements and execute our projects more effectively and efficiently. We regularly assess our projects and have, in the past, exited from projects that were proving to be or likely to be a drain on our resources. Project Portfolio Consisting of Both Assured and Market Driven Returns We have a good mix of assured and market driven returns, which we believe will help us prosper in the long run and offer us significant leverage in the infrastructure space. Our Rajahmundry Expressway Annuity Road Project, Andhra Expressway Annuity Road Project, Kosi Bridge Annuity Road Project and Gorakhpur Annuity Road Project are annuity road projects and have assured sources of revenue in the form of annuities payable by NHAI. Our Mumbai-Nashik Expressway Toll Project and Visakhapatnam Port Project are sources of market driven revenues. The toll charges on our road projects are subject to revision based on variation in the wholesale price index, as notified by the Government. For the nine month period ending December 31, 2013, our roads segment operated at a 47.23% – 21.81% mix of annuity revenue to toll revenue. Our projects under the Development Phase are also a prudent mix of assured and market driven revenue generating projects. Proven Track Record for Winning Bids and Efficient Execution of Projects We have a track record for winning projects and executing them successfully. Our access to financing sources, potential partners and industry expertise enable us to value new projects effectively, assess risks in a proper manner and benchmark our conclusions against our prior experience. We have also traditionally been successful in identifying and mitigating certain development and operation risks, which we believe is a source of competitive advantage for us. We have a track record in the successful development, execution and O&M of infrastructure projects. As of date, we have commissioned and have in operations 5 road projects and 1 port project. Our concession agreements, such as those entered into with REL, AEL, KBICL, GICL and PHPL, provide for bonus payments when the project is commissioned before the occurrence of the scheduled completion date of a project. We successfully commissioned Rajahmundry Expressway Annuity Road Project and Andhra Expressway Annuity Road Project 70 and 30 days, respectively, ahead of the scheduled completion date and have received bonus payments for the same. Our management team is highly experienced, with comprehensive expertise in the infrastructure sector. Many of our leaders have more than 15 years of experience in the infrastructure sector and have held senior positions in other infrastructure business, which, we believe, have given them with a holistic and interdisciplinary perspective on infrastructure business. Continuous Growth in our Bid Capacity and Pre Qualification Capability Our business and growth are significantly dependent on our ability to bid for and secure larger and more varied projects. Bidding for infrastructure projects is dependent on various criteria, including, bid capacity and pre qualification capability. Bid capacity represents the aggregate value of the contracts that can be awarded to us, and is computed based on pre defined formulae of agencies such as the NHAI, etc. Bid capacity also includes the highest possible value of a single project that can be awarded to us. In addition to meeting bid capacity requirements, we may also be required to pre qualify for the projects. This includes past experience in the execution of similar projects, technical ability and performance, reputation for quality, safety standards,

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financial strength and the price competitiveness of the bid. Hence, it is imperative to enhance our bid capacity and pre qualification capability. We have focused on increasing both these parameters and have continuously increased our bid capacity and the largest order that we can bid for. Revenue Generation through Operations and Maintenance Services (“O&M”) We have been providing O & M services for the Rajahmundry Expressway Annuity Road Project and Andhra Expressway Annuity Road Project since the commissioning of these projects in September 2004 and October 2004, respectively. The Company receives fixed payments for these services, which has become an assured source of revenue for us. The Company successfully completed the first ‘periodic maintenance activity’ for these projects in financial year 2010, which is undertaken every 5th, 10th and 15th years as per the concession agreement. Further, we have been undertaking the O&M, for Mumbai Nasik Expressway Road Project, Kosi Bridge Annuity Road Project and Gorakhpur Annuity Road Project since their respective CODs. Thus, we have gained significant experience and expertise in O&M and have added this service as one of the fixed source of revenue generation. Project Portfolio Spread Across Three Different Sectors and Geographies Our projects are spread across the roads, ports and power sectors. Our road sector projects are Rajahmundry Expressway Annuity Road Project, Andhra Expressway Annuity Road Project, Gorakhpur Annuity Road Project, Mumbai Nasik Expressway Toll Road Project, Patna Highways Annuity Road Project, Rajahmundry Godavari Toll Road Project, Vijayawada Gundugolanu Toll Road Project, Sidhi Singrauli Toll Road Project, Patna Buxar Toll Road Project and Kosi Bridge Annuity Road Project. Our port sector projects are Visakhapatnam Port Project and Mumbai Off-shore Container Terminal Project. Our power sector projects are Pravara Co-generation Power Project, Tidong Hydroelectric Power Project, Youngthangkhab Hydroelectric Power Project, Aparna Infraenergy Project and Rangit II Hydroelectric power project. Further, these projects are geographically dispersed across 7 states in India. We believe that such sectoral and geographic diversity enables us to achieve operational flexibility, as well as, mitigate the risks in operating in specific sectors and geographical locations. Ability to Mobilise Financial Resources We believe that with our experience in raising capital (by way of debt and/or equity) through efficient structures in the financial markets, we are suitably poised to take advantage of future opportunities in the infrastructure sector. For example, under our Patna Highway Annuity Road Project, in terms of the concession agreement, we have achieved Financial Closure, at a debt to equity ratio of 90:10. Also, we have achieved loan tenures of 18 years for the Rajahmundry Godavari Toll Road Project. Further, out of our 8 projects in the Development Phase, 7 have achieved Financial Closure. As infrastructure project development on PPP basis is a highly capital-intensive business activity, we believe that our long term experience and expertise in the infrastructure sector coupled with our ability to understand the cash flow requirements of executing and managing such projects enable us to financially engineer our projects better and mobilise financial resources more efficiently than our competitors in the industry. We Benefit from the Gammon Brand, Which We Believe is Known for Reliability, Efficiency and Risk Control. We are the infrastructure arm of the Gammon Group. The Gammon Group has been operating in India for over 90 years in the fields of construction and infrastructure. Due to the long-standing history of the Gammon Group, we believe that the Gammon brand enjoys strong brand recognition in the infrastructure sector. Further, successful infrastructure development is dependent upon 2 major types of expertise: (i) project development, which includes appraisal, bidding, financing and project management; and (ii) engineering, procurement and construction. As a developer, although we have expertise in project management and execution, we derive significant synergies from the Gammon Group. We intend to continue to build upon our experience by drawing on the strong engineering and design capabilities of GIL, including technological advancements. Our Association with GIL has strengthened our competitive position. While we have the advantage of access to the construction skills and expertise of GIL, our promoter, we are free to award construction contracts for our projects to other contractors on competitive basis. This has helped us in getting competitive price for our construction contracts from our promoter as well as other players in the

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construction industry. OUR STRATEGY Leverage India’s Demand for Infrastructure Projects and Deliver We believe that the prospects for the infrastructure industry in India look positive with the Planning Commission of India recognizing the continued infrastructure deficit of India. We intend to continue to focus on moving our projects through the development cycle as efficiently as possible so that they become operational and commence contributing to our revenue. In our roads business, we will continue to bid for selective and profitable projects with a mix of assured and market linked returns. In our power business, we will continue to look for opportunities in the renewable energy space, including hydro projects. The 12th Plan (covering 2012 to 2017) envisages investment of US$1 trillion in infrastructure sector, which is double the investment over the previous eleventh 5 year plan. In addition, almost half of this investment is expected by the Planning Commission to come through the private sector. As the Indian economy continues to grow, our Company expects that India’s energy consumption will grow as well. Our Group intends to position ourselves to benefit from the growth of the power sector in India that is expected to add 88,000 MW of generation capacity during the 12th Plan (2012-2017). We believe this provides tremendous business potential for established and emerging infrastructure developers, such as us. Focus on Liquidity Management The last few years have been challenging for the infrastructure sector due to the lack of liquidity attributed to macroeconomic factors. The nature of our industry requires early stage project finance at a high cost. As we move to make our projects operational, we take steps to refinance the early high cost debts with lower cost debts. We have, in the past, refinanced our existing debts, rescheduled our debt repayments and repaid debts to improve our liquidity management. We adopted a pragmatic approach to navigate through the turbulent times the Industry passed in the recent past by reducing our overhead expenses and optimally stretching our available resources. We continue to pursue our recoveries from our clients which have been pending and also continue to take steps to reduce costs, improve operational efficiencies and improve cash flows. Continue to Identify Diverse Sectors and Geographies We are actively focused on becoming a diversified infrastructure player, sector wise and geographically. We are currently analysing a number of new potential projects in the infrastructure sectors in which we currently operate as well as new sectors such as water, waste water and railways, which will enhance and diversify our revenue sources. We intend to continue to pursue the advantages associated with early entry in specific infrastructure sectors in order to achieve a dominant position within such sectors and to realise specific advantages of higher margins. Further, we believe that our infrastructure assets should be geographically dispersed to mitigate effectively against geographical risks. Accordingly, we intend to diversify into other sectoral assets spread over various locations across India. We may also in the future, explore business opportunities for developing projects outside India, mainly in developing economies. Explore O&M Opportunities to External Projects We have gained substantial experience in managing, operating and maintaining infrastructure projects. We intend to offer fee-based O&M services for infrastructure projects developed by others. We expect substantial capacity enhancement and completion of infrastructure projects in India in the next few years, which may provide us with opportunities to enhance the scope and size of our O&M services, especially in the road sector. Monetising of SPVs through Divestments Our senior management based on a detailed analysis of the trends in the infrastructure sector has adopted a strategy to focus on maintaining an optimal mix of assets across the development cycle with sales of assets or strategic stakes in assets to unlock value. Going forward, we may from time to time, consider monetising our investments in our SPVs, through divestments where required. Such divestment will provide us the financial strength to bid for other projects and improve our profits and cash flows. We plan to continue with this strategy through a constant review of our portfolio and assets for value creation.

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OUR BUSINESS The following chart outlines our present beneficial interest in each of the 17 project SPVs which are in the Operations or Development or Pre-development Phases:

Road Projects Out of the total of our 10 road projects, which comprises of 5 annuity and 5 toll projects, 4 annuity road projects and 1 toll road project are in the Operations Phase. The remainder projects comprising of 1 annuity road project and 4 toll road projects are in their Development Phase. Road Projects under Operational Phase The following table summarizes certain of the key features of our road projects in Operations Phase:

Particulars REL AEL KBICL GICL MNEL

Description of project

Strengthening of the existing 2 lanes and widening of the same to 4 lane dual carriageway from km 200.00 to 253.00 (approximately 53 kms.) on the Rajahmundry – Dharmavaram section of NH – 5 in the state of Andhra Pradesh

Strengthening of the existing 2 lanes and widening thereof to 4 lane dual carriageway, from km 253.00 to 300.00 (approximately 47 kms.) on the Dharmavaram-Tuni section of NH – 5 in the state of Andhra Pradesh

Designing, construction, financing, maintenance and operation of a 4 – lane Bridge across the river Kosi (including its approaches and guide bund and afflux bund) from km. 155.00 to 165.00 (designed chainage: km. 148.550 to 159.185, approximately 10.635 kms.) on NH – 57, in the State of Bihar

Designing, construction, financing, maintenance and operation of a bypass from km. 0.00 to 32.27 (approximately 32.27kms.) on NH – 28, in Gorakhpur located in the state of Uttar Pradesh

Improvement, operation, maintenance, rehabilitation and strengthening of the existing 2- lane road and widening the same to 4 –lane divided highway, from km. 539.50 to 440.00 (approximately 99.50 kms) on the Vadape-Gonde section of NH-3, located in the state of Maharashtra

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Particulars REL AEL KBICL GICL MNEL

Date of concession agreement

October 30, 2001 October 30, 2001 October 6, 2006 October 6, 2006 October 14, 2005

Type of project Annuity project with semi-annual payments, payable on May 30 and November 30

Annuity project with semi-annual payments, payable on May 30 and November 30

Annuity project with semi-annual payments, payable on October 4 and April 4

Annuity project with semi-annual payments, payable on October 4 and April 4

Toll project

PPP Model BOT BOT BOT BOT BOT

Location

Between Rajahmundry and Dharmavaram section of the NH-5 in Andhra Pradesh

Between Dharmavaram and Tuni section of the NH-5 in Andhra Pradesh

Bridge across the river Kosi on NH – 57 in Bihar

Gorakhpur on NH – 28 in Uttar Pradesh

Vadape-Gonde section of NH-3, in Maharashtra

Term of the concession

17 years and 6 months and is valid until November 29, 2019

17 years and 6 months and is valid until November 29, 2019

20 year and valid until April 4, 2027

20 years and valid until April 4, 2027

20 years and valid until April, 2026

Commissioning Date

September 20, 2004

October 30, 2004 February 08, 2012

March 31, 2012

May 11, 2010 and July 11, 2011 and June 18, 2012

Our ownership interest including the beneficial interest (directly or indirectly)

100%

100% 100% 100% 79.99%

Amount of each annuity payment (semi annual payment) (₹ In lakhs)

2,961.90

2,791.20

3,190.00 4,860.00 NA

Project Cost as of December 31, 2013(1) (₹ in lakhs)

25,642.21 24,807.61

51,854.62

72,128.78 92,718.06(2)

Security arrangements

The loans are secured.

The loans are secured.

The loans are secured.

The loans are secured.

The loans are secured.

(1) The project cost includes only the gross intangible assets. (2) The project cost includes the negative grant of ₹ 12,000.00 lakhs capitalised in the balance sheet Total outstanding borrowings as of June 30, 2014

(₹ in lakhs)

Particulars REL AEL KBICL GICL MNEL

Long Term borrowings (A)

8,557.19 7,659.21 29,378.05 66,633.58 71,353.73

Short Term - - - - -

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borrowings (B)

Current maturities of long term borrowings (C)

1,508.34 1,355.10 2,217.00 3,600.00 5,675.00

Total outstanding borrowings (A+B+C)

10,065.53

9,014.31 31,595.05

70,233.58

77,028.73

Some details in relation to the road projects as set out above are provided below. Rajahmundry Expressway Annuity Road Project and Andhra Expressway Annuity Road Project Concession Agreement Some of the key terms common to the concessions of REL and AEL include: The right to receive the annuity shall be reduced proportionately if, as a result of concessionaire`s failure to

perform or discharge its obligations under the respective concession agreement, the actual availability of the carriageway in any annuity payment period during the operations period is less than the assured availability. The difference between the assured availability and the actual availability of the carriageway is referred to as “Non-Availability”.

Right of NHAI to treat frequent occurrences of Non-Availability or continued Non-Availability as a

persistent breach of O&M requirements, which constitutes an event of default under the concession agreement.

NHAI at any time after the COD may decide to increase the capacity of the project (“Capacity

Augmentation”). NHAI may invite bids for Capacity Augmentation and concessionaire has an option to submit its bid for Capacity Augmentation in response to such invitation. In the event that the concessionaire is not the preferred bidder, it will be given the first right of refusal to match the preferred bid. If it matches the preferred bid and NHAI accepts such bid, it will pay NHAI an amount equal to the bidding cost to be reimbursed to the preferred bidder. In case REL and AEL chooses not to submit its bid for Capacity Augmentation, or is not the preferred bidder, and also fails or declines to match the preferred bid, NHAI will be entitled to accept the preferred bid and terminate the concession agreement upon payment of the termination payment to its concessionaire(s) (i.e. REL and AEL, as applicable). The termination payment shall be the amount equivalent to the discounted value of future net cash flows from these projects.

NHAI has the authority to levy a toll or a fee on the vehicles using the project facilities (the “Fee”) and to

demand, collect, retain and appropriate the Fee as it deems fit in its sole discretion, either by itself or by authorizing any other person. Further, NHAI has the right to construct, erect, install, operate and maintain plazas as may be necessary for the levy and collection of the Fee; however, such activities must be carried out by NHAI at its own expense.

AEL and REL must ensure that the consortium holds not less than 51% of its paid up equity capital until

three years after the COD and not less than 26% of its paid up capital during the balance of the concession period. Further, lead technical member and the lead financial member shall hold a minimum equity stake of 25% each of the consortium’s holding in the paid up capital of AEL and REL during the concession period.

Operations and Maintenance The O&M for REL and AEL is sub-contracted to our Company by GIL pursuant to an agreement dated

March 31, 2006 for an aggregate one-time upfront payment of ₹ 2,500.00 lakhs (the “REL AEL O&M Agreement”). The operations and maintenance services provisions by GIPL commenced from April 1, 2006 until the expiry of the entire concession period.

Fixed semi-annual payments are payable to GIL and, in turn, to the Company for routine maintenance

carried out by the Company for the Rajahmundry Expressway Annuity Road Project/ Andhra Expressway

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Annuity Road Project, and lump sum payments to be made on the 5th, 10th and 15th years after the COD, respectively, payable to GIL and, in turn, to the Company, for the periodic maintenance works to be carried out by the Company. All amounts payable under the REL AEL O&M Agreement are subject to 3% semi annual escalations. In financial year 2010, concessionaires successfully completed their first round of periodic maintenance that is required to be performed every 5 years under the concession agreement.

Financing Agreements AEL and REL has refinanced the final project cost of ₹ 24,807.61 lakhs for Andhra Expressway Annuity Project and ₹ 25,642.21 lakhs for Rajahmundry Expressway Annuity Road Project vide a facility agreement dated March 25, 2006 with Canara Bank, Federal Bank and IDBI Bank Limited to provide a rupee term loan for an amount aggregating to ₹ 23,300.00 lakhs and ₹26,100.00 lakhs, respectively. The loan for REL and AEL shall be repaid by December 07, 2019. As on June 30, 2014, the total outstanding borrowings payable by REL is ₹ 10,065.53 lakhs and for AEL is ₹ 9,014.31 lakhs. Bonus Rajahmundry Expressway Annuity Road Project commenced commercial operations 70 days before the schedule COD for which a bonus amount of ₹ 1,110.78 lakhs along with an interest of ₹ 541.50 lakhs on February 01, 2011 was received. Andhra Expressway Annuity Road Project commenced commercial operations 30 days before schedule COD for which a bonus amount of ₹ 465.20 lakhs along with an interest of ₹ 245.10 lakhs on February 01, 2011 was received. Kosi Bridge Annuity Road Project Concession Agreement The material terms of the Kosi Concession Agreement, includes the following: Annuity: The annuity payments are semi-annual. NHAI is required to pay KBICL ₹ 3,190.00 lakhs on each

annuity payment date, i.e., October 4 and April 4 of each year.

The right to receive the annuity shall be reduced proportionately if, as a result of concessionaire`s failure to perform or discharge its obligations under the respective concession agreement, the actual availability of the carriageway in any annuity payment period during the operations period is less than the assured availability. The difference between the assured availability and the actual availability of the carriageway is referred to as “Non-Availability”.

Fee: NHAI shall have the authority to levy toll or fee on the vehicles using the project facilities (the fee)

and to demand, collect, retain and appropriate the fee in accordance with the applicable laws. Capacity Augmentation: NHAI at any time after the COD may decide to increase the capacity of the project

(“Capacity Augmentation”). NHAI may invite bids for Capacity Augmentation and concessionaire has an option to submit its bid for Capacity Augmentation in response to such invitation. In the event that the concessionaire is not the preferred bidder, it will be given the first right of refusal to match the preferred bid. If it matches the preferred bid and NHAI accepts such bid, it will pay preferred bidder, who made the lowest bid, an amount equal to ₹ 10.00 lakhs toward bidding cost. In case KBICL chooses not to submit its bid for Capacity Augmentation, or is not the preferred bidder, and also fails or declines to match the preferred bid, NHAI will be entitled to accept the preferred bid and terminate the concession agreement upon payment of the termination payment to its concessionaire(s). The termination payment shall be the amount equivalent to the discounted value of future net cash flows from this project.

Equity Requirement: KBICL must ensure that the consortium holds not less than 51% of its paid up equity

capital until three years after the COD and not less than 26% of its paid up capital during the balance of the concession period. Further, GIL (being the lead member of the consortium) shall hold a minimum equity

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stake of 51% of the consortium’s holding in the paid up capital of KBICL during the concession period. The Company has committed to hold a minimum equity stake of 10% of the consortium’s holding in the paid up capital of KBICL during the concession period.

Letter of Credit: In terms of the Kosi Concession Agreement, NHAI has provided KBICL with an

irrevocable revolving letter of credit dated December 12, 2012, from Canara Bank for an aggregate amount not exceeding ₹ 92,510.00 lakhs, which is valid for a period starting from December 12, 2012 till April 19, 2027.

Backed-Up Annuity: Vide letter dated February 6, 2014, NHAI approved 507 delay days and accorded

permission to release ₹ 6,734.40 lakhs to KBICL as backed-up annuity. The payment was released on February 13, 2014

Operations and Maintenance Our Company shall be responsible for the O&M services of the Kosi Bridge Annuity Road Project. KBICL has granted the contract for carrying out maintenance activities of the Kosi Bridge Annuity Road Project, pursuant to a letter dated April 01, 2012. The maintenance services provided by our Company shall be valid for a period of 3 years commencing from April 1, 2012 till March 31, 2015, in consideration of which our Company shall receive a fixed fee of ₹150 lakhs per year, payable by KBICL at the end of every Financial Year. Financing Arrangements The original estimated cost of setting up the Kosi Bridge Annuity Road Project was ₹ 43,961.00 lakhs. This was financed with debt of ₹ 39,130.00 lakhs and equity of ₹ 4,831.00 lakhs. KBICL availed a term loan of₹ 39,130.00 lakhs, vide an agreement dated April 28, 2007, from a consortium of 2 banks comprising of Canara Bank and Central Bank of India. The loan is repayable by October 04, 2024. Subsequently, KBICL availed a rupee term loan of ₹ 13,188.00 lakhs from India Infrastructure Finance Company Limited by way of takeout financing, for the purpose of taking over the part of the outstanding loan amount of Canara Bank and Central Bank of India vide takeout agreement dated December 28, 2012. Post the execution of the takeout agreement, Canara Bank and Central Bank of India cancelled the undisbursed portion of their respective commitments and the total loan amount was reduced to ₹ 34,488.00 lakhs, to be repaid to Canara Bank, Central Bank of India and India Infrastructure Finance Company Limited by KBICL by October, 2024. Due to the delay in the commissioning, the project cost of the Kosi Bridge Annuity Road Project was increased to ₹ 51,854.62 lakhs, which was financed by way of a subordinate debt for an amount of ₹ 5,500.00 lakhs availed from Aditya Birla Finance Company vide an agreement dated February 24, 2012, which was subsequently repaid; and (ii) an inter corporate loan. As on June 30, 2014, the total outstanding borrowings payable by KBICL is ₹ 31,595.05 lakhs. Engineering, Procurement and Construction Contract GIL and KBICL entered into an agreement on April 14, 2007 for the design, engineering, procurement of materials and plants, construction and all other works and things necessary for the completion of the Kosi Bridge Project. A fixed price of ₹ 34,705.00 lakhs is payable by KBICL to GIL with payment being made upon specified milestones being achieved. In terms of the Kosi EPC, GIL is required to provide KBICL with a performance security in the form of a bank guarantee equal to 10% of the Contract Price, out of which 5% of the Contract Price shall be released upon issuance of the final completion certificate by the independent consultant (appointed under the Kosi Concession Agreement) and the balance 5% of the Contract Price shall be released upon the expiry of the construction defects liability period (plus one month of claim period). Further, as a consequence of the delay in commissioning of the Kosi Bridge Annuity Road Project attributable to NHAI, GIL as the EPC contractor pursuant to Kosi EPC raised a claim of ₹ 6,646.00 lakhs on account of the

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underutilization of manpower and machineries against KBICL vide letter no. WSS/G/KOSI/358 dated March 21, 2012. The claim amount was acknowledged and accepted to be payable by KBICL vide its letter no. KBICL/PAP/AM/2012/024 dated April 6, 2012 to GIL stands outstanding as on date. Gorakhpur Annuity Road Project Concession Agreement Some of the key terms of the concession agreement in relation to Gorakhpur Annuity Road Project. Annuity: The annuity payments shall be paid on semi-annual basis. NHAI is required to pay GICL

₹4,860.00 lakhs on each annuity payment date, i.e., October 4 and April 4 of each year. Capacity Augmentation: NHAI at any time after the COD may decide to increase the capacity of the project

(“Capacity Augmentation”). NHAI may invite bids for Capacity Augmentation and concessionaire has an option to submit its bid for Capacity Augmentation in response to such invitation. In the event that the concessionaire is not the preferred bidder, it will be given the first right of refusal to match the preferred bid. If it matches the preferred bid and NHAI accepts such bid, it will pay preferred bidder, who made the lowest bid, an amount equal to ₹ 10.00 lakhs toward bidding cost. In case GICL chooses not to submit its bid for Capacity Augmentation, or is not the preferred bidder, and also fails or declines to match the preferred bid, NHAI will be entitled to accept the preferred bid and terminate the concession agreement upon payment of the termination payment to its concessionaire(s). The termination payment shall be the amount equivalent to the discounted value of future net cash flows from this project.

Equity Requirement: GICL must ensure that the consortium holds not less than 51% of its paid up equity

capital during construction period and until three years after the COD and not less than 26% of its paid up capital during the balance of the concession period.

Letter of Credit: In terms of the Gorakhpur Concession Agreement, NHAI shall have provided GICL with

an irrevocable revolving letter of credit from a scheduled bank in India for a sum equal to ₹ 4,860.00 lakhs (“Gorakhpur LC”) within 30 days from the occurrence of the expected commercial operations date as intimated by GICL. The Gorakhpur Annuity Road Project has achieved commercial operations on March 31, 2012 and GICL is yet to receive the copy of letter of credit.

Operations and Maintenance GICL from time to time has granted the contract for carrying out maintenance activities of the Gorakhpur Annuity Road Project to GIPL. Pursuant to a letter of dated February 28, 2014 the operation and maintenance services contract was renewed for a period of 1 year commencing from April 1, 2014 till March 31, 2015, in consideration of which our Company shall receive a fixed annual service fee of ₹280.00 lakhs, payable by GICL at the end of the Financial Year. Financing Arrangements The original estimated cost of developing the Gorakhpur Annuity Road Project was ₹64,921.00 lakhs. This was financed with debt of ₹57,543.00 lakhs and equity of ₹7,378.00 lakhs. GICL availed a rupee term loan of ₹57,543.00 lakhs, vide a common loan agreement dated May 11, 2007 and amendment number 1 to common loan agreement dated April 20, 2009, from a consortium of 5 banks comprising of Bank of India, Canara Bank, Central Bank of India, Punjab National Bank and IIFCL. Due to the delay in the commissioning, the project cost of the Gorakhpur Annuity Road Project increased to ₹ 72,128.78 lakhs. The loan availed by the exiting lenders was refinanced by GICL by a rupee term loan of ₹51,500.00 lakhs availed by GICL to refinance the existing debt (including servicing of interest and payment of prepayment premium), through an agreement dated November 14, 2011, from Infrastructure Development Finance Company Limited (IDFC Limited). The loan is repayable by April 25, 2025. As on June 30, 2014, the total outstanding borrowings payable by GICL is ₹ 70,233.58 lakhs.

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Additionally, a subordinate loan of ₹12,000.00 lakhs was availed by GICL, through an agreement dated December 05, 2011, from IDFC Limited for additional funding of the project cost (including interest servicing, payment of prepayment premium, if any to the existing lenders and balance EPC work for the Gorakhpur Annuity Road Project). As on June 30, 2014, there is no amount outstanding. Engineering, Procurement and Construction Contract GICL entered into an agreement dated April 14, 2007 with GIL for the design, engineering, procurement of materials, plant, construction and all other works and things necessary for completion of the Gorakhpur Annuity Road Project. A fixed contract price of ₹ 55,190.00 lakhs was payable by GICL to GIL, with payments being made upon specified milestones being achieved. In terms of GICL EPC, GIL is required to provide GICL with a performance security in the form of a bank guarantee equal to 10% of the Contract Price. Mumbai Nasik Expressway Toll Road Project Concession Agreement Some of the key terms of the concession agreement in relation to the MNEL Concession Agreement are as follows: Fees: MNEL is entitled, during the operations period to levy and collect fees from the users of the project

highway. The fee notification provides for an annual revision of the fees linked to variation in WPI. Such fees may not be in excess of the following discounted rates:

local personal traffic: 12.5% of the applicable fees for the specific category of vehicle; or local commercial traffic: 25% of the applicable fees for the specific category of vehicle.

Concession Fee: The concession fee payable by MNEL to NHAI is ₹ 1 per year during the term of the

concession agreement. Capacity Augmentation: NHAI at any time after 8 years following the COD may decide to increase the

capacity of the project (“Capacity Augmentation”). NHAI may invite bids for Capacity Augmentation and concessionaire has an option to submit its bid for Capacity Augmentation in response to such invitation. In the event that the concessionaire is not the preferred bidder, it will be given the first right of refusal to match the preferred bid. If it matches the preferred bid and NHAI accepts such bid, it will pay preferred bidder, who made the lowest bid, an amount equal to ₹ 10.00 Lakhs toward bidding cost. In case MNEL chooses not to submit its bid for Capacity Augmentation, or is not the preferred bidder, and also fails or declines to match the preferred bid, NHAI will be entitled to accept the preferred bid and terminate the concession agreement upon payment of the termination payment to its concessionaire(s) in accordance with the concession agreement.

Equity Requirement: concessionaire must ensure that the consortium holds not less than 51% of its paid up

equity capital during construction period and until three years after the COD and not less than 26% of its paid up capital during the balance of the concession period.

Grant: NHAI has agreed to provide to the concessionaire cash support by way of grant equal to the sum of ₹

15,900.00 lakhs out of which ₹ 5,100.00 lakhs is payable during construction period and ₹ 10,800.00 lakhs is payable during the operational period (“grant”); and the concessionaire agrees to provide to NHAI cash payment (the “negative grant”) equal to the sum of ₹ 12,000.00 lakhs during the last year of the concession period in accordance with the provisions of the concession agreement.

Operations and Maintenance MNEL from time to time has granted the contract for carrying out maintenance activities of the Mumbai Nasik Expressway Toll Road Project to GIPL. Pursuant to a letter of dated February 28, 2014 the operation and maintenance services contract was renewed for a period of 1 year commencing from April 1, 2014 till March 31, 2015, in consideration of which our Company shall receive a fixed annual service fee of ₹1,600.00 lakhs,

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payable by MNEL. Engineering, Procurement and Construction Contract MNEL entered into an agreement dated March 22, 2006 with GIL for the design, engineering, procurement of materials, construction and all other works and things necessary for completion of the Mumbai Nasik Expressway Toll Road Project. A contract price of ₹62,100.00 lakhs was payable by MNEL to GIL, with payments being made upon specified milestones being achieved. In terms of MNEL EPC, GIL is required to provide MNEL with a performance security in the form of a bank guarantee equal to 5% of the Contract Price. Financing Arrangements The cost of developing the Mumbai-Nasik Expressway Project is ₹92,718.06 lakhs which includes the negative grant of ₹ 12,000.00 lakhs. Further, in terms of the MNEL Concession Agreement, MNEL will receive a grant of ₹5,100.00 lakhs from NHAI during the construction period out of which ₹5,046.50 lakhs has been received as on December 31, 2013 and shall receive balance construction grant of ₹5.35 lakhs as O&M grant. Out of the total O&M grant of ₹10,800.00 lakhs, MNEL has received ₹7,289.37 lakhs as the O&M grant till June 2014 and the balance grant of ₹3,510.63 lakhs is yet to be received by MNEL from NHAI. MNEL had availed a loan of ₹65,000.00 lakhs, through an agreement dated June 1, 2006 (as amended vide amendment no.1 to common loan agreement dated September 16, 2010), from a consortium of 7 banks comprising of Canara Bank, Central Bank of India, Small Industries Development Bank of India, State Bank of Patiala, Bank of Rajasthan Limited (subsequently acquired by ICICI Bank Limited), UCO Bank Limited and Union Bank of India, to partially finance the project. The loan is repayable by March 2021. Additionally, MNEL availed a subordinate loan of ₹17,370.00 lakhs, through an agreement dated June 29, 2013, from Punjab National Bank for the purpose of utilizing the funds for investment in infrastructure road projects by way of loan to its parent company, i.e., GIPL or by way repayment of debt taken from the its parent company (GIPL), after obtaining approvals from NHAI and other lenders to the consortium. The loan is repayable by March 31, 2021. As on June 30, 2014, the total outstanding borrowings payable by MNEL is ₹ 77,028.73 lakhs. Road Projects under Development Phase The following table summarizes certain of the key features of the road projects under development:

Particulars PHPL RGBL SSRPL VGRPPL PBHL

Description of project

Upgradation of Hajipur-Muzzafarpur section of the existing NH-77 to four lane dual carriageway, from km. 0.00 to 46.30 km (approximately 46.30 kms.) and construction of 16.870 kms. New bypass starting at km. 46.300 and connecting NH-28 of East – West corridor at 515.045kms. (approximately 63.371kms.) in the state of Bihar

Designing, construction, financing, maintenance and operation of a major bridge across river Godavari with approach roads, starting at km 82.4 of Eluru-Gundugolanu-Kovvur road on Kovvur side and joining NH-5 at km 197.4 on Rajahmundry side in the State of Andhra Pradesh

Augmentation of existing road by to four laning of Sidhi – Singrauli section on NH – 75E from km 83.4 to 195.8 (approximately 102.60 kms.), located in the state of Madhya Pradesh

Augmentation of existing NH-5 to six laning of Vijayawada – Gundugolanu section of NH-5 from kms. 1076.48 to 1022.48, including 6 lane Hanuman Junction by pass, i.e. 6.72 kms. And 4 – lane Vijayawada bypass (approximately 47.88 kms.) (total length approximately 103.59 kms.), located in the state of Andhra

Augmentation of the existing road to four laning of the Patna – Buxar section on NH- 30 & 84 from kms. 0.00 to 124.850 (approximately 125.443 kms.), located in the state of Bihar

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Particulars PHPL RGBL SSRPL VGRPPL PBHL

Pradesh

Date of concession agreement

February 24, 2010 November 5, 2008

May 14, 2012 March 21, 2012 February 02, 2012

Type of project Annuity project with semi-annual payments, payable on February 18 and August 18.

Toll Project Toll Project Toll Project Toll Project

PPP Model BOT DBFOT BOT BOT BOT

Location NH 77 and 28, in the state of Bihar.

Kovvur and Rajahmundry across the river Godavari in the state of Andhra Pradesh.

NH 75E in the state of Madhya Pradesh.

NH 5 in the state of Andhra Pradesh.

NH 30 and 84 , in the state of Bihar

Term of concession

15 years from the Appointed Date (i.e. August 12, 2010)

25 years from the Appointed Date (i.e. May 26, 2009)

30 years from the Appointed Date

30 years from the Appointed Date

20 years from the Appointed Date(2)

Commissioning Date (Expected COD)

August, 2014

December 31, 2014(1)

730 days from the Appointed Date(3)

912 days from the Appointed Date(4)

912 days from the Appointed Date(2)

Our ownership interest (directly or indirectly)

100%

67.41% 100%

100%

100%

Amount of each annuity payment (semi – annual payment) (₹ In lakhs)

9460.00 N.A N.A N.A N.A

Project Cost (in ₹ lakhs) (Original Project Cost)

94,005.00

86,110.00 1,09,416.00 2,08,700.00 1,50,727.00

Security arrangements

The loan is secured

The loan is secured

The loan is secured

The loan is secured

The loan is secured

(1) The commercial operation of the Rajahmundry Godavari Toll Road Project was expected to commence in May 2014, however, RGBL requested for further extension of the commercial operations date to March, 2015. APRDC vide its letter dated August 8, 2014 extended the scheduled commercial operation date to December 31, 2014.

(2) The Appointed Date is yet to be notified by NHAI. (3) Appointed date is September 19, 2013. (4) Appointed date is September 1, 2014. Tolling operations at the two toll booths of Vijayawada Gundugolanu Toll

Road Project has commenced with effect from September 1, 2014;

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Total outstanding borrowings as of June 30, 2014

(₹ in lakhs)

Particulars PHPL RGBL SSRPL VGRPPL(2) PBHL

Long Term borrowings (A)(1)

88,052.08 55,267.79 15,639.07 7,796.18 2,731.71

Short Term borrowings (B)

- - - - -

Current maturities of long term borrowings (C)

2,766.42 1,274.00 - - 4,433.58

Total outstanding borrowings (A+B+C)

90818.50

56,541.79 15,639.07 7,796.18 7,165.29

(1) Includes inter-corporate deposits (ICD) availed from GIPL (2) Long term borrowings only include ICDs availed from GIPL Some details in relation to the projects as set out above are provided below: Patna Highways Annuity Road Project Patna Highways Annuity Road Project involves the up-gradation of Hajipur–Muzaffarpur section of the existing NH 77 to four lane dual carriageway configurations on a 46.3 km long section of road and construction of a 16.870 km new bypass starting at km. 46.300 and connecting NH-28 of East – West corridor at 515.045 kms. in the State of Bihar. The concession agreement entered into between PHPL and NHAI dated February 24, 2010 is for period of 15 years, ending in August 2025. The scheduled COD for the partial part of project was supposed to be achieved by August 2014. Concession Agreement The material terms under the Patna Highway Concession Agreement include: Levy and Collection of Fees: PHPL is not allowed to collect any fee or any form of remuneration from any

users of the project. Further no advertisements or hoarding or any other commercial activity is allowed. Hence, PHPL is not entitled to any such revenue from commercial activities in relation to the project and unless provided in the concession agreement its revenue shall consist of annuity only.

Equity Requirement: concessionaire must ensure that the consortium holds not less than (i) 51% of its paid

up equity capital during construction period (ii) 33% during a period three years after the COD and (iii) 26% of its paid up capital during the balance of the concession period.

Concession Fee: The concession fee payable by PHPL to NHAI is ₹1 per year during the term of the Patna

Highway Concession Agreement. Financing Arrangements The cost of developing the project is estimated to be ₹94,005.00 lakhs. This is to be financed with debt of ₹84,600.00 lakhs and equity of ₹9,405.00 lakhs. PHPL has availed a loan of ₹84,600.00 lakhs from a consortium of 3 banks comprising of the Federal Bank Limited, Indian Bank, Yes Bank Limited, through an agreement dated August 18, 2010, as amended vide amendment no.1 to common loan agreement dated September 28, 2010 and as novated vide novation deed dated September 28, 2010 in favour of Indian Overseas Bank, Punjab and Sind Bank, Corporation Bank and Bank of Maharashtra. Due to, delay in commissioning of the Patna Highways Annuity Road Project on account of non-availability of land, cost of the Patna Highway Annuity Road Project has increased to ₹1,00,345.00 lakhs, which is proposed to

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be financed by way of infusion of equity into PHPL for an amount of ₹6,340.00 lakhs, for the cost overrun incurred by PHPL under the Patna Highways Annuity Road Project, as indicated under the supplemental agreement dated November 29, 2013. For further details, please refer to “Risk Factors” on page 55. The loan is repayable by August 31, 2025. As on June 30, 2014, the total outstanding borrowings payable by PHPL is ₹ 90,818.50 lakhs. Engineering, Procurement and Construction Contract PHPL entered into an agreement on February 22, 2011 with GIL for the design, engineering, procurement of raw materials and equipment, construction and all other works and things necessary for the completion of the Patna Highway Project (the “PHPL EPC”). A fixed contract price of ₹75,000.00 lakhs (the “Contract Price”) is payable by PHPL to GIL, with payments being made upon specified milestones being achieved. In terms of the PHPL EPC, GIL is required to provide PHPL with a performance security in the form of a bank guarantee equal to 10% of the Contract Price. Rajahmundry Godavari Toll Road Project Concession Agreement The material terms under the Godavari Concession Agreement include: Fees: RGBL is entitled to collect and retain the fees from users of the Godavari Bridge Project from COD

till the end of Concession Period. Under the Godavari Concession Agreement, the toll rate shall be subject to revision on an annual basis and fully linked to the WPI notified by the Central Government.

Concession Fee: RGBL shall pay concession fees to the Government of Andhra Pradesh in accordance with

the Godavari Concession Agreement. The amount of the concession fees payable by RGBL on each of the first nine years from Appointed Date is ₹ 1 and for the tenth year the concession fees shall be 1% of the amount realised by RGBL from the Godavari Bridge Project, and for each year thereafter, there shall be an annual increment at 1% per annum. For the sake of clarity, the concession fee shall be 2% for the eleventh year and shall increase by 1% for every succeeding year.

Equity requirement: concessionaire must ensure that the consortium holds not less than (i) 51% of its paid

up equity capital during construction period (ii) 33% during a period three years after the COD and (iii) 26% of its paid up capital during the balance of the concession period GIPL

Change in Traffic Growth: If on a date specified in the Godavari Concession Agreement (“Target Date”),

the actual number of vehicles using the Godavari bridge (“Actual Traffic”) differs from the targeted number of vehicles as stipulated in the Godavari Concession Agreement (“Target Traffic”) and the difference is more than 2.5% of the Target Traffic, the concession period shall be deemed to have been varied. In such event, where the Actual Traffic falls short of the Target Traffic, the concession period shall be increased by 1.5% for every 1% of shortfall, subject to RGBL paying to Government of Andhra Pradesh the commensurate concession fee. The maximum increase of the concession period permitted by the Godavari Concession Agreement is 20%. Conversely, if the Actual Traffic exceeds the Target Traffic on the Target Date by more than 2.5%, then for every 1% of excess, the concession period shall be reduced by 0.75%. The maximum reduction in the concession period permitted under the Godavari Concession Agreement is 10%. Where the average daily traffic of vehicles on the bridge in any fiscal year shall exceed the designed capacity of the bridge and this shall continue for three more fiscal years, Government of Andhra Pradesh may at its discretion terminate the concession by giving a notice and making a termination payment to RGBL.

Capacity Augmentation: APRDC at any time after the COD upon the average daily traffic exceeding 60,000 PCUs (passenger car unit) may decide to increase the capacity of the project (“Capacity Augmentation”). APRDC may invite bids for Capacity Augmentation and concessionaire has an option to submit its bid for Capacity Augmentation in response to such invitation. In the event that the concessionaire is not the preferred bidder, it will be given the first right of refusal to match the preferred bid. If it matches the preferred bid and APRDC accepts such bid, it will pay preferred bidder, who made the lowest bid, an amount equal to ₹ 10.00 Lakhs toward bidding cost. In case RGBL chooses not to submit its bid for Capacity Augmentation, or is not the preferred bidder, and also fails or declines to match the preferred bid,

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APRDC will be entitled to accept the preferred bid and terminate the concession agreement upon payment of the termination payment to its concessionaire(s). The termination payment shall be the amount equivalent to the discounted value of future net cash flows from this project.

Grant: In terms of the Godavari Concession Agreement, RGBL can avail a grant of up to ₹20,755.00 lakhs

jointly from the Government of India and the Government of Andhra Pradesh, in form of equity and O&M support.

Financing Arrangements The cost of constructing the Rajahmundry Godavari Toll Road Project is estimated at ₹86,110.00 lakhs. This was originally proposed to be financed with a debt of ₹56,600.00 lakhs and equity of ₹17,650.00 lakhs and grant to be received as viability gap funding of ₹11,860.00 lakhs from the Government of India, in terms of the Tripartite Agreement. RGBL had availed a loan of ₹56,600.00 lakhs, through an agreement dated May 26, 2009 from a consortium of four banks comprising of Bank of Baroda, Canara Bank, Union Bank of India and United Bank of India. The loan is repayable by March 31, 2027. As on June 30, 2014, the total outstanding borrowings payable by RGBL is ₹ 56,541.79 lakhs. In relation to the grant, the maximum amount that will be available during the construction period is restricted to the amount of equity capital of RGBL. The balance grant shall be made available during the operations period. The grant will made available to RGBL after it has utilized the equity contribution from its shareholders and shall be disbursed to RGBL in proportion to the disbursement of the loan funds. In order to avail the grant from the Government of India for the construction period, a tripartite agreement dated December 1, 2010 (the “Tripartite Agreement”) has been entered into between RGBL, Canara Bank and the Central Government (through the Joint Secretary, Department of Economic Affairs, Ministry of Finance) whereby the Central Government is providing viability gap funding grant of ₹11,860.00 lakhs to RGBL through Canara Bank. Out of the total viability gap funding of ₹11,860.00 lakhs from the Government of India, RGBL has received an amount of ₹10,944.00 lakhs and balance shall be received prior to the scheduled COD subject to certain conditions, including but not limited to drawdown of the remaining part of the sanctioned loan amount and the equity contribution being more than the grant. Further, RGBL has received an amount of ₹7,603.00 lakhs as state government equity support in accordance with the terms of the concession Agreement and balance amount of ₹1,292.00 lakhs from the state government equity support is pending to be received upon release of remaining amount sanctioned by the lenders and release of the balance equity support by the Government of India. Due to the delay in handing over ‘right of way’, delay in handing over land for toll plaza and delay in finalizing the agreement with APRDC for providing at grade junction on joining NH-16, RGBL has faced time and cost over-runs. The estimated cost of the Rajahmundry Godavari Toll Road Project is expected to increase to ₹1,07,002.00 lakhs as informed by RGBL vide a proposal of restructuring of debt, dated May 15, 2014, to the consortium lenders. The cost overrun is estimated due to increase in Interest cost of ₹18,225.00 lakhs during construction costs and additional EPC cost of ₹ 3,000.00 lakhs. APRDC, vide letter dated August 8, 2014 has extended the scheduled commercial operations date to December 31, 2014. For more details, please refer to “Risk Factor” on page 52. The Company, RGBL and IFCI Limited (“IFCI”) have entered into a sale and subscription agreement dated December 16, 2010 (“SSA”) for sale of up to 49% of the equity shares of RGBL to IFCI. In accordance with the terms of the SSA, IFCI has also agreed to subscribe to the equity shares of RGBL as and when RGBL raises a demand for the same and in proportion to the equity infusion by GIPL so as to maintain their respective shareholding in RGBL. However, IFCI’s aggregate obligation to purchase and subscribe to the equity shares of RGBL under the SSA shall not exceed ₹8,648.00 lakhs and it shall not hold more than 49% of the total paid up equity share capital of RGBL at any point of time. In accordance with the terms mentioned in the SSA, the Company is required to buy back all the equity shares of RGBL purchased and subscribed by IFCI after the completion of the moratorium period of 18 months from share purchase date. A buy back agreement dated December 16, 2010 (“Buy Back Agreement”) has been entered into by the Company, RGBL and IFCI for same.

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However, due to certain exigencies, GIPL was unable to buy back the shares in accordance with the terms of the Buy Back Agreement and has agreed to buy back the remaining 64,860,000 equity shares upon terms and conditions agreed under the supplementary buy back agreement dated April 09, 2014. In relation towards the payment of the principal towards equity and the premium amount to IFCI, GIPL has failed to make payments towards principal towards equity amounts from March 2014 till August 2014 (on a monthly basis) and towards premium amount from May 2014 till August 2014 (on a monthly basis) of ₹ 1,333.61 lakhs (excluding penal interest). As of June 30, 2014 our Company has bought back 2,93,93,465 equity shares out of 8,64,80,000 equity shares. For further details, please refer to “Risk Factors” on page 52. Engineering, Procurement and Construction Contract RGBL has entered into a construction services agreement with GIL dated April 27, 2010 (“CSA”) for providing construction services for the Rajahmundry Godavari Toll Road Project. RGBL shall pay GIL an all inclusive fixed sum equal to ₹48,300.00 lakhs for providing the construction services. The payment shall be made in several instalments on achieving certain milestones. In terms of the CSA, GIL is required to provide RGBL with a performance security in the form of a bank guarantee equal to 10% of the Construction Service Price. Further, RGBL has entered into a purchase agreement dated April 27, 2010 with GIL for supply of materials for the project. RGBL shall pay GIL an all inclusive fixed sum equal to ₹21,700.00 lakhs for providing the raw materials as specified in the purchase agreement. Sidhi Singrauli Road Project Limited (SSRPL) Concession Agreement The material terms under the Agreement include: Grant: MPRDCL shall provide cash support of maximum of ₹33,969.00 lakhs as a grant by way of equity

support. Equity Restrictions: concessionaire must ensure that the Company shall hold not less than 51% as on the

date of the concession agreement and not less than 26% of the paid up capital during the construction period and two years thereafter.

Concession Fee: The concession fee payable by SSRPL to MPRDCL is ₹1 per year during the term of the

Concession Period. User Fee: SSRPL shall have a right to collect the fee from the road users from date of COD. Financing Arrangement The total cost of developing the project is estimated to be ₹1,09,416.00 lakhs. This is to be financed with debt of ₹58,406.00 lakhs and equity of ₹17,041.00 lakhs. SSRPL has availed a loan of ₹58,406.00 lakhs from Punjab National Bank, through an agreement dated November 22, 2012 (“Loan Agreement”), amendments and novations, from 2 banks comprising Allahabad Bank and India Infrastructure Finance Company Limited and re-validated vide amendment No. 3 to the common loan agreement dated May 23, 2014 extending the period of first repayment to April 1, 2017 and further amending the amortization schedule under the Loan Agreement. The loan is repayable by September 1, 2028. As on June 30, 2014, the total outstanding borrowings payable by SSRPL is ₹ 15,639.07 lakhs. Engineering, Procurement and Construction Contract SSRPL has entered into engineering, procurement and construction contract dated July 3, 2013 with GIPL (“SSRPL EPC Contract”) in order to carry out design, engineering, procurement of materials and equipment, plant, construction and all other works and things necessary for completion of the project. SSRPL shall pay GIPL a total contract price of ₹97,500.00 lakhs to be paid on monthly basis as per the milestone payment

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schedule. GIPL is required to provide SSRPL with a performance security in the form of a corporate guarantee equal to 10% of the contract price. Our Company has further sub-contracted the SSRPL EPC Contract to Techno Unique Infratech Private Limited vide an agreement dated September 19, 2013. Vijayawada Gundugolanu Toll Road Project Concession Agreement The material terms under the Agreement include: Premium: VGRPPL has to pay a premium of ₹5,757.00 lakhs annually to NHAI from the appointed date

until the end of the concession period with an annual increase of 5% per annum. Equity Restrictions: concessionaire must ensure that the Company shall hold not less than 51% as on the

date of the concession agreement and not less than 26% of the paid up capital during the construction period and two years thereafter.

Concession Fee: The concession fee payable by VGRPPL to NHAI is ₹1 per year during the term of the

concession period. User Fee: VGRPPL shall have a right to collect the fee from the road users from the commercial operations

date (as defined under the concession agreement). Financial Arrangements The total cost of developing the project is estimated to be ₹2,08,700.00 lakhs. This is to be financed with debt of ₹1,67,000.00 lakhs and equity of ₹41,700.00 lakhs. VGRPPL has entered into an agreement for availed a loan of ₹1,67,000.00 lakhs, through an agreement dated March 24, 2012, amendments and novations, from 6 banks comprising Punjab National Bank, Central Bank of India, Corporation Bank, Bank of India, India Infrastructure Finance Company Limited and Allahabad Bank. Vijayawada Gundugolanu Toll Road Project is currently going through a re-validation of the debts for which VGRPPL submitted the report on December 24, 2013. VGRPPL vide its letter dated December 24, 2013 requested the lenders for renewal of facility and re-scheduling of the repayment dates due to delay on the part of NHAI to fulfil its conditions precedent. The re-validation is under process and NHAI vide its letter dated August 5, 2014 has declared the appointed date to be September 1, 2014. Tolling operations at the two toll booths of Vijayawada Gundugolanu Toll Road Project has commenced with effect from September 1, 2014; As on June 30, 2014, the total outstanding borrowings payable by VGRPPL is ₹ 7,796.18 lakhs. Engineering, Procurement and Construction Contract VGRPPL has entered into engineering, procurement and construction contract with GIPL on April 26, 2012 (“EPC Contract 1”) and amended EPC Contract 1 dated September 13, 2012 for executing the construction work for proposed 4-laning proposed Vijayawada Bypass. Total contract price is ₹66,919.00 lakhs. GIPL is required to provide VGRPPL with a performance security in the form of a bank guarantee equal to ₹ 3,314.11 lakhs. The Company may at its sole discretion sub-contract the works under the EPC Contract 1 to other third party subcontractors. VGRPPL has entered into another engineering, procurement and construction contract with Simplex Infrastructures Limited on April 24, 2012 (“EPC Contract 2”) and amended EPC Contract 2 dated September 7, 2012 for executing the construction work for six-laning of the Vijayawada and Gundugolanu section of NH – 5 including 6-lane Hanuman junction bypass and construction of Krishna River Bridge at Vijayawada bypass. The contract price is ₹ 1,03,081.00 lakhs. Simplex Infrastructures Limited is required to provide VGRPPL with a performance security of ₹ 5,105.89 in the form of a bank guarantee. Patna Buxar Toll Road Project

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Concession Agreement The material terms under the Agreement include: Grant and Equity Support: In terms of the PBHL Concession Agreement, PBHL can avail a grant of up to

₹31,600.00 lakhs from NHAI, in form of equity support. Equity Restrictions: concessionaire must ensure that the Company shall hold not less than 51% during the

construction period and two years thereafter. Concession Fee: The concession fee payable by PBHL is ₹1 per year annum during the term of the

Concession Period. User Fee: PBHL shall have a right to collect the fee from the road users. Financing Agreements The cost of developing the project is estimated to be ₹1,50,727.00 lakhs. This is to be financed with debt of ₹98,500.00 lakhs and equity of ₹52,227.00 lakhs (including ₹31,600.00 lakhs of grant from NHAI). PBHL has availed a loan of ₹98,500.00 lakhs, through amendments and novations, from a consortium of 5 banks comprising of Punjab National Bank, Central Bank of India, Indian Overseas Bank, Oriental Bank of commerce and Union bank of India,. The loan is repayable by March 2028. As on June 30, 2014, the total outstanding borrowings payable by PBHL is ₹ 7,165.29 lakhs. PBHL has initiated discussions with NHAI for mutual termination of concession agreement executed for 4-laning of the Patna – Buxar stretch of NH-30 and 84, in the State of Bihar, as PBHL is unable to initiate construction activities at the project site on account of non-availability of land and certain government approvals. For more details, please refer to “Risk Factors” on page 51. Engineering, Procurement and Construction Contract PBHL has entered into engineering, procurement and construction contract with GIPL and GIL on February 14, 2013 (“EPC Contract”) for executing the entire construction work for the Patna Buxar Toll Road Project. A total fixed, lump-sum, total contract price is ₹1,20,700.00 lakhs. The payment of the contract price shall be made in accordance with the milestone schedule. In terms of the EPC Contract, GIL and GIPL, jointly, are required to provide PBHL with a performance security of ₹ 5,646.00 Lakhs in the form of a bank guarantee. Port Projects Our port projects comprise of two projects that have been awarded to us on build, operate and transfer basis, by the board of trustees of the port where these projects are located. Our Visakhapatnam Port is in the Operational Phase with two multipurpose berths at Visakhapatnam operated by our SPV, VSPL and the second port project is in its Development Phase being developed by our SPV, ICTPL, at Mumbai Harbour and Ballard Pier Station. Port Project in the Operational Phase The following table summarizes certain of the key features of operational port project:

Particulars VSPL

Description of project Construction and licensing out equipping, operation and management of two multi-purpose berths East Quay 8 and East Quay 9, for handling coal, lime stone, rock phosphate, sulphur and other bulk cargo or general cargoes or container or liquid bulk cargo (non-hazardous)

Date of license agreement November 28, 2001

Type of project Build, operate and transfer (BOT) basis

Location Northern arm of inner harbour at Visakhapatnam port

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Particulars VSPL

Term of the concession 30 years from the date of award of license and is valid until November 27, 2031

Commissioning Date EQ8 – July 24, 2004 and EQ9 – September 8, 2005

Our ownership interest including the beneficial interest (directly or indirectly)

73.76%

Royalty

17.111% of the wharfage charges and berth hire charges from the operations of the project facilities and services during the month

Project Cost (in ₹ lakhs) ₹33,074.33 lakhs as at December 31, 2013.

Amount of loan outstanding as of June 30, 2014

₹28,608.86 lakhs consisting of long term borrowings of ₹ 27,268.73 lakhs and current maturities on long term borrowings of ₹ 1,340.13 lakhs.

Security arrangements

The loans are secured.

Some details in relation to the port project as set out above are provided below. Visakhapatnam Port Project License Agreement Tariff: VSPL is entitled to a levy and tariff from cargo and vessel owners in terms of rates prescribed by the

TAMP. Land Lease Payments: VSPL is required to pay VPT land lease rentals in accordance with the prevailing

rates set by VPT from time to time. Offtake Arrangements VSPL has been granted contracts by (i) ACC Limited, for stevedoring and clearing, forwarding work for imported natural gypsum at Visakhapatnam Port, vide the terms letter dated November 14, 2013 (“ACC Terms”), which shall be valid from November 01, 2013 till September 30, 2016; (ii) Agarwal Transport Corporation Private Limited, for stevedoring and handling coal at the Visakhapatnam Port, vide the contract dated March 01, 2014 (“Agarwal Terms”), which shall be valid for a period of 1 year from March 01, 2014 till March 01, 2015; and (iii) Jaiprakash Associates Limited, for handling of coal and gypsum at the Visakhapatnam Port, vide a long term contract dated December 13, 2013 (“Jaiprakash Terms”), which shall be valid from December 15, 2013 till December 14, 2015. Operations and Maintenance VSPL on its own is operating and maintaining the Visakhapatnam Port Project. Financing Arrangements The total cost for the Visakhapatnam Port Project is ₹33,074.33 lakhs as at December 31, 2013. VSPL had availed a loan of ₹21,000.00 lakhs pursuant to an agreement dated March 15, 2006 entered into with State Bank of Patiala and Punjab National Bank (“Lenders”) to partially finance the Visakhapatnam Port Project. Subsequently, on June 26, 2009, VSPL entered into a supplementary agreement with the Lenders for the restructuring of the repayment of this loan. Further, VSPL availed a rupee loan for an amount upto the extent of ₹35,000.00 lakhs from IDFC Limited (“Re-finance Debt”) for the purpose of re-financing its existing debt, capital expenditure and for other general corporate purposes vide a rupee loan agreement dated March 30, 2012 entered into by VSPL with IDFC Limited. The re-financed debt shall be repaid by April 01, 2027. As on June 30, 2014, the total outstanding borrowings payable by VSPL is ₹ 28,608.86 lakhs.

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VPT has commenced the process of dredging to enable entry of large vessels. Vide letter dated January 28, 2014, VPT has granted leasehold rights to VSPL on land admeasuring 30 acres for the purpose of storage and handling of cargo. Port Project in the Development Phase The following table summarizes certain of the key features of port projects under Development Phase:

Particulars ICTPL

Description of project Operation and management including necessary developments, modifications and augmentation of facilities, of the Ballard Pier Station Container Terminal (“BPS Project”); and development, construction, operation and management of an off-shore container terminal (“OCT Project”) in the Mumbai Harbour, BPS Project and OCT Project collectively referred to as Mumbai Off-shore Container Terminal Project.

Date of license agreement

December 3, 2007

Type of project Build, operate and transfer (BOT) basis

Location Mumbai Harbour

Term of the concession (i) BPS Project for a period of 5 years from the date of the signing of the ICTPL concession agreement; or 2 years from the commissioning of OCT Project, whichever is earlier; and (ii) OCT Project for a period of 30 years commencing from the date of the signing of the ICTPL Concession Agreement during which ICTPL is authorized to implement the Project.

Commissioning Date January 31, 2016

Our ownership interest including the beneficial interest (directly or indirectly)

50%

Estimated Project Cost (in ₹ lakhs)

₹1,23,300.00 lakhs

Amount of loan outstanding as of June 30, 2014

₹48,583.19 lakhs consisting of long term borrowings of ₹ 41,189.25 lakhs, short term borrowings of ₹ 1854.51 lakhs and current maturities on long term borrowings of ₹ 5,539.43 lakhs.(1)

Security arrangements

The loans are secured

(1) Short term borrowings comprises of ICDs availed from GIPL. Some details in relation to the port project as set out above are provided below. Mumbai Off-shore Container Terminal Project License Agreement The key terms of the License Agreement are as follows: License Period: The license period for the BPS Project is 5 years from date of award of license (i.e. the date

of execution of the license agreement) or two years from the commissioning of the OCT Project, whichever is earlier. The license period for the OCT Project is 30 years commencing from the date of award of the license.

Minimum Equity Shareholding: The members of the consortium collectively are required to hold at least

51% of the paid-up equity share capital of ICTPL, until the expiry of 3 years from the date of commencement of commercial operations for the OCT Project.

Revenue Share: The revenue share payable by ICTPL to the Mumbai Port Trust is 35.064% of gross

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revenue. Other material terms: Third Berth (Exclusivity): ICTPL shall have the exclusive rights to start construction of the third berth not

later than (i) achieving traffic throughput of 800,000 TEUs for 2 consecutive operating years at the two berths of OCT Project; or (ii) 13th year from the date of signing of the license agreement, whichever is earlier. If ICTPL does not construct the third berth, Mumbai Port Trust shall construct a third berth as a part of additional facilities.

Additional Facility: The Mumbai Port Trust shall not construct or cause to be constructed any additional

facilities until the container throughput at the OCT Project reaches 1,200,000 TEUs in an operating year on all three berths of ICTPL over a period of 2 consecutive operating year from the time ICTPL has constructed the third berth.

In terms of the License Agreement, Mumbai Off-shore Container Terminal Project was to be commissioned

by December 2, 2010. However, the Mumbai Port Trust has on account of delays in dredging and land filling, vide letter dated June 21, 2014, granted extension of commissioning date to January 31, 2016. As per the terms of the letter, the extension is subject to the progress made by the parties at the site. Please see “Risk Factor” on page 63.

Engineering, Procurement and Construction Contract ICTPL has entered into a star rate agreement on December 20, 2008 with GIL for the design, engineering, procurement of materials, construction of the OCT Project. The contract price payable by ICTPL to GIL is ₹39,448.60 lakhs (“ICTPL EPC”). GIL has provided ICTPL with a performance and retention security deposit equal to 10% of the contract price. In addition, ICTPL shall also pay the design charges of up to ₹300.00 lakhs to GIL. Pursuant to certain changes in dimension, specifications, etc., GIL vide a letter dated March 06, 2012 requested ICTPL to approve the additional costs incurred/or to be incurred. Consequently, ICTPL vide its letter dated March 10, 2012 acknowledged the changes in design parameters and dimensions and agreed to pay such additional cost incurred or to be incurred. In order to affect the change in contract price, ICTPL and GIL entered into an addendum to EPC contract dated March 15, 2012 (“Addendum Contract”) to modify and increase the contract price to ₹51,544.02 lakhs. Further, ICTPL has also awarded Electrical and Firefighting contract to GIL for ₹ 5,000.00 lakhs. Financing Arrangements The original project cost of the Mumbai Off-shore Container Terminal Project was originally estimated at ₹1,01,566.00 lakhs. The means of finance for the Mumbai Off-shore Container Terminal Project was funded with debt of ₹81,253.00 lakhs and equity of ₹20,313.00 lakhs. ICTPL has availed a loan of ₹81,253.00 lakhs along with a sub-limit by way of letter of credit for an amount of ₹25,080.00 lakhs vide a common loan agreement dated November 14, 2008, from a consortium of five banks comprising of Canara Bank, Central Bank of India, India Infrastructure Finance Company Limited, Punjab National Bank and United Bank of India. The repayment of the loan shall be made by December 03, 2024. As on June 30, 2014, the total outstanding borrowings payable by ICTPL is ₹ 48,583.20 lakhs. The original project cost was approximately ₹1,01,566.00 lakhs (including the cost of mechanical equipment) in the initial phase of three years. However, due to delay in handing over of the site by the licensor and delay in completion of capital dredging work during construction, the original project cost as estimated by the lead bank stands increased to ₹1,23,300.00 lakhs, excluding the cost for mechanical equipment. Further, ICTPL has approached the lenders for the re-appraisal of the loan package, which the lead bank has re-appraised and has recommended the extension of the date of commencement of the commercial operations till March 31, 2016 to RBI for permitting one-time special dispensation for re-structuring of the loan for extending the date of commencement of the commercial operations. The response from RBI is awaited. For further details, please refer “Risk Factors” on page 63.

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POWER PROJECTS Our power portfolio consists of five projects. The following table summarizes certain of the key features of the power projects under Development Phase and the Pre-development Phase:

PREL SHPVL YPVL THPL AIIPL

Description of project

30 MW Co-generation power plant

66 MW Hydroelectric Power Project.

261 MW Hydroelectric Power Project

60 MW Tidong II Hydroelectric Power Project

Thermal Power Project

Date of agreement

July 12, 2010 December 8, 2005 February 16, 2009 January 20, 2012 N.A.

Type of project Co-generation facility

Hydroelectric Project

Hydroelectric Project

Hydroelectric Project

Thermal Power Project

Location Pravara Nagar, District Ahmednagar, Maharashtra

Rimbi River West Sikkim District Sikkim

Kinnaur District Spiti/Satluj River, Himachal Pradesh

District Kinnaur Himachal Pradesh on River Tidong

Chandrapur District, Maharashtra

Key terms of concession

Concession period 25 years

Concession period 35 years

Concession period 40 years from COD

Concession period of 40 years from COD

N.A.

Expected Commissioning Date

September 1, 2014(1)

December 31, 2015 (3)

YPVL has requested for mutual termination of the pre-implementation agreement

N.A. N.A.

Our ownership interest including the beneficial interest (directly or indirectly)

100% 100% 100% 51%(4) 100%

Estimated Project Cost

₹ 24,907.00 lakhs(2)

₹ 49,644.00 lakhs N.A.

N.A. N.A.

(1) PREL vide its letter dated April 7, 2014 has informed the lenders that due to delays the Pravara Co-generation

Power Project will commence commercial operations from September 1, 2014. (2) PREL vide its letter dated April 7, 2014 has informed the lenders that due to delays in the Pravara Co-generation

Power Project there has been an escalation of the project cost from ₹ 23,959.0 lakhs to ₹ 24,907.0 lakhs. (3) The Government of Sikkim vide its letter dated February 10, 2010 has extended the scheduled commercial

operations date to December 2015.In the assessment of our Company the scheduled commercial operations date will be within three years of the first disbursement of the debt component.

(4) In a letter dated March 24, 2014, TPL wrote to the Government of Himachal Pradesh about its intention to exit from the JV by transferring its 49% shares to GIL.

Total outstanding borrowings as of June 30, 2014

(₹ in lakhs)

Particulars PREL SHPVL YPVL(2) THPL(2) AIIPL(2)

Long Term borrowings (A)(1)

19,524.17 3,159.48 5,718.60 162.96 3,839.99

Short Term - - - - -

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borrowings (B)

Current maturities of long term borrowings (C)

1,067.00 - - - -

Total outstanding borrowings (A+B+C)

20,591.17 3,159.48 5,718.60 162.96 3,839.99

(1) Includes inter-corporate deposits (ICD) availed from GIPL (2) Long term borrowings only include ICDs availed from GIPL Pravara Co-generation Power Project PREL entered into the project development agreement dated July 12, 2010 with Padamshri Dr. Vithalrao Vikhe Patil Sahakari Sakhar Karkhana Limited (“PDVVPSSKL”), for the designing, development, procurement, installation, erection, financing, commissioning, and operations of the Pravara Co-generation Power Project for a period of 25 years from the commercial operations date. The co-generation facility will be designed as a multi-fuel plant fired by bagasse or other bio fuel. The co-generation facility will use bagasse generated or procured by the PDVVPSSKL and additional bagasse procured by us as the main fuel to the extent available and the bio-gas made available by PDVVPSSKL. The steam produced by burning fuel will produce electric power in steam turbine generators. The co-generation facility shall supply the process steam and power to PDVVPSSKL and shall sell surplus power to any third party after meeting the requirements of PDVVPSSKL. Project Development Agreement The key terms and conditions of the project development agreement are as follows: PDVVPSSKL shall supply bagasse (not less than 2,16,000 MT during each sugarcane crushing season) as

and when generated in its sugar plant at Pravaranagar during the operation of the co-generation facility to PREL. We shall pay for the bagasse at an agreed price on a monthly basis.

PDVVPSSKL shall supply the bio-gas (not less than equivalent to 48,720 MT of bagasse during each

operating year) generated from the bio gas plant during the operation of the Pravara Co-generation Power Project. We shall pay for the bio-gas at an agreed price on a monthly basis.

Any shortfall in the minimum assured quantity of bagasse or biogas by PDVVPSSKL shall be made good

by compensating PREL of the amount incurred in procuring the additional raw materials. Further, any shortfall in supply of minimum assured quantity of steam by PREL shall be made good by compensating PDVVPSSKL for the amount incurred by it in procuring steam from other sources.

Pravara Co-generation Power Project shall supply steam and power to PDVVPSSKL for captive use and

shall sell surplus power to Maharashtra State Electricity Distribution Company Limited pursuant to the tri-party energy purchase agreement dated September 11, 2012 at the rates approved by MERC.

In terms of the Project Development Agreement, in case the prevailing tariff is higher than regulatory tariff

prevailing at the time of execution of this agreement, then PREL shall pay additional compensation being 25% share in the enhanced sale realisation, in the event surplus power has been generated using bagasse provided by PDVVPSSKL. PREL is also required to share 25% of net cash inflows received from the sale of carbon credits collected from the power generated by the Pravara Co-generation Power Project.

Post the operational period of 25 years, the power plant shall be transferred to PDVVPSSKL for ₹ 1 lakh. PREL is required to pay ₹ 2,000.00 lakhs to PDVVPSSKL for carrying out of the modernisation and

upgrade of PDVVPSSKL’s sugar plant, out of which ₹ 850.00 lakhs has already been paid. PREL has also executed the land lease agreement with PDVVPSSKL dated July 12, 2010 to lease 50.81

acres of land for the purpose of setting up and operating the co-generation facility for a period of 28 years 6 months from the date of execution of the lease agreement at an annual lease rental of ₹ 60.97 lakhs per year.

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The co-generation facility was scheduled to commence commercial operations on October 1, 2013,

however due to delays in the design changes and the delays in obtaining the necessary approvals PREL vide its letter dated April 7, 2014 indicated to the lenders that the Pravara Co-generation Power Project is expected to commence commercial operations by September 1, 2014. The same however may not be completed by September 1, 2014.

Engineering, Procurement & Construction Contract PREL has entered into EPC contracts with GIL for the execution of the civil works, supply of plant and testing of the plant works for the co-generation facility. The scope of works includes the design, engineering, procurement and installation of equipment, construction works and all other works and things necessary for the completion of the Pravara Co-generation Power Project. PREL has issued a letter of intent for the design, supply, erection, testing and commissioning of 132 KV transmission line for evacuating power from the co-generation facility to the nearest grid sub-station at Babhleshwar for a total contract price of ₹ 3,252.02 lakhs with Maha Active Engineers India Private Limited. Under the letter of intent the contractor is responsible for procuring the right of way on behalf of PREL. The defects liability period under the letter of intent is for 12 months. Financing Arrangements The total Project cost of the Pravara Co-generation Power Project is estimated by the Company at approximately is ₹ 23,959.00 lakhs. PREL has availed a loan of ₹19,167.00 lakhs, through an agreement dated July 19, 2012 with Central Bank of India and Corporation Bank. Loan is repayable by March 31, 2025. Further, due to delays in the commissioning of the Pravara Co-generation Power Project, the project cost is estimated to be ₹ 24,907.00 lakhs with a cost overrun of approximately ₹ 948.00 lakhs. PREL has represented to the lenders that the cost over-run shall be funded by the Company from its own sources and requested lenders for existing debt re-payment schedule shall be re-scheduled to a later date in accordance with the revised COD. Refer section “Risk Factor” on page no. 61. As on June 30, 2014, the total outstanding borrowings payable by PREL is ₹ 20,591.17 lakhs. PREL has also availed a working capital facility from Central Bank of India for ₹ 2,400.00 lakhs vide a working capital facility agreement March 13, 2014 for meeting the working capital requirements of the Pravara Co-generation Power Project. Rangit II Hydroelectric Power Project GIL received the letter of intent from the Government of Sikkim to develop the Rangit II Hydroelectric Power Project on a BOOT basis. The project involves the development of a 66 MW run-of-the river Hydro Electric Power Project on Rimbi river, in west district of Sikkim. Subsequently, SHPVL was incorporated to implement the project of which our Company owns a 100% equity stake. Agreement An agreement signed on December 8, 2005 between SHPVL and the Government of Sikkim for this project provides for a total concession period of thirty five years from the COD. The agreement envisages the installed capacity of 60 MW which has been revised to 66 MW as per the detailed project report submitted by SHPVL to Sikkim Power Development Corporation. The agreement requires SHPVL to provide 12% of the net energy generated for the first 15 years from the COD and 15% of the net energy generated thereafter at no cost, or pay monetary equivalent thereof to the Government of Sikkim. SHPVL may, with permission of the Government of Sikkim, sell power within and outside the State of Sikkim or use it for captive consumption. SHPVL intends to enter into a PPA either with end users of power, such as power distribution companies and large industries, or with power trading companies for sale of power generated from this project.

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Under the terms of the agreement, SHPVL is required to commence the commercial operations of the project within 72 months of the execution of the implementation agreement. However, due to delays the project has not yet commenced commercial operations and the Government of Sikkim has now extended the scheduled commissioning date to December 2015. For further details, please refer to “Risk Factors” at page 61. Operations and Maintenance SHPVL is responsible for operations and maintenance of the Rangit II Hydroelectric Power Project. Financing Arrangements The total estimated project cost of the Rangit II Hydroelectric Power Project is approximately ₹49,644.00 lakhs. SHPVL has availed a loan of ₹ 34,857.00 lakhs from Power Finance Corporation Limited (₹ 19,857.00 lakhs) and Bank of India (₹ 15,000.00 lakhs) vide facility agreement dated January 15, 2014. Loan availed from Power Finance Corporation Limited is repayable by January 15, 2031 and loan availed form Bank of India is payable by March 31, 2027. As on June 30, 2014, the total outstanding borrowings payable by SHPVL is ₹ 3,159.48 lakhs. SHPVL vide its letter dated July 15, 2014, informed Power Finance Corporation Limited regarding the increase in the project cost by ₹ 4,000.00 lakhs which would be funded through internal accruals and other fund raising options in near future. Further, SHPVL requested the lenders for (a) fixing of scheduled COD three years after the first disbursement; and (b) re-scheduling of the debt repayment period. SHPVL shall approach the Government of Sikkim for an extension in the commercial operations date. Engineering, Procurement & Construction Contract SHPVL has executed the EPC contract dated December 13, 2011 with Coastal Projects Limited (“CPL”) for undertaking civil and hydro-mechanical works in relation to the project at a total contract price of ₹ 22,035.00 lakhs. Pursuant to delays and ill financial health of CPL, CPL could not progress with the works in the manner envisaged, which led to SHPVL invoking the advance payment bank guarantee and the performance bank guarantee in November 2013. Although, the agreement between SHPVL and CPL is not terminated as of today, the works at the project site is suspended. Vide letter dated July 15, 2014, CPL has confirmed its willingness to resume work on the terms and conditions stipulated in contract dated December 13, 2011. SHPVL has awarded the EPC works for implementing the elctro-mechanical aspects of the project to GIL by agreement dated March 24, 2012 at a total project cost of ₹ 10,400.00 lakhs. Youngthangkhab Hydroelectric Power Project The Government of Himachal Pradesh vide pre-implementation agreement dated February 16, 2009 allotted the Youngthangkhab Hydroelectric Power Project to YPVL, which is 100% SPV of our Company for investigation and implementation of a 261 MW hydro-electric power project on river Satluj / Spiti in the state of Himachal Pradesh in accordance with the terms and conditions of the pre-implementation agreement. As a precondition, YPVL also paid an amount of ₹ 5,285.25 lakhs to the GoHP as up-front premium prior to the execution of the pre-implementation agreement. YPVL has initiated correspondence with the GoHP for exiting from the Youngthangkhab Hydroelectric Power Project primarily due to inability of the Government of Himachal Pradesh in resolving the local agitations related to environmental issues because of which YPVL was forced to stop the geo-technical studies. YPVL vide letter dated June 19, 2014 requested GoHP for mutual termination of the Youngthangkhab Hydroelectric Power Project and has also requested to re-imburse / refund an amount of ₹ 12,794.09 lakhs on account of losses (including the upfront premium, interest and expenses) incurred by the YPVL. The Government of Himachal Pradesh is yet to respond to YPVL’s letter. For more details, please refer to “Risk Factors” on page 49. As on June 30, 2014, the total outstanding borrowings payable by YPVL is ₹ 5,718.60 lakhs.

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Tidong II Hydroelectric Power Project The GoHP, GIL and its consortium partner (“THPL”) have signed a memorandum of understanding with GoHP on January 20, 2012 for the investigation and implementation of a 60 MW Tidong II Hydroelectric Power Project in district of Kinnaur Himachal Pradesh on River Tidong. GIL and the consortium partner hold 51% and 49% respectively in the joint venture signed by them for implementation of the said project. The in-principle approval to the Pre-Feasibility report of the project has been granted by the GoHP. Consultants have been appointed to undertake the detailed project report and environment impact assessment. Under the terms of the memorandum of understanding, GIL and TPL are required to hold 51% and 49% shareholding in THPL for a period of 2 years after the COD. Any breach of the aforesaid requirement shall lead to an automatic termination of the memorandum of understanding. In a letter dated March 24, 2014, THPL wrote to the GoHP about the TPL’s intention to exit from the project by transferring its 49% shares to GIL. The GoHP vide its letter dated April 9, 2014 responded back to the application made by THPL and requested to cite proper reasons for the exit of the consortium partner. Subsequently, THPL vide its letter dated June 2, 2014 submitted its response to the GoHP. The response is awaited from the GoHP. For further details, please refer to “Risk Factors” on page 64. As on June 30, 2014, the total outstanding borrowings payable by THPL is ₹ 162.96 lakhs. Aparna Infraenergy Thermal Power Project AIIPL, is implementing a thermal power project in Chandrapur District, Maharashtra. The project is at its initial stages of development. AIIPL has obtained the necessary approvals for water allocation and environment clearances and believes that the land acquired by AIIPL is sufficient for the implementation of the project. The approval of change of name / management was under consideration by the Standard Linkage Committee of the Ministry of Coal. Please refer to “Legal Proceedings” on page 217. As on June 30, 2014, the total outstanding borrowings payable by AIIPL is ₹ 3,839.99 lakhs. OPERATIONS AND MAINTENANCE BUSINESS The Company also provides O&M and project advisory services for projects which are being undertaken by its SPVs. The Company has been sub-contracted O&M services for the REL and AEL annuity road projects and shall provide maintenance services for Mumbai-Nasik Expressway Project. The Company shall also provide O&M services for the Kosi Bridge Project and Gorakhpur Bypass Project. COMPETITION Road Sector Under the National Highway Development Project of the NHAI, the Central Government has taken a number of initiatives to stimulate private sector participation in the road sector and we face competition from a number of Indian and international infrastructure operators. We believe other companies that are active in bidding for projects in the road sector include Larsen & Toubro Limited, GMR Infrastructure Limited, IRB Infrastructure Developers Limited, GVK Group, Madhucon Projects Limited, Punj Lloyd Limited and Infrastructure and Leasing Financial Transportation Networks Limited. Port Sector We believe that competition in the port sector in bidding for new projects would come from AP Moeller Maersk, DP World and PSA International, and Larsen & Toubro Limited and J M Baxi. Power Sector The Indian power sector is becoming increasingly competitive, largely as a result of the Government of India’s measures to deregulate, liberalise and increase private investment in the Indian power sector. In addition, thrust

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of Government of India on increasing proportion of hydro power in total power generation, supported by proactive steps taken by various state government in encouraging private sector investment in hydro power sector, is leading to increased competition in the this sector of power generation as well. In other forms of renewable energy, such as solar, where Government of India has come out with National Solar Mission, for development of solar photovoltaic and solar thermal power projects through private sector participation, it has also witnessed tremendous interest and response from various national and international companies. INSURANCE We maintain insurance policies for all of our projects through our SPVs, which we believe are sufficient to cover all material risks to our operations and revenue. Our operations are subject to hazards inherent in providing engineering and construction services, such as risk of equipment failure, work accidents, fire, earthquake, flood and other force majeure events. This includes hazards that may cause injury and loss of life, damage and destruction of property, equipment and environmental damage. Our insurance policies usually include advance loss of profit during construction phase of our SPVs, group personal accident insurance, public liability insurance, electronic equipment policy, standard fire and special perils insurance during the operations phase of our SPVs, contractors’ all risk policy availed by the EPC contractor during construction, burglary insurance and cash insurance. INTELLECTUAL PROPERTY The Company has entered into a trade mark license agreement (TLA) with GIL under which GIL has granted to us on non-exclusive license to use the licensed trademarks. The trademarks that the Company has been licensed to use are the registered trademarks “Gammon” and the “Gammon logo”. A non-exclusive license to use these trademarks has been granted. Under the TLA, the Company is not permitted to assign, sub-license, transfer, convey or pledge in whole or part, without the prior written consent of GIL. Further, the TLA can be assigned by GIL at any time. The TLA provides for, as consideration for the license, annual payment of ₹100 to GIL. The TLA is valid until March 19, 2017. HUMAN RESOURCES As of June 30, 2014, we have a total of 74 employees, who are professionals holding formal qualifications in various disciplines, including engineering, management, law and accountancy and the others comprise our toll operators and support staff. OFFICES The registered office of the Company is located at Gammon House, Veer Savarkar Marg, Prabhadevi, Mumbai 400 025. Our corporate office is located at Orbit Plaza, 5th Floor, Plot No.952/954, New Prabhadevi Road, Prabhadevi, Mumbai 400025.

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BOARD OF DIRECTORS AND SENIOR MANAGEMENT Directors The composition of our Board of Directors is governed by the provisions of the Companies Act, 2013 and the Listing Agreements with the Indian Stock Exchanges where the shares of our Company are listed. The Articles of Association provide that the number of directors shall not be less than 3 (three) or more than 12 (twelve) unless otherwise approved in a general meeting. Our Company vide postal ballot notice dated July 28, 2014 is seeking the approval of the shareholders to amend the Articles of Association to increase the number of directors on the Board to not more than 15 (fifteen) or such higher number as may be approved by the shareholders. At present, our Company has 8 (eight) Directors including 2 (two) executive Directors and 6 (six) non-executive Directors. Out of 6 (six) non-executive Directors, our Company has a total of 3 (three) Independent Directors. As per the provisions of the Companies Act, 2013, at least two-thirds of the total number of Directors (excluding Independent Directors) are liable to retire by rotation, with one-third of such number of Directors retiring at each annual general meeting. A retiring Director is eligible for re-election. Further, the Independent Directors may be appointed for a term up to five consecutive years and shall be appointed for a maximum of two consecutive terms, after which such Independent Directors shall be eligible for appointment only after the expiration of three years of ceasing to become an Independent Director. Any re-appointment of Independent Directors shall, inter alia, be on the basis of the performance evaluation report and approved by the shareholders by way of special resolution. The following table provides information about the Directors as of the date of this Placement Document:

Sr. No.

Name, Address, DIN, Term and Nationality Age Designation

1. Mr. Naresh Chandra Address: C-4 ,4053 Vasant Kunj, New Delhi 110 070 DIN: 00015833 Term: Liable to retire by rotation Nationality: Indian Occupation: Professional

80 Non-Independent and Non-Executive

Chairman

2. Mr. Himanshu Vinod Parikh Address: 2A, Rituraj, Juhu Military Road ,Opposite Mittal Park Mumbai 400 049 DIN: 00760181 Term: Liable to retire by rotation Nationality: Indian Occupation: Service

55

Vice Chairman, Non- Executive Director

3. Mr. Kishor Kumar Mohanty Address: 23 PH2, Cape Tower, 1925 Chak Garia Hiland Park, Kolkata – 700 094 DIN: 00080498 Term: Re-appointed for a period of three years from April 12, 2014 Nationality: Indian Occupation: Service

57 Managing Director

4. Mr. Parag Parikh Address: 5th Floor, Dahanukar Building, 480 Kalbadevi, Resham Bazar, Mumbai 400 002 DIN: 01438929 Term: Re-appointed for a period of three year with effect from August 25, 2014 Nationality: Indian Occupation: Service

38

Whole time Director & Chief Financial

Officer

160

Sr. No.

Name, Address, DIN, Term and Nationality Age Designation

5. Mr. Abhijit Rajan Address: Rituraj Bunglow, 1, Military Road, Juhu, Mumbai 400 049 DIN: 00177173 Term: Liable to retire by rotation Nationality: Indian Occupation: Business

53

Non- Executive Director

6. Mr. Chandrahas Charandas Dayal Address: Arun,B-7, Narayan, Dabholkar Road,Mumbai – 400 006 DIN: 00178583 Term: Appointed for a period of five years from June 30, 2014 Nationality: Indian Occupation: Professional

70

Independent Director

7. Mr. Sushil Chandra Tripathi Address: 27, Sector 15A ,Noida 201 301 DIN: 00941922 Term: Appointed for a period of five years from June 30, 2014 Nationality: Indian Occupation: Professional

68

Independent Director

8. Ms. Homai A. Daruwalla Address: 781, Flat No.11, 3rd Floor, Mancherji Joshi Road, Parsi Colony, Dadar, Mumbai – 400 014 DIN: 00365880 Term: Appointed for a period of five years from June 30, 2014 Nationality: Indian Occupation: Professional

65 Independent Director

Biographies of the Directors Naresh Chandra, is the Chairman of our Company. He is a non-executive and non-independent director of the Company. He holds a master’s degree in science (mathematics) from Allahabad University. He joined the Indian Administrative Service in May, 1956 and retired as cabinet secretary in 1992. He served as secretary to various ministries to the Government of India including water resources, defence and home affairs. On retirement he was appointed as senior advisor to the prime minister of India. He was made the governor of Gujarat in June, 1995. He was appointed as the ambassador of India to the USA in April, 1996 where he served till February, 2001. He was the chairman of the central government committees on “Corporate Governance and Statutory Audit”, “Private Companies and Limited Liability Partnership‟ and “Civil Aviation Policy and Reforms‟. He was awarded Padma Vibhushan, the second highest civilian award in India, by the Government of India in March, 2007. He joined the Board on October 15, 2007. He has over 30 years of experience in public administration. Himanshu Parikh, is the Vice Chairman of the Company. He holds a bachelor’s degree in commerce from Mumbai University. He was appointed as the executive vice chairman of the Company on July 3, 2010. Later, he was designated as the vice chairman of GIPL on relinquishment of executive functions. He has over 30 years of experience in areas such as purchase, taxation and finance, electronic data processing and general management. Kishor Kumar Mohanty, is the Managing Director of the Company. He holds a bachelor’s degree in technology (electronics and telecommunications) from the National Institute of Technology, Warangal, Andhra Pradesh and a master’s degree in business administration (finance and marketing) from Harvard Business School, Boston. He joined the Board on April 12, 2011 as managing director of the Company. He has over 30 years of managerial experience in various capacities including over 13 years in the infrastructure sector including business modelling and financial engineering. Parag Parikh is a whole time director and Chief Financial Officer of the Company. He holds a master’s degree in commerce from Bombay University and a post graduate management and business administration programme from Mumbai Educational Trust’s Asian Management Development Centre, Mumbai. He has been employed

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with the Company since its inception. He was appointed as the Chief Financial Officer of our Company on May 1, 2008. He joined the Board on August 25, 2011 as a whole time director of our Company. He has over 14 years of experience in project finance, investment banking and strategic planning. Abhijit Rajan, is a non – executive director of our Company. He holds a bachelor’s degree in commerce from Mumbai University. He joined the board of the Promoter in 1991 and was appointed as chairman and managing director of the Promoter with effect from April 17, 2001. He served as the chairman of our Company from August 4, 2001 till September 20, 2013. During this tenure as our Chairman he was also appointed as the Managing Director of our Company from January 23, 2006 till September 20, 2013. He has over 25 years of experience in strategic planning and general management. Sushil Chandra Tripathi is an independent director of our Company. He joined the board in May, 2008. He is a retired Indian Administrative Services officer and has served for over 20 (twenty) years in finance and industry sectors at the state level as the Chief Executive / Secretary and with the central government as the Chief Executive / Joint Secretary / Additional Secretary / Secretary and in a representative capacity at the international level. Chandrahas Charandas Dayal is an independent director of our Company. He is a chartered accountant by profession. He joined the Board on September 19, 2005. He has over 30 years of experience in areas of internal audit, audit, taxation and finance. Ms. Homai A. Daruwalla is an independent director of the Company. She is a qualified Chartered Accountant, was at the helm of affairs of Central Bank of India as Chairperson and Managing Director overseeing the entire operations of the Bank from June 30, 2005 till December 31, 2008. Prior to taking over the reins of Central Bank of India, she was the Executive Director, Oriental Bank of Commerce. She commenced her banking career with Union Bank of India in June 1975. She was a member of Central Sub-Committee on Concurrent Audit of Banks constituted by the Institute of Chartered Accountants of India, as also member of the Committee on Risk Management Practices and Risk Based Supervision formed by the Indian Banks’ Association. She was also the Region of India Director on Board of the Institute of Internal Auditors, Florida, USA for a term of two years. Relationship with other Directors None of the Directors are related to any other Director. Borrowing powers of the Board of Directors As per the special resolution passed by the shareholders way of postal ballot held on July 24, 2012 the Board was given powers to borrow such amounts as it deems appropriate, notwithstanding that the moneys to be borrowed, together with the moneys already borrowed by our Company (apart from the temporary loans obtained from the Company’s bankers in ordinary course of business), if any, may exceed the aggregate paid-up capital of the Company and its free reserves, provided that the total amount of money so borrowed by the Board and outstanding at any point of time shall not exceed a sum of ₹ 1,50,000.00 lakhs. The Company vide postal ballot notice dated July 28, 2014 is seeking the approval of members, by postal ballot, under the Companies Act, 2013 for borrowing and securing such sums of money not exceeding the sum of ₹ 1,50,000.00 lakhs. Interest of the Directors All of the Directors, other than the Executive Directors, may be deemed to be interested to the extent of fees payable to them for attending meetings of the Board or a committee thereof, to the extent of commission of net profits of the Company as well as to the extent of reimbursement of expenses payable to them. The Executive Directors may be deemed interested to the extent of remuneration paid to them for services rendered as the officer of our Company. All of the Directors may also be regarded as interested in our Company to the extent of the Equity Shares held by them and also to the extent of any dividend payable to them and other distributions in respect of such Equity Shares held by them. Other than as disclosed in this Placement Document, there were no outstanding transactions other than in the ordinary course of business undertaken by our Company, in which the Directors were interested parties.

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All Directors may also be regarded as interested in the Equity Shares held by, or subscribed by and allotted to, the companies, firms and trusts, in which they are interested as directors, members, partners or trustees or where the Equity Shares of the Company are held by the relatives of the Directors. Except as otherwise stated in this Placement Document in this regard, our Company has not entered into any contract, agreement or arrangement during the preceding two years from the date of this Placement Document in which any of the Directors are interested, directly or indirectly, and no payments have been made to them in respect of any such contracts, agreements, arrangements which are proposed to be made with them. Furthermore, the Directors have not taken any loans from our Company. Shareholding of Directors The following table sets forth details regarding the shareholding of the Directors as of June 30, 2014:

Name Number of Equity Shares

Percentage shareholding in our Company (%)

Stock option held by our Directors

pursuant to GIPL ESOP 2013

Mr. Abhijit Rajan 60,00,000 0.82 - Mr. Himanshu Parikh 33,14,517 0.45 -

Mr. Parag Parikh 2,32,206 0.03 4,00,000 Mr. Kishor Kumar

Mohanty 1,03,456 0.01 25,00,000

Mr. Chandrahas Charandas Dayal

25,736 0.00 -

Ms. Homai A. Daruwalla 541 0.00 - Terms and Compensation of the Directors Mr. Kishor Kumar Mohanty joined our Board as an additional director on April 12, 2011. The shareholders of our Company at the AGM held on September 26, 2011 approved his appointment as a Managing Director for a period of three years with effect April 12, 2011. He was further re-appointed as the Managing Director of our Company with effect from April 12, 2014 for a period of three years, and the shareholders of our Company pursuant to the AGM dated June 30, 2014 have approved his appointment.

Mr. Parag Parikh joined the Board as an additional director on August 25, 2011, while in the whole time employment of our Company. His appointment as a whole time director of the Company for a period of three years was approved by the shareholders of our Company at the AGM held on September 26, 2011. His re-appointment as the whole time Director of our Company for a period of three years with effect from August 25, 2014 was approved by the shareholders of our Company at the AGM dated June 30, 2014. Pursuant to the resolution dated June 20, 2014 passed by the Board, the sitting fees of our Independent Directors was increased from ₹ 0.2 lakhs to ₹ 0.4 lakhs for each meeting of the Board and for a meeting of any other committee. Our Company also reimburses Independent Directors for travel and related expenses in connection with attending Board and committee meetings.

Remuneration details The remuneration payable to Mr. Kishor Kumar Mohanty as approved in the AGM dated June 30, 2014 (effective from April 12, 2014) is set out below:

Basic salary per month ₹5 lakhs Special allowance per month ₹5 lakhs Fixed allowance per month ₹8.63 lakhs Medical Reimbursement per year ₹0.15 lakhs Leave Travel Concession per year ₹1.20 lakhs Ex-gratia per year one month’s basic salary

Mr. Kishor Kumar Mohanty shall also be entitled to certain perquisites such as accommodation, car and

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telephones, subject, however, to personal long distance calls on telephones and use of car for private purpose being charged to him and in addition to being entitled to the benefit of group medi-claim policy, personal accident policy, provident fund, gratuity, superannuation / annuity fund, sick leave, privilege leave and facility for accumulation and encashment of privilege leave as per the Company rules applicable to all employees of the Company. Mr. Parag Parikh The remuneration payable to Mr. Parag Parikh as approved in the AGM dated June 30, 2014 (effective from August 25, 2014) is set out below:

Basic salary per month ₹1.60 lakhs House rental allowance per month 50% of basic salary Special allowance per month 50% of basic salary Fixed allowance per month ₹3.5311 lakhs Conveyance allowance per month ₹0.3 lakhs Maintenance allowance per month ₹0.15 lakhs Fuel allowance per month ₹0.15 lakhs Medical Reimbursement per year ₹ 0.15 lakhs Leave Travel Concession per year one month’s basic salary Ex-gratia per year one month’s basic salary

Mr. Parag Parikh shall also be entitled to the benefit of group medi-claim policy, personal accident policy, provident fund, gratuity, superannuation / annuity fund, food coupons up to ₹ 0.15 lakhs per year, sick leave, privilege leave and facility for accumulation and encashment of privilege leave as per the Company rules applicable to all employees of the Company. The Company shall also provide telephone, subject to personal long distance calls being charged to him. The following tables set forth all compensation paid by our Company to the Directors till July 31, 2014 (to the extent applicable): Period commencing from January 1, 2014 till July 31, 2014 (to the extent applicable)

Name of the Directors Salary & Commission (₹ in lakhs)

Perquisites (₹ in lakhs)

Sitting Fees (₹ in lakhs )

Total (₹ in lakhs)

Mr. Naresh Chandra 2.40 2.40Mr. Himanshu Parikh 0.80 0.80Mr. Kishor Kumar Mohanty 130.42 8.92 139.34Mr. Parag Parikh 47.88 6.16 54.05 Mr. Abhijit Rajan(1) 1.20 1.20Mr. Chandrahas Charandas Dayal 2.20 2.20Mr. Sushil Chandra Tripathi 2.60 2.60Ms. Homai A. Daruwalla 2.60 2.60(1) Resigned as the Chairman & Managing Director with effect from September 20, 2013. The following tables set forth all compensation paid by our Company to the Directors for the Financial Years ended March 31, 2012, 2013 and the nine month period ended December 31 2013: Financial Year (nine month period) ending December 31, 2013

Name of the Directors Salary &

Commission(₹ in lakhs)

Perquisites (₹ in lakhs)

Sitting Fees (₹ in lakhs)

Total (₹ in lakhs)

Mr. Naresh Chandra 1.40 1.40Mr. Himanshu Parikh 0.60 0.60Mr. Kishor Kumar Mohanty 171.43 18.95 190.38Mr. Parag Parikh 54.28 20.76 75.04Mr. Rajeev Kumar Malhotra(1) 6.96 1.53 8.49

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Name of the Directors Salary & Commission(₹ in lakhs)

Perquisites (₹ in lakhs)

Sitting Fees (₹ in lakhs)

Total (₹ in lakhs)

Mr. Abhijit Rajan(2) 0.20 0.20Mr. Chandrahas Charandas Dayal 2.00 2.00Mr. Sushil Chandra Tripathi 1.80 1.80Ms. Homai A. Daruwalla 1.60 1.60(1) Resigned as a whole time director with effect from May 7, 2013 (2) Resigned as the Chairman & Managing Director with effect from September 20, 2013 Financial Year ending March 31, 2013

Name of the Directors Salary &

Commission(₹ in lakhs )

Perquisites (₹ in lakhs)

Sitting Fees (₹ in lakhs )

Total (₹ in lakhs)

Mr. Naresh Chandra 3.00 1.60 4,60,000.00Mr. Himanshu Parikh - 0.80 80,000.00Mr. Kishor Kumar Mohanty 228.57 29.88 - 258.45Mr. Parag Parikh 72.37 97.63(1) - 170.00Mr. Rajeev Kumar Malhotra 68.13 1.49 - 83.01Mr. Abhijit Rajan - - -Mr. Chandrahas Charandas Dayal 3.00 1.60 4.60Mr. Sushil Chandra Tripathi 3.00 1.60 4.60Ms. Homai A. Daruwalla 3.00 1.00 4.00Mr. Sanjay Sachdev(2) - 0.80 0.80Mr. Kunal Shroff(3) - 0.40 0.40(1) Includes retention bonus of 72.00 lakh

(2) Resigned as Director with effect from September 30, 2012 (3) Resigned as Director with effect from November 8, 2012 Financial Year ending March 31, 2012

Name of the Directors Salary &

Commission(₹ in lakhs)

Perquisites (₹ in lakhs)

Sitting Fees (₹ in lakhs)

Total (₹ in lakhs)

Mr. Naresh Chandra 3.00 - 1.60 4.60Mr. Himanshu Parikh - - 0.60 0.60Mr. Kishor Kumar Mohanty 221.59 28.08 - 249.67Mr. Parag Parikh(1) 43.58 34.68 - 78.26Mr. Rajeev Kumar Malhotra 68.13 14.88 - 83.01Mr. Abhijit Rajan - - - -Mr. Chandrahas Charandas Dayal 3.00 - 1.60 4.60Mr. Sushil Chandra Tripathi 3.00 - 1.60 4.60Ms. Homai A. Daruwalla(2) 1.50 - 0.40 1.90Mr. Sanjay Sachdev 3.00 - 0.60 3.60Mr. Kunal Shroff 3.00 - 0.60 3.60Mr. Parvez Umrigar(3) - - - -(1) includes Incentive for 2010-11of 10.00 Lakhs and Payment in relation to period prior to August 25, 2011 of 16.56

Lakhs. Further he was granted 48,000 ESOP prior to appointment on Board. (2) appointed with effect from November 11, 2011 (3) resigned with effect from August 12, 2011

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Organisational Chart of our Company

Key Managerial Personnel Our Company’s key managerial personnel are as follows: Kishor Kumar Mohanty is the Managing Director of the Company. He holds a bachelor’s degree in technology (electronics and telecommunications) from the National Institute of Technology, Warangal, Andhra Pradesh and a master’s degree in business administration (finance and marketing) from Harvard Business School, Boston. He joined the Board on April 12, 2011 as managing director of the Company. He has over 30 years of managerial experience in various capacities including over 13 years in the infrastructure sector including business modelling and financial engineering. Parag Parikh is a whole time director and Chief Financial Officer of the Company. He holds a master’s degree in commerce from Bombay University and a post graduate management and business administration programme from Mumbai Educational Trust’s Asian Management Development Centre, Mumbai. He has been employed with the Company since its inception. He was appointed as the Chief Financial Officer of our Company on May 1, 2008. He joined the Board on August 25, 2011 as a whole time director of our Company. He has over 14 years of experience in project finance, investment banking and strategic planning G. Sathis Chandran is a graduate in law and is an associate member of the Institute of Company Secretaries of India and has over 30 years of experience in legal and secretarial functions with various organizations.

Shareholding of key managerial personnel

The following table sets forth details regarding the shareholding of the key managerial personnel in our Company as at June 30, 2014:

Name Number of Equity Shares

Percentage shareholding in our Company (%)

Stock option held pursuant to GIPL

ESOP 2013 Mr. Parag Parikh 2,32,206 0.03 4,00,000

Mr. Kishor Kumar Mohanty

1,03,456 0.01 25,00,000

Mr. G. Sathis Chandran 42,891 0.01 2,80,000 Interest of key managerial personnel The key managerial personnel of our Company do not have any interest in our Company other than to the extent of (i) the remuneration or benefits to which they are entitled to as per their terms of appointment; (ii) their equity shareholding in our Company held by them individually or jointly with others, if any and (iii) the stock options held by them pursuant to GIPL ESOP 2013.

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Other than as disclosed in this Placement Document, there were no outstanding transactions other than in the ordinary course of business undertaken by our Company in which the key managerial personnel were interested parties. None of the Directors are related to any of the key managerial personnel of our Company. Senior Management

The senior management Our Group’s top management includes the following members:

Kshitiz R. Bhasker is the head- business development of our Company. He holds a bachelor’s degree in civil engineering, a master’s degree in business administration (finance) and has also studied in L. S. E. (London) for a course in Business Valuations. He joined the Company on September 1, 2004 and has an experience of over 15 years. Prior to joining GIPL he was employed with GIL.

Kaushik Chaudhuri is the chief internal auditor of our Company. He holds a bachelor’s degree in commerce and professional degrees from the Institute of Chartered Accountants of India and Institute of Cost & Work Accountants. He joined the Company on January 12, 2012 and has an experience of over 23 years. Prior to joining the Company he was employed with SREI Infrastructure Finance Limited.

Subhrarabinda Birabar is the head of the port sector. He holds a bachelor’s degree in chemistry, post graduate diploma in system management and post graduate Diploma in Advertising, Marketing & PR, MDP in logistics from IIM-Ahmedabad. He joined the Company on July 25, 2011 and has an experience of over 20 years. Prior to joining the Company, he was Country Head for Jebel Ali Free Zone International-India and prior to that with Larsen & Toubro Limited. Mahesh Fogla is Deputy General Manager - Account and Tax team of the Company since October 2009. He has done his bachelor’s degree in commerce from St. Xavier’s College (Kolkata) and also a fellow member of The Institute of Chartered Accountant of India and an associate member of The Institute of Cost Accountant of India. He has more than 18 years of wide experience in areas such as account, tax, finance, cost and insurance. Prior to joining the Company, he was associated with Mahindra & Mahindra, Raymond Limited, Trent (Tata Retail Enterprise) Limited. Prakash Naik is heading the legal department of our Company since March 2012. He holds a degree in science and post graduate degree in law from Karnataka University. He was holding the post of Chief General Manager (Legal) in IDBI Bank. Prior to joining our Company, he had worked in Public Sector Banks and Financial Institution in various capacity and 35 years of valuable experience in the legal department in legal & advisory functions including documentation, litigation matters, drafting and vetting.

Atulesh Chandra Sharma is the general manager, technical. He holds a bachelor’s degree in civil engineering. He joined the Company on March 18, 2013 and has an experience of over 26 years. Prior to joining the Company he was employed with Sheladia Associates Inc.

Pavneet Singh Sethi is the chief operating officer (operation, maintenance & tolling). He holds a bachelor’s degree in Electronics Engineering. He joined the Company on April 1, 2013 and has an experience of over 19 years. Prior to joining the Company he was employed with Soma Isolux.

Bibhudutta Satpathy is the head of roads (maintenance & safety). He holds a bachelor’s degree in civil engineering and a diploma in construction management. He joined our Company on June 6, 2012 and has an experience of over 23 years. Prior to joining the Company he was employed with Welspun Projects Limited.

M.S.S.V. Ramanamurthy is the head of operations for the road business. He holds a bachelor’s and a master’s degree in commerce and is a Certified Associate of Indian Institute of Bankers. He was with the Canara Bank for nearly 20 years. He joined our Company on May 27, 2011 and has an experience of over 11 years. Prior to joining our Company he was employed with GMR Highways Private Limited. Corporate governance

Except as disclosed in the Placement Document, our Company has been complying with the requirements of all applicable corporate governance norms, including the Equity Listing Agreements and the SEBI Regulations, in

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respect of corporate governance including constitution of the Board and committees thereof. The Board of Directors presently consists of 8 (eight) Directors. In compliance with the requirements of the Listing Agreement, the Board of Directors consists of 3 (three) Independent Directors. As the Chairman of our Company is a non-executive, non-promoter Director of our Company, at least one third of the Board is required to consist of Independent Directors in accordance with Clause 49 of the Equity Listing Agreements. Our Company is compliant with the requirements of Clause 49 of the Equity Listing Agreements as 3 of our Directors are eligible to be considered as Independent Directors under the Equity Listing Agreement. Committees of the Board Our Company has constituted the following committees of Directors namely: (i) Audit Committee; (ii) Stakeholders Relationship Committee (iii) Nomination and Remuneration Committee (iv) Compensation Committee; (v) Project Committee; (vi) Projects Review Committee; (vii) QIP Committee; and (viii) Corporate Social Responsibility Committee. The following table sets forth the details of the members of the aforesaid committees as of the date of this Placement Document:

Committee Members Audit Committee (a) Mr. Chandrahas Charandas Dayal, (Chairman);

(b) Mr. Naresh Chandra; (c) Mr. Sushil Chandra Tripathi; (d) Ms. Homai A. Daruwalla Company Secretary is the secretary to the Committee

Stakeholders Relationship Committee (a) Mr. Himanshu Parikh, (Chairman); (b) Mr. Chandrahas Charandas Dayal

Nomination and Remuneration Committee (a) Mr. Chandrahas Charandas Dayal, (Chairman); (b) Mr. Sushil Chandra Tripathi ; (c) Ms. Homai A. Daruwalla

Compensation Committee (a) Mr. Chandrahas Charandas Dayal, (Chairman); (b) Mr. Kishor Kumar Mohanty; (c) Ms. Homai A. Daruwalla;

Project Committee (a) Mr. Abhijit Rajan; (b) Mr. Himanshu Parikh; (c) Mr. Kishor Kumar Mohanty

Projects Review Committee (a) Mr. Chandrahas Charandas Dayal; (c) Mr. Sushil Chandra Tripathi

QIP Committee (a) Mr. Kishor Kumar Mohanty; (b) Mr. Parag Parikh; (c) Mr. Himanshu Parikh

Corporate Social Responsibility Committee (a) Ms. Homai A. Daruwalla; (b) Mr. Kishor Kumar Mohanty; (c) Mr.Parag Parikh.

Policy on disclosures and internal procedure for prevention of insider trading

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Regulation 12(1) of the Insider Trading Regulations applies to our Company and its employees and requires our Company to implement a code of internal procedures and conduct for the prevention of insider trading. Our Company has implemented a code of conduct for prevention of insider trading in accordance with the Insider Trading Regulations. As per the code of internal procedures and conduct for the prevention of insider trading adopted by our Company, the Company Secretary of our Company, shall be the compliance officer of our Company for the purposes of this code. Other confirmations Except as otherwise stated in this Placement Document, none of the Directors, Promoters or key managerial personnel of our Company have any financial or other material interest in the Issue. Related Party Transactions

For details in relation to the related party transactions entered by our Company during the last three Financial Years, as per the requirements under ‘Accounting Standard 18 – Related Party Transaction’ issued by the Institute of Chartered Accountants of India, see the section “Financial Statements” on pages F-1 to F-125.

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PRINCIPAL SHAREHOLDERS

The following table sets forth the details regarding the shareholding pattern of our Company, as on June 30, 2014:

Category Code (I)

Category of Shareholder (II)

Number of Shareholders (III)

Total number of shares (IV)

Number of shares held in dematerialized form (V)

Total shareholding as a percentage of total number of shares

Shares Pledged or otherwise encumbered

As a percentage of(A+B)

(VI)

As a percentage of (A+B+C) (VII)

Number of shares (VIII)

As a percentage (IX) = (VIII)/(IV)*100

(A) Shareholding of Promoter and Promoter Group

1 Indian

(a) Individuals/ Hindu Undivided Family

0 0 0 0.00 0.00 0 0

(b) Central Government/ State Government

0 0 0 0.00 0.00 0 0

(c) Bodies Corporate

3* 52,80,00,000 52,80,00,000 71.93 71.93 43,02,86,305 81.49

(d) Financial Institutions/ Banks

- - - 0.00 0.00 0 0

(e) Any Others(Specify)

(e-i) Promoter Group

1 2,24,00,000 2,24,00,000 3.05 3.05 0 0

Sub Total(A)(1)

4 55,04,00,000 55,04,00,000 74.98 74.98 43,02,86,305 78.18

2 Foreign

a Individuals (Non-Residents Individuals/ Foreign Individuals)

0 0 0 0.00 0.00 0 0

b Bodies Corporate

0 0 0 0.00 0.00 0 0

c Institutions 0 0 0 0.00 0.00 0 0

d Any Others(Specify)

0 0 0 0.00 0.00 0 0

Sub Total(A)(2)

0 0 0 0.00 0.00 0 0

Total Shareholding

4 55,04,00,000 55,04,00,000 74.98 74.98 43,02,86,305 78.18

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Category Code (I)

Category of Shareholder (II)

Number of Shareholders (III)

Total number of shares (IV)

Number of shares held in dematerialized form (V)

Total shareholding as a percentage of total number of shares

Shares Pledged or otherwise encumbered

As a percentage of(A+B)

(VI)

As a percentage of (A+B+C) (VII)

Number of shares (VIII)

As a percentage (IX) = (VIII)/(IV)*100

of Promoter and Promoter Group (A)= (A)(1)+(A)(2)

(B) Public shareholding

1 Institutions

(a) Mutual Funds/ UTI

4 2,56,88,916 2,56,88,916 3.50 3.50

(b) Financial Institutions /

Banks

5 71,43,514 71,43,514 0.97 0.97

(c) Central Government/ State Government

0 0 0 0.00 0.00

(d) Venture Capital Funds

0 0 0 0.00 0.00

(e) Insurance Companies

0 0 0 0.00 0.00

(f) Foreign Institutional Investors

7 5,54,06,852 5,54,06,852 7.55 7.55

(g) Foreign Venture Capital Investors

0 0 0 0.00 0.00

(h) Qualified Foreign Investor

0 0 0 0.00 0.00

(i) Any Other (specify)

0 0 0 0.00 0.00

Sub-Total (B)(1)

16 8,82,39,282 8,82,39,282 12.02 12.02

B 2 Non-institutions

(a) Bodies Corporate

514 4,02,36,816 4,02,36,816 5.48 5.48

(b) Individuals

I Individual shareholders holding nominal share capital up to ₹ 1 lakh

39,631 3,40,21,394 3,40,19,714 4.63 4.63

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Category Code (I)

Category of Shareholder (II)

Number of Shareholders (III)

Total number of shares (IV)

Number of shares held in dematerialized form (V)

Total shareholding as a percentage of total number of shares

Shares Pledged or otherwise encumbered

As a percentage of(A+B)

(VI)

As a percentage of (A+B+C) (VII)

Number of shares (VIII)

As a percentage (IX) = (VIII)/(IV)*100

II ii. Individual shareholders holding nominal share capital in excess of ₹ 1 lakh.

40 64,91,830 64,91,830 0.88 0.88

(C) Any Other (specify)

(c-i) Clearing Member

341 15,81,534 15,81,509 0.22 0.22

(c-ii) Office Bearers 94 12,14,956 12,14,956 0.17 0.17

Foreign Nationals

1 2,059 2,059 0.00 0.00

NRI (Repat) 373 18,74,474 18,74,474 0.26 0.26

NRI (Non Repat)

87 2,83,576 2,83,576 0.04 0.04

Directors/Relatives

6 96,76,456 96,76,456 1.32 1.32

Trusts 3 4,061 4,061 0.00 0.00

Sub-Total (B)(2)

41,090 9,53,87,156 9,53,85,451 13.00 13.00

(B) Total Public Shareholding (B)= (B)(1)+(B)(2)

41,106 18,36,26,438 18,36,24,733 25.02 25.02 NA NA

TOTAL (A)+(B)

41,110 73,40,26,438 73,40,24,733 100 100 43,02,86,305 58.62

(C) Shares held by Custodians and against which Depository Receipts have been issued

1 Promoter and Promoter Group

0 0 0 0.00 0.00 NA NA

2 Public 0 0 0 0.00 0.00 NA NA

Sub Total (C)

GRAND TOTAL (A)+(B)+(C)

41,110 73,40,26,438 73,40,24,733 100 100 43,02,86,305 58.62

* denotes three different folios held by GIL.

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The shareholding pattern of persons belonging to the category “Promoter and Promoter Group” is set forth in the table below as on June 30, 2014:

Sr. No.(I)

Name of the shareholder

(II)

Details of shares held Encumbered shares Details of Warrants

Details of convertible securities

Total shares (including underlying shares assuming full conversion of warrants and convertible securities) as a % of diluted share capital (XII)

Number of Shares held (III)

As a % of grand total (A)+(B)+(C) (IV)

Number (V)

As a percentage (VI) =(V)/(III)*100

As a % of grand total (A)+(B)+(C) of sub-clause (I) (a) (VII)

Number of warrants held (VIII)

As a % total number of warrants of the same class (IX)

Number of convertible securities held (X)

As a % total number of convertible securities of the same class (XI)

1 GIL 52,80,00,000*

71.93 43,02,86,305

81.49 58.62 0 0 0 0 71.93

2 Gactel Turnkey Projects Limited (erstwhile Gammon Cooling Towers Ltd)

2,24,00,000

3.05 0 0 0 3.05

TOTAL 55,04,00,000

74.98 43,02,86,305

78.18 58.62 74.98

* held in three different folios by GIL.

The following table sets forth the details regarding the shareholding of the “Public” category and holding more than 1% of the total number of Equity Shares as of June 30, 2014 is detailed in the table below:

Sr. No.

Name of the shareholder

Number of shares

Shares as a percentage of total number of shares {i.e., Grand Total (A)+(B)+(C) indicated in Statement at para (I)(a) above}

Details of Warrants Details of convertible securities Total shares (including underlying shares assuming full conversion of warrants and convertible securities) as a % of diluted share capital

Number of warrants held

As a % total number of warrants of the same class

Number of convertible securities held

As a % total number of convertible securities of the same class

1 SBI Infrastructure Fund

2,05,93,967 2.81 0 0 0 0 2.81

2 HSBC Global Investment Funds A/c HSBC Global Investment Funds Mauritius Limited

1,55,07,549 2.11 0 0 0 0 2.11

3 Frontier Realty Private Limited

1,43,81,246 1.96 0 0 0 0 1.96

4 BNP Paribas Arbitrage

1,15,75,314 1.58 0 0 0 0 1.58

5 Emerging India Focus Fund

1,01,32,856 1.38 0 0 0 0 1.38

6 Copthall Mauritius Investment

92,98,764 1.27 0 0 0 0 1.27

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Ltd.

7 Brij Real Estate And Property Private Limited

89,54,673 1.22 0 0 0 0 1.22

TOTAL 9,04,44,369 12.32 12.32

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ISSUE PROCEDURE

The following is a summary intended to present a general outline of the procedure relating to the application, payment, Allocation and Allotment of the Equity Shares to be issued pursuant to the Issue. The procedure followed in the Issue may differ from the one mentioned below, and investors are presumed to have apprised themselves of the same from our Company or the Book Running Lead Managers. Investors are advised to inform themselves of any restrictions or limitations that may be applicable to them. See sections entitled “Selling Restrictions” and “Transfer Restrictions” on pages 186 and 191, respectively. Qualified Institutions Placement The Issue is being made to QIBs in reliance upon Chapter VIII of the SEBI Regulations and Section 42 of the Companies Act, 2013, through the mechanism of a QIP. Under Chapter VIII of the SEBI Regulations and Section 42 of the Companies Act, 2013, a company may issue equity shares to QIBs provided that certain conditions are met by the company. Certain of these conditions are set out below:

the shareholders of the issuer have passed a special resolution approving such QIP. Such special

resolution must specify that the allotment of securities is proposed to be made pursuant to the QIP;

equity shares of the same class of such issuer, which are proposed to be allotted through the QIP, are listed on a recognised stock exchange in India having nation-wide trading terminals for a period of at least one year prior to the date of issuance of notice to its shareholders for convening the meeting to pass the above-mentioned special resolution;

the aggregate of the proposed issue and all previous qualified institutions placements made by the issuer in the same financial year does not exceed five times the net worth (as defined in the SEBI Regulations) of the issuer as per the audited balance sheet of the previous financial year;

the issuer shall be in compliance with the minimum public shareholding requirements set out in the SCRR;

the issuer shall have completed allotments with respect to any offer or invitation made by the issuer or shall have withdrawn or abandoned that offer or invitation made by the issuer;

the issuer shall offer to each Allottee at least such number of the securities in the issue which would aggregate to ₹ 20,000 calculated at the face value of the securities

At least 10% of the equity shares issued to QIBs must be allotted to Mutual Funds, provided that, if this portion or any part thereof to be allotted to Mutual Funds remains unsubscribed, it may be allotted to other QIBs.

Bidders are not allowed to withdraw their Bids after the Bid/Issue Closing Date.

Additionally, there is a minimum pricing requirement under the SEBI Regulations. The Floor Price shall not be less than the average of the weekly high and low of the closing prices of the Equity Shares quoted on the stock exchange during the two weeks preceding the Relevant Date. However, a discount of up to 5% of the Floor Price is permitted in accordance with the provisions of the SEBI Regulations.

The “Relevant Date” referred to above, for Allotment, will be the date of the meeting in which the Board or the committee of Directors duly authorised by the Board decides to open the Issue and “stock exchange” means any of the recognised stock exchanges in India on which the Equity Shares of the issuer of the same class are listed and on which the highest trading volume in such Equity Shares has been recorded during the two weeks immediately preceding the Relevant Date.

Our Company has applied for and received the in-principle approval of the Stock Exchanges under Clause 24 (a) of the Equity Listing Agreements for the listing of the Equity Shares on the Stock Exchanges. Our Company has also delivered a copy of the Preliminary Placement Document and this Placement Document to the Stock Exchanges.

Our Company shall also make the requisite filings with the RoC and SEBI within the stipulated period as required under the Companies Act, 2013 and the Companies (Prospectus and Allotment of Securities) Rules,

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2014.

The Issue has been authorized by (i) the Board pursuant to a resolution passed on June 20, 2014, and (ii) the shareholders, pursuant to a resolution passed under section 42 and 62 of the Companies Act, 2013 on July 15, 2014.

The Equity Shares will be Allotted within 12 months from the date of the shareholders’ resolution approving the QIP and within 60 days from the date of receipt of subscription money from the successful Bidders. For details of refund of application money, see the section “Issue Procedure – Pricing and Allocation – Designated Date and Allotment of Equity Shares”.

The Equity Shares issued pursuant to the QIP must be issued on the basis of the Preliminary Placement Document and this Placement Document shall contain all material information including the information specified in Schedule XVIII of the SEBI Regulations and the requirements prescribed under Form PAS-4. The Preliminary Placement Document and this Placement Document are private documents provided to only select investors through serially numbered copies and are required to be placed on the website of the concerned Stock Exchanges and of our Company with a disclaimer to the effect that it is in connection with an issue to QIBs and no offer is being made to the public or to any other category of investors.

The minimum number of allottees for each QIP shall not be less than:

two, where the issue size is less than or equal to ₹ 2,50,00,00,000 ; and

five, where the issue size is greater than ₹ 2,50,00,00,000 . No single allottee shall be allotted more than 50.00% of the issue size. QIBs that belong to the same group or that are under common control shall be deemed to be a single allottee. For details of what constitutes “same group” or “common control”, see “Issue Procedure—Application Process—Application Form” on page 179. Securities allotted to a QIB pursuant to a QIP shall not be sold for a period of one year from the date of allotment except on the floor of a recognised stock exchange in India. Allotments made to FVCIs, VCFs and AIFs in the Issue are subject to the rules and regulations that are applicable to them, including in relation to lock-in requirements.

The Equity Shares are being offered and sold outside the United States in off-shore transactions in reliance on Regulation S under the Securities Act. For a description of certain restrictions on transfer of the Equity Shares, see “Transfer Restrictions”.

The Equity Shares have not been and will not be registered, listed or otherwise qualified in any other jurisdiction outside India and may not be offered or sold, and Bids may not be made by persons in any such jurisdiction, except in compliance with the applicable laws of such jurisdiction.

Issue Procedure 1. Our Company and the Book Running Lead Managers shall circulate serially numbered copies of the

Preliminary Placement Document and the serially numbered Application Form, either in electronic or physical form, to the QIBs and the Application Form will be specifically addressed to such QIBs. In terms of Section 42(7) of the Companies Act, 2013, our Company shall maintain complete records of the QIBs to whom the Preliminary Placement Document and the serially numbered Application Form have been dispatched. Our Company will make the requisite filings with the RoC and SEBI within the stipulated time period as required under the Companies Act, 2013.

2. Unless a serially numbered Preliminary Placement Document along with the serially numbered Application Form is addressed to a particular QIB, no invitation to subscribe shall be deemed to have been made to such QIB. Even if such documentation were to come into the possession of any person other than the intended recipient, no offer or invitation to offer shall be deemed to have been made to such person and any application that does not comply with this requirement shall be treated as invalid.

3. QIBs may submit an Application Form, including any revisions thereof, during the Bidding Period to

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the Book Running Lead Managers.

4. QIBs will be, inter alia, required to indicate the following in the Application Form:

full name of the QIB to whom Equity Shares are to be Allotted;

number of Equity Shares Bid for;

price at which they are agreeable to subscribe for the Equity Shares, provided that QIBs may also indicate that they are agreeable to submit a Bid at “Cut-off Price”; which shall be any price as may be determined by our Company in consultation with the Book Running Lead Managers at or above the Floor Price or the Floor Price net of such discount as approved in accordance with SEBI Regulations;

details of the depository account to which the Equity Shares should be credited; and

a representation that it is either (i) outside the United States and (ii) it has agreed to certain other representations set forth in the Application Form.

Note: Each sub-account of an FII other than a sub-account which is a foreign corporate or a foreign individual will be considered as an individual QIB and separate Application Forms would be required from each such sub-account for submitting Bids.

5. Once a duly completed Application Form is submitted by a QIB, such Application Form constitutes an

irrevocable offer and cannot be withdrawn after the Bid/Issue Closing Date. The Bid/Issue Closing Date shall be notified to the Stock Exchanges and the QIBs shall be deemed to have been given notice of such date after receipt of the Application Form.

6. The Bids made by asset management companies or custodians of Mutual Funds shall specifically state the names of the concerned schemes for which the Bids are made. In case of a Mutual Fund, a separate Bid can be made in respect of each scheme of the Mutual Fund registered with SEBI. Upon receipt of the Application Form, after the Bid/Issue Closing Date, our Company shall determine the final terms, including the Issue Price of the Equity Shares to be issued pursuant to the Issue in consultation with the Book Running Lead Managers. Upon determination of the final terms of the Equity Shares, the Book Running Lead Managers will send the serially numbered CAN along with the Placement Document to the QIBs who have been Allocated the Equity Shares. The dispatch of a CAN shall be deemed a valid, binding and irrevocable contract for the QIB to pay the entire Issue Price for all the Equity Shares Allocated to such QIB. The CAN shall contain details such as the number of Equity Shares Allocated to the QIB and payment instructions including the details of the amounts payable by the QIB for Allotment of the Equity Shares in its name and the Pay-In Date as applicable to the respective QIB. Please note that the Allocation will be at the absolute discretion of our Company and will be based on the recommendation of the Book Running Lead Managers.

7. Pursuant to receiving a CAN, each QIB shall be required to make the payment of the entire application monies for the Equity Shares indicated in the CAN at the Issue Price, only through electronic transfer to our Company’s designated bank account by the Pay-In Date as specified in the CAN sent to the respective QIBs. No payment shall be made by QIBs in cash. Please note that any payment of application money for the Equity Shares shall be made from the bank accounts of the relevant QIBs applying for the Equity Shares. Monies payable on Equity Shares to be held by joint holders shall be paid from the bank account of the person whose name appears first in the application. Pending Allotment, all monies received for subscription of the Equity Shares shall be kept by our Company in a separate bank account with a scheduled bank and shall be utilised only for the purposes mentioned in the Preliminary Placement Dcoument.

8. Upon receipt of the application monies from the QIBs, our Company shall Allot Equity Shares as per the details in the CANs sent to the QIBs.

9. After passing the resolution for Allotment and prior to crediting the Equity Shares into the depository participant accounts of the successful Bidders, our Company shall apply to the Stock Exchanges for listing approvals. Our Company will intimate to the Stock Exchanges the details of the Allotment and

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apply for approvals for listing of the Equity Shares on the Stock Exchanges prior to crediting the Equity Shares into the beneficiary account maintained with the Depository Participant by the QIBs.

10. After receipt of the listing approvals of the Stock Exchanges, our Company shall credit the Equity Shares Allotted pursuant to this Issue into the Depository Participant accounts of the respective Allottees.

11. Our Company will then apply for the final trading approvals from the Stock Exchanges.

12. The Equity Shares that would have been credited to the beneficiary account with the Depository Participant of the QIBs shall be eligible for trading on the Stock Exchanges only upon the receipt of final trading approvals from the Stock Exchanges.

13. Upon receipt of intimation of final trading and listing approval from the Stock Exchanges, our Company shall inform the Allottees of the receipt of such approval. Our Company and the Book Running Lead Managers shall not be responsible for any delay or non-receipt of the communication of the final trading and listing permissions from the Stock Exchanges or any loss arising from such delay or non-receipt. Final listing and trading approvals granted by the Stock Exchanges are also placed on their respective websites. QIBs are advised to apprise themselves of the status of the receipt of the permissions from the Stock Exchanges or our Company.

Qualified Institutional Buyers Only QIBs as defined in Regulation 2(1)(zd) of the SEBI Regulations and not otherwise excluded pursuant to Regulation 86(1)(b) of the SEBI Regulations are eligible to invest. Currently, under Regulation 2(1)(zd) of the SEBI Regulations, a QIB means:

alternate investment funds registered with SEBI

Eligible FPIs;

foreign venture capital investors registered with SEBI;

insurance companies registered with Insurance Regulatory and Development Authority;

insurance funds set up and managed by army, navy or air force of the Union of India;

insurance funds set up and managed by the Department of Posts, India;

multilateral and bilateral development financial institutions;

Mutual Fund registered with SEBI;

pension funds with minimum corpus of ₹25,00,00,000;

provident funds with minimum corpus of ₹25,00,00,000;

public financial institutions as defined in Section 4A of the Companies Act, 1956 (Section 2(72) of the

Companies Act, 2013);

scheduled commercial banks;

state industrial development corporations;

the National Investment Fund set up by resolution no. F. No. 2/3/2005-DDII dated November 23, 2005 of the Government published in the Gazette of India; and

venture capital funds registered with SEBI. In terms of the SEBI FPI Regulations, an FII who holds a valid certificate of registration from SEBI shall be

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deemed to be a registered FPI until the expiry of the block of three years for which fees have been paid as per the SEBI FII Regulations. An FII shall not be eligible to invest as an FII after registering as an FPI under the SEBI FPI Regulations. In terms of the SEBI FPI Regulations, the issue of Equity Shares to a single FPI or an investor group (which means the same set of ultimate beneficial owner(s) investing through multiple entities) is not permitted to exceed 9.99 % of our post-Issue Equity Share capital. Further, in terms of the FEMA Regulations, the total holding by each FPI shall be below 10% of the total paid-up Equity Share capital of our Company and the total holdings of all FPIs put together shall not exceed 24% of the paid-up Equity Share capital of our Company. The aggregate limit of 24% may be increased up to the sectoral cap by way of a resolution passed by the Board of Directors followed by a special resolution passed by the Shareholders of our Company and subject to prior intimation to RBI. In terms of the FEMA Regulations, for calculating the aggregate holding of FPIs in a company, holding of all registered FPIs as well as holding of FIIs (being deemed FPIs) shall be included. The existing individual and aggregate investment limits an FII or sub account in our Company is 10% and 24% of the total paid-up Equity Share capital of our Company, respectively.

FPIs are permitted to participate in the Issue subject to compliance with conditions and restrictions which may be specified by the Government from time to time.

Eligible non-resident QIBs can participate in the Issue under Schedule 1 of the FEMA Transfer Regulations.

FIIs (other than a sub-account which is a foreign corporate or a foreign individual) and Eligible FPIs are permitted to participate through the portfolio investment scheme under Schedule 2 and Schedule 2A of FEMA Transfer Regulations respectively, in this Issue. FIIs and Eligible FPIs are permitted to participate in the Issue subject to compliance with all applicable laws and such that the shareholding of the FPIs do not exceed specified limits as prescribed under applicable laws in this regard.

Eligible FPIs are permitted to participate in the Issue subject to compliance with conditions and restrictions which may be specified by the Government from time to time.

An FII who holds a valid certificate of registration from SEBI shall be deemed to be an FPI until the expiry of the block of three years for which fees have been paid as per the SEBI FII Regulations. An FII or sub-account (other than a sub-account which is a foreign corporate or a foreign individual) may participate in the Issue, until the expiry of its registration as a FII or sub-account, or until it obtains a certificate of registration as FPI, whichever is earlier. If the registration of an FII or sub-account has expired or is about to expire, such FII or sub-account may, subject to payment of conversion fees under the SEBI FPI Regulations, participate in the Issue. An FII or sub-account shall not be eligible to invest as an FII after registering as an FPI under the SEBI FPI Regulations.

In terms of the FEMA Transfer Regulations, for calculating the aggregate holding of FPIs in a company, holding of all registered FPIs as well as holding of FIIs (being deemed FPIs) shall be included.

Restriction on Allotment Under Regulation 86(1)(b) of the SEBI Regulations, no Allotment shall be made pursuant to the Issue, either directly or indirectly, to any QIB being, or any person related to, the Promoters. QIBs which have all or any of the following rights shall be deemed to be persons related to the Promoters:

rights under a shareholders’ agreement or voting agreement entered into with the Promoters or persons

related to the Promoters;

veto rights; or

a right to appoint any nominee director on the Board. Provided, however, that a QIB which does not hold any shares in our Company and which has acquired the aforesaid rights in the capacity of a lender shall not be deemed to be related to the Promoters. Our Company and the Book Running Lead Managers are not liable for any amendment or modification or change to applicable laws or regulations, which may occur after the date of this Placement Document. QIBs are

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advised to make their independent investigations and satisfy themselves that they are eligible to apply. QIBs are advised to ensure that any single application from them does not exceed the investment limits or maximum number of Equity Shares that can be held by them under applicable law or regulation or as specified in this Placement Document. Further, QIBs are required to satisfy themselves that their Bids would not eventually result in triggering a tender offer under the Takeover Regulations. Note: Affiliates or associates of the Book Running Lead Managers who are QIBs may participate in the Issue in compliance with applicable laws. Application Process Application Form QIBs shall only use the serially numbered Application Forms (which are addressed to them) supplied by our Company and/or the Book Running Lead Managers in either electronic form or by physical delivery for the purpose of making a Bid (including revision of a Bid) in terms of the Preliminary Placement Document. By making a Bid (including the revision thereof) for Equity Shares through Application Forms and pursuant to the terms of the Preliminary Placement Document, the QIB will be deemed to have made the following representations and warranties and the representations, warranties and agreements made under the sections entitled “Notice to Investors”, “Representations by Investors”, “Selling Restrictions” and “Transfer Restrictions” on pages 1, 3, 186, and 191, respectively: 1. The QIB confirms that it is a QIB in terms of Regulation 2(1)(zd) of the SEBI Regulations and is not

excluded under Regulation 86 of the SEBI Regulations, has a valid and existing registration under the applicable laws in India (as applicable) and is eligible to participate in this Issue;

2. The QIB confirms that it is not a Promoter and is not a person related to the Promoter, either directly or indirectly and its Application Form does not directly or indirectly represent the Promoter or Promoter Group or persons related to the Promoter;

3. The QIB confirms that it has no rights under a shareholders’ agreement or voting agreement with the Promoter or persons related to the Promoter, no veto rights or right to appoint any nominee director on the Board other than those acquired in the capacity of a lender which shall not be deemed to be a person related to the Promoter;

4. The QIB acknowledges that it has no right to withdraw its Bid after the closure of the Bid/Issue;

5. The QIB confirms that if Equity Shares are Allotted through this Issue, it shall not, for a period of one year from Allotment, sell such Equity Shares otherwise than on the Stock Exchanges;

6. The QIB confirms that the QIB is eligible to Bid and hold Equity Shares so Allotted. The QIB further confirms that the holding of the QIB, does not and shall not, exceed the level permissible as per any applicable regulations applicable to the QIB;

7. The QIB confirms that its Bids would not eventually result in triggering a tender offer under the Takeover Regulations;

8. The QIB confirms that to the best of its knowledge and belief, the number of Equity Shares Allotted to it pursuant to the Issue, together with other Allottees that belong to the same group or are under common control, shall not exceed 50.00% of the Issue. For the purposes of this representation: a. The expression “belongs to the same group” shall derive meaning from the concept of

“companies under the same group” as provided in sub-section (11) of Section 372 of the Companies Act, 1956; and

b. “Control” shall have the same meaning as is assigned to it by Regulation 2(1)(c) of the Takeover Regulations;

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9. The QIBs shall not undertake any trade in the Equity Shares credited to its beneficiary account maintained with the Depository Participant until such time that the final listing and trading approvals for the Equity Shares are issued by the Stock Exchanges.

QIBs MUST PROVIDE THEIR DEPOSITORY ACCOUNT DETAILS, PAN, THEIR DEPOSITORY PARTICIPANT’S NAME, DEPOSITORY PARTICIPANT IDENTIFICATION NUMBER AND BENEFICIARY ACCOUNT NUMBER IN THE APPLICATION FORM. QIBS MUST ENSURE THAT THE NAME GIVEN IN THE APPLICATION FORM IS EXACTLY THE SAME AS THE NAME IN WHICH THE DEPOSITORY ACCOUNT IS HELD. FOR THIS PURPOSE, ELIGIBLE SUB ACCOUNTS OF AN FII WOULD BE CONSIDERED AS AN INDEPENDENT QIB. IF SO REQUIRED BY THE BRLMs, THE QIB SUBMITTING A BID, ALONG WITH THE BID CUM APPLICATION FORM, WILL ALSO HAVE TO SUBMIT REQUISITE DOCUMENT(S) TO THE BRLMs TO EVIDENCE THEIR STATUS AS A "QIB" AS DEFINED HEREINABOVE. IF SO REQUIRED BY THE BRLMs, COLLECTION BANK(S) OR ANY STATUTORY OR REGULATORY AUTHORITY IN THIS REGARD, INCLUDING AFTER PLACEMENT CLOSURE, THE QIB SUBMITTING A BID AND/OR BEING ALLOTTED EQUITY SHARES IN THE PLACEMENT, WILL ALSO HAVE TO SUBMIT REQUISITE DOCUMENT(S) TO FULFILL THE KNOW YOUR CUSTOMER (KYC) NORMS. Demographic details such as address and bank account will be obtained from the Depositories as per the Depository Participant account details given above. The submission of an Application Form by a QIB shall be deemed a valid, binding and irrevocable offer for the QIB to pay the entire Issue Price for the Equity Shares (as indicated by the CAN) and becomes a binding contract on the QIB upon issuance of the CAN by our Company in favour of the QIB. Submission of Application Form All Application Forms must be duly completed with information including the number of Equity Shares applied for. All Application Forms duly completed along with payment and a copy of the PAN card or PAN allotment letter shall be submitted to the Book Running Lead Managers either through electronic form or through physical delivery at the following address:

Name of the Book Running Lead Manager

Address Contact person Email Phone (telephone and fax)

Inga Capital Private Limited

21st Floor, Naman Midtown, A wing, Senapati Bapat Marg, Elphinstone (West), Mumbai 400013

Mr. S. Karthikeyan project.jupiter@ingacapital.com +91 22 2498 2919 (landline)

+91 22 2498 2956 (fax)

IDFC Securities Limited

Naman Chambers, C-32, G-Block, Bandra-Kurla Complex, Bandra (East), Mumbai – 400 051

Mr. Venkatraghavan S / Mr. Akshay Bhandari

projectjupiter.IDFC@idfc.com +91 22 6622 2600 (landline) +91 22 6622 2501 (fax)

Equirus Capital Private Limited

Fortune 2000, 4th Floor, ‘A’ Wing, Bandra Kurla Complex, Bandra (East), Mumbai-400 051

Mr. Abhay Bhalerao/ Mr. Munish Aggarwal

project.jupiter@equirus.com +91 22 2653 0600 (landline) +91 22 2653 0601 (fax)

ICICI Securities Limited

ICICI Centre, H.T. Parekh Marg, Churchgate, Mumbai 400 020

Ms. Payal Kulkarni / Mr. Gaurav Sood

Project.jupiter@icicisecurities.com +91 22 2288 2460 (landline)

+91 22 2282 6580 (fax)

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Maharashtra, India

The Book Running Lead Managers shall not be required to provide any written acknowledgement of the same. Bid/Issue Programme Bidding Period: BID/ISSUE OPENS ON SEPTEMBER 1, 2014 BID/ISSUE CLOSES ON SEPTEMBER 4, 2014 Permanent Account Number or PAN Each QIB should mention its PAN allotted under the IT Act in the Application Form. Applications without this information will be considered incomplete and are liable to be rejected. QIBs should not submit the GIR number instead of the PAN as the Application Form is liable to be rejected on this ground. Pricing and Allocation Build up of the Book The QIBs shall submit their Bids (including the revision of bids) within the Bidding Period to the Book Running Lead Managers. Such Bids cannot be withdrawn after the Bid/Issue Closing Date. The book shall be maintained by the Book Running Lead Managers. Price Discovery and Allocation Our Company, in consultation with the Book Running Lead Managers, shall determine the Issue Price, which shall be at or above the Floor Price. The QIP Committee has on September 4, 2014 approved a discount of ₹ 0.6575 to the floor price in terms of Regulation 85 of SEBI Regulations After finalisation of the Issue Price, our Company shall update the Preliminary Placement Document with the Issue details and file the same with the Stock Exchanges as this Placement Document. Method of Allocation Our Company shall determine the Allocation in consultation with the Book Running Lead Managers on a discretionary basis and in compliance with Chapter VIII of the SEBI Regulations. Bids received from the QIBs at or above the Issue Price shall be grouped together to determine the total demand. The Allocation to all such QIBs will be made at the Issue Price. Allocation to Mutual Funds for up to a minimum of 10.00% of the Issue Size shall be undertaken subject to valid Bids being received at or above the Issue Price. THE DECISION OF OUR COMPANY IN CONSULTATION WITH THE BOOK RUNNING LEAD MANAGERS IN RESPECT OF ALLOCATION SHALL BE FINAL AND BINDING ON ALL QIBS. QIBS MAY NOTE THAT ALLOCATION OF EQUITY SHARES IS AT THE SOLE AND ABSOLUTE DISCRETION OF OUR COMPANY AND QIBS MAY NOT RECEIVE ANY ALLOCATION EVEN IF THEY HAVE SUBMITTED VALID APPLICATION FORMS AT OR ABOVE THE ISSUE PRICE. NEITHER OUR COMPANY NOR THE BOOK RUNNING LEAD MANAGERS IS OBLIGED TO ASSIGN ANY REASON FOR ANY NON-ALLOCATION. CAN Based on the Application Forms received, our Company, in consultation with the Book Running Lead Managers, in their sole and absolute discretion, decide the QIBs to whom the serially numbered CAN shall be sent, pursuant to which the details of the Equity Shares Allocated to them and the details of the amounts payable for Allotment of such Equity Shares in their respective names shall be notified to such QIBs. Additionally, a CAN will include details of the relevant Escrow Bank Account into which such payments would need to be made, address where the application money needs to be sent, Pay-In Date as well as the probable designated

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date, being the date of credit of the Equity Shares to the respective QIB’s account. The eligible QIBs would also be sent a serially numbered Placement Document either in electronic form or by physical delivery along with the serially numbered CAN. The dispatch of the serially numbered Placement Document and the serially numbered CAN to the QIBs shall be deemed a valid, binding and irrevocable contract for the QIB to furnish all details that may be required by the Book Running Lead Managers and to pay the entire Issue Price for all the Equity Shares Allocated to such QIB. QIBs are advised to instruct their Depository Participant to accept the Equity Shares that may be Allotted to them pursuant to the Issue. Bank Account for Payment of Application Money Our Company has opened the “Gammon Infra - QIP Escrow Account” with Yes Bank Limited in terms of the arrangement among our Company and the Book Running Lead Managers and Yes Bank Limited as escrow bank. The QIB will be required to deposit the entire amount payable for the Equity Shares Allocated to it by the Pay-In Date as mentioned in the respective CAN. If the payment is not made favouring the “Gammon Infra - QIP Escrow Account” within the time stipulated in the CAN, the Application Form and the CAN of the QIB are liable to be cancelled. Our Company undertakes to utilise the amount deposited in “Gammon Infra - QIP Escrow Account” only for the purposes of (i) adjustment against Allotment of Equity Shares in the Issue; or (ii) repayment of application money if our Company has not been able to Allot Equity Shares in the Issue. In case of cancellations or default by the QIBs, our Company and the Book Running Lead Managers have the right to reallocate the Equity Shares at the Issue Price among existing or new QIBs at their sole and absolute discretion. Payment Instructions The payment of application money shall be made by the QIBs in the name of “Gammon Infra - QIP Escrow Account” as per the payment instructions provided in the CAN. Payments are to be made only through electronic fund transfer. Designated Date and Allotment of Equity Shares The Equity Shares will not be Allotted unless the QIBs pay the Issue Price to the “Gammon Infra - QIP Escrow Account” as stated above. In accordance with the SEBI Regulations, Equity Shares will be issued and Allotment shall be made only in dematerialised form to the Allottees. Allottees will have the option to re-materialise the Equity Shares, if they so desire, as per the provisions of the Companies Act and the Depositories Act. Our Company, at its sole discretion, reserve the right to cancel the Issue at any time up to Allotment without assigning any reason whatsoever. Following the Allotment and credit of Equity Shares into the QIBs’ Depository Participant accounts, our Company will apply for final trading and listing approvals from the Stock Exchanges. QIBs who have been Allotted more than 5.00% of the Equity Shares in the Issue, our Company shall disclose the name and the number of the Equity Shares Allotted to such QIB to the Stock Exchanges and the Stock Exchanges will make the same available on their website. The Escrow Bank shall release the monies lying to the credit of the Escrow Bank Account to our Company post receipt of final listing and trading approvals from the Stock Exchanges.

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In the event that our Company is unable to issue and Allot the Equity Shares offered in the Issue or on cancellation of the Issue within 60 days from the date of receipt of application money, our Company shall repay the application money within 15 days from expiry of 60 days, failing which our Company shall repay that money with interest at the rate of 12% per annum from expiry of the sixtieth day. Other Instructions Right to Reject Applications Our Company, in consultation with the Book Running Lead Managers, may reject Bids, in part or in full, without assigning any reason whatsoever. The decision of our Company and the Book Running Lead Managers in relation to the rejection of Bids shall be final and binding. Equity Shares in Dematerialised form with NSDL or CDSL The Allotment of the Equity Shares in this Issue shall be only in dematerialised form (i.e., not in physical certificates but be fungible and be represented by the statement issued through the electronic mode). A QIB applying for Equity Shares to be issued pursuant to the Issue must have at least one beneficiary account with a Depository Participant of either NSDL or CDSL prior to making the Bid. Allotment to a successful QIB will be credited in electronic form directly to the beneficiary account (with the Depository Participant) of the QIB. Equity Shares in electronic form can be traded only on the stock exchanges having electronic connectivity with NSDL and CDSL. The Stock Exchanges have electronic connectivity with NSDL and CDSL. The trading of the Equity Shares to be issued pursuant to the Issue would be in dematerialised form only for all QIBs in the demat segment of the respective Stock Exchanges. Our Company will not be responsible or liable for the delay in the credit of Equity Shares to be issued pursuant to the Issue due to errors in the Application Form or otherwise on part of the QIBs.

Release of funds to our Company The Escrow Bank shall not release the monies lying to the credit of the Escrow Account till such time, that it receives an instruction in pursuance to the Escrow Agreement, along with the Listing and trading approval of the Stock Exchanges for the Equity Shares offered in the Placement.

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PLACEMENT Placement Agreement The Book Running Lead Managers have entered into a Placement Agreement with our Company, pursuant to which the Book Running Lead Managers have agreed to manage the Issue and to act as placement agents in connection with the proposed Issue and procure subscription for Equity Shares to be placed with the QIBs, pursuant to Chapter VIII of the SEBI Regulations.

The Placement Agreement contains customary representations and warranties, as well as indemnities from our Company and is subject to termination in accordance with the terms contained therein.

Applications shall be made to list the Equity Shares issued pursuant to the Issue and admit them to trading on the Stock Exchanges. No assurance can be given as to the liquidity or sustainability of the trading market for such Equity Shares, the ability of holders of the Equity Shares to sell their Equity Shares or the price at which holders of the Equity Shares will be able to sell their Equity Shares.

This Placement Document has not been, and will not be, registered as a prospectus with the RoC and, no Equity Shares issued pursuant to the Issue will be offered in India or overseas to the public or any members of the public in India or any other class of investors, other than QIBs.

In connection with the Issue, the Book Running Lead Managers (or their affiliates) may, for their own accounts, subscribe to the Equity Shares or enter into asset swaps, credit derivatives or other derivative transactions relating to the Equity Shares to be issued pursuant to the Issue at the same time as the offer and sale of the Equity Shares, or in secondary market transactions. As a result of such transactions, the Book Running Lead Managers may hold long or short positions in such Equity Shares. These transactions may comprise a substantial portion of the Issue and no specific disclosure will be made of such positions.

Affiliates of the Book Running Lead Managers may purchase the Equity Shares and be Allotted Equity Shares for proprietary purposes and not with a view to distribute or in connection with the issuance of P-Notes. See section “Notice to Investors – Off-shore Derivative Instruments” on page 7.

From time to time, the Book Running Lead Managers and their affiliates may engage in transactions with and perform services of our Company in the ordinary course of business and have engaged, or may in the future engage, in commercial banking and investment banking transactions with our Company or its affiliates, for which they have received compensation and may in the future receive compensation.

Lock-up

To provide comfort to the Investors that may participate in the Issue, the Promoter, during the period commencing on the date hereof and ending 60 days after the date of allotment of the Equity Shares under the Issue (the “Lock-up Period”), agrees not to, without the prior written permission of the Book Running Lead Managers, do the following:

(a) sell or transfer, any equity shares held by the Promoter or any securities convertible into or exercisable for any equity shares held by the Promoter or file any registration statement under the U.S. Securities Act of 1933, as amended, with respect to any of the foregoing (regardless of whether any of the transactions described in this clause (a) is to be settled by the delivery of the equity shares held by the Promoter or such other securities, in cash or otherwise); or

(b) sell or transfer, in whole or in part, directly or indirectly, any of the economic consequences associated with the ownership of any of the equity shares held by the Promoter or any securities convertible into or exercisable or exchangeable for any of the equity shares held by the Promoter; or

(c) deposit any of the equity shares held by the Promoter with any depositary in connection with a depositary receipt facility; or

Provided, however, that the foregoing restrictions shall not apply to any sale, transfer or disposition of any of the Promoter Shares by the undersigned with prior notice to the Book Running Lead Managers to the extent such sale, transfer or disposition is required by Indian law; and any bona fide pledge or non disposal undertaking of any of the Promoter Shares held by the undersigned as collateral for loans on normal commercial terms entered or to be entered into in the ordinary course of business of the undersigned, our Company and/or its Subsidiaries or transfer of any of the Promoter Shares to any third party pursuant to the invocation of any pledge in relation to the Promoter Shares.

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As used in the lock-up undertaking, the term “Promoter Shares” shall mean the 52,80,00,000 Equity Shares owned by GIL together with any and all Equity Shares that may be acquired by GIL during the Lock-up Period. Notwithstanding anything provided above, the foregoing restrictions on transfer of Promoter Shares by GIL shall not apply to any inter group transfer made to any entities forming a part of the Promoter Group, subject to compliance with applicable laws and subject to observance by the transferee Promoter Group of the foregoing restrictions on transfer of Promoter Shares until the expiry of the Lock-up Period.

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SELLING RESTRICTIONS

The distribution of this Placement Document or any offering material and the offering, sale or delivery of the Equity Shares is restricted by law in certain jurisdictions. Therefore, persons who may come into possession of this Placement Document or any offering material are advised to consult with their own legal advisors as to what restrictions may be applicable to them and to observe such restrictions. This Placement Document may not be used for the purpose of an offer or invitation in any circumstances in which such offer or invitation is not authorised.

General

No action has been taken or will be taken by the Company or the Book Running Lead Managers that would permit a public offering of the Equity Shares to occur in any jurisdiction, or the possession, circulation or distribution of this Placement Document or any other material relating to the Company or the Equity Shares in any jurisdiction where action for such purpose is required. Accordingly, the Equity Shares may not be offered or sold, directly or indirectly, and none of this Placement Document, any offering materials and any advertisements in connection with the offering of the Equity Shares may be distributed or published in or from any country or jurisdiction except under circumstances that will result in compliance with any applicable rules and regulations of any such country or jurisdiction. The Issue will be made in compliance with the applicable SEBI Regulations. Each purchaser of the Equity Shares in this Issue will be deemed to have made acknowledgments and agreements as described under “Notice to Investors”, “Representations by Investors” and “Transfer Restrictions”.

Australia

This Placement Document is not a disclosure document under Chapter 6D of the Corporations Act 2001 (Cth) (the “Australian Corporations Act”), and has not been lodged with the Australian Securities and Investments Commission and does not purport to include the information required of a disclosure document under the Australian Corporations Act. Accordingly, (i) the offer of the Equity Shares under this Placement Document is only made to “Sophisticated investors” within the meaning of Section 708(8) of the Australian Corporations Act or “Professional Investors” within the meaning of Section 708(11) of the Australian Corporations Act, who in each case are also “wholesale clients” for the purposes of Chapter 7 of the Australian Corporations Act; (ii) this Placement Document is made available in Australia only to persons as set forth in clause (i) above; and (iii) by accepting this offer, the offeree represents that the offeree is such a person as set forth in clause (i) above, and agrees not to sell or offer for sale within Australia any Equity Share sold to the offeree within 12 months after their issue or transfer to the offeree under this Placement Document.

The Company is not licensed to provide financial product advice in Australia in relation to the Equity Shares. This Placement Document is intended to provide general information only and has been prepared without taking into account any particular person’s objectives, financial situation or needs. Investors should, before acting on this information, consider the appropriateness of this information having regard to their personal objectives, financial situation or needs. No cooling off period applies in relation to this offer under the Australian Corporations Act.

Cayman Islands

This Placement Document does not constitute an invitation or offer to the public in the Cayman Islands of the Equity Shares, whether by way of sale or subscription. The Book Running Lead Managers not offered or sold, and will not offer or sell, directly or indirectly, any Equity Shares to the public in the Cayman Islands.

European Economic Area

In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, a “Relevant Member State”), with effect from and including the date on which the Prospectus Directive is or was implemented in that Relevant Member State (the “Relevant Implementation Date”), the Equity Shares may not be offered or sold to the public in that Relevant Member State prior to the publication of a prospectus in relation to the Equity Shares which has been approved by the competent authority in that Relevant Member State or, where appropriate, approved in another Relevant Member State and notified to the competent authority in that Relevant Member State, all in accordance with the Prospectus Directive and the 2010 Amending Directive, except that the Equity Shares, with effect from and including the Relevant Implementation Date, may be offered to the public in that Relevant Member State at any time:

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to legal entities which are authorised or regulated to operate in the financial markets or, if not so authorised or regulated, whose corporate purpose is solely to invest in securities;

to any legal entity which has two or more of: (1) an average of at least 250 employees during the last financial year; (2) a total balance sheet of more than €43,000,000; and (3) an annual net turnover of more than €50,000,000, in the case of (2) and (3) as shown in its last annual or consolidated accounts;

to fewer than 100 natural or legal persons (other than “qualified investors” as defined in the Prospectus Directive), subject to obtaining the prior consent of each Book Running Lead Manager; or

in any circumstances falling within Article 3(2) of the Prospectus Directive as amended (to the extent implemented in that Relevant Member State) by Article 1(3) of the 2010 Amending Directive,

provided that no such offering of Equity Shares shall result in a requirement for the publication by the Company or the Book Running Lead Managers of a prospectus pursuant to Article 3 of the Prospectus Directive as amended.

For the purposes of this provision, the expression an “offer of Equity Shares to the public” in relation to any Equity Shares in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the Equity Shares to be offered so as to enable an investor to decide to purchase or subscribe for the Equity Shares, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State, the expression “Prospectus Directive” means Directive 2003/71/EC and includes any relevant implementing measure in each Relevant Member State.

Hong Kong

No Equity Shares have been offered or sold, and no Equity Shares may be offered or sold, in Hong Kong, by means of any document, other than to “professional investors” as defined in the Securities and Futures Ordinance, Cap. 571 of the laws of Hong Kong (the “Securities and Futures Ordinance”) and any rules made under that Ordinance; or in other circumstances which do not result in the document being a “prospectus” as defined in the Companies Ordinance, Cap. 32 of the laws of Hong Kong (the “Companies Ordinance”); or which do not constitute an offer to the public within the meaning of the Companies Ordinance or an invitation to the public within the meaning of the Securities and Futures Ordinance. No document, invitation or advertisement relating to the Equity Shares has been issued or may be issued, which is directed at, or the contents of which are likely to be accessed or read by, the public of Hong Kong (except if permitted under the securities laws of Hong Kong) other than with respect to Equity Shares which are intended to be disposed of only to persons outside Hong Kong or only to “professional investors” as defined in the Securities and Futures Ordinance and any rules made under that Ordinance. This Placement Document and the Equity Shares have not been and will not be registered with the Securities and Futures Commission of Hong Kong and/or the Stock Exchange of Hong Kong. There are no public markets or platforms in Hong Kong for the purchase or disposal of the Equity Shares. If you are in doubt as to the contents of this Placement Document, you must immediately seek legal and investment advice from your solicitor, accountant and/or professional advisors.

Kuwait

The Issue has not been approved by the Kuwait Central Bank or the Kuwait Ministry of Commerce and Industry, nor has the Company received authorisation or licensing from the Kuwait Central Bank or the Kuwait Ministry of Commerce and Industry to market or sell the Equity Shares within Kuwait. Therefore, no services relating to the offering, including the receipt of applications and/or the allotment of Equity Shares, may be rendered within Kuwait by the Company or persons representing the Company.

Malaysia

No approval has been or will be obtained from the Securities Commission for the offering of the Equity Shares in Malaysia. The Equity Shares shall not be offered or sold to any person in Malaysia except to persons falling within Schedules 5, 6 and 7 of the Capital Markets and Services Act, 2007.

No prospectus has been or will be registered under the Capital Markets and Services Act, 2007 in respect of the Equity Shares and the Equity Shares shall not be issued, offered for subscription or be the subject matter of an invitation to subscribe, to any person in Malaysia except to persons falling within Schedules 5, 6 and 7 of the

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Capital Markets and Services Act, 2007.

Consequently, this Placement Document and any other offering document or material relating to the Equity Shares shall not be distributed or published and will not be distributed or published, and the Equity Shares shall not been offered, sold or made the subject matter of an invitation to subscribe or purchase and will not be offered, sold or made the subject matter of an invitation to subscribe or purchase, whether directly or indirectly, to any person in Malaysia except to persons falling within Schedules 5, 6 and 7 of the Capital Markets and Services Act, 2007.

Mauritius

Our Equity Shares may not be offered, distributed or sold, directly or indirectly, to the public in Mauritius. Neither this Placement Document, nor any offering material or information contained herein relating to the offer of Equity Shares, may be released or issued to the public in Mauritius or used in connection with any such offer. This Placement Document does not constitute an offer to sell Equity Shares to the public in Mauritius. This Placement Document is not a prospectus.

Qatar

This Placement Document does not, and is not intended to, constitute an invitation or an offer of securities in the State of Qatar (including the Qatar Financial Centre) and accordingly should not be construed as such. The Equity Shares have not been, and shall not be, offered, sold or delivered at any time, directly or indirectly, in the State of Qatar. Any offering of the Equity Shares shall not constitute a public offer of securities in the State of Qatar.

By receiving this document, the person or entity to whom it has been provided to understands, acknowledges and agrees that: (a) neither this Placement Document nor the Equity Shares have been registered, considered, authorised or approved by the Qatar Central Bank, the Qatar Financial Markets Authority, the Qatar Financial Centre Regulatory Authority or any other authority or agency in the State of Qatar; (b) neither the Company nor persons representing the Company are authorised or licensed by the Qatar Central Bank, the Qatar Financial Markets Authority, the Qatar Financial Centre Regulatory Authority, or any other authority or agency in the State of Qatar, to market or sell the Equity Shares within the State of Qatar; (c) this Placement Document may not be provided to any person other than the original recipient and is not for general circulation in the State of Qatar; and (d) no agreement relating to the sale of the Equity Shares shall be consummated within the State of Qatar.

No marketing of the Equity Shares has been or will be made from within the State of Qatar and no subscription to the Equity Shares may or will be consummated within the State of Qatar. Any applications to invest in the Equity Shares shall be received from outside of Qatar. This document shall not form the basis of, or be relied on in connection with, any contract in Qatar. Neither the Company nor persons representing the Company are, by distributing this document, advising individuals resident in the State of Qatar as to the appropriateness of investing in or purchasing or selling securities or other financial products. Nothing contained in this document is intended to constitute investment, legal, tax, accounting or other professional advice in, or in respect of, the State of Qatar.

Singapore

This Placement Document has not been and will not be registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this Placement Document and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the Equity Shares may not be issued, circulated or distributed, nor may the Equity Shares be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i) to an institutional investor pursuant to Section 274 of the Securities and Future Act (Chapter 289) of Singapore (the “SFA”), (ii) to a relevant person, or any person pursuant to Section 275(1A) of the SFA, and in accordance with the conditions specified in Section 275 of the SFA or (iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.

Unless otherwise permitted under the SFA, where the Equity Shares are acquired by a person pursuant to Section 274 or 275 of the SFA, such Equity Shares shall not be transferable for six months after that person has acquired the Equity Shares, except (i) to another person who is an institutional investor or a relevant person, or

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(ii) pursuant to Section 275(1A) of the SFA.

Unless otherwise permitted under the SFA, where the Equity Shares are subscribed or purchased pursuant to Section 275 of the SFA by a relevant person who is:

a corporation which is not an accredited investor (as defined in Section 4A of the SFA) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or

a trust (where the trustee is not an accredited investor) the sole purpose of which is to hold investments and each beneficiary of the trust is an individual who is an accredited investor,

shares, debentures and units of shares and debentures of that corporation or the beneficiaries’ rights and interest in that trust shall not be transferable for six months after that corporation or that trust has acquired the Equity Shares pursuant to an offer made under Section 275 of the SFA except: (i) to an institutional investor or to a relevant person defined in Section 275(2) of the SFA, or to any person pursuant to an offer that is made on the terms that such Equity Shares, debentures and units of Equity Shares and debentures of that corporation or such rights and interest in that trust are acquired at a consideration of not less than S$200,000 (or its equivalent in a foreign currency) for each transaction, whether such amount is to be paid for in cash or by exchange of securities or other assets, in accordance with the conditions, specified in Section 275 of the SFA as applicable; (ii) where no consideration is given for the transfer; or (iii) by operation of law.

United Arab Emirates (Excluding the Dubai International Financial Centre)

By receiving this Placement Document, the recipient person (or entity) understands, acknowledges and agrees that this Placement Document, the Issue, the Equity Shares and any interests therein have not been approved or licensed by have not been approved or licensed by or registered with the Central Bank of the United Arab Emirates, the Emirates Securities and Commodities Authority or any other relevant licensing authorities or governmental agencies in the U.A.E., and do not constitute a public offer of securities in the United Arab Emirates (“U.A.E.”) in accordance with the Federal Law No. 8 of 1986 concerning Commercial Companies (as amended), the Dubai International Financial Centre (“DIFC”) Markets Law 2004 or otherwise.

This Placement Document is not intended to constitute an offer, sale or delivery of shares or other securities under the laws of the U.A.E. The Equity Shares have not been and will not be registered under the Federal Law No. 4 of 2000 Concerning the Emirates Securities and Commodities Authority with the Emirates Security and Commodity Exchange or with the U.A.E. Central Bank, the Dubai Financial Market, the Abu Dhabi Securities Market, the NASDAQ Dubai or with any other U.A.E. exchange. Prospective investors in the DIFC should have regard to the specific notice to prospective investors in the DIFC set out below. No marketing of any financial products or services has been or will be made from within the U.A.E. and no subscription to any services, products or financial services may or will be consummated within the U.A.E. Nothing contained in this Placement Document is intended to constitute U.A.E. investment, legal, tax, accounting or other professional advice.

This Placement Document is for information only and nothing in this Placement Document is intended to endorse or recommend a particular course of action. Prospective investors should consult with an appropriate professional for specific advice rendered on the basis of their own situation.

This Placement Document is strictly private and confidential and is being distributed to a limited number of selected institutional and sophisticated investors, and must not be provided to any person other than the original recipient, and may not be reproduced or used for any other purpose. The interests in the Equity Shares may not be offered or sold directly or indirectly to the public in the U.A.E.

Notice to Prospective Investors in the Dubai International Financial Centre

This Placement Document relates to an exempt offer (an “Exempt Offer”) in accordance with the Offered Securities Rules of the Dubai Financial Services Authority (the “DFSA”). This Placement Document is intended for distribution only to persons of a type specified in those rules. It must not be delivered to, or relied on by, any other person. The DFSA has no responsibility for reviewing or verifying any documents in connection with Exempt Offers. The DFSA has not approved this Placement Document nor taken steps to verify the information set out in it, and has no responsibility for it. The Equity Shares to which this Placement

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Document relates may be illiquid and/or subject to restrictions on their resale. Prospective purchasers of the Equity Shares offered should conduct their own due diligence on the Equity Shares. If you do not understand the contents of this Placement Document, you should consult an authorised financial adviser. For the avoidance of doubt, the Equity Shares are not interests in a ‘‘fund’’ or a ‘‘collective investment scheme’’ within the meaning of either the Collective Investment Law (DIFC Law No. 2 of 2010) or the Collective Investment Rules Module of the Dubai Financial Services Authority Rulebook.

United Kingdom (in addition to the European Economic Area restrictions, above)

The Equity Shares cannot be promoted in the United Kingdom to the general public. The contents of this Placement Document have not been approved by an authorised person within the meaning of the Financial Services and Markets Act 2000, as amended (the “FSMA”). The Book Running Lead Managers (a) may only communicate or caused to be communicated and will only communicate or cause to be communicated an invitation or inducement to engage in investment activity (within the meaning of section 21 of the FSMA, to persons who (i) are investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the “Financial Promotion Order”), or (ii) fall within any of the categories of persons described in article 49(2)(a) to (d) of the Financial Promotion Order or otherwise in circumstances in which section 21(1) of the FSMA does not apply to the Company; and (b) has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the Equity Shares in, from or otherwise involving the United Kingdom. Any invitation or inducement to engage in investment activity (within the meaning of Section 21 of FSMA) in connection with, or relating to, the sale or purchase of any Equity Shares, may only be communicated or caused to be communicated in circumstances in which Section 21(1) of the FSMA does not apply. It is the responsibility of all persons under whose control or into whose possession this document comes to inform themselves about and to ensure observance of all applicable provisions of FSMA in respect of anything done in relation to an investment in Equity Shares in, from or otherwise involving, the United Kingdom.

United States

Please refer to the section entitled “Notice to Investors” on page 1 of this Placement Document.

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TRANSFER RESTRICTIONS Allottees are not permitted to sell the Equity Shares for a period of one year from the date of Allotment except through the Stock Exchanges. In addition to the above, allotments made to QIBs, including FVCIs, VCFs and AIFs in the Issue, may be subject to lock-in requirements, if any, under the rules and regulations that are applicable to them. Accordingly, purchasers are advised to consult their own legal counsel prior to making any offer, re-sale, pledge or transfer of the Equity Shares.

General

Each purchaser of the Equity Shares, by accepting delivery of this Placement Document, will be deemed to have represented, agreed and acknowledged that:

it is authorised to consummate the purchase of the Equity Shares in compliance with all applicable laws and regulations;

it acknowledges and agrees (or if it is a broker-dealer acting as an agent on behalf of a customer, its customer has confirmed to it that such customer acknowledges and agrees) that such Equity Shares have not been and will not be registered under the Securities Act or any state securities laws in the United States;

it certifies that either (A) it is, or at the time the Equity Shares are purchased will be, the beneficial owner of the Equity Shares and is located outside the United States (within the meaning of Regulation S) or (B) it is a broker-dealer acting as an agent on behalf of its customer and its customer has confirmed to it that (i) such customer is, or at the time the Equity Shares are purchased will be, the beneficial owner of the Equity Shares, and (ii) such customer is located outside the United States (within the meaning of Regulation S);

it agrees that it will not offer, sell, pledge or otherwise transfer such Equity Shares except in an off-shore transaction complying with Rule 903 or Rule 904 of Regulation S or pursuant to any other available exemption from the registration requirements of the Securities Act and in accordance with all applicable securities laws of the states of the United States and any other jurisdiction, including India;

it is relying on this document and not on any other information or the representation concerning the Company or the Equity Shares and neither the Company nor any other person responsible for this Placement Document or any part of it nor the Book Running Lead Managers will have any liability for any such other information or representation; and

the Company, the Book Running Lead Managers and their respective affiliates and others will rely upon the truth and accuracy of the foregoing acknowledgements, representations and agreements, and it agrees that, if any of such acknowledgements, representations and agreements deemed to have been made by virtue of its purchase of the Equity Shares are no longer accurate, it will promptly notify us. Any resale or other transfer, or attempted resale or other transfer, made other than in compliance with the above-stated restrictions will not be recognised by us.

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THE SECURITIES MARKET OF INDIA The information in this section has been extracted from documents available on the website of SEBI and the Stock Exchanges and has not been prepared or independently verified by our Company or the Book Running Lead Managers or any of their respective affiliates or advisors. India has a long history of organized securities trading. In 1875, the first stock exchange was established in Mumbai. Indian Stock Exchanges Indian stock exchanges are regulated primarily by SEBI, as well as by the Government acting through the Ministry of Finance, Capital Markets Division, under the Securities Contracts (Regulation) Act, 1956 (the “SCRA”) and the Securities Contracts (Regulation) Rules, 1957 (the “SCRR”). On June 20, 2012, SEBI, in exercise of its powers under the SCRA and the Securities and Exchange Board of India Act, 1992, as amended from time to time (the “SEBI Act”), notified the Securities Contracts (Regulation) (Stock Exchanges and Clearing Corporations) Regulations, 2012 (the “SCR (SECC) Rules”), which regulate inter alia the recognition, ownership and internal governance of stock exchanges and clearing corporations in India together with providing for minimum capitalisation requirements for stock exchanges. The SCRA, the SCRR and the SCR (SECC) Rules along with various rules, bye-laws and regulations of the respective stock exchanges, regulate the recognition of stock exchanges, the qualifications for membership thereof and the manner, in which contracts are entered into, settled and enforced between members of the stock exchanges. The SEBI Act empowers SEBI to regulate the Indian securities markets, including stock exchanges and intermediaries in the capital markets, promote and monitor self-regulatory organisations and prohibit fraudulent and unfair trade practices. Regulations and guidelines concerning minimum disclosure requirements by public companies, investor protection, insider trading, substantial acquisitions of shares and takeover of companies, buy-backs of securities, employee stock option schemes, stockbrokers, merchant bankers, underwriters, Mutual Funds, FIIs, FPIs, credit rating agencies and other capital market participants have been notified by the relevant regulatory authority. Presently, there are 17 recognized stock exchanges in India. Most of the stock exchanges have their own governing board for self regulation. The BSE and the NSE together hold a dominant position among the stock exchanges in terms of the number of listed companies, market capitalization and trading activity. Listing The listing of securities on a recognised Indian stock exchange is regulated by the applicable Indian laws including the Companies Act, the SCRA, the SCRR, the SEBI Act and various guidelines and regulations issued by SEBI and the listing agreements of the respective stock exchanges. The SCRA empowers the governing body of each recognised stock exchange to suspend trading of or withdraw admission to dealings in a listed security for breach of or non compliance with any conditions or breach of company’s obligations under such listing agreement or for any reason, subject to the issuer receiving prior written notice of the intent of the exchange and upon granting of a hearing in the matter. SEBI also has the power to amend such equity listing agreements and bye-laws of the stock exchanges in India, to overrule a stock exchange’s governing body and withdraw recognition of a recognized stock exchange. Pursuant to an amendment of the SCRR in June 2010, all listed companies are required to ensure a minimum public shareholding at 25%. Listed companies which had public shareholding below 25% prior to the amendment in June, 2010, were required to increase the public shareholding to the level of at least 25% within a period of three years from the date of commencement of the amendment. Further, where the public shareholding in a listed company falls below 25% at any time, such company is required to bring the public shareholding to 25% within a maximum period of 12 months from the date of such fall. Consequently, a listed company may be delisted from the stock exchanges for not complying with the above-mentioned requirement. Our Company is in compliance with this minimum public shareholding requirement. Delisting SEBI has notified the Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009 in relation to the voluntary and compulsory delisting of equity shares from the stock exchanges. In addition, certain

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amendments to the SCRR have also been notified in relation to delisting. Index-Based Market-Wide Circuit Breaker System In order to restrict abnormal price volatility in any particular stock, SEBI has instructed stock exchanges to apply daily circuit breakers which do not allow transactions beyond a certain level of price volatility. The index-based market-wide circuit breaker system (equity and equity derivatives) applies at three stages of the index movement, at 10%, 15% and 20%. These circuit breakers, when triggered, bring about a co-ordinated trading halt in all equity and equity derivative markets nationwide. The market-wide circuit breakers are triggered by movement of either the SENSEX of the BSE or the S&P CNX NIFTY of the NSE, whichever is breached earlier. In addition to the market-wide index-based circuit breakers, there are currently in place individual scrip-wise price bands of 20% movements either up or down. However, no price bands are applicable on scrips on which derivative products are available or scrips included in indices on which derivative products are available. The stock exchanges in India can also exercise the power to suspend trading during periods of market volatility. Margin requirements are imposed by stock exchanges that are required to be paid by the stockbrokers. BSE Established in 1875, it is the oldest stock exchange in India. In 1956, it became the first stock exchange in India to obtain permanent recognition from the Government under the SCRA. It has evolved over the years into its present status as one of the premier stock exchanges of India. NSE The NSE was established by financial institutions and banks to provide nationwide online, satellite-linked, screen-based trading facilities with market-makers and electronic clearing and settlement for securities including government securities, debentures, public sector bonds and units. It has evolved over the years into its present status as one of the premier stock exchanges of India. The NSE was recognised as a stock exchange under the SCRA in April 1993 and commenced operations in the wholesale debt market segment in June 1994. The capital market (equities) segment commenced operations in November 1994 and operations in the derivatives segment commenced in June 2000. NSE launched the NSE 50 Index, now known as S&P CNX NIFTY, on April 22, 1996 and the Mid-cap Index on January 1, 1996. The securities in the NSE 50 Index are highly liquid. Internet-based Securities Trading and Services Internet trading takes place through order routing systems, which route client orders to exchange trading systems for execution. Stockbrokers interested in providing this service are required to apply for permission to the relevant stock exchange and also have to comply with certain minimum conditions stipulated under applicable law. The NSE became the first exchange to grant approval to its members for providing internet-based trading services. Internet trading is possible on both the “equities” as well as the “derivatives” segments of the NSE. Trading Hours Trading on both the NSE and the BSE occurs from Monday to Friday, between 9:15 a.m. and 3:30 p.m. IST (excluding the 15 minutes pre-open session from 9:00 a.m. to 9:15 a.m. that has been introduced recently). The BSE and the NSE are closed on public holidays. The recognised stock exchanges have been permitted to set their own trading hours (in the cash and derivatives segments) subject to the condition that (i) the trading hours are between 9.00 a.m. and 5.00 p.m.; and (ii) the stock exchange has in place a risk management system and infrastructure commensurate to the trading hours. Trading Procedure In order to facilitate smooth transactions, the BSE replaced its open outcry system with BSE On-line Trading (or “BOLT”) facility in 1995. This totally automated screen based trading in securities was put into practice nation-wide. This has enhanced transparency in dealings and has assisted considerably in smoothening settlement cycles and improving efficiency in back-office work.

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NSE has introduced a fully automated trading system called National Exchange for Automated Trading (or “NEAT”), which operates on strict time/price priority besides enabling efficient trade. NEAT has provided depth in the market by enabling large number of members all over India to trade simultaneously, narrowing the spreads. Takeover Regulations Disclosure and mandatory bid obligations for listed Indian companies under Indian law are governed by the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, as amended (the “Takeover Regulations”), which provides specific regulations in relation to substantial acquisition of shares and takeover. Once the equity shares of a company are listed on a stock exchange in India, the provisions of the Takeover Regulations will apply to any acquisition of the company’s shares/voting rights/control. The Takeover Regulations prescribes certain thresholds or trigger points in the shareholding a person or entity has in the listed Indian company, which give rise to certain obligations on part of the acquirer. Acquisitions up to a certain threshold prescribed under the Takeover Regulations mandate specific disclosure requirements, while acquisitions crossing particular thresholds may result in the acquirer having to make an open offer of the shares of the target company. The Takeover Regulations also provides for the possibility of indirect acquisitions, imposing specific obligations on the acquirer in case of such indirect acquisition. Insider Trading Regulations The Insider Trading Regulations have been notified by SEBI to prohibit and penalize insider trading in India. An insider is, among other things, prohibited from dealing either on his own behalf or on behalf of any other person, in the securities of a listed company when in possession of unpublished price sensitive information. The Insider Trading Regulations also provide disclosure obligations for shareholders holding more than a pre-defined percentage, and directors and officers, with respect to their shareholding in the company, and the changes therein. The definition of “insider” includes any person who has received or has had access to unpublished price sensitive information in relation to securities of a company or any person reasonably expected to have access to unpublished price sensitive information in relation to securities of a company and who is or was connected with the company or is deemed to have been connected with the company. Depositories The Depositories Act provides a legal framework for the establishment of depositories to record ownership details and effect transfers in book-entry form. Further, SEBI framed regulations in relation to, among other things, the formation and registration of such depositories, the registration of participants as well as the rights and obligations of the depositories, participants, companies and beneficial owners. The depository system has significantly improved the operation of the Indian securities markets. Derivatives (Futures and Options) Trading in derivatives is governed by the SCRA, the SCRR and the SEBI Act. The SCRA was amended in February 2000 and derivatives contracts were included within the term “securities”, as defined by the SCRA. Trading in derivatives in India takes place either on separate and independent derivatives exchanges or on a separate segment of an existing stock exchange. The derivatives exchange or derivatives segment of a stock exchange functions as a self-regulatory organisation under the supervision of the SEBI.

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DESCRIPTION OF EQUITY SHARES The following is information relating to the Equity Shares including a brief summary of the Memorandum and Articles of Association, the Companies Act, 1956 and the notified sections of the Companies Act, 2013, which are in force and applicable to us. Prospective investors are urged to read the Memorandum and Articles of Association carefully, and consult with their advisers, as the Memorandum and Articles of Association and applicable Indian law, and not this summary, govern the rights attached to the Equity Shares. Authorized Capital The authorized share capital of our Company is ₹ 2,00,00,00,000 divided into 1,000,000,000 Equity Shares of ₹ 2 each. As of June 30, 2014, the paid-up capital totaled to ₹1,46,80,52,876 consisting of 73,40,26,438 fully paid up Equity Shares of ₹ 2 each.

Dividends

Under Indian law, a company pays dividends upon a recommendation by its board of directors and approval by a majority of the shareholders at the AGM of shareholders held each financial year. Under the Companies Act, unless the board of directors of a company recommends the payment of a dividend, the shareholders at a general meeting have no power to declare any dividend. Subject to certain conditions specified under the Companies Act and the rules made thereunder no dividend can be declared or paid by a company for any financial year except (a) out of the profits of the company for that year, calculated in accordance with the provisions of the Companies Act; or (b) out of the profits of the company for any previous financial year(s) arrived at in accordance with the Companies Act and remaining undistributed; or (c) out of both; or (d) out of money provided by the Central Government or a state Government for payment of dividend by the Company in pursuance of a guarantee given by that Government. Dividend may only be paid out of the Company‘s profits for the relevant year and, in certain contingencies, out of the reserves of the Company in accordance with the rules made by the Central Government. Any dividend that remains unpaid or unclaimed after 30 days from the date of the declaration of dividend has to be transferred to a special unpaid dividend bank account held with an approved scheduled bank within seven days of the expiry of 30 days from the date of the declaration of such dividend. No unclaimed dividend shall be forfeited by the board of directors till the claim thereto becomes barred by the law and the company shall comply with all the provisions of the Companies Act. Dividend under the Companies Act includes interim dividend. This amount of dividend shall be deposited in a separate bank account within five days from the date of declaration of dividend and when declared, shall have to be paid to shareholders within 30 days of the declaration.

Capitalisation of Reserves and Issue of Bonus Shares

In addition to permitting dividends to be paid out of current or retained earnings as described above, the Companies Act permits the board of directors, if so approved by the shareholders in a general meeting, to capitalise its profits or reserves for the purpose of issuing fully paid-up bonus shares, which are similar to stock dividend. The Companies Act permits the issue of fully paid up bonus shares from its free reserves, securities premium account or capital redemption reserve account, provided that bonus shares shall not be issued by capitalising reserves created by revaluation of assets. These bonus Equity Shares must be distributed to shareholders in proportion to the number of Equity Shares owned by them as recommended by the board of directors.

Any issue of bonus shares by a listed company would be subject to the SEBI Regulations. The relevant SEBI Regulations prescribe that no company shall make a bonus issue of equity shares if it has outstanding fully or partly convertible debt instruments at the time of making the bonus issue, unless it has made reservation of the equity shares in the same class in favour of the holders of the outstanding convertible debt instruments in proportion to the convertible part thereof and the equity shares reserved for the holders of fully or partly convertible debt instruments shall be issued at the time of conversion of such convertible debt instruments on the same terms or same proportion on which the bonds were issued. Further, for issuance of such bonus shares, a company should not have defaulted in the payment of interest or principal in respect of fixed deposits and interest on existing debentures or principal on redemption of such debentures. The declaration of bonus shares in

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lieu of a dividend cannot be made. The bonus issuance shall be made out of free reserves built out of genuine profits or share premium collected in cash only. The reserves created by revaluation of fixed assets cannot be capitalised. Further, a company should have sufficient reason to believe that it has not defaulted in respect of the payment of statutory dues of the employees, such as contributions to provident funds, gratuities and/or bonuses.

Alteration of Share Capital The Companies Act gives shareholders the right to subscribe for new shares in proportion to their existing shareholdings unless otherwise determined by a resolution passed by three-fourths of the shareholders present and voting at a general meeting. Under the Companies Act, in the event of an issuance of securities, subject to the limitations set forth above, a company must first offer the new equity shares to the holders of equity shares on a fixed record date. The offer, required to be made by notice, must include: the right, exercisable by the shareholders as on record, to renounce the equity shares offered in favor of any

other person; the number of equity shares offered; and the period of the offer, which may not be less than 15 days from the date of the offer. If the offer is not

accepted, it is deemed to have been declined. Under the provisions of the Companies Act new shares may be offered to any persons whether or not those persons include existing shareholders, if a special resolution to that effect is passed by the shareholders of a company in a general meeting.

General Meetings of Shareholders There are two types of general meetings of shareholders: Annual General Meetings and Extraordinary General Meetings. A company is required to convene its AGM within 15 months of the previous AGM and in any event not later than six months after the end of each financial year. The Company may convene an EGM when necessary or at the request of a shareholder or shareholders holding at least 10% of the company‘s paid-up capital on the date of the request. A general meeting may be convened by the company secretary in accordance with a resolution passed at the meeting of the Board of Directors. A general meeting may be convened by the company by giving not less than 21 days’ notice in writing. Every notice shall specify the place, day and hour of the meeting and a statement of business to be transacted there at. A general meeting may be called by giving shorter notice if consent is received from shareholders holding not less than 95% of the company‘s paid-up capital. The AGM is required to be held in Mumbai, the city in which the Company‘s registered office is located. General meetings other than the AGM may be held at any location if so determined by a resolution of the Board of Directors. Voting Rights A shareholder has one vote for each equity share and voting may be by way of voting by electronic means or show of hands or on a poll. The chairman of the meeting has a casting vote. Resolutions are adopted at a general meeting by a majority of the shareholders having voting rights present or represented. As on June 30, 2014, the quorum for a general meeting is 30 members personally present for our Company. Generally, resolutions may be passed by simple majority of the shareholders present and voting at any general meeting. However, special resolutions such as an amendment to the constitutional documents, commencement of a new line of the Company‘s business, an issue of additional Equity Shares without preemptive rights and reductions of share capital require that the votes cast in favor of the resolution (whether by show of hands or on a poll) are not less than three times the number of votes, if any, cast against the resolution. As provided in the Company‘s Articles, a shareholder may exercise his/her voting rights by appointing a person as proxy through the use of appropriate forms. This proxy, however, is required to be lodged with the Company at least 48 hours before the time of the relevant meeting. A shareholder may, by a single power of attorney, grant general power of representation covering several general meetings. A proxy may not vote except on a poll and does not have a right to speak at meetings. A corporate shareholder is also entitled to nominate a representative to attend and vote on its behalf at all general meetings. The Companies Act has been amended to provide for passing of resolutions in relation to specified matters, which have been defined by the Government, by means of a postal ballot. A company intending to pass a

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resolution relating to matters including, but not limited to, amendment to the objects clause of its Memorandum of Association, buy-back of shares under the Companies Act, giving loans or extending guarantees in excess of limits prescribed under the Companies Act, and regulations issued thereunder is required to obtain the resolution by means of a postal ballot instead of transacting the business in the general meeting of the company. A notice to all the shareholders shall be sent along with a draft resolution explaining the reasons thereof and requesting them to send their assent or dissent in writing on a postal ballot within a period of 30 days from the date of posting the letter. If the resolution is assented to by a requisite majority by means of postal ballot, it shall be deemed to have been only duly passed at the general meeting convened in that behalf. Directors

The Articles of Association provide that the number of Directors shall not be less than three and not be more than twelve. The Directors shall be appointed by our Company in the general meeting subject to the provisions of the Companies Act and the Articles of Association. The Directors to retire by rotation at every annual general meeting shall be those who have been longest in office since their last appointment but as between persons who became Directors on the same day those to retire shall in default of being subject to any agreement among themselves, be determined by lot.

The Directors have the power to appoint any other persons as an addition to our Board but any Director so appointed shall hold office only up to the date of the next following annual general meeting of our Company and the total number of Directors shall not at any time exceed the maximum strength prescribed under the Articles of Association. Our Board shall also have the power to appoint any person to act as an alternate Director for a Director during the latter's absence for a period of not less than three months from India.

Our Board is required to meet at least once in every three calendar months for the dispatch of business, adjourn and otherwise regulate its meetings and proceedings as it thinks fit provided that at least four such meetings shall be held in every year. The quorum for a meeting of our Board is one-third of its total strength (any fraction contained in that one-third being rounded off as one) or two Directors, whichever is higher. However, where it involves a decision on an affirmative vote item, the quorum is required to include an investor Director. Transfer of Shares An application for registration of a transfer of the Shares in our Company may be made either by the transferor or the transferee.

Our Company is required to comply with the rules, regulations and requirements of the stock exchange or the rules made under the Companies Act, or the rules made under the Securities Contracts (Regulation) Act, 1956, as amended ("SCRA"), or any other law or rules applicable, relating to the transfer or transmission of Shares or debentures. Acquisition by the Company of its own Shares Our Company may buy back its own Shares or other specified securities subject to the provisions of the Companies Act and any related guidelines issued in connection therewith.

Liquidation Rights Subject to the rights of depositors, creditors, employees, the Government or any State government in the event of the Company‘s winding up, the holders of the Equity Shares are entitled to be repaid the amount of capital paid-up or credited as paid-up on these Equity Shares. All surplus assets remaining, after the above payments are made, belong to the holders of the Equity Shares in proportion to the amount paid-up or credited as paid-up on these Equity Shares, respectively, at the commencement of the winding-up.

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STATEMENT OF TAX BENEFITS

STATEMENT OF POSSIBLE TAX BENEFITS AVAILABLE TO THE COMPANY AND ITS SHAREHOLDERS

To The Board of Directors Gammon Infrastructure Projects Limited, Gammon House, Veer Savarkar Marg, Prabhadevi, Mumbai 400 025 Dear Sirs, We hereby confirm that the enclosed Annexure, prepared by Gammon Infrastructure Projects Limited (the “Company”), states the possible tax benefits available to the Company and the shareholders of the Company under the Income-tax Act, 1961 (“IT Act”), the Wealth Tax Act, 1957, presently in force in India. Several of these benefits are dependent on the Company or its shareholders fulfilling the conditions prescribed under the relevant provisions of the IT Act. Hence, the ability of the Company or its shareholders to derive the tax benefits is dependent upon fulfilling such conditions, which based on the business imperatives, the Company or its shareholders may or may not choose to fulfill. The benefits discussed in the Annexure are not exhaustive and the preparation of the contents stated is the responsibility of the Company’s management. We are informed that this statement is only intended to provide general information to the investors and hence is neither designed nor intended to be a substitute for professional tax advice. In view of the individual nature of the tax consequences, the changing tax laws, each investor is advised to consult his or her own tax consultant with respect to the specific tax implications arising out of their participation in the issue. Our confirmation is based on the information, explanations and representations obtained from the Company and on the basis of our understanding of the business activities and operations of the Company (including its relevant subsidiaries) and the interpretation of the current tax laws in force in India. We do not express any opinion or provide any assurance as to whether: the Company or its shareholders will continue to obtain these benefits in future; or .the conditions prescribed for availing the benefits, where applicable have been/ would be met. The revenue authorities/courts will concur with the views expressed herein For Natvarlal Vepari & Co. Firm Registration Number: 106971W

For S.R. Batliboi & Co. LLP Firm Registration Number: 301003E

Chartered Accountants Chartered Accountants

N Jayendran per Hemal Shah Partner Partner M.No. 40441 M.No. 42650 Mumbai Mumbai Date: August 27, 2014 Date: August 27, 2014

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ANNEXURE TO STATEMENT OF POSSIBLE TAX BENEFITS AVAILABLE TO GAMMON INFRASTRUCTURE PROJECTS LIMITED AND ITS SHAREHOLDERS

(A) Benefits to the Company under the Income Tax Act, 1961 (“IT Act”) 1. Special Tax Benefits under Section 80IA

The following specific tax benefits are available to the Company (including its relevant subsidiaries) after fulfilling conditions as per the respective provisions of the relevant tax laws

In accordance with and subject to the conditions specified in Section 80-IA of the IT Act, the company and certain subsidiaries of the Company may be entitled for a deduction of an amount equal to hundred percent of profits or gains derived from any enterprise carrying on business of (i) developing or (ii) operating and maintaining or (iii) developing, operating and maintaining any infrastructure facility (iv) generating or (v) generating or distributing of power for any ten consecutive assessment years out of fifteen years beginning from the year in which the enterprise has started its operation. At present, no benefit under this section is allowed with respect to any undertaking which begins to generate or generation and distribute power at any time after 31st day of March 2017 unless the same is further extended to any future date The benefit is available subject to fulfilment of prescribed conditions. For the words “fifteen years”, the words “twenty years” has been substituted for the following infrastructure facility- (a) A road including toll road, a bridge or a rail system: (b) A highway project including housing or other activities being an integral part of the highway

project: (c) A water supply project, water treatment system, irrigation project, sanitation and sewerage system

or solid waste management system. However, the aforesaid deduction is not available while computing Minimum Alternative Tax (‘MAT’) liability of the relevant subsidiaries of the Company under Section 115JB of the IT Act. Nonetheless, such MAT paid/ payable on the adjusted book profits of the relevant subsidiaries of the Company computed in terms of the provisions of IT Act, read with the Companies Act, 1956 would be eligible for credit against tax liability arising under normal provisions of IT Act as per Section 115JAA of the IT Act to the extent of the difference between the tax as per normal provisions of the IT Act and MAT in the year of set-off Further, such credit would not be allowed to be carried forward and set off beyond 10th assessment year immediately succeeding the assessment year in which such credit becomes allowable.

2. Depreciation

Subject to compliance with certain conditions laid down in Section 32 of the IT Act, the Company will be entitled to deduction for depreciation:

a. In respect of tangible assets (being buildings, machinery, plant or furniture) and intangible assets

(being know-how, patents, copyrights, trademarks, licenses, franchises or any other business or commercial rights of similar nature acquired on or after 1st day of April, 1998) at the rates prescribed under the Income-tax Rules, 1962;

b. The Company is further entitled to additional depreciation at the rate of 20 % of the actual cost of any new plant and machinery (other than ships and aircraft) acquired on or after 31st day of March 2005 in the year of purchase of such plant or machinery.

c. The IT Act read with Rule 5 of Income Tax Rules, 1962 (‘IT Rules’) for the purpose of plant and

machinery relating to generation of power provides an option of claiming the depreciation on actual cost(i.e. Straight Line Method) as per rate specified in Appendix IA of IT Rules.

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d. Business losses, if any, for an assessment year can be carried forward and set off against business profits for eight subsequent years in terms of the provisions of Section 72 of the IT Act.

e. As per section 32(2) of the IT Act, unabsorbed depreciation if any, for an Assessment Year (AY) can be carried forward and set off against any source of income in subsequent AYs, subject to the provisions of sub-section (2) of section 72 and sub-section (3) of section 73 of the IT Act.

f. In respect of development of road / highways on Build-Operate-Transfer (‘BOT’) basis where the

ownership is not vested with developer but where the developer gets a right to collect toll, the Central Board of Direct Taxes (CBDT), under powers conferred to it u/s 119 of the Act, vide circular no. 09/2014 dated April 23, 2014, has clarified that the cost of construction on development of infrastructure facility of roads/ highways under BOT projects is allowable as a deduction by amortizing and claiming the same as allowable business expenditure under the Act. The Amortization allowable may be computed at the rate, which ensures that the whole of the cost incurred in creation of infrastructural facility of Road/ Highway is amortized evenly over the period of concessionaire agreement after excluding the time taken for creation of such facility.

3. Dividends exempt under sections 10(34) and 10(35) of the IT Act.

Dividend (whether interim or final) received by the Company from its investment in shares of another domestic company would be exempted in the hands of the Company as per the provisions of section 10(34) read with section 115-O of the IT Act. The domestic company distributing dividends will be liable to pay dividend distribution tax at the rate of 15% on net basis on the amount of dividend payable till September 30, 2014 (plus a surcharge of 10% on the dividend distribution tax and education cess and secondary and higher education cess of 2% and 1% respectively on the amount of dividend distribution tax and surcharge thereon). Further w.e.f October 1, 2014, Finance Act 2014, has amended section 115-O in order to provide that for the purpose of determining the tax on distributed profits payable in accordance with the section 115-O, any amount by way of dividends referred to in sub-section (1) of the said section, as reduced by the amount referred to in sub-section (1A) [referred to as net distributed profits], shall be increased to such amount as would, after reduction of the tax on such increased amount at the rate specified in sub-section (1), be equal to the net distributed profits. Thus, where the amount of dividend paid or distributed by a company is ₹ 85, then DDT under the amended provision would be calculated as follows: Dividend amount distributed = Rs 85 Increase by Rs 15 [i.e. (85*0.15)/(1-0.15)] Increased amount = Rs 100 DDT @ 15% of Rs 100 = Rs 15 Tax payable u/s 115-O is Rs 15 Dividend distributed to shareholders = Rs 85 So DDT payable will be Rs 15 before surcharge and education cess and higher education cess Further it may be noted that the surcharge and education cess and secondary and higher education cess applicable remains unchanged. However, as per section 94(7) of the Act, losses arising from sale/transfer of shares, where such shares are purchased within three months prior to the record date and sold within three months from the record date, will be disallowed to the extent such loss does not exceed the amount of dividend claimed exempt.

In terms of section 10(35) of the IT Act, any income received from units of a Mutual Fund specified under section 10(23D) of the IT Act is exempt from tax, subject to such income not arising from the transfer of units in such Mutual Fund. Section 14A of the IT Act read with Rule 8D restricts claim for deduction of expenses incurred in relation to income which does not form part of the total income under the IT Act. Thus, any

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expenditure incurred to earn the said tax free income will not be tax deductible expenditure. Further, the Central Board of Direct Taxes has prescribed methodology for disallowance under Rule 8D of the Income-tax Rules, 1962. The prescribed methodology becomes applicable where the Indian Revenue authorities are not satisfied with the correctness of the taxpayer`s claim having regard to its accounts. Further, if the company being a holding company, has received any dividend from its subsidiary on which dividend distribution tax has been paid by such subsidiary, then for the same year, the company will not be required to pay dividend distribution tax to the extent for such dividend has been paid by such subsidiary company. For removing the cascading effect of dividend distribution tax, while computing the amount of dividend distribution tax payable by a domestic company, the dividend received from a foreign subsidiary on which income-tax has been paid by the domestic company under Section 115BBD of the Act shall be reduced.

4. Computation of capital gains

Capital assets are to be categorized into short-term capital assets and long-term capital assets based on the period of holding. All capital assets [except a security (other than a unit) listed in a recognized stock exchange of India or units of Unit Trust of India (‘UTI’) or a unit of an equity oriented fund and zero coupon bonds] are considered to be long-term capital assets, if they are held for a period exceeding thirty-six months. Security (other than a unit) listed in a recognized stock exchange of India or units of Unit Trust of India (‘UTI’) or a unit of an equity oriented fund and zero coupon bonds are considered as long-term capital assets, if these are held for a period exceeding twelve months. The Finance (No.2) Act 2014 has however inserted second proviso to section 2(42A) w.e.f 1.4.2015 which provides that in the case of capital assets representing shares held in a company not being shares listed on a recognized stock exchange or units of Mutual Fund specified under clause (23D) of Section 10 which is transferred between 1st April 2014 and 10th July 2014 are treated as short term capital assets if they are not held for more than twelve months. As per the provisions of section 10(38) of the IT Act, long term capital gain arising to the Company from transfer of a long term capital asset being an equity share in a company listed on a recognized stock exchange in India or unit of equity oriented mutual fund shall be exempt from tax, if the transaction is chargeable to Securities Transaction Tax (‘STT’). However, such long-term capital gains will be included while computing book profits for the purpose of payment of Minimum Alternate Tax (“MAT”) under the provisions of section 115JB of the IT Act. As per provisions of Section 48 of the Act, LTCG arising on transfer of capital assets, other than bonds and debentures (excluding capital indexed bonds issued by the Government) and depreciable assets, is computed by deducting the indexed cost of acquisition and indexed cost of improvement from the net value of consideration (i.e. Full value of consideration minus expenses incurred wholly and exclusively in connection with such transfer). As per the provisions of section 112 of the IT Act, long-term capital gains (other than those covered under section 10(38) of the IT Act) are subject to tax at a rate of 20%. However, proviso to section 112(1) specifies that if the long-term capital gains (other than those covered under section 10(38) of the IT Act) arising on transfer of listed securities (other than a unit) or zero coupon bond, calculated at the rate of 20% with indexation benefit exceeds the capital gains computed at the rate of 10% without indexation benefit, then such capital gains are chargeable to tax at the rate of 10% without indexation benefit. Second proviso to S 112(1) specifies that in respect of long term arising on account of transfer of unit of a mutual fund specified under S10(23D) between 1st April 2014 and 10th July 2014 exceeds the capital gains computed at the rate of 10% without indexation benefit, then such capital gains are chargeable to tax at the rate of 10% without indexation benefit. As per provisions of section 111A of the IT Act, short term capital gains arising from transfer of short term capital asset, being an equity share in a company or a unit of an equity oriented mutual fund shall be taxable at the rate of 15%, if the transaction is chargeable to STT

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The tax rates mentioned above stands increased by surcharge, payable at the rate of 5% where the taxable income of a domestic company exceeds Rs 10,000,000. Such surcharge rate would stand increased to 10% where the taxable income of the domestic company exceeds Rs 100,000,000. Further, education cess and secondary and higher education cess on the tax on total income and surcharge at the rate of 2% and 1% respectively is payable by all categories of taxpayers. As per section 74 of the IT Act short-term capital loss suffered during the year is allowed to be set-off against short-term as well as long-term capital gains of the said year. Balance loss, if any, could be carried forward for eight succeeding years for claiming set-off against subsequent years’ short-term as well as long-term capital gains. Long-term capital loss suffered during the year is allowed to be set-off against long-term capital gains. Balance loss, if any, could be carried forward for eight years for claiming set-off against subsequent eight year’s long-term capital gains. As per provisions of Section 70 read with Section 74 of the Act, short term capital loss arising during a year is allowed to be set-off against short term as well as long term capital gains. Balance loss, if any, shall be carried forward and set-off against any capital gains arising during subsequent 8 assessment years in terms of the provisions of section 74 of the IT Act. As per provisions of Section 70 read with Section 74 of the Act, long term capital loss arising during a year is allowed to be set-off only against long term capital gains. Balance loss, if any, shall be carried forward and set-off against long term capital gains arising during subsequent 8 assessment years in terms of the provisions of section 74 of the IT Act. Long term capital loss arising on sale of shares or units of equity oriented fund subject to STT may not be carried forward for set off.

5. Exemption of capital gains from income tax

As per the provisions of section 54EC of the IT Act and subject to the conditions specified therein capital gains arising to the Company on transfer of a long-term capital asset (other than those covered under section 10(38) of the IT Act) shall not be chargeable to tax to the extent such capital gains are invested in certain notified bonds within six months from the date of transfer subject to maximum of Rs 5 Millions. If only part of such capital gain is invested, the exemption shall be proportionately reduced. However, if the Company transfers or converts the notified bonds into money (as stipulated therein) within a period of three years from the date of their acquisition, the amount of capital gains exempted earlier would become chargeable in such year. The bonds specified for this section are bonds issued on or after April 1, 2007 by National Highways Authority of India (the “NHAI”) and the Rural Electrification Corporation Limited (the “REC”). The IT Act has restricted the maximum investment in such bonds upto Rs 5 million per assessee during any financial year and the subsequent financial year. The characterization of the gain/ losses, arising from sale/ transfer of shares/ units as business income or capital gains would depend on the nature of holding and various other factors.

6. Deduction of STT paid STT paid will be allowed as a deduction in the computation of business income. It is laid down that the STT paid during the year shall be allowed as a deduction under Section 36(1)(xv) on the condition that the income from taxable securities transaction is included under the head, “profits and gains of business or profession”. When such deduction is claimed, no further deduction in respect of the said amount is allowed while determining the income chargeable to tax as capital gains.

7. Other Provisions

a. As per the provisions of Section 35D of the Act, any specified preliminary expenditure incurred by an Indian company before commencement of business or after commencement of business in connection with extension of an undertaking or setting up a new unit shall be allowed a deduction equivalent to one-fifth of such expenditure for each of the five successive previous years beginning with the previous year in which the business is commenced/ extended. However, any deduction in excess of 5% of cost of project/ capital employed would be ignored.

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b. As per the provisions of Section 35DD of the Act, any expenditure incurred by an Indian

Company, wholly and exclusively for the purpose of amalgamation/ demerger of an undertaking shall be allowed as deduction to the extent of one-fifth of such expenditure for each of five successive previous years beginning with the previous year in which the amalgamation/ demerger takes place.

c. As per the provisions of Section 72A of the Act, pursuant to business re-organisations (such as amalgamation, demerger, etc), the successor company shall be allowed to carry forward any accumulated tax losses/ unabsorbed depreciation of the predecessor company subject to fulfilment of prescribed conditions.

d. As per section 10(34A) of the IT Act, any income arising to a shareholder, on account of buy back

of shares (not being listed on a recognized stock exchange) by a company, will be exempt from tax. This exemption is available to shareholders only in case where the company pays buy back tax under the provisions of section 115QA of the Act. Such income is also exempt from tax while computing book profit for the purpose of determination of MAT liability. However, in case of buy back of listed securities, it will be liable to capital gains tax

e. As per provisions of Section 80G of the Act, the assessee is entitled to claim deduction of a

specified amount in respect of eligible donations, subject to the fulfilment of the conditions specified in that section

f. As per provisions of Section 80GGB of the Act, the assesse is entitled to claim deduction

amounting to 100% of any sum contributed to any political party or an electoral trust

8. MAT credit

In terms of section 115JAA(1A) of the IT Act, the Company is eligible to claim credit for any tax paid as MAT under section 115JB of the IT Act for any Assessment Year commencing on or after April 1, 2006 against income tax liabilities incurred in subsequent years as prescribed.

MAT credit eligible in subsequent years is the difference between MAT paid and the tax computed

as per the normal provisions of the IT Act. Such MAT credit will be available for set-off up to ten years succeeding the year in which the MAT credit initially arose under section 115JAA(IA)

MAT credit can be set off in a year when tax is payable under the normal provisions of the IT Act.

MAT credit to be allowed shall be the difference between MAT payable and the tax computed as per the normal provisions of the IT Act for that assessment year.

(B) Benefits to the Resident shareholders of the Company under the IT Act 1. Dividends exempt under section 10(34) of the IT Act

Dividend (whether interim or final) received by a resident shareholder from its investment in shares of a domestic company would be exempt in the hands of the resident shareholder as per the provisions of section 10(34) read with section 115-O of the IT Act.

Section 14A read with Rule 8D of the IT Act restricts claim for deduction of expenses incurred in relation to income which does not form part of the total income under the IT Act. Thus, any expenditure incurred to earn the said tax free income will not be a tax deductible expenditure.

2. Computation of capital gains

Capital assets are to be categorized into short-term capital assets and long-term capital assets based on the period of holding. All capital assets [except a security (other than a unit) listed in a recognized stock exchange of India or units of Unit Trust of India (‘UTI’) or a unit of an equity oriented fund and zero coupon bonds] are considered to be long-term capital assets, if they are held for a period exceeding thirty-six months. Security (other than a unit) listed in a recognized stock exchange of India or units of Unit Trust of India (‘UTI’) or a unit of an equity oriented fund and zero coupon bonds are

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considered as long-term capital assets, if these are held for a period exceeding twelve months. The Finance (No.2) Act 2014 has however inserted second proviso to section 2(42A) w.e.f 1.4.2015 which provides that in the case of capital assets representing shares held in a company not being shares listed on a recognized stock exchange or units of Mutual Fund specified under clause (23D) of Section 10 which is transferred between 1st April 2014 and 10th July 2014 are treated as short term capital assets if they are not held for more than twelve months. As per the provisions of section 48 of the IT Act, the amount of capital gain shall be computed by deducting from the sale consideration, the cost of acquisition and expenses incurred in connection with the transfer of a capital asset. However, in respect of long-term capital gains arising to a resident shareholder, a benefit is permitted to substitute the cost of acquisition/ improvement with the indexed cost of acquisition/ improvement. The indexed cost of acquisition/ improvement, adjusts the cost of acquisition/ improvement by a cost inflation index, as prescribed from time to time.

As per the provisions of section 10(38) of the IT Act, long term capital gain arising to a resident shareholder from transfer of a long term capital asset or units of equity oriented mutual fund being an equity share in a company listed on a recognized stock exchange in India, shall be exempt from tax, if the transaction is chargeable to STT. As per provisions of Section 48 of the Act, LTCG arising on transfer of capital assets, other than bonds and debentures (excluding capital indexed bonds issued by the Government) and depreciable assets, is computed by deducting the indexed cost of acquisition and indexed cost of improvement from the full value of consideration. As per the provisions of section 112 of the IT Act, long-term capital gains (other than those covered under section 10(38) of the IT Act) are subject to tax at a rate of 20%. However, proviso to section 112(1) specifies that if the long-term capital gains [other than those covered under section 10(38) of the IT Act] arising on transfer of listed securities (other than a unit) or zero coupon bond, calculated at the rate of 20% with indexation benefit exceeds the capital gains computed at the rate of 10% without indexation benefit, then such capital gains are chargeable to tax at the rate of 10% without indexation benefit. Second proviso to S112(1) specifies that in respect of long term arising on account of transfer of unit of a mutual fund specified under S10(23D) between 1st April 2014 and 10th July 2014 exceeds the capital gains computed at the rate of 10% without indexation benefit, then such capital gains are chargeable to tax at the rate of 10% without indexation benefit. As per provisions of section 111A of the IT Act, short term capital gains arising from transfer of short term capital asset, being an equity share in a company or a unit of an equity oriented mutual fund shall be taxable at the rate of 15%, if the transaction is chargeable to STT. The tax rates mentioned above stands increased by surcharge, payable at the rate of 5% where the taxable income of a domestic company exceeds Rs 10,000,000. Such surcharge rate would stand increased to 10% where the taxable income of the domestic company exceeds Rs 100,000,000. Further, education cess and secondary and higher education cess on the tax on total income and surcharge at the rate of 2% and 1% respectively is payable by all categories of taxpayers. As per provisions of Section 70 read with Section 74 of the Act, short term capital loss arising during a year is allowed to be set-off against short term as well as long term capital gains. Balance loss, if any, shall be carried forward and set-off against any capital gains arising during subsequent 8 assessment years in terms of the provisions of section 74 of the IT Act As per provisions of Section 70 read with Section 74 of the Act, long term capital loss arising during a year is allowed to be set-off only against long term capital gains. Balance loss, if any, shall be carried forward and set-off against long term capital gains arising during subsequent 8 assessment years in terms of the provisions of section 74 of the IT Act

3. Exemption of capital gains arising from income tax

As per the provisions of section 54EC of the IT Act and subject to the conditions specified therein capital gains arising to a resident shareholder on transfer of a long-term capital asset (other than those

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covered under section 10(38) of the IT Act) shall not be chargeable to tax to the extent such capital gains are invested in certain notified bonds within six months from the date of transfer. If only part of such capital gain is invested, the exemption shall be proportionately reduced. However, if the resident shareholder transfers or converts the notified bonds into money (as stipulated therein) within a period of three years from the date of their acquisition, the amount of capital gains exempted earlier would become chargeable in such year. The bonds specified for this section are bonds issued on or after April 1, 2007 by National Highways Authority of India (the “NHAI”) and the Rural Electrification Corporation Limited (the “REC”). The IT Act has restricted the maximum investment in such bonds upto Rs 5 million per assessee during any financial year or in the subsequent financial year. Further, as per the provisions of section 54F of the IT Act and subject to conditions specified therein, long-term capital gains (other than capital gains arising on sale of resident house and those covered under section 10(38) of the IT Act) arising to an individual or Hindu Undivided Family (‘HUF’) on transfer of shares of the Company will be exempted from capital gains tax, if the net consideration from such shares are used for either purchase of one residential house property in India within a period of one year before or two years after the date on which the transfer took place, or for construction of one residential house property in India within a period of three years after the date of transfer.

4. Deduction of STT paid

STT paid will be allowed as a deduction in the computation of business income. It is laid down that the STT paid during the year shall be allowed as a deduction under Section 36 on the condition that the income from taxable securities transaction is included under the head, “profits and gains of business or profession”. When such deduction is claimed, no further deduction in respect of the said amount is allowed while determining the income chargeable to tax as capital gains.

5. In case of an individual or HUF, where the total taxable income as reduced by capital gains is below

the basic exemption limit, the capital gains will be reduced to the extent of the shortfall and only the balance long-term capital gains or short term capital gains will be subjected to such tax in accordance with the proviso to sub-section (1) of Sections 111A and 112 of the IT Act.

6. As per provisions of Section 56(2)(vii) of the Act and subject to exception provided in second proviso

therein, where an individual or HUF receives shares and securities without consideration or for a consideration which is less than the aggregate fair market value of the shares and securities by an amount exceeding fifty thousand rupees, the excess of fair market value of such shares and securities over the said consideration is chargeable to tax under the head 'income from other sources'. However, the said section is not applicable in case the shares and securities are received under instances specified under the proviso thereon.

(C) Benefits to the Non-resident shareholders of the Company other than Foreign Institutional

Investors and Foreign Venture Capital Investors 1. Dividends exempt under section 10(34) of the IT Act

Dividend (whether interim or final) received by a non-resident shareholder from its investment in shares of a domestic company would be exempt in the hands of the non-resident shareholder as per the provisions of section 10(34) read with section 115-O of the IT Act. Section 14A read with Rule 8D of the IT Act restricts claim for deduction of expenses incurred in relation to income which does not form part of the total income under the IT Act. Thus, any expenditure incurred to earn the said tax free income will not be a tax deductible expenditure.

2. Computation of capital gains

Capital assets are to be categorized into short-term capital assets and long-term capital assets based on the period of holding. All capital assets [except a security (other than a unit) listed in a recognized

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stock exchange of India or units of Unit Trust of India (‘UTI’) or a unit of an equity oriented fund and zero coupon bonds] are considered to be long-term capital assets, if they are held for a period exceeding thirty-six months. Security (other than a unit) listed in a recognized stock exchange of India or units of Unit Trust of India (‘UTI’) or a unit of an equity oriented fund and zero coupon bonds are considered as long-term capital assets, if these are held for a period exceeding twelve months. The Finance (No.2) Act 2014 has however inserted second proviso to section 2(42A) w.e.f 1.4.2015 which provides that in the case of capital assets representing shares held in a company not being shares listed on a recognized stock exchange or units of Mutual Fund specified under clause (23D) of Section 10 which is transferred between 1st April 2014 and 10th July 2014 are treated as short term capital assets if they are not held for more than twelve months. As per the provisions of section 48 of the IT Act, the amount of capital gain shall be computed by deducting from the sale the consideration, the cost of acquisition and expenses incurred in connection with the transfer of a capital asset. Under first proviso to section 48 of the IT Act, the taxable capital gains arising on the transfer of capital assets being shares or debentures of an Indian company need to be computed by converting the cost of acquisition, expenditure in connection with such transfer and full value of the consideration received or accruing as a result of the transfer into the same foreign currency in which the shares were originally purchased. The resultant gains thereafter need to be reconverted into Indian currency. The conversion needs to be done at the prescribed rates prevailing on dates stipulated. Hence, in computing such gains, the benefit of indexation is not available to non-resident shareholders. As per the provisions of section 10(38) of the IT Act, long term capital gain arising to a non-resident shareholder from transfer of a long term capital asset being an equity share in a company listed on a recognized stock exchange in India or units of equity oriented mutual fund, shall be exempt from tax, if the transaction is chargeable to STT. In case of an individual or HUF, where the total taxable income as reduced by capital gains is below the basic exemption limit, the capital gains will be reduced to the extent of the shortfall and only the balance long-term capital gains or short term capital gains will be subjected to such tax in accordance with the proviso to sub-section (1) of sections 111A and 112 of the IT Act. As per provisions of section 111A of the IT Act, short term capital gains arising from transfer of short term capital asset, being an equity share in a company or a unit of an equity oriented mutual fund shall be taxable @ 15%, if the transaction is chargeable to STT. The tax rates mentioned above stands increased by surcharge, payable at the rate of 5% where the taxable income of a domestic company exceeds Rs 10,000,000. Such surcharge rate would stand increased to 10% where the taxable income of the domestic company exceeds Rs 100,000,000. Further, education cess and secondary and higher education cess on the tax on total income and surcharge at the rate of 2% and 1% respectively is payable by all categories of taxpayers.

As per provisions of Section 70 read with Section 74 of the Act, short term capital loss arising during a year is allowed to be set-off against short term as well as long term capital gains. Balance loss, if any, shall be carried forward and set-off against any capital gains arising during subsequent 8 assessment years in terms of the provisions of section 74 of the IT Act As per provisions of Section 70 read with Section 74 of the Act, long term capital loss arising during a year is allowed to be set-off only against long term capital gains. Balance loss, if any, shall be carried forward and set-off against long term capital gains arising during subsequent 8 assessment years in terms of the provisions of section 74 of the IT Act

3. Exemption of capital gain from income-tax

As per the provisions of section 54EC of the IT Act and subject to the conditions specified therein capital gains arising to a non-resident shareholder on transfer of a long-term capital asset (other than those covered under section 10(38) of the IT Act) shall not be chargeable to tax to the extent such capital gains are invested in certain notified bonds within six months from the date of transfer. If only part of such capital gain is invested, the exemption shall be proportionately reduced.

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However, if the non-resident shareholder transfers or converts the notified bonds into money (as stipulated therein) within a period of three years from the date of their acquisition, the amount of capital gains exempted earlier would become chargeable in such year. The bonds specified for this section are bonds issued on or after April 1, 2007 by NHAI and REC. The IT Act has restricted the maximum investment in such bonds upto Rs 5 million per assessee during any financial year and subsequent financial year. As per provisions of Section 56(2)(vii) of the Act and subject to exception provided in second proviso therein, where an individual or HUF receives shares and securities without consideration or for a consideration which is less than the aggregate fair market value of the shares and securities by an amount exceeding fifty thousand rupees, the excess of fair market value of such shares and securities over the said consideration is chargeable to tax under the head 'income from other sources'. However, the said section is not applicable in case the shares and securities are received under instances specified under the proviso thereon.

4. Tax Treaty Benefits

Under the provisions of section 90(2) of the IT Act, a non-resident will be governed by the provisions for the Agreement for Avoidance of Double Taxation (DTAA) between India and the country of residence of the non-residence and the provisions of IT Act apply only to the extent they are more beneficial to the assesse. It needs to be noted that a non-resident is required to hold a valid tax residency certificate containing the particulars prescribed under Notification No. 57 of 2013 dated 1 August 2013 issued by the Central Board of Direct Taxes in order to claim benefits under the applicable tax treaty.

5. Non-Resident Indian taxation

Under section 115-I of the IT Act, the non-resident Indian shareholder has an option not to be governed by the provisions of Chapter XIIA of the IT Act viz. “Special Provisions Relating to Certain Incomes of Non-Residents” which are as follows:

a. Under section 115E of the IT Act, where shares in an Indian company are acquired or subscribed

to in convertible foreign exchange by a non-resident Indian, capital gains arising to the non-resident on transfer of shares held for a period exceeding 12 months, will [in cases not covered under section 10(38) of the IT Act], be concessionally taxed at the flat rate of 10% (plus applicable surcharge and cess) (without indexation benefit but with protection against foreign exchange fluctuation).

b. Under provisions of section 115F of the IT Act, long-term capital gains [in cases not covered

under section 10(38) of the IT Act] arising to a non-resident Indian from the transfer of shares of the company subscribed to in convertible foreign exchange will be exempt from income tax, if the net consideration is reinvested in specified assets within six months of the date of transfer. If only part of the net consideration is so reinvested, the exemption will be proportionately reduced. However the amount so exempted will be chargeable to tax subsequently, if the specified assets are transferred or converted into money within three years from the date of their acquisition.

c. Under provisions of section 115G of the IT Act, non-resident Indians are not required to file a return of income under section 139(1) of the IT Act, if their only income is income from forex asset investments or long-term capital gains in respect of those assets or both, provided tax has been deducted at source from such income as per the provisions of Chapter XVII-B of the IT Act.

d. Under section 115H of the IT Act, where the non-resident Indian becomes assessable as a resident in India, such person may furnish a declaration in writing to the Assessing Officer, along with the return of income for that year under section 139 of the IT Act to the effect that the provisions of the Chapter XIIA will continue to apply to such person in relation to the investment income derived from the specified assets for that year and subsequent assessment years until such assets are converted into money and if he does so, the provisions of chapter XIIA shall continue to apply to him in relation to such income.

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e. As per provisions of Section 115-I of the Act, a NRI can opt not to be governed by the provisions of Chapter XII-A for any assessment year by furnishing return of income for that assessment year under Section 139 of the Act, declaring therein that the provisions of the chapter shall not apply for that assessment year and accordingly his total income for that assessment year will be computed in accordance with the other provisions of the Act.

(D) Benefits to Foreign Institutional Investors (‘FII’) 1. Dividends exempt under section 10(34) of the IT Act

Dividend (whether interim or final) received by a FII from its investment in shares of a domestic company would be exempt in the hands of the FII as per the provisions of section 10(34) read with section 115-O of the IT Act.

Section 14A read with Rule 8D of the IT Act restricts claim for deduction of expenses incurred in relation to income which does not form part of the total income under the IT Act. Thus, any expenditure incurred to earn the said tax free income will not be a tax deductible expenditure.

2. Long term capital gains exempt under section 10(38) of the IT Act.

As per the provisions of section 10(38) of the IT Act, long term capital gain arising to the FII from transfer of a long term capital asset being an equity share in a company listed on a recognized stock exchange in India or units of equity oriented mutual fund, shall be exempt from tax, if the transaction is chargeable to STT.

3. Capital gains

As per the provisions of section 115AD of the IT Act, FIIs are taxed on the capital gains income at the following rates:

Rate of tax Nature of Income (%) Long-term capital gains 10 Short-term capital gains covered u/s 111A 15 Short-term capital gains 30 For corporate FIIs, the tax rates mentioned above stands increased by a surcharge, payable at the rate of 2% where the taxable income exceeds Rs 10,000,000. Such surcharge would stand increased to 5% where the taxable income exceeds Rs 100,000,000. Further, education cess and secondary and higher education cess on the tax on total income and surcharge at the rate of 2% and 1% respectively is payable. The benefits of foreign currency fluctuation protection and indexation as provided by Section 48 of the IT Act are not available to a FII. No income tax is deductible on income by way of Capital Gains, in case the same is arising in the hands of residents. As per Section 195 of the IT Act, any income payable to non-resident, may fall within the ambit of with-holding provisions, subject to the provisions of the relevant tax treaty. Accordingly, income tax may have to be deducted at source in the case of a non-resident at the rate prescribed under the domestic tax laws or under the tax treaty, whichever is beneficial to the assessee unless a lower withholding certificate is obtained from the tax authorities. As per provisions of 196D of the Act, taxes shall not be withheld from any income in the nature of capital gains arising to FIIs from transfer of securities specified in Section 115AD of the Act. Further, capital gains arising on transfer of other securities would be subject to withholding tax at the rate of 20%. Any interest income arising to FIIs in respect of investment in rupee denominated bonds of an Indian company or a Government security between 1 June 2013 and 1 June 2015 would be subject to tax deduction at source at 5% u/s 194LD.

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As per the provisions of section 10(38) of the IT Act, long term capital gain arising to FII from transfer of a long term capital asset being an equity share in a company listed on a recognized stock exchange in India or units of equity oriented mutual fund, shall be exempt from tax, if the transaction is chargeable to STT.

As per provisions of section 111A of the IT Act, short term capital gains arising from transfer of short term capital asset, being an equity share in a company or a unit of an equity oriented mutual fund shall be taxable at the rate of 15%, if the transaction is chargeable to STT. The benefit of exemption under Section 54EC of the Act mentioned above in case of the Company is also available to FIIs. As per the provisions of Section 10(34A) of the Act, any income arising to shareholders on account of buy-back of unlisted shares shall be exempt in the hands of the shareholders. This exemption is available to shareholders only in case where the company pays buy back tax under the provisions of section 115QA of the Act.

4. Tax Treaty Benefits

As per section 90(2) of the IT Act, the provisions of the IT Act would prevail over the provisions of the tax treaty to the extent they are more beneficial to the FII. Thus, an FII can opt to be governed by provisions of the IT Act or the applicable tax treaty whichever is more beneficial. It needs to be noted that a non-resident is required to hold a valid tax residency certificate containing the particulars prescribed under Notification No. 57 of 2013 dated 1 August 2013 issued by the Central Board of Direct Taxes in order to claim benefits under the applicable tax treaty.

(E) Benefits to Venture Capital Companies / Funds under the Act

In terms of section 10(23FB) of the Act, all Venture capital companies/funds registered with Securities and Exchange of India, subject to the conditions specified, are eligible for exemption from income tax on all their income, including profit on sale of shares of the Company. However, the income distributed by the Venture Capital Companies/Funds to its investors would be taxable in the hands of the recipient.

(F) Benefits to the Mutual Funds

As per the provisions of section 10(23D) of the IT Act, any income of the Mutual Funds registered under the Securities and Exchange Board of India Act, 1992 (“SEBI”) or regulations made thereunder, Mutual Funds set up by public sector banks or public financial institutions or Mutual Funds authorised by the Reserve Bank of India, would be exempt from income tax, subject to the prescribed conditions.

(G) Under the Wealth-tax Act, 1957 (Common to all)

Asset as defined under section 2(ea) of the Wealth-tax Act, 1957 does not include shares in companies and hence, shares are not liable to wealth tax.

(H) Under the Gift Tax Act.

Gift Tax is not leviable in respect of any gifts made on or after 1st October, 1998. Therefore any gifts of Shares will not attract gift-tax. However any transfer of shares made on or after 1, October 2009 without consideration or for inadequate consideration to an Individual or HUF will be taxable in the hands of receiver under clause (vii) of Section 56(2) of the Income Tax Act, 1961 subject to the prescribed condition and valuation rules. We have not commented on the taxation aspect under any law for the time being in force, as applicable, of any country other than India. Each investor is advised to consult its own tax consultant for taxation in any country other than India.

Notes: 1. All the above benefits are as per the current tax law.

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2. The stated benefits will be available only to the sole/first named holder in case the share are held by

joint holders

3. In respect of non-residents, the tax rates and the consequent taxation mentioned above will be further subject to any benefits available under the relevant DTAA, if any, between India and the country in which the non-resident has fiscal domicile.

4. In view of the individual nature of tax consequences, each investor is advised to consult his/her own tax advisor with respect to specific tax consequences of his/her participation in the scheme.

5. The above statement of possible direct tax benefits set out the provisions of law in a summary manner only and is not a complete analysis or listing of all potential tax consequences of the purchase, ownership and disposal of equity shares.

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LEGAL PROCEEDINGS

Our Company and its Subsidiaries from time to time are involved in various legal proceedings, most of which arise from the ordinary course of business that we and our SPVs are engaged in. As of the date of this Placement Document, disclosed hereunder, are governmental, legal or arbitration proceedings or litigation that we are involved in.

Litigation involving our Company

Litigation by Company

Civil Proceedings

1. GIPL had submitted a bid on January 10, 2011 along with the requisite bank guarantee dated January 08, 2011 for ₹1,397 lakhs issued by Canara bank, Mumbai branch pursuant to a request for qualification issued by NHAI in November 2010. GIPL noticed that the date of expiry of the bank guarantee was mentioned as June 30, 2011 instead of July 30, 2011. GIPL took up the matter with Canara bank and obtained an extended bank guarantee expiring on July 30, 2011. The extended bank guarantee was submitted to NHAI immediately and GIPL requested NHAI to open its bid which was to be held on January 13, 2011 along with other bids. Though the bid was opened on January 13, 2011 by NHAI, they informed GIPL on January 15, 2011 that the bid was found nonresponsive and asked GIPL to deposit ₹ 69.85 lakhs failing which NHAI would proceed for partial encashment of the submitted bank guarantee of ₹ 1,397 lakhs. However it was argued that the disputed amount was only ₹69,85,000 which was 5% of the bid security. GIPL filed a writ petition in the Delhi high court challenging the action of NHAI. On February 7, 2011 the high court of Delhi passed an interim order staying the demand and encashment of bank guarantee by NHAI. On November 15, 2011 the division bench of the high court of Delhi held that the forfeiture of the 5% bank guarantee amount by NHAI is invalid, further the matter was adjourned with liberty to the parties to revive the petition as and when the occasion arises, interim order shall continue to be in force till further orders subject to the bank guarantee being kept alive by GIPL. The high court of Delhi also directed GIPL to keep the validity of the bank guarantee till the next date of hearing. On October 31, 2013 the high court of Delhi by an order reduced the bank guarantee amount to ₹ 70 lakhs instead of the total bid amount i.e.₹ 1,400 lakhs. The writ petition is yet to be listed for hearing.

Litigation against Company

Tax Proceedings

1. The Income Tax department issued block assessment orders raising demand under section 156 of the Income Tax Act for the assessment years 2007-08 to 2011-12 with GIPL. The total demand raised by the Income Tax authorities for the abovementioned assessment years is ₹ 2,090.42 lakhs which is as a result of the deductions being claimed by GIPL under Section 80-IA of the Income Act. On perusal of details it was found that the Company has claimed deduction under section 80 IA read with section 80IA (4) of the Income Tax Act for the assessment years 2007-08 ₹399.30 lakhs, 2008-09 ₹835.58 lakhs, 2009-10 ₹ 904.57 lakhs, 2010-11 ₹ 1,128.12 lakhs, 2011-2012 ₹1,999.52 lakhs on account of the developer fees received for providing project advisory services. Out of the total amount the Company proportionately deducted the expenses and hence sought a deduction of the balance amounts. The Company has filed appeals dated April 30, 2013 with the Commissioner of Income Tax Mumbai against the said orders. An Income Tax hearing is also pending with the Income Tax Appellate Tribunal on the similar matter for the assessment Year 2007-08. The matters have not yet been listed for hearing.

Litigation involving the Subsidiaries

Litigation involving CBICL

Litigation against CBICL

Civil Proceedings:

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1. Mr. V. J. Hycinth filed a suit on October 25, 2013 against GIL, CBICL, State of Kerala and Greater Cochin Development Authority (GCDA) seeking an order from the court restraining GIL and CBICL by way of permanent prohibitory injunction from collecting the toll fee from the public for utilizing the Mattenchary BOT bridge. He also sought by an interim application mandatory injunction against GIL and CBICL to return the amount which was collected from the public towards the toll fee from August 27, 2013 onwards .Vide order dated November 29, 2013 the honourable court rejected the interim application in view of the fact of pendency of arbitration proceedings between CBICL and GCDA & GoK. The matter is pending before the Munsiff court, Kochi for hearing.

Litigation by CBICL

Civil Proceedings:

1. CBICL made an application under section 9 of the Arbitration and Conciliation Act, 1996 on April 22, 2014 to the district court, Ernakulum seeking an order of temporary prohibitory injunction restraining Greater Cochin Development Authority (“GCDA”), and their agents from causing any sort of obstruction in the matter of collecting toll/ user fee from the Mattancherry Bridge and also a mandatory injunction directing GCDA to issue sealed coupons to CBICL to enable it to collect toll from the users of Mattancherry Bridge after April 27, 2013.CBICL also sought that the Commissioner of Police Cochin city be directed to render police protection to the employees of CBICL for the collection of the toll and other aspects in relation to the toll collection of the Mattancherry Bridge as well as protection to the persons engaged in collection of the toll. An application was moved before the court seeking adjournment for amending the pleadings. The matter is posted for further hearing.

2. CBICL moved a petition under Article 227 of the Constitution of India in the high court of Kerala,

seeking the following:

(i) direction to GCDA not to interfere with the collection of the toll/ user fee by CBICL from the vehicles passing through the Mattanchery Bridge till a final decision is taken by the honourable arbitrators in the arbitration matter as referred hereinbelow under the head “Arbitration Proceedings” which is pending before them, and ,

(ii) direction to GCDA to issue sealed coupons to CBICL strictly in accordance with the judgment

passed by this court in writ petition (C) no. 13178/2007, for enabling the petitioner to collect toll till a final decision is taken by the honourable arbitrators in the arbitration matter pending before them.

The High Court orally informed the counsel of GCDA not to take any steps interfering with the toll collection in the Mattancherry Bridge till a decision is taken in the case at the district court, Ernakulum. On April 29, 2014 the high court rejected the petition on the ground that the concession agreement has already expired and the court does not have power to extend the period of concession.

Arbitration Proceedings:

1. CBICL initiated arbitration proceedings against GCDA and GoK on January 18, 2008, for the payment of a claim amount of ₹ 1,063.95 lakhs as of December, 2010 and thereafter every year ₹154 lakhs until April 27, 2020 arising on account of cancellation of the government order dated January 24,2005 and March 01,2005 and restricting the Company from escalating the toll rates for each year based on change in WPI and for loss of revenue due to the change in the understanding with respect to multiple entry of cars. The last dates for hearing of the arbitration proceedings were fixed from June 18 to June 20, 2013. After taking into consideration the settlement talks, both parties jointly sought adjournment and the matter was adjourned without fixing the next date of hearing. The next date of hearing shall be fixed once the outcome of the settlement is known. The Company seeks to direct the authority to withdraw government order dated December 26, 2008 and October 05, 2010, direct the authority to pay the claim amount and annuity payments and hold the concession agreement dated October 27, 1999 and the supplementary agreement dated January 6, 2001 valid and binding. The matter shall be taken up for hearing (respondent’s final arguments) by the arbitrators only on receipt of information from the claimant and the respondents stating the outcome of the settlement negotiations.

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Litigation involving AEL

Litigation by AEL

Arbitration Proceedings:

1. AEL initiated arbitration proceedings against NHAI on April 22, 2008 for non-payment of bonus to AEL amounting to ₹ 465.20 lakhs plus interest at the rate of State Bank of India, prime lending rate plus 3%. On September 14, 2009 AEL was awarded the claim along with interest at the rate of 9% per annum with effect from May 30, 2005 plus an additional cost of ₹ 5 lakhs. Aggrieved by the award, both NHAI and AEL appealed in the high court of Delhi where the arbitration award was modified and AEL was awarded interest at the rate of State Bank of India, prime lending rate plus 3% on the principal amount of claim and the interest for the post award period at the rate of 9% per annum. Being aggrieved by the order of the single bench of the high court of Delhi, NHAI filed an appeal no.FAO (OS) 605/2011, before the division bench of the high court of Delhi which was dismissed on December 12, 2011. Against the division bench orders, NHAI filed a special leave petition no (C) 11130/2012 in the Supreme Court of India, which was dismissed on February 26, 2014 and the order of the High Court of Delhi was upheld.

Litigation against AEL

Tax Proceedings 1. The Income Tax department has issued block assessment orders raising demand under section 156 of

the Income Tax Act for the assessment years 2005-06 to 2011-12 with AEL. The total demand raised by the Income Tax authorities for the abovementioned assessment years is ₹ 3,495.98 lakhs which is as a result of the deductions being claimed by AEL under Section 80-IA of the Income Act. The Company has filed appeals dated May 01, 2013 with the Commissioner of Income Tax (Appeals) Mumbai. The matters have not yet been listed for hearing.

Litigation involving GLL

Litigation against GLL Arbitration Proceedings: 1. Go Airlines India Private Limited initiated arbitration proceedings against GLL on October 10, 2010

for non - payment by GLL for the logistical services availed of Go Air. Now, Go Air seeks a total payment of ₹143.98 lakhs along with interest by GLL. GLL also filed a counter claim wherein GLL has sought an order rejecting Go Air’s claims and directing Go Air to pay a sum of ₹13.99 lakhs. Both GLL and Go Air have been directed to provide original documents for inspection by the arbitrators before the next date of hearing which shall be mutually decided upon inspection of the said original documents.

Litigation by GLL 1. GLL filed 16 complaints against Eswar Air Cargo Forwarders for an amount of ₹137.93 lakhs for the

cheques dishonored by the banks. The cheques handed over by Eswar Air Cargo Forwarders for providing the services of logistics work. GLL has sought for imposition of fine and/or imprisonment of the representatives of Eswar Air Cargo Forwarders. The matter is presently pending before 7th MM Court, Bhoiwada, Dadar, Mumbai and up for hearing. Eswar Air Cargo Forwarders had also filed an application before the Chief Metropolitan Magistrate Court to transfer the 16 cases, as the 7th MM Court did not record the cross examination of the Complainant’s witness properly which was rejected by the Chief Metropolitan Magistrate Court. Eswar Air Cargo Forwarders also filed a separate application in the sessions court, Mumbai being criminal revision application no. 28/2014 against the orders dated November 25, 2013 (allowing the accused for further cross examination of the witness of the complainant after awarding cost of ₹ 0.05 lakhs).The matter is pending before the sessions court, Mumbai.

2. GLL filed 29 complaints against GRS Cargo Services for an amount aggregating to ₹ 45.00 lakhs for

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the cheques dishonored by the banks. GLL has sought for imposition of fine and/or imprisonment of the representatives of GRS Cargo Services. The matter has been adjourned to August 08, 2014 for evidence of the complainant.

3. GLL filed 2 complaints against Spectrum Company. Loaders cum Freighters and 7 complaints

Shubham International for the cheques dishonored by the banks for an amount aggregating to ₹12.00 lakhs and ₹7.56 lakhs respectively. GLL has sought for imposition of fine and/or imprisonment of the representatives of Spectrum Co. Loaders cum Freighters and Shubham International. The matter is adjourned for hearing on July 30, 2014.

GLL filed 2 complaints against R. Haridoss for an amount aggregating to ₹15.90 lakhs for the cheques dishonored by the banks. GLL has sought for imposition of fine and/or imprisonment of the R. Haridoss. The matter is adjourned for hearing.

Litigation involving ICTPL

Litigation against ICTPL Civil Proceedings 1. Maharashtra Navanirman Kamgar Sena representing 35 employees of ICTPL filed a complaint before

Industrial Court, Bandra, Mumbai, prior to October, 2012, alleging unfair labour practices being followed by the management of ICTPL. Maharashtra Navanirman Kamgar Sena sought reliefs restraining ICTPL to indulge in unfair labour practices and till the final disposal of the complaint restrain ICTPL from terminating the services of the aforesaid 35 employees. Time and again the matter has been postponed for hearing. Finally September 11, 2014 has been fixed as the next date of hearing.

Litigation involving MNEL

Litigation against MNEL Civil Proceedings 1. Vakas Mushtaq Patel & others filed a writ petition on March 30, 2010, praying for quashing the

notification under section 3D(ii) dated December 12,2008 and the notification issued under Section 3A(i) dated December 17,2007 issued under the provisions of the National Highways Act, 1956 under which declaration was made for acquisition of land nearby toll plaza stretch at village Arjun Ali. Vakas Mushtaq Patel seeks quashing the notification under section 3D(ii) dated December 12,2008 and the notification issued under Section 3A(i) dated December 17,2007 issued under the provisions of the National Highways Act, 1956. Although the matter was listed for hearing on August 20, 2014, but it did not reach.

2. Trambak Parbat Chavan filed a suit in the Civil Court, Igatpuri seeking possession of land taken on

lease by MNEL and also claiming arrears of rent of ₹ 2.50 lakhs. The respondent in its written statement filed on July 15, 2012 denied the allegations made by the plaintiff in the plaint. The plaintiff seeks to take back the possession of the land which was leased to MNEL with the arrears amounting to ₹ 2.50 lakhs. MNEL has contended that the leased land has since been acquired by NHAI after following due process of law hence the plaintiff is not entitled to the relief sought for. The matter has been progressing constantly and is now adjourned for examination of NHAI officials therefore summons directing NHAI officials to remain present before the honourable court has been issued.

Litigation involving MTL

Litigation by MTL Civil Proceedings 1. MTL entered into a concession agreement with Mormugao Port Trust for providing Mechanised

Handling Facilities for handling of Coal at Berth No. 11 at Mormugao Port, Goa on DBFOT basis. MTL also issued a bank guarantee in favour of Mormugao Port Trust for ₹ 200.00 lakhs from Canara

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Bank, Fort, Mumbai. Due to delays in achieving conditions precedent, both the parties kept on extending the achievement of all condition precedents. On March 13, 2014 Mormugao Port Trust sent an e-mail to MTL denying grant of any further extension and also conveying that the concession agreement stands terminated in terms of clause 3.6 of the concession agreement. Further, it was also informed that action would be initiated to encash the bank guarantee. MTL disagreed with this unilateral action and sought relief in the Court of the Principal District Judge, South Goa that Mormugao Port Trust and the bank be restrained severally from any manner from enchasing the bank guarantee and in the alternative hon’ble Court be pleased to direct the bank not to encash the bank guarantee, so that the same could be secured and ex-parte injunction be granted. Presently Canara Bank was directed to file its written statement however on July 02, 2014 Canara bank submitted that they don’t intend to file any reply and the matter is posted to September 20, 2014 for orders.

Litigation involving REL

Litigation against REL Tax Proceedings:

1. The Income Tax department has issued block assessment orders raising demand under section 156 of the Income Tax Act for the assessment years 2005-06 to 2011-12 with REL. The total demand raised by the Income Tax authorities for the abovementioned assessment years is ₹3,817.71 lakhs, which is a result of the deductions being claimed by REL under Section 80-IA of the Income Act. The Company has filed appeals dated May 01, 2013 with the Commissioner of Income Tax (Appeals) Mumbai. The matters have not yet been listed for hearing.

Litigations by REL

Civil Proceedings

1. Rajahmundry Expressway Limited (“REL”) had initiated arbitration proceedings against NHAI on April 22, 2008 for non-payment of bonus to REL amounting to ₹ 1,110.78 lakhs plus interest at the rate of State Bank of India, prime lending rate plus 3%. On November 11, 2009 AEL was awarded the claim along with interest at the rate of 9% per annum with effect from May 30, 2005 plus an additional cost of ₹5.00 lakhs. Aggrieved by the award, NHAI appealed in the high court of Delhi which was rejected on August 11, 2011 against the said orders NHAI filed an appeal before the division bench of the high court of Delhi which was dismissed on November 4, 2011. NHAI further filed a special leave petition (c) 8091 of 2012 in the Supreme Court of India against the said orders which was dismissed on February 26, 2014 and the order of the High Court of Delhi was upheld.

2. REL challenged the demand of the stamp duty by the collector of stamps, Rajahmundry for ₹ 1,776.99

lakhs in the High Court of erstwhile Andhra Pradesh at Hyderabad. The high court vide its order dated April 28, 2005, stayed the order of the collector of stamps dated March 15, 2005 for a period of 6 weeks, further GIPL sought extension but the same was rejected by the high court of Andhra Pradesh. However, the collector of stamps appears to have not initiated any further proceedings to recover the amount claimed as the petition is still pending before the high court of Andhra Pradesh Further the matter is yet to be listed in the court for hearing.

Litigation involving RGBL

Litigation against RGBL Tribunals 1. RGBL, executed a registered mortgage deed with document no. 1746/2010 on July 19, 2010 in favor of

Canara Bank as the Security Trustee. A sum of ₹10.01 lakhs was paid towards stamp duty after adjudication by pay order no.183572 dated July 06, 2010 in the General Stamp Office, Fort, Mumbai. The stamp authorities have demanded a sum of ₹103.20 lakhs being the deficit in stamp duty paid on the mortgage deed. The representative of RGBL appeared on March 18, 2014 and sought adjournment for want of case details therefore the matter was posted on April 23, 2014 thereafter the matter is adjourned to September 3, 2014.

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Litigation involving VSPL

Litigation against VSPL Civil Proceedings

1. A writ petition has been filed before the Andhra Pradesh High Court by Visakha Harbour and Port Workers Union against the government of India, the Visakhapatnam Port Trust (“VPT”), the Visakhapatnam Dock Labour Board and VSPL challenging the engagement of private workers by VSPL for dock work, without engaging the dock workers registered with the Labour Board under the Visakhapatnam Dock Workers (Regulation of Employment) Scheme, 1959. It was alleged that the provisions of the Dock Workers (Regulation of Employment) Act, 1948 have been violated by VSPL and by the other respondents which allowed VSPL to do so. The matter is currently pending in the Lok Adalat.

2. VSPL has received a show cause cum demand notice dated July 21, 2011 from the collector and district registrar, Visakhapatnam alleging deficit payment of stamp duty on the license agreement dated November 28, 2011 entered into between VSPL and Visakhapatnam Port Trust. The district registrar has classified the said license agreement as a lease agreement as has accordingly imposed a higher stamp duty. The amount involved in the matter is ₹470.55 lakhs. The Company submitted a detailed representation on September 19, 2011 pointing out that Lease agreement for the lands covered under the License agreement has been separately executed and applicable stamp duty on the same already paid. Further License agreement per se is not covered as a separate entry in Schedule 1-A of the A.P Stamp Act and hence the department has no authorization to levy stamp duty on License agreement. There was no further demand or any response from the Collector and District Registrar.

Litigation by VSPL

Civil Proceedings

1. VSPL had filed an application before the Principal District Judge, Visakhapatnam to set aside an order of the arbitral tribunal dated December 1, 2009 in favour of VPT. The dispute is regarding the ‘scale of rates’ for payment of royalty by VSPL to VPT. From the commencement of operations till June, 2008 VSPL paid royalty to VPT at the rate of 17.111%. However, a revised ‘scale of rates’ was fixed for VSPL by Tariff Authority for Major Ports (TAMP) on March 31, 2005. VPT has demanded royalty for the entire period at the new ‘scale of rates’. VSPL has disputed the applicability of the new ‘scale of rates’. The arbitral tribunal decided the matter in favour of VPT and ordered VSPL to pay the sum of ₹98.90 lakhs to VPT with interest at 12% per annum. Also, since the date of the order of the arbitral tribunal VSPL has been paying royalty at the revised ‘scale of rates’. The total amount involved in the matter is ₹ 98.90 lakhs. The matter is still pending in the District Court at Visakhapatnam.

2. VSPL had filed a writ petition before the Andhra Pradesh High Court against a demand notice dated February 18, 2011 received from the Regional Transport Authority (“RTA”) of Andhra Pradesh seeking recovery of lifetime road tax on the three ‘harbour mobile cranes’ (“HMC”) being employed by VSPL at its berths. RTA has classified the HMCs as motor vehicles and has therefore levied lifetime tax on them. The Andhra Pradesh High Court has passed an order dated March 30, 2011 staying any punitive action by the RTA. The Andhra Pradesh High Court has directed VSPL to make a written representation in the matter to the RTA commissioner within 15 days of the order and has directed the RTA commissioner to pass an order on the same within six weeks. VSPL has submitted written representation to the RTA Commissioner on April13, 2011. So far, the RTA Commissioner has not passed any order even though the prescribed time given by the Andhra Pradesh High Court has already expired. The total amount involved in the matter is estimated at ₹ 215.00 lakhs.

3. VSPL had initiated arbitration proceedings on January 7, 2011 against the Steel Authority of India Limited (“SAIL”), before an arbitral tribunal comprising 3 arbitrators, disputing certain deductions, amounting to approximately ₹ 153.10 lakhs made by SAIL from certain bills raised by VSPL. SAIL has allegedly made deductions on account of demurrage for pre-berthing delays, shortfall in discharge rate of cargo and under-loading of rakes. VSPL has contended that SAIL has misinterpreted the contractual provisions and cannot deduct those amounts. The arbitration proceedings were completed on July 15, 2012 at Kolkata and the award was received from Indian Council of Arbitration on December 26, 2012. The award was passed in favour of VSPL for a sum of ₹ 153.12 lakhs with 6 %

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interest from the date of the award. Subsequently, SAIL filed a petition No.237 of 2013 in Kolkata high Court for setting aside the award under Section 34 of the Arbitration and Conciliation Act, 1956. The case was heard on March 11, 2013 and the stay order sought by SAIL was not granted and four weeks’ time was given to VSPL to file its Affidavit in opposition. Accordingly, VSPL has affirmed its affidavit in opposition on April 8, 2013. The case is coming in the list of high court of Kolkata every month for hearing. But the case is yet to be heard.

4. TAMP passed an order on October 11,2011under the Major Port Trust Act, revising the tariff of various items of service done by VSPL for a period from December 23, 2011 to March 31, 2014. This order while retaining the existing tariff on all items of revenue except the hire charges collected for use of HMC. The tariff was reduced by 50 % of existing tariff from ₹72.75 per ton to ₹36.60 per ton for this item. Aggrieved by this order, VSPL filed a writ petition no. 33402 of 2011 in the Andhra Pradesh High Court against the tariff order of TAMP dated October 11, 2011 seeking an injunction against the implementation of the order with respect to hire charges collected for HMC. The high court granted stay accordingly and ordered that VSPL can continue to collect ₹72.75 per ton. However, for all transactions done after December 23, 2011 for collecting hire charges above ₹36.70 per ton, a separate account shall be maintained until further orders. TAMP, filed their counter statement on February 23, 2012. The case is yet to be listed for hearing.

5. VSPL disputed a claim of payment of cost recovery charges of ₹137.77 lakhs demanded by the Commissioner of Customs on the ground that it is violative of section 45 of the Customs Act and the rules framed in this regard are ultravires of the Constitution as the customs staff are performing only their sovereign function of collecting customs duty in our terminal. Accordingly, VSPL filed the subject writ petition no.14346/2014 on May 8, 2014 before the Andhra Pradesh high court. The high court passed an order on May 8, 2014 granting interim stay of the said demand of the customs department till disposal of the writ petition subject to the condition that VSPL shall pay 50% of the demand amount claimed by customs within four weeks. Accordingly, 50 % of the demand claimed has been remitted to the customs department. The case is yet to be posted for further hearing.

Arbitration Proceedings

1. Steel Authority of India Limited (“SAIL”) entered into a short term agreement dated May 06, 2008 with VSPL. As per clause 5.12 of the short term agreement VSPL had to provide storage space for storage of cargo volume up to 60,000 metric tonnes and only in exigencies, VSPL had to accommodate another 30,000 metric tonnes and this additional stacking could be for a period of 15 days only. SAIL started stacking cargo of above 60,000 metric tonnes on regular basis. VSPL claimed the storage charges for the excess volume and period of cargo stacked. VSPL sent a legal notice to SAIL for payment of the said storage charges. SAIL did not agree to our contention and failed to pay the due amount of storage charges to VSPL. A dispute arose under clause 5.12 of the short term agreement for non-payment of storage charges payable by SAIL to VSPL for stocking of cargo beyond the free period allowed under the short term agreement. The claim amount involved is ₹3,083.07 lakhs up to March 31, 2012.

VSPL invoked the arbitration clause and sent an arbitration notice to SAIL on July 18, 2012 but there was no response. As per the dispute clause of the short term agreement dated May 06, 2008 entered into with SAIL, a claim statement was sent to Indian Council of Arbitration, New Delhi for taking further action. SAIL nominated retired Ms. Justice Usha Mehra as its arbitrator and we have nominated retired Justice T.Ch. Surya Rao as our nominee arbitrator. SAIL raised the jurisdiction issue of Indian Council of Arbitration stating that this issue shall be dealt by TAMP. We countered the same filing in our counter to the Indian Council of Arbitration (“ICA”) stating that TAMP is a tariff setting authority and not a jurisdictional authority to settle the disputes between parties. Copies of relevant orders of TAMP wherein TAMP has refused to entertain applications for settlement of disputes between parties have also been submitted to ICA. ICA arbitration committee appointed retired Mr. Justice Narayan Chandra Sil as presiding arbitrator. ICA forwarded VSPL’s claim statement and other related correspondence to the arbitral tribunal vide their letter dated October 17, 2013. VSPL also forwarded the correspondence exchanged between ICA, SAIL, TAMP and VSPL to the arbitral tribunal on October 25, 2013, after submission of claim statement to ICA. The first hearing was held on December 21, 2013 at Kolkata.

SAIL filed a petition under section 16 of the Indian Arbitration and Conciliation Act, 1996, on December 21, 2013 during the first hearing representing that the matter is to be decided by the TAMP

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and the arbitral tribunal does not have any jurisdiction over the issue to be decided. After discussing the matter along with learned co-arbitrators, the VSPL was given two weeks’ time to file reply to the said petition and the respondent was given another two weeks’ time to file rejoinder. As directed by the arbitral tribunal we filed our counter affidavit to SAIL on January 04, 2014 with copies to the tribunal.

Subsequently, the matter was taken up by the arbitral tribunal on February 08, 2014 at Kolkata and heard the arguments of both the advocates of SAIL and VSPL. After hearing the arguments of both sides, the arbitral tribunal held that as the claim of VSPL is based on breach of contract , the question of breach of contract cannot be decided by the TAMP. Therefore, application filed by SAIL under Section 16 of Arbitration and Conciliation Act stands rejected. SAIL was directed to file the statement of defense and counter claim if any, within six weeks with the advance copy to the counsel of the claimant and the claimant may file the rejoinder and reply if any to the counter claim within six weeks. SAIL filed its Statement of defense on March 28, 2014 and VSPL filed its rejoinder on April 25, 2014 and subsequent hearing was held at Kolkata on May 03, 2014.Further hearing has been fixed at Vizag on August 23 and August 24, 2014 for arguments of the claimant.

Tax Proceedings

1. VSPL filed an appeal on January 29, 2011 before the Commissioner of Income-Tax (Appeals) against the order of the Deputy Commissioner of Income Tax, circle 7(3), Mumbai, dated December 31, 2010 for the assessment year 2008-09, disallowing deduction of ₹ 1.26 lakhs towards delayed deposit of provident fund contribution, ₹ 13.17 lakhs towards fees for increase in authorized share capital and ₹1,655.47 lakhs towards disallowance of depreciation on project berths on the ground that VSPL is not the legal owner. Commissioner of Income-tax (Appeals) has passed order allowing our claim of depreciation on Project Berths.

2. VSPL filed an appeal on January 29, 2011 before the Commissioner of Income-Tax (Appeals)-13, against certain orders of the Deputy Commissioner of Income Tax, Circle 7(3), Mumbai, for Assessment Year 2005-2006. VSPL has challenged the order dated December 24, 2007 under section 143 (3) of the Income Tax Act, 1961for Assessment Year 2005-2006, disallowing certain deductions in relation to expenses incurred on increase in authorized share capital, liquidated damages, prior period expenses, capital expenditure and delayed deposit of provident fund contribution. The appeal was allowed in favour of VSPL except upholding of the disallowance of expenditure on increase in authorised capital. Also, VSPL challenged the order dated December 31, 2010 under section 147 (3) of the IT Act disallowing deprecation of ₹ 817.74 lakhs on project berth. Commissioner of Income-tax (Appeals) passed order allowing our claim of depreciation on project berths.

3. VSPL filed an appeal on February 3, 2012 before the Commissioner of Income-Tax (Appeals)-13, against certain orders of the Deputy Commissioner of Income Tax, Circle 7(3), Mumbai, for the Assessment Year 2009-10. VSPL filed an appeal against the order of the Deputy Commisssioner for A.Y 2009-10 under section 143(3) of the Income Tax Act. The assessing officer disallowed certain deductions in relation to miscellaneous expenses amounting to ₹ 13.17 lakhs written off under section 35D of the Income Tax Act.

Litigation by AIIPL

1. On the recommendation of the Standing Linkage Committee (SLC), Western Coalfield Limited (WCL), vide its communication dated July 16-17, 2010, WCL issued a letter of assurance (LOA) to Aparna Infraenergy, a partnership firm for coal linkage. On receipt of the LOA, AIIPL initiated the process of complying with the various terms and conditions of the LOA and from time to time submitted the requisite report with respect to the compliances and also provided bank guarantees, as required.

On December 7, 2013, AIIPL received a communication form WCL whereby they raised certain objections in relation to the documents submitted with respect to conversion of Aparna Infraenergy (partnership firm) to AIIPL (a company). AIIPL issued a communication dated January 6, 2014 to WCL pointing out that the stand taken and the conclusion arrived at by the WCL in its communication dated December 7, 2013 about the alleged assignment was incorrect. On February 11, 2014 a meeting took place between the representative of AIIPL and the legal cell of WCL, regarding the issue raised by WCL vide its communication. In the said meeting, AIIPL’s representatives again pointed out the

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factual position in detail. AIIPL vide its communication dated May 6, 2014 pointed out to SLC that it had completed all of its milestones and was very serious and sincere in developing the 1X250 MW thermal power plants and had taken all the requisite preparatory action for the same. AIIPL had therefore, requested SLC to expedite the process of execution of the fuel supply agreement (FSA) in favour of AIIPL.

A meeting of AIIPL, SLC and WCL took place on June 27, 2014 in order to consider the objections of WCL. AIIPL was expecting a positive outcome from the meeting before SLC. However, SLC had different views, which is evidenced by the minutes of the meeting dated June 27, 2014 and the covering letter dated July 24, 2014 uploaded on the website of Ministry of Coal, accessed by AIIPL.

Apprehending coercive action by WCL/SLC, AIIPL approached the High Court of Judicature, at

Nagpur. The High Court in its order dated August 8, 2014 has directed WCL and other respondents not to take any coercive steps against AIIPL.

In addition to the above matters, we are also involved in certain administrative, quasi judicial and legal proceedings pending before the relevant courts, forums and authorities at various levels with respect to our other business, which include, inter alia disputes relating to direct and indirect tax liabilities, section 138 of the Negotiable Instruments Act, 1881, criminal breach of trust and cheating, trespassing, tariffs charged, contravention of Building and Other Construction Workers Regulation of Employment and Conditions of Service Act, 1996,contract labourers, health hazard, eviction, illegal construction, environmental law issues, undertaking construction work or operation without obtaining prior approval, approvals granted by various authorities, ownership and/or acquisition of the land, nuisance, payments due under certain commercial contracts and non-payment of outstanding dues, other regulatory boards and commissions, consumer disputes, accident claims, labour disputes, and such other similar matters. We cannot predict the initiation of any future litigation and / or the outcome of any pending or future litigation, examination or investigation, based on the amounts sought in pending actions against us and our history of resolving litigation matters in the past, as well as the advice of legal counsel.

Inquiries, inspections or investigations under Companies Act

There are no inquiries, inspections or investigations initiated or conducted against our Company and our Subsidiaries under the Companies Act, 2013 or any previous company law in the last three years. Further, there are no prosecutions filed (whether pending or not), fines imposed, compounding of offences in the last three years involving our Company and our Subsidiaries.

Material Frauds

There are no material frauds committed against our Company during the last three years.

Defaults in respect of dues payable:

Except as stated in the table below, our Company has no outstanding defaults in relation to statutory dues payable, dues payable to holders of any debentures (including interest thereon) or dues in respect of deposits (including interest thereon) or any defaults in repayment of loans from any bank or financial institution (including interest thereon).

Defaults in repayment of loans from any bank or financial institution

Event Amount Duration Details of Defaults Interest overdue/ Stake Sale in MNEL

₹478.00 lakhs (The amount excludes penal interest & other additional interest charged on the overdue amount)

June 15 2014 to July 16, 2014

In relation to the rupee loan agreement dated September 27, 2012 entered into between our Company and IDFC Limited, our Company has failed to make interest payment due on June 14 and July 14, 2014. However, the non-compliance was cured on July 17, 2014. In accordance with the provisions of the loan agreement, in case (a) our Company commits two consecutive defaults in payment of interest due and / or a default in repayment of the loan; and/or (b) our Company has not entered into a binding MNEL Stake Sale Agreement by March 31, 2014, then the lender shall have the right, at its sole discretion, to refinance the existing debt on the books of MNEL and all cost and expenses, prepayment premiums shall be on the account of our Company and MNEL.

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Event Amount Duration Details of Defaults The loan agreement also requires that our Company (i) shall enter into binding agreement with respect to sale of shares of MNEL (“MNEL Stake Sale”) with the selected buyer by March 31, 2014 (“MNEL Stake Sale Agreement”) and during March – August 2014, it shall apply for necessary approvals and also take necessary corporate action for consummating the said transaction. It shall procure requisite approvals from NHAI, its joint venture partner in MNEL and existing lenders of MNEL for the same on or before August 31, 2014. Our Company has defaulted on the aforesaid covenant.

Cross Default

₹ 478.00 lakhs

June 15 2014 to July 16, 2014

In relation to the facility agreement dated March 4, 2014 entered into between our Company and Avanti Traders Private Limited, our Company failed to make interest payment for two months to IDFC Limited which led to cross default under this agreement. But the overdue interest was paid to the lender and the default was cured on July 17, 2014, hence, the cross default under this agreement has been automatically cured. In accordance with the requirements of the loan agreement there occurs a cross default if any financial indebtedness of the Company is not paid when due and the same is not disputed by the Company acting in good faith.

Payment Overdue for equity and premium

₹ 1,333.61 lakhs (excluding penal interest)

March 2014 till August 2014 (for equity) May 10 2014 to August 10, 2014 (for premium)

Our Company has failed to make payments towards principal towards equity amounts from March 2014 till August 2014 (on a monthly basis) and towards premium amount from May 2014 till August 2014 (on a monthly basis) in accordance with the Supplementary Buy Back agreement. For further details refer to ‘Business’ on page 127.

Litigation or legal action against Promoters taken by any Ministry, Department of Government or any statutory authority

Litigation involving GIL

Criminal Proceedings against GIL

1. The Inspector of Factory Thiruvattriyour has filed a Complaint, Nos. 901, 902 and 903 against GIL, before the Judicial Magistrate of Ponneri with respect to a fatal accident which took place at GIL’s site at NTPC Vallur. The Complaints were quashed by the High Court of Chennai vide order dated June 28, 2013 in WP Numbers 31723-31725 of 2012. Final order from the Judicial Magistrate of Ponneri in compliance with the quashing order of the High Court is awaited.

2. A Criminal Complaint Nos. 108 of 2012 has been filed against GIL, the Chairman and Managing Director of GIL and the Project Incharge by the Inspector of Factories, Rajamundry, in the Court of Additional Judicial Magistrate, Rajamundry for alleged violation of the provisions of Building and Other Construction Workers Act, 1996. A stay has been granted by the Andhra Pradesh High Court through its order dated September 11, 2012. The matter is pending.

3. A complaint has been filed by the Deputy Directorate Office (Industrial and Health) against the

Chairman and Managing Director of GIL and others for alleged violations of the provisions of the Building and Other Construction Workers Act, 1996. The Chief Judicial Magistrate, Singrauli has dismissed the complaint on June 26, 2013, the order is thereby awaited.

4. The Inspector of Factory has filed criminal complaints against TNVS Ratnajit and Chairman and

Managing Director of GIL in the Court of 2nd Additional Judicial 1st Class Magistrate, Kovvru for alleged violations of the Factories Act, 1948 at GIL’s site at Rajamundry. As per order dated February 28, 2013 in WP No. 5547/2013, proceedings have been stayed until further orders. The matter is currently pending.

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Labour Proceedings against GIL (Criminal)

1. The Labour Inspector, Sidhi had moved a complaint before the Labour Court against GIL for alleged non-payment of minimum wages to the tune of ₹ 3.64 lakhs and penalty of ₹ 36.45 lakhs at Vindyhachal site. GIL has objected to the jurisdiction and powers of Labour Inspector to file the present suit. The next date of hearing is on July 22, 2014 in the Labour Court, Sidhi, Madhya Pradesh.

2. The Labour Enforcement Officer (Central), Nagpur had issued a Charge sheet against GIL and Mr. HM Joshi for alleged violations of the Provisions of Building and Other Construction Workers Act, 1996. The next date of hearing of the case is on July 22, 2014 in the Court of Judicial Magistrate First Class, Wardha.

3. The Labour Enforcement Officer (Central), Bhusaval had issued a Charge sheet against GIL and others

for alleged violations of the Provisions of Building and Other Construction Workers Act, 1996. The next date of hearing is awaited and the case is set for service of summons in the Court of Judicial Magistrate First Class, Akola.

4. The Labour Enforcement Officer (Central), Titlagarh had issued a Charge sheet against Mr. D.C. Bagde

and GIL for alleged violations of the Provisions of the Contract Labour (Regulation and Abolition) Act, 1970. GIL pleaded guilty in the matter and the case was settled on April 7, 2013 in the Court of Sub Divisional Judicial Magistrate, Balangir (Orissa).

5. The Labour Enforcement Officer (Central), Jabalpur had issued a Charge sheet against Mr. Ramanuj Rao

and GIL for alleged violations of the Provisions of Building and Other Construction Workers Act, 1996. We pleaded guilty and the matter was decided on June 13, 2014 in the Court of Chief Judicial Magistrate, Dindori (MP).

6. The Labour Enforcement Officer (Central), Nagpur had issued a Charge sheet against Mr. H.M. Joshi

and GIL for alleged violations of the Provisions of Contract Labour (Regulation and Abolition) Act, 1970. GIL pleaded as guilty and the matter was settled on September 7, 2013 in the court of Judicial Magistrate First Class, Bhiwapur.

7. The Labour Enforcement Officer (Central), Raipur had issued a Charge sheet against Mr. D.C. Bagde,

Mr. H.M. Joshi and GIL for alleged violations of the Provisions of Contract Labour (Regulation and Abolition) Act, 1970. GIL pleaded as guilty and the matter was settled on June 20, 2014 in the court of Judicial Magistrate First Class, Raigarh (CG).

8. The Labour Enforcement Officer (Central), Nagpur had issued a Charge sheet against Mr. H.M. Joshi and GIL for alleged violations of the Provisions of Contract Labour (Regulation and Abolition) Act, 1970. GIL pleaded as guilty and the matter was settled on April 4, 2013 in the court of Judicial Magistrate First Class, Wardha.

Labour Proceedings against GIL (Civil) 1. A complaint has been filed by the Employee’s State Insurance Corporation against GIL’s Ex Managing

Director, late Dr. TN Subba Rao and the then Chairman, late Mr. James Bates for alleged non-implementation of Employee’s State Insurance Scheme in GIL. The matter is pending in the 25th Court of the Metropolitan Magistrate, Mazagaon, Mumbai. The next hearing is on September 24, 2014.

2. The United India Insurance Company has challenged a compensation amount to a worker at the Srisailam

Left Bank Canal Site in FAO 324/05. The matter is currently not on board and is pending.

3. A process order has been issued against GIL site incharge under the Factories Act, 1948 and the Andhra Pradesh Factory Rules, 1050. The matter is pending in Magistrate’s Court, Rajamundry. The last date of hearing was July 14, 2014, the matter is currently pending in view of stay granted by HC Andhra.

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4. A complaint has been filed by The Labour Enforcement Authority under the Minimum Wages Act, 1948 with the Authority under the Minimum Wages Act, Chennai under the claim application 423 to 428. The matter has been settled, the order copies are awaited.

5. The Maharashtra Kamgar Ekjut Union has filed a complaint on the behalf of the employees of GIL’s sub-

contractors under the MRTU and the PULP Act, in the Industrial Court, Mumbai. The matter is currently pending and the next date of hearing is on September 14, 2014.

6. An enquiry under Section 7A of the Employees’ Provident Fund Act, pertaining to Agra Road Works has been initiated by the Assistant Provident Fund Commissioner, Agra. The matter is currently pending and the next date of hearing is on August 29, 2014.

Labour Proceedings by GIL

1. GIL has filed a case Misc. Case No. 1/2009 in the Employee’s State Insurance Court, Cuttack challenging the applicability of Employee’s State Insurance Act, 1948 at GIL’s Jindal site. The matter is currently pending.

2. GIL has filed a Writ Petition 28843 of 2011, challenging the Order of levy of 1% cess under the Buildings and Other Construction Workers Welfare Cess Act, 1996 before the High Court of Andhra Pradesh at Hyderabad. The matter has been admitted and is currently pending.

3. GIL has filed writ petitions WP No. 28284 of 2012 (CC 597 of 2010) and WP 28285 of 2012 (CC 598 of

2012) against a process order that was issued against GIL’s site incharge in Rajamundry, in the High Court of Andhra Pradesh. The matter is currently not on board and is pending.

4. GIL has challenged an order of Regional Provident Fund Commissioner, Bhubaneshwar in 7A enquiry

before the Employees’ Provident Fund Appellate Tribunal, New Delhi under the Employees’ Provident Fund Act. The matter is up for hearing on December 24, 2014.

5. A worker of the Bombay Security Services, Kanpur has challenged the order of the Regional Labour

Commissioner before the High Court, Allahabad through a writ petition WP 52891 of 2012. The status of the case is awaited.

6. GIL has filed case against ESIC in HC Mumbai, challenging applicability of ESI Act to Head Office and

challenging recovery proceedings adopted by the ESIC. Matter has been admitted with a stay on recovery proceedings. The Case will come up for hearing in due course.

Tax Proceedings against GIL

1. The Department of Service Tax, Maharashtra has imposed an additional liability in considering “works contract service” under the category of “Erection, Commissioning or Installation” with the disputed dues of up to ₹594.64 lakhs for the period of April 1, 2008 – January 31, 2009, ₹476.69 lakhs for the period of February 1, 2009 – September 30, 2009, ₹ 653.28 lakhs for the period of October 1, 2009 – March 31, 2010, ₹ 718.43 lakhs for the period of April 1, 2010 – March 31, 2011 and ₹. 422.94 lakhs for the period of April 1, 2011 – March 31, 2012 with the equivalent amount of penalty thereon in the matter before CESTAT, Western Region, Mumbai a stay has been granted and the appeal of GIL has been allowed in the final hearing held on June 27, 2014.

2. The Department of Service Tax, Maharashtra has imposed a penalty for short payment against “Business Auxiliary Service” to the amount of ₹16.91 lakhs for the assessment year 2009-10. The CESTAT, Western Region, Mumbai has heard the stay petition and granted it without any part payment. The next hearing date is awaited.

3. The Department of Service Tax, Gujarat has imposed an additional service tax liability due to

disallowance of CENVAT credit with a final liability of ₹ 9.21 lakhs in the assessment year 2006-07. The matter is pending in CESTAT, Western Region, Ahmedabad. The stay petition has been heard and a stay has been granted against part payment. The next hearing date is awaited.

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4. The Department of Service Tax, Gujarat has imposed a disallowance of Service Tax CENVAT Credit on

CHA invoices for the assessment year 2009-10, with a final liability of ₹ 1.61 lakhs. The appeal has been allowed by the Commissioner of Appeals through order dated April 08, 2014.

5. The Department of Central Excise, Maharashtra has imposed interest on duty paid on price escalation

billing upto ₹ 4.37 lakhs for the period of July 1, 2006 – October 31, 2007. The amount has been paid by GIL. The High Court has rejected GIL’s claim by its order dated June 14, 2013. No further appeal has been filed.

6. The Department of Central Excise, Maharashtra has imposed interest on duty paid on price escalation

billing upto ₹ 2.32 lakhs for the period of November 1, 2007 – December 31, 2008, ₹ 3.73 lakhs for the period of January 1, 2009 – December 31, 2009, ₹ 21.75 lakhs for the period of January 1, 2010 – March 31, 2011, ₹ 14.85 lakhs for the period of April 1, 2011 – June 30, 2012 and ₹ 18.00 lakhs for the period of July 1, 2012 – June 30, 2013. The matters are pending in CESTAT, Western Region, Mumbai. The amount has already been paid under protest by GIL and the matters are in appeal.

7. The Department of Central Excise, Gujarat has demanded an interest on duty paid for price escalation

billing of ₹ 17.91 lakhs for the period of February 2010 – December 2011. The amount has been paid by GIL under protest and an appeal filed before the Commissioner of Appeals by GIL was also dismissed. No further appeal has been filed.

8. The Department of Excise Tax, Maharashtra Deoli has imposed interest on duty paid on price escalation

billing upto ₹. 2.32 lakhs for the period of 2011-2012 up to May 2013. The amount has been paid by GIL under protest and an appeal has been filed with the Commissioner of Appeals on February 19, 2014.

9. The Department of VAT, Gujarat has imposed a disallowance of Input Tax Credit on purchases made

from Prakash Re-Rollers Limited, on the basis of the findings of Directorate General of Central Excise Intelligence with a tax and penalty of ₹ 10.74 lakhs for the assessment year 2007-08, ₹ 51.48 lakhs for the assessment year of 2008-09, ₹ 10.27 lakhs for the period of April 1, 2009 – June 30, 2009, ₹ 20.12 lakhs for the period of July 1, 2009 to March 31, 2010. Out of the above demands, demand for year 2008-09 and demand for the period April 1, 2009 to June 30, 2009and July 1, 2009 to March 2010 was fully paid under protest. The Deputy Commissioner of Commercial Taxes, Baroda has dismissed our first appeal. A second appeal has been filed with the Gujarat VAT Tribunal, Ahmedabad. The date of hearing is awaited.

10. The Department of VAT and CST has rejected the CST forms, disallowed input tax credit and export

claim and charges an interest and penalty of up to ₹ 37.31 lakhs for a period of 2007-08. Out of this demand ₹ 7.1 lakhs has been paid under protest. The matter is pending in the Gujarat VAT Tribunal. Next date of hearing is awaited.

11. The Department of CST, Gujarat has disallowed a claim of direct exports and deemed export against

Form H and has levied interest and a penalty of up to ₹ 693.70 lakhs for the period of 2008-09. Out of this demand ₹ 70.00 lakhs has been paid under protest. The matter is pending the Gujarat VAT Tribunal and the hearing date is awaited.

12. The Department of CST, Maharashtra has disallowed a claim of branch transfer on technical grounds in

Form F and also disallowed a claim of sale in transit on the basis of pre determined sale with a disputed amount of ₹ 266.12 lakhs for the period of April 1, 2008 – March 31, 2009. Out of this demand ₹ 7.04 lakhs has been paid under protest. An appeal has been filed by GIL with the Joint Commissioner of MVAT, Nagpur and the matter is in progress.

13. The Department of CST, Maharashtra has disallowed a claim of sale in transit and an input tax credit

with a disputed amount of ₹ 935.97 lakhs for the period of April 1, 2005 – March 31, 2006. Out of this demand ₹ 15.00 lakhs has been paid under protest. An appeal has been filed by GIL with Deputy Commissioner MVAT, Nagpur and the matter is in progress.

14. The Joint Commissioner of Sales Tax, Aligarh (Silvassa) has imposed a penalty due to a missing date on

waybill with dues of up to ₹13.80 lakhs for the period of June 2013. Out of this demand ₹ 5.18 lakhs has

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been paid under protest. GIL filed an appeal with the Additional Commissioner of Appeals and it was allowed by an order dated June 11, 2014.

15. An additional amount was raised in assessment by the Department of VAT, Madhya Pradesh of up to

₹34.23 lakhs for the period of 2007-08 and ₹ 4.62 lakhs by way of Entry Tax for the period of 2007-08. An appeal was filed before the Deputy Commissioner, Khandwa, MP and it was allowed and the amount paid was refunded to GIL.

16. The Department of VAT, Gujarat has disallowed input tax credit on purchases made from Prakash Re-

Rollers Limited with amount disputed of up to ₹ 10.27 lakhs for the period of April 1, 2009 – June 30, 2009. Appeal has been filed before the Deputy Commissioner of Commercial Tax and the date of hearing is awaited.

17. The Department of CST, Gujarat has imposed an additional liability on non-submission of Form C, for

an amount of ₹ 4.33 lakhs for a period of April 1, 2009 – June 30, 2009. Appeal has been filed before the Deputy Commissioner of Commercial Tax and the date of hearing is awaited.

18. For GIL’s projects in Rajahmundry / Vizag, the taxation authority has levied tax on value of materials at

the time of incorporation, instead of on the purchase price of the materials for the assessment year of 2002-03. As far as SLBC is concerned, authority has computed taxability on 30:70 basis under Rule 6(3)(ii) instead of 6(3)(i). Assessment order received on May 16, 2007 with a refund of ₹ 259.00 lakhs. A Revision show cause notice was received from Additional Commissioner and objections were filed. The revision order was passed on January 29, 2008 against which a writ has been filed by GIL. The Matter was heard on January 27, 2008 wherein an ad interim stay has been granted against the pre deposit of 50% before March 31, 2008. A miscellaneous petition was filed with regard to payments already made and the matter has been posted for hearing on April 22, 2008. The Order is awaited with regard to adjustment to be made for payments made earlier from the Tribunal.

19. For GIL’s projects in Rajahmundry / Vizag, the taxation authority has levied tax on value of materials at

the time of incorporation, instead of on the purchase price of the materials for the assessment year of 2003-04. As far as SLBC is concerned, authority has computed taxability on 30:70 basis under Rule 6(3)(ii) instead of 6(3)(i). The assessment order was received on June 16, 2007 with a refund of ₹144.00 lakhs. A revision show cause notice was received from Additional Commissioner and objections were filed. A revision order was passed on January 29, 2008 against which writ was filed before Andhra Pradesh High Court. The matter was heard on January 27, 2008 wherein an ad interim stay has been granted against pre deposit of 50% before March 31, 2008. A miscellaneous petition was filed with regard to amounts already paid & matter was posted for hearing on April 22, 2008. Payments made earlier have been considered against 50%. The order is awaited from the Tribunal.

20. A disallowance was made and a penalty was filed for the inter-state purchases made for the Kalwakurthy

Irrigation Project of GIL for the period of 2005 - November 2007. GIL filed a writ petition contesting the disallowance of exemption claim. The exemption is based on rule 4(7)E of Andhra Pradesh VAT Act. The writ stands admitted in the High Court & final hearing is awaited.

21. An Entry tax was imposed for a wrong waybill used for dispatching materials by GIL at a site in Sasan

for the period of 2009-10 and 2010-11. An appeal has been filed with the Deputy Commissioner of Appeals and also pending at Audit.

22. The Department of Service Tax had issued a Show Cause Notices, dated March 24, 2009, December 21,

2009 and September 28, 2010 to GIL directing GIL to pay taxes under the category of “Erection, Commissioning and Installation” in view of the terms of the Letter of Intent of the construction and refusing the benefit of abetment for GIL’s site at Bhilai (Cooling Tower). The Department computed the tax liability @12.24% on civil work billing amount to ₹.140.32 lacs for the period of July 1, 2006 – May 10, 2007, May 11, 2005 – November 30, 2008, December 1, 2008 – September 30, 2009 and October 1, 2009 – March 31, 2010. Subsequent to this Orders dated December 12, 2011 and March 28, 2012 were passed by the Commissioner of Central Excise, Thane and Comm(TAR) Mumbai,, imposing tax and a penalty on GIL. Against these orders an appeal was filed by GIL before the Customs Excise and Service Tax Appellate Tribunal, on the grounds that it is not engaged in providing “Erection, Commissioning & Installation Services", and that it is entitled to the benefit of abatement and that the

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value of "Client Supplied FOC Material" does not form part of the head of "Value of Taxable Service”. The matter was decided in the favour of GIL through an order of CESTAT dated, July 2, 2014.

23. The Department of Service Tax had issued a Show Cause Notice dated April 21, 2010, to GIL refusing the benefit of abatement for GIL, the Department computed the tax liability @12.24% or 12.36% on civil work billing amount of ₹1,20,119.00 lakhs and computed the liability of ₹.139.26 lacs out of which liability of ₹ 4,605.00 lakhs was already discharged by GIL before issuance of SCN. Subsequent to this an order dated March 29, 2012 was passed by the Commissioner (TAR) Mumbai, imposing tax and a penalty on GIL. Against this order an appeal was filed before the Customs Excise and Service Tax Appellate Tribunal, on the grounds that the denial of benefit of abetment is untenable in law, that no material has been supplied free of cost by the client in cases of 18 projects covered by the notice, that in respect of four projects, the demand has been raised twice, that GIL entitles the input credit of duty paid on inputs, and that no penalty or interest can be imposed on GIL. An order was issued on July 2, 2014 deciding the matter in favour of GIL.

24. The Department of Service Tax had issued a Show Cause Notice, dated September 7, 2009, to GIL refusing the benefit of abetment for GIL’s site at Bangalore (Godrej Woodsman Estate), the Department computed the tax liability @12.24% or 12.36% on 33% value of the materials issued by the client at free of cost amounting to ₹6,326.00 lakhs to be paid by GIL for a period of Jan 1, 2006 – March 31, 2009. Subsequent to this an order dated December 9, 2011 was passed by the Commissioner of Central Excise, Thane-I, imposing tax and a penalty on GIL. Against this order an appeal was filed before the Customs Excise and Service Tax Appellate Tribunal, on the grounds that the denial of benefit of abetment is untenable in law, that the value of free of cost material supplied by client did not form part of taxable income and that the interest and penalty are not payable by GIL. An order was issued on July 2, 2014 deciding the matter in favour of GIL.

25. The Department of Service Tax had issued a Show Cause Notice, dated February 15, 2007, to GIL

refusing the benefit of abatement for GIL’s site at NTPC, claiming that GIL has not discharged service tax obligation on 33% of value of Material Supplied hence computing the tax liability of ₹ 128.62 lakhs @10.20% and 12.24% on the value of services of ₹1,216.24 lakhs without the benefit of abatement to be paid by GIL for a period of September 10, 2004 – November 30, 2006 out of which GIL has already discharged a liability of ₹ 44.49 lakhs after availing 67% abatement and before issuance of SCN. Subsequent to this an order dated February 15, 2010 was passed, imposing tax and a penalty on GIL. Against this order an appeal was filed before the Customs Excise and Service Tax Appellate Tribunal, on the grounds that the denial of benefit of abetment is untenable in law that the interest and penalty are not payable and that service provided by GIL does not come under the taxable services category. An order was issued on July 2, 2014 deciding the matter in favour of GIL.

26. The Department of Service Tax had issued a Show Cause Notice, dated February 27, 2008, to GIL refusing the benefit of abatement for GIL’s site at NTPC, claiming that the company has not discharged service tax on 33% of Value of Material Supplied hence computing the tax liability of ₹ 5611263 @ 10.20% or 12.24% on the value of services of ₹ 513.47 lakhs without the benefit of abatement to be paid by GIL for a period of December, 2006 to 31 July, 2007 out of which we had already discharged liability of ₹ 21.73 lakhs after availing 67% abatement and before issuance of SCN. Subsequent to this an order dated October 27, 2011 was passed, imposing tax & penalty on GIL. Against this order an appeal was filed before the Customs Excise and Service Tax Appellate Tribunal, on the grounds that the denial of benefit of abetment is untenable in law that the interest and penalty are not payable and that service provided by GIL does not come under the taxable services category. An order was issued on July 2, 2014 deciding the matter in favor of GIL.

27. The Department of Service Tax had issued a Show Cause Notice, dated August 31, 2009, to GIL

imposing additional Service tax liability by including the value of material supplied free of cost by the client at GIL’s site at New India Hotel Bangalore, computing the tax liability of ₹25.14 lakhs @ 12.24% & 12.36% on 33% value of the free of cost materials issued by the client, on the value of ₹ 620.21 lakhs for a period from July 1, 2006 to December 31, 2007. Reply to SCN has been filed on November 10, 2009, last hearing occurred on March 7, 2012 and written submissions filled on March 19, 2012. Order is awaited.

28. The Department of Service Tax had issued a Show Cause Notice, dated December 29, 2006, to GIL

imposing Service tax liability on Construction Of Diaphragm Wall & Anchor Slab Across at Sabarmati

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River, Gujarat, under category “Site Formation and Clearance ,Excavation & Earthmoving & Demolition Service” computing the tax liability of ₹ 266.17 lakhs @ 10.20% and 12.24% on entire value of the Service provided to the client on the value of services of ₹ 2,446.49 lakhs for a period from June 16, 2005 to August 31, 2006. Subsequent to this an order dated January 5, 2010 was passed, imposing tax and penalty on GIL. Against this order an appeal was filed before the Customs Excise and Service Tax Appellate Tribunal, on the grounds that the services provided by GIL are specifically excluded from the definition of “Site Formation and Clearance, Excavation & Earthmoving & Demolition Service”, and that the interest and penalty are not payable and that service provided by GIL does not come under the taxable services category. An order was issued on July 22, 2014 deciding the matter in favor of GIL.

29. The Department of Service Tax had issued a Show Cause Notice, dated September 30, 2007, to GIL

imposing Service tax liability on Construction Of Diaphragm Wall & Anchor Slab Across at Sabarmati River, Gujarat, under category “Site Formation and Clearance ,Excavation & Earthmoving & Demolition Service” computing the tax liability of ₹ 71.27 lakhs @ 10.20% and 12.24% on entire value of the Service provided to the client on the value of services of ₹ 581.80 lakhs for a period of September 1, 2006 to August 31, 2007. Subsequent to this an order dated October 19, 2011 was passed, imposing tax and penalty on GIL. Against this order an appeal was filed before the Customs Excise and Service Tax Appellate Tribunal, on the grounds that the services provided by GIL are specifically excluded from the definition of “Site Formation and Clearance, Excavation & Earthmoving &Demolition Service”, and that the interest and penalty are not payable and that service provided by GIL does not come under the taxable services category. An order was issued on July 22, 2014 deciding the matter in favor of GIL.

30. The Department of Service Tax had issued a Show Cause Notice, dated October 7, 2008, to GIL

imposing Service tax liability on Construction Of Diaphragm Wall & Anchor Slab Across at Sabarmati River, Gujarat, under category “Site Formation and Clearance, Excavation & Earthmoving &Demolition Service” computing the tax liability of ₹ 87.35 lakhs @ 10.20% and 12.24% on entire value of the Service provided to the client on the value of services of ₹ 706.74 lakhs for a period of September 1, 2007 to June 30, 2008. Reply has been filed on November 14, 2008 and last hearing held on July 3, 2014, order is awaited.

31. The Department of Service Tax had issued a Show Cause Notice, dated August 17, 2009, to GIL

imposing Service tax liability on Construction Of Diaphragm Wall & Anchor Slab Across at Sabarmati River, Gujarat, under category “Site Formation and Clearance, Excavation & Earthmoving &Demolition Service” computing the tax liability of ₹1,35,41,545 @ 10.20% and 12.24% on entire value of the Service provided to the client, on the value of services of ₹ 109559429/- for a period from July 1, 2008 to May 31, 2009. Reply has been filed on August 29, 2009 and last hearing held on July 3, 2014, Order is awaited.

32. The Department of Service Tax had issued a Show Cause Notice, dated September 29, 2009, to GIL

imposing Service tax liability on Construction Of Diaphragm Wall & Anchor Slab Across at Sabarmati River, Gujarat, under category “Site Formation and Clearance, Excavation & Earthmoving & Demolition Service” computing the tax liability of ₹5.18 lakhs @ 10.20% and 12.24% on entire value of the Service provided to the client on the value of services of ₹ 50.27 lakhs for a period from June 1, 2009 to March 31, 2010. Reply has been filed on October 19, 2010 and last hearing held on July 03, 2014. Order is awaited.

33. The Department of Service Tax had issued a Show Cause Notice, dated October 8, 2013, to GIL

imposing Service tax liability on Construction Of Diaphragm Wall & Anchor Slab Across at Sabarmati River, Gujarat, under category “Site Formation and Clearance, Excavation & Earthmoving &Demolition Service” computing the tax liability of ₹ 197.76 lakhs @ 12.36% on entire value of the Service provided to the client on the value of services of ₹ 1,600.00 lakhs for a period from April 1, 2012 to March 31, 2013. Reply to be filed.

34. The Department of Service Tax had issued a Show Cause Notice, dated September 19, 2012, to GIL

imposing Service tax liability on Construction Of Construction of Off-shore Container Terminal - Two Berths are New berths at Mumbai Port and Construction of Bulk Berth at Jaigrah Port, under category “Works Contract Services” computing the total tax liability of ₹2,049.50 lakhs (both ports) on the entire value of the Service provided to the client on the value of services of ₹ 16,291.05 lakhs and ₹ 3,244.83 lakhs respectively for a period of to 16 June, 2009 to February 28, 2011 and February 28, 2008 to

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December 28, 2009, respectively. Subsequent to this an order dated January 5, 2010 was passed, imposing tax and penalty on GIL. Reply was filed by GIL taking submitting that the Port constructed by GIL is a new port and different from the earlier existing ports. A personal hearing was held for both the matters on July 3, 2014. Orders are awaited.

35. The Department of Service Tax had issued a Show Cause Notice, dated September 24, 2008, to GIL

refusing the benefit of abatement for GIL’s site at NTPC, Bilaspur, computing the tax liability of ₹13.62 lakhs @12.24% & 12.36% o on the value of services of ₹ 123.83 lakhs without the benefit of abetment to be paid by GIL for a period of August 1, 2007 to May 31, 2008 if we do not add value of Free Issue Material by the Client and out of GIL has already discharged Service Tax Liability Of ₹5.05 lakhs before issuance of SCN. Reply has been filed on October 6, 2008. Order is awaited.

36. The Department of Service Tax had issued a Show Cause Notice, dated August 17, 2009, to GIL refusing

the benefit of abatement for GIL site at NTPC, computing the tax liability of ₹5.05 lakhs @12.24% & 12.36% on the value of services of ₹ 40.82 lakhs without the benefit of abetment to be paid by GIL for a period of June 1, 2008 to March 31, 2009 if we do not add the value of free issue material and out of GIL has already discharged Service Tax Liability Of ₹1.23 lakhs before issuance of SCN. Reply has been filed on August 29, 2009. Order is awaited.

37. The Department of Service Tax had issued a Show Cause Notice, dated September 28, 2010, to GIL

refusing the benefit of abatement for GIL’s site at NTPC, computing the tax liability of ₹2.44 lakhs @12.24% & 12.36% on value of services of ₹ 19.71 lakhs without the benefit of abetment to be paid by GIL for a period of April 1, 2009 to March 31, 2010 if we do not add the value of free issue material and out of GIL has already discharged Service Tax Liability Of ₹0.80 lakhs before issuance of SCN. Reply has been filed on October 19, 2010. Order is awaited.

38. The Department of Service Tax had issued a Show Cause Notice, dated September 29, 2011, to GIL

refusing the benefit of abatement for GIL’s site at NTPC, computing the tax liability of ₹3.80 lakhs of ₹ @12.24% & 12.36% on value of services of ₹ 3687580/- without the benefit of abetment to be paid by GIL for a period of April 1, 2010 to March 31, 2011 if we do not add the value of free issue material and out of GIL has already discharged Service Tax Liability Of ₹1.25 lakhs before issuance of SCN. Reply has been filed on November 08, 2011. Order is awaited.

39. The Department of Service Tax had issued a Show Cause Notice, dated April 15, 2008, to GIL imposing

Service tax with respect to the Services (Laying, Commissioning Of Water Pipelines & Construction Of Sumps, Pump Houses, in Surendranagar District - Project) provided to the Client i.e. Gujarat Water Supply and Sewerage Board claiming that the end user of the said Project developed pursuant to the Services provided by GIL were Industries also, thereby computing the tax liability of ₹572.40 lakhs @ 10.20%, 12.24% & 12.36% on Gross Turnover Without giving abatement benefit, computation of service tax @10.20%, 12.24% & 12.36% on the value of services of ₹4,894.94 lakhs for a period of June 1, 2005 to November 30, 2007. Vide Order dated April 2, 2014 the Tribunal has decided the matter in GIL’s favor.

40. The Department of Service Tax had issued a Show Cause Notice, dated 31 March, 2013, to GIL imposing

Service tax on mobilization advance received from our Clients for the period of August 1, 2008 to September 30, 2012 with respect to various projects of GIL, whereby the Authority computed the tax liability at effective rate of 4.944% (after abatement of 60%) on the Mobilization advance received by GIL on advance the Authority claimed a liability of ₹ 2,446.95 lakhs out which an amount of ₹ 2,350.30 lakhs. There is a dispute with the authority with respect to the pending amount of ₹ 96.65 lakhs Last hearing was held on July 3, 2014. Order is awaited.

41. The Department of Service Tax had issued a Show Cause Notice, dated June 30, 2009, to GIL imposing

Service tax on various categories of services for different slots of period during 2005 to 2008 with respect to GIL’s various projects. The total amount of liability computed by the Authority was ₹ 289.30 lakhs, however prior to issuance of the SCN GIL had already discharged tax liability of ₹ 97.04 lakhs the balance amount of ₹ 192.26 lakhs is under disputed as we are claiming it exempt from service tax based on the view that services are either consumed outside India or they are imported from Outside India for non-taxable Output Service. Last hearing was held on July 3, 2014. Order is awaited.

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42. The Department of Service Tax had issued a Show Cause Notice, dated February 25, 2014, to GIL imposing Service tax on various services imported by GIL from Guizette Associates and Jager Seli, for GDR Issue and Parbati Tunnel Project, respectively, during the period September 1, 2008 to March 31, 2011. The total amount of liability computed by the Authority was ₹ 11.08 lakhs. Reply is yet to be filed by us contesting the above as we are claiming it exempt from service tax based on the view that services are either consumed outside India or they are imported from Outside India for non-taxable Output Service.

43. The Department of Central Excise issued a Show Cause Notice dated July 7, 2012 to GIL imposing Excise Duty on the RMC manufacture by GIL at the site of HDIL Whispering Woods. The total amount claimed by the Authority is ₹2.25 lakhs .The said SCN was replied vide letter dated October 26, 2012 claiming that said RMC is captivity consumed by GIL for its Project and is therefore exempted from the levy of Central Excise Taxes. The Authority issued an Order on March 9, 2013 against GIL. Aggrieved by the said order GIL filed an Appeal before Comm. of CE(Appeals) Belapur, Navi Mumbai on April 10, 2013. Last hearing held on April 25, 2013. Order is awaited.

44. The Department of Central Excise issued a Show Cause Notice dated March 3, 2014 to GIL imposing Excise Duty on the RMC manufacture by GIL at the site of Karnataka Road Works at Thumkur Haveri. The total amount claimed by the Authority is ₹ 7.81 lakhs .The said Show Cause Notice is yet to be replied on the same view as in Sr.No 43.

Tax Proceedings by GIL

1. Deductions have been made as per Government Notification 1493 dated January 14, 1994 on pre-cast component denied in re-assessment by Enforcement Branch, for the period of 1993-94, 1994-95, 1995-96, 1996-97 and 1997-98. An appeal has been filed before the Tribunal and the matter has been put for re-hearing.

2. Tax has been imposed due to a rate difference in Works Contract Tax for the period 2000-2001 and a

claim has been disallowed in the Works Contract Tax for the year of 2001-2002. An appeal was filed by GIL before the Tribunal before the Joint Commissioner of appeals and Tribunals and the matter is currently pending.

3. A claim was disallowed under the Bombay Sales Tax for the period 2001-2002. An appeal has been

made before the Joint Commissioner of Appeals. The matter is currently pending.

4. A VAT on Lease was imposed for the period of 1998-99, 1999-2000, 2000-2001 and 2001-2002 at the Ranchi/Byculla Workshop site of GIL. Appeals have been filed before the Bombay High Court and the Joint Commissioner of Appeals.

5. An appeal has been filed against a wrong determination of taxable amount for the period 2005-06, with

the Joint Commissioner of Appeals II and an unconditional stay has been granted by him.

6. An appeal has been filed by GIL with the Joint Commissioner of Appeals II for not providing tax portion deduction and denying Input Tax Credit for the period 2009-10. A stay has been granted against part payment.

7. An appeal has been filed by GIL, before the Senior Joint Commissioner of Tax, against an arbitrary

demand based on charging interest on reversed Input Tax Credit instead of adjusting it with the remaining refundable amount for the period of 2010-11. The matter is currently pending.

8. An appeal has been filed by GIL, before the revenue board, against an arbitrary demand by rejecting

books of accounts without giving any reason for the period of 2008-09 and 2009-10. The matter has been admitted with the revenue board with full stay.

9. An appeal has been filed by GIL, before the Tribunal, against an arbitrary demand by rejecting books of

accounts without giving any reason for the period of 2007-08. The matter has been admitted by the revenue board with full stay.

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10. An appeal has been filed by GIL, before the Tribunal, against an arbitrary order passed by Joint Commissioner of Sales Tax – Appeals for the period of 2007-2008. The matter is pending before the Tribunal Board.

11. An appeal will be filed by GIL by September 10, 2014 against the assessment completed and the demand

notice received July 28, 2014, for the arbitrary disallowances of expenditures for the period 2011-2012.

12. An appeal has been filed by GIL before the Guwahati High Court against a suo-moto revision of assessment made which allowed deduction of labour charges of more than 25% for the period of 2004-2005. The matter is pending before the High Court.

13. An appeal has been filed by GIL before the Guwahati High Court against an arbitrary demand based on

prejudice about books of accounts by saying that these are not reliable for the period of 2006-2007. The matter is pending before the High Court.

14. An appeal has been filed by GIL before the Deputy Commissioner of Tax, Jharkhand against a non-

receipt of C Form from a client (Transmission and Distribution), for the period of 2010-2011. Demand notice has been issued as per the department’s audit observation and a hearing has been started by the Deputy Commissioner.

15. An appeal has been filed by GIL before the Deputy Commissioner of Tax, Jharkhand against non receipt

of Form E1 from suppliers (Transmission and Distribution), for the period of 2010-2011. Demand notice has been issued as per the department’s audit observation and a hearing has been started by the Deputy Commissioner.

16. An appeal has been filed by GIL before the Deputy Commissioner of Tax, South Circle, Ranchi against a

non-receipt of C Form from a client (Transmission and Distribution), for the period of 2009-2010. .

17. An appeal has been filed by GIL before the Deputy Commissioner of Tax, South Circle, Ranchi against a difference of return amount with respect to a payment by client and a demand based on client confirmation to the department, for the period of 2008-2009. Demand notice has been issued as per the department’s audit observation and a hearing has been started by the Deputy Commissioner.

18. An appeal has been filed, before the Deputy Commissioner of Appeals, against a dispute over the

applicability of VAT rate for the period of 2007-2008.

19. An appeal has been filed by GIL before the Appellate Tribunal against a disallowance of expenses and ITC and imposing a penalty for the period of 2008-2009. The matter is pending for admission and stay at tribunal.

20. An appeal has been filed by GIL before the Appellate Tribunal against a disallowance of expenses and

Input Tax Credit and imposing a penalty for the period of 2009-2010. The matter is pending for admission and stay at tribunal.

21. An appeal has been filed by GIL before the Additional Commissioner of Appeals against disallowance of

Input Tax Credit of sand and grit and disallowance of complete allowable deductions for the period 2008-2009 and 2009-2010. The appeals are pending before the Additional Commissioner, Grade 2 Appeal.

22. An appeal has been filed by GIL before the Additional Commissioner of Appeals against tax levied on

steel, cement and HSD for the period of 2009-2010. The matter is currently pending before the Additional Commissioner, Grade 2 Appeal.

Electricity Board Litigation by GIL

GIL filed a W. P. No.1167/13 before the High Court of Jharkhand at Ranchi against Jharkhand state Electricity Board. The writ petition has been preferred for release of payment of ₹ 6,985.00 lakhs due from Jharkhand State Electricity Board towards Rural Electrification. The case was listed on board on June30, 2014. The matter is pending for admission.

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Direct Tax by GIL

1. A matter is pending with Income Tax Appellate Tribunal, Mumbai for financial year 1977-78 on the issue of Investment Allowance u/s 32AB of the Income Tax Act, 1961. The matter is pending in ITAT.

2. GIL has filed an appeal with Commissioner of Income Tax (Appeals), against the order of the A.O. on disallowance of prior period expenditure & depreciation on dumpers for financial year 2004-05. The matter is pending with Commissioner Income Tax (Appeals).

3. An Order dated May 15, 2014 was passed by the Assessing office u/s 143(3) r.w.s. 153A r.w.s. 144C(3) of the Income Tax Act, 1961 directing GIL to pay additional tax liability as determined by him, for financial year 2005 - 2006. GIL has filed an appeal u/s 246A(1)(ba) of the Income Tax Act, 1961, with the Commissioner of Income Tax (Appeals) - 38, on June 11, 2014 for the disputed tax liability amounting to ₹ 1,133.81 lakhs . The date of hearing on the Appeal is awaited.

4. An Order dated May 15, 2014 was passed by the Assessing office u/s 143(3) r.w.s. 153A r.w.s. 144C(3) of the Income Tax Act, 1961 directing GIL to pay additional tax liability as determined by him, for financial year 2006 - 2007. GIL has filed an appeal u/s 246A(1)(ba) of the Income Tax Act, 1961, with the Commissioner of Income Tax (Appeals) - 38, on June 11, 2014 for the disputed tax liability amounting to ₹ 1,411.60 lakhs. The date of hearing on the Appeal is awaited.

5. An Order dated May 15, 2014 was passed by the Assessing office u/s 143(3) r.w.s. 153A r.w.s. 144C(3)

of the Income Tax Act, 1961 directing GIL to pay additional tax liability as determined by him, for financial year 2007 - 2008. GIL has filed an appeal u/s 246A(1)(ba) of the Income Tax Act, 1961, with the Commissioner of Income Tax (Appeals) - 38, on June 11, 2014 for the disputed tax liability amounting to ₹ 1,622.66 lakhs. The date of hearing on the Appeal is awaited.

6. An Order dated May 15, 2014 was passed by the Assessing office u/s 143(3) r.w.s. 153A r.w.s. 144C(3)

of the Income Tax Act, 1961 directing GIL to pay additional tax liability as determined by him, for financial year 2008 - 2009. GIL has filed an appeal u/s 246A(1)(ba) of the Income Tax Act, 1961, with the Commissioner of Income Tax (Appeals) - 38, on June 11, 2014 for the disputed tax liability amounting to ₹ 3,511.86 lakhs. The date of hearing on the Appeal is awaited.

7. An Order dated May 15, 2014 was passed by the Assessing office u/s 143(3) r.w.s. 153A r.w.s. 144C(3)

of the Income Tax Act, 1961 directing GIL to pay additional tax liability as determined by him, for financial year 2009 - 2010. GIL has filed an appeal u/s 246A(1)(ba) of the Income Tax Act, 1961, with the Commissioner of Income Tax (Appeals) - 38, on June 11, 2014 for the disputed tax liability amounting to ₹ 4,197.48 lakhs. The date of hearing on the Appeal is awaited.

8. An Order dated May 15, 2014 was passed by the Assessing office u/s 143(3) r.w.s. 153A r.w.s. 144C(3)

of the Income Tax Act, 1961 directing GIL to pay additional tax liability as determined by him, for financial year 2010 - 2011. GIL has filed an appeal u/s 246A(1)(ba) of the Income Tax Act, 1961, with the Commissioner of Income Tax (Appeals) - 38, on June 11, 2014 for the disputed tax liability amounting to ₹ 4,474.57 lakhs. The date of hearing on the Appeal is awaited.

Direct tax against GIL

1. Income Tax Department has filed an appeal in Bombay High Court against the order of Income Tax Appellate Tribunal (“ITAT”), Mumbai, on deduction u/s 80HHB of the Income Tax Act, 1961, amounting to ₹ 198.59 lakhs, for financial year 1994-95. The matter is pending in Bombay High Court.

2. Income Tax Department has filed an appeal in Bombay High Court against the order of ITAT, Mumbai,

on depreciation on dumpers, for financial year 2001-02. The matter is pending in Bombay High Court.

3. Income Tax Department has filed an appeal in Bombay High Court against the order of ITAT, Mumbai, pertaining to addition on account of undisclosed income and disallowance of expenditure, amounting to ₹ 159.24 lakhs, for the period April 01, 1995 to January 30, 2002. The matter is pending in Bombay High Court.

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NSE and BSE

1. The National Stock Exchange of India Limited, vide its letter dated March 19, 2014, imposed fine of ₹. 75,000/- on GIL for non-compliance of Clause 41 of the Listing Agreement (non-submission of audited annual accounts of GIL for the 9 months period ended December 31, 2013 within the stipulated time limit).

2. The Bombay Stock Exchange Limited, vide its communication dated March 28, 2014, imposed fine of

₹ 0.84 lakhs on GIL for non-compliance of Clause 41 of the Listing Agreement (non-submission of audited annual accounts of GIL for the 9 months period ended December 31, 2013 within the stipulated time limit).

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STATUTORY AUDITORS

S.R. Batliboi & Co. LLP and Natvarlal Vepari & Co, Chartered Accountants, are our current joint statutory auditors as required by the Companies Act and in accordance with the guidelines issued by the ICAI. Further, S.R. Batliboi & Co. LLP and Natvarlal Vepari & Co, Chartered Accountants, have jointly audited the Financial Statements as of and for the years ended March 31, 2012, March 31, 2013 and nine months ended December 31, 2013.

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GENERAL INFORMATION

1. The Company was originally incorporated on April 23, 2001 as a public limited company called

Gammon Infrastructure Projects and Investments Limited in Mumbai, Maharashtra. On June 15, 2001, we received a certificate of commencement of business. On April 01, 2002, the name was changed to Gammon Infrastructure Projects Limited. The registered office of the Company is situated in Mumbai, Maharashtra.

2. The Issue was authorized and approved by our Board of Directors on June 20, 2014 and approved by

the shareholders at an EGM held on July 15, 2014. 3. We have obtained in-principle approval to list the Equity Shares on BSE and NSE vide letters dated

September 1, 2014. 4. Copies of our Memorandum and Articles of Association will be available for inspection during usual

business hours on any weekday (except Saturdays, Sundays and public holidays) at our Registered Office.

5. We have obtained all consents, approvals and authorizations required in connection with this Issue. 6. Except as disclosed in this Placement Document, there are no material litigation or arbitration

proceedings against or affecting us or our assets or revenues or we are aware of any pending or threatened litigation or arbitration proceedings, which are or might be material in the context of this Issue of Equity Shares.

7. Our consolidated Financial Statements as of and for the Financial Year ending March 31, 2012, March

31, 2013 and as of and for the nine month period ended December 31, 2013 have been jointly audited by M/s Natvarlal Vepari & Co. and M/s S.R. Batliboi & Co. LLP and the joint audit reports of M/s Natvarlal Vepari & Co. and M/s S.R. Batliboi & Co. LLP on the consolidated Financial Statements are included in this Placement Document.

8. Our Company confirms that it is in compliance with the minimum public shareholding requirements as

required under the terms of the listing agreements with the Stock Exchanges. 9. The Floor Price for the issue of Equity Shares is ₹ 13.3375 per Equity Share. The QIP Committee has

on September 4, 2014 approved a discount of ₹ 0.6575 to the floor price in terms of Regulation 85 of SEBI Regulations.

10. The Book Running Lead Managers and their affiliates have provided, and may in the future provide,

investment banking and other services to us, our affiliates, officers and directors, for which and the Book Running Lead Manager and their affiliates have received customary fees and commissions.

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FINANCIAL INFORMATION

Sl. No. Particulars Page No.

1. Auditors' Report and Audited Consolidated Financial Statements as at and for the 9 month period ended December 31, 2013

F-1 to F-44

2. Auditors' Report and Audited Consolidated Financial Statements as at and for the year ended March 31, 2013

F-45 to F-86

3. Auditors' Report and Audited Consolidated Financial Statements as at and for the year ended March 31, 2012

F-87 to F-125

Consolidated Financial Statements

Independent Auditor’s Report

The Board of Directors Gammon Infrastructure Projects Limited

Report on Consolidated Financial StatementsWe have audited the accompanying Consolidated Financial Statements of Gammon Infrastructure Projects Limited (‘GIPL’ or ‘the Company’) and its Subsidiaries, Jointly Controlled Entities and Associates (GIPL Group), which comprise the Consolidated Balance Sheet as at December 31, 2013, and the Consolidated Statement of Profit and Loss and the Consolidated Cash Flow Statement for the period then ended, and a summary of significant accounting policies and other explanatory information.

Management’s Responsibility for the Consolidated Financial StatementsManagement is responsible for the preparation of these Consolidated Financial Statements that give a true and fair view of the consolidated financial position, consolidated financial performance and consolidated cash flows of the Company in accordance with accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the Consolidated Financial Statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor’s ResponsibilityOur responsibility is to express an opinion on these Consolidated Financial Statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the Consolidated Financial Statements are free from material misstatement.An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the Consolidated Financial Statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the Consolidated Financial Statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company’s preparation and presentation of the Consolidated Financial Statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the Consolidated Financial Statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

OpinionIn our opinion and to the best of our information and according to the explanations given to us,the Consolidated Financial Statements give a true and fair view in conformity with the accounting principles generally accepted in India:(a) in the case of the Consolidated Balance Sheet, of the state of affairs of the GIPL Group as at December 31, 2013;(b) in the case of the Consolidated Statement of Profit and Loss, of the loss of the GIPL Group for the period ended on that date; and (c) in the case of the Consolidated Cash Flow Statement, of the cash flows of the GIPL Group for the period ended on that date.

Emphasis of Matter:(a) Without qualifying our opinion, we invite attention to Note 35 to the Consolidated Financial Statements, in relation to notice served by the Company’s subsidiaries for closure of

two projects. The Company’s exposure including Equity contributions and advances is amounting to ` 406,881,213 (excluding guarantees of ` 389,100,000). Pending conclusion between the parties, no adjustments have been made in the Consolidated Financial Statements.

(b) The group incurred a net loss after tax of ` 564,438,626/- during the nine months period ended December 31, 2013 and, as of that date, the group’s current liabilities exceeded its current assets by ` 6,089,713,519/- Management’s plans to address the uncertainty as to the timing and realisation of cash flows are discussed in Note 34 to the Consolidated Financial Statements. Our opinion is not qualified in this matter

Other MatterWe did not audit the Financial Statements of(a) certain subsidiaries whose Financial Statements reflect total assets of ` 15,604,332,953/-as at December 31, 2013, total income of ` 1,080,200,404/-and cash flows of

` (15,054,886/-) for the period then ended and;(b) certain associates whose Financial Statements reflect a total loss of ̀ 3,802,694/-for the period ended December 31, 2013, the Company’s share in the loss of such associates being

` 1,178,037/-. The above mentioned financial statements have been audited by other auditors whose reports have been furnished to us, and our opinion is based solely on the report of other

auditors; and(c) certain joint venture companies whose Financial Statements reflect total assets of ̀ 1,404,305/- as at December 31, 2013, total income of ̀ 24,492/- and cash flows amounting to

` (28,98,526/-) for the period then ended, the Company’s share of such total assets, total income and total cash flows being ` 190,064/-, ` 2,478/- and ` (317,485/-), respectively are based on unaudited Financial Statements certified by the respective managements of the joint ventures.

In respect of the other subsidiaries and joint ventures, the audit has been conducted by either of us and the audit of GIPL has been conducted by us jointly.

For Natvarlal Vepari & Co. For S.R. Batliboi & Co. LLPICAI Firm Registration Number:106971W ICAI Firm Registration Number : 301003E Chartered Accountants Chartered Accountants

N Jayendran per Hemal ShahM. No. 40441 M. No. 42650Partner PartnerMumbai, Dated : March 1, 2014 Mumbai, Dated : March 1, 2014

F - 1

Consolidated Financial Statements

Consolidated Balance Sheetas at December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

Particulars Notes As at December 31, 2013

As at March 31, 2013

Equity and liabilitiesShareholders' fundsShare capital 4 1,476,155,376 1,476,155,376 Reserves and surplus 5 5,232,918,005 5,650,993,240

6,709,073,381 7,127,148,616 Minority interest 6 1,577,253,098 1,801,958,234 Non-current liabilitiesLong-term borrowings 7 37,301,647,526 36,117,195,795 Deferred tax liabilities (net) 8 24,920,735 20,837,532 Other long-term liabilities 9 8,850,000 8,850,000 Long-term provisions 10 558,245,702 750,244,309

37,893,663,963 36,897,127,636 Current liabilitiesShort-term borrowings 11 779,812,313 787,812,481 Trade payables, current 12 197,452,236 242,379,703 Other current liabilities 12 7,158,086,195 5,426,881,971 Short-term provisions 10 758,362,123 243,301,926

8,893,712,867 6,700,376,081 TOTAL 55,073,703,310 52,526,610,567 AssetsNon-current assetsFixed assets :

Tangible assets (net) 13 1,186,718,455 1,202,912,236 Intangible assets (net) 14 23,228,498,822 24,377,473,644 Capital work in progress 15 127,144,496 106,855,898 Intangible assets under development 16 24,443,484,972 20,467,065,343

Goodwill on consolidation 17 533,649,910 452,995,586 Deferred tax asset (net) 8 340,603,137 325,383,157 Non-current investments 18 7,924,865 9,102,903 Long-term loans and advances 19 2,118,368,833 2,307,718,653 Non-current trade receivables 20 163,066,739 558,704 Other non-current assets 21 120,243,733 153,271,997

52,269,703,962 49,403,338,121 Current assetsCurrent investments 22 236,478,084 27,184,279 Inventories 23 115,386,547 63,124,288 Trade receivables 20 179,722,911 378,448,939 Cash and bank balances 24 950,387,121 692,496,270 Short-term loans and advances 19 556,713,070 335,492,759 Other current assets 21 765,311,615 1,626,525,912

2,803,999,348 3,123,272,447 TOTAL 55,073,703,310 52,526,610,567 Summary of significant accounting policies 2.1The accompanying notes are an integral part of the financial statements.

As per our report of even date For and on behalf of the Board of Directors of Gammon Infrastructure Projects Limited

For Natvarlal Vepari & Co. For S. R. Batliboi & Co. LLP Kishor Kumar Mohanty Parag ParikhICAI Firm Regn. No.: 106971W ICAI Firm Regn. No. : 301003E Managing Director Whole-time Director and CFO Chartered Accountants Chartered Accountants

N Jayendran per Hemal Shah Abhijit Rajan C. C. Dayal Partner Partner Director Director Membership No. : 40441 Membership No. : 42650 Homai A. Daruwalla G. Sathis Chandran Director Company Secretary

Place : Mumbai Place : MumbaiDate : March 1, 2014 Date : March 1, 2014

F - 2

Consolidated Financial Statements

Consolidated Statement of Profit and Lossfor the period from April 1, 2013 to December 31, 2013 (All amounts in Indian Rupees unless otherwise stated)

Particulars Notes Period ended December 31, 2013

Year ended March 31, 2013

Income Revenue from operations:

Revenue from projects 25 4,413,236,853 6,621,935,116 Other operating revenues 26 128,543,158 281,832,258

Other income 27 64,810,510 77,624,988 Total income 4,606,590,521 6,981,392,362 Expenses Project expenses 28 1,310,015,386 1,661,946,293 Employee benefits expenses 29 243,530,013 289,254,079 Other expenses 30 214,586,540 278,978,668 Total expenses 1,768,131,939 2,230,179,040 Earnings before interest, tax, depreciation and amortisation (EBITDA) 2,838,458,582 4,751,213,322 Finance costs 31 2,190,286,876 2,968,337,583 Depreciation/amortisation 13,14 1,195,601,954 1,608,521,955 Share of (profit)/loss from investment in associates 1,178,038 (371,976)Profit/(Loss) before tax (548,608,286) 174,725,760 Less: Tax expenses

Current tax 33,813,740 303,296,990 Deferred tax (credit)/charge (11,136,776) (330,190,418)MAT credit entitlement (22,924,650) (48,696,179)Short provision for earlier years 9,732,255 1,678,786

Net tax expense 9,484,569 (73,910,821)Profit/(Loss) after tax (558,092,855) 248,636,581 Less : Profit after tax attributable to minority interest 6,345,771 101,373,328 Profit / (Loss) attributable to group shareholders (564,438,626) 147,263,253 Earnings per share ('EPS') 32

Basic (0.77) 0.20

Diluted (0.77) 0.20

Nominal value of equity share 2.00 2.00

Summary of significant accounting policies 2.1

The accompanying notes are an integral part of the financial statements.

As per our report of even date For and on behalf of the Board of Directors of Gammon Infrastructure Projects Limited

For Natvarlal Vepari & Co. For S. R. Batliboi & Co. LLP Kishor Kumar Mohanty Parag ParikhICAI Firm Regn. No.: 106971W ICAI Firm Regn. No. : 301003E Managing Director Whole-time Director and CFO Chartered Accountants Chartered Accountants

N Jayendran per Hemal Shah Abhijit Rajan C. C. Dayal Partner Partner Director Director Membership No. : 40441 Membership No. : 42650 Homai A. Daruwalla G. Sathis Chandran Director Company Secretary

Place : Mumbai Place : MumbaiDate : March 1, 2014 Date : March 1, 2014

F - 3

Consolidated Financial Statements

Consolidated Cash Flow Statementfor the period from April 1, 2013 To December 31, 2013 (All amounts in Indian Rupees unless otherwise stated)

Particulars Period ended December 31, 2013

Year ended March 31, 2013

A. CASH FLOW FROM OPERATING ACTIVITIES :Profit before tax (548,608,286) 174,725,760 Adjustments for : Employees stock options 2,456,974 (3,519,002)Cash alternative settlement for ESOP scheme (1,741,294) 4,285,167 Depreciation and amortisation 1,195,601,954 1,608,521,955 Gratuity and leave encashment 9,126,098 8,515,166 Interest income (33,263,051) (46,669,168)Interest 2,190,286,876 2,968,337,583 (Profit)/Loss on sale of investments (21,766,577) (25,012,560)Share of (profit) / loss from investment in associates 1,178,038 (371,976)Loss on sale of assets 2,547,796 5,860,832 Assets written off 3,271,896 9,914,535 Provision for periodic maintenance expenses 375,313,000 441,869,728 Provision for loans and advances/other assets 20,007,812 458,495 Provision for diminution in value of investment - (2,300,000)Preliminary and share issue expenses written off - 30,339

3,743,019,522 4,969,921,094 Operating profit before working capital changes 3,194,411,236 5,144,646,854 Adjustments for :Trade and other receivables 937,695,500 (1,171,513,711)Inventories (52,262,259) (28,052,942)Trade payables and working capital finance 190,377,243 (31,915,665)

1,075,810,484 (1,231,482,318)Cash generated from the operations 4,270,221,720 3,913,164,536 Cash Compensation paid - (22,050,000)Direct taxes paid (190,292,763) (281,365,030)Net cash from operating activities 4,079,928,957 3,609,749,506

B. CASH FLOW FROM INVESTMENT ACTIVITIES :Capital purchases after adjusting capital creditors (3,531,230,259) (5,985,747,046)Proceeds on sale of fixed assets 12,282,294 15,342,800 Purchase of investments : - Mutual funds (5,023,850,000) (2,979,328,997)Sale of investments :- Mutual funds 4,876,138,490 2,977,157,278 Intercorporate deposits given: - Granted during the period 22,077,511 (493,490,746)- Refund of intercorporate deposit (230,462,394) 448,926,534 Payment towards debt service reserve (73,500,001) - Advances from/(to) joint venture companies - (62,508,350)Advance paid for acquisition of stake in a subsidiary - (134,793,534)Amount received from/(paid) to minority shareholders

(129,720,000) 49,000,000

Disposal /(acquisition) of stake in a subsidiary/joint venture companies

(38,413,126) 42,578,538

Interest received 24,647,438 37,207,166 Net cash used in investment activities (4,092,030,047) (6,085,656,357)

F - 4

Consolidated Financial Statements

Consolidated Cash Flow Statementfor the period from April 1, 2013 To December 31, 2013 (All amounts in Indian Rupees unless otherwise stated)

C. CASH FLOW FROM FINANCING ACTIVITIES : Proceeds from equity share capital - - Capital grant received - 182,500,000 Proceeds from borrowings 5,095,719,408 12,170,527,917 Repayment of loans (2,814,367,969) (8,268,014,401)Disposal/(Acquisition) of equity stake to minority share holder

- (171,637,077)

Interest paid (2,047,163,927) (3,064,716,117) Dividend paid (including Dividend distribution tax) (37,695,572) - Preliminary and share issue expenses - (1,437,059)Net cash from financing activities 196,491,940 847,223,263 NET INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS

184,390,850

(1,628,683,587)

Cash and cash equivalents, end of the period 876,887,120 692,496,270 Cash and cash equivalents, beginning of the period 692,496,270 2,321,179,857 NET INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS 184,390,850

(1,628,683,587)

COMPONENTS OF CASH AND CASH EQUIVALENTS :

Cash and cheques on hand 10,798,361 10,687,136 With banks : On current accounts 801,088,759 568,659,619 On deposit accounts 65,000,000 113,149,515 Cash and cash equivalents, end of the period 876,887,120 692,496,270

Summary of significant accounting policiesThe accompanying notes are an integral part of the financial statements.

Particulars Period ended December 31, 2013

Year ended March 31, 2013

As per our report of even date For and on behalf of the Board of Directors of Gammon Infrastructure Projects Limited

For Natvarlal Vepari & Co. For S. R. Batliboi & Co. LLP Kishor Kumar Mohanty Parag ParikhICAI Firm Regn. No.: 106971W ICAI Firm Regn. No. : 301003E Managing Director Whole-time Director and CFO Chartered Accountants Chartered Accountants

N Jayendran per Hemal Shah Abhijit Rajan C. C. Dayal Partner Partner Director Director Membership No. : 40441 Membership No. : 42650 Homai A. Daruwalla G. Sathis Chandran Director Company Secretary

Place : Mumbai Place : MumbaiDate : March 1, 2014 Date : March 1, 2014

F - 5

Consolidated Financial Statements

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

1 Background Gammon Infrastructure Projects Limited a listed company and its subsidiaries, joint ventures and associates, are engaged

in the development of various infrastructure projects under the Public Private Partnership (‘PPP’) model in sectors like transportation, energy and urban infrastructure through several special purpose vehicles (“SPVs”). Each project is governed by a separate concession agreement (‘the Contract’) signed between the client (‘grantor’) and the SPV. Majority of the projects secured are from the Government, (Central or State) or an organisation or body floated by the Government.

2 Accounting policies a. Basis of preparation The Consolidated Financial Statements have been prepared to comply in all material respects with the notified

accounting standards by the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956 read with General Circular 15/2013 dated September 13, 2013, issued by the Ministry of Corporate Affairs, in respect of section 133 of the Companies Act, 2013. The consolidated financial statements have been prepared under the historical cost convention, on an accrual basis of accounting. The accounting policies are consistent with those used in the previous year.

b. Principles of consolidation i) Holding company and subsidiaries :

The Consolidated Financial Statements comprise the financial statements of GAMMON INFRASTRUCTURE PROJECTS LTD. (“the Company”) and its Subsidiary companies (the Company and its subsidiaries are hereinafter referred to as ‘the Group’). The Consolidated Financial Statement has been prepared on the following basis:

The Financial Statements of the Company and its subsidiary companies have been combined on a line by line basis by adding the book values of like items of assets, liabilities, income and expenses, after fully eliminating intra-group balances, intra-group transactions and unrealized profits or losses as per Accounting Standard - 21 (‘AS-21’) “Consolidated Financial Statements” notified under the Companies (Accounting Standards) Rules, 2006.

The Consolidated Financial Statements have been prepared using uniform policies for like transactions and other events in similar circumstances and are presented to the extent possible in the same manner as the Company’s separate financial statements.

The financial statements of the entities used for consolidation are drawn upto the same reporting date as that of the Company ie. December 31, 2013.

The excess of cost of investments of the Group over its share of equity in the subsidiary is recognised as goodwill. The excess of share of equity of subsidiary over the cost of investments is recognised as capital reserve.

ii) Interest in joint venture companies : The Group’s interest in the joint ventures, in the nature of jointly controlled entities are included in these

consolidated financial statements using the proportionate consolidation method as per the Accounting Standard – 27 (‘AS-27’) “Financial Reporting of Interests in Joint Ventures” notified under the Companies (Accounting Standards) Rules, 2006 (as amended). The Group combines its share of each of the assets, liabilities, income and expenses of the joint venture with similar items, on a line by line basis.

iii) Investments in associate companies : Investments in associate companies are accounted under the equity method as per the Accounting Standard –

23 (‘AS-23’) “Accounting for Investments in Associates in Consolidated Financial Statements” notified under the Companies (Accounting Standards) Rules, 2006 (as amended).

Under the equity method, the investment in associates is carried in the balance sheet at cost plus post acquisition changes in the Group’s share of net assets of the associate. The statement of profit and loss reflects the Group’s share of the results of operations of the associates.

F - 6

Consolidated Financial Statements

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

The excess of the Group’s cost of investment over its share of net assets in the associate on the date of acquisition of investment is disclosed as goodwill. The excess of the Group’s share of net assets in the associate over the cost of its investment is disclosed as capital reserve. Goodwill / Capital Reserve is included/adjusted in the carrying amount of the investment.

iv) The Build, Operate and Transfer (BOT)/Design, Build, Finance, Operate and Transfer (DBFOT) contracts are governed by service concession agreements with government authorities (grantor). Under these agreements, the operator does not own the road, but gets “toll / annuity collection rights” against the construction services rendered. Since the construction revenue earned by the operator is considered as exchanged with the grantor against toll collection rights, profit from such contracts is considered as realised.

Accordingly, BOT/DBFOT contracts awarded to group companies (operator), where work is subcontracted to fellow subsidiaries/ holding companies, the intra group transactions on BOT/DBFOT contracts and the profits arising thereon are taken as realised and not eliminated.

v) Minority interest in the net assets of consolidated subsidiaries is identified and presented in the consolidated balance sheet separately from liabilities and equity of the company’s shareholders. Minority interest in the net assets of consolidated subsidiaries consists of:

a) The amount of equity attributed to minority at the date on which investment in a subsidiary relationship came into existence.

b) The minority share of movement in equity since the date parent subsidiary relationship came into existence.

c) Minority interest share of net profit/(loss) of consolidated subsidiaries for the year is identified and adjusted against the profit after tax of the group.

2.1 Summary of other significant accounting policies

a. Use of estimates The preparation of financial statements in conformity with generally accepted accounting principles requires

management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period end. Although these estimates are based upon management’s best knowledge of current events and actions, actual results could differ from these estimates.

b. Revenue recognition Revenue is recognised to the extent, that it is probable that the economic benefits will flow to the Group and the

revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognised.

i) Infrastructure development business : Toll revenue from operations of tollable roads is recognised on usage and recovery of the usage charge thereon.

The cash compensation due on account of multiple entries of cars has been accounted on accrual basis as per the order of Government of Kerala for which Supplementary Concession Agreement is being worked out between the Government of Kerala, Greater Cochin Development Authority and Cochin Bridge Infrastructure Company Limited (a Group company).

The annuity income earned from Build, Operate, Transfer (‘BOT’) projects is recognised on a time basis over the period during which the annuity is earned. Revenues from bonus and other claims are recognised upon acceptance from customer / counterparty.

F - 7

Consolidated Financial Statements

Revenue by way of berth hire charges, dust suppression charges, cargo handling charges, plot rent, wharfage, barge freight, other charges etc. are recognised on an accrual basis and is billed as per the terms of the contract with the customers at the rates approved by Tariff Authority for Marine Ports (TAMP) as the related services are performed.

Other operating income is recognised on an accrual basis.

ii) Operations and maintenance revenues : Revenue on Operations & Maintenance (O & M) contracts are recognised over the period of the contract as per

the terms of the contract.

iii) Construction contract revenues : Revenue from construction contracts is recognised on the basis of percentage completion method. The

percentage of work completed is determined by the expenditure incurred on the job till date to the total expected expenditure of the contract.

Construction contracts are progressively evaluated at the end of each accounting period. On contracts under execution which have reasonably progressed, profit is recognised by evaluation of the percentage of work completed at the end of the accounting period. Foreseeable losses on contract are fully provided for in the respective accounting period.

iv) Interest income : Interest Income is recognised on a time proportion basis taking into account the amount outstanding and the

rate applicable.

v) Dividend income : Dividend is recognised when the shareholders’ right to receive payment is established by the balance sheet date.

c. Tangible assets Tangible assets are stated at cost net of accumulated depreciation and accumulated impairment losses, if any. Cost

comprises the purchase price and any attributable cost of bringing the asset to its working condition of its intended use. The costs comprises of the purchase price, borrowings costs if capitalisation criteria are met and directly attributable costs of bringing the asset to its working condition for the intended use. Any trade discounts and rebates are deducted in arriving at the cost of the tangible asset. Any subsequent expenses related to a tangible asset is added to its book value only if it increases the future benefits from the existing asset beyond its previously assessed standard of performance. All other day to day repairs and maintenance expenditure and the cost of replacing parts, are charged to the statement of profit and loss for the period during which such expenses are incurred.

Depreciation on tangible fixed assets is provided on the Straight Line Method (‘SLM’) at the rates and in the manner laid down in Schedule XIV of the Companies Act, 1956 or the rates based on the estimated useful lives of the fixed assets, whichever is higher. Depreciation on tangible fixed assets purchased / installed during the year/ period is calculated on a pro-rata basis from the date of such purchase / installation.

Gains or losses arising from derecognition of tangible fixed assets are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of profit and loss when the asset is derecognised.

d. Intangible assets and Intangible assets under development Intangible assets are stated at cost of construction less accumulated amortised amount and accumulated

impairment losses, if any. Costs include direct costs of construction of the project and costs incidental and related to the construction activity. Costs incidental to the construction activity, including financing costs on borrowings attributable to construction of the project road, have been capitalised to the project road till the date of completion of construction. Such assets include self constructed assets under the BOT (Annuity) scheme, concession rights in respect of tollable roads, etc.

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 8

Consolidated Financial Statements

Intangible assets comprising project road, project port and project bridge are amortised on a straight line basis, from the date they are put to use, over the balance period of the Contract. The amortisation period and the amortisation method are reviewed at each financial year end. Concession rights are amortised on the pro-rata basis of actual tollable traffic volume for the period over the total projected tollable traffic volume over the toll periods granted for the project. The projections for the total traffic volume are based on the report of independent professionals for this purpose. The volume of the traffic is reviewed on periodic intervals for its consistency and appropriateness. If the right to collect toll being amortised is revised on account of the material change in the projected traffic volume arising out of the periodic review, the amortisation would be revised accordingly.

Intangible assets also comprise of rights of Operations and Maintenance (‘O&M’) and an amount paid to Mumbai Port Trust towards upfront fees for construction and operation of an offshore terminal (License Fees Intangible). The O&M intangible results in income stream for the Group for a period of 14 years. The rights are therefore amortised over the period of 14 years on straight line basis. The license fees intangible asset being rights of O&M are amortised over the period of the subsistence of its rights commencing from the date the project becomes operational.

Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of profit and loss when the asset is derecognised.

Intangible asset under development is stated at cost of development less accumulated impairment losses, if any. Costs include direct costs of development of the project road and costs incidental and related to the development activity. Costs incidental to the development activity, including financing costs on borrowings attributable to development of the project road, are capitalised to the project road till the date of completion of development.

e. Impairment The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any

indication exists, or when annual impairment testing for an asset is required, the Group estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or cash-generating unit’s (CGU) net selling price and its value in use. The recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining net selling price, recent market transactions are taken into account, if available. If no such transactions can be identified, an appropriate valuation model is used.

The Group comprises of companies which are each engaged in developing a project facility. On creating these facilities the said companies establish a right to charge the users of the project development facility. The project development costs are recovered by these companies from the users of the project facilities through toll or are compensated by the grantor through annuities. For testing the impairment of the project facility developed, these companies conduct impairment tests based on detailed discounted cash flows annually. The period of the cash flow are from the date, the project was awarded to the date, the project has to be handed over to the grantor.

Impairment losses of operations, including impairment on inventories, are recognised in the statement of profit and loss, except for previously revalued tangible fixed assets, where the revaluation was taken to revaluation reserve. In this case, the impairment is also recognised in the revaluation reserve up to the amount of any previous revaluation.

After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life.

f. Investments Investments that are readily realisable and intended to be held for not more than a year are classified as current

investments. All other investments are classified as long-term investments.

On initial recognition, all investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties.

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 9

Consolidated Financial Statements

Long-term investments are carried at cost. However, provision for diminution in value is made to recognise a decline other than temporary in the value of long term investments.

On disposal of an investment, the difference between the carrying amount and the net disposal proceeds is charged to the statement of profit and loss.

g. Inventories Stores and consumables are valued at lower of cost and net realisable value and is determined using the weighted

average method. Net realisable value is the estimated selling price less estimated cost necessary to make the sale.

h. Borrowing costs Borrowing cost includes interest, amortisation of ancillary costs incurred in connection with the arrangement of

borrowings and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost.

Borrowing costs that are directly attributable to the acquisition, construction or production of an asset that takes a substantial period of time to get ready for its intended use are capitalised. Other borrowing costs are recognised as expenditure in the period in which they are incurred.

i. Provision for taxes Tax expense comprises current and deferred tax. Current income-tax is measured at the amount expected to be

paid to the tax authorities in accordance with the Income-tax Act, 1961 enacted in India and tax laws prevailing in the respective tax jurisdictions where the Group operates. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current income tax relating to items recognised directly in equity is recognised in equity and not in the statement of profit and loss.

Deferred income taxes reflects the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set-off current tax assets against current tax liabilities and the deferred tax assets and the deferred tax liabilities related to the taxes on income levied by same governing taxation laws and to the same taxable entity. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. In situations where the Group has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognised only if there is virtual certainty supported by convincing evidence that they can be realised against future taxable profits.

In the situations where any company within the Group is entitled to a tax holiday under the Income-tax Act, 1961 enacted in India or tax laws prevailing in the respective tax jurisdictions where it operates, no deferred tax (asset or liability) is recognised in respect of timing differences which reverse during the tax holiday period, to the extent the said company’s gross total income is subject to the deduction during the tax holiday period. Deferred tax in respect of timing differences which reverse after the tax holiday period is recognised in the year in which the timing differences originate. However, the said company restricts recognition of deferred tax assets to the extent that it has become reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available against which such deferred tax assets can be realised. For recognition of deferred taxes, the timing differences which originate first are considered to reverse first.

Minimum alternate tax (MAT) paid in a year is charged to the statement of profit and loss as current tax. The Group recognises MAT credit available as an asset only to the extent that there is convincing evidence that the Group will pay normal income tax during the specified period, i.e., the period for which MAT credit is allowed to be carried forward. In the year in which the Group recognizes MAT credit as an asset in accordance with the Guidance Note on Accounting for Credit Available in respect of Minimum Alternative Tax under the Income-tax Act, 1961, the said asset is

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 10

Consolidated Financial Statements

created by way of credit to the statement of profit and loss and shown as “MAT Credit Entitlement.” The Group reviews the “MAT credit entitlement” asset at each reporting date and writes down the asset to the extent the Group does not have convincing evidence that it will pay normal tax during the specified period.

j. Foreign currency translation Initial recognition : Foreign currency transactions are recorded in the reporting currency by applying to the foreign currency amount the

exchange rate between the reporting currency and the foreign currency at the date of the transaction. Conversion : Foreign currency monetary items are reported using the closing rate. Non-monetary items which are carried in

terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction; non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined.

Exchange differences : Exchange differences arising on the settlement of monetary items or on reporting the Group’s monetary items at

rates different from those at which they were initially recorded during the year, or reported in previous financial statements, are recognised as income or as expenses in the year in which they arise except those arising from investments in non-integral operations.

k. Preliminary and share issue expenses Preliminary and share issue expenses (net of taxes) incurred are charged to the security premium account, if available,

or to the statement of profit and loss.

l. Operating lease Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased term are

classified as operating leases. Operating lease payments are recognised as an expense in the statement of profit and loss on a straight line basis over the lease term.

m. Earnings per share Basic and diluted earnings per share are calculated by dividing the net profit or loss for the period attributable to

equity shareholders by the weighted average number of equity shares outstanding during the period. Partly paid shares are treated as a fraction of an equity share to the extent that they are entitled to participate in dividends relative to a fully paid equity share during the reporting period. The weighted number of equity shares are adjusted for events such as bonus issue, bonus element in the rights issue, share split and reverse share split (consolidation of shares) that have changed the number of equity shares outstanding, without corresponding change in resources.

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

n. Employee benefits Retirement benefits in the form of Provident Fund is a defined contribution scheme. The contributions are charged to

the statement of profit and loss for the year when the contributions are due. The Group has no obligation, other than the contribution payable to the provident fund.

The Group operates only one defined benefit plan for its employees i.e. gratuity liability. The costs of providing this benefit are determined on the basis of actuarial valuation at the each year end. Actuarial valuation is carried out using the projected unit credit method. Actuarial gains and losses of the defined benefit plan are recognised in full in the period in which they occur in the statement of profit and loss.

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 11

Consolidated Financial Statements

The Group measures the expected cost of such absences as the additional amount that it expects to pay as a result of the unused entitlement that has accumulated at the reporting date.

The Group treats accumulated leave expected to be carried forward beyond twelve months, as long-term employee benefit for measurement purposes. Such long term compensated absences are provided for based on the actuarial valuation using the projected unit credit method at the year end. Actuarial gains and losses of the defined benefit plan are recognised in full in the period in which they occur in the statement of profit and loss and are not deferred.

o. Employee share based payments (‘ESOP’) The Group uses the intrinsic value (excess of the share price on the date of grant over the exercise price) method

of accounting prescribed by the Guidance Note (‘GN’) on ‘Accounting for employee share-based payments’ issued by the Institute of Chartered Accountants of India (‘ICAI’) (‘the guidance note’) to account for its Employee Stock Option Scheme (the ‘ESOP’ Scheme) read with SEBI (Employees stock option scheme or Employees Stock Purchase) Guidelines,1999. Compensation expense is amortised over the vesting period of the option on SLM basis.

p. Grants received The Group on receipt of construction grant, received as equity support from grantors, accounts the same as capital

reserves. The grant related to operations not forming part of equity support is credited to the statement of the Profit and Loss on a pro-rata basis in the year when the same is due and receivable and when the related costs are incurred.

q. Deferred payment liability The deferred payment liability represents the cash payout (Negative grant) payable to the grantor as per the terms of

the Contract at the end of the concession period is added to the cost of respective asset. The said deferred payment liability does not carry any interest thereon.

r. Minority interest Minority interest comprises of amount of equity attributable to the minority shareholders at the date on which

investments are made by the Group and further movements in their share in the equity, subsequent to the date of the investments.

s. Segment reporting Identification of segments :

Business segments have been identified on the basis of the nature of services, the risk return profile of individual business, the organisational structure and the internal reporting system of the Group.

t. Provisions A provision is recognised when the Group has a present obligation as a result of past event; it is probable that an

outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made of the amount of obligation. Provisions are not discounted to its present value and are determined based on best estimate required to settle the obligation at the reporting date. These are reviewed at each reporting date and adjusted to reflect the current best estimates.

u. Cash and cash equivalents Cash and cash equivalents comprise of cash at bank and in hand and short-term investments with an original maturity

of three months or less.

v. Contingent liability A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by

the occurrence or non-occurrence of one or more uncertain events beyond the control of the Group or a present

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 12

Consolidated Financial Statements

obligation that is not recognised because it is not probable that an outflow of resources will be required to settle an obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognised because it cannot be measured reliably. The Group does not recognise a contingent liability but discloses its existence in the financial statements.

w. Measurement of EBITDA The Group measures EBITDA on the basis of profit/(loss) from continuing operations. In the measurement, the

Company does not include depreciation and amortization expense, finance costs and tax expense.

3 The consolidated financial statements comprise the financial statements of Gammon Infrastructure Projects Limited (‘GIPL’) (the holding company), its subsidiary companies, joint ventures and associates consolidated on the basis of the relevant accounting standards as discussed in note 2b.

a. Subsidiaries : Following subsidiary companies (incorporated in India) have been consolidated in these financial statement as per

AS-21 as on December 31, 2013: :

Voting power & beneficial interestParticulars As at

December 31, 2013As at

March 31, 2013Andhra Expressway Limited ('AEL') 100.00% 100.00%Aparna Infraenergy India Private Limited ('AIIPL') 100.00% 100.00%Birmitrapur Barkote Highway Private Limited ('BBHPL') 100.00% 100.00%Cochin Bridge Infrastructure Company Limited ('CBICL') 97.66% 97.66%Chitoor Infrastructure Company Private Limited ('CICPL') 100.00% 100.00%Dohan Renewable Energy Private Limited ('DREPL') 100.00% 100.00%Earthlink Infrastructure Projects Private Limited ('EIPPL') 100.00% 100.00%Gammon Logistics Limited ('GLL') 100.00% 100.00%Gammon Projects Developers Limited (GPDL') 100.00% 100.00%Gammon Renewable Energy Infrastructure Limited ('GREIL') 100.00% 100.00%Gammon Road Infrastructure Limited ('GRIL') 100.00% 100.00%Gammon Seaport Infrastructure Limited ('GSIL') 100.00% 100.00%Ghaggar Renewable Energy Private Limited ('GREPL') 100.00% 100.00%Gorakhpur Infrastructure Company Limited ('GICL') 96.53% 96.53%Haryana Biomass Power Limited ('HBPL') 100.00% 100.00%Indori Renewable Energy Private Limited ('IREPL') 100.00% 100.00%Jaguar Projects Developers Limited ('JPDL') 100.00% 100.00%Kasavati Renewable Energy Private Limited ('KREPL') 100.00% 100.00%Kosi Bridge Infrastructure Company Limited ('KBICL') 100.00% 100.00%Lilac Infraprojects Developers Limited ('LIDL') 100.00% 100.00%Markanda Renewable Energy Private Limited ('MREPL') 100.00% 100.00%Marine Project Services Limited ('MPSL') 100.00% 100.00%Mormugao Terminal Limited ('MTL') 100.00% 100.00%Mumbai Nasik Expressway Limited ('MNEL') 79.99% 79.99%Patna Buxar Highways Limited ('PBHL') 100.00% 100.00%Pataliputra Highways Limited ('PHL') 100.00% 100.00%Patna Highway Projects Limited ('PHPL') 100.00% 100.00%

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 13

Consolidated Financial Statements

Pravara Renewable Energy Limited ('PREL') 100.00% 100.00%Ras Cities and Townships Private Limited ('RCTPL') 100.00% 100.00%Rajahmundry Expressway Limited ('REL') 100.00% 100.00%Rajahmundry Godavari Bridge Limited ('RGBL') 63.00% 55.65%Satluj Renewable Energy Private Limited ('SREPL') 100.00% 100.00%Sidhi Singrauli Road Project Limited ('SSRPL') 100.00% 100.00%Sikkim Hydro Power Ventures Limited ('SHPVL') 100.00% 100.00%Segue Infrastructure Projects Private Limited ('SIPPL') 100.00% 100.00%Sirsa Renewable Energy Private Limited ('Sirsa REPL') 100.00% 100.00%Tada Infrastructure Development Company Limited ('TIDCL') 100.00% 100.00%Tangri Renewable Energy Private Limited ('TREPL') 100.00% 100.00%Tidong Hydro Power Limited ('THPL') 51.00% 51.00%Vijaywada Gundugolanu Road Project Private Limited ('VGRPPL') 100.00% 100.00%Vizag Seaport Private Limited ('VSPL') 73.76% 73.76%Yamuna Minor Minerals Private Limited ('YMMPL') 100.00% 100.00%Yamunanagar Panchkula Highway Private Limited ('YPHPL') 100.00% 100.00%Youngthang Power Ventures Limited ('YPVL') 100.00% 100.00%

i) The Company has executed an agreement on August 30, 2013 with Simplex Infrastructures Limited to terminate the shareholders agreement for selling 49% in Vijayawada Gundugolanu Road Project Private Limited (VGRPPL). Accordingly, the Company shall hold 100% equity in VGRPPL.

ii) As part of its overall business plans, the Group has been acquiring beneficial interest and voting rights. This beneficial interest along with the Group’s legal shareholdings has resulted in the Group having control over 51% in various SPVs as listed above. The details of the amounts paid and resultant beneficial interest and voting rights acquired are as follows:

As at December 31, 2013 As at March 31, 2013Particulars Equity

sharesNos.

Value`

Beneficial interest

%

Equity shares

Nos.

Value`

Beneficial interest

% AEL 7,540,050 126,651,866 26.00% 7,540,050 126,651,866 26.00% CICPL 10,000 100,000 100.00% 10,000 100,000 100.00% EIPPL 10,000 100,000 100.00% 10,000 100,000 100.00% GICL 14,947,238 149,472,380 27.53% 14,947,238 149,472,380 27.53% KBICL 12,562,831 125,628,310 26.01% 12,562,831 125,628,310 26.01% REL 7,540,050 119,575,780 26.00% 7,540,050 119,575,780 26.00% SIPPL 10,000 100,000 100.00% 10,000 100,000 100.00% THPL 25,500 255,000 51.00% 25,500 255,000 51.00%

b. Joint venture entities : The following jointly controlled entities have been considered applying AS-27 on the basis of audited accounts

(except stated otherwise) for the period ended December 31, 2013.

Voting power & beneficial interestParticulars As at

December 31, 2013As at

March 31, 2013

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 14

Consolidated Financial Statements

i) Details of joint ventures entered into by the Group :

Particulars % of Interest As at

December 31, 2013

% of Interest As at

March 31, 2013

Joint venture companies Blue Water Iron Ore Terminal Private Limited ('BWIOTPL')* 10.12% 10.12% Indira Container Terminal Private Limited ('ICTPL') 50.00% 50.00% GIPL - GIL JV 95.00% - Maa Durga Expressway Private Limited ('MDEPL') ** - 49.00% SEZ Adityapur Limited ('SEZAL')* 38.00% 38.00%

* Based on the un-audited management accounts for the period ended December 31, 2013. ** The Company has executed an agreement on August 30, 2013 with Simplex Infrastructures Limited to

terminate the shareholders agreement for buying 49% in Maa Durga Expressway Private Limited. Accordingly, the Company shall not hold any equity in MDEPL.

ii) The proportionate share of assets, liabilities, income and expenditure of the Joint Ventures consolidated in the accounts is tabulated hereunder:

Particulars As atDecember 31, 2013

As atMarch 31, 2013

AssetsNon-current assetsFixed assets :Tangible assets (net) 12,690,951 13,309,171 Intangible assets (net) 125,000,000 125,000,000 Intangible assets under development 2,502,325,036 2,281,750,418 Long-term loans and advances 72,218,197 79,491,729 Current assetsCurrent investments - 9,184,279 Trade receivables 6,547,837 3,922,489 Cash and cash equivalents 22,024,398 33,435,132 Short-term loans and advances 13,686,956 13,424,331 Other current assets 186,454 7,345,878 Total Assets 2,754,679,828 2,566,863,427 Liabilities Non-current liabilitiesLong-term borrowings 2,086,184,386 1,961,861,013 Long-term provisions - 702,405 Current LiabilitiesTrade payables, current 176,566 67,360,477 Other current liabilities 337,636,290 157,433,393 Short-term provisions 13,657 68,009 Total liabilities 2,424,010,899 2,187,425,297 Reserves and surplusDeficit in the statement of profit and loss :Opening balance (249,595,907) (202,537,505)Loss during the current period (18,741,356) (47,692,714)Total reserves and surplus (268,337,263) (250,230,219)Total reserves, surplus and liabilities 2,155,673,636 1,937,195,078

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 15

Consolidated Financial Statements

Particulars Period endedDecember 31, 2013

Year endedMarch 31, 2013

IncomeRevenue from projects 25,394,902 26,531,767 Other income 94,652 942,327 Total income 25,489,554 27,474,094 Expenses Project expenses 17,490,906 39,506,967 Employee benefit expenses 3,394,512 9,660,258 Other expenses 20,159,649 14,629,299 Exceptional items - - Finance cost 2,800,000 3,650,000 Depreciation and amortisation 449,103 7,650,461 Total expenses 44,294,170 75,096,986 Profit before tax (18,804,616) (47,622,892)Provision for tax (63,260) - Profit after tax (18,741,356) (47,622,892)Capital commitments 1,325,565,941 1,332,012,768

The above figures pertaining to the joint venture companies are based on the audited accounts of ICTPL and GIPL-GIL JV and unaudited management accounts of BWIOTPL and SEZAL for the period ended December 31, 2013. All the joint venture companies were incorporated in India.

c. Associates : The following associates have been accounted by applying the equity method in accordance with the Accounting

Standard (AS) – 23 “ Accounting for Investment in Associates in Consolidated Financial Statements”.

Particulars % of InterestAs at

December 31, 2013

% of InterestAs at

March 31, 2013

ATSL Infrastructure Projects Limited ('AIPL')* 49.00% 49.00%Eversun Sparkle Maritime Services Private Limited ('ESMSPL') 30.90% 30.90%Modern Tollroads Limited (MTRL) 49.00% 49.00%*Based on the un-audited management accounts for the period ended December 31, 2013.

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 16

Consolidated Financial Statements

4 Share capital

Particulars As at December 31, 2013

As at March 31, 2013

i) Authorised equity share capital :1,000,000,000 (Previous year : 1,000,000,000) equity shares of `2 each 2,000,000,000 2,000,000,000 Total authorised equity share capital 2,000,000,000 2,000,000,000

ii) Issued and subscribed equity share capital :734,836,688 (Previous year : 734,836,688 ) equity shares of ` 2 each 1,469,673,376 1,469,673,376 Total issued and subscribed equity share capital 1,469,673,376 1,469,673,376

iii) Paid-up equity shares : 734,026,438 (Previous year : 734,026,438) equity shares of ` 2 each fully paid-up 1,468,052,876 1,468,052,876 Total paid-up equity shares 1,468,052,876 1,468,052,876

iv) Forfeiture of equity shares :Money received in respect of 162,050 (Previous year :162,050) equity shares forfeited of `10 each 8,102,500 8,102,500 Total money received of forfeited equity shares 8,102,500 8,102,500 Total net paid-up equity share capital 1,476,155,376 1,476,155,376

a. Reconciliation of the number of equity shares outstanding at the beginning and at the end of the period :

As at December 31, 2013

As at March 31, 2013

Particulars Numbers ` Numbers `

Equity shares of ` 2 each fully paid-up Balance, beginning of the period 734,026,438 1,468,052,876 728,763,618 1,457,527,236 Issued during the year on exercise of Employee Stock Options ('ESOP') - - - - Issued during the period as bonus shares - - 5,262,820 10,525,640 Balance, end of the period 734,026,438 1,468,052,876 734,026,438 1,468,052,876

b. Terms / rights attached to equity shares : The Company has only one class of shares referred to as equity shares having a par value of ` 2/- per share. Each

holder of equity shares is entitled to one vote per share.

In the event of liquidation of the Company, the equity share holders will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

c. The Company has issued bonus shares during the previous year to the shareholders other than the promoter group

in the ratio of 1:34 (with the fractions being rounded-off to the next higher whole number) aggregating to 5,262,820 equity shares of ` 2/- each as fully paid by utilising securities premium account aggregating to ` 10,525,640 /-

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 17

Consolidated Financial Statements

d. Shares held by the holding company and /or their subsidiaries / associates : Out of equity shares issued by the Company, shares held by its holding and /or their subsidiaries / associates are as follows;

As atDecember 31, 2013

As at March 31, 2013

Registered shareholders Numbers ` Numbers `

Equity shares of ` 2/- each fully paid-up Gammon India Limited ('GIL'), holding company 528,000,000 1,056,000,000 528,000,000 1,056,000,000 Gactel Turnkey Projects Limited ('GTPL'), subsidiary of the holding company 22,400,000 44,800,000 22,400,000 44,800,000 Total 550,400,000 1,100,800,000 550,400,000 1,100,800,000

e. Details of registered shareholders holding more than 5% shares :

As atDecember 31, 2013

As at March 31, 2013

Registered shareholders holding more than 5%

Numbers % of holding Numbers % of holding

Equity shares of ` 2/- each fully paid-up GIL 528,000,000 71.93% 528,000,000 71.93%Total 528,000,000 71.93% 528,000,000 71.93%

As per the records of the Company, including its register of shareholders/members and other declarations received from shareholders, the above shareholding represents legal ownership of the shares.

f. Shares reserved under options to be given: 5,320,000 (Previous year : 1,146,670) equity shares of `2 each of the Company has been reserved for issue as ESOPs

[note 5(b)].

5 Reserves and surplus

Particulars As at December 31, 2013

As at March 31, 2013

Capital reserve :Capital grant :Balance, beginning of the period 946,279,496 1,373,650,000 Add : Capital grant received during the period - 182,500,000 Add : Capital grant transferred by minority share holders 119,521,980 - Less : Capital grant transferred to minority share holders - 609,870,504 Balance, end of the period (A) 1,065,801,476 946,279,496 Securities premium account :Balance, beginning of the period 3,497,510,764 3,509,443,124 Less : Utilised on issuance of bonus shares - (10,525,640)

Less : Share issue expenses during the period - (1,406,720)

Balance, end of the period (B) 3,497,510,764 3,497,510,764

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 18

Consolidated Financial Statements

Particulars As at December 31, 2013

As at March 31, 2013

Employee stock options :Opening Balance 3,059,000 6,578,002 Less : Employee stock options lapsed 3,059,000 3,565,249 Add : Employee stock options outstanding - ESOP 2013 29,568,000 - Less : Employee stock options forfeited 4,032,000 - Less : Deferred Employee compensation outstanding 20,020,026 (46,247)Balance, end of the period (C) 5,515,974 3,059,000 Other reserves :General ReserveBalance, beginning of the period 313,248,076 313,248,076 Add: Amounts transferred from surplus balance in the statement of profit and loss - - Balance, end of the period (D) 313,248,076 313,248,076 Surplus / (deficit) in the statement of profit and loss:-Balance, beginning of the period 890,895,904 781,328,222 Add : Profit /(Loss) for the period (564,438,626) 147,263,253 Add : Losses from Joint Venture reversed on termination of JV agreement 334,312 - Less: Proposed dividend for minority shareholders (refer note 44)

- 22,877,417

Less: Tax on proposed dividend - 14,818,155 Add: Losses of previous year attributable to Minority Interest 26,765,434 - Add: Minority interest in profits/(losses) of subsidiaries for the earlier years (2,715,309) - Balance, end of the period (E) 350,841,715 890,895,904 Total reserves and surplus (A+B+C+D+E) 5,232,918,005 5,650,993,240

a. Capital grant : Capital grant includes group’s portion of grant received by two SPVs of the Group, from NHAI and the Government of

Andhra Pradesh in the nature of equity support of the grantor. b. Employees stock options (‘ESOP’) : All balance options under the ESOP schemes issued in the previous years (ESOP Scheme 2007 and ESOP scheme

2008), have lapsed during the current period.

During the current financial period the Company has instituted an ESOP Scheme “GIPL ESOP 2013”, approved by the shareholders vide their resolution dated September 20, 2013, as per which the Board of Directors of the Company granted 6,160,000 equity-settled stock options to the eligible employees. Pursuant to the ESOP Scheme each options entitles an employee to subscribe to 1 equity share of ` 2 each of the Company at an exercise price of `2 per share upon expiry of the respective vesting period which ranges from one to four years commencing from October 1, 2014. During the current period, 840,000 options were forfeited / lapsed and balance 5,320,000 options are outstanding.

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 19

Consolidated Financial Statements

The details of the grants under the aforesaid ESOPs Schemes are summarized herein under :

ESOP scheme 2013:

For the period2013

Grant Date 23-Sep-13Market Price as on grant date of equity shares granted (Rupees) 6.80 Exercise Price of Options granted during the period (Rupees) 2.00 Options outstanding at the beginning of the period - Options granted during the period 6,160,000 Options lapsed /forfeited during the period 840,000 Options exercised during the period - Options granted and outstanding at the end of the period 5,320,000

The Company has used intrinsic value method for valuation of options by reducing the exercise price from the market value. However if the compensation cost would have been determined using the alternative approach to value options at fair value, the Company’s net profit for the period ended December 31, 2013 as reported would have been changed to amounts indicated below:

Particulars Period endedDecember 31, 2013

Year ended March 31, 2013

Net Income as reported (564,438,626) 147,263,253 Add: Stock based compensation expense included in the reported income 5,515,974 46,247 Less: Stock based compensation expenses determined using fair value of options 5,319,986 233,195 Net profit / (loss) (adjusted) (564,242,638) 147,076,305 Basic earnings per share as reported (0.77) 0.20 Basic earnings per share (adjusted) (0.77) 0.20 Diluted earnings per share as reported (0.77) 0.20 Diluted earnings per share (adjusted) *(0.77) 0.20 Weighted average number of equity shares at the end of the year 734,026,438 734,026,438 Weighted average number of shares considered for diluted earnings per share (adjusted) 737,781,732 734,180,933

* The EPS on dilutive basis is anti-dilutive and therefore it is same as basic EPS.

The fair value has been calculated using Black-Scholes Option Pricing Model and the significant assumptions & inputs to estimate fair value of options are as follows:

Period ended December 31, 2013

First vesting Second vesting Third vesting Fourth vestingDividend yield (%) 0.00% 0.00% 0.00% 0.00%Expected volatility (%) 39.31% 44.25% 42.29% 41.78%Risk-free interest rate (%) 9.86% 9.02% 8.96% 9.03%Grant date 23-Sep-13 23-Sep-13 23-Sep-13 23-Sep-13Vesting date 01-Oct-14 01-Oct-15 01-Oct-16 01-Oct-17Fair value of share price (`) 6.40 6.40 6.40 6.40 Exercise price (`) 2.00 2.00 2.00 2.00

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 20

Consolidated Financial Statements

6 Minority interest

Particulars As at December 31, 2013

As at March 31, 2013

Balance, beginning of the period 1,801,958,234 1,219,772,941 Add: Minority interest in equity : (Decrease) / Increase in minority's share in equity capital of subsidiaries in the current period

(129,720,000) (129,058,538)

Profit / (loss) balance transferred to / (from) minority share holders (26,765,434) - Capital grant transferred to / (from) minority share holders (77,280,782) 609,870,504

(233,766,216) 480,811,965 Add: Minority interest in profits/(losses) of subsidiaries : Minority interest in profits/(losses) of subsidiaries for the current period 6,345,771 101,373,328 Minority interest in profits/(losses) of subsidiaries for the earlier years 2,715,309 - Changes in Minority interest in profits/(losses) of subsidiaries on sale of stake by minority - -

9,061,080 101,373,328 Balance, end of the period 1,577,253,098 1,801,958,234

7 Long-term borrowings

Non-current Current

Particulars As at December 31, 2013

As at March 31, 2013

As at December 31, 2013

As at March 31, 2013

I Term loans[refer below for details of security]Indian rupee loans from banks 26,831,127,896 22,215,844,008 1,000,005,372 1,917,333,716 From financial institutions 9,133,364,630 12,564,196,787 3,134,492,925 1,112,264,705 From others - - 250,000,000 250,000,000

35,964,492,526 34,780,040,795 4,384,498,297 3,279,598,421 II 10.3% intercorporate loan,

unsecured From a minority shareholder 137,155,000 137,155,000 - -

III Deferred payment liability, unsecuredNegative grant payable to NHAI 1,200,000,000 1,200,000,000 - - Amount disclosed under "Other Current Liabilities" (note 12) - - (4,384,498,297)

(3,279,598,421)

Total long term borrowings 37,301,647,526 36,117,195,795 - - The above term loans includes :Secured borrowings 35,428,939,927 34,205,562,616 4,384,498,297 3,279,598,421 Unsecured borrowings 535,552,599 574,478,179 - - Total 35,964,492,526 34,780,040,795 4,384,498,297 3,279,598,421

a. The above term loans from banks and financial institutions are primarily taken by various project executing entities of the Group for the execution of the projects. These loans are secured by a first mortgage and charge on all the movable properties, immovable properties, tangible assets, intangible assets and all bank accounts (including escrow bank accounts) save and except the project assets of each individual borrowing company in the Group.

b. Loans from others are secured by first charge on proceeds/ receivables to be received from the National Highways Authority of India (NHAI) towards annuities to be received for the period between the Scheduled Commercial Operation Date and the actual Commercial Operations Date (COD). This loan carries interest rate in the range of 13% p.a. The loan is repaid on February 14, 2014.

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 21

Consolidated Financial Statements

c. One of the Group SPV had obtained a secured term loan from a financial institution for which charge is yet to be created as at December 31, 2013. The financial institution has levied a penal interest of ` 45,155,223 upto December 31, 2013 which has not been paid. Delay in creation of Mortgage is also on account of non-functioning of Registration Department from past three months due to State wide agitation and the Company is seeking waiver of penal interest as a matter of force majeure.

d. One of the SPV has defaulted in repayment of debt to a financial institution to the extent of ` 420,000,000/- as at December 31, 2013.

e. Term loan from financial institution also includes loan availed by GIPL and is secured by a) Pledge of equity shares of one of the SPV for an aggregate value of ` 1,433,447,400 (previous year - ` 2,194,500,000), b) a first and exclusive charge on the Designated account, Debt Service Reserve aggregating to ` 73,500,001 as on December 31, 2013, (previous year ` 101,021,821), Surplus Monies and the sale proceeds to be received by the Borrower due to Mumbai Nasik Expressway Limited ‘MNEL’ Stake sale and/or the Lender exercising its power in respect of the Borrower’s stake in MNEL under the Loan Agreement. The balance is secured by equity shares of GIPL pledged by the holding company, hence is shown as unsecured portion. This term loan carries an interest rate of 14.00% pa. It’s repayment is entirely due on September 15, 2014.

f. Pledge of shares : The equity shares held by the Company and / or GIL in a subsidiary and /or joint venture company of the Group

are pledged with respective lenders or consortium of lenders for the individual secured loan availed by the said subsidiary and / or joint venture company from their respective lenders or consortium of lenders.

Number of equity shares pledged

Particulars Face value of equity shares `

December 31, 2013Numbers

March 31, 2013Numbers

AEL 10.00 13,175,970 13,175,970 BBHPL 10.00 2,600 2,600 CBICL 10.00 1,664,019 1,664,019 GICL 10.00 27,686,396 27,686,396 KBICL 10.00 20,767,040 20,767,040 ICTPL 10.00 16,500,000 16,500,000 MNEL 10.00 38,942,800 38,942,800 PBHL 10.00 14,589,823 13,000 PHL 100.00 7,350 7,350 PHPL 10.00 750,000 750,000 REL 10.00 14,744,579 14,744,579 RGBL 10.00 89,573,750 89,573,750 SSRPL 10.00 26,236,600 -

VSPL 10.00 63,770,015 61,515,633

Total 328,410,942 285,343,137

The change in the balances between March 31, 2013 and December 31, 2013 represent addition /reduction of pledge during the current period.

g. Interest rates : The above mentioned long-term loans carry an interest rate which is at a spread above/below the bank’s base rate or

bank prime lending rate or G-sec rate or at a negotiated rate. The spread ranges from 50 to 300 bases points. In case of a consortium of lenders the rate applicable is the highest rate charged by any one member of the consortium thereof.

Loans from others, carries interest rate in the range of 10% p.a. to 14% p.a.

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 22

Consolidated Financial Statements

h. Schedule of repayments of the term loans :

As atDecember 31, 2013

As at March 31, 2013

Installments payable within next one year 4,384,498,297 3,279,598,421 Installments payable between 2 to 5 years 14,323,081,693 15,541,645,534 Installments payable beyond 5 years 21,641,410,833 19,238,395,261 Total 40,348,990,823 38,059,639,216

i. Unsecured intercorporate loan : The repayment of the same is due on March 31, 2015.

j. Unsecured, deferred payment liability : As per the terms of the concession agreement between MNEL and NHAI, MNEL is required to make a cash payout

(‘Negative Grant’) of ̀ 1,200,000,000 in the last year of the concession period (i.e. March, 2026). The same is capitalised as toll concession rights and is represented as deferred payment liability in the financial statements.

k. An undertaking has been given to a financial institution by few of the subsidiaries of the Group as a support for the Rupee Term Loan (RTL) of ̀ 3,100,000,000/- extended by a financial institution to GIPL that these subsidiaires shall not raise any further funds till the loan is outstanding.

8 Deferred tax liabilities (net)

Particulars As at December 31, 2013

As at March 31, 2013

Deferred tax asset 340,603,137 325,383,157 Deferred tax liability 24,920,735 20,837,532 Net deferred tax asset/(liability) 315,682,402 304,545,625 Deferred tax assetOn unabsorbed depreciation 603,409,150 604,603,209 On account of employee benefits 20,557,677 10,422,736 Deferred tax liabilityOn account of depreciation/amortisation 308,284,426 310,480,320 Net deferred tax asset/(liability) 315,682,401 304,545,625

One of the SPV has unabsorbed depreciation as per tax returns which is available for set off against taxable income. The SPV has recognised the deferred tax asset credit estimating its future taxable income on the basis of the actual traffic plying on the road during the balance period of the Concession which satisfies the test of virtual certainty supported by convincing evidence for recognising the deferred tax asset on the unabsorbed depreciation as per the tax returns. The SPV had obtained an independent expert’s opinion about the satisfaction of the convincing evidence as required by Accounting Standard (AS) - 22 on Accounting for taxes on income. The deferred tax asset recognised amounts to ̀ 345,486,267 (Previous year : `330,266,288) on the unabsorbed depreciation as per the tax returns available for set off from future taxable income.

9 Other long-term liabilities

Particulars As at December 31, 2013

As at March 31, 2013

Margin money deposit * 5,000,000 5,000,000 Performance deposit from vendor 3,850,000 3,850,000 Total other long-term liabilities 8,850,000 8,850,000

* Received from a joint venture against bank guarantee issued from GIPL’s limits.

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 23

Consolidated Financial Statements

10 Provisions

As at December 31, 2013

As atMarch 31, 2013

Particulars Long-term Short-term Long-term Short-term

Provision for employee benefitsProvision for gratuity (refer note (a) below) 8,279,214 663,764 7,415,139 306,093 Provision for leave encashment 18,180,635 5,305,269 18,856,442 4,003,951 Provision for cash compensation scheme (refer note (b) below)

-

-

-

1,741,294

26,459,849 5,969,033 26,271,581 6,051,338 Other provisionsProposed dividend - - - 22,877,417 Dividend distribution tax on proposed dividend - - - 14,818,155 Provision for taxation (refer note (c) below) - 184,893,215 - 199,555,016 Provision for periodic maintenance (refer note (b) below) 531,785,853 567,499,875 723,972,728 -

531,785,853 752,393,090 723,972,728 237,250,588 Total provisions 558,245,702 758,362,123 750,244,309 243,301,926

a. Gratuity : The revised AS -15 (Employee Benefits) is applicable to the Group.

Under the gratuity plan, every employee who has completed atleast five years of service gets a gratuity on departure @ 15 days of last drawn salary for each completed year of service. The schemes of all the Group companies except for the one joint venture SPV is unfunded.

The following table summarises the components of net benefit expense recognised in the statement of profit and loss and amounts recognised in the balance sheet.

Particulars December 31, 2013 March 31, 2013Current service cost 1,734,833 2,284,418 Interest cost on benefit obligation 539,257 559,594 Expected return on plan asset - (71,823)Actuarial (gain)/loss (905,468) (463,818)Past service cost - - 1,368,623 2,308,371 Less : Gratuity capitalised 389,896 361,454 Net benefit expense 978,727 1,946,917

The changes in the present value of the defined benefit obligation are as follows : Particulars December 31, 2013 March 31, 2013Opening defined benefit obligation 8,485,148 6,533,966 Current service cost 1,612,418 2,983,681 Interest cost on benefit obligation 497,007 704,309 Actuarial (gain)/loss (1,003,418) (1,175,419)Past service cost - - Less : Benefit paid 648,177 561,390 Closing defined benefit obligation 8,942,978 8,485,148

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 24

Consolidated Financial Statements

The gratuity scheme of a joint venture SPV is funded with an insurance company in the form of a qualifying insurance policy. The details of fair value of the plan assets is as follows : Particulars December 31, 2013 March 31, 2013Fair value of plan assets at the beginning of the period 921,648 844,977 Expected return on plan assets 57,027 71,823 Contributions (648,965) 188,511 Actuarial gain/(loss) on plan assets (296,481) (179,438)Prior year value of plan assets 153,225 (4,225)Fair value of plan assets at the end of the period 186,454 921,648

The actual return on plan assets of the SPVs is presently not available. Particulars Period ended

December 31, 2013

Year ended March

31, 2013

Year ended March

31, 2012

Year ended March

31,2011

Year ended March

31, 2010Actuarial (gain)/loss (1,016,016) (1,175,419) 264,881 1,076,164 (134,208)Experience adjustment (175,392) (1,718,246) 392,746 745,251 (209,553)Changes in actuarial assumptions 840,624 (542,827) (127,865) 328,929 78,767

The principal assumptions used in determining the gratuity obligations are as follows: Particulars Period ended

December 31, 2013Year ended

March 31, 2013Discount rate 9.50% 8.75%Expected rate of return on planned assets Not applicable Not applicableAttrition rate 2% 2%Retirement age 60 years 60 years

The estimates of future salary increases, considered in actuarial valuation take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

b Employee cash compensation scheme and Periodic maintenance : The movement of provisions during the year as required by Accounting Standard 29 “Provisions, Contingent Liabilities

and Contingent Assets” notified under the Companies (Accounting Standards) Rules, 2006, (as amended) is as under:

Employee cash compensation scheme Periodic maintenance expensesParticulars December 31, 2013 March 31, 2013 December 31, 2013 March 31, 2013Balance,beginning of the period 1,741,294 19,506,127 723,972,728 282,103,000 Add: Additions during the period - 5,013,918 375,313,000 441,869,728 Less : Reversed during the period - - - - Less : adjusted to reserves 1,741,294 728,751 - - Less : Utilised during the period - 22,050,000 - - Balance, end of the period - 1,741,294 1,099,285,728 723,972,728

c. Demand of `205,089,058 has been raised by the income-tax authorities for Assessment Years 2005-06 to 2011-12 pursuant to assessment proceedings conducted under Section 153A of the Income Tax Act, 1961. The Company has filed an appeal against the said demand with The Commissioner of Income-tax (Appeals), Mumbai. It has also deposited a sum of `16,000,000 for Assessment Years 2007-08 to 2011-12 against the demand. However, the provisions for tax made by the Company are adequate to meet the said demand.

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 25

Consolidated Financial Statements

11 Short-term borrowings

Particulars As at December 31, 2013

As at March 31, 2013

Bank overdraft (Unsecured except to the extent of `50,000,000/- which is against pledge of fixed deposits) 779,812,313 787,812,481 (Interest rate on this overdraft facility is currently 13.25% )Total short-term borrowings 779,812,313 787,812,481

12 Other current liabilities

Particulars As at December 31, 2013

As at March 31, 2013

Total trade payables (A) 197,452,236 242,379,703 Other liabilities Current maturities of long-term borrowings (note 7) 4,384,498,297 3,279,598,421 Interest accrued :-

to related party - ICTPL 1,226,992 1,000,966 to financial institution 43,416,069 49,550,337 to banks 1,137,163 - to minority shareholders 23,357,872 -

Advances received from clients :-from related party - GIL 86,123,970 - from others 65,009,817 26,597,631

Dues against capital expenditure :- to related party - GIL 1,412,667,677 1,123,839,198 to others 237,624,758 208,475,849

Dues to related parties (refer note c below) 276,209,070 198,689,909 Amount of share application money received in subsidiaries 219,001,000 219,001,000 Duties and taxes payable 19,117,336 55,593,256 Book overdraft* 2,805 - Others 388,693,369 264,535,404 Total other liabilities (B) 7,158,086,195 5,426,881,971 Total other current liabilities (A + B) 7,355,538,431 5,669,261,674

*Book overdraft represents cheques issued in excess of balance in current account with bank.

a. Details of dues to related parties :

Particulars As at December 31, 2013

As at March 31, 2013

GIL, the holding company 97,077,762 18,946,161 GIPL - GIL JV 180,979 - BWIOTPL, joint venture entity 74,034 182,706 ICTPL, joint venture entity 2,356,295 3,041,042 Modern Tollroads Limited, an associate company 26,520,000 26,520,000 Ansaldocaldaie Boilers India Private Limited, a subsidiary of the holding company 150,000,000 150,000,000 Total dues to related parties 276,209,070 198,689,909

b. Amount due to minority share holders includes share application money received from minority shareholders of VGRPPL `49,000,000 (Previous year : `49,000,000), RCTPL `170,000,000 (Previous year : `170,000,000) and SREPL `1,000 (Previous year : `1,000).

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 26

Consolidated Financial Statements

13

Tang

ible

ass

ets

Part

icula

rsFr

eeho

ld

Land

Leas

ehol

d La

ndBu

ildin

gsPl

ant a

nd

Mac

hine

ryEa

rth

Mov

ing

Mac

hine

ry

Furn

iture

an

d Fi

xtur

es

Elec

trica

l Eq

uipm

ents

Office

Eq

uipm

ents

Co

mpu

ters

Mot

or

Vehi

cles

Tota

l

Cost

or va

luat

ion

As at

April

1, 20

12 23

7,647

,966

151,3

40,70

9 27

,042,2

63

1,007

,818,5

63

120,7

97

25,84

1,997

-

17,96

4,141

40

,332,4

09

36,21

6,697

1,

544,3

25,54

2 Ad

dition

s -

33,99

5,168

-

13,69

9,129

-

1,46

9,314

-

2,79

5,301

4,

310,2

95

1,40

8,650

57

,677,8

57

Sales

/disp

osals

/adju

stmen

ts -

- -

49,23

0,132

-

511,0

18

- 34

0,144

72

4,308

2,

629,1

13

53,43

4,715

As

at M

arch

31, 2

013

237,6

47,96

6 18

5,335

,877

27,04

2,263

97

2,287

,560

120,7

97

26,80

0,293

-

20,41

9,298

43

,918,3

96

34,99

6,234

1,

548,5

68,68

4 Ad

dition

s -

3,02

2,830

-

1,77

1,080

-

11,54

8,889

-

3,94

5,335

1,

683,4

04

25,79

6,191

47

,767,7

29

Sales

/disp

osals

/adju

stmen

ts -

- -

6,77

9 -

16,81

0,781

-

3,17

8,267

1,

564,4

95

357,3

75

21,91

7,697

As

at D

ecem

ber 3

1, 20

13 23

7,64

7,96

6 18

8,35

8,70

7 27

,042

,263

97

4,05

1,86

1 12

0,79

7 21

,538

,401

-

21,1

86,3

66

44,0

37,3

05 6

0,43

5,05

0 1,

574,

418,

716

Accu

mul

ated

Dep

recia

tion

As at

April

1, 20

12 -

- 12

,836,9

21

264,4

93,85

5 51

,243

3,71

3,513

-

2,24

8,013

15

,495,6

78

8,37

4,116

30

7,213

,339

Char

ge fo

r the

year

- -

3,53

5,816

50

,023,6

66

13,66

2 4,

372,9

40

- 1,

151,1

54

6,66

4,891

3,

527,9

44

69,29

0,073

On

sale/

dispo

sals/

adjus

tmen

ts -

- -

29,37

2,181

-

49,30

2 54

,155

540,1

25

831,2

00

30,84

6,963

As at

Mar

ch 31

, 201

3 -

- 16

,372,7

37

285,1

45,34

0 64

,905

8,03

7,151

-

3,34

5,012

21

,620,4

44

11,07

0,860

34

5,656

,448

Char

ge fo

r the

perio

d -

- 1,

890,2

52

34,98

0,403

10

,293

3,17

7,744

-

1,23

4,428

4,

964,8

50

2,87

3,456

49

,131,4

26

On sa

le/d

ispos

als/

adju

stmen

ts -

- -

16,9

00

- 5,

826,

897

421,

914

540,

403

281,

499

7,08

7,61

3 As

at D

ecem

ber 3

1, 20

13 -

- 18

,262,9

89

320,1

08,84

3 75

,198

5,38

7,998

-

4,15

7,526

26

,044,8

91

13,66

2,817

38

7,700

,261

Net B

lock

As at

Mar

ch 31

, 201

3 23

7,64

7,96

6 18

5,33

5,87

7 10

,669

,526

68

7,14

2,22

0 55

,892

18,

763,

142

- 17

,074

,286

22

,297

,952

23,

925,

374

1,20

2,91

2,23

6 As

at D

ecem

ber 3

1, 20

13 23

7,64

7,96

6 18

8,35

8,70

7 8,

779,

274

653,

943,

018

45,5

99 1

6,15

0,40

3 -

17,0

28,8

40

17,9

92,4

14 4

6,77

2,23

3 1,

186,

718,

455

Dep

reci

atio

n ch

arge

for t

he p

erio

d in

clud

es a

n am

ount

of `

762

,692

(pre

viou

s ye

ar :

` 1,

654,

156)

cap

italis

ed to

inta

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sset

und

er d

evel

opm

ent

and

an a

mou

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f `63

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(pre

viou

s ye

ar : `

84,5

02) c

apita

lised

to c

apita

l wor

k in

pro

gres

s

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 27

Consolidated Financial Statements

14

Inta

ngib

le a

sset

s

Pa

rtic

ular

sPr

ojec

t roa

dsPr

ojec

t br

idge

sPr

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t be

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Toll

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on

righ

ts

Ope

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ons

&

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ance

ri

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Lice

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fees

T

otal

Refe

r Not

e A

Refe

r Not

e B

Refe

r Not

e C

Refe

r Not

e D

Refe

r Not

e E

Refe

r Not

e F

Cost

or v

alua

tion

As

at A

pril

1, 2

012

5,0

44,9

82,3

12

5,3

92,9

00,4

45

2,2

40,7

49,4

16

9,2

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85

250

,000

,000

1

25,0

00,0

00

22,

254,

302,

558

Addi

tions

7,2

12,8

78,4

87

50,

000,

000

18,

314,

851

71,

091,

570

- -

7,3

52,2

84,9

08

Sale

s/di

spos

als/

adju

stm

ents

- -

- -

- -

- A

s at

Mar

ch 3

1, 2

013

12,

257,

860,

799

5,4

42,9

00,4

45

2,2

59,0

64,2

67

9,2

71,7

61,9

55

250

,000

,000

1

25,0

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587,

466

Addi

tions

- -

- -

- -

- Sa

les/

disp

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just

men

ts -

- -

- -

- -

As

at D

ecem

ber 3

1, 2

013

12,

257,

860,

799

5,4

42,9

00,4

45

2,2

59,0

64,2

67

9,2

71,7

61,9

55

250

,000

,000

12

5,00

0,00

0 2

9,60

6,58

7,46

6 A

mor

tisat

ion

As

at A

pril

1, 2

012

2,4

91,1

30,7

62

187

,708

,604

5

51,9

52,0

99

347

,362

,372

1

09,7

97,6

35

- 3

,687

,951

,472

Ch

arge

for t

he y

ear

746

,050

,901

4

21,6

75,7

12

87,

201,

771

268

,942

,786

1

8,28

2,91

0 -

1,5

42,1

54,0

80

On

sale

/dis

posa

ls/

adju

stm

ents

- -

991

,730

-

- -

991

,730

As

at M

arch

31,

201

3 3

,237

,181

,663

6

09,3

84,3

16

638

,162

,140

6

16,3

05,1

58

128

,080

,545

-

5,2

29,1

13,8

22

Char

ge fo

r the

per

iod

569

,801

,926

2

43,8

44,9

54

65,

436,

769

256

,116

,378

1

3,77

4,79

6 -

1,1

48,9

74,8

23

On

sale

/dis

posa

ls/

adju

stm

ents

- -

- -

- -

As

at D

ecem

ber 3

1, 2

013

3,8

06,9

83,5

89

853

,229

,270

7

03,5

98,9

09

872

,421

,536

1

41,8

55,3

40

- 6

,378

,088

,644

N

et B

lock

As

at M

arch

31,

201

3 9

,020

,679

,136

4

,833

,516

,129

1

,620

,902

,127

8

,655

,456

,797

1

21,9

19,4

55

125,

000,

000

24,

377,

473,

644

As

at D

ecem

ber 3

1, 2

013

8,4

50,8

77,2

10

4,5

89,6

71,1

75

1,5

55,4

65,3

58

8,3

99,3

40,4

19

108

,144

,660

12

5,00

0,00

0 2

3,22

8,49

8,82

2

Not

es:

A

. Pr

ojec

t roa

ds p

erta

ins

to th

e al

l the

cos

ts in

curr

ed b

y th

ree

SPV’

s of

the

Com

pany

, AEL

, REL

and

GIC

L fo

r the

con

stru

ctio

n of

tw

o se

para

te ro

ad h

ighw

ays

unde

r sep

arat

e co

nces

sion

agr

eem

ents

ent

ered

into

bet

wee

n th

e sa

id c

ompa

nies

and

the

NH

AI.

The

se

agre

emen

ts e

ncom

pass

es th

e co

nstr

uctio

n, o

pera

tion

and

mai

nten

ance

of t

he h

ighw

ay o

n a

Build

, Ope

rate

, Tra

nsfe

r (A

nnui

ty) b

asis

. The

ow

ners

hip

of th

e sa

id h

ighw

ay ro

ads

is w

ith th

e G

over

nmen

t of I

ndia

and

the

said

com

pani

es h

ave

an in

tang

ible

righ

t to

rece

ive

half

year

ly a

nnui

ties f

rom

NH

AI u

pto

Nov

embe

r 29,

201

9 fr

om th

e da

te o

f com

men

cem

ent o

f the

com

mer

cial

ope

ratio

ns. T

he re

spec

tive

high

way

road

s dev

elop

ed b

y A

EL a

nd R

EL o

n ce

rtifi

catio

n by

NH

AI,

bega

n co

mm

erci

al o

pera

tions

from

Oct

ober

, 200

4 an

d Se

ptem

ber 2

004

resp

ectiv

ely.

B.

Proj

ect b

ridge

s pe

rtai

ns to

the

cost

s fo

r con

stru

ctio

n of

sep

arat

e b

ridge

pro

ject

s by

the

two

SPVs

’ of t

he C

ompa

ny C

BICL

and

KBI

CL. T

he d

etai

ls a

re a

s un

der :

a)

It

incl

udes

cos

ts in

curr

ed b

y CB

ICL

for c

onst

ruct

ion

of a

road

brid

ge a

cros

s th

e M

atta

nche

rry

river

in C

ochi

n in

the

stat

e of

Ker

ala

as p

er th

e co

nces

sion

agr

eem

ent e

nter

ed in

to b

etw

een

the

said

SPV

and

Gre

ater

Coc

hin

Dev

elop

men

t Aut

horit

y (‘G

CDA’

). Th

is a

gree

men

t enc

ompa

sses

the

cons

truc

tion,

ope

ratio

n an

d m

aint

enan

ce o

f the

sai

d br

idge

on

a Bu

ild, O

pera

te a

nd T

rans

fer (

Toll)

bas

is. T

he o

wne

rshi

p of

the

brid

ge is

with

the

Gov

ernm

ent o

f Ker

ala

and

the

SPV

has

an in

tang

ible

righ

t to

colle

ct to

ll fr

om th

e us

ers

of th

e sa

id b

ridge

upt

o Ju

ne 6

, 202

0 fr

om th

e da

te o

f com

men

cem

ent o

f the

com

mer

cial

ope

ratio

ns. T

he S

PV o

n ce

rtifi

catio

n fr

om G

CDA

com

men

ced

the

com

mer

cial

ope

ratio

ns fr

om S

epte

mbe

r 26,

200

1.

b)

It

incl

udes

cos

ts in

curr

ed b

y KB

ICL

for c

onst

ruct

ion

of a

road

brid

ge a

cros

s th

e Ko

si r

iver

in t

he s

tate

of B

ihar

as

the

conc

essi

on a

gree

men

t en

tere

d in

to b

etw

een

the

said

SPV

and

NH

AI T

his

agre

emen

t en

com

pass

es t

he c

onst

ruct

ion,

ope

ratio

n an

d m

aint

enan

ce o

f the

sai

d br

idge

on

a Bu

ild, O

pera

te a

nd T

rans

fer (

Ann

uity

) bas

is. T

he o

wne

rshi

p of

the

brid

ge is

with

the

Gov

ernm

ent o

f Ind

ia a

nd th

e SP

V ha

s an

inta

ngib

le ri

ght t

o re

ceiv

e ha

lf ye

arly

ann

uitie

s fr

om N

HA

I upt

o A

pril

4, 2

027

from

the

date

of

com

men

cem

ent o

f the

com

mer

cial

ope

ratio

ns. T

he S

PV o

n ce

rtifi

catio

n fr

om N

HA

I com

men

ced

the

com

mer

cial

ope

ratio

ns fr

om F

ebru

ary

8, 2

012.

C.

Proj

ect b

erth

s pe

rtai

ns to

all

the

cost

incu

rred

by

the

SPV

of th

e Co

mpa

ny, V

SPL

for t

he c

onst

ruct

ion

of t

wo

bert

hs a

t Vis

haka

patn

am p

ort,

as p

er th

e co

nces

sion

agr

eem

ent s

igne

d by

the

SPV

with

Viz

ag P

ort T

rust

(‘VP

T’) a

sta

tuto

ry b

ody

gove

rnin

g th

e en

tire

Vish

akap

atna

m p

ort.

The

se a

gree

men

ts e

ncom

pass

es th

e co

nstr

uctio

n, o

pera

tion

and

mai

nten

ance

of t

he tw

o be

rths

on

a Bu

ild, O

pera

te, T

rans

fer b

asis

. The

SPV

is a

llow

ed to

levy

cha

rges

from

the

user

s of t

he b

erth

and

oth

er fa

cilit

ies o

f the

VSP

L fr

om th

e da

te

of c

omm

ence

men

t of t

he c

omm

erci

al o

pera

tions

upt

o N

ovem

ber 2

031.

The

com

mer

cial

ope

ratio

ns o

n ce

rtifi

catio

n by

VPT

com

men

ced

in tw

o ph

ases

, Pha

se 1

from

July

, 200

4 an

d th

e se

cond

pha

se fr

om S

epte

mbe

r, 20

05.

D.

Toll

conc

essi

on r

ight

s pe

rtai

ns t

o th

e co

sts

incu

rred

by

a SP

V of

the

Com

pany

, MN

EL fo

r co

nstr

uctio

n of

a h

ighw

ay r

oad

as p

er t

he c

once

ssio

n ag

reem

ent

sign

ed b

etw

een

MN

EL m

ad N

HA

I. Th

is a

gree

men

t en

com

pass

es t

he c

onst

ruct

ion,

ope

ratio

n an

d m

aint

enan

ce o

f hig

hway

on

a Bu

ild, O

pera

te a

nd M

aint

enan

ce (T

oll)

basi

s. Th

e ow

ners

hip

of th

e sa

id h

ighw

ay ro

ad is

with

the

Gov

ernm

ent o

f Ind

ia a

nd th

e sa

id S

PV h

as a

n in

tang

ible

righ

t to

colle

ct to

ll fr

om th

e us

ers o

f the

road

upt

o th

e ye

ar 2

028

from

the

date

of

the

com

mer

cial

ope

ratio

ns. A

s th

e co

nstr

uctio

n of

the

road

hig

hway

was

com

plet

ed in

two

phas

es, P

hase

1 i

n M

ay 2

010

and

Phas

e 2

in A

ugus

t, 20

11, t

he S

PV b

egan

com

mer

cial

ope

ratio

ns o

f the

road

hig

hway

in tw

o ph

ases

from

the

said

dat

es.

E.

Ope

ratio

ns &

mai

nten

ance

righ

ts in

clud

es u

pfro

nt a

mou

nt p

aid

by th

e Co

mpa

ny to

its h

oldi

ng c

ompa

ny, G

IL, f

or re

visi

on o

f the

term

s of t

he su

b-co

ntra

ct a

gree

men

t sig

ned

betw

een

them

for O

pera

tions

and

Mai

nten

ance

of t

he ro

ad p

roje

ct in

the

stat

e of

And

hra

Prad

esh.

The

sai

d up

fron

t fee

s ha

s be

en c

apita

lised

as

an in

tang

ible

ass

et w

hich

will

be

amor

tised

ove

r the

life

of t

he s

aid

agre

emen

t upt

o N

ovem

ber 2

019.

F. Li

cens

e fe

es p

erta

ins t

o th

e fe

es p

aid

by a

SPV

of t

he C

ompa

ny, I

CTP

L to

Mum

bai P

ort T

rust

(‘M

bPT’

) as p

er th

e co

nces

sion

agr

eem

ent s

igne

d be

twee

n th

em fo

r pro

vidi

ng th

e lic

ense

to c

onst

ruct

, ope

rate

and

mai

ntai

n a

offsh

ore

cont

aine

r ter

min

al in

the

Mum

bai

Port

. The

sai

d in

tang

ible

will

pro

vide

the

right

to th

e SP

V to

cha

rge

the

user

s of

the

offsh

ore

cont

aine

r ter

min

al w

hen

it co

mm

ence

s op

erat

ions

. The

inta

ngib

le w

ill b

e am

ortis

ed fr

om th

e da

te th

e co

mm

erci

al o

pera

tions

com

men

ces.

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 28

Consolidated Financial Statements

15 Capital work-in-progress

Particulars As at December 31, 2013

As atMarch 31, 2013

Expenses incurred on construction, acquisition of self owned asset : 68,451,652 53,255,902 Borrowing costs 16,291,912 15,007,057 Employee benefit expenses 9,199,769 6,643,967 Other expenses 34,044,459 32,855,934 Depreciation 231,217 167,551

128,219,009 107,930,411 Less : Capital work-in-progress written off 1,074,513 1,074,513 Total capital work-in-progress 127,144,496 106,855,898

16 Intangible assets under development

Particulars As at December 31, 2013

As at March 31, 2013

Contract expenditure 17,974,184,299 21,007,854,599 Developer fees 997,425,038 1,406,629,964 Concession fees 97,837,335 53,617,905 Borrowing costs 4,617,651,118 4,641,295,795 Employee benefit expenses 159,955,421 104,295,516 Other expenses 607,297,804 549,615,611 Depreciation 3,209,458 2,446,766

24,457,560,473 27,765,756,156 Less :Miscellaneous income 6,958,962 7,551,717

24,450,601,511 27,758,204,439 Less : Capitalised during the period 7,116,539 7,291,139,096 Total intangible assets under development 24,443,484,972 20,467,065,343

17 Goodwill on consolidation

Particulars As at December 31, 2013

As at March 31, 2013

Goodwill on consolidation 701,275,173 620,620,849 Less : Capital reserve on consolidation 163,895,788 163,895,788 Net of goodwill over capital reserve 537,379,385 456,725,061 Goodwill amortised upto September 30, 2007 3,729,475 3,729,475 Total goodwill on consolidation 533,649,910 452,995,586

Goodwill which was amortised upto September 30, 2007 is now tested for impairment at the end of every reporting period.

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 29

Consolidated Financial Statements

18 Non-current investments

Particulars As at December

31, 2013Nos

As at March

31, 2013Nos

As at December

31, 2013`

As at March

31, 2013`

Trade investments in associates (Unquoted ordinary equity shares of `10 each, unless otherwise stated)ESMSPL 2,143,950 2,143,950 13,114,517 14,284,420 Mordern Tollroads Limited 24,470 24,470 184,113 192,248 AIPL 24,450 24,450 178,601 178,601

13,477,231 14,655,269 Less : Provision for diminution in value of investment 5,552,366 5,552,366 Total non-current investments 7,924,865 9,102,903

Carrying amount of investments in associate companies :

ESMSPL Modern Tollroads Limited AIPL*

Particulars December 31, 2013

March 31, 2013

December 31, 2013

March 31, 2013

December 31, 2013

March 31, 2013

Original cost of investment 21,439,500 21,439,500 244,700 244,700 244,500 244,500 Add :Opening balance of accumulated losses (7,155,080) (7,543,266) (52,452) (41,088) (65,899) (61,054)Add : Profit/(Losses) during the period 177,403 110,300 (8,135) (11,364) - (4,845)Add : Adjustments during the period (1,347,306) 277,886 Closing balance of accumulated losses

(8,324,983) (7,155,080) (60,587) (52,452) (65,899) (65,899)

Carrying amount of investment 13,114,517 14,284,420 184,113 192,248 178,601 178,601

* Based on the un-audited management accounts for the period ended December 31, 2013.

19 Loans and advances :

Unsecured, considered good unless stated otherwise

As atDecember 31, 2013

As at March 31, 2013

Particulars Non-current Current Non-current CurrentCapital advances to related parties:-

Gammon India Limited 305,928,858 - 450,143,009 - Gammon Power Limited 20,000,000 20,000,000

to Others (refer note (a) below) 795,956,356 - 964,547,244 - (A) 1,121,885,214 - 1,434,690,253 -

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 30

Consolidated Financial Statements

As atDecember 31, 2013

As at March 31, 2013

Non-current Current Non-current CurrentDepositsSecurity deposits 19,993,772 213,537 15,433,493 1,234,399 Other deposits 5,999,100 473,060 10,227,729 127,500

(B) 25,992,872 686,597 25,661,222 1,361,899 Advance recoverable in cash or in kind from related parties (refer note (b) below) 46,827,118 84,293,601 - 33,507,286 from others 96,385,819 188,498,286 91,503,662 187,940,694 Considered doubtful 3,871,308 - 3,626,704 -

147,084,245 272,791,887 95,130,366 221,447,980 Less : Provision made towards doubtful advances (3,871,308) (3,626,704)

(C ) 143,212,937 272,791,887 91,503,662 221,447,980 Intercorporate loans given to related parties

- ICTPL 60,975,643 - 30,513,248 - - GIL 1,073,466 1,073,466

Others 40,999,987 200,000,000 63,077,498 - Considered doubtful 3,892,000 3,892,000

106,941,096 200,000,000 98,556,212 - Provision for doubtful deposits (3,892,000) - (3,892,000) -

(D) 103,049,096 200,000,000 94,664,212 - Advance income-tax, net of tax provision (E) 398,041,469 - 266,434,011 - MAT credit entitlement (refer note (c) below) (F) 218,638,006 - 195,235,847 - Advance towards equity commitmentRelated party - Mordern Toll roads 12,994,800 - 12,994,800 - Advance for purchase of shares 88,909,787 168,183,126

(G) 101,904,587 - 181,177,926 - Other loans and advancesCenvat/VAT/Service tax recoverable 25,000 46,156,944 25,000 47,702,411 Prepaid expenses 5,619,652 37,077,642 18,326,520 64,980,469

(H) 5,644,652 83,234,586 18,351,520 112,682,880 Total Loans and Advances (A + B + C + D + E + F + G + H)

2,118,368,833 556,713,070 2,307,718,653 335,492,759

a. During the period, some of the Group Companies have entered into an agreement for cancellation of purchase of

land. An amount of ` 450,000,000 is receivable towards this cancellation by the Group over a period of 15 months.

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 31

Consolidated Financial Statements

b. Dues from related parties :

As atDecember 31, 2013

As at March 31, 2013

Particulars Non-current Current Non-current CurrentGIL 46,827,118 84,227,325 - 30,288,938 ICTPL - - 3,155,077 GIPL - GIL JV - 18,005 - - MDEPL - - - 15,000 Modern Tollroads Limited - 48,271 - 48,271

46,827,118 84,293,601 - 33,507,286

c. Some of the eligible SPVs’ of the Group have availed the tax holiday period under section 80 IA of the Income-tax Act, 1962. As such the eligible SPVs’ Group during this period of tax holiday have to pay the Minimum Alternate Tax (‘MAT’) based on the profits as per their profits in the financial statements during the tax holiday period. The MAT paid by these SPVs during the said tax holiday period is available for adjustment against the normal tax payable by the said SPVs after the tax holiday period. The total amount of MAT credit entitlement to these SPVs is `218,638,006 (Previous year : ` 195,235,847).

20 Trade receivables Unsecured, considered good unless stated otherwise

As atDecember 31, 2013

As at March 31, 2013

Particulars Non-current Current Non-current CurrentOutstanding for a period exceeding six months from thedate they are due for paymentFrom related party - GIL - 8,261,111 - 8,261,111 From others - considered good (refer note 38) 163,066,739 13,761,284 558,704 185,051,167 - considered doubtful - 3,306,087 21,013,096 1,834,688

163,066,739 25,328,482 21,571,800 195,146,966 Less : Provision for doubtful debts - (3,306,087) (21,013,096) (1,834,688)

163,066,739 22,022,395 558,704 193,312,278 Other receivablesFrom related parties - GIL - - - 41,556,772 - MDEPL - - - 14,938,360 From others - 157,700,516 - 128,641,529

- 157,700,516 - 185,136,661 Total trade receivables 163,066,739 179,722,911 558,704 378,448,939

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 32

Consolidated Financial Statements

21 Other assets Unsecured, considered good unless stated otherwise

As atDecember 31, 2013

As at March 31, 2013

Particulars Non-current Current Non-current CurrentAccrued income - 622,192,461 - 1,409,425,533 Balances in escrow bank accounts (Refer note 24) 55,059,203 132,048,600 151,055,327 151,677,578

(A) 55,059,203 754,241,061 151,055,327 1,561,103,111 Interest accrued receivableConsidered good :Related parties GIL 743,290 - 594,888 - ICTPL 11,251,625 1,621,782 Others 53,189,615 11,070,554 - 65,422,801 Considered doubtful - 692,183 - 692,183

65,184,530 11,762,737 2,216,670 66,114,984 Less : Provision made - (692,183) - (692,183)

(B) 65,184,530 11,070,554 2,216,670 65,422,801 Total other assets (A + B) 120,243,733 765,311,615 153,271,997 1,626,525,912

a. Accrued income includes amounts of `493,358,653 (Previous year : `1,174,884,534) receivable from NHAI against the annuities, `123,374,488 (Previous year : `219,460,403) towards grant from NHAI, `5,459,320 (Previous year : `11,409,681) from a client and balance from others. These are unbilled revenues accrued as on December 31, 2013 to the SPVs of the Group.

b. Balances in escrow bank accounts includes an amount of `33,505 (Previous year : `33,505) of the Initial Public Offer, made by the holding company of the Group, pertains to the refund orders not encashed by the investors. This amount is transferrable to Investors Protection Fund in the year 2015.

22 Current investments

Particulars As at December

31, 2013Nos

As at March

31, 2013Nos

As at December

31, 2013`

As at March

31, 2013`

Non-trade investments (valued at cost unless otherwise stated )Investment in mutual fundBirla Mutual Fund - Growth schemes 251,692.71 40,834.46 50,296,183 8,500,000 Birla Mutual Fund - Growth schemes 307,014.99 45,638.52 61,351,315 9,500,000 Axis Liquid Fund - Daily Dividend Reinvestment 18,741.35 9,184,279 ICICI Prudential Liquid - Regular Plan - Growth 414,339.02 - 75,830,587 - Trade investments (valued at cost unless otherwise stated)Investment in equity shares ofMaa Durga Expressway Private Limited 4,900,000 - 49,000,000 - Total current investments 5,873,046.72 105,214.33 236,478,084 27,184,279 Market value as at December 31, 2013 189,281,797 28,514,778

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 33

Consolidated Financial Statements

23 Inventories

Particulars As atDecember 31, 2013

As at March 31, 2013

Raw material 17,845,487 9,105,231 Stores and consumables 35,290,326 34,276,795 (at lower of cost computed at weighted average rate and net realisable value)Scrap steel - 7,107,060 Construction work in progress (EPC) (refer note below) 62,250,734 12,635,202 Total inventories 115,386,547 63,124,288

The disclosures as per provisions of Clauses 38, 39 and 41 of Accounting Standard - 7 ‘Construction Contracts’ notified by the Companies (Accounting Standards) Rules’ 2006, (as amended) are as under:

Particulars As atDecember 31, 2013

As at March 31, 2013

Turnover for the period 103,882,507 - Aggregate Expenditure (Net of inventory adjustments) for contracts existing as at the period end,

103,882,507 12,635,202

Aggregate Contract Profits/Losses recognized for contracts existing as at the period end,

- -

Contract Advances (Net) 3,163,685,465 822,550,263 Gross Amount due from Customers for contract work 103,882,507 - Gross Amount due to customers for contract work - -

24 Cash and bank balances

As atDecember 31, 2013

As at March 31, 2013

Particulars Non-current Current Non-current CurrentCash and cash equivalentsBalances with Scheduled Banks :in Current Accounts - 801,088,759 - 568,659,619 Cash on hand - 6,352,453 - 10,593,736 Cheques on hand - 4,445,908 - 93,400 Fixed Deposit with banks for a period less than three months - 65,000,000 - 113,149,515

- 876,887,120 - 692,496,270 Other bank balancesBalances in escrow account 43,045 - 33,505 - Debt service reserve account 73,500,001 101,021,822 - Fixed Deposit with banks for a period exceeding three months - 132,048,600 - 151,677,578 Fixed Deposit under lien (refer note 11) 55,016,158 - 50,000,000 - Amounts disclosed under Other assets (Refer note 21) (55,059,203) (132,048,600) (151,055,327) (151,677,578)

- 73,500,001 - - Total Cash and bank balances - 950,387,121 - 692,496,270

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 34

Consolidated Financial Statements

25 Revenue from projects

Particulars Period ended December 31, 2013

Year ended March 31, 2013

Annuity income 2,084,199,931 3,001,808,697 Toll revenue 962,711,059 1,339,611,301 Revenue from advisory activities - 59,271,844 Revenue from port operations 863,049,782 1,350,898,363 Revenue from road maintenance 152,306,852 193,567,860 Revenue from developer activities 221,691,820 676,777,051 Revenue from Contract income (refer note 23) 129,277,409 - Total revenue from projects 4,413,236,853 6,621,935,116

The Group undertakes various projects on build-operate-transfer basis as per the service concession agreements with the government authorities. During the current period, expenses on construction activity and developer fees incurred by the operator on the project with the Group were considered as exchanged with the grantor against toll collection / annuity rights from such agreements and therefore the revenue from such contracts were considered realised by the Group and not eliminated for consolidation under AS-21 Consolidated Financial Statements. The revenue during the current year from such contracts are not eliminated to the extent of `350,969,229 (previous year : ` 676,777,051).

During the previous year, one of the SPV had received bunched up annuity amounting to ` 223,125,683 on account of the delay caused not on account of the SPV. The SPV has amortised the intangible asset proportionately for the portion related to the bunched up annuity.

26 Other operating revenue

Particulars Period ended December 31, 2013

Year ended March 31, 2013

Operating grant received 105,384,852 206,201,653 Income from change of scope 2,804,190 38,528,735 Others 20,354,116 37,101,870

Total other operating revenue 128,543,158 281,832,258

27 Other income

Particulars Period ended December 31, 2013

Year ended March 31, 2013

Interest income on :Intercorporate deposits 6,589,933 7,160,901 Bank deposits 26,375,710 33,104,480 Others 297,408 6,403,787

33,263,051 46,669,168 Miscellaneous income :Net gain on sale of current investments 21,766,577 25,012,560 Others 9,780,882 5,943,260

31,547,459 30,955,820 Total other income 64,810,510 77,624,988

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 35

Consolidated Financial Statements

28 Project expenses

Particulars Period ended December 31, 2013

Year ended March 31, 2013

Changes in inventory of materials used in maintenance activities :Opening stock of materials 4,208,978 4,440,914 Less : Closing stock of materials 62,650,488 4,208,978

(58,441,510) 231,936 Sub-contracting expenses 386,412,391 352,814,240 Expenses towards change of scope - 38,528,735 Material handling system's maintenance expenses (refer note 43) 149,439,971 117,098,647 Port cargo handling expenses 266,963,356 471,088,122 Power and fuel expenses 39,295,455 50,589,268 Royalty on revenue 41,173,289 65,385,870 Penalty on shortfall of minimum guarantee throughput - 11,295,732 Other project expenses 109,859,434 113,044,015 Periodic maintenance expenses 375,313,000 441,869,728 1,368,456,896 1,661,714,357 Total project expenses 1,310,015,386 1,661,946,293

29 Employee benefits expense

Particulars Period ended December 31, 2013

Year ended March 31, 2013

Salaries, wages and bonus 184,536,529 209,859,947 Contributions to provident fund 6,517,847 8,626,209 Directors' remuneration including contributions to provident fund (refer note 40)

35,886,014 51,145,954

Staff welfare expenses 6,747,845 10,340,638 Provision for leave encashment 8,147,371 6,568,249 Provision for gratuity (refer note 10(a)) 978,727 1,946,917 Employees 'ESOP' compensation cost 2,456,974 (3,519,002)Cash alternative settlement of ESOP scheme (refer note 10(b)) (1,741,294) 4,285,167 Total employee benefits expense 243,530,013 289,254,079

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 36

Consolidated Financial Statements

30 Other expenses

Particulars Period ended December 31, 2013

Year ended March 31, 2013

Professional and consultancy fees (refer note 46) 54,015,919 89,732,227 Insurance charges 15,442,686 5,290,311 Directors' fees and commission 1,971,236 830,000 Office rent 11,320,145 13,784,347 Hire of equipments 4,089,086 3,971,430 Fuel charges 5,894,197 2,799,461 Travelling and motor car expenses (refer note 43) 15,038,970 24,287,028 Tender document expenses 992,865 15,525,626 Payment to auditors 8,912,987 8,402,608 Preliminary and share issue expenses - 30,339 Guarantee bond commission 2,423,281 4,412,226 Miscellaneous expenses 50,009,700 46,355,716 Assets written off 3,271,896 9,914,535 Loss on sale of fixed assets 2,547,796 5,860,832 Loss from joint venture* 18,647,964 39,945,070 Loss on foreign currency fluctuation - 1,802,716 Intangible asset written off - 5,575,701 Provision for doubtful debts, advances & bad debts 20,007,812 458,495

214,586,540 278,978,668 Less : Transfer to intangible asset under development - - Total other expenses 214,586,540 278,978,668

* Pursuant to supplementary agreement dated December 23, 2011 with Noatum Ports S.L., co-venturer in ICTPL, the group

is liable to bear and discharge all financial obligation and contribution in relation to ICTPL. Hence the entire loss of ICTPL has been absorbed by the Group.

31 Finance costs

Particulars Period ended December 31, 2013

Year ended March 31, 2013

Interest expense- to banks, financial institution and others 2,133,231,440 2,877,147,413 - to related parties- GIL on intercorporate loans - 37,050,612 - ICTPL on margin money 452,055 300,000 - to joint venture partners - 14,126,965 Other finance costs 56,603,381 39,712,593 Total finance cost 2,190,286,876 2,968,337,583

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 37

Consolidated Financial Statements

32 Earnings per share (EPS)

Particulars Period endedDecember 31, 2013

Year ended March 31, 2013

Profit/(loss) after tax (564,438,626) 147,263,253 Outstanding equity shares at the end of the period 734,026,438 734,026,438 Weighted average number of equity shares outstanding during the period - Basic 734,026,438 734,026,438 Weighted average number of equity shares outstanding during the period - Diluted 737,781,732 734,180,933 Earnings Per Share - Basic (`) (0.77) 0.20 Earnings Per Share - Diluted (`) *(0.77) 0.20 * The EPS on dilutive basis is anti-dilutive and therefore it is same as basic EPS.

Particulars As atDecember 31, 2013

As at March 31, 2013

Nominal value of equity shares (`per share) 2 2 For Basic EPS :Total number of equity shares outstanding at the beginning of the period 734,026,438 728,763,618 Add : Issue of equity shares against options granted to employees - - Add : Issue of Bonus Shares during the period - 5,262,820 Total number of equity shares outstanding at the end of period 734,026,438 734,026,438 Weighted average number of equity shares at the end of the period 734,026,438 734,026,438 For Dilutive EPS :Weighted average number of shares used in calculating basic EPS 734,026,438 734,026,438 Add : Equity shares for no consideration arising on grant of stock options under ESOP

4,348,235 3,565,448

Less : Equity shares for no consideration arising on grant of stock options under ESOP forfeited / lapsed (included above)

592,941 3,410,953

Weighted average number of equity shares used in calculating diluted EPS 737,781,732 734,180,933

33 Significant accounting policies and notes to this consolidated financial statement are intended to serve as a means of informative disclosure and a guide to better understanding the consolidated position of the companies. Recognising this purpose, the Group has disclosed only such policies and notes from the individual financial statements, which fairly presents the needed disclosures.

34 As on December 31, 2013, current liabilities exceed current assets by ` 6,089,713,519. The Group is taking various steps

to meet its commitments, both, short term and long term in nature. The Group is actively pursuing various payments from the client including bonuses, grants, and claims for its projects. Subsequent to the Balance Sheet Date, in one such case, it has received such bonus payment amounting to `673,444,444. Further the Group intends to monetize some of its mature assets, as well as securitize some of its future receivables. The Group is in active discussions with various lenders for raising additional long term debts. The Group will also generate contracting income and developer fees out of the new projects that it has been awarded. Based on detailed evaluation of the current situation, plans formulated and active discussions underway with various stakeholders, management is confident that the going concern assumption and the carrying values of the assets and liabilities in these financial statements are appropriate. Accordingly the accompanying financial statements do not include any adjustments that may result from these uncertainties.

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 38

Consolidated Financial Statements

35 During the current period two wholly owned subsidiaries of the Group have initiated correspondence with NHAI for closure of its projects viz. Birmitrapur to Barkote of NH-23 and Yamunanagar to Panchkula of NH-73 on mutually acceptable terms on account NHAI’s inability to fulfill conditions precedent due to non-availability of Right of Way to the Site and non-receipt of Environment and Forest Clearances. The group’s exposure to these two projects includes expenditure towards projects of ` 406,881,213 and guarantees of ` 389,100,000. The closure is subject to confirmation by NHAI and involves a process of discussions and settlement between the Company and NHAI to determine the terms of closure or continuance of the project, pending which, no adjustments have been made in the financial statements.

36 Pravara Renewable Energy Limited (PREL - a wholly owned subsidiary of the Company) has filed the requisite petition in the Hon. Bombay High Court for approval of the Scheme for its merger with the Company. Pending the approval of the Hon. Bombay High Court the above results do not contain any effect of the Scheme of the merger.

37 Subsequent to the end of the period, one of the subsidiaries of the Company namely Kosi Bridge Infrastructure Company Limited has received an amount from National Highways Authority of India (‘NHAI’) approving a bonus of ` 6,73,444,444, which will be accounted in the period in which it is received along with related expenditure.

38 Under the Concession Agreement dated 27th October, 1999, executed between CBICL, GIL the holding company of the Group, Government of Kerala (GOK) and Greater Cochin Development Authority (GCDA) dated January 6th, 2001; the entire project has been assigned to CBICL as a Concessionaire for the purpose of developing, operating and maintaining the infrastructure facility on BOT basis for 13 years and nine months.

Subsequently, a Supplementary Concession Agreement was to be executed as per the Government of Kerala’s Order Nos. G.O. (M.S.) No. 11/2005/PWD dated 24th January, 2005 and G.O. (M.S) No. 16/2005/PWD dated 1st March, 2005 between the Government of Kerala, Greater Cochin Development Authority and CBICL. In terms of the order, the period of concession has been increased by 6 years and CBICL is entitled to yearly annuity receipts of ` 15,400,000 which it is accounting as Trade receivables. The annuities have not been collected till date and in respect of which CBICL has initiated arbitration procedures. CBICL has not made any provision against the said receivables as it is confident of receiving a favourable award.

39 Lease One of the SPV has taken land on lease from Visakhapatnam Port Trust under non-cancellable operating lease agreements

and temporary housing from others under cancellable operating lease agreements. Total rental expense under non-cancellable operating lease was ` 4,407,974 (Previous year: ` 9,210,235) and under cancellable operating leases was ` 698,774 (Previous year: ` 818,810) which has been disclosed as lease rentals in the statement of profit and loss.

Further, another SPV has also taken an office premises on a non-cancellable operating lease. The monthly lease rents amounts to ` 950,000 (Previous year : ` 950,000). The disclosures as per Accounting Standard 19 ‘Leases’ notified under the Companies (Accounting Standards) Rules, 2006 are as under:

Particulars December 31, 2013 March 31, 2013Minimum lease payments :Payable not later than 1 year 13,110,000 12,084,000 Payable later than 1 year and not later than 5 years 13,110,000 34,086,000 Payable later than 5 years - - Lease payment recognised in the statement of profit and loss 905,026 1,299,713

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 39

Consolidated Financial Statements

40 Related party transactions a. Names of the related parties and related party relationships i) Entities where control exists : GIL the holding company

ii) Fellow subsidiary : GPL ACBIPL

iii) Associates : AIAIPL ESMSPL MTRL

iv) Key management personnel : Abhijit Rajan Kishor Kumar Mohanty Parag Parikh Rajeevkumar Malhotra (upto May 7, 2013)

b. Related party transactions

Transactions Entities where control

exists Associates Fellow

subsidiary Key

management personnel

Total

Operations and maintenance income from :GIL 152,306,852 152,306,852

(192,104,620) (192,104,620)Operations & maintenance expenses :GIL 152,307,391 152,307,391

(192,068,481) (192,068,481)Intangible asset development (materials supply) :GIL 9,409,768 9,409,768

(105,298,277) (105,298,277)Intangible asset development (contract expenditure) :GIL 1,969,933,581 1,969,933,581

(2,936,192,456) (2,936,192,456)Advances given against EPC contracts to : GIL 95,885,982 95,885,982

(112,311,912) (112,311,912)Advances recovered against EPC contracts from :GIL - -

(204,859,918) (204,859,918)Advance against labour recovered :GIL - -

(135,000,000) (135,000,000)Advance against material supply recovered :GIL - -

(124,915,434) (124,915,434)Insurance claims transferred to : GIL - -

(1,626,398) (1,626,398)

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 40

Consolidated Financial Statements

Transactions Entities where control

exists Associates Fellow

subsidiary Key

management personnel

Total

Managerial remuneration :- Mr. Kishor Kumar Mohanty 19,037,738 19,037,738

(25,845,378) (25,845,378)- Mr. Parag Parikh 7,943,859 7,943,859 (16,999,844) (16,999,844)- Mr. R.K. Malhotra 804,417 804,417

(8,300,732) (8,300,732)ESOP Compensation Cost:

- Mr. Kishor Kumar Mohanty 12,000,000 12,000,000 - -

- Mr. Parag Parikh 19,200,000 19,200,000 - - Bonus shares issued (no. of shares):

- Mr. Abhijit Rajan - - (836,602) (836,602)

- Mr. K. K. Mohanty - - (2,956) (2,956)

- Mr. R. K. Malhotra - - (2,648) (2,648)

- Mr. Parag Parikh - - (7,206) (7,206)

Loans given to:GIL - -

(750,000,000) (750,000,000)Refund of loans given to:GIL - -

(748,926,534) (748,926,534)Finance provided for expenses and on account payments :GIL 9,345,465 9,345,465

(7,696,902) (7,696,902)Intercorporate borrowings from :GIL - -

(190,000,000) (190,000,000)Finance received for expenses & on account payments :GIL 96,400 96,400

(1,022,507) (1,022,507)Refund of intercorporate borrowings to :GIL - -

(926,404,066) (926,404,066)Interest income during the period :GIL - -

(936,986) (936,986)

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 41

Consolidated Financial Statements

Transactions Entities where control

exists Associates Fellow

subsidiary Key

management personnel

Total

Interest paid during the year to :GIL - -

(37,050,612) (37,050,612)Retention money recovered / recovered:GIL - -

(14,843,554) (14,843,554)Intercorporate borrowings including interest to :ESMSPL 11,381,886 11,381,886

(7,632,997) (7,632,997)Outstanding balances receivable :

- Modern Tollroads Limited 13,043,071 13,043,071 (13,043,071) (13,043,071)

- Gammon Power Limited 20,000,000 20,000,000 (20,000,000) (20,000,000)

- "Eversun Sparkle Maritime Services Private Limited" 9,321,195 9,321,195 (18,077,498) (18,077,498)

Outstanding balances payable :- GIL 1,152,068,381 1,152,068,381

(671,356,789) (671,356,789)- Modern Tollroads Limited 26,520,000 26,520,000

(26,520,000) (26,520,000)- ACBIPL 150,000,000 150,000,000

(150,000,000) (150,000,000)

(Previous year’s figures in brackets)

41 Contingent liabilities

Group’s share in contingent liability not provided for in the books of accounts.

Particulars As atDecember 31, 2013

As at March 31, 2013

Income tax matters (refer note (a) below) 764,913,874 756,113,922 Disputed statutory liabilities (refer note (b) below) 177,699,900 177,699,900 Claims against group not acknowledged as debt (refer note (c) below) 113,129,410 1,017,672,971 Counter guarantees given to the bankers 3,748,060,200 2,964,822,400 Total 4,803,803,384 4,916,309,193

a. During the previous year, some of the subsidiaries of the Group has received block assessment orders raising demand u/s 143(3) read with section 153(A) of the Income Tax Act, 1961 for assessment years from 2005-06 to 2011-12 totalling to ` 764,913,874 (Previous year: ` 7,561,139,22). The subsidiaries of the Group are of the view that the said Orders are unjustified and unsustainable and hence is in the process of filing appeals against the said assessment Orders with the Commissioner of Income-Tax (Appeals). Since the subsidiaries of the Group proposes to appeal against these orders, they believe that no liability will ultimately result from these and accordingly no provision has been made in these financial statements in respect of these amounts.

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 42

Consolidated Financial Statements

b. An amount of `177,699,900 claimed by the collector and district registrar, Rajahmundry, pursuant to and Order dated March 15, 2005, as deficit stamp duty payable on the concession agreement entered into between a subsidiary of the Group and NHAI, classifying the concession agreement as a ‘lease’ under Article 31(d) of the Indian Stamp Act. The subsidiary has impugned the Order by way of a writ petition before the High Court of Andhra Pradesh at Hyderabad. No provision is considered necessary in respect of the said demand, as the management of the subsidiary believes that there is no contravention of the Indian Stamp Act.

c. Claims against the SPVs of the group not acknowledge as debt includes: A winding up petition against a subsidiary of the Group, has been filed by a creditor for recovery of `14,140,343. The subsidiary is disputing the said amount and has recognised `1,685,168 payable as there are claims and counter claims by both parties. Pending the final outcome of such proceeding, the claim from the trade payable is disclosed as a contingent liability. The management of the said is of the view that the same would be settled and does not expect any additional liabilities towards the same.

42 Commitments

a. Capital commitments The total capital commitment as on December 31, 2013 is `78,818,258,937 (Previous year :`76,437,229,519).The

capital commitments are in respect of projects where the concession agreements have been signed and does not include projects where only Letters of Intents are held.

b. Export obligations

Particulars As at December 31, 2013

As at March 31, 2013

Under EPCG Scheme 228,966,912 228,966,912 Total 228,966,912 228,966,912

c. Other commitments

i) In terms of the individual contracts signed by SPVs they are required to carry major periodic maintenance of the roads they are operating as a part of commitment against receipt of Tolling Rights and / or Annuities. The said SPVs have made provisions towards the same in their respective financial statements.

ii) One of the SPV’s engaged in generating power from a bagasse power plant has committed to purchase bagasse when the power plant becomes operational. The total commitment to purchase the bagasse upto December 31, 2013 is `65,000,000 (Previous year :`65,000,000).

iii) Buyback / purchase of shares of subsidiaries ` 1,314,733,521 (previous year ` 1,288,048,291)

43 Expenditure in foreign currency

Particulars Period ended December 31, 2013

As at March 31, 2013

Technical services (net of taxes) 14,648,451 31,722,827 Travelling expenses 26,519 46,130 Total 14,674,970 31,768,957

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 43

Consolidated Financial Statements

44 Dividend remittance in foreign currency

Particulars Period ended December 31, 2013

As at March 31, 2013

Year to which the dividend relates 2012-13 - Amount remitted during the period 22,877,417 - Number of non-resident shareholders - - Number of shares on which dividend was due 22,877,417 -

45 Segment reporting The Group’s operations constitutes a single business segment namely “Infrastructure Development” as per Accounting Standard

(AS) - 17 “Segment Reporting”. Further the Group’s operations are within single geographical segment which is India.

Infrastructure activities comprise of all the activities of investing in infrastructure projects, providing advisory services and operating and maintaining of Public Private Partnership Infrastructure Projects.

46 Remuneration to auditors of the subsidiaries and joint ventures not audited by any of the joint auditors of the Company is grouped with professional fees.

47 Prior Period comparatives Current period’s figures are for the period from April 1, 2013 to December 31, 2013 and that of previous year are for the

period from April 1, 2012 to March 31, 2013. Therefore, the figures for the current period are not comparable with those of the previous year, however previous year’s figures have been regrouped and rearranged wherever necessary to conform to this period’s classification.

As per our report of even date For and on behalf of the Board of Directors of Gammon Infrastructure Projects Limited

For Natvarlal Vepari & Co. For S. R. Batliboi & Co. LLP Kishor Kumar Mohanty Parag ParikhICAI Firm Regn. No.: 106971W ICAI Firm Regn. No. : 301003E Managing Director Whole-time Director and CFO Chartered Accountants Chartered Accountants

N Jayendran per Hemal Shah Abhijit Rajan C. C. Dayal Partner Partner Director Director Membership No. : 40441 Membership No. : 42650 Homai A. Daruwalla G. Sathis Chandran Director Company Secretary

Place : Mumbai Place : MumbaiDate : March 1, 2014 Date : March 1, 2014

Notesto the Consolidated financial statements tor the period from April 1, 2013 to December 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 44

Consolidated Financial Statements

Independent Auditor’s Report

The Board of Directors Gammon Infrastructure Projects Limited

Report on Consolidated Financial StatementsWe have audited the accompanying consolidated �nancial statements of Gammon Infrastructure Projects Limited (‘GIPL’ or ‘the Company’) and its subsidiaries, Jointly Controlled Entities and Associates (GIPL Group), which comprise the consolidated Balance Sheet as at 31st March 2013, and the consolidated Statement of Pro�t and Loss and the consolidated Cash Flow Statement for the year then ended, and a summary of signi�cant accounting policies and other explanatory information.

Management’s Responsibility for the Consolidated Financial StatementsManagement is responsible for the preparation of these consolidated �nancial statements that give a true and fair view of the consolidated �nancial position, consolidated �nancial performance and consolidated cash �ows of the Company in accordance with accounting principles generally accepted in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the consolidated �nancial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor’s ResponsibilityOur responsibility is to express an opinion on these consolidated �nancial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated �nancial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated �nancial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the consolidated �nancial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company’s preparation and presentation of the consolidated �nancial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the consolidated �nancial statements. We believe that the audit evidence we have obtained is su�cient and appropriate to provide a basis for our audit opinion.

OpinionIn our opinion and to the best of our information and according to the explanations given to us, the consolidated �nancial statements give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) in the case of the consolidated Balance Sheet, of the state of a�airs of the GIPL Group as at 31st March, 2013;(b) in the case of the consolidated Statement of Pro�t and Loss, of the pro�t of the GIPL Group for the year ended on that date; and (c) in the case of the consolidated Cash Flow Statement, of the cash �ows of the GIPL Group for the year ended on that date.

Other Mattera. We did not audit the �nancial statements of certain subsidiaries whose �nancial statements re�ect total assets of ` 16,111,566,964 as at

March 31, 2013, total income of ` 1,572,435,188 and cash �ows of ` -1,859,503,707 for the year ended;

b. certain joint venture companies whose �nancial statements re�ect total assets of ` 242,603,012 as at March 31, 2013 and cash �ows amounting to ̀ -16,786 for the year then ended, the Company’s share of such assets and total cash �ows being ̀ 118,850,985 and ̀ -2,045, respectively; and

c. certain associates whose �nancial statements re�ect a total pro�t of ` 323,876 for the year ended March 31, 2013, the Company’s share in the pro�t of such associates being ` 94,091.

The above mentioned �nancial statements have been audited by other auditors whose reports have been furnished to us, and our opinion is based solely on the report of other auditors except for the �nancial statements of joint ventures and associates referred to in point 3 (b) and (c) above, which are based on unaudited �nancial statements certi�ed by the respective managements of the said joint ventures whose �nancial statements re�ect total assets of ` 242,603,012 as at March 31, 2013 and cash �ows of ` -16,786 for the year then ended, the Company’s share of such assets and cash �ows being ` 118,850,985 and ` -2,045 respectively and the said associates whose �nancial statements re�ect a total pro�t of ` 323,876 for the year ended March 31, 2013, the Company’s share in the loss of such associates being ` 94,091.

In respect of the other subsidiaries and Joint Ventures, the audit has been conducted by either of us and the audit of GIPL has been conducted by us jointly.

For Natvarlal Vepari & Co. For S.R. Batliboi & Co. LLPICAI Firm Registration Number:106971W ICAI Firm Registration Number : 301003E Chartered Accountants Chartered Accountants

N Jayendran per Hemal ShahM. No. 40441 M. No. 42650Partner PartnerMumbai, Dated : May 24, 2013 Mumbai, Dated : May 24, 2013

F - 45

Consolidated Financial Statements

Consolidated Balance Sheetas at March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

Particulars Notes As at March 31, 2013

As at March 31, 2012

Equity and liabilitiesShareholders' fundsShare capital 4 1,476,155,376 1,465,629,736 Reserves and surplus 5 5,650,993,240 5,984,247,424

7,127,148,616 7,449,877,160 Minority interest 6 1,801,958,234 1,219,772,941 Non-current liabilitiesLong-term borrowings 7 36,117,195,795 30,388,521,028 Deferred tax liabilities (net) 8 20,837,532 25,644,794 Other long-term liabilities 9 8,850,000 8,850,000 Long-term provisions 10 750,244,309 299,201,125

36,897,127,636 30,722,216,947 Current liabilitiesShort-term borrowings 11 787,812,481 1,936,200,000 Trade payables, current 12 242,379,703 112,339,462 Other current liabilities 12 5,426,881,971 6,240,012,715 Short-term provisions 10 243,301,926 129,170,460

6,700,376,081 8,417,722,637 TOTAL 52,526,610,567 47,809,589,685 AssetsNon-current assetsFixed assets : Tangible assets (net) 13 1,202,912,236 1,237,112,205 Intangible assets (net) 14 24,377,473,644 18,566,351,086 Capital work in progress 15 106,855,898 63,569,606 Intangible assets under development 16 20,467,065,343 21,565,246,782 Goodwill on consolidation 17 452,995,586 486,385,178 Deferred tax asset (net) 8 325,383,156 - Non-current investments 18 9,102,903 6,430,926 Long-term loans and advances 19 2,307,718,653 2,298,114,194 Non-current trade receivables 20 558,704 - Other non-current assets 21 153,271,997 13,886,105

49,403,338,120 44,237,096,082 Current assetsCurrent investments 22 27,184,279 - Inventories 23 63,124,288 35,071,346 Trade receivables 20 378,448,939 335,533,159 Cash and cash equivalents 24 692,496,270 2,321,179,857 Short-term loans and advances 19 335,492,759 150,871,030 Other current assets 21 1,626,525,912 729,838,211

3,123,272,447 3,572,493,603 TOTAL 52,526,610,567 47,809,589,685 Summary of signi�cant accounting policies 2.1 The accompanying notes are an integral part of the �nancial statements.

As per our report of even date For and behalf of the Board of Directors of Gammon Infrastructure Projects Limited

For Natvarlal Vepari & Co. For S. R. Batliboi & Co. LLP Abhijit Rajan Himanshu ParikhICAI Firm Regn. No.: 106971W ICAI Firm Regn. No. : 301003E Chairman and Vice Chairman Chartered Accountants Chartered Accountants Managing Director

N Jayendran per Hemal Shah Kishor Kumar Mohanty Parag ParikhPartner Partner Managing Director Whole-time Director and CFO Membership No. : 40441 Membership No. : 42650 C. C. Dayal Naresh Chandra Director Director

S. C. Tripathi Homai A. Daruwalla Director Director

Place : Mumbai G. Sathis Chandran Place : Mumbai Date : May 24, 2013 Company Secretary Date : May 24, 2013

F - 46

Consolidated Financial Statements

Consolidated Statement of Profit and Lossfor the year ended March 31, 2013 (All amounts in Indian Rupees unless otherwise stated)

Particulars Notes Year ended March 31, 2013

Year ended March 31, 2012

Income Revenue from operations: Revenue from projects 25 6,621,935,116 3,991,709,878 Other operating revenues 26 281,832,258 237,674,950 Other income 27 77,624,988 64,368,399 Total Income 6,981,392,362 4,293,753,227 Expenses Project expenses 28 1,661,946,293 1,371,637,928 Employee bene�ts expenses 29 289,254,079 256,755,816 Other expenses 30 278,978,668 340,579,170 Exceptional items 31 - 97,048,057 Total Expenses 2,230,179,040 2,066,020,971 Earnings before interest, tax, depreciation and amortisation (EBITDA) 4,751,213,322 2,227,732,256 Finance costs 32 2,968,337,583 1,556,593,974 Depreciation/amortisation 13 and 14 1,608,521,955 778,992,304 Share of (pro�t)/loss from investment in associates (371,976) (2,662,280)Pro�t/(Loss) before tax 174,725,760 (105,191,742)Less: Tax expenses Current tax 303,296,990 133,389,441 Deferred tax (credit)/charge (330,190,418) 993,913 MAT credit entitlement (48,696,179) (17,140,000) Short provision for earlier years 1,678,786 - Net tax expense (73,910,821) 115,255,528 Pro�t/(Loss) after tax 248,636,581 (220,447,270)Less : Pro�t after tax attributable to minority interest 101,373,328 33,733,875 Pro�t / (Loss) attributable to group shareholders 147,263,253 (254,181,145)Earnings per share ('EPS') 35Basic 0.20 (0.35)Diluted 0.20 (0.35)Nominal value of equity share 2.00 2.00 Summary of signi�cant accounting policies 2.1

The accompanying notes are an integral part of the �nancial statements.

As per our report of even date For and behalf of the Board of Directors of Gammon Infrastructure Projects Limited

For Natvarlal Vepari & Co. For S. R. Batliboi & Co. LLP Abhijit Rajan Himanshu ParikhICAI Firm Regn. No.: 106971W ICAI Firm Regn. No. : 301003E Chairman and Vice Chairman Chartered Accountants Chartered Accountants Managing Director

N Jayendran per Hemal Shah Kishor Kumar Mohanty Parag ParikhPartner Partner Managing Director Whole-time Director and CFO Membership No. : 40441 Membership No. : 42650 C. C. Dayal Naresh Chandra Director Director

S. C. Tripathi Homai A. Daruwalla Director Director

Place : Mumbai G. Sathis Chandran Place : Mumbai Date : May 24, 2013 Company Secretary Date : May 24, 2013

F - 47

Consolidated Financial Statements

Consolidated Cash Flow Statementfor the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

Particulars Year ended March 31, 2013

Year ended March 31, 2012

A. CASH FLOW FROM OPERATING ACTIVITIES :Pro�t before tax 174,725,760 (105,191,742)Adjustments for : Employees stock options (3,519,002) (57,642)Cash alternative settlement for ESOP scheme 4,285,167 3,537,253 Depreciation and amortisation 1,608,521,955 778,992,304 Gratuity and leave encashment 8,515,166 7,142,309 Dividend income - (23,870,027)Interest (net) 2,921,668,415 1,531,386,093 (Pro�t)/Loss on sale of investments (25,012,560) (7,826,973)Share of (pro�t) / loss from investment in associates (371,976) (2,662,280)Loss on sale of assets 5,860,832 3,376,070 Assets written o� 9,914,535 10,104,861 Provision for periodic maintenance expenses 441,869,728 282,103,000 Provision for loans and advances/other assets 458,495 15,457,915 Provision for diminution in value of investment (2,300,000) 21,987,235 Exceptional items - 97,048,057 Preliminary and share issue expenses written o� 30,339 22,157,363

4,969,921,094 2,738,875,538 Operating pro�t before working capital changes 5,144,646,854 2,633,683,796 Adjustments for :Trade and other receivables (1,171,513,711) (355,449,844)Trade payables and working capital �nance (31,915,665) 246,669,546 Inventories (28,052,942) 42,634,411

(1,231,482,318) (66,145,887)Cash generated from the operations 3,913,164,536 2,567,537,909 Cash Compensation paid (22,050,000) - Direct taxes paid (281,365,030) (171,703,881)Net cash from operating activities 3,609,749,506 2,395,834,028

B. CASH FLOW FROM INVESTMENT ACTIVITIES :Capital purchases after adjusting capital creditors

(5,985,747,046) (9,822,775,344)

Proceeds on sale of �xed assets 15,342,800 186,000 Purchase of investments : - Mutual funds (2,979,328,997) (5,239,927,251) Sale of investments :- Mutual funds 2,977,157,278 5,263,797,278 - Market investments - 37,826,973 Intercorporate deposits given: - Granted during the year (493,490,746) (25,100,000)- Refund of intercorporate deposit 448,926,534 15,000,000 Advances from/(to) joint venture companies (62,508,350) 79,790,625 Advance paid for acquisition of stake in a subsidiary

(134,793,534) -

Amount received from minority shareholders 49,000,000 (370,030,000)Disposal /(acquisition) of stake in joint venture companies

42,578,538 865,131

Interest received 37,207,166 33,549,967 Dividend received - - Net cash used in investment activities (6,085,656,357) (10,026,816,621)

F - 48

Consolidated Financial Statements

Consolidated Cash Flow Statementfor the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

Particulars Year ended March 31, 2013

Year ended March 31, 2012

C. CASH FLOW FROM FINANCING ACTIVITIES : Proceeds from equity share capital - 300,002 Capital grant received 182,500,000 876,990,000 Proceeds from borrowings 12,170,527,917 17,525,056,594 Repayment of loans (8,268,014,401) (8,795,480,794)Disposal/(Acquisition) of equity stake to minority share holder

(171,637,077) 349,273,560

Interest paid (3,064,716,117) (1,473,478,130) Preliminary and share issue expenses (1,437,059) (22,157,363)Net cash from �nancing activities 847,223,263 8,460,503,869 NET INCREASE IN CASH AND CASH EQUIVALENTS (1,628,683,587) 829,521,276 Cash and cash equivalents, end of the year 692,496,270 2,321,179,857 Cash and cash equivalents, beginning of the year 2,321,179,857 1,491,658,581 NET INCREASE IN CASH AND CASH EQUIVALENTS (1,628,683,587) 829,521,276 COMPONENTS OF CASH AND CASH EQUIVALENTS :

Cash and cheques on hand 10,687,136 7,193,919 Funds in transit - -With banks : On current accounts 568,659,619 2,313,985,938 On deposit accounts 113,149,515 - Cash and cash equivalents, end of the year 692,496,270 2,321,179,857 Refer note 2.1 for summary of signi�cant accounting policies

The accompanying notes are an integral part of the �nancial statements.

As per our report of even date For and behalf of the Board of Directors of Gammon Infrastructure Projects Limited

For Natvarlal Vepari & Co. For S. R. Batliboi & Co. LLP Abhijit Rajan Himanshu ParikhICAI Firm Regn. No.: 106971W ICAI Firm Regn. No. : 301003E Chairman and Vice Chairman Chartered Accountants Chartered Accountants Managing Director

N Jayendran per Hemal Shah Kishor Kumar Mohanty Parag ParikhPartner Partner Managing Director Whole-time Director and CFOMembership No. : 40441 Membership No. : 42650 C. C. Dayal Naresh Chandra Director Director

S. C. Tripathi Homai A. Daruwalla Director Director

Place : Mumbai G. Sathis Chandran Place : Mumbai Date : May 24, 2013 Company Secretary Date : May 24, 2013

F - 49

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

1 Background Gammon Infrastructure Projects Limited a listed company and its subsidiaries, joint ventures and associates, are engaged in the development of various infrastructure projects under the Public Private Partnership ('PPP') model in sectors like transportation, energy and urban infrastructure through several special purpose vehicles (“SPVs”). Each project is governed by a separate concession agreement ('the Contract') signed between the client ('grantor') and the SPV. Majority of the projects secured are from the Government, (Central or State) or an organistation or body �oated by the Government.

2 Accounting policiesa. Basis of preparation

The Consolidated Financial Statements have been prepared to comply in all material respects with the noti�ed accounting standards by the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The consolidated �nancial statements have been prepared under the historical cost convention, on an accrual basis of accounting. The accounting policies are consistent with those used in the previous year, except for the changes in the accounting policies explained below in note 2.1(a).

b. Principles of consolidation i) Holding company and subsidiaries :

The Consolidated Financial Statements comprise the �nancial statements of GAMMON INFRASTRUCTURE PROJECTS LTD. (“the Company”) and its Subsidiary companies (the Company and its subsidiaries are hereinafter referred to as ‘the Group’). The Consolidated Financial Statement has been prepared on the following basis:

The Financial Statements of the Company and its subsidiary companies have been combined on a line by line basis by adding the book values of like items of assets, liabilities, income and expenses, after fully eliminating intra-group balances, intra-group transactions and unrealized pro�ts or losses as per Accounting Standard - 21 (‘AS-21’) “Consolidated Financial Statements” noti�ed under the Companies (Accounting Standards) Rules, 2006.

The Consolidated Financial Statements have been prepared using uniform policies for like transactions and other events in similar circumstances and are presented to the extent possible in the same manner as the Company’s separate �nancial statements.

The �nancial statements of the entities used for consolidation are drawn upto the same reporting date as that of the Company ie. March 31, 2013.

The excess of cost of investments of the Group over its share of equity in the subsidiary is recognised as goodwill. The excess of share of equity of subsidiary over the cost of investments is recognised as capital reserve.

ii) Interest in joint venture companies : The Group's interest in the joint ventures, in the nature of jointly controlled entities are included in these

consolidated �nancial statements using the proportionate consolidation method as per the Accounting Standard – 27 (‘AS-27’) “Financial Reporting of Interests in Joint Ventures” noti�ed under the Companies (Accounting Standards) Rules, 2006 (as amended). The Group combines its share of each of the assets, liabilities, income and expenses of the joint venture with similar items, on a line by line basis.

iii) Investments in associate companies : Investments in associate companies are accounted under the equity method as per the Accounting Standard –

23 (‘AS-23’) “Accounting for Investments in Associates in Consolidated Financial Statements” noti�ed under the Companies (Accounting Standards) Rules, 2006 (as amended).

Under the equity method, the investment in associates is carried in the balance sheet at cost plus post acquisition changes in the Group's share of net assets of the associate. The statement of pro�t and loss re�ects the Group's share of the results of operations of the associates.

The excess of the Group’s cost of investment over its share of net assets in the associate on the date of acquisition of investment is disclosed as goodwill. The excess of the Group’s share of net assets in the associate over the cost of its investment is disclosed as capital reserve. Goodwill / Capital Reserve is included/adjusted in the carrying amount of the investment.

F - 50

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

iv) The accounting policies adopted in the preparation of �nancial statements are consistent with those used in the previous year except as under:

Hitherto the amortisation of intangible assets arising out of service concession agreements was based on units of usage method i.e. on the number of vehicles expected to use the project facility over the concession period as estimated by the management. During the year, based on noti�cation dated April 17, 2012 issued by the Ministry of Corporate A�airs, the Company has changed the method of amortisation of intangible assets arising out of service concession agreement prospectively. E�ective April 1, 2012 the amortisation is in proportion to the revenue earned for the period to the total estimated toll and annuity revenue i.e. expected to be collected over the balance concession period. Had the Company followed the earlier method, the amortisation would have been higher by `185.09 lakhs.

2.1 Summary of other signi�cant accounting policies a. Use of estimates The preparation of �nancial statements in conformity with generally accepted accounting principles requires

management to make estimates and assumptions that a�ect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the �nancial statements and the results of operations during the reporting period end. Although these estimates are based upon management’s best knowledge of current events and actions, actual results could di�er from these estimates.

b. Revenue recognition Revenue is recognised to the extent, that it is probable that the economics bene�ts will �ow to the Group and the

revenue can be reliably measured. The following speci�c recognition criteria must also be met before revenue is recognised.

i) Infrastructure development business : Toll revenue from operations of tollable roads is recognised on usage and recovery of the usage charge thereon.

The cash compensation due on account of multiple entries of cars has been accounted on accrual basis as per the order of Government of Kerala for which Supplementary Concession Agreement is being worked out between the Government of Kerala, Greater Cochin Development Authority and Cochin Bridge Infrastructure Company Limited (a Group company).

The annuity income earned from Build, Operate, Transfer (‘BOT’) projects is recognised on a time basis over the period during which the annuity is earned. Revenues from bonus and other claims are recognised upon acceptance from customer / counterparty.

Revenue by way of berth hire charges, dust suppression charges, cargo handling charges, plot rent, wharfage, barge freight, other charges etc. are recognised on an accrual basis and is billed as per the terms of the contract with the customers at the rates approved by Tari� Authority for Marine Ports (TAMP) as the related services are performed.

Other operating income is recognised on an accrual basis.

ii) Operations and maintenance revenues : Revenue on Operations & Maintenance (O & M) contracts are recognised over the period of the contract as per

the terms of the contract.

iii) Construction contract revenues : Revenue from construction contracts is recognised on the basis of percentage completion method. The

percentage of work completed is determined by the expenditure incurred on the job till date to the total expected expenditure of the contract.

Construction contracts are progressively evaluated at the end of each accounting period. On contracts under execution which have reasonably progressed, pro�t is recognised by evaluation of the percentage of work completed at the end of the accounting period. Foreseeable losses on contract are fully provided for in the respective accounting period.

F - 51

Consolidated Financial Statements

iv) Interest income : Interest Income is recognised on a time proportion basis taking into account the amount outstanding and the

rate applicable.

v) Dividend income : Dividend is recognised when the shareholders’ right to receive payment is established by the balance sheet

date.

c. Tangible assets Tangible assets are stated at cost net of accumulated depreciation and accumulated impairment losses, if any. Cost

comprises the purchase price and any attributable cost of bringing the asset to its working condition of its intended use. The costs comprises of the purchase price, borrowings costs if capitalisation criteria are met and directly attributable costs of bringing the asset to its working condition for the intended use. Any trade discounts and rebates are deducted in arriving at the cost of the tangible asset. Any subsequent expenses related to a tangible asset is added to its book value only if it increases the future bene�ts from the existing asset beyond its previously assessed standard of performance. All other day to day repairs and maintenance expenditure and the cost of replacing parts, are charged to the statement of pro�t and loss for the period during which such expenses are incurred.

Depreciation on tangible �xed assets is provided on the Straight Line Method ('SLM') at the rates and in the manner laid down in Schedule XIV of the Companies Act, 1956 or the rates based on the estimated useful lives of the �xed assets, whichever is higher. Depreciation on tangible �xed assets purchased / installed during the year/ period is calculated on a pro-rata basis from the date of such purchase / installation.

Rates (SLM)Permanent buildings 1.33%Temporary buildings 33.33%Computers 16.21%Earth moving machinery 11.31%Electrical equipments 4.75%Furniture and �xtures 6.33%Motor vehicles 9.50%O�ce equipments 4.75%Plant and machinery 4.75%

Gains or losses arising from derecognition of tangible �xed assets are measured as the di�erence between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of pro�t and loss when the asset is derecognised.

d. Intangible assets and intangible assets under development Intangible assets are stated at cost of construction less accumulated amortised amount and accumulated

impairment losses, if any. Costs include direct costs of construction of the project and costs incidental and related to the construction activity. Costs incidental to the construction activity, including �nancing costs on borrowings attributable to construction of the project road, have been capitalised to the project road till the date of completion of construction. Such assets include self constructed assets under the BOT (Annuity) scheme, concession rights in respect of tollable roads, etc.

Intangible assets comprising project road, project port and project bridge are amortised on a straight line basis, from the date they are put to use, over the balance period of the Contract. The amortisation period and the amortisation method are reviewed at each �nancial year end. Concession rights are amortised on the pro-rata basis of actual tollable tra�c volume for the period over the total projected tollable tra�c volume over the toll periods granted for the project. The projections for the total tra�c volume are based on the report of independent professionals for this purpose. The volume of the tra�c is reviewed on periodic intervals for its consistency and appropriateness. If the right to collect toll being amortised is revised on account of the material change in the projected tra�c volume arising out of the periodic review, the amortisation would be revised accordingly.

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 52

Consolidated Financial Statements

In accordance with circular dated 17the April, 2012, issued by the Ministry of Corporate A�airs, for �xing the amortisation rates for Intangible Assets being BOT tolling assets, the Group has during the year recomputed amortisation in accordance with the new Schedule XIV order.

Intangible assets also comprise of rights of Operations and Maintenance ('O&M') and an amount paid to Mumbai Port Trust towards upfront fees for construction and operation of an o�shore terminal (License Fees Intangible). The O&M intangible results in income stream for the Group for a period of 14 years. The rights are therefore amortised over the period of 14 years on straight line basis. The license fees intangible asset being rights of O&M are amortised over the period of the subsistence of its rights commencing from the date the project becomes operational.

Gains or losses arising from derecognition of an intangible asset are measured as the di�erence between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of pro�t and loss when the asset is derecognised.

Intangible asset under development is stated at cost of development less accumulated impairment losses, if any. Costs include direct costs of development of the project road and costs incidental and related to the development activity. Costs incidental to the development activity, including �nancing costs on borrowings attributable to development of the project road, are capitalised to the project road till the date of completion of development.

e. Impairment The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any

indication exists, or when annual impairment testing for an asset is required, the Group estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or cash-generating unit’s (CGU) net selling price and its value in use. The recoverable amount is determined for an individual asset, unless the asset does not generate cash in�ows that are largely independent of those from other assets or groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash �ows are discounted to their present value using a pre-tax discount rate that re�ects current market assessments of the time value of money and the risks speci�c to the asset. In determining net selling price, recent market transactions are taken into account, if available. If no such transactions can be identi�ed, an appropriate valuation model is used.

The Group comprises of companies which are each engaged in developing a project facility. On creating these facilities the said companies establish a right to charge the users of the project development facility. The project development costs are recovered by these companies from the users of the project facilities through toll or are compensated by the grantor through annuities. For testing the impairment of the project facility developed, these companies conduct impairment tests based on detailed discounted cash �ows annually. The period of the cash �ow are from the date, the project was awarded to the date, the project has to be handed over to the grantor.

Impairment losses of operations, including impairment on inventories, are recognised in the statement of pro�t and loss, except for previously revalued tangible �xed assets, where the revaluation was taken to revaluation reserve. In this case, the impairment is also recognised in the revaluation reserve up to the amount of any previous revaluation.

After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life.

f. Investments Investments that are readily realisable and intended to be held for not more than a year are classi�ed as current

investments. All other investments are classi�ed as long-term investments.

On initial recognition, all investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties.

Current investments are carried in the �nancial statements at lower of cost and fair value determined on an individual investment basis. Long-term investments are carried at cost. However, provision for diminution in value is made to recognise a decline other than temporary in the value of long term investments.

On disposal of an investment, the di�erence between the carrying amount and the net disposal proceeds is charged to the statement of pro�t and loss.

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 53

Consolidated Financial Statements

g. Inventories Stores and consumables are valued at lower of cost and net realisable value and is determined using the weighted

average method. Net realisable value is the estimated selling price less estimated cost necessary to make the sale.

h. Borrowing costs Borrowing cost includes interest, amortisation of ancillary costs incurred in connection with the arrangement of

borrowings and exchange di�erences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost.

Borrowing costs that are directly attributable to the acquisition, construction or production of an asset that takes a substantial period of time to get ready for its intended use are capitalised. Other borrowing costs are recognised as expenditure in the period in which they are incurred.

i. Provision for taxes Tax expense comprises current and deferred tax. Current income-tax is measured at the amount expected to be

paid to the tax authorities in accordance with the Income-tax Act, 1961 enacted in India and tax laws prevailing in the respective tax jurisdictions where the Group operates. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current income tax relating to items recognised directly in equity is recognised in equity and not in the statement of pro�t and loss.

Deferred income taxes re�ects the impact of current year timing di�erences between taxable income and accounting income for the year and reversal of timing di�erences of earlier years. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax assets and deferred tax liabilities are o�set, if a legally enforceable right exists to set-o� current tax assets against current tax liabilities and the deferred tax assets and the deferred tax liabilities related to the taxes on income levied by same governing taxation laws and to the same taxable entity. Deferred tax assets are recognised only to the extent that there is reasonable certainty that su�cient future taxable income will be available against which such deferred tax assets can be realised. In situations where the Group has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognised only if there is virtual certainty supported by convincing evidence that they can be realised against future taxable pro�ts.

In the situations where any company within the Group is entitled to a tax holiday under the Income-tax Act, 1961 enacted in India or tax laws prevailing in the respective tax jurisdictions where it operates, no deferred tax (asset or liability) is recognised in respect of timing di�erences which reverse during the tax holiday period, to the extent the said company's gross total income is subject to the deduction during the tax holiday period. Deferred tax in respect of timing di�erences which reverse after the tax holiday period is recognised in the year in which the timing di�erences originate. However, the said company restricts recognition of deferred tax assets to the extent that it has become reasonably certain or virtually certain, as the case may be, that su�cient future taxable income will be available against which such deferred tax assets can be realised. For recognition of deferred taxes, the timing di�erences which originate �rst are considered to reverse �rst.

Minimum alternate tax (MAT) paid in a year is charged to the statement of pro�t and loss as current tax. The Group recognises MAT credit available as an asset only to the extent that there is convincing evidence that the Group will pay normal income tax during the speci�ed period, i.e., the period for which MAT credit is allowed to be carried forward. In the year in which the Group recognizes MAT credit as an asset in accordance with the Guidance Note on Accounting for Credit Available in respect of Minimum Alternative Tax under the Income-tax Act, 1961, the said asset is created by way of credit to the statement of pro�t and loss and shown as “MAT Credit Entitlement.” The Group reviews the “MAT credit entitlement” asset at each reporting date and writes down the asset to the extent the Group does not have convincing evidence that it will pay normal tax during the speci�ed period.

j. Foreign currency translation Initial recognition : Foreign currency transactions are recorded in the reporting currency by applying to the foreign currency amount the

exchange rate between the reporting currency and the foreign currency at the date of the transaction.

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 54

Consolidated Financial Statements

Conversion : Foreign currency monetary items are reported using the closing rate. Non-monetary items which are carried in

terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction; non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined.

Exchange di�erences : Exchange di�erences arising on the settlement of monetary items or on reporting the Group's monetary items at

rates di�erent from those at which they were initially recorded during the year, or reported in previous �nancial statements, are recognised as income or as expenses in the year in which they arise except those arising from investments in non-integral operations.

k. Preliminary and share issue expenses Preliminary and share issue expenses (net of taxes) incurred are charged to the security premium account, if available,

or to the statement of pro�t and loss.

l. Operating lease Leases where the lessor e�ectively retains substantially all the risks and bene�ts of ownership of the leased term are

classi�ed as operating leases. Operating lease payments are recognised as an expense in the statement of pro�t and loss on a straight line basis over the lease term.

m. Earnings per share Basic and diluted earnings per share are calculated by dividing the net pro�t or loss for the period attributable to

equity shareholders by the weighted average number of equity shares outstanding during the period. Partly paid shares are treated as a fraction of an equity share to the extent that they are entitled to participate in dividends relative to a fully paid equity share during the reporting period. The weighted number of equity shares are adjusted for events such as bonus issue, bonus element in the rights issue, share split and reverse share split (consolidation of shares) that have changed the number of equity shares outstanding, without corresponding change in resources.

For the purpose of calculating diluted earnings per share, the net pro�t or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the e�ects of all dilutive potential equity shares.

n. Employee bene�ts Retirement bene�ts in the form of Provident Fund is a de�ned contribution scheme. The contributions are charged to

the statement of pro�t and loss for the year when the contributions are due. The Group has no obligation, other than the contribution payable to the provident fund.

The Group operates only one de�ned bene�t plan for its employees i.e. gratuity liability. The costs of providing this bene�t are determined on the basis of actuarial valuation at the each year end. Actuarial valuation is carried out using the projected unit credit method. Actuarial gains and losses of the de�ned bene�t plan are recognised in full in the period in which they occur in the statement of pro�t and loss.

Accumulated leave, which is expected to be utilised within the next twelve months, is treated as short-term employee bene�t. The Group measures the expected cost of such absences as the additional amount that it expects to pay as a result of the unused entitlement that has accumulated at the reporting date.

The Group treats accumulated leave expected to be carried forward beyond twelve months, as long-term employee bene�t for measurement purposes. Such long term compensated absences are provided for based on the actuarial valuation using the projected unit credit method at the year end. Actuarial gains and losses of the de�ned bene�t plan are recognised in full in the period in which they occur in the statement of pro�t and loss and are not deferred.

o. Employee share based payments ('ESOP') The Group uses the intrinsic value (excess of the share price on the date of grant over the exercise price) method

of accounting prescribed by the Guidance Note (‘GN’) on ‘Accounting for employee share-based payments’ issued by the Institute of Chartered Accountants of India (‘ICAI’) (‘the guidance note’) to account for its Employee Stock

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 55

Consolidated Financial Statements

Option Scheme (the ‘ESOP’ Scheme) read with SEBI (Employees stock option scheme or Employees Stock Purchase) Guidelines,1999. Compensation expense is amortised over the vesting period of the option on SLM basis.

p. Grants received The Group on receipt of construction grant, received as equity support from grantors, accounts the same as capital

reserves. The grant related to operations not forming part of equity support is credited to the statement of the Pro�t and Loss on a pro-rata basis in the year when the same is due and receivable and when the related costs are incurred.

q. Deferred payment liability The deferred payment liability represents the cash payout (Negative grant) payable to the grantor as per the terms of

the Contract at the end of the concession period is added to the cost of respective asset. The said deferred payment liability does not carry any interest thereon.

r. Minority interest Minority interest comprises of amount of equity attributable to the minority shareholders at the date on which

investments are made by the Group and further movements in their share in the equity, subsequent to the date of the investments.

s. Segment reporting Identi�cation of segments :

Business segments have been identi�ed on the basis of the nature of services, the risk return pro�le of individual business, the organisational structure and the internal reporting system of the Group.

t. Provisions A provision is recognised when the Group has a present obligation as a result of past event; it is probable that an

out�ow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made of the amount of obligation. Provisions are not discounted to its present value and are determined based on best estimate required to settle the obligation at the reporting date. These are reviewed at each reporting date and adjusted to re�ect the current best estimates.

u. Cash and cash equivalents Cash and cash equivalents comprise of cash at bank and in hand and short-term investments with an original maturity

of three months or less.

v. Contingent liability A contingent liability is a possible obligation that arises from past events whose existence will be con�rmed by

the occurrence or non-occurrence of one or more uncertain events beyond the control of the Group or a present obligation that is not recognised because it is not probable that an out�ow of resources will be required to settle an obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognised because it cannot be measured reliably. The Group does not recognise a contingent liability but discloses its existence in the �nancial statements.

w. Measurement of EBITDA The Group measures EBITDA on the basis of pro�t/(loss) from continuing operations. In the measurement, the

Company does not include depreciation and amortization expense, �nance costs and tax expense.

3 The consolidated �nancial statements comprise the �nancial statements of Gammon Infrastructure Projects Limited (GIPL’) (the holding company), its subsidiary companies, joint ventures and associates consolidated on the basis of the relevant accounting standards as discussed in note 2b.

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 56

Consolidated Financial Statements

a. Subsidiaries : Following subsidiary companies (incorporated in India) have been consolidated in these �nancial statement as per

AS-21 as on March 31, 2013:

Voting power & bene�cial interestParticulars As at

March 31, 2013As at

March 31, 2012Andhra Expressway Limited (‘AEL’) 100.00% 100.00%Aparna Infraenergy India Private Limited (‘AIIPL’) 100.00% 100.00%Birmitrapur Barkote Highway Private Limited (‘BBHPL’) [refer note 3 (a)(i)] 100.00% N.A.Cochin Bridge Infrastructure Company Limited (‘CBICL’) 97.66% 97.66%Chitoor Infrastructure Company Private Limited (‘CICPL’) 100.00% 100.00%Dohan Renewable Energy Private Limited (‘DREPL’) 100.00% 100.00%Earthlink Infrastructure Projects Private Limited (‘EIPPL’) 100.00% 100.00%Gammon Logistics Limited (‘GLL’) 100.00% 100.00%Gammon Projects Developers Limited (GPDL’) 100.00% 100.00%Gammon Renewable Energy Infrastructure Limited (‘GREIL’) 100.00% 100.00%Gammon Road Infrastructure Limited (‘GRIL’) 100.00% 100.00%Gammon Seaport Infrastructure Limited (‘GSIL’) 100.00% 100.00%Gammon Renewable Energy Private Limited (‘GREPL’) 100.00% 100.00%Gorakhpur Infrastructure Company Limited (‘GICL’) 96.53% 96.53%Haryana Biomass Power Limited (‘HBPL’) 100.00% 100.00%Indori Renewable Energy Private Limited (‘IREPL’) 100.00% 100.00%Jaguar Projects Developers Limited (‘JPDL’) 100.00% 100.00%Kasavati Renewable Energy Private Limited (‘KREPL’) 100.00% 100.00%Kosi Bridge Infrastructure Company Limited (‘KBICL’) 100.00% 100.00%Lilac Infraprojects Developers Limited (‘LIDL’) 100.00% 100.00%Markanda Renewable Energy Private Limited (‘MREPL’) 100.00% 100.00%Marine Project Services Limited (‘MPSL’) 100.00% 100.00%Mormugao Terminal Limited (‘MTL’) [refer note 3 (a)(i)] 100.00% N.A.Mumbai Nasik Expressway Limited (‘MNEL’) 79.99% 79.99%Patna Buxar Highways Limited (‘PBHL’) 100.00% 100.00%Pataliputra Highways Limited (‘PHL’) 100.00% 100.00%Patna Highway Projects Limited (‘PHPL’) 100.00% 100.00%Pravara Renewable Energy Limited (‘PREL’) 100.00% 100.00%Ras Cities and Townships Private Limited (‘RCTPL’) 100.00% 100.00%Rajahmundry Expressway Limited (‘REL’) 100.00% 100.00%Rajahmundry Godavari Bridge Limited (‘RGBL’) 55.65% 51.00%Satluj Renewable Energy Private Limited (‘SREPL’) 100.00% 100.00%Sidhi Singrauli Road Project Limited (‘SSRPL’) [refer note 3 (a)(i)] 100.00% N.A.Sikkim Hydro Power Ventures Limited (‘SHPVL’) 100.00% 100.00%Segue Infrastructure Projects Private Limited (‘SIPPL’) 100.00% 100.00%Sirsa Renewable Energy Private Limited (‘Sirsa REPL’) 100.00% 100.00%Tada Infrastructure Development Company Limited (‘TIDCL’) 100.00% 100.00%Tangri Renewable Energy Private Limited (‘TREPL’) 100.00% 100.00%Tidong Hydro Power Limited (‘THPL’) 51.00% 51.00%Vijaywada Gundugolanu Road Project Private Limited (‘VGRPPL’) 100.00% 100.00%Vizag Seaport Private Limited (‘VSPL’) 73.76% 73.76%Yamuna Minor Minerals Private Limited (‘YMMPL’) [refer note 3 (a)(i)] 100.00% 100.00%Yamunanagar Panchkula Highway Private Limited (‘YPHPL’) [refer note 3 (a)(i)] 100.00% N.A.Youngthang Power Ventures Limited (‘YPVL’) 100.00% 100.00%

During the current year, Birmitrapur Barkote Highway Private Limited (‘BBHPL’), Sidhi Singrauli Road Project Limited (SSRPL’), Yamunanagar Panchkula Highway Private Limited (‘YPHPL’) and Mormugao Seaport Limited were incorporated as a subsidiaries of the Group. The name of Yamuna Renewable Energy Private Limited was changed to Yamuna Minor Minerals Private Limited and Mormugao Seaport Limited was changed to Mormugao Terminal Limited (‘MTL’).

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 57

Consolidated Financial Statements

As part of its overall business plans, the Group has been acquiring bene�cial interest and voting rights. This bene�ceal interest along with the Group’s legal shareholdings has resulted in the Group having control over 51% in various SPVs as listed above. The details of the amounts paid and resultant bene�cial interest and voting rights acquired are as follows:

As at March 31, 2013 As at March 31, 2012

Particulars Equity shares

Nos.

Value`

Bene�cial interest

%

Equity shares

Nos.

Value`

Bene�cial interest

%

AEL 7,540,050 126,651,866 26.00% 7,540,050 126,651,866 26.00%

CICPL 10,000 100,000 100.00% 10,000 100,000 100.00%

EIPPL 10,000 100,000 100.00% 10,000 100,000 100.00%

GICL 14,947,238 149,472,380 27.53% 14,947,238 149,472,380 27.53%

KBICL 12,562,831 125,628,310 26.01% 12,562,831 125,628,310 26.01%

REL 7,540,050 119,575,780 26.00% 7,540,050 119,575,780 26.00%

SIPPL 10,000 100,000 100.00% 10,000 100,000 100.00%

THPL 25,500 255,000 51.00% 25,500 255,000 51.00%

b. Joint venture entities : The following jointly controlled entities have been considered applying AS-27 on the basis of audited accounts

(except stated otherwise) for the year ended March 31, 2013.

i) Details of joint ventures entered into by the Group :

Particulars % of Interest As at

March 31, 2013

% of Interest As at

March 31, 2012

Joint venture companies

Blue Water Iron Ore Terminal Private Limited (‘BWIOTPL’) * 10.12% 31.00%

Indira Container Terminal Private Limited (‘ICTPL’) 50.00% 50.00%

Maa Durga Expressway Pvt Ltd (‘MDEPL’) 49.00% NA

SEZ Adityapur Limited (‘SEZAL’) 38.00% 38.00%

* GIPL had entered into a Joint Venture agreement for a 31% equity stake in BWIOTPL. However, GIPL had contributed only 10.12% in the equity capital of BWIOTPL. During the current year, BWIOTPL has initiated the process of liquidation and the group management believes that it does not have any obligation to further contribute in the equity capital of BWIOTPL. Accordingly the same has been consolidated considering the Company’s 10.12% holding of the group as against 31% consolidated in the prior year. As the Company had contributed less than its share in the prior year an amount of ̀ 48,566,978 which was shown as payable has been written back during the year.

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

F - 58

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

ii) The proportionate share of assets, liabilities, income and expenditure of the Joint Ventures consolidated in the accounts is tabulated hereunder.

Particulars As atMarch 31, 2013

As atMarch 31, 2012

AssetsNon-current assetsFixed assets :Tangible assets (net) 13,309,171 43,197,045 Intangible assets (net) 125,000,000 125,000,000 Capital work in progress - 44,588,156 Intangible assets under development 2,281,750,418 1,673,191,783 Long-term loans and advances 79,491,729 75,443,507 Current assetsInventories - 597,957 Trade receivables 3,922,489 753,427 Cash and cash equivalents 33,435,132 10,383,854 Short-term loans and advances 13,424,331 17,265,005 Other current assets 7,345,878 - Total Assets 2,566,863,427 1,990,420,734 Liabilities Non-current liabilitiesLong-term borrowings 1,961,861,013 1,487,979,019 Long-term provisions 702,405 780,786 Current LiabilitiesTrade payables, current 67,360,477 816,925 Other current liabilities 157,433,393 147,844,844 Short-term provisions 68,009 221,684 Total liabilities 2,187,425,297 1,637,643,258 Reserves and surplusDe�cit in the statement of pro�t and loss :Opening balance (202,537,505) (131,224,080)Loss during the current year (47,692,714) (139,317,773)Total reserves and surplus (250,230,219) (270,541,853)Total reserves, surplus and liabilities 1,937,195,078 1,367,101,405

IncomeRevenue from projects 26,531,767 28,923,096 Other income 942,327 1,602,724 Total income 27,474,094 30,525,820

Expenses Project expenses 39,506,967 69,198,515 Employee bene�t expenses 9,660,258 13,379,930 Other expenses 14,629,299 6,257,437 Finance cost 3,650,000 70,221,007 Depreciation and amortisation 7,650,461 10,592,881 Total expenses 75,096,986 169,649,770 Pro�t before tax (47,622,892) (139,123,950)Provision for tax - 193,823 Pro�t after tax (47,622,892) (139,317,773)Capital commitments 1,332,012,768 714,741,238

The above �gures pertaining to the joint venture companies are based on the audited accounts of ICTPL and BWIOTPL and unaudited management accounts of MDEPL and SEZAL for the year ended March 31, 2013. All the joint venture companies were incorporated in India.

F - 59

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

c. Associates : The following associates have been accounted for on one line basis applying the equity method in accordance with

the Accounting Standard (AS) – 23 “ Accounting for Investment in Associates in Consolidated Financial Statements”.

Particulars % of Interest As at

March 31, 2013

% of Interest As at

March 31, 2012

ATSL Infrastructure Projects Limited (‘AIPL’) 49.00% 49.00%Eversun Sparkle Maritime Services Private Limited (‘ESMSPL’) 30.90% 30.90%Modern Tollroads Limited* 49.00% 49.00%*Based on the un-audited management accounts for the year ended March 31, 2013.

4 Share capital Particulars As at

March 31, 2013 As at

March 31, 2012

i) Authorised equity share capital :1,000,000,000 (Previous year : 1,000,000,000) equity shares of ` 2 each 2,000,000,000 2,000,000,000 Total authorised equity share capital 2,000,000,000 2,000,000,000

ii) Issued and subscribed equity share capital :734,836,688 (Previous year : 729,573,868 ) equity shares of ` 2 each 1,469,673,376 1,459,147,736 Total issued and subscribed equity share capital 1,469,673,376 1,459,147,736

iii) Paid-up equity shares : 734,026,438 (Previous year : 728,763,618) equity shares of ` 2 each fully paid-up

1,468,052,876 1,457,527,236

Total paid-up equity shares 1,468,052,876 1,457,527,236 iv) Forfeiture of equity shares :

Money received in respect of 162,050 (Previous year :162,050) equity shares forfeited of ` 10 each 8,102,500 8,102,500 Total money received of forfeited equity shares 8,102,500 8,102,500 Total net paid-up equity share capital 1,476,155,376 1,465,629,736

a. Reconciliation of the number of equity shares outstanding at the beginning and at the end of the year :

As at March 31, 2013 As at March 31, 2012 Particulars Numbers ` Numbers `

Equity shares of ` 2 each fully paid-up Balance, beginning of the year 728,763,618 1,457,527,236 728,740,162 1,457,480,324 Issued during the year on exercise of Employee Stock Options (‘ESOP’) - - 23,456 46,912 Issued during the year as bonus shares 5,262,820 10,525,640 - - Balance, end of the year 734,026,438 1,468,052,876 728,763,618 1,457,527,236

b. Terms / rights attached to equity shares : The Company has only one class of shares referred to as equity shares having a par value of ` 2/- per share. Each

holder of equity shares is entitled to one vote per share.

In the event of liquidation of the Company, the equity share holders will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

F - 60

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

c. The Company has issued bonus shares during the year to the shareholders other than the promoter group in the ratio of 1:34 (with the fractions being rounded-o� to the next higher whole number) aggregating to 5,262,820 equity shares of ` 2/- each as fully paid by utilising securities premium account aggregating to ` 10,525,640 /-

d. Shares held by the holding company and /or their subsidiaries / associates : Out of equity shares issued by the Company, shares held by its holding and /or their subsidiaries / associates are as follows:

As at March 31, 2013 As at March 31, 2012

Registered shareholders Numbers ` Numbers `

Equity shares of ` 2/- each fully paid-up Gammon India Limited (‘GIL’) 528,000,000 1,056,000,000 528,000,000 1,056,000,000 Gactel Turnkey Projects Limited (‘GTPL’), subsidiary of the holding company 22,400,000 44,800,000 22,400,000 44,800,000 Total 550,400,000 1,100,800,000 550,400,000 1,100,800,000

e. Details of registered shareholders holding more than 5% shares :

As at March 31, 2013 As at March 31, 2012

Registered shareholders holding more than 5%

Numbers % of holding Numbers % of holding

Equity shares of ` 2/- each fully paid-up GIL 528,000,000 71.93% 528,000,000 72.45%Total 528,000,000 71.93% 528,000,000 72.45%

As per the records of the Company, including its register of shareholders/members and other declarations received from shareholders, the above shareholding represents legal ownership of the shares.

f. Shares reserved under options to be given : 1,146,670 (Previous year : 3,395,420) equity shares of ` 2 each of the Company has been reserved for issue as ESOPs

[note 5(b)].

5 Reserves and surplus

Particulars As atMarch 31, 2013

As at March 31, 2012

Capital reserve :Capital grant :Balance, beginning of the year 1,373,650,000 496,660,000

Add : Capital grant received during the year 182,500,000 876,990,000

Less : Capital grant transferred to minority share holders 609,870,504 -

Balance, end of the year (A) 946,279,496 1,373,650,000 Securities premium account :Balance, beginning of the year 3,509,443,124 3,523,177,883

Add : On issue of shares on exercise of employee stock options - 1,265,241

Less : Security premium on divestment of joint venture company - 15,000,000

Less : Utilised on issuance of bonus shares (10,525,640) -

Less : Share issue expenses during the year (1,406,720) -

Balance, end of the year (B) 3,497,510,764 3,509,443,124

F - 61

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

Particulars As atMarch 31, 2013

As at March 31, 2012

Employee stock options :Employee stock options outstanding 6,578,002 9,676,544

Less : Employee stock options exercised - 176,790

Less : Forfeiture of employee stock options o�ered 3,565,249 3,148,505

Add : Short accounting of ESOPs’ in prior years - 273,000

Less : Deferred employee compensation outstanding (46,247) 46,247

Balance, end of the year (C) 3,059,000 6,578,002 Other reserves :General ReserveBalance, beginning of the year 313,248,076 220,300,000

Add: Amounts transferred from surplus balance in the statement of pro�t and loss 90,552,576

Add: reversal of provision for employee stock options outstanding on forfeiture / lapse of options 2,395,500

Add: reversal of provision for Cash compensation scheme -

Balance, end of the year (D) 313,248,076 313,248,076 Surplus / (de�cit) in the statement of pro�t and lossBalance, beginning of the year 781,328,222 1,198,982,083

Add : Pro�t /(Loss) for the year 147,263,254 (254,181,145)

Less: Proposed dividend for minority shareholders 22,877,417 -

Less: Tax on proposed dividend 14,818,155 -

Less: Tax on equity dividend - 72,920,140

Less: Transfers to general reserve 90,552,576

Balance, end of the year (E) 890,895,904 781,328,222 Total reserves and surplus (A+B+C+D+E) 5,650,993,240 5,984,247,424

a. Capital grant : Capital grant includes grant received by two SPVs of the Group, from NHAI and the Government of Andhra Pradesh in

the nature of equity support of the grantor. b. Employees stock options (‘ESOP’) : The Company has instituted an ESOP Scheme “GIPL ESOP 2007” scheme during the year 2007-08, approved by the

shareholders vide their resolution dated May 4, 2007, as per which the Board of Directors of the Company granted 1,640,000 equity-settled stock options to its employees pursuant to the ESOP Scheme on July 1, 2007 and October 1, 2007. Each options entitles an employee to subscribe to 1 equity share of ` 10 each of the Company at an exercise price of ` 80 per share. During the year 2008-09, the Compensation Committee of the Board of the Directors of the Company at its meeting held on October 1, 2008, has further granted 920,000 equity-settled options to eligible employees of the Company at the market price of ` 63.95 per equity share of ` 10 each, prevailing on September 30, 2008 upon expiry of the respective vesting period which ranges from one to three years. During the current year, 324,750 (Previous year 229,500) options were forfeited / lapsed. Out of the options granted, 161,000 (Previous year 485,750) are outstanding at the end of the year.

During the year 2008-09, the Compensation Committee of the Board of the Directors of the Company at its meeting held on October 1, 2008, instituted a new ESOP Scheme “GIPL ESOP 2008” scheme as per which the Company has further granted 490,000 equity-settled options to eligible employees of the Company at the market price of ` 63.95 per equity share of ` 10 each, prevailing on September 30, 2008 upon expiry of the respective vesting period which ranges from one to three years. During the current year, 25,000 (Previous year 33,334) options were forfeited / lapsed. Out of the options granted, 68,344 (Previous year 93,334) are outstanding at the end of the year.

F - 62

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

Further, during the year 2009-10, the Compensation Committee of the Board of the Directors of the Company, at its meeting held on May 8, 2009 further granted 210,000 equity-settled options to eligible employees of the Company, at the market price of ` 72.10 per equity share of ` 10 each (post sub-division of equity shares subscribed to �ve equity shares of ` 2 each), prevailing on that date upon expiry of the vesting period of three years. During the current year, 100,000 (Previous year : 20,308) options were forfeited / lapsed while None (Previous year : 4,692) options were exercised by the employees. Out of the options granted, None (Previous year : 100,000) are outstanding at the end of the year.

The details of the grants under the aforesaid ESOPs Schemes are summarised hereunder :

ESOP scheme 2007

Particulars March 31, 2013 March 31, 2012

Date on which options were granted Jul/07 Oct/07 Oct/08 Jul/07 Oct/07 Oct/08Vesting from Jul/08 Oct/08 Oct/09 Jul/08 Oct/08 Oct/09Fair value of shares on grant date (`) 99.00 124.00 63.95 99.00 124.00 63.95 Market value of shares on grant date (`) N.A. N.A. 63.95 N.A. N.A. 63.95 Exercise price of options granted (`) 80.00 80.00 63.95 80.00 80.00 63.95 Outstanding options at the beginning of the year (Nos) 305,750 - 180,000 420,250 25,000 270,000 Options granted during the year (Nos) - - - - - - Options lapsed during the year (Nos) 144,750 - 180,000 114,500 5,000 90,000 Options forfeited during the year (Nos) - - - - 20,000 - Options exercised during the year (Nos) - - - - - - Outstanding granted options at the end of the year (Nos) 161,000 - - 305,750 - 180,000

ESOP scheme 2008

Particulars March 31, 2013 March 31, 2012

Date on which options were granted

October 1, 2008 May 8, 2009 October 1, 2008 May 8, 2009

Vesting from October 1, 2009 October 1, 2010 October 1, 2009 October 1, 2010Market value of shares as on grant date (`) 63.95 72.10 63.95 72.10 Exercise price of options granted (`) 63.95 63.95 63.95 63.95 Outstanding options at the beginning of the year (Nos) 93,334 100,000 126,668 125,000 Options granted during the year (Nos) - - - - Options lapsed / forfeited during the year (Nos) 25,000 100,000 33,334 20,308 Options exercised during the year (Nos) - - - 4,692 Outstanding granted options at the end of the year (Nos) 68,334 - 93,334 100,000

F - 63

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

Other disclosures

Particulars ESOP Scheme2007

ESOP Scheme2008

ESOP Scheme2008

ESOP Scheme2008

Options (Numbers) 270,000 490,000 500,000 210,000 Weighted average fair value of options granted

40.46 40.46 39.40 36.12

Option pricing model used Black Scholes Option Pricing Model

Black Scholes Option Pricing Model

Black Scholes Option Pricing Model

Black Scholes Option Pricing Model

Equity share price 74.30 74.30 47.90 70.85 Exercise price 63.95 63.95 10.00 63.95 Expected volatility 0.5169 0.5169 0.6533 0.7508 Weighted average on unexpired life of the options (in years) 2.51 2.51 1.68 0.76 Expected dividend Nil Nil Nil Nil Risk free interest rate 8.61% 8.61% 6.81% 5.03%

Basis of determination of volatility

Average of GIPL (from the date of listing)

and 4 previous years average of IVRCL and

Nagarjuna

Average of GIPL (from the date of listing) and 4

previous years average of IVRCL and Nagarjuna

Average of GIPL (from the date of listing)

and 4 previous years average of IVRCL and

Nagarjuna

Average of GIPL (from the date of listing)

and 4 previous years average of GVK and

GMR

The Company was an unlisted Company at the date when options were granted under GIPL ESOP 2007 scheme and therefore the intrinsic value was determined on the basis of an independent valuation by following the price to Net Asset Value (NAV) method.

If the compensation cost been determined in accordance with the fair value approach described in the guidance note, the Company’s net pro�t for the year ended March 31, 2013 as reported would have changed to amounts indicated below:

Particulars Year ended March 31, 2013

Year ended March 31, 2012

Net Income as reported 304,267,845 329,401,467 Add: Stock based compensation expense included in the reported income 46,247 958,806 Less: Stock based compensation expenses determined using fair value of options 233,195 7,760,545 Net pro�t (adjusted) 304,080,897 322,599,728 Basic earnings per share as reported 0.41 0.45 Basic earnings per share (adjusted) 0.41 0.44 Diluted earnings per share as reported 0.41 0.45 Diluted earnings per share (adjusted) 0.41 0.44 Weighted average number of equity shares at the end of the year 734,026,438 728,755,992 Weighted average number of shares considered for diluted earnings per share (adjusted) 734,180,933 729,105,907

6 Minority interestParticulars As at

March 31, 2013 As at

March 31, 2012Balance, beginning of the year 1,219,772,941 836,765,506 Add: Minority interest in equity : (Decrease) / Increase in minority’s share in equity capital of subsidiaries in the current year (129,058,538) 349,273,560 Capital grant transferred to minority share holders 609,870,504 -

480,811,965 349,273,560 Add: Minority interest in pro�ts/(losses) of subsidiaries : Minority interest in pro�ts/(losses) of subsidiaries for the current year 101,373,328 33,733,875

101,373,328 33,733,875 Balance, end of the year 1,801,958,234 1,219,772,941

F - 64

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

7 Long-term borrowings

March 31, 2013 March 31, 2012

Particulars Non-current portion

Current maturities

Non-current portion

Current maturities

I Term loans[refer below for details of security]Indian rupee loans from banks 22,215,844,008 1,917,333,716 20,892,611,616 3,033,136,860 From �nancial institutions 12,564,196,787 1,112,264,705 7,908,754,412 124,235,293 From others - 250,000,000 250,000,000 800,000,000

34,780,040,795 3,279,598,421 29,051,366,028 3,957,372,153 II 10.3% intercorporate loan,

unsecured From a minority shareholder 137,155,000 - 137,155,000 -

III Deferred payment liability, unsecuredNegative grant payable to NHAI 1,200,000,000 - 1,200,000,000 - Amount disclosed under “Other Current Liabilities” (note 12)

- (3,279,598,421) - (3,957,372,153)

Total long term borrowings 36,117,195,795 (3,279,598,421) 30,388,521,028 (3,957,372,153)The above term loans includes :Secured borrowings 34,205,562,616 29,051,366,028 Unsecured borrowings 574,478,179 - Total 34,780,040,795 - 29,051,366,028 -

a. The above term loans from banks and �nancial institutions are primarily taken by various project executing entities of the Group for the execution of the projects. These loans are secured by a �rst mortgage and charge on all the movable properties, immovable properties, tangible assets, intangible assets and all bank accounts (including escrow bank accounts) save and except the project assets of each individual borrowing company in the Group.

b. Loans from others are secured by �rst charge on proceeds/ receivables to be received from the National Highways Authority of India (NHAI) towards annuities to be received for the period between the Scheduled Commercial Operation Date and the actual Commercial Operations Date (COD). This loan carries interest rate in the range of 13% p.a. The loan is repayable on from March 1, 2014.

c. One of the Group SPV had obtained a secured term loan from a �nancial institution for which charge is yet to be created as at March 31, 2013. The �nancial institution has levied a penal interest of ` 21,651,124 which has not been paid. Further the SPV had received during the year a letter from a bank towards charges for prepayment of loans which has been contested by the SPV and hence remained unpaid till year end.

d. During the year, one of the SPV was under negotiation with one of the lender in determining the rate of interest on long term borrowings. The lender has charged an excess interest amounting to ` 6,219,129/- till March 31, 2013 including ` 4,835,129 as at March 2012. However, post year end, the lender has through a letter communicated the reversal of excess interest charged.

e. During the year, the one of the SPV has been regularly paying interest to the secured lenders as the terms of the loan agreement. However, in respect of some of the lenders there was a di�erence between the amount of interest charged by the lenders and the amounts paid by the SPV resulting in an outstanding amount payable of ` 7,206,873 which is outstanding as on the balance sheet date. The Company is taking up the matter with the lenders for resolution. Pending the resolution the same is shown as continuing default as at the balance sheet date.

f. Term loan from �nancial instituion also includes loan availed by GIPL and is secured by a) Pledge of equity shares of one of the SPV for an aggregate value of ` 2,194,500,000/-, b) a �rst and exclusive charge on the Designated account, Debt Service Reserve aggregating to ` 101,021,821/- as on March 31, 2013 Surplus Monies and the sale proceeds to be received by the Borrower due to Mumbai Nasik Expressway Limited ‘MNEL’ Stake sale and/or the Lender exercising

F - 65

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

its power in respect of the Borrower’s stake in MNEL under the Loan Agreement. The balance is secured by equity shares of GIPL pledged by the holding company, hence is shown as unsecured portion. This term loan carries an interest rate of 14.00% pa. It’s repayment is entirely due on September 15, 2014.

g. Pledge of shares : The equity shares held by the Company and / or GIL in a subsidiary and /or joint venture company of the Group

are pledged with respective lenders or consortium of lenders for the individual secured loan availed by the said subsidiary and / or joint venture company from their respective lenders or consortium of lenders.

Number of equity shares pledged

Particulars Face value of equity shares

`March 31, 2013

NumbersMarch 31, 2012

Numbers

AEL 10.00 13,175,970 13,171,442 CBICL 10.00 1,664,019 1,664,019 GICL 10.00 27,686,396 37,279,629 KBICL 10.00 20,767,040 20,767,040 MNEL 10.00 38,942,800 16,120,000 PBHL 10.00 13,000 - PHL 100.00 7,350 7,350 PHPL 10.00 750,000 750,000 REL 10.00 14,744,579 14,744,579 RGBL 10.00 89,573,750 89,573,750 VSPL 10.00 61,515,633 61,515,633 ICTPL 10.00 16,500,000 20,000,000 Total 285,340,537 275,593,442

The change in the balances between March 31, 2012 and March 31, 2013 represent additional /reduction of pledge during the current year.

h. Interest rates : The above mentioned long-term loans carry an interest rate which is at a spread above/below the bank’s base rate or

bank prime lending rate or G-sec rate or at a negotiated rate. The spread ranges from 50 to 300 bases points. In case of a consortium of lenders the rate applicable is the highest rate charged by any one member of the consortium thereof.

Loans from others, carries interest rate in the range of 11% to 14% p.a.

i. Schedule of repayments of the term loans :

As at March 31, 2013

As at March 31, 2012

Installments payable within next one year 3,279,598,421 3,957,372,153 Installments payable between 2 to 5 years 15,541,645,535 12,965,139,380 Installments payable beyond 5 years 19,238,395,261 16,086,226,648 Total 38,059,639,216 33,008,738,181

j. Unsecured intercorporate loan : This has been availed by one of the SPV of the Group from its minority shareholder. The repayment of the same is due

on March 31, 2015.

k. Unsecured, deferred payment liability : As per the terms of the concession agreement between MNEL and NHAI, MNEL is required to make a cash payout

(‘Negative Grant’) of ̀ 1,200,000,000 in the last year of the concession period (i.e. March, 2026). The same is capitalised as toll concession rights and is represented as deferred payment liability in the �nancial statements.

F - 66

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

8 Deferred tax liabilities (net)

Particulars As at March 31, 2013

As at March 31, 2012

Deferred tax asset 325,383,156 - Deferred tax liability 20,837,532 25,644,794 Net deferred tax asset/(liability) 304,545,625 (25,644,794) Deferred tax assetOn unabsorbed depreciation 604,603,209 269,620,950 On account of employee bene�ts 10,422,736 6,311,275 Deferred tax liabilityOn account of depreciation/amortisation 310,480,320 301,577,019 Net deferred tax asset/(liability) 304,545,625 (25,644,794)

One of the SPV has unabsorbed depreciation as per tax returns which is available for set o� against taxable income. The SPV has recognised the deferred tax asset credit estimating its future taxable income on the basis of the actual tra�c plying on the road during the balance period of the Concession which satis�es the test of virtual certainty supported by convincing evidence for recognising the deferred tax asset on the unabsorbed depreciation as per the tax returns. The SPV has obtained an independent expert’s opinion about the satisfaction of the convincing evidence as required by Accounting Standard (AS) - 22 on Accounting for taxes on income. The deferred tax asset recognised amounts to ` 330,266,288 on the unabsorbed depreciation as per the tax returns available for set o� from future taxable income.

9 Other long-term liabilities

Particulars As at March 31, 2013

As at March 31, 2012

Margin money deposit * 5,000,000 5,000,000 Performance deposit from vendor 3,850,000 3,850,000 Total other long-term liabilities 8,850,000 8,850,000

*Received from a joint venture against bank guarantee issued GIPL’s limits.

10 Provisions

March 31, 2013 March 31, 2012

Particulars Long-term Short-term -Long-term Short-term

Provision for employee bene�tsProvision for cash compensation scheme - 1,741,294 - 19,506,127 Provision for gratuity 7,415,139 306,093 5,231,157 457,832 Provision for leave encashment 18,856,442 4,003,951 11,866,968 2,304,075

26,271,581 6,051,338 17,098,125 22,268,034 Other provisionsProposed dividend 22,877,417 Dividend distribution tax on proposed dividend 14,818,155 Provision for taxation - 199,555,016 - 106,902,426 Provision for periodic maintenance 723,972,728 - 282,103,000 -

723,972,728 237,250,588 282,103,000 106,902,426 Total provisions 750,244,309 243,301,926 299,201,125 129,170,460

F - 67

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

a. Cash Alternative Settlement of ESOP Scheme : During the previous years, the Compensation Committee of the Board of Directors has implemented a scheme of

Retention Bonus for its employees. Under this scheme, employees (excluding the Managing Director), to whom stock options were o�ered in the current year are entitled to a cash alternative to the options which would be payable in lieu of their not exercising the right to apply for the shares against the options granted under the ESOP schemes. During the year, a provision of ` 4,287,167 (Previous year ` 3,537,253) has been made for Cash Compensation in accordance with the Guidance Note on Accounting of Employees Share Based Payments issued by the Institute of Chartered Accountant of India and a payment of ` 22,050,000/- is made to employees.

b. A demand of ` 205,089,058 has been raised by the income-tax authorities for Assessment Years 2005-06 to 2011-12 pursuant to assessment proceedings conducted under Section 153A of the Income Tax Act, 1961. The Company has �led an appeal against the said demand. However, the provisions for tax made by the Company are adequate to meet the said demand.

c. Gratuity : The revised AS -15 (Employee Bene�ts) is applicable to the Group.

Under the gratuity plan, every employee who has completed atleast �ve years of service gets a gratuity on departure @ 15 days of last drawn salary for each completed year of service. The schemes of all the Group companies except for the one joint venture SPV is unfunded.

The following table summarises the components of net bene�t expense recognised in the statement of pro�t and loss and amounts recognised in the balance sheet.

Particulars March 31, 2013 March 31, 2012Current service cost 2,284,418 1,629,104 Interest cost on bene�t obligation 559,594 403,606 Expected return on plan asset (71,823) (56,635)Actuarial (gain)/loss (463,818) (60,708)Past service cost - 156,057 2,308,371 2,071,424 Less : Gratuity capitalised 361,454 151,411 Net bene�t expense 1,946,917 1,920,013

The changes in the present value of the de�ned bene�t obligation are as follows :

Particulars March 31, 2013 March 31, 2012Opening de�ned bene�t obligation 6,533,966 4,497,122 Current service cost 2,983,681 1,629,104 Interest cost on bene�t obligation 704,309 403,605 Actuarial (gain)/loss (1,175,419) (62,573)Past service cost 131,564 Less : Bene�t paid 561,390 64,856 Closing de�ned bene�t obligation 8,485,148 6,533,966

The gratuity scheme of a joint venture SPV is funded with an insurance company in the form of a qualifying insurance policy. The details of fair value of the plan assets is as follows :

Particulars March 31, 2013 March 31, 2012Fair value of plan assets at the beginning of the year 844,977 - Expected return on plan assets 71,823 56,635 Contributions 188,511 103,571 Actuarial gain/(loss) on plan assets (179,438) (1,716)Prior year value of plan assets (4,225) 686,487 Fair value of plan assets at the end of the year 921,648 844,977

F - 68

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

The actual return on plan assets of the SPVs is presently not available.

Particulars Year ended March

31, 2013

Year ended March

31, 2012

Year ended March

31, 2011

Year ended March

31,2010

Year ended March

31, 2009Actuarial (gain)/loss (1,175,419) 264,881 1,076,164 (134,208) (60,054)Experience adjustment (1,718,246) 392,746 745,251 (209,553) 277,528 Changes in actuarial assumptions (542,827) (127,865) 328,929 (78,767) (337,582)

The principal assumptions used in determining the gratuity obligations are as follows:

Particulars Year ended March 31, 2013

Year ended March 31, 2012

Discount rate 8.75% 8.75%Expected rate of return on planned assets Not applicable Not applicableAttrition rate 2% 2%Retirement age 60 years 60 years

The estimates of future salary increases, considered in actuarial valuation take account of in�ation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

c Periodic maintenance : Hitherto, periodic maintenance cost including resurfacing expenditure required to be undertaken by the operator

under its BOT contracts at speci�ed intervals were capitalised to the project asset. From the current year, in line with industry practice, the relevant SPVs have recognised a provision for such expenditure on a systematic basis over the period for which such obligations are to be carried out. During the current year ` 282,103,000 (Previous year : ` Nil) has been provided towards periodic maintenance activity.

The movement of provisions during the year as required by Accounting Standard 29 “Provisions, Contingent Liabilities and Contingent Assets” noti�ed under the Companies (Accounting Standards) Rules, 2006, (as amended) is as under:

Employee cash compensation scheme Periodic maintenance expensesParticulars March 31, 2013 March 31, 2012 March 31, 2013 March 31, 2012Opening balance 19,506,127 16,804,235 282,103,000 - Add : Additions during the year 4,285,167 3,537,253 441,869,728 282,103,000 Less : Reversed during the year - 835,361 Less : adjusted to reserves 728,751 - Less : Utilised during the year 22,050,000 - Closing balance 1,012,543 19,506,127 723,972,728 282,103,000

11 Short-term borrowings Particulars As at

March 31, 2013 As at

March 31, 2012Loans from banks, Unsecured Short-term loans from banks - 1,200,000,000 Bank overdraft (Pledged on �xed deposit of ` 50,000,000) 787,812,481 - Intercorporate loans received (repayable on demand, unsecured) :12% Inter-corporate deposit from GIL the holding company - 736,200,000 Total short-term borrowings 787,812,481 1,936,200,000 The above amount includesSecured borrowings - - Unsecured borrowings 787,812,481 1,936,200,000

F - 69

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

12 Other current liabilities

Particulars As at March 31, 2013

As at March 31, 2012

Trade payables to micro and small enterprises - - to others 242,379,703 112,339,462 Total trade payables (A) 242,379,703 112,339,462 Other liabilities Current maturities of long-term borrowings (note 7) 3,279,598,421 3,957,372,153 Interest accrued to related parties - ICTPL 1,000,966 708,139 - GIL 79,509,600 to others 49,550,337 66,712,098 Advances received from clients 26,597,631 33,712,180 Deferred inomeDues against capital expenditure - to related party - GIL 1,123,839,198 1,162,016,701 - to others 208,475,849 31,606,140 Dues to related parties 198,689,909 257,908,634 Amount due to minority shareholders 219,001,000 170,001,000 Duties and taxes payable 55,593,256 106,518,381 Book overdraft* - 154,390,627 Others 264,535,404 219,557,062 Total other liabilities (B) 5,426,881,971 6,240,012,715 Total other current liabilities (A + B) 5,669,261,674 6,352,352,177

*Book overdraft represents cheques issued in excess of balance in current account with bank.

a. Amounts due to micro and small enterprises as de�ned under the MSMED Act, 2006 : As per the information available with the Group, there are no Micro, Small, and Medium Enterprises, as de�ned in the

Micro, Small, and Medium Enterprises Development Act, 2006, to whom the Group owes dues on account of principal or interest.

The above information regarding Micro, Small, and Medium Enterprises has been determined to the extent such parties have been identi�ed on the basis of information available with the Group.

b. Amount due to minority share holders includes share application money received from minority shareholders of VGRPPL ` 49,000,000 (Previous year : ` Nil), RCTPL ` 170,000,000 (Previous year : ` 170,000,000) and SREPL ` 1,000 (Previous year : ` 1,000).

c. Details of dues to related parties :

Particulars As at March 31, 2013

As at March 31, 2012

GIL, the holding company 1,142,785,359 1,257,182,836 BWIOTPL, joint venture entity 182,706 63,375,804 ICTPL, joint venture entity 4,042,008 3,064,434 Modern Tollroads Limited, an associate company 26,520,000 26,520,000 Ansaldocaldaie Boilers India Private Limited, a subsidiary of the holding company 150,000,000 150,000,000

1,323,530,073 1,500,143,074

F - 70

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

13

Tang

ible

ass

ets

Part

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rsFr

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uipm

ents

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Co

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Mot

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Cost

or va

luat

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As at

April

1, 20

11 26

5,884

,338

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50,37

7 99

,726,3

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5,535

,734

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12,70

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8,023

33

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0,101

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0,332

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50,66

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-

17,63

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8,

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8,72

5,867

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As at

Mar

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2 23

7,647

,966

151,3

40,70

9 27

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,563

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1,997

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17,96

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40

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/disp

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18

- 34

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As

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185,

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1,144

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37,54

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9,859

10

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5,76

4,920

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2,525

,248

Char

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- -

3,55

3,187

50

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15

13,70

0 1,

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35

- 83

1,462

5,

675,3

93

3,21

4,379

65

,654,2

72

On sa

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- -

801,4

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7,11

8,790

-

1,40

6,947

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8,418

17

3,308

22

2,098

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5,183

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,966,1

81

As at

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, 201

2 -

- 12

,836,9

21

264,4

93,85

5 51

,243

3,71

3,513

-

2,24

8,013

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4,116

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7,213

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3,666

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2,940

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1,154

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91

3,52

7,944

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- 29

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- 49

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As at

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, 201

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- 16

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3 23

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6 18

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F - 71

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

14

Inta

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2,99

9 -

713

,986

,920

O

n sa

le/d

ispo

sals

/adj

ustm

ents

240

,770

,774

-

- (2

,188

,276

) -

- 2

38,5

82,4

98

As

at M

arch

31,

201

2 2

,491

,130

,762

1

87,7

08,6

04

551

,952

,099

3

47,3

62,3

72

109

,797

,635

-

3,6

87,9

51,4

72

Char

ge fo

r the

per

iod

746

,050

,901

4

21,6

75,7

12

87,

201,

771

268

,942

,786

1

8,28

2,91

0 -

1,5

42,1

54,0

80

On

sale

/dis

posa

ls/a

djus

tmen

ts -

- 9

91,7

30

- -

- 9

91,7

30

As

at M

arch

31,

201

3 3

,237

,181

,663

6

09,3

84,3

16

638

,162

,140

6

16,3

05,1

58

128

,080

,545

-

5,2

29,1

13,8

22

Net

Blo

ckA

s at

Mar

ch 3

1, 2

012

2,5

53,8

51,5

50

5,2

05,1

91,8

41

1,6

88,7

97,3

17

8,8

53,3

08,0

13

140

,202

,365

1

25,0

00,0

00

18,

566,

351,

086

As

at M

arch

31,

201

3 9

,020

,679

,136

4

,833

,516

,129

1

,620

,902

,127

8

,655

,456

,797

1

21,9

19,4

55

125

,000

,000

2

4,37

7,47

3,64

4

Not

es:

A

. Pr

ojec

t roa

ds p

erta

ins

to th

e al

l the

cos

ts in

curr

ed b

y th

ree

SPV’

s of

the

Com

pany

, AEL

, REL

and

GIC

L fo

r the

con

stru

ctio

n of

tw

o se

para

te ro

ad h

ighw

ays

unde

r sep

arat

e co

nces

sion

agr

eem

ents

ent

ered

into

bet

wee

n th

e sa

id c

ompa

nies

an

d th

e N

HA

I. T

hese

agr

eem

ents

enc

ompa

sses

the

cons

truc

tion,

ope

ratio

n an

d m

aint

enan

ce o

f the

hig

hway

on

a Bu

ild, O

pera

te, T

rans

fer (

Ann

uity

) bas

is. T

he o

wne

rshi

p of

the

said

hig

hway

road

s is w

ith th

e G

over

nmen

t of I

ndia

and

the

said

com

pani

es h

ave

an in

tang

ible

righ

t to

rece

ive

half

year

ly a

nnui

ties

from

NH

AI u

pto

Nov

embe

r 29,

201

9 fr

om th

e da

te o

f com

men

cem

ent o

f the

com

mer

cial

ope

ratio

ns. T

he re

spec

tive

high

way

road

s de

velo

ped

by A

EL a

nd R

EL o

n ce

rti�

catio

n by

NH

AI,

bega

n co

mm

erci

al o

pera

tions

from

Oct

ober

, 200

4 an

d Se

ptem

ber 2

004

resp

ectiv

ely.

B.

Pr

ojec

t brid

ges p

erta

ins t

o th

e co

sts f

or c

onst

ruct

ion

of se

para

te b

ridge

pro

ject

s by

the

two

SPVs

’ of t

he C

ompa

ny C

BICL

and

KBI

CL. T

he d

etai

ls a

re a

s und

er:

a)

It

incl

udes

cos

ts in

curr

ed b

y CB

ICL

for

cons

truc

tion

of a

roa

d br

idge

acr

oss

the

Mat

tanc

herr

y riv

er in

Coc

hin

in t

he s

tate

of

Kera

la a

s pe

r th

e co

nces

sion

agr

eem

ent

ente

red

into

bet

wee

n th

e sa

id S

PV a

nd G

reat

er C

ochi

n D

evel

opm

ent A

utho

rity

(‘GCD

A’).

This

agr

eem

ent e

ncom

pass

es th

e co

nstr

uctio

n, o

pera

tion

and

mai

nten

ance

of t

he s

aid

brid

ge o

n a

Build

, Ope

rate

and

Tra

nsfe

r (To

ll) b

asis

. The

ow

ners

hip

of th

e br

idge

is w

ith th

e G

over

nmen

t of

Ker

ala

and

the

SPV

has a

n in

tang

ible

righ

t to

colle

ct to

ll fr

om th

e us

ers o

f the

said

brid

ge u

pto

June

6, 2

020

from

the

date

of c

omm

ence

men

t of t

he c

omm

erci

al o

pera

tions

. The

SPV

on

cert

i�ca

tion

from

GCD

A c

omm

ence

d th

e co

mm

erci

al o

pera

tions

from

Sep

tem

ber 2

6, 2

001.

b)

It in

clud

es c

osts

incu

rred

by

KBIC

L fo

r con

stru

ctio

n of

a ro

ad b

ridge

acr

oss t

he K

osi r

iver

in th

e st

ate

of B

ihar

as t

he c

once

ssio

n ag

reem

ent e

nter

ed in

to b

etw

een

the

said

SPV

and

NH

AI T

his a

gree

men

t enc

ompa

sses

the

cons

truc

tion,

op

erat

ion

and

mai

nten

ance

of t

he sa

id b

ridge

on

a Bu

ild, O

pera

te a

nd T

rans

fer (

Ann

uity

) bas

is. T

he o

wne

rshi

p of

the

brid

ge is

with

the

Gov

ernm

ent o

f Ind

ia a

nd th

e SP

V ha

s an

inta

ngib

le ri

ght t

o re

ceiv

e ha

lf ye

arly

ann

uitie

s fro

m

NH

AI u

pto

Apr

il 4,

202

7 fr

om th

e da

te o

f com

men

cem

ent o

f the

com

mer

cial

ope

ratio

ns. T

he S

PV o

n ce

rti�

catio

n fr

om N

HA

I com

men

ced

the

com

mer

cial

ope

ratio

ns fr

om F

ebru

ary

8, 2

012.

C.

Pr

ojec

t ber

ths p

erta

ins t

o al

l the

cos

t inc

urre

d by

the

SPV

of th

e Co

mpa

ny, V

SPL

for t

he c

onst

ruct

ion

of t

wo

bert

hs a

t Vis

haka

patn

am p

ort,

as p

er th

e co

nces

sion

agr

eem

ent s

igne

d by

the

SPV

with

Viz

ag P

ort T

rust

(‘VP

T’) a

stat

utor

y bo

dy

gove

rnin

g th

e en

tire

Vish

akap

atna

m p

ort.

The

se a

gree

men

ts e

ncom

pass

es th

e co

nstr

uctio

n, o

pera

tion

and

mai

nten

ance

of t

he tw

o be

rths

on

a Bu

ild, O

pera

te, T

rans

fer b

asis

. The

SPV

is a

llow

ed to

levy

cha

rges

from

the

user

s of t

he b

erth

an

d ot

her f

acili

ties o

f the

VSP

L fr

om th

e da

te o

f com

men

cem

ent o

f the

com

mer

cial

ope

ratio

ns u

pto

Nov

embe

r 203

1. T

he c

omm

erci

al o

pera

tions

on

cert

i�ca

tion

by V

PT c

omm

ence

d in

two

phas

es, P

hase

1 fr

om Ju

ly, 2

004

and

the

seco

nd

phas

e fr

om S

epte

mbe

r, 20

05.

D

. To

ll co

nces

sion

righ

ts p

erta

ins

to th

e co

sts

incu

rred

by

a SP

V of

the

Com

pany

, MN

EL fo

r con

stru

ctio

n of

a h

ighw

ay ro

ad a

s pe

r the

con

cess

ion

agre

emen

t sig

ned

betw

een

MN

EL a

nd N

HA

I. Th

is a

gree

men

t enc

ompa

sses

the

cons

truc

tion,

op

erat

ion

and

mai

nten

ance

of h

ighw

ay o

n a

Build

, Ope

rate

and

Mai

nten

ance

(Tol

l) ba

sis.

The

owne

rshi

p of

the

said

hig

hway

road

is w

ith th

e G

over

nmen

t of I

ndia

and

the

said

SPV

has

an

inta

ngib

le ri

ght t

o co

llect

toll

from

the

user

s of

th

e ro

ad u

pto

the

year

202

8 fr

om th

e da

te o

f the

com

mer

cial

ope

ratio

ns. A

s th

e co

nstr

uctio

n of

the

road

hig

hway

was

com

plet

ed in

two

phas

es, P

hase

1 i

n M

ay 2

010

and

Phas

e 2

in A

ugus

t, 20

11, t

he S

PV b

egan

com

mer

cial

ope

ratio

ns

of th

e ro

ad h

ighw

ay in

two

phas

es fr

om th

e sa

id d

ates

.E.

O

pera

tions

& m

aint

enan

ce ri

ghts

incl

udes

upf

ront

am

ount

pai

d by

the

Com

pany

to it

s ho

ldin

g co

mpa

ny, G

IL, f

or re

visi

on o

f the

term

s of

the

sub-

cont

ract

agr

eem

ent s

igne

d be

twee

n th

em fo

r Ope

ratio

ns a

nd M

aint

enan

ce o

f the

road

pr

ojec

t in

the

stat

e of

And

hra

Prad

esh.

The

sai

d up

fron

t fee

s ha

s be

en c

apita

lised

as

an in

tang

ible

ass

et w

hich

will

be

amor

tised

ove

r the

life

of t

he s

aid

agre

emen

t upt

o N

ovem

ber 2

019.

F. Li

cens

e fe

es p

erta

ins t

o th

e fe

es p

aid

by a

SPV

of t

he C

ompa

ny, I

CTP

L to

Mum

bai P

ort T

rust

(‘M

bPT’

) as p

er th

e co

nces

sion

agr

eem

ent s

igne

d be

twee

n th

em fo

r pro

vidi

ng th

e lic

ense

to c

onst

ruct

, ope

rate

and

mai

ntai

n a

o�sh

ore

cont

aine

r te

rmin

al in

the

Mum

bai P

ort.

The

said

inta

ngib

le w

ill p

rovi

de th

e rig

ht to

the

SPV

to c

harg

e th

e us

ers

of th

e o�

shor

e co

ntai

ner t

erm

inal

whe

n it

com

men

ces

oper

atio

ns. T

he in

tang

ible

will

be

amm

ortis

ed fr

om th

e da

te th

e co

mm

erci

al

oper

atio

ns c

omm

ence

s.

F - 72

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

15 Capital work-in-progress

Particulars As atMarch 31, 2013

As atMarch 31, 2012

Expenses incurred on construction, acquisition of self owned asset : 53,255,902 30,900,000 Borrowing costs 15,007,057 2,870,685 Employee bene�t expenses 6,643,967 3,779,896 Other expenses 32,855,934 27,010,489 Depreciation 167,551 83,049

107,930,411 64,644,119 Less : Capital work-in-progress written o� 1,074,513 1,074,513 Total capital work-in-progress 106,855,898 63,569,606

16 Intangible assets under development

Particulars As at March 31, 2013

As at March 31, 2012

Contract expenditure 21,007,854,599 27,899,613,429 Developer fees 1,406,629,964 995,535,996 Concession fees 53,617,905 6,000,022 Borrowing costs 4,641,295,795 5,373,442,089 Negative grant - 1,200,000,000 Employee bene�t expenses 104,295,516 56,046,670 Other expenses 549,615,611 380,300,321 Depreciation 2,446,766 792,610

27,765,756,156 35,911,731,136 Less :Miscellaneous income 7,551,717 4,715,030

27,758,204,439 35,907,016,106 Less : Capitalised during the year 7,291,139,096 14,336,176,588 Less : Intangible asset under development written o� - 5,592,736 Total intangible assets under development 20,467,065,343 21,565,246,782

17 Goodwill on consolidation

Particulars As at March 31, 2013

As at March 31, 2012

Goodwill on consolidation 620,620,849 620,620,849 Less : Capital reserve on consolidation 163,895,788 130,506,196 Net of goodwill over capital reserve 456,725,061 490,114,653 Goodwill amortised upto September 30, 2007 3,729,475 3,729,475 Total goodwill on consolidation 452,995,586 486,385,178

Goodwill which was amortised upto September 30, 2007 is now tested for impairment at the end of every reporting period.

18 Non-current investments Particulars As at

March 31, 2013Nos

As at March 31, 2012

Nos

As at March 31, 2013

`

As at March 31, 2012

`

Trade investments in associates (Unquoted ordinary equity shares of ` 10 each, unless otherwise stated)ESMSPL 2,143,950 2,143,950 14,284,420 13,896,234 Mordern Tollroads Limited 24,470 24,470 192,248 203,612 AIPL 24,450 24,450 178,601 183,446

14,655,269 14,283,292 Less : Provision for diminution in value of investment 5,552,366 7,852,366 Total non-current investments 9,102,903 6,430,926

F - 73

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

Carrying amount of investments in associate companies :

ESMSPL Modern Tollroads Limited* AIPLParticulars March

31, 2013March

31, 2012March

31, 2013March

31, 2012March

31, 2013March

31, 2012Original cost of investment 21,439,500 21,439,500 244,700 244,700 244,500 244,500 Add :Opening balance of accumulated losses (7,543,266) (10,269,213) (41,088) - (61,054) (38,475)Add : Pro�t/(Losses) during the year 110,300 2,725,947 (11,364) (41,088) (4,845) (22,579)Add : Adjustments during the year 277,886 - - - - -Closing balance of accumulated losses

(7,155,080) (7,543,266) (52,452) (41,088) (65,899) (61,054)

Carrying amount of investment 14,284,420 13,896,234 192,248 203,612 178,601 183,446

* Based on the un-audited management accounts for the year ended March 31, 2013.

19 Loans and advances

Unsecured, considered good unless stated otherwise

As at March 31, 2013 As at March 31, 2012 Particulars Non-current Current Non-current CurrentCapital advances Related parties - GIL 470,143,009 - 871,227,667 - Others 964,547,244 - 790,776,364 -

(A) 1,434,690,253 - 1,662,004,031 - DepositsSecurity deposits 15,433,493 1,234,399 13,447,607 3,409,354 Other deposits 10,227,729 127,500 10,912,426 242,500

(B) 25,661,222 1,361,899 24,360,033 3,651,854 Advance recoverable in cash or in kind Related parties - 33,507,286 1,191,119 29,413,771 Others 91,503,662 187,940,694 203,507,375 38,132,352 Considered doubtful 3,626,704 - 2,631,756 -

95,130,366 221,447,980 207,330,250 67,546,123 Less : Provision made (3,626,704) - (2,631,756) -

(C ) 91,503,662 221,447,980 204,698,494 67,546,123 Intercorporate loans given to related parties- ICTPL 30,513,248 - 5,100,000 - - GIL 1,073,466 - - -Others 63,077,498 - 45,000,000 - Considered doubtful 3,892,000 - 3,892,000 -

98,556,212 - 53,992,000 - Provision for doubtful deposits (3,892,000) - (3,892,000) -

(D) 94,664,212 - 50,100,000 - Advance income-tax, net of tax provision (E) 266,434,011 - 179,233,373 - MAT credit entitlement (F) 195,235,847 - 164,698,463 -

F - 74

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

As at March 31, 2013 As at March 31, 2012Particulars Non-current Current Non-current CurrentAdvance towards equity commitmentRelated parties - Mordern Toll roads 12,994,800 - 12,994,800 - Others 168,183,126 - - -

(G) 181,177,926 - 12,994,800 - Other loans and advancesCenvat/VAT/Service tax recoverable 25,000 47,702,411 25,000 14,788,470 Prepaid expenses 18,326,520 64,980,469 - 64,884,583

(H) 18,351,520 112,682,880 25,000 79,673,053 Total Loans and Advances (A + B + C + D + E + F + G + H) 2,307,718,653 335,492,759 2,298,114,194 150,871,030

a. Dues from related parties :

As at March 31, 2013 As at March 31, 2012Particulars Non-current Current Non-current CurrentGIL 451,216,475 30,288,938 852,418,786 27,043,827 Gammon Power Limited (GPL), a subsidiary of the holding company

20,000,000 - 20,000,000 -

ICTPL 30,513,248 3,155,077 5,100,000 2,321,673 MDEPL - 15,000 - -Modern Tollroads Limited 12,994,800 48,271 12,994,800 48,271

514,724,523 33,507,286 890,513,586 29,413,771

b. Some of the eligible SPVs' of the Group have availed the tax holiday period under section 80 IA of the Income-tax Act, 1962. As such the eligible SPVs' Group during this period of tax holiday have to pay the Minimum Alternate Tax ('MAT') based on the pro�ts as per their pro�ts in the �nancial statements during the tax holiday period. The MAT paid by these SPVs during the said tax holiday period is available for adjustment against the normal tax payable by the said SPVs after the tax holiday period. The total amount of MAT credit entitlement to these SPVs is ` 195,235,847 (Previous year : ` 164,698,463).

20 Trade receivables Unsecured, considered good unless stated otherwise

As at March 31, 2013 As at March 31, 2012Particulars Non-current Current Non-current CurrentOutstanding for a period exceeding six months from the date they are due for paymentFrom related party - GIL - 8,261,111 - 8,275,398 From others - considered good 558,704 185,051,167 - 251,624,991 - considered doubtful 21,013,096 1,834,688 - 92,174

21,571,800 195,146,966 - 259,992,563 Less : Provision for doubtful debts (21,013,096) (1,834,688) - (92,174)

558,704 193,312,278 - 259,900,389 Other receivablesFrom related parties - GIL - 41,556,772 - 61,299,991 - MDEPL - 14,938,360 - - From others - 128,641,529 - 14,332,779

- 185,136,661 - 75,632,770 Total trade receivables 558,704 378,448,939 - 335,533,159

F - 75

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

21 Other assets Unsecured, considered good unless stated otherwise

As at March 31, 2013 As at March 31, 2012Particulars Non-current Current Non-current CurrentAccrued income - 1,409,425,533 - 494,736,704 Balances in escrow bank accounts (Refer note 24) 151,055,327 151,677,578 33,505 190,776,638

151,055,327 1,561,103,111 33,505 685,513,342 Interest accrued receivableConsidered good :Related parties 2,216,670 - 18,724 - Others - 65,422,801 13,833,876 44,324,869 Considered doubtful - 692,183 - 692,183

2,216,670 66,114,984 13,852,600 45,017,052 Less : Provision made - (692,183) - (692,183)

2,216,670 65,422,801 13,852,600 44,324,869 Total other assets 153,271,997 1,626,525,912 13,886,105 729,838,211

a. Accrued income includes amounts of ` 1,174,884,534 (Previous year : ` 468,579,225) receivable from NHAI against the annuities, ` 219,460,403 (Previous year : ` 13,258,750) towards grant from NHAI, ` 11,409,681 (Previous year : ` 12,898,729) from a client and balance from others. These are unbilled revenues accrued as on March 31, 2013 to the SPVs of the Group.

b. Balances in escrow bank accounts includes an amount of ` 33,505 (Previous year : ` 33,505) of the Initial Public O�er, made by the holding company of the Group, pertains to the refund orders not encashed by the investors. This amount is transferrable to Investors Protection Fund in the year 2015.

22 Current investments

Particulars As at March 31, 2013

Nos

As at March 31, 2012

Nos

As at March 31, 2013

`

As at March 31, 2012

`Non-trade investments (valued at cost unless stated otherwise)Investment in mutual fundBirla Mutual Fund - Growth schemes 40,834.464 - 8,500,000 - Birla Mutual Fund - Growth schemes 45,638.519 - 9,500,000 - Axis Liquid Fund - Daily Dividend Reinvestment 18,741 - 9,184,279 - Total current investments 105,214 - 27,184,279 - Market value as on March 31, 2013 28,514,778 -

23 Inventories

Particulars As at March 31, 2013

As at March 31, 2012

Stores and consumables 43,382,026 35,071,346 (at lower of cost computed at weighted average rate and net realisable value)Scrap steel 7,107,060 -Construction Work in progress (EPC) (refer note below) 12,635,202 - Total inventories 63,124,288 35,071,346

The disclosures as per provisions of Clauses 38, 39 and 41 of Accounting Standard - 7 ‘Construction Contracts’ noti�ed by the Companies (Accounting Standards) Rules’ 2006, (as amended) are as under:

F - 76

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

Particulars As at March 31, 2013

As at March 31, 2012

Turnover for the year - - Aggregate Expenditure (Net of inventory adjustments) for contracts existing as at the year end, 12,635,202 - Aggregate Contract Pro�ts/Losses recognized for contracts existing as at the year end, - - Contract Advances (Net) - - Gross Amount due from Customers for contract work - - Gross Amount due to customers for contract work - -

24 Cash and cash equivalents

As at March 31, 2013 As at March 31, 2012 Particulars Non-current Current Non-current CurrentCash and cash equivalentsBalances with Scheduled Banks :in Current Accounts 568,659,619 2,308,482,949 In Bank O/D Account - Debit Balance - 5,502,989 Cash on hand 10,593,736 6,606,119 Cheques on hand 93,400 -Funds in transit - 587,800 Fixed Deposit with banks for a period less than three months 113,149,515 -

- 692,496,270 - 2,321,179,857 Other bank balancesBalances in escrow account 33,505 - 33,505 - Debt service reserve account 101,021,822 - - - Fixed Deposit with banks for a period exceeding three months - 151,677,578 - 190,776,638 Fixed Deposit under lien 50,000,000 - - - Amounts disclosed under Other assets (Refer note 21) (151,055,327) (151,677,578) (33,505) (190,776,638)

- - - - Total cash and cash equivalents - 692,496,270 - 2,321,179,857

25 Revenue from projects

Particulars Year endedMarch 31, 2013

Year ended March 31, 2012

Annuity income 3,001,808,697 1,256,664,809 Toll revenue 1,339,611,301 1,011,026,054 Revenue from advisory activities 59,271,844 - Revenue from port operations 1,350,898,363 1,249,025,570 Revenue from road maintenance 193,567,860 228,755,909 Revenue from developer activities 676,777,051 246,237,536 Total revenue from projects 6,621,935,116 3,991,709,878

During the year, one of the SPV has received bunched up annuity amounting to ` 223,125,683 (previous year : Nil) on account of the delay caused not on account of the SPV. The SPV has amortised the intangible asset proportionately for the portion related to the bunched up annuity.

F - 77

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

The Group undertakes various projects on build-operate-transfer basis as per the service concession agreements with the government authorities. During the current year, the developer fees incurred by the operator on the project with the Group were considered as exchanged with the grantor against toll collection / annuity rights from such agreements and therefore the revenue from such contracts were considered realised by the Group and not eliminated for consolidation under AS-21 Consolidated Financial Statements. The revenue during the current year from such contracts are not eliminated to the extent of ` 676,777,051 (previous year : ` 246,237,536).

26 Other operating revenue

Particulars Year ended March 31, 2013

Year ended March 31, 2012

Interest on early completion bonus - 40,257,867 Operating grant received 206,201,653 171,532,565 Income from change of scope 38,528,735 - Others 37,101,870 25,884,518 Total other operating revenue 281,832,258 237,674,950

27 Other income

Particulars Year ended March 31, 2013

Year ended March 31, 2012

Interest income on :Intercorporate deposits 7,160,901 7,192,722 Bank deposits 33,104,480 5,358,627 Others 6,403,787 12,656,532

46,669,168 25,207,881 Dividend income on current investments

- 23,870,027 Miscellaneous income :Net gain on sale of current investments 25,012,560 7,826,973 Others 5,943,260 7,463,518

30,955,820 15,290,491 Total other income 77,624,988 64,368,399

28 Project expenses

Particulars Year ended March 31, 2013

Year ended March 31, 2012

Changes in inventory of materials used in maintenance activities :Opening stock of materials 4,440,914 5,425,066 Less : Closing stock of materials 4,208,978 4,440,914

231,936 984,152 Sub-contracting expenses 352,814,240 338,318,247 Expenses towards change of scope 38,528,735 - Material handling system’s maintenance expenses 117,098,647 112,504,813 Port cargo handling expenses 471,088,122 388,371,520 Power and fuel expenses 50,589,268 47,943,194 Royalty on revenue 65,385,870 39,161,063 Penalty on shortfall of minimum guarantee throughput 11,295,732 52,826,005 Other project expenses 113,044,015 109,425,935 Periodic maintenance expenses 441,869,728 282,103,000 1,661,714,357 1,370,653,776 Total project expenses 1,661,946,293 1,371,637,928

F - 78

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

29 Employee bene�ts expense Particulars Year ended

March 31, 2013Year ended

March 31, 2012Salaries, wages and bonus 209,859,947 181,364,964 Contributions to provident fund 8,626,209 7,380,824 Directors’ remuneration including contributions to provident fund 51,145,954 46,249,330 Sta� welfare expenses 10,340,638 11,138,778 Provision for leave encashment 6,568,249 5,222,296 Provision for gratuity 1,946,917 1,920,013 Employees ‘ESOP’ compensation cost (3,519,002) (57,642)Cash alternative settlement of ESOP scheme 4,285,167 3,537,253 Total employee bene�ts expense 289,254,079 256,755,816

30 Other expenses Particulars Year ended

March 31, 2013Year ended

March 31, 2012Professional and consultancy fees 89,732,227 79,192,486 Insurance charges 5,290,311 6,146,099 Directors’ fees and commission 830,000 2,300,000 O�ce rent 13,784,347 14,556,649 Hire of equipments 3,971,430 3,259,142 Fuel charges 2,799,461 3,899,383 Travelling and motor car expenses 24,287,028 17,600,235 Tender document expenses 15,525,626 25,302,705 Payment to auditors 8,402,608 8,859,047 Preliminary and share issue expenses 30,339 22,157,363 Guarantee bond commission 4,412,226 19,602,988 Miscellaneous expenses 46,355,716 39,677,270 Assets written o� 9,914,535 10,104,861 Loss on sale of assets 5,860,832 3,376,070 Loss on divestment of joint venture - 35,412,632 Loss from joint venture * 39,945,070 11,687,090 Loss on foreign currency �uctuation 1,802,716 - Intangible asset written o� 5,575,701 - Provision for diminution in value of investments (including goodwill written o�) - 21,987,235 Provision for doubtful debts, advances & bad debts 458,495 15,457,915

278,978,668 340,579,170 Less : Transfer to intangible asset under development - - Total other expenses 278,978,668 340,579,170

*Persuant to supplementary agreement dated December 23, 2011 with Noatum Ports S.L., co-venturer in ICTPL, the group

is liable to bear and discharge all �nancial obligation and contribution in relation to ICTPL. Hence the entire loss of ICTPL has been absorbed by the Group.

31 Exceptional itemsParticulars Year ended

March 31, 2013Year ended

March 31, 2012Unamortised portion of periodic maintenance written o� - 745,405,210 Depreciation for prior years - 1,901,748 Prior period expenses capitalised written back - -

- 747,306,958 Less :Developer fees eliminated earlier, now reversed - 650,258,901

- 650,258,901 Total exceptional items - 97,048,057

a. The Group undertakes various projects on build-operate-transfer basis as per the service concession agreements with the government authorities. During the previous year, the developer fees incurred by the operator on the project with the Group were considered as exchanged with the grantor against toll collection / annuity rights from

F - 79

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

such agreements and therefore the revenue from such contracts were considered realised by the Group and not eliminated for consolidation under AS-21 Consolidated Financial Statements. The revenue during the previous year from such contracts were not eliminated to the extent of ` 246,237,536. Further, the Group has re�ected the credit of the developer fees of ` 650,258,901 upto March 31, 2011 as an exceptional item.

b. Upto March 31, 2011, periodic maintenance cost including resurfacing expenditure required to be undertaken by the operator under its BOT contracts at speci�ed intervals were capitalised to the project asset. During the previous year, in line with industry practice, the relevant SPVs have recognised a provision for such expenditure on a systematic basis over the period for which such obligations are to be carried out. Further, these SPVs have debited such un-amortised expenditure of ̀ 745,405,210 as at March 31, 2011 to the statement of pro�t and loss as an exceptional item in the previous year.

c. Exceptional items are therefore the net of the unamortised periodic maintenance expenditure written o�, ` 745,405,210, depreciation for prior years ` 1,901,748 and reversal of elimination of developer fees of ` 650,258,901 resulting in a net debit of ` 97,048,057.

32 Finance costsParticulars Year ended

March 31, 2013Year ended

March 31, 2012Interest expense

- to banks, �nancial institution and others 2,877,147,413 1,371,571,157

- to related parties

- GIL on intercorporate loans 37,050,612 88,344,000

- ICTPL on margin money 300,000 300,000

- to joint venture partners 14,126,965 -

Other �nance costs 39,712,593 96,378,817

Total �nance cost 2,968,337,583 1,556,593,974

33 Signi�cant accounting policies and notes to this consolidated �nancial statement are intended to serve as a means of informative disclosure and a guide to better understanding the consolidated position of the companies. Recognising this purpose, the Group has disclosed only such policies and notes from the individual �nancial statements, which fairly presents the needed disclosures.

34 Annuity receivable by CBICL Under the Concession Agreement dated 27th October, 1999, executed between CBICL, GIL the holding company of the

Group, Government of Kerala (GOK) and Greater Cochin Development Authority (GCDA) dated January 6th, 2001; the entire project has been assigned to CBICL as a Concessionaire for the purpose of developing, operating and maintaining the infrastructure facility on BOT basis for 13 years and nine months.

Subsequently, a Supplementary Concession Agreement is to be executed as per the Government of Kerala’s Order Nos. G.O.

(M.S.) No. 11/2005/PWD dated 24th January, 2005 and G.O. (M.S) No. 16/2005/PWD dated 1st March, 2005 between the Government of Kerala, Greater Cochin Development Authority and CBICL. In terms of the order, the period of concession has been increased by 6 years and CBICL is entitled to yearly annuity receipts which it is accounting as Trade receivables. The annuities have not been collected till date. CBICL has not made any provision against the said receivables. As the annuities has not been received till date, CBICL has initiated arbitration procedures.

F - 80

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

35 Earnings per share (EPS)Particulars Year ended

March 31, 2013Year ended

March 31, 2012Pro�t/(loss) after tax 147,263,253 (254,181,145)

Outstanding equity shares at the end of the year 734,026,438 728,763,618

Weighted average number of equity shares outstanding during the year - Basic 734,026,438 728,755,992

Weighted average number of equity shares outstanding during the year - Diluted 734,180,933 729,105,907

Earnings Per Share - Basic (`) 0.20 (0.35)

Earnings Per Share - Diluted (`) 0.20 (0.35)

Particulars As at March 31, 2013

As at March 31, 2012

Nominal value of equity shares (` per share) 2 2

For Basic EPS :

Total number of equity shares outstanding at the beginning of the year 728,763,618 728,740,162

Add : Issue of equity shares against options granted to employees - 23,456

Add : Issue of Bonus Shares during the year 5,262,820 -

Total number of equity shares outstanding at the end of year 734,026,438 728,763,618

Weighted average number of equity shares at the end of the year 734,026,438 728,755,992

For Dilutive EPS :

Weighted average number of shares used in calculating basic EPS 734,026,438 728,755,992

Add : Equity shares for no consideration arising on grant of stock options under ESOP 3,565,448 3,565,448

Less : Equity shares for no consideration arising on grant of stock options under ESOP forfeited / lapsed (included above) 3,410,953 3,215,533

Weighted average number of equity shares used in calculating diluted EPS 734,180,933 729,105,907

The weighted average number of shares of the previous year includes 5,262,820 bonus shares issued during the year for the purpose of computing EPS in accordance with AS-20 Earnings per Share.

GIPL, the holding company was an unlisted company at the date when options were granted under GIPL ESOP 2007 scheme and therefore the intrinsic value was determined on the basis of an independent valuation by following the price to Net Asset Value (NAV) method. If the employees stock based compensation cost been determined in accordance with the fair value approach described in the guidance note, the Group’s net pro�t for the year ended March 31, 2013 as reported would have changed to amounts indicated below:

F - 81

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

Particulars Year ended March 31, 2013

Year ended March 31, 2012

Pro�t after tax as reported 147,263,253 (254,181,145)

Add: Stock based compensation expense included in the reported income 46,247 (57,642)

Less: Stock based compensation expenses determined using fair value of options

233,195 7,760,545

Net Pro�t (adjusted) 147,076,305 (261,999,332)

Earnings Per Share :

Basic earnings per share as reported 0.20 (0.35)

Basic earnings per share (adjusted) 0.20 (0.36)

Diluted earnings per share as reported 0.20 (0.35)

Diluted earnings per share (adjusted) 0.20 (0.36)

Weighted average number of equity shares at the end of the year 734,026,438 728,755,992

Weighted average number of shares considered for diluted earnings per share (adjusted) 734,180,933 729,105,907

36 Lease One of the SPV has taken land on lease from Visakhapatnam Port Trust under non-cancellable operating lease agreements

and temporary housing from others under cancellable operating lease agreements. Total rental expense under non-cancellable operating lease was ` 9,210,235 (Previous year: ` 5,938,636) and under cancellable operating leases was ` 818,810 (Previous year: ` 661,604) which has been disclosed as lease rentals in the statement of pro�t and loss.

Further, another SPV has also taken an o�ce premises on a non-cancellable operating lease. The monthly lease rents amounts to ` 950,000 (Previous year : ` 950,000). The disclosures as per Accounting Standard 19 ‘Leases’ noti�ed under the Companies (Accounting Standards) Rules, 2006 are as under:

Particulars March 31, 2013 March 31, 2012

Minimum lease payments :

Payable not later than 1 year 12,084,000 12,084,000

Payable later than 1 year and not later than 5 years 22,686,000 34,086,000

Payable later than 5 years - -

Lease payment recognised in the statement of pro�t and loss 1,299,713 6,911,469

F - 82

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

37 Related party transactions a. Names of the related parties and related party relationships i) Entities where control exists : GIL the holding company

ii) Fellow subsidiary : GPL subsidiary of the holding company, GIL ACBIPL subsidiary of the holding company, GIL

iii) Associates : AIPL ESMSPL Modern Tollroads Limited

iv) Key management personnel : Abhijit Rajan Kishor Kumar Mohanty Parag Parikh Rajeevkumar Malhotra

b. Related party transactions Transactions Entities

where control exists

Associates Fellow subsidiary

Key management

personnel

Total

Operations and maintenance income from :GIL 192,104,620 192,104,620

(181,382,669) (181,382,669)Operations & maintenance expenses :GIL 192,068,481 192,068,481

(181,382,669) (181,382,669)Intangible asset development (materials supply) :GIL 105,298,277 105,298,277

(491,756,326) (491,756,326)Intangible asset development (contract expenditure) :GIL 2,936,192,456 2,936,192,456

(6,704,333,405) (6,704,333,405)Advances given against EPC contracts to : GIL 112,311,912 112,311,912

(254,173,425) (254,173,425)Advances recovered against EPC contracts from :GIL 204,859,918 204,859,918

(152,603,934) (152,603,934)Advance against material supply liquidated :GIL - -

(135,000,000) (135,000,000)Advance against labour recovered :GIL 135,000,000 135,000,000

- - Advance against material supply recovered :GIL 124,915,434 124,915,434

- - Rent paid to :GIL - -

(700,000) (700,000)

F - 83

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

Transactions Entities where control

exists

Associates Fellow subsidiary

Key management

personnel

Total

Insurance claims received from : GIL - -

- - Insurance claims transferred to : GIL 1,626,398 1,626,398

(712,654) (712,654)Managerial remuneration :Mr. Kishor Kumar Mohanty 25,845,378 25,845,378

(22,173,328) (22,173,328)Mr. Parag Parikh 16,999,844 16,999,844 (6,708,482) (6,708,482)Mr. R.K. Malhotra 8,300,732 8,300,732

(11,367,520) (11,367,520)Bonus shares issued (no. of shares):- Mr. Abhijit Rajan 836,602 836,602

- - - Mr. K. K. Mohanty 2,956 2,956

- - - Mr. R. K. Malhotra 2,648 2,648

- - - Mr. Parag Parikh 7,206 7,206

- - Finance provided (incl. Loans and equity contribution in cash or in kind) :GIL 750,000,000 750,000,000

- - Finance provided for expenses and on account payments :GIL 7,696,902 7,696,902

(1,026,119) (1,026,119)Amount liquidated towards the above �nance :GIL 748,926,534 748,926,534

(836,284) (836,284)Intercorporate borrowings from :GIL 190,000,000 190,000,000

- - Finance received for expenses & on account payments :GIL 1,022,507 1,022,507

(275,894) (275,894)Refund of intercorporate borrowings to :GIL 926,404,066 926,404,066

(2,042,237) (2,042,237)Interest income during the period :GIL 936,986 936,986

- - Interest paid during the year to :GIL 37,050,612 37,050,612

(88,344,000) (88,344,000)Retention money recovered :GIL 7,421,777 7,421,777

(152,392,455) (152,392,455)Retention money refunded :GIL 7,421,777 7,421,777

(155,905,258) (155,905,258)Outstanding balances receivable :Modern Tollroads Limited 13,043,071 13,043,071

(13,043,071) (13,043,071)Gammon Power Ltd 20,000,000 20,000,000

(20,000,000) (20,000,000)Outstanding balances payable :GIL 671,356,789 671,356,789

(1,654,998,546) (1,654,998,546)Modern Tollroads Limited 26,520,000 26,520,000

(26,520,000) (26,520,000)ACBIPL 150,000,000 150,000,000

(150,000,000) (150,000,000)

(Previous year’s �gures in brackets)

F - 84

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

38 Contingent liabilities

Group’s share in contingent liability not provided for in the books of accounts.

Particulars As at March 31, 2013

As at March 31, 2012

Claims against Company not acknowledged as debt 1,017,672,971 308,162,328 Total 1,017,672,971 308,162,328

a. The contingent liability, detailed hereinabove includes the Group’s share of contingent liability in the joint venture companies amounting to ` Nil (Previous year : ` Nil).

b. Claims against the SPVs of a Group not acknowledged as debt includes

i) During the year, some of the subsidiaries of the Group has received block assessment orders raising demand u/s 143(3) read with section 153(A) of the Income Tax Act, 1961 for assessment years from 2005-06 to 2011-12 totalling to ` 756,113,922. The subsidiaries of the Group are of the view that the said Orders are unjusti�ed and unsustainable and hence is in the process of �ling appeals against the said assessment Orders with the Commissioner of Income-Tax (Appeals). Since the subsidiaries of the Group proposes to appeal against these orders, they believe that no liability will ultimately result from these and accordingly no provision has been made in these �nancial statements in respect of these amounts.

ii) An amount of ` 177,699,900 claimed by the collector and district registrar, Rajahmundry, pursuant to and Order dated March 15, 2005, as de�cit stamp duty payable on the concession agreement entered into between a subsidiary of the Group and NHAI, classifying the concession agreement as a ‘lease’ under Article 31(d) of the Indian Stamp Act. The subsidiary has impugned the Order by way of a writ petition before the High Court of Andhra Pradesh at Hyderabad. No provision is considered necessary in respect of the said demand, as the management of the subsidiary believes that there is no contravention of the Indian Stamp Act.

c. A winding up petition against a subsidiary of the Group, has been �led by a creditor for recovery of `14,140,343. The subsidiary is disputing the said amount and has recognised `1,685,168 payable as there are claims and counter claims by both parties. Pending the �nal outcome of such proceeding, the claim from the trade payable is disclosed as a contingent liability. The management of the said is of the view that the same would be settled and does not expect any additional liabilities towards the same.

39 Commitments a. Capital commitments The total capital commitment as on March 31, 2013 is ` 76,437,229,519 (Previous year :` 9,018,442,874).The capital

commitments are in respect of projects where the concession agreements have been signed and does not include projects where only Letters of Intents are held.

b. Export obligations

Particulars As at March 31, 2013

As at March 31, 2012

Under EPCG Scheme 228,966,912 228,966,912 Total 228,966,912 228,966,912

c. Other commitments

i) In terms of the individual Contracts signed by SPVs they are required to carry major periodic maintenance of the roads they are operating as a part of commitment against receipt of Tolling Rights and / or Annuities. The said SPVs have made provisions towards the same in their respective �nancial statements.

ii) One of the SPV’s engaged in generating power from a bagasse power plant has committed to purchase bagasse when the power plant becomes operational. The total commitment to purchase the bagasse, upto March 31, 2013, is ` 65,000,000 (Previous year : ` 60,000,000).

F - 85

Consolidated Financial Statements

Notesto the Consolidated financial statements for the year ended March 31, 2013(All amounts in Indian Rupees unless otherwise stated)

40 Segment reporting The Group’s operations constitutes a single business segment namely “Infrastructure Development” as per Accounting Standard (AS) - 17 “Segment Reporting”. Further the Group’s operations are within single geographical segment which is India.

Infrastructure activities comprise of all the activities of investing in infrastructure projects, providing advisory services and operating and maintaining of Public Private Partnership Infrastructure Projects.

41 Remuneration to auditors of the subsidiaries and joint ventures not audited by any of the joint auditors of the Company is grouped with professional fees.

42 Derivative Instruments and Unhedged Foreign Currency Exposure One SPV of the Group has the following unhedged exposure in foreign currency representing Buyers credit as at March 31,

2013 and March 31, 2012.

Particulars As at March 31, 2013

As at March 31, 2012

Currency EURO Foreign Currency - 1,491,450 Indian ` - 101,241,073

43 Previous years �gures have been regroupped/reclassi�ed wherever necessary.

As per our report of even date For and behalf of the Board of Directors of Gammon Infrastructure Projects Limited

For Natvarlal Vepari & Co. For S. R. Batliboi & Co. LLP Abhijit Rajan Himanshu ParikhICAI Firm Regn. No.: 106971W ICAI Firm Regn. No. : 301003E Chairman and Vice Chairman Chartered Accountants Chartered Accountants Managing Director

N Jayendran per Hemal Shah Kishor Kumar Mohanty Parag ParikhPartner Partner Managing Director Whole-time Director and CFO Membership No. : 40441 Membership No. : 42650

C. C. Dayal Naresh Chandra Director Director

S. C. Tripathi Homai A. Daruwalla Director Director

Place : Mumbai G. Sathis Chandran Place : Mumbai Date : May 24, 2013 Company Secretary Date : May 24, 2013

F - 86

The Board of DirectorsGammon infrastructure Projects limited

1. We have audited the attached Consolidated Balance Sheet of Gammon Infrastructure Projects Limited (‘GIPL’ or ‘the Company’) Group (‘the Group’ or ‘GIPL Group’), as at March 31, 2012, and also the Consolidated Statement of Profit and Loss and the Consolidated Cash Flow statement for the year ended on that date annexed thereto. These Consolidated Financial Statements are the responsibility of GIPL’s management and have been prepared by the management on the basis of separate financial statements and other financial information regarding components. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. We did not audit the financial statements of

a. certain subsidiaries whose financial statements reflect total assets of ` 14,974,138,891 as at March 31, 2012, total income of ` 1,324,397,073 and cash flows of ` 1,850,800,719 for the year then ended;

b. certain joint venture companies whose financial statements reflect total assets of ` 75,092,367 as at March 31, 2012, the total income of ` 2,023,416 and cash flows amounting to ` -1,869,942 for the year then ended, the Company’s share of such assets, total income and cash flows being ` 23,298,151, ` 627,259 and ` -583,572 respectively and

c. Certain associates whose financial statements reflect a total profit of ` 9,199,619 for the year ended March 31, 2012, the Company’s share in the profits of such associates being ` 2,662,280.

The above mentioned financial statements have been audited by other auditors whose reports have been furnished to us, and our opinion is based solely on the report of other auditors except for the financial statements of joint ventures and associates referred to in point 3 (b) and (c) above, which are based on unaudited financial statements certified by the respective managements of the said joint ventures whose financial statements reflect total assets of ` 75,092,367 as at March 31, 2012, total income of ` 2,023,416 and cash flows of ` (1,869,942) for the year then ended, the Company’s share of such assets, total income and cash flows being ` 23,298,151, ` 627,259 and ` (583,572) respectively and the said associates whose financial statements reflect a total profit of ` 9,199,619 for the year ended March 31, 2012, the Company’s share in the profits of such associates being ` 2,662,280.

In respect of the other subsidiaries and joint ventures, the audit has been conducted by either of us and the audit of GIPL has been conducted by us jointly.

4. We report that the Consolidated Financial Statements have been prepared by GIPL’s management in accordance with the requirements of Accounting Standard (AS) 21, Consolidated financial statements, (AS) 23, Accounting for Investments in Associates in Consolidated Financial Statements and (AS) 27, Financial Reporting of Interests in Joint Ventures notified pursuant to the Companies (Accounting Standards) Rules, 2006 (as amended).

5. Based on our audit and on consideration of reports of other auditors on the financial statements and of the other financial information of the components, and to the best of our information and according to the explanations given to us, we are of the opinion that the attached Consolidated Financial Statements give a true and fair view in conformity with the accounting principles generally accepted in India:

a. in the case of the consolidated Balance Sheet, of the state of affairs of the GIPL Group as at March 31, 2012;

b. in the case of the consolidated Statement of Profit and Loss, of the loss of the GIPL Group for the year ended on that date; and

c. in the case of the consolidated Cash Flow Statement, of the cash flows of the GIPL Group for the year ended on that date.

For natvarlal Vepari & Co. For s.R. Batliboi & Co.Firm Registration Number : 106971W Firm Registration Number : 301003EChartered Accountants Chartered Accountants

n Jayendran per Hemal shahPartner PartnerM.No. 40441 M.No. 42650Mumbai, Dated : May 9, 2012 Mumbai, Dated : May 9, 2012

auditors’ Report

F - 87

Notes As at March 31, 2012

As at March 31, 2011 Particulars

equity and liaBilitiesshareholders’ fundsShare capital 4 1,465,629,736 1,465,582,824 Reserves and surplus 5 5,984,247,424 5,448,327,900

7,449,877,160 6,913,910,724

Minority interest 6 1,219,772,941 836,765,506

non-current liabilitiesLong-term borrowings 7 30,388,521,028 23,778,295,414 Deferred tax liabilities (net) 8 25,644,794 26,638,707 Trade payables, non-current - - Other long-term liabilities 9 8,850,000 8,850,000 Long-term provisions 10 299,201,125 27,457,257

30,722,216,947 23,841,241,378 Current liabilitiesShort-term borrowings 11 1,936,200,000 946,220,927 Trade payables, current 12 112,339,462 117,353,740 Other current liabilities 12 6,240,012,715 4,633,307,414 Short-term provisions 10 129,170,460 50,575,888

8,417,722,637 5,747,457,969 total 47,809,589,685 37,339,375,577 assetsnon-current assetsFixed assets :

Tangible assets (net) 13 1,237,112,205 1,537,967,664 Intangible assets (net) 14 18,566,351,086 11,449,699,811 Capital work in progress 15 63,569,606 53,184,318 Intangible assets under development 16 21,565,246,782 18,930,257,152 Goodwill on consolidation 17 486,385,178 516,385,178

Deferred tax asset - - Non-current investments 18 6,430,926 11,621,004 Long-term loans and advances 19 2,298,114,194 2,276,512,995 Non-current trade receivables 20 - - Other non-current assets 21 13,867,381 7,956,383

44,237,077,358 34,783,584,505 Current assetsCurrent investments 22 - 30,000,000 Inventories 23 35,071,346 77,705,757 Trade receivables 20 335,533,159 305,319,127 Cash and cash equivalents 24 2,511,956,495 1,491,658,581 Short-term loans and advances 19 150,871,030 137,512,116 Other current assets 21 539,080,297 513,595,491

3,572,512,327 2,555,791,072 total 47,809,589,685 37,339,375,577 Summary of significant accounting policies 2.1

Consolidated Balance sheet as at March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

The accompanying notes are an integral part of the financial statements.

As per our report of even date For and on behalf of the Board of Directors of Gammon Infrastructure Projects Limited

For natvarlal Vepari & Co. For s.R. Batliboi & Co. abhijit Rajan Himanshu Parikh Kishor Kumar MohantyFirm Registration No.: 106971W Firm Registration No.: 301003E Chairman and Vice Chairman Managing DirectorChartered Accountants Chartered Accountants Managing Directorn. Jayendran per Hemal shah Parag Parikh R. K. Malhotra C. C. dayalPartner Partner Whole-time Director Whole-time Director DirectorMembership No : 40441 Membership No: 42650 & CFO

sanjay sachdev naresh Chandra s. C. tripathiDirector Director DirectorHomai a. daruwallaDirectorG. sathis ChandranCompany Secretary

Place : Mumbai Place : MumbaiDate : May 9, 2012 Date : May 9, 2012

F - 88

As at March 31, 2012

As at March 31, 2011

inCoMeRevenue from operations:

Revenue from projects 25 3,991,709,878 3,165,842,279 Other operating revenue 26 237,674,950 192,805,744

Other income 27 64,368,399 100,341,142 total inCoMe (A) 4,293,753,227 3,458,989,165

exPenses Project expenses 28 1,374,391,539 938,518,655 Employee benefits expense 29 256,755,816 182,320,198 Other expenses 30 337,825,559 228,575,126 Exceptional items 31 97,048,057 - total exPenses (B) 2,066,020,971 1,349,413,979

earnings before interest, tax, depreciation and amortisation (eBitda) (A - B) 2,227,732,256 2,109,575,186 Finance costs 32 1,556,593,974 999,571,159 Depreciation/amortisation 33 778,992,304 849,133,098 Share of (profit) from investment in associates (2,662,280) (5,511,190)

Profit/(Loss) before tax (105,191,742) 266,382,119 Less : Tax expenses :

Current tax 133,389,441 183,560,528 Deferred tax (charge) / credit (993,913) 112,749 MAT credit entitlement (17,140,000) (137,667,481)Short/(excess) provision of tax relating to earlier years - 238,053

Net current tax expense 115,255,528 46,243,849

Profit/(Loss) after tax (220,447,270) 220,138,270 Less : Profit after tax attributable to minority interest 33,733,875 48,452,098 Profit attributable to group shareholders (254,181,145) 171,686,172 earnings per share (‘ePs’) 37 Basic (0.35) 0.24 Diluted (0.35) 0.24 Nominal value of equity share 2.00 2.00 Summary of significant accounting policies 2.1

Consolidated Statement of Profit and Loss for the year ended March 31, 2012 (All amounts in Indian Rupees unless otherwise stated)

The accompanying notes are an integral part of the financial statements.

As per our report of even date For and on behalf of the Board of Directors of Gammon Infrastructure Projects Limited

For natvarlal Vepari & Co. For s.R. Batliboi & Co. abhijit Rajan Himanshu Parikh Kishor Kumar MohantyFirm Registration No.: 106971W Firm Registration No.: 301003E Chairman and Vice Chairman Managing DirectorChartered Accountants Chartered Accountants Managing Directorn. Jayendran per Hemal shah Parag Parikh R. K. Malhotra C. C. dayalPartner Partner Whole-time Director Whole-time Director DirectorMembership No : 40441 Membership No: 42650 & CFO

sanjay sachdev naresh Chandra s. C. tripathiDirector Director DirectorHomai a. daruwallaDirectorG. sathis ChandranCompany Secretary

Place : Mumbai Place : MumbaiDate : May 9, 2012 Date : May 9, 2012

F - 89

Particulars Year ended March 31, 2012 Year ended March 31, 2011

a. CasH FloW FRoM oPeRatinG aCtiVities :

Profit before tax (105,191,742) 266,382,119 Adjustments for : Employees stock options (57,642) (226,898)Cash alternative settlement for ESOP scheme 3,537,253 11,436,424 Depreciation and amortisation 778,992,304 849,133,098 Gratuity and leave encashment 7,142,309 4,366,356 Dividend income (23,870,027) (36,727,994)Interest (net) 1,531,386,093 964,121,131 (Profit)/Loss on sale of investments (7,826,973) (12,148,354)Share of (profit) from investment in associates (2,662,280) (5,511,190)Loss on sale of assets 3,376,070 1,898,849 Assets written off 10,104,861 30,356,310 Provision for periodic maintenance expenses 282,103,000 - Provision for loans and advances/other assets 15,457,915 21,310,640 Provision for diminution in value of investment 21,987,235 - Exceptional items 97,048,057 - Preliminary and share issue expenses written off 22,157,363 9,659,752

2,738,875,538 1,837,668,124 Operating profit before working capital changes 2,633,683,796 2,104,050,243 Adjustments for :Trade and other receivables (164,673,206) 27,972,447 Trade payables and working capital finance 249,415,630 116,708,437 Inventories 42,634,411 (8,865,465)

127,376,835 135,815,419 Cash generated from the operations 2,761,060,631 2,239,865,662 Direct taxes paid (171,703,881) (233,524,146)net cash from operating activities 2,589,356,750 2,006,341,516

B. CasH FloW FRoM inVestMent aCtiVities :

Capital purchases after adjusting capital creditors (9,822,775,344) (8,394,796,554) Proceeds on sale of fixed assets 186,000 2,359,327 Purchase of investments : - Mutual funds (5,239,927,251) (7,114,938,599) Sale of investments : - Mutual funds 5,263,797,278 7,176,451,505 - Market investments 37,826,973 12,148,354 Intercorporate deposits given: - Granted during the year (25,100,000) (185,800,000) - Repayments received during the year 15,000,000 156,849,000 Advances from/(to) joint venture companies 77,044,541 (41,066,595)Advances received from related parties - 150,000,000 Advance paid to partnership firm - (400,000,000)Amount received from minority shareholders (370,030,000) -Disposal /(acquisition) of stake in joint venture companies 865,131 - Interest received 33,549,967 3,138,330 Dividend received - 20,880 net cash used in investment activities (10,029,562,705) (8,635,634,352)

Consolidated Cash Flow statement for the period ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 90

Particulars Year ended March 31, 2012 Year ended March 31, 2011

C. CasH FloW FRoM FinanCinG aCtiVities :

Proceeds from equity share capital 300,002 66,072,757 Capital grant received 876,990,000 164,280,000 Proceeds from borrowings 17,525,056,594 8,844,193,546 Repayment of loans (8,795,480,794) (1,701,686,632)Disposal of equity stake to minority share holder 349,273,560 504,730,305 Interest paid (1,473,478,130) (956,368,206) Preliminary and share issue expenses (22,157,363) (9,698,752)net Cash From Financing activities 8,460,503,869 6,911,523,018 NET INCREASE IN CASH AND CASH EQUIVALENTS 1,020,297,914 282,230,182

Cash and cash equivalents, end of the year 2,511,956,495 1,491,658,581 Cash and cash equivalents, beginning of the year 1,491,658,581 1,209,428,399 NET INCREASE IN CASH AND CASH EQUIVALENTS 1,020,297,914 282,230,182

Components of Cash and Cash equivalents : Cash and cheques on hand 6,606,119 3,601,925 Funds in transit 587,800 28,104,528 With banks : On current accounts 2,313,985,938 1,371,189,410 On deposit accounts 190,776,638 88,762,718 Cash and cash equivalents, end of the year 2,511,956,495 1,491,658,581

Summary of significant accounting policies 2.1

Consolidated Cash Flow statement for the period ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

The accompanying notes are an integral part of the financial statements.

As per our report of even date For and on behalf of the Board of Directors of Gammon Infrastructure Projects Limited

For natvarlal Vepari & Co. For s.R. Batliboi & Co. abhijit Rajan Himanshu Parikh Kishor Kumar MohantyFirm Registration No.: 106971W Firm Registration No.: 301003E Chairman and Vice Chairman Managing DirectorChartered Accountants Chartered Accountants Managing Directorn. Jayendran per Hemal shah Parag Parikh R. K. Malhotra C. C. dayalPartner Partner Whole-time Director Whole-time Director DirectorMembership No : 40441 Membership No: 42650 & CFO

sanjay sachdev naresh Chandra s. C. tripathiDirector Director DirectorHomai a. daruwallaDirectorG. sathis ChandranCompany Secretary

Place : Mumbai Place : MumbaiDate : May 9, 2012 Date : May 9, 2012

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1 BaCKGRound

Gammon Infrastructure Projects Limited a listed company and its subsidiaries, joint ventures and associates, are engaged in the development of various infrastructure projects under the Public Private Partnership (‘PPP’) model in sectors like transportation, energy and urban infrastructure through several special purpose vehicles (“SPVs”). Each project is governed by a separate concession agreement (‘the Contract’) signed between the client (‘grantor’) and the SPV. Majority of the projects secured are from the Government, (Central or State) or an organistation or body floated by the Government.

2 aCCountinG PoliCies

a. Basis of preparation

The Consolidated Financial Statements have been prepared to comply in all material respects with the notified accounting standards by the Companies (Accounting Standards) Rules, 2006 (as amended). The consolidated financial statements have been prepared under the historical cost convention, on an accrual basis of accounting. The accounting policies are consistent with those used in the previous year, except for the changes in the accounting policies explained below in note 2.1(a).

b. Principles of consolidation

i) Holding company and subsidiaries :

The Consolidated Financial Statements comprise the financial statements of GAMMON INFRASTRUCTURE PROJECTS LTD. (“the Company”) and its Subsidiary companies (the Company and its subsidiaries are hereinafter referred to as ‘the Group’). The Consolidated Financial Statement has been prepared on the following basis:

The Financial Statements of the Company and its subsidiary companies have been combined on a line by line basis by adding the book values of like items of assets, liabilities, income and expenses, after fully eliminating intra-group balances, intra-group transactions and unrealised profits or losses as per Accounting Standard - 21 (‘AS-21’) “Consolidated Financial Statements” notified under the Companies (Accounting Standards) Rules, 2006.

The Consolidated Financial Statements have been prepared using uniform policies for like transactions and other events in similar circumstances and are presented to the extent possible in the same manner as the Company’s separate financial statements.

The excess of cost of investments of the Group over its share of equity in the subsidiary is recognised as goodwill. The excess of share of equity of subsidiary over the cost of investments is recognised as capital reserve.

ii) interest in joint venture companies :

The Group’s interest in the joint ventures, in the nature of jointly controlled entities are included in these consolidated financial statements using the proportionate consolidation method as per the Accounting Standard – 27 (‘AS-27’) “Financial Reporting of Interests in Joint Ventures” notified under the Companies (Accounting Standards) Rules, 2006 (as amended). The Group combines its share of each of the assets, liabilities, income and expenses of the joint venture with similar items, on a line by line basis.

iii) investments in associate companies :

Investments in associate companies are accounted under the equity method as per the Accounting Standard – 23 (‘AS-23’) “Accounting for Investments in Associates in Consolidated Financial Statements” notified under the Companies (Accounting Standards) Rules, 2006 (as amended).

Under the equity method, the investment in associates is carried in the balance sheet at cost plus post acquisition changes in the Group’s share of net assets of the associate. The statement of profit and loss reflects the Group’s share of the results of operations of the associates.

The excess of the Group’s cost of investment over its share of net assets in the associate on the date of acquisition of investment is disclosed as goodwill. The excess of the Group’s share of net assets in the associate over the cost of its investment is disclosed as capital reserve. Goodwill / Capital Reserve is included/adjusted in the carrying amount of the investment.

c. Revised schedule Vi

Till the year ended March 31, 2011, the Company was preparing the financial statements as per the pre-revised Schedule VI to the Companies Act, 1956. During the year ended March 31, 2012, the Revised Schedule VI notified under the Companies Act, 1956, has become applicable to the Company. the Company has reclassified the published previous year figures to conform to the norms of the Revised Schedule VI. The adoption of the revised Schedule VI does not impact recognition and measurement principles followed for preparation of the financial statements. However, it significantly impacts presentation and disclosures made in the financial statements, particularly presentation of Balance Sheet.

The accounting policies adopted in the preparation of financial statements are consistent with those used in the previous year, except for the change in accounting policies explained below.

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

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2.1 Summary of other significant accounting policies

a. Change in the accounting policy

i) Periodic maintenance :

Until March 31, 2011, expenditure incurred by the SPVs of the Group on periodic maintenance were capitalised on completion of the said activity and amortised over the earlier of the period over which the next periodic maintenance was due or the period until the end of the concession.

With effect from March 31, 2012, periodic maintenance costs including resurfacing expenditure required to be undertaken by the SPVs as per the Contract are recognised as a provision on a systematic basis over the period for which such obligations are to be carried out (refer note 31).

ii) developer fees :

Developer fees incurred by the Group are considered as exchanged with the grantor against toll collection / annuity rights from the Con-tracts signed with the grantor and the revenue is considered as realised by the Group and not eliminated on consolidation under AS-21 Consolidated Financial Statements (refer note 31).

iii) inventory :

The Group has changed the method of valuation of inventory from First in First Out (‘FIFO’) to the Weighted Average Method of valuing the inventory.

b. use of estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period end. Although these estimates are based upon management’s best knowledge of current events and actions, actual results could differ from these estimates.

c. Revenue recognition

Revenue is recognised to the extent, that it is probable that the economics benefits will flow to the Group and the revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is recognised.

i) infrastructure development business :

Toll revenue from operations of tollable roads is recognised on usage and recovery of the usage charge thereon.

The cash compensation due on account of multiple entries of cars has been accounted on accrual basis as per the order of Government of Kerala for which Supplementary Concession Agreement is being worked out between the Government of Kerala, Greater Cochin Develop-ment Authority and Cochin Bridge Infrastructure Company Limited (a Group company).

The annuity income earned from Build, Operate, Transfer (‘BOT’) projects is recognised on a time basis over the period during which the annuity is earned. Revenues from bonus and other claims are recognised upon acceptance from customer / counterparty.

Revenue by way of berth hire charges, dust suppression charges, cargo handling charges, plot rent, wharfage, barge freight, other charges etc. are recognised on an accrual basis and is billed as per the terms of the contract with the customers at the rates approved by Tariff Authority for Marine Ports (TAMP) as the related services are performed.

Other operating income is recognised on an accrual basis when the same is due.

ii) operations and maintenance revenues :

Revenue on Operations & Maintenance (O & M) contracts are recognised over the period of the contract as per the terms of the contract.

iii) Construction contract revenues :

Revenue from construction contracts is recognised on the basis of percentage completion method. The percentage of work completed is determined by the expenditure incurred on the job till date to the total expected expenditure of the contract.

Construction contracts are progressively evaluated at the end of each accounting period. On contracts under execution which have rea-sonably progressed, profit is recognised by evaluation of the percentage of work completed at the end of the accounting period, whereas, foreseeable losses are fully provided for in the respective accounting period.

iv) interest income :

Interest Income is recognised on a time proportion basis taking into account the amount outstanding and the rate applicable.

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 93

v) dividend income :

Dividend is recognised when the shareholders’ right to receive payment is established by the balance sheet date.

d. Tangible fixed assets

Tangible fixed assets are stated at cost net of accumulated depreciation and accumulated impairment losses, if any. Cost comprises the pur-chase price and any attributable cost of bringing the asset to its working condition of its intended use. The costs comprises of the purchase price, borrowings costs if capitalisation criteria are met and directly attributable costs of bringing the asset to its working condition for the intended use. Any trade discounts and rebates are deducted in arriving at the cost of the tangible fixed asset. Any subsequent expenses related to a tangible fixed asset is added to its book value only if it increases the future benefits from the existing asset beyond its previously assessed standard of performance. All other day to day repairs and maintenance expenditure and the cost of replacing parts, are charged to the state-ment of profit and loss for the period during which such expenses are incurred.

Depreciation on tangible fixed assets is provided on the Straight Line Method (‘SLM’) at the rates and in the manner laid down in Schedule XIV of the Companies Act, 1956 or the rates based on the estimated useful lives of the fixed assets, whichever is higher. Depreciation on tangible fixed assets purchased / installed during the year/ period is calculated on a pro-rata basis from the date of such purchase / installation.

Rates (SLM)

Permanent buildings 1.33%

Temporary buildings 33.33%

Computers 16.21%

Earth moving machinery 11.31%

Electrical equipments 4.75%

Furniture and fixtures 6.33%

Motor vehicles 9.50%

Office equipments 4.75%

Plant and machinery 4.75%

Gains or losses arising from derecognition of tangible fixed assets are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of profit and loss when the asset is derecognised.

e. intangible assets and intangible assets under development

Intangible assets are stated at cost of construction less accumulated amortised amount and accumulated impairment losses, if any. Costs include direct costs of construction of the project and costs incidental and related to the construction activity. Costs incidental to the con-struction activity, including financing costs on borrowings attributable to construction of the project road, have been capitalised to the project road till the date of completion of construction. Such assets include self constructed assets under the BOT (Annuity) scheme, concession rights in respect of tollable roads, etc.

Intangible assets comprising project road, project port and project bridge are amortised on a straight line basis, from the date they are put to use, over the balance period of the Contract. The amortisation period and the amortisation method are reviewed at each financial year end. Concession rights are amortised on the pro-rata basis of actual tollable traffic volume for the period over the total projected tollable traffic volume over the toll periods granted for the project. The projections for the total traffic volume are based on the report of independent pro-fessionals for this purpose. The volume of the traffic is reviewed on periodic intervals for its consistency and appropriateness. If the right to collect toll being amortised is revised on account of the material change in the projected traffic volume arising out of the periodic review, the amortisation would be revised accordingly.

Intangible assets also comprise of rights of Operations and Maintenance (‘O&M’) and an amount paid to Mumbai Port Trust towards upfront fees for construction and operation of an offshore terminal (License Fees Intangible). The O&M intangible results in income stream for the Group for a period of 14 years. The rights are therefore amortised over the period of 14 years. The license fees intangible asset being rights of O&M are amortised over the period of the subsistence of its rights commencing from the date the project becomes operational.

Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of profit and loss when the asset is derecognised.

Intangible asset under development is stated at cost of development less accumulated impairment losses, if any. Costs include direct costs of development of the project road and costs incidental and related to the development activity. Costs incidental to the development activity, including financing costs on borrowings attributable to development of the project road, are capitalised to the project road till the date of completion of development.

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

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f. impairment

The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Group estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or cash-generating unit’s (CGU) net selling price and its value in use. The recoverable amount is determined for an indi-vidual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. Where the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that re-flects current market assessments of the time value of money and the risks specific to the asset. In determining net selling price, recent market transactions are taken into account, if available. If no such transactions can be identified, an appropriate valuation model is used.

The Group comprises of companies which are each engaged in developing a project facility. On creating these facilities the said companies establish a right to charge the users of the project development facility. The project development costs are recovered by these companies from the users of the project facilities through toll or are compensated by the grantor through annuities. For testing the impairment of the project facility developed, these companies conduct impairment tests based on detailed discounted cash flows annually. The period of the cash flow are from the date, the project was awarded to the date, the project has to be handed over to the grantor.

Impairment losses of continuing operations, including impairment on inventories, are recognised in the statement of profit and loss, except for previously revalued tangible fixed assets, where the revaluation was taken to revaluation reserve. In this case, the impairment is also recognised in the revaluation reserve up to the amount of any previous revaluation.

After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life.

g. investments

Investments that are readily realisable and intended to be held for not more than a year are classified as current investments. All other invest-ments are classified as long-term investments.

On initial recognition, all investments are measured at cost. The cost comprises purchase price and directly attributable acquisition charges such as brokerage, fees and duties.

Current investments are carried in the financial statements at lower of cost and fair value determined on an individual investment basis. Long-term investments are carried at cost. However, provision for diminution in value is made to recognise a decline other than temporary in the value of long term investments.

On disposal of an investment, the difference between the carrying amount and the net disposal proceeds is charged to the statement of profit and loss.

h. inventories

Stores and consumables are valued at lower of cost and net realisable value using the weighted average method. Net realisable value is the estimated selling price less estimated cost necessary to make the sale.

i. Borrowing costs

Borrowing cost includes interest, amortisation of ancillary costs incurred in connection with the arrangement of borrowings and exchange differences arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest cost.

Borrowing costs that are directly attributable to the acquisition, construction or production of an asset that takes a substantial period of time to get ready for its intended use are capitalised. Other borrowing costs are recognised as expenditure in the period in which they are incurred.

j. Provision for taxes

Tax expense comprises current and deferred tax. Current income-tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income-tax Act, 1961 enacted in India and tax laws prevailing in the respective tax jurisdictions where the Group oper-ates. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current income tax relating to items recognised directly in equity is recognised in equity and not in the statement of profit and loss.

Deferred income taxes reflects the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively en-acted at the balance sheet date. Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set-off current tax assets against current tax liabilities and the deferred tax assets and the deferred tax liabilities related to the taxes on income levied by same governing taxation laws and to the same taxable entity. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. In situations where the Group has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognised only if there is virtual certainty supported by convincing evidence that they can be realised against future taxable profits.

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 95

In the situations where any company within the Group is entitled to a tax holiday under the Income-tax Act, 1961 enacted in India or tax laws prevailing in the respective tax jurisdictions where it operates, no deferred tax (asset or liability) is recognised in respect of timing differences which reverse during the tax holiday period, to the extent the said company’s gross total income is subject to the deduction during the tax holiday period. Deferred tax in respect of timing differences which reverse after the tax holiday period is recognised in the year in which the timing differences originate. However, the said company restricts recognition of deferred tax assets to the extent that it has become reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available against which such deferred tax assets can be realised. For recognition of deferred taxes, the timing differences which originate first are considered to reverse first.

Minimum alternate tax (MAT) paid in a year is charged to the statement of profit and loss as current tax. The Group recognises MAT credit available as an asset only to the extent that there is convincing evidence that the Group will pay normal income tax during the specified period, i.e., the period for which MAT credit is allowed to be carried forward. In the year in which the Group recognises MAT credit as an asset in accordance with the Guidance Note on Accounting for Credit Available in respect of Minimum Alternative Tax under the Income-tax Act, 1961, the said asset is created by way of credit to the statement of profit and loss and shown as “MAT Credit Entitlement.” The Group reviews the “MAT credit entitlement” asset at each reporting date and writes down the asset to the extent the Group does not have convincing evidence that it will pay normal tax during the specified period.

k. Foreign currency translation

initial recognition :

Foreign currency transactions are recorded in the reporting currency by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction.

Conversion : Foreign currency monetary items are reported using the closing rate. Non-monetary items which are carried in terms of historical cost denominated

in a foreign currency are reported using the exchange rate at the date of the transaction; non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined.

exchange differences : Exchange differences arising on the settlement of monetary items or on reporting the Group’s monetary items at rates different from those at

which they were initially recorded during the year, or reported in previous financial statements, are recognised as income or as expenses in the year in which they arise except those arising from investments in non-integral operations.

l. Preliminary and share issue expenses

Preliminary and share issue expenses (net of taxes) incurred are charged to the security premium account, if available, or to the statement of profit and loss.

m. operating lease

Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased term are classified as operating leases. Operating lease payments are recognised as an expense in the statement of profit and loss on a straight line basis over the lease term.

n. earnings per share

Basic and diluted earnings per share are calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. Partly paid shares are treated as a fraction of an equity share to the extent that they are entitled to participate in dividends relative to a fully paid equity share during the reporting period. The weighted number of equity shares are adjusted for events such as bonus issue, bonus element in the rights issue, share split and reverse share split (consolidation of shares) that have changed the number of equity shares outstanding, without corresponding change in resources.

For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

o. Employee benefits

Retirement benefits in the form of Provident Fund is a defined contribution scheme. The contributions are charged to the statement of profit and loss for the year when the contributions are due. The Group has no obligation, other than the contribution payable to the provident fund.

The Group operates only one defined benefit plan for its employees i.e. gratuity liability. The costs of providing this benefit are determined on the basis of actuarial valuation at the each year end. Actuarial valuation is carried out using the projected unit credit method. Actuarial gains and losses of the defined benefit plan are recognised in full in the period in which they occur in the statement of profit and loss.

Accumulated leave, which is expected to be utilised within the next twelve months, is treated as short-term employee benefit. The Group measures the expected cost of such absences as the additional amount that it expects to pay as a result of the unused entitlement that has accumulated at the reporting date.

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 96

The Group treats accumulated leave expected to be carried forward beyond twelve months, as long-term employee benefit for measurement purposes. Such long term compensated absences are provided for based on the actuarial valuation using the projected unit credit method at the year end. Actuarial gains and losses of the defined benefit plan are recognised in full in the period in which they occur in the statement of profit and loss and are not deferred.

p. employee share based payments (‘esoP’)

The Group uses the intrinsic value (excess of the share price on the date of grant over the exercise price) method of accounting prescribed by the Guidance Note (‘GN’) on ‘Accounting for employee share-based payments’ issued by the Institute of Chartered Accountants of India (‘ICAI’) (‘the guidance note’) to account for its Employee Stock Option Scheme (the ‘ESOP’ Scheme) read with SEBI (Employees stock option scheme or Employees Stock Purchase) Guidelines,1999. Compensation expense is amortised over the vesting period of the option on SLM basis.

q. Grants received

The Group on receipt of grant, received as equity support from grantors, accounts the same under Shareholders Funds under Reserves and Surplus, in accordance with the terms of the concession granted to the Group.

The grant related to operations not forming part of equity support is credited to the statement of the Profit and Loss on a pro-rata basis in the year when the same is due and receivable and when the related costs are incurred.

r. deferred payment liability

The deferred payment liability represents the cash payout (Negative grant) payable to the grantor as per the terms of the Contract at the end of the concession period. The said deferred payment liability does not carry any interest thereon.

s. Minority interest

Minority interest comprises of amount of equity attributable to the minority shareholders at the date on which investments are made by the Group and further movements in their share in the equity, subsequent to the date of the investments.

t. segment reporting

Identification of segments :

Business segments have been identified on the basis of the nature of services, the risk return profile of individual business, the organisational structure and the internal reporting system of the Group.

u. Provisions

A provision is recognised when the Group has a present obligation as a result of past event; it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made of the amount of obligation. Provisions are not discounted to its present value and are determined based on best estimate required to settle the obligation at the reporting date. These are reviewed at each reporting date and adjusted to reflect the current best estimates.

v. Cash and bank balances

Cash and bank balances comprise of cash at bank and in hand and short-term investments with an original maturity of three months or less.

w. Contingent liability

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain events beyond the control of the Group or a present obligation that is not recognised because it is not probable that an outflow of resources will be required to settle an obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognised because it cannot be measured reliably. The Group does not recognise a contingent liability but discloses its existence in the financial statements.

x. Measurement of eBitda

As permitted by the Guidance Note on the Revised Schedule VI to the Companies Act, 1956, the Group has elected to present Earnings Before Interest, Tax and Depreciation / Amortisation (EBITDA) as a separate line item on the face of the statement of profit and loss. The Group measures EBITDA on the basis of profit/(loss) from continuing operations. In the measurement, the Group does not include depreciation and amortisation expense, finance costs and tax expense.

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 97

3 The consolidated financial statements comprise the financial statements of GAMMON INFRASTRUCTURE PROJECTS LIMITED (‘GIPL’) (the hold-ing company), its subsidiary companies, joint ventures and associates consolidated on the basis of the relevant accounting standards as dis-cussed in note 2b.

a. subsidiaries:

The following subsidiary companies (incorporated in India) have been consolidated in these financial statement as per AS-21 as on March 31, 2012.

Particulars

Voting powerand beneficialinterest as at

March 31, 2012

Voting powerand beneficialinterest as at

March 31, 2011

Andhra Expressway Limited (‘AEL’) 100.00% 100.00% Aparna Infraenergy India Private Limited (‘AIIPL’) [refer note 3(a)(iii)] 100.00% - Cochin Bridge Infrastructure Company Limited (‘CBICL’) 97.66% 97.66% Chitoor Infrastructure Company Private Limited (‘CICPL’) 100.00% 100.00% Dohan Renewable Energy Private Limited (‘DREPL’) 100.00% 100.00% Earthlink Infrastructure Projects Private Limited (‘EIPPL’) 100.00% 100.00% Gammon Logistics Limited (‘GLL’) 100.00% 100.00% Gammon Projects Developers Limited (GPDL’) 100.00% 100.00% Gammon Renewable Energy Infrastructure Limited (‘GREIL’) 100.00% 100.00% Gammon Road Infrastructure Limited (‘GRIL’) 100.00% 100.00% Gammon Seaport Infrastructure Limited (‘GSIL’) 100.00% 100.00% Ghaggar Renewable Energy Private Limited (‘GREPL’) 100.00% 100.00% Gorakhpur Infrastructure Company Limited (‘GICL’) 96.53% 96.53% Haryana Biomass Power Limited (‘HBPL’) 100.00% - Indori Renewable Energy Private Limited (‘IREPL’) 100.00% 100.00% Jaguar Projects Developers Limited (‘JPDL’) 100.00% 100.00% Kasavati Renewable Energy Private Limited (‘KREPL’) 100.00% 100.00% Kosi Bridge Infrastructure Company Limited (‘KBICL’) 100.00% 100.00% Lilac Infraprojects Developers Limited (‘LIDL’) 100.00% 100.00% Markanda Renewable Energy Private Limited (‘MREPL’) 100.00% 100.00% Marine Project Services Limited (‘MPSL’) 100.00% 100.00% Mumbai Nasik Expressway Limited (‘MNEL’) 79.99% 79.99% Patna Buxar Highways Limited (‘PBHL’) 100.00% - Pataliputra Highways Limited (‘PHL’) 100.00% 100.00% Patna Highway Projects Limited (‘PHPL’) 100.00% 100.00% Pravara Renewable Energy Limited (‘PREL’) 100.00% 100.00% Ras Cities and Townships Private Limited (‘RCTPL’) 100.00% 100.00% Rajahmundry Expressway Limited (‘REL’) 100.00% 100.00% Rajahmundry Godavari Bridge Limited (‘RGBL’) 51.00% 51.00% Satluj Renewable Energy Private Limited (‘SREPL’) 100.00% 100.00% Sikkim Hydro Power Ventures Limited (‘SHPVL’) 100.00% 100.00% Segue Infrastructure Projects Private Limited (‘SIPPL’) 100.00% 100.00% Sirsa Renewable Energy Private Limited (‘Sirsa REPL’) 100.00% 100.00% Tada Infrastructure Development Company Limited (‘TIDCL’) 100.00% 100.00% Tangri Renewable Energy Private Limited (‘TREPL’) 100.00% 100.00% Tidong Hydro Power Limited (‘THPL’) 51.00% 51.00% Vijaywada Gundugolanu Road Project Private Limited (‘VGRPPL’) 100.00% - Vizag Seaport Private Limited (‘VSPL’) 73.76% 73.76% Yamuna Renewable Energy Private Limited (‘YREPL’) 100.00% 100.00% Youngthang Power Ventures Limited (‘YPVL’) 100.00% 100.00%

As part of its overall business plans, the Group has been acquiring beneficial interest and voting rights. This along with the Group’s legal shareholdings has resulted in the Group having control over 51% in various SPVs as listed above. The details of the amounts paid and resultant beneficial interest and voting rights are tabulated hereunder :

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 98

As at March 31, 2012 As at March 31, 2011

Particulars Equity shares Value Holding Equity shares Value Holding

Nos. Rupees % Nos. Rupees %

AEL 7,540,050 126,651,866 26.00% 7,540,050 126,651,866 26.00% CICPL 10,000 100,000 100.00% 10,000 100,000 100.00% EIPPL 10,000 100,000 100.00% 10,000 100,000 100.00% GICL 14,947,238 149,472,380 27.53% 14,947,238 149,472,380 27.53% KBICL 12,562,831 125,628,310 26.01% 12,562,831 125,628,310 26.01% REL 7,540,050 119,575,780 26.00% 7,540,050 119,575,780 26.00% SIPPL 10,000 100,000 100.00% 10,000 100,000 100.00% THPL 25,500 255,000 51.00% 25,500 255,000 51.00%

i) During the current year, the names of the two subsidiaries Tada Sez Private Limited and Satyavedu Infra Company Private Limited were changed to Tada Infrastructure Projects Private Limited and Chitoor Infrastructure Projects Private Limited. Subsequently, the said changed names of the two companies were rechanged to Segue Infrastructure Projects Private Limited and Earthlink Infrastructure Projects Private Limited. Further, during the year two new subsidiaries Patna Buxar Highways Limited (‘PBHL’) and Vijaywada Gundugolanu Road Project Private Limited (‘VGRPPL’) were incorporated as a subsidiary of the Group.

ii) During the current year, MNEL in addition to the provisional certificates received in the year 2010-11 for 64 Kms, received provisional completion certificate for a further chainage of 30.77 Kms for the purposes of tolling vide certificate dated May 31, 2011. Pursuant to this 96.64 Kms stretch of road was opened for toll collection on August 29, 2011 after adherence to the requirements of the concession agreement and the cost attributable to it was capitalised as ‘Toll Concession Rights’ on that date. MNEL has commenced operations of Phase 2 of the toll road project from Vadape to Gonde in the state of Maharashtra, from August 29, 2011. However, as the two Road Over Bridges (ROB), totaling 1.87 Km length, were incomplete MNEL was allowed to toll the users of the road for only 94.77 Kms. On completion of the said ROBs on December 28, 2011, MNEL was allowed to levy toll for the entire length of 96.64 Kms as per letter dated January 18, 2012.

iii) During the current year, Aparna Infraenergy India, a partnership firm, in which a subsidiary of the Group was a majority partner, was converted into a Company, under Part IX of the Companies Act, 1956 and consequently became a subsidiary of the Group.

iv) The Group divested its entire stake in Punjab Biomass Power Limited, in favour of its joint venture partner. At the same time it acquired from the same joint venture partner, their entire stake in HBPL (comprising six biomass projects in the state of Haryana and one in the state of Punjab). Hence, PBPL ceased to be a Group company and HBPL became a subsidiary of the Group. Subsequent to the acquisition all the biomass projects awarded to HBPL were withdrawn by the client, and ̀ 13,158,572 (Previous year : ` Nil) incurred on the projects of HBPL, capitalised earlier, have now been charged to the statement profit and loss.

v) Effect of acquisition of subsidiaries during the year on financial statements.

DetailsAs at As at

March 31, 2012 March 31, 2011

Subsidiary HBPL -liaBilitiesCurrent liabilitiesDues against expenses to related parties 5,233,651 - Other liabilities 4,137 - assetsnon-current assetsIntangible asset under development 3,914,215 - Long-term loans and advances 1,440,000 - Current assets - -Cash and cash equivalents 98,704 - inCoMeExpenditure - - Other expenses 828 - Profit /(loss) before tax (828) - Current tax - - Profit /(loss) after tax (828) -

In respect of the above acquisition, the total purchase consideration was ` 14,350,000 fully paid.

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 99

b. Joint venture entities :

The following jointly controlled entities have been considered applying AS-27 on the basis of audited accounts (except stated other wise) for the year ended March 31, 2012.

i) details of joint ventures entered into by the Group :

Particulars% of Interest

as atMarch 31, 2012

% of Interestas at

March 31, 2011

Joint VentuRe CoMPanies Blue Water Iron Ore Terminal Private Limited ('BWIOTPL') 31.00% 37.30% Haryana Biomass Power Limited ('HBPL') - 50.00% Indira Container Terminal Private Limited ('ICTPL') 50.00% 50.00% Punjab Biomass Power Limited ('PBPL') - 50.00% SEZ Adityapur Limited ('SEZAL') 38.00% 38.00%

ii) The proportionate share of assets, liabilities, income and expenditure of the Joint Ventures consolidated in the accounts is tabulated hereunder.

ParticularsAs at As at

March 31, 2012 March 31, 2011

assets non-current assetsFixed assets :Tangible assets (net) 43,197,045 384,091,108 Intangible assets (net) 125,000,000 125,000,000 Capital work in progress 44,588,156 - Intangible assets under development 1,673,191,783 920,600,604 Long-term loans and advances 75,443,507 160,805,236 Current assetsInventories 597,957 25,496,861 Trade receivables 753,427 1,026,689 Cash and bank equivalents 10,383,854 11,134,907 Short-term loans and advances 17,265,005 26,540,074 total assets 1,990,420,734 1,654,695,479 liaBilities non-current liabilitiesLong-term borrowings 1,487,979,019 876,169,441 Long-term provisions 780,786 145,014 Current liabilitiesShort-term borrowings - 10,020,927 Trade payables, current 816,925 4,572,034 Other current liabilities 147,844,844 145,909,809 Short-term provisions 221,684 1,706,965 total liabilities 1,637,643,258 1,038,524,190 ReseRVes and suRPlusSecurities premium - 15,000,000 Deficit in the statement of profit and loss :Opening balance (131,224,080) (71,563,125)During the current year (139,317,773) (61,291,536)Total Reserves and surplus (270,541,853) (117,854,661)total reserves, surplus and liabilities 1,367,101,405 920,669,529 inCoMeRevenue from projects 28,923,096 41,718,694 Other income 1,602,724 316,889 total income 30,525,820 42,035,583

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 100

ParticularsAs at As at

March 31, 2012 March 31, 2011

exPenses Project expenses 69,198,515 50,765,193 Employee benefit expenses 13,379,930 15,248,265 Other expenses 6,257,437 10,111,667 Exceptional items - - Finance cost 70,221,007 11,597,180 Depreciation and amortisation 10,592,881 15,604,814 total expenses 169,649,770 103,327,119 Profit before tax (139,123,950) (61,291,536)Provision for tax 193,823 - Profit after tax (139,317,773) (61,291,536)

Capital commitments 714,741,238 1,121,418,804

The above figures pertaining to the joint venture companies are based on the audited accounts of ICTPL and un-audited management accounts of BWIOTPL and SEZAL for the year ended March 31, 2012. All the joint venture companies were incorporated in India.

c. associates : The following associates have been accounted for on one line basis applying the equity method in accordance with the Accounting Standard

(AS) – 23 “ Accounting for Investment in Associates in Consolidated Financial Statements”.

Particulars% of Interest

as atMarch 31, 2012

% of Interestas at

March 31, 2011

ATSL Infrastructure Projects Limited ('AIPL') 30.90% 30.90% Eversun Sparkle Maritime Services Private Limited ('ESMSPL') 48.94% 48.94% Modern Tollroads Limited ('MTL') 48.90% 48.90%

The above figures pertaining to the Associate Companies are based on the un-audited management accounts for the year ended March 31, 2012.

4 sHaRe CaPital

ParticularsAs at As at

March 31, 2012 March 31, 2011

authorised equity share capital :1,000,000,000 (Previous year : 1,000,000,000) equity shares of ` 2 each 2,000,000,000 2,000,000,000 total authorised equity share capital 2,000,000,000 2,000,000,000

issued and subscribed equity share capital :729,573,868 (Previous year : 729,550,412) equity shares of ` 2 each 1,459,147,736 1,459,100,824 total issued and subscribed equity share capital 1,459,147,736 1,459,100,824

Paid-up equity shares : 728,763,618 (Previous year : 728,740,162) equity shares of ` 2 each fully paid-up 1,457,527,236 1,457,480,324 total paid-up equity shares 1,457,527,236 1,457,480,324

Forfeiture of equity shares :Money received in respect of 162,050 (Previous year :162,050) equity shares forfeited of ` 10 each 8,102,500 8,102,500 total money received of forfeited equity shares 8,102,500 8,102,500 total net paid-up equity share capital 1,465,629,736 1,465,582,824

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 101

a. Reconciliation of the number of shares outstanding at the beginning and at the end of the year

Particulars As at March 31, 2012 As at March 31, 2011

Numbers Rupees Numbers Rupees

Equity shares of ` 2 each fully paid-up Outstanding at the beginning of the year 728,740,162 1,457,480,324 724,439,750 1,448,879,500 Issued during the year on exercise of Employee Stock Options ('ESOP') 23,456 46,912 4,300,412 8,600,824

Outstanding at the end of the year 728,763,618 1,457,527,236 728,740,162 1,457,480,324

b. Shares held by the holding company and /or their subsidiaries / associates

Out of the equity shares issued, shares held by the holding company and /or their subsidiaries / associates is summarised under :

Registered shareholders As at March 31, 2012 As at March 31, 2011

Numbers Rupees Numbers Rupees

Equity shares of ` 2 each fully paid-up Gammon India Limited ('GIL') 528,000,000 1,056,000,000 528,000,000 1,056,000,000 Gactel Turnkey Projects Limited ('GTPL'), subsidiary of the holding company 22,400,000 44,800,000 22,400,000 44,800,000

total 550,400,000 1,100,800,000 550,400,000 1,100,800,000

c. details of registered shareholders holding more than 5% shares

Registered shareholders holding more than 5% shares As at March 31, 2012 As at March 31, 2011

Numbers % of holding Numbers % of holding

Equity shares of ` 2 each fully paid-up GIL 528,000,000 72.45% 528,000,000 72.45%total 528,000,000 72.45% 528,000,000 72.45%

As per the records of the Company, including its register of shareholders/members and other declarations received from shareholders, the above shareholding represents legal ownership of the shares.

d. Terms / rights attached to equity shares the Company has only one class of shares referred to as equity shares having a par value of ` 2 per share. Each holder of equity shares is entitled to one vote per share.

In the event of liquidation of the Company, the equity share holders will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

e. shares reserved under options to be given 3,395,420 (Previous year : 4,834,590) equity shares of ` 2 each of the Company has been reserved for issue as ESOPs [note 5(c)].

5 ReseRVes and suRPlus

ParticularsAs at As at

March 31, 2012 March 31, 2011

CaPital ReseRVe :Capital grant :Balance, beginning of the year 496,660,000 332,380,000 Add : Capital grant received during the year 876,990,000 164,280,000 Balance, end of the year (A) 1,373,650,000 496,660,000

seCuRities PReMiuM aCCount :Balance, beginning of the year 3,523,177,883 3,440,969,045 Add : On issue of shares on exercise of employee stock options 1,265,241 82,247,838 Less : Security premium on divestment of joint venture company 15,000,000 - Less : Share issue expenses during the year - 39,000 Balance, end of the year (B) 3,509,443,124 3,523,177,883

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 102

ParticularsAs at As at

March 31, 2012 March 31, 2011

eMPloyee stoCK oPtions :Employee stock options outstanding 9,676,544 50,221,500 Less : Employee stock options exercised 176,790 29,968,800 Less : Forfeiture of employee stock options offered 753,005 10,576,156

8,746,749 9,676,544 Add : Short accounting of ESOPs' in prior years 273,000 - Less : Transfer to general reserve 2,395,500 - Less : Deferred employee compensation outstanding 46,247 468,610 Balance, end of the year (C) 6,578,002 9,207,934

otHeR ReseRVes :

General Reserve :Balance, beginning of the year 220,300,000 18,200,000 Add: Amounts transferred from surplus balance in the statement of profit and loss 90,552,576 202,100,000 Add: Amounts transferred from employee stock options 2,395,500 - Balance, end of the year (D) 313,248,076 220,300,000

Surplus / (deficit) in the statement of profit and lossBalance, beginning of the year 1,198,982,083 1,287,194,361 Add : Profit /(Loss) for the year (254,181,145) 171,686,172 Less : Appropriations Tax on equity dividend 72,920,140 57,798,450 Transfers to general reserve 90,552,576 202,100,000 Balance, end of the year (E) 781,328,222 1,198,982,083

total ReseRVes and suRPlus (A+B+C+D+E) 5,984,247,424 5,448,327,900

a. Capital grant : Capital grant includes grant received by two SPVs of the Group, from NHAI and the Government of Andhra Pradesh in the nature of equity

support of the grantor.

b. General reserve : General reserve is created in accordance with the requirements of the Companies (Transfer of Profits to Reserves) Rules, 1975.

c. employees stock options (‘esoP’) : The Company has instituted an ESOP Scheme “GIPL ESOP 2007” scheme during the FY 2007-08 approved by its shareholders vide their

resolution dated May 4, 2007, as per which the Board of Directors of the Company, granted 1,640,000 equity-settled stock options to its employees pursuant to the ESOP Scheme on July 1, 2007 and October 1, 2007. Each options entitles an employee to subscribe to 1 equity share of ` 10 each (post sub-division of equity shares subscribed to five equity shares of ` 2 each) of the Company at an exercise price of ` 80 per share. During the year 2008-09, the Compensation Committee of the Board of the Directors of the Company at its meeting held on October 1, 2008, further granted 920,000 equity-settled options to eligible employees of the Company at the market price of ` 63.95 per equity share of ` 10 each, prevailing on September 30, 2008 upon expiry of the respective vesting period which ranges from one to three years. During the current year, Nil (Previous year : 689,750) options were exercised while 229,500 (Previous year : 150,000) options were forfeited / lapsed. Out of the options granted, 485,750 (Previous year : 715,250) are outstanding at the end of the year.

During the FY 2008-09, the Compensation Committee of the Board of the Directors of the Company at its meeting held on October 1, 2008, instituted a new ESOP Scheme “GIPL ESOP 2008” scheme as per which the Company has further granted 490,000 equity-settled options to its eligible employees of the Company at the market price of ` 63.95 per equity share of ` 10 each, (post sub-division of equity shares subscribed to five equity shares of ` 2 each) prevailing on September 30, 2008 upon expiry of the respective vesting period which ranges from one to three years. During the current year, Nil (Previous year : 153,332) options were exercised while 33,334 (Previous year : 25,000) options were forfeited / lapsed. Out of the options granted, 93,334 (Previous year : 126,668) are outstanding at the end of the year.

Further, during the FY 2009-10, the Compensation Committee of the Board of the Directors of the Company, at its meeting held on May 8, 2009 further granted 210,000 equity-settled options to eligible employees of the Company, at the market price of ` 72.10 per equity share of ` 10 each (post sub-division of equity shares subscribed to five equity shares of ̀ 2 each), prevailing on that date upon expiry of the vesting period of three years. During the current year, 20,308 (Previous year : 68,000) options were forfeited / lapsed while 4,692 (Previous year : 17,000) options were exercised by the employees. Out of the options granted, 100,000 (Previous year : 125,000) are outstanding at the end of the year.

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 103

The details of the grants under the aforesaid ESOPs Schemes are summarised hereunder :

esoP scheme 2007

Particulars 2011-2012 2010-2011

Date on which options were granted July 1, 2007 Oct. 1, 2007 Oct. 1, 2008 July 1, 2007 Oct. 1, 2007 Oct. 1, 2008Vesting from July 1, 2008 Oct. 1, 2008 Oct. 1, 2009 July 1, 2008 Oct. 1, 2008 Oct. 1, 2009

Fair value of shares as on grant date (`) 99.00 124.00 63.95 99.00 124.00 63.95

Market value of shares as on grant date (`) N.A. N.A. 63.95 N.A. N.A. 63.95 Exercise price of options granted (`) 80.00 80.00 63.95 80.00 80.00 63.95 Outstanding options at the beginning of the year (Nos) 420,250 25,000 270,000 1,260,000 25,000 270,000

Options granted during the year (Nos) - - - - - - Options lapsed during the year (Nos) 114,500 5,000 90,000 - - - Options forfeited during the year (Nos) - 20,000 - 150,000 - - Options exercised during the year (Nos) - - - 689,750 - - Outstanding granted options at the end of the year (Nos) 305,750 - 180,000 420,250 25,000 270,000

esoP scheme 2008

Particulars 2011-2012 2010-2011

Date on which options were granted Oct. 1, 2008 May 8, 2009 Oct. 1, 2008 May 8, 2009Vesting from Oct. 1, 2009 Oct. 1, 2010 Oct. 1, 2009 Oct. 1, 2010

Market value of shares as on grant date (`) 63.95 72.10 63.95 72.10 Exercise price of options granted (`) 63.95 63.95 63.95 63.95 Outstanding options at the beginning of the year (Nos) 126,668 125,000 305,000 210,000

Options granted during the year (Nos) - - - - Options lapsed during the year (Nos) 16,667 - - - Options forfeited during the year (Nos) 16,667 20,308 25,000 68,000 Options exercised during the year (Nos) - 4,692 153,332 17,000 Outstanding granted options at the end of the year (Nos) 93,334 100,000 126,668 125,000

other disclosures

Particulars ESOP Scheme2007

ESOP Scheme2008

ESOP Scheme2008

Options (Numbers) 270,000 490,000 210,000 Weighted average fair value of options granted 40.46 40.46 36.12

Option pricing model usedBlack Scholes Option Pricing

Model

Black Scholes Option Pricing

Model

Black Scholes Option Pricing

ModelEquity share price 74.30 74.30 70.85 Exercise price 63.95 63.95 63.95 Expected volatility 0.5169 0.5169 0.7508 Weighted average on unexpired life of the options (in years) 2.51 2.51 0.76 Expected dividend Nil Nil Nil Risk free interest rate 8.61% 8.61% 5.03%

Basis of determination of volatility

Average of GIPL(from the date of listing)

and 4 previous yrs average of IVRCL

and Nagarjuna

Average of GIPL(from the date of listing)

and 4 previous yrs average of IVRCL

and Nagarjuna

Average of GIPL(from the date of listing)

and 4 previous yrs average of IVRCL

and Nagarjuna

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 104

6 MinoRity inteRest

ParticularsAs at As at

March 31, 2012 March 31, 2011

Balance, beginning of the year 836,765,506 282,863,413 Add :Minority interest in equity : Increase in minority's share in equity capital of subsidiaries in the current year 349,273,560 515,526,440 Short accounting of minority interest in previous years - 719,690

349,273,560 516,246,130 Add : Minority interest in profits/(losses) of subsidiaries : Minority interest in profits/(losses) of subsidiaries for the current year 33,733,875 48,452,098

33,733,875 48,452,098 Less : Profit/(Loss) on sale of equity shares of subsidiary companies to minority share holder - 10,796,135

- 10,796,135 Balance, end of the year 1,219,772,941 836,765,506

7 lonG-teRM BoRRoWinGs

Particulars Non-current portion Current maturitiesMarch 31, 2012 March 31, 2011 March 31, 2012 March 31, 2011

i term loans (Secured) [refer below for details of security]Indian rupee loans from banks 20,892,611,616 22,357,880,708 3,033,136,860 1,546,565,746 From financial institutions 7,908,754,412 220,414,706 124,235,293 1,281,435,294 From others 250,000,000 - 800,000,000 -

29,051,366,028 22,578,295,414 3,957,372,153 2,828,001,040 ii 10.3% unsecured intercorporate loan

From a minority shareholder 137,155,000 - - - 137,155,000 - - -

iii deferred payment liability, unsecuredNegative grant payable to NHAI 1,200,000,000 1,200,000,000 - -

1,200,000,000 1,200,000,000 - - The above amount includes :Secured borrowings 29,051,366,028 22,578,295,414 3,957,372,153 2,828,001,040 Unsecured borrowings 1,337,155,000 1,200,000,000 - - Amount disclosed under the head ‘Other Current Liabilities’ (note 12) - - (3,957,372,153) (2,828,001,040)

total 30,388,521,028 23,778,295,414 - -

a. The above term loans from banks and financial institutions are primarily taken by various project executing entities of the Group for the execution of the projects. These loans are secured by :

(i) a first mortgage and charge on all the movable properties, immovable properties, tangible assets, intangible assets and all bank accounts (including escrow bank accounts) save and except the project assets of each individual borrowing company in the Group.

b. Loans from others are secured by first charge on proceeds/ receivables to be received from the National Highways Authority of India (NHAI) towards annuities to be received for the period between the Scheduled Commercial Operation Date and the actual Commercial Operations Date (COD). The loan is repayable in two annual installments commencing from March 1, 2013.

c. On March 30, 2012, one of the SPV of the Group has obtained a new term loan from a financial institution for which charge was yet to be created as at March 31, 2012. No charge has been created as on the date of the balance sheet.

d. Pledge of shares : The equity shares held by the Company and / or GIL in a subsidiary and /or joint venture company of the Group are pledged with respective

lenders or consortium of lenders for the individual secured loan availed by the said subsidiary and / or joint venture company from their respective lenders or consortium of lenders.

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 105

ParticularsFace value of equity shares

Rupees

Number of equity shares pledged

March 31, 2012Nos.

March 31, 2011Nos.

AEL 10 13,171,442 12,919,897 CBICL 10 1,664,019 1,664,019 GICL 10 37,279,629 9,593,233 KBICL 10 20,767,040 12,558,000 MNEL 10 16,120,000 16,120,000 PHL 100 7,350 - PHPL 10 750,000 750,000 REL 10 14,744,579 14,744,579 RGBL 10 89,573,750 54,116,100 VSPL 10 61,515,633 20,589,729 ICTPL* 10 20,000,000 - total 275,593,442 143,055,557

* Unconfirmed by the bank

e. interest rates : The above mentioned long-term loans carry an interest rate which is at a spread above/below the bank’s base rate or bank prime lending rate

or G-sec rate or at a negotiated rate. The spread ranges from 50 to 300 bases points. In case of a consortium of lenders the rate applicable is the highest rate charged by any one member of the consortium thereof.

Loans from others, carries interest rate in the range of 11% to 14% p.a.

f. schedule of repayments of the term loans :

As at As atMarch 31, 2012 March 31, 2011

Installments payable within one year i.e. upto March 31, 2013 3,957,372,153 1,828,001,040 Installments payable between 2 to 5 years 13,057,894,380 8,661,734,402 Installments payable beyond 5 years 16,130,626,648 13,916,561,012 total 33,145,893,181 24,406,296,454

g. unsecured intercorporate loan :i) The intercorporate loan has been availed by a subsidiary of the Group from its minority shareholder.

ii) The loan is due for repayment at the end of 36 months from March 31, 2012.

h. unsecured, deferred payment liability : As per the terms of the concession agreement between MNEL and NHAI, MNEL is required to make a cash payout (‘Negative Grant’) of `

1,200,000,000 in the last year of the concession period (i.e. March, 2026). The same is capitalised as toll concession rights and capital work in progress on a proportionate basis and is represented as deferred payment liability in the financial statements.

8 deFeRRed tax liaBilities (net)

ParticularsAs at As at

March 31, 2012 March 31, 2011

deferred tax liabilityOn account of depreciation/amortisation 31,956,069 34,582,012 deferred tax assetOn account of employee benefits 6,311,275 7,943,305 net deferred tax liability 25,644,794 26,638,707

9 otHeR lonG-teRM liaBilities

ParticularsAs at As at

March 31, 2012 March 31, 2011

Margin money deposit 5,000,000 5,000,000 Performance deposit from vendor 3,850,000 3,850,000 total otHeR lonG-teRM liaBilities 8,850,000 8,850,000

Margin money has been received from the joint venture ICTPL against bank guarantee issued from the holding company’s limits.

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 106

10 PRoVisions

Particulars Long-term Short-termMarch 31, 2012 March 31, 2011 March 31, 2012 March 31, 2011

Provision for employee benefitsProvision for cash compensation scheme - 16,804,235 19,506,127 - Provision for gratuity 5,231,157 3,603,567 457,832 893,556 Provision for leave encashment 11,866,968 7,049,455 2,304,075 1,286,867

17,098,125 27,457,257 22,268,034 2,180,423 other provisionsProvision for taxation - - 106,902,426 48,395,465 Provision for periodic maintenance 282,103,000 - - -

282,103,000 - 106,902,426 48,395,465 total PRoVisions 299,201,125 27,457,257 129,170,460 50,575,888

a. Cash compensation scheme : In earlier years, the Compensation Committee of the Board of Directors has implemented a scheme of Retention Bonus for its employees.

Under this scheme, employees (excluding the Managing Director), to whom stock options were offered in the current year are entitled to a cash alternative to the options which would be payable in lieu of their not exercising the right to apply for the shares against the options granted under the ESOP schemes. During the year, a provision of ` 2,701,892 (Previous year : ` 1,436,424) against cash compensation has been made in accordance with guidance note on accounting of employees share based payments.

b. Gratuity : The revised AS -15 (Employee Benefits) is applicable to the Group.

Under the gratuity plan, every employee who has completed atleast five years of service gets a gratuity on departure @ 15 days of last drawn salary for each completed year of service. The schemes of all the Group companies except for the one joint venture SPV is unfunded.

The following table summarises the components of net benefit expense recognised in the statement of profit and loss and amounts recognised in the balance sheet.

March 31, 2012 March 31, 2011Particulars

Current service cost 1,629,104 1,232,782 Interest cost on benefit obligation 403,606 291,933 Expected return on plan asset (56,635) (50,210)Actuarial (gain)/loss (60,708) 603,024 Past service cost 156,057 153,058 2,071,424 2,230,587 Less : Gratuity capitalised 151,411 95,072 Net benefit expense 1,920,013 2,135,515

The changes in the present value of the defined benefit obligation are as follows :

March 31, 2012 March 31, 2011Particulars

Opening defined benefit obligation 4,497,122 3,149,507 Current service cost 1,629,104 1,394,174 Interest cost on benefit obligation 403,605 291,933 Actuarial (gain)/loss (62,573) 611,681 Past service cost 131,564 376,295 Less : Benefit paid 64,856 1,326,468 Closing defined benefit obligation 6,533,966 4,497,122

The gratuity scheme of a joint venture SPV is funded with an insurance company in the form of a qualifying insurance policy. The details of fair value of the plan assets is as follows :

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 107

March 31, 2012 March 31, 2011Particulars

Fair value of plan assets at the beginning of the year - - Expected return on plan assets 56,635 - Contributions 103,571 - Actuarial gain/(loss) on plan assets (1,716) - Prior year value of plan assets 686,487 - Fair value of plan assets at the end of the year 844,977 -

The actual return on plan assets of the SPVs is presently not available.

ParticularsYear ended Year ended Year ended Year ended Year ended

March 31, 2012 March 31, 2011 March 31, 2010 March 31, 2009 March 31, 2008

Actuarial (gain)/loss 264,881 1,076,164 (134,208) (60,054) 867,322 Experience adjustment 392,746 745,251 (209,553) 277,528 1,023,255 Changes in actuarial assumptions (127,865) 328,929 (78,767) (337,582) (155,933)

The principal assumptions used in determining the gratuity obligations are as follows:

March 31, 2012 March 31, 2011Particulars

Discount rate 8.75% 8.25%Expected rate of return on planned assets Not applicable Not applicableAttrition rate 2% 2%Retirement age 60 years 60 years

The estimates of future salary increases, considered in actuarial valuation take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

c. Periodic maintenance :

Hitherto, periodic maintenance cost including resurfacing expenditure required to be undertaken by the operator under its BOT contracts at specified intervals were capitalised to the project asset. From the current year, in line with industry practice, the relevant SPVs have recognised a provision for such expenditure on a systematic basis over the period for which such obligations are to be carried out. During the current year ` 282,103,000 (Previous year : ` Nil) has been provided towards periodic maintenance activity.

The movement of provisions during the year as required by Accounting Standard 29 “Provisions, Contingent Liabilities and Contingent Assets” notified under the Companies (Accounting Standards) Rules, 2006, (as amended) is as under:

Particulars Opening Reversed Utilised Additions Closing balance during the year during the year during the year balance

Cash compensation scheme 16,804,235 835,361 - 3,537,253 19,506,127 (17,038,466) (11,670,655) (-) (11,436,424) (16,804,235)

Periodic maintenance - - - 282,103,000 282,103,000 (-) (-) (-) (-) (-)

(Previous year’s figures in brackets)

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 108

11 sHoRt-teRM BoRRoWinGs

ParticularsAs at As at

March 31, 2012 March 31, 2011

Cash credit from banks (secured) - 7,958,427 Loans from Banks / Financial Institutions :Unsecured loans :Short-term loans from banks 1,200,000,000 200,000,000 intercorporate loans received (repayable on demand, unsecured) :From related parties :12% Inter-corporate deposit from GIL, the holding company 736,200,000 736,200,000 From others - 2,062,500 total short-term borrowings 1,936,200,000 946,220,927 The above amount includes Secured borrowings - 7,958,427 Unsecured borrowings 1,936,200,000 938,262,500

a. Cash credit from banks was availed by the Group’s joint venture company in which stake was divested during the year.

b. Intercorporate loans received from others as on March 31, 2012, include amounts received by PBPL ` Nil (Previous year : ` 2,062,500) from the joint venture partner.

12 otHeR CuRRent liaBilities

ParticularsAs at As at

March 31, 2012 March 31, 2011

trade payables (for details of dues to micro and small enterprises) 112,339,462 117,353,740

112,339,462 117,353,740 other liabilities Current maturities of long-term borrowings (note 7) 3,957,372,153 2,828,001,040 Interest accrued

Related parties 80,217,739 36,943,589 Others 66,712,098 26,870,404

Advances received from clients 33,712,180 71,170,028 Dues against capital expenditure

Related parties 1,162,016,701 661,282,105 Others 31,606,140 28,847,912

Dues to joint venture partners 62,986,015 56,776,133 Dues against expenses to related parties 194,922,619 178,363,176 Amount due to minority shareholders 170,001,000 540,031,000 Duties and taxes payable 106,518,381 95,649,833 Book overdraft 154,390,627 - Others 219,557,062 109,372,194

6,240,012,715 4,633,307,414 total otHeR CuRRent liaBilities 6,352,352,177 4,750,661,154

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 109

a. Amounts due to micro and small enterprises as defined under the MSMED Act, 2006 : As per the information available with the Group, there are no Micro, Small, and Medium Enterprises, as defined in the Micro, Small, and Medium Enterprises Development Act, 2006, to whom the Group owes dues on account of principal or interest.

The above information regarding Micro, Small, and Medium Enterprises has been determined to the extent such parties have been identified on the basis of information available with the Group. This has been relied upon by the auditors.

b. Dues against capital expenditure includes amount of ` 1,162,016,701 (Previous year : ` 661,282,105) due to GIL against the project construction works from Group companies.

c. Dues to joint venture partners includes share application money received from joint venture partners of BWIOTPL ` 62,986,015 (Previous year : ` 3,479,251).

d. Amount received from minority share holders includes share application money received from minority shareholders of MNEL ` Nil (Previous year : ` 105,030,000), RCTPL ` 170,000,000 (Previous year : ` 170,000,000), RGBL ` Nil (Previous year : ` 265,000,000) and SREPL ` 1,000 (Previous year : ` 1,000).

e. details of dues to related parties :

ParticularsAs at As at

March 31, 2012 March 31, 2011

GIL, the holding company 1,257,182,836 699,630,731 BWIOTPL 389,789 - ICTPL 3,064,434 438,139 Modern Toll Roads Limited, an associate company 26,520,000 26,520,000 Ansaldocaldaie Boilers India Private Limited, a subsidiary of the holding company 150,000,000 150,000,000

1,437,157,059 876,588,870

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 110

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notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 111

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8.

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 112

15 CaPital WoRK-in-PRoGRess

ParticularsAs at As at

March 31, 2012 March 31, 2011

Expenses incurred on construction, acquisition of self owned asset : Borrowing costs 2,875,556 1,901,414 Employee benefit expenses 3,576,140 734,272 Other expenses 58,109,374 50,547,078 Depreciation 83,049 1,554

64,644,119 53,184,318 Less : Capital work-in-progress written off 1,074,513 - total CaPital WoRK-in-PRoGRess 63,569,606 53,184,318

16 intanGiBle assets undeR deVeloPMent

ParticularsAs at As at

March 31, 2012 March 31, 2011

Contract expenditure 27,899,613,428 19,729,208,508 Developer fees 995,535,996 172,170,363 Concession fees 22 17 Borrowing costs 5,382,714,774 3,367,771,741 Negative grant 1,200,000,000 1,200,000,000 Employee benefit expenses 56,046,670 28,553,244 Other expenses 380,996,178 298,961,784 Depreciation 792,610 485,975

35,915,699,678 24,797,151,632 Less :Miscellaneous income 4,715,030 10,205,214

35,910,984,648 24,786,946,418 Less : Capitalised during the year 14,336,176,588 5,856,689,266 Less : Expenses incurred and capitalised under intangible asset under development written off 9,561,278 - total intanGiBle assets undeR deVeloPMent 21,565,246,782 18,930,257,152

17 GoodWill on Consolidation

ParticularsAs at As at

March 31, 2012 March 31, 2011

Goodwill on consolidation 620,620,850 650,620,849 Less : Capital reserve on consolidation 130,506,197 130,506,196 Net of goodwill over capital reserve 490,114,653 5 20,114,653 Goodwill amortised upto September 30, 2007 3,729,475 3,729,475 total GoodWill on Consolidation 486,385,178 516,385,178

Goodwill which was amortised upto September 30, 2007 is now tested for impairment at the end of every reporting period.

18 non-CuRRent inVestMents As at

March 31, 2012 Nos

As at March 31, 2011

NosParticulars

As at As at

March 31, 2012 March 31, 2011

trade investments Unquoted ordinary equity shares of ` 10 each, unlessotherwise statedinvestments in associates ESMSPL 2,143,950 2,143,950 13,896,234 11,170,287 MTL 24,470 24,470 203,612 244,700 AIPL 24,450 24,450 183,446 206,017

14,283,292 11,621,004 Less : Provision for diminution in value of investment 7,852,366 - total non-CuRRent inVestMents 6,430,926 11,621,004

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 113

a. Carrying amount of investments in associate companies :

(Goodwill) / Capital reserve on

investment (included in the

investment amount)

ParticularsOriginal cost of

investment

Opening balance of adjusted / accumulated

losses

Profit/(Loss) during the year

Carrying amount of investment

(A) (B) (C) (A+B+C)

esMsPl 2011-12 21,439,500 (10,269,213) 2,725,947 13,896,234 - 2010-11 21,439,500 (15,780,403) 5,511,190 11,170,287 (5,552,678)Mtl2011-12 244,700 - (41,088) 203,612 - 2010-11 244,700 - - 244,700 - aiPl2011-12 244,500 (38,475) (22,579) 183,446 - 2010-11 244,500 (38,475) - 206,025 - total 2011-12 21,928,700 (10,307,688) 2,662,280 14,283,292 - Total 2010-11 21,928,700 (15,818,878) 5,511,190 11,621,012 (5,552,678)

The above figures pertaining to the associate companies are based on the un-audited management accounts for the year ended March 31, 2012.

b. During the current year, the Group made a provision for Rs 7,852,366 (Previous year : Rs Nil) against the goodwill on acquisition of equity shares and diminution in value of investments of ESMSPL.

19 loans and adVanCes : Unsecured, considered good unless stated otherwise

Particulars Non-current Current March 31, 2012 March 31, 2011 March 31, 2012 March 31, 2011

Capital advances Unsecured, considered good : Related parties 871,227,667 915,259,808 - - Others 790,776,364 761,249,220 - -

(a) 1,662,004,031 1,676,509,028 - - depositsUnsecured, considered good :Security deposits 13,447,607 18,984,105 3,409,354 4,994,068 Other deposits 10,912,426 105,000 242,500 218,925

(B) 24,360,033 19,089,105 3,651,854 5,212,993 advance recoverable in cash or in kind Unsecured, considered good :Related parties 1,191,119 - 29,413,771 22,018,100 Others 203,507,375 154,169,828 38,132,352 49,575,172 Unsecured, considered doubtful :Others - - 2,631,756 2,631,756

204,698,494 154,169,828 70,177,879 74,225,028 Less : Provision made - - (2,631,756) (1,891,408)

(C ) 204,698,494 154,169,828 67,546,123 72,333,620 intercorporate loans given Unsecured, considered good :Related parties 5,100,000 70,834,659 - - Others 45,000,000 40,000,000 - - Unsecured, considered doubtful :Others 3,892,000 3,892,000

53,992,000 114,726,659 - - Provision for doubtful deposits (3,892,000) (3,892,000) - -

(d) 50,100,000 110,834,659 - - advance income-tax, net of tax provision Advance income-tax 179,233,373 155,332,112 - -

(e) 179,233,373 155,332,112 - -

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 114

Particulars Non-current Current March 31, 2012 March 31, 2011 March 31, 2012 March 31, 2011

Mat credit entitlement MAT credit available as on date 164,698,463 147,558,463 - - (F) 164,698,463 147,558,463 - - advance towards equity commitmentRelated party 12,994,800 12,994,800 - -

(G) 12,994,800 12,994,800 - - other loans and advancesCenvat/VAT/Service tax recoverable 25,000 25,000 14,788,470 27,035,168 Prepaid expenses - - 64,884,583 32,930,335

(H) 25,000 25,000 79,673,053 59,965,503 total loans and adVanCes(a + B + C + d + e + F + G + H) 2,298,114,194 2,276,512,995 150,871,030 137,512,116

a. dues from related parties :

Particulars Non-current Current

March 31, 2012 March 31, 2011 March 31, 2012 March 31, 2011

GIL 852,418,786 915,259,808 27,043,827 15,229,894 Gammon Power Limited, a subsidiary of the holding company 20,000,000 - - -

HBPL - - - 4,714,705 BWIOTPL - - - 30,989 ICTPL 5,100,000 - 2,321,673 1,281,361 PBPL - 70,834,659 - 687,829 AIPL - - - 25,051 MTL 12,994,800 12,994,800 48,271 48,271

890,513,586 999,089,267 29,413,771 22,018,100

b. Some of the eligible SPVs’ of the Group have availed the tax holiday period under section 80 IA of the Income-tax Act, 1962. As such the eligible SPVs’ Group during this period of tax holiday have to pay the Minimum Alternate Tax (‘MAT’) based on the profits as per their profits in the financial statements during the tax holiday period. The MAT paid by these SPVs during the said tax holiday period is available for adjustment against the normal tax payable by the said SPVs after the tax holiday period. The total amount of MAT credit entitlement to these SPVs is ` 164,698,463 (Previous year : ` 147,558,463).

20 tRade ReCeiVaBles

Non-current Current

March 31, 2012 March 31, 2011 March 31, 2012 March 31, 2011

outstanding for a period exceeding six months from the date they are due for payment

Unsecured, considered good :Related party - - 8,275,398 8,275,398 Others - - 251,624,991 137,912,068 Unsecured, considered doubtful :Others 92,174 24,182,170

- - 259,992,563 170,369,636 Less : Provision for doubtful debts - - (92,174) (24,182,170)

- - 259,900,389 146,187,466 other receivablesUnsecured, considered goodRelated parties - - 61,299,991 57,787,755 Others - - 14,332,779 101,343,906

- - 75,632,770 159,131,661 total tRade ReCeiVaBles - - 335,533,159 305,319,127

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 115

Non-current Current

March 31, 2012 March 31, 2011 March 31, 2012 March 31, 2011

details of trade receivables from related party outstanding for a period exceeding six months from the date theyare due for payment :GIL - - 8,275,398 8,275,398

other receivables :GIL - - 61,299,991 57,787,755

- - 69,575,389 66,063,153

21 otHeR assets Unsecured, considered good unless stated otherwise

Non-current Current

March 31, 2012 March 31, 2011 March 31, 2012 March 31, 2011

Accrued income - - 494,736,704 490,741,407 Balances in escrow bank accounts - IPO proceeds 33,505 593,007 - -

33,505 593,007 494,736,704 490,741,407 interest accrued receivableConsidered good :Related parties - - 18,724 6,664,351 Others 13,833,876 7,363,376 44,324,869 16,189,733 Considered doubtful :Others - - 692,183 692,183

13,833,876 7,363,376 45,035,776 23,546,267 Less : Provision made - - (692,183) (692,183)

13,833,876 7,363,376 44,343,593 22,854,084 total otHeR assets 13,867,381 7,956,383 539,080,297 513,595,491

a. Accrued income includes amounts of ` 468,579,225 (Previous year : ` 378,329,684) receivable from NHAI against the annuities, ` 13,258,750 (Previous year : ` 100,089,865) towards grant from NHAI and the balance of ` 12,898,729 (Previous year : ` 12,717,126) from a client. These are unbilled revenues accrued as on March 31, 2012 to the SPVs of the Group.

b. Balances in escrow bank accounts of ` 33,505 (Previous year : ` 593,007) of the Initial Public Offer, made by the holding company of the Group, pertains to the refund orders not encashed by the investors. This amount is transferrable to Investors Protection Fund in the year 2015.

22 CuRRent inVestMents As at

March 31, 2012 Nos

As at March 31, 2011

NosParticulars

As at As at

March 31, 2012 March 31, 2011

non-trade investments (valued at cost unless statedotherwise)Quoted investments fully paid-up secured, redeemable, non-convertible debentures of ` 1,000,000 per unit. Deutsche Investments India Private Limited - 30 - 30,000,000

total CuRRent inVestMents - 30,000,000

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 116

23 inVentoRies (Valued at lower cost and net realisable value)

ParticularsAs at As at

March 31, 2012 March 31, 2011

Stores and consumables 35,071,346 77,705,757 total inVentoRies 35,071,346 77,705,757

From current year, the Group has changed its accounting policy of valuing the inventory, the effect of which is not material. The Group’s inventories are primarily for carrying out the operations and maintenance activities.

24 CasH and CasH equiValents

Particulars Non-current Current

March 31, 2012 March 31, 2011 March 31, 2012 March 31, 2011

Balances with banks :On current accounts - - 2,308,482,949 1,369,691,151 Debit balance in overdraft account - - 5,502,989 1,498,259 Balance in Initial Public Offer of escrow bank account 33,505 593,007 - -

other bank balances :Deposits with banks - - 190,776,638 88,762,718

others :Cash in hand - - 6,606,119 3,601,925 Funds in transit - - 587,800 28,104,528

33,505 593,007 2,511,956,495 1,491,658,581 Amount disclosed under other assets [note 21(b)] (33,505) (593,007) - - total CasH and CasH equiValents - - 2,511,956,495 1,491,658,581

25 ReVenue FRoM PRoJeCts

ParticularsAs at As at

March 31, 2012 March 31, 2011

Annuity income 1,256,664,809 1,166,020,000 Toll revenue 1,011,026,054 549,869,351 Revenue from port operations 1,249,025,570 1,270,620,424 Revenue from road maintenance 228,755,909 172,266,647 Revenue from power projects - 1,872,963 Revenue from developer activities 246,237,536 - Air cargo income - 5,192,894 total ReVenue FRoM PRoJeCts 3,991,709,878 3,165,842,279

26 otHeR oPeRatinG ReVenue

ParticularsAs at As at

March 31, 2012 March 31, 2011

Interest on early completion bonus 40,257,867 82,600,027 Operating grant received 171,532,565 100,086,185 Others 25,884,518 10,119,532 total otHeR oPeRatinG ReVenue 237,674,950 192,805,744

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 117

Interest on early completion bonus for the year ended March 31, 2012 represents interest awarded to the two subsidiaries of the Group in arbitration which was fully realised in the current year. The interest for the current year, includes an interest amount of ̀ 40,162,850, contractually due to these subsidiaries over and above the amount received in arbitration. This amount has been recognised on the basis of Orders received in favour of the subsidiaries from a single and divisional bench of the Delhi High Court during the year. The Delhi High Court orders have been challenged by the NHAI in the Supreme Court of India. Based on legal advice received, the management of these subsidiaries believes the matter will ultimately be decided in their favour.

As per the terms of the concession agreement signed between MNEL, a subsidiary of the Group and NHAI, its client, MNEL, during the operating period, is entitled to receive an operating grant of `1,080,000,000. During the current year, MNEL received operating grant of ` 245,581,000 (Previous year : ` Nil) after recoveries of ` 12,779,000.

27 otHeR inCoMe

ParticularsAs at As at

March 31, 2012 March 31, 2011

interest income on : Intercorporate deposits 7,192,722 7,294,203 Bank deposits 5,358,627 7,880,382 Others 12,656,532 20,275,443

25,207,881 35,450,028 dividend income on :Current investments 23,870,027 36,727,994

23,870,027 36,727,994 Miscellaneous income :Net gain on sale of current investments 7,826,973 12,148,354Others 7,463,518 16,014,766

15,290,491 28,163,120total otHeR inCoMe 64,368,399 100,341,142

28 PRoJeCt exPenses

ParticularsAs at As at

March 31, 2012 March 31, 2011

Material handling system's maintenance expenses 36,900,000 39,900,000 Port cargo handling expenses 400,058,610 354,254,616 Power and fuel 47,893,814 48,189,370 Repairs and maintenance of project assets, plant and equipments 78,155,152 74,779,385 Royalty on revenue 39,161,063 44,309,420 Sub-contracting expenses 333,700,159 237,167,440 Penalty on shortfall of minimum guarantee throughput 40,225,467 11,360,662 Other project expenses 116,194,274 128,557,762 Periodic maintenance expenses 282,103,000 - total PRoJeCt exPenses 1,374,391,539 938,518,655

29 eMPloyee BeneFits exPense

ParticularsAs at As at

March 31, 2012 March 31, 2011

Salaries, wages and bonus 181,364,964 128,602,839 Contributions to provident fund 7,380,824 5,231,741 Directors' remuneration including contributions to provident fund 46,249,330 24,078,124 Staff welfare expenses 11,138,778 8,831,612 Provision for leave encashment 5,222,296 2,230,841 Provision for gratuity 1,920,013 2,135,515 Employees 'ESOP' compensation cost (57,642) (226,898)Cash alternative settlement of ESOP scheme 3,537,253 11,436,424 total eMPloyee BeneFits exPense 256,755,816 182,320,198

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 118

30 otHeR exPenses

ParticularsAs at As at

March 31, 2012 March 31, 2011

Professional and consultancy fees 80,296,143 68,443,929 Insurance charges 7,462,478 505,492 Directors' fees and commission 2,300,000 2,184,444 Office rent 14,556,649 4,203,267 Hire of equipments 3,259,142 - Fuel charges 3,899,383 - Travelling and motor car expenses 17,600,235 16,780,856 Tender document expenses 25,302,705 20,040,710 Payment to auditors 8,859,047 7,293,036 Preliminary and share issue expenses 22,157,363 9,659,752 Guarantee bond commission 19,602,988 10,722,791 Miscellaneous expenses 46,190,713 35,175,046 Assets written off 10,104,861 30,356,310 Loss on sale of assets 3,376,070 1,898,853 Loss on sale of investments 35,412,632 - Provision for diminution in value of investments (including goodwill written off) 21,987,235 - Provision for doubtful debts, advances & bad debts 15,457,915 21,310,640 total otHeR exPenses 337,825,559 228,575,126

31 exCePtional iteMs

ParticularsAs at As at

March 31, 2012 March 31, 2011

Unamortised portion of periodic maintenance written off 745,405,210 - Depreciation for prior years 1,901,748 - Prior period expenses capitalised written back - -

747,306,958 - Less :Developer fees eliminated earlier, now reversed 650,258,901 -

650,258,901 - total exCePtional iteMs 97,048,057 -

a. The Group undertakes various projects on build-operate-transfer basis as per the service concession agreements with the government authorities. During the current year, the developer fees incurred by the operator on the project with the Group were considered as exchanged with the grantor against toll collection / annuity rights from such agreements and therefore the revenue from such contracts were considered realised by the Group and not eliminated for consolidation under AS-21 Consolidated Financial Statements. The revenue during the current year from such contracts are not eliminated to the extent of ` 246,237,536. Further, the Group has reflected the credit of the developer fees of ` 650,258,901 upto March 31, 2011 as an exceptional item.

b. Hitherto, periodic maintenance cost including resurfacing expenditure required to be undertaken by the operator under its BOT contracts at specified intervals were capitalised to the project asset. During the current year, in line with industry practice of the relevant SPVs have recognised a provision for such expenditure on a systematic basis over the period for which such obligations are to be carried out. Further, these SPVs have debited such un-amortised expenditure of ` 745,405,210 as at March 31, 2011 to the statement of profit and loss as an exceptional items

c. Exceptional items are therefore the net of the unamortised periodic maintenance expenditure written off, ` 745,405,210, depreciation for prior years ` 1,901,748 and reversal of elimination of developer fees of ` 650,258,901 resulting in a net debit of ` 97,048,057.

32 FinanCe Costs

ParticularsAs at As at

March 31, 2012 March 31, 2011

Interest expense 1,460,215,157 986,967,557 Other finance costs 96,378,817 12,603,602 total FinanCe Cost 1,556,593,974 999,571,159

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 119

33 dePReCiation and aMoRtisation

ParticularsAs at As at

March 31, 2012 March 31, 2011

Depreciation on tangible asset 65,005,384 63,912,662 Amortisation of intangible asset 713,986,920 785,220,436 total dePReCiation and aMoRtisation 778,992,304 849,133,098

34 Significant accounting policies and notes to this consolidated financial statement are intended to serve as a means of informative disclosure and a guide to better understanding the consolidated position of the companies. Recognising this purpose, the Group has disclosed only such policies and notes from the individual financial statements, which fairly presents the needed disclosures.

35 RiGHts issue During the period, the holding company GIPL, has filed a draft letter of offer with Securities and Exchange Board of India (“SEBI”) for a proposed issue

of equity shares for an amount not exceeding ` 2,000,000,000 on a rights basis to the existing shareholders of GIPL as on the record date.

36 annuity ReCeiVaBle By CBiCl Under the Concession Agreement dated October 27, 1999, executed between CBICL, GIL the holding company of the Group, Government of

Kerala (GOK) and Greater Cochin Development Authority (GCDA) dated January 6, 2001; the entire project has been assigned to CBICL as a Concessionaire for the purpose of developing, operating and maintaining the infrastructure facility on BOT basis for 13 years and nine months.

Subsequently, a Supplementary Concession Agreement is to be executed as per the Government of Kerala’s Order Nos. G.O. (M.S.) No. 11/2005/PWD dated January 24, 2005 and G.O. (M.S) No. 16/2005/PWD dated March 1, 2005 between the Government of Kerala, Greater Cochin Development Authority and CBICL. In terms of the order, the period of concession has been increased by 6 years and CBICL is entitled to yearly annuity receipts which it is accounting as Trade receivables. The annuities have not been collected till date. CBICL has not made any provision against the said receivables. As the annuities has not been received till date, CBICL has initiated arbitration procedures.

37 eaRninGs PeR sHaRe (ePs)

ParticularsAs at As at

March 31, 2012 March 31, 2011

Profit/(Loss) after tax (254,181,145) 171,686,172 Outstanding equity shares at the end of the year 728,763,618 728,740,162 Weighted average number of equity shares outstanding during the year - Basic 728,755,992 727,527,130 Weighted average number of equity shares outstanding during the year - Diluted 729,105,907 728,045,403 Earnings Per Share - Basic (` ) (0.35) 0.24 Earnings Per Share - Diluted (` ) (0.35) 0.24

ParticularsAs at As at

March 31, 2012 March 31, 2011

Nominal value of equity shares (` per share) 2 2 For Basic ePs :Total number of equity shares outstanding at the beginning of the year 728,740,162 724,439,750 Add : Issue of equity shares against options granted to employees 23,456 4,300,412 Total number of equity shares outstanding at the end of year 728,763,618 728,740,162 Weighted average number of equity shares at the end of the year 728,755,992 727,527,130 For dilutive ePs :Weighted average number of shares used in calculating basic EPS 728,755,992 727,527,130 Add : Equity shares for no consideration arising on grant of stock options under ESOP 3,565,448 3,637,418 Less : Equity shares for no consideration arising on grant of stock options under ESOP forfeited / lapsed (included above) 3,215,533 3,119,145

Weighted average number of equity shares used in calculating diluted EPS 729,105,907 728,045,403

GIPL, the holding company was an unlisted company at the date when options were granted under GIPL ESOP 2007 scheme and therefore the intrinsic value was determined on the basis of an independent valuation by following the price to Net Asset Value (NAV) method. If the employees stock based compensation cost been determined in accordance with the fair value approach described in the guidance note, the Group’s net profit for the year ended March 31, 2012 as reported would have changed to amounts indicated below:

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 120

ParticularsYear ended Year ended

March 31, 2012 March 31, 2011

Profit after tax as reported (254,181,145) 171,686,172 Add: Stock based compensation expense included in the reported income (57,642) (226,898)Less: Stock based compensation expenses determined using fair value of options 7,760,545 9,787,067 Net Profit (adjusted) (261,999,332) 161,672,207

earnings Per share : Basic earnings per share as reported (0.35) 0.24 Basic earnings per share (adjusted) (0.36) 0.22 Diluted earnings per share as reported (0.35) 0.24 Diluted earnings per share (adjusted) (0.36) 0.22 Weighted average number of equity shares at the end of the year 728,755,992 727,527,130 Weighted average number of shares considered for diluted earnings per share (adjusted) 729,105,907 728,045,403

38 lease One of the SPV’s has taken land on lease from Visakhapatnam Port Trust under non-cancellable operating lease agreements and temporary

housing from others under cancellable operating lease agreements. Total rental expense under non-cancellable operating leases was ̀ 5,938,636 (Previous year: ` 5,916,267) and under cancellable operating leases was ` 661,604 (Previous year: ` 877,318) which has been disclosed as lease rentals in the statement of profit and loss.

Further, another SPV has also taken an office premises on a non-cancellable operating lease. The monthly lease rents amounts to ` 836,000 (Previous year : ` 836,000). The disclosures as per Accounting Standard 19 ‘Leases’ notified under the Companies (Accounting Standards) Rules, 2006 are as under:

ParticularsYear ended Year ended

March 31, 2012 March 31, 2011

Minimum lease payments :Payable not later than 1 year 18,022,636 19,280,075 Payable later than 1 year and not later than 5 years 57,840,544 76,008,515 Payable later than 5 years 87,099,995 93,038,631 Lease payment recognised in the statement of profit and loss 17,968,105 6,964,117

The lease agreements do not provide for an option to the SPVs’ to renew the lease period at the end of the non-cancellable period. There are no exceptional / restrictive covenants in the lease agreements.

39 Related PaRty tRansaCtions

a. Names of the related parties and related party relationships

i) entities where control exists :GIL the holding company

ii) Joint ventures :BWIOTPLHBPL became a subsidiary from July 28, 2011ICTPLSEZAL

iii) associates :AIPLACBIPL subsidiary of the holding company, GILESMSPLMTL

iv) Key management personnel :Abhijit RajanKishor Kumar MohantyParag Parikh

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 121

b. Related party transactions

Transactions Entities where control exists Associates Key management

personnel Total

Operations and maintenance income :GIL 181,382,669 - - 181,382,669

(170,803,405) (-) (-) (170,803,405)Operations & maintenance expenses :GIL 181,382,669 - - 181,382,669

(170,803,406) (-) (-) (170,803,406)Intangible asset development (materials supply) :GIL 491,756,326 - - 491,756,326

(836,555,668) (-) (-) (836,555,668)Intangible asset development (contract expenditure) :GIL 6,704,333,405 - - 6,704,333,405

(5,596,159,010) (-) (-) (5,596,159,010)Advances given against EPC contracts : GIL 254,173,425 - - 254,173,425

(1,264,650,314) (-) (-) (1,264,650,314)Advances recovered against EPC contracts :GIL 152,603,934 - - 152,603,934

(821,122,962) (-) (-) (821,122,962)Advance against material supply liquidated :GIL 135,000,000 - - 135,000,000

(-) (-) (-) (-) Rent paid :GIL 700,000 - - 700,000

(1,200,000) (-) (-) (1,200,000)Insurance claims received : GIL - - - -

(12,986,049) (-) (-) (12,986,049)Insurance claims transferred : GIL 712,654 - - 712,654

(-) (-) (-) (-) Contribution received from minority shareholders :GIL - - - -

(73,503,150) (-) (-) (73,503,150)Refund of minority contribution / conversion of minority contribution into equity :

GIL - - - - (203,503,150) (-) (-) (203,503,150)

Managerial remuneration :Mr. Kishor Kumar Mohanty - - 22,173,328 22,173,328

(-) (-) (-) (-) Mr. Parag Parikh - - 6,708,482 6,708,482 (-) (-) (-) (-) Mr. Himanshu Parikh - - - -

(-) (-) (11,343,479) (11,343,479)Mr. R.K. Malhotra - - 11,367,520 11,367,520

(-) (-) (-) (-) Mr. Parvez Umrigar - - - -

(-) (-) (6,734,645) (6,734,645)

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 122

Transactions Entities where control exists Associates Key management

personnel Total

Gross value of stock options vested : Mr. Parvez Umrigar - - - - (-) (-) (47,520,000) (47,520,000)

Finance provided for expenses and on account payments :GIL 1,026,119 - - 1,026,119

(25,450,230) (-) (-) (25,450,230)Amount liquidated towards the above finance :GIL 836,284 - - 836,284

(19,472,322) (-) (-) (19,472,322)Finance received (including loans and equity contribution in cash or in kind) :GIL - - - -

(736,200,000) (-) (-) (736,200,000)Mr. Parvez Umrigar - - - -

(-) (-) (38,400,000) (38,400,000)Finance received for expenses & on account payments :GIL 275,894 - - 275,894

(2,337,933) (-) (-) (2,337,933)Amount liquidated towards the above finance :GIL 2,042,237 - - 2,042,237

(2,337,100) (-) (-) (2,337,100)Interest paid during the year :GIL 88,344,000 - - 88,344,000

(40,561,611) (-) (-) (40,561,611)Deposit towards purchase of beneficial interest of equity shares :GIL - - - -

(53,503,150) (-) (-) (53,503,150)Advance received for purchase of land :ACBIPL - - - -

(-) (150,000,000) (-) (150,000,000)Retention money recovered :GIL 152,392,455 - - 152,392,455

(329,883,844) (-) (-) (329,883,844)Retention money refunded :GIL 155,905,258 - - 155,905,258

(326,371,041) (-) (-) (326,371,041)Outstanding balances payable :GIL 1,654,998,546 - - 1,654,998,546

(685,628,426) (-) (-) (685,628,426)ACBIPL - 150,000,000 - 150,000,000

(-) (150,000,000) (-) (150,000,000)

(Previous year’s figures in brackets)

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 123

40 ContinGent liaBilities

Group’s share in contingent liability not provided for in the books of accounts.

ParticularsYear ended Year ended

March 31, 2012 March 31, 2011

Claims against Company not acknowledged as debt 308,162,328 247,282,545 Counter guarantees given to banks 2,257,271,800 2,433,276,800 total 2,565,434,128 2,680,559,345

a. The contingent liability, detailed hereinabove includes the Group’s share of contingent liability in the joint venture companies amounting to ` Nil (Previous year :` 23,953,692).

b. Claims against the SPVs of a Group not acknowledged as debt includes

i) As per the intimation received u/s section 143(1) of the Income Tax Act, 1961 for the assessment year 2007-08, from the Income-tax department, ` 7,334,466 is payable by a subsidiary of the Group. However, the assessing officer has not given credit for the TDS certificates amounting to ` 18,121,978 while assessing the tax payable. The original copies of the said TDS certificates were submitted to the assessing officer on February 4, 2010 for which acknowledgement from the department has been received. The management of the subsidiary is of the view that the said order will be rectified after accounting the TDS certificates, hence the liability of ` 7,334,466 has not been provided for in their books of accounts.

ii) An amount of ` 177,699,900 claimed by the collector and district registrar, Rajahmundry, pursuant to and Order dated March 15, 2005, as deficit stamp duty payable on the concession agreement entered into between a subsidiary of the Group and NHAI, classifying the concession agreement as a ‘lease’ under Article 31(d) of the Indian Stamp Act. The subsidiary has impugned the Order by way of a writ petition before the High Court of Andhra Pradesh at Hyderabad. No provision is considered necessary in respect of the said demand, as the management of the subsidiary believes that there is no contravention of the Indian Stamp Act.

iii) A winding up petition against a subsidiary of the Group, has been filed by a creditor for recovery of ` 14,140,343. The subsidiary is disputing the said amount and has recognised `1,685,168 payable as there are claims and counter claims by both parties. Pending the final outcome of such proceeding, the claim from the creditor is disclosed as a contingent liability. The management of the said is of the view that the same would be settled and does not expect any additional liabilities towards the same.

iv) Under the License Agreement (LA), Mumbai Port Trust (‘MbPt’), is entitled to recover electricity charges from a joint venture SPV, against the existing Ballard Pier Station (‘BPS’) terminal. The rate to be charged by MbPT is the rate charged by the electric power supplier plus 7.5% overhead charges. MbPT is charging fixed demand charges, due to which the per unit of electricity is not matching with the with the rate. Since the SPV has also agreed for payment of fixed contract demand charges, the total liability for electricity expenses are provided in its financial statements in the current year. A provision of Rs approximately ` 2,500,000 has been made towards differential electricity expenses in the books of the SPV.

v) The penalty for non-achievement of Minimum Guaranteed Throughput (‘MGT’) of approximately of ` 46,000,000 payable to the MbPT as per the License Agreement has not been provided for by a joint venture SPV in their financial statements because under an arrangement, the said SPV is eligible to be indemnified by one of the shareholders in respect of liability upto March 31, 2010. Under the revised arrangement dated December 23, 2011, the amount of MGT penalty is to be borne by the said SPV. Hence, during the current year the liability for MGT has been provided in the said SPV’s books.

vi) The projects of a biomass SPV in the state of Haryana, has been terminated during the year. Due to this, the said SPV has written off all the capitalised expenses incurred till date. The SPV is taking steps to recover all its dues while the management is exploring other business opportunities. Pending this, the accounts of the SPV are not prepared on a Going Concern Basis. In the opinion of the management, current assets, loans & advances have a realisable value, atleast equal to its value stated in the balance sheet after considering the provision made. There are no contingent liabilities as at March 31, 2012 and March 31, 2011.

41 CoMMitMents

a. Capital commitments

The total capital commitment as on March 31, 2012 is ` 9,018,442,874 (Previous year :` 16,370,605,061).The capital commitments are in respect of projects where the concession agreements have been signed and does not include projects where only Letters of Intents are held.

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 124

b. export obligations

ParticularsYear ended Year ended

March 31, 2012 March 31, 2011

Under EPCG Scheme 228,966,912 208,953,728 total 228,966,912 208,953,728

c. other commitments i) In terms of the individual Contracts signed by SPVs they are required to carry major periodic maintenance of the roads they are operating

as a part of commitment against receipt of Tolling Rights and / or Annuities. The said SPVs have made provisions towards the same in their respective financial statements.

ii) One of the SPV’s engaged in generating power from a bagasse power plant has committed to purchase bagasse when the power

plant becomes operational. The total commitment to purchase the bagasse, upto March 31, 2012, is ` 60,000,000 (Previous year : ` 60,000,000).

42 seGMent RePoRtinG

The Group’s operations constitutes a single business segment namely “Infrastructure Development” as per Accounting Standard (AS) - 17 “Segment Reporting”. Further the Group’s operations are within single geographical segment which is India.

infrastructure activities

Infrastructure activities comprise of all the activities of investing in infrastructure projects, providing advisory services and operating and maintaining of Public Private Partnership Infrastructure Projects.

43 ReMuneRation to auditoRs

Remuneration to auditors of the subsidiaries and joint ventures not audited by any of the joint auditors of the Company is grouped with professional fees.

44 deRiVatiVe instRuMents and unHedGed FoReiGn CuRRenCy exPosuReOne SPV of the Group has the following unhedged exposure in foreign currency as at March 31, 2012.

Particulars Currency Foreign Currency Indian Rupees

Buyers credit EURO 1,491,450 101,241,073

The accompanying notes are an integral part of the financial statements.

As per our report of even date For and on behalf of the Board of Directors of Gammon Infrastructure Projects Limited

For natvarlal Vepari & Co. For s.R. Batliboi & Co. abhijit Rajan Himanshu Parikh Kishor Kumar MohantyFirm Registration No.: 106971W Firm Registration No.: 301003E Chairman and Vice Chairman Managing DirectorChartered Accountants Chartered Accountants Managing Directorn. Jayendran per Hemal shah Parag Parikh R. K. Malhotra C. C. dayalPartner Partner Whole-time Director Whole-time Director DirectorMembership No : 40441 Membership No: 42650 & CFO

sanjay sachdev naresh Chandra s. C. tripathiDirector Director DirectorHomai a. daruwallaDirectorG. sathis ChandranCompany Secretary

Place : Mumbai Place : MumbaiDate : May 9, 2012 Date : May 9, 2012

notes to the Consolidated financial statements for the year ended March 31, 2012(All amounts in Indian Rupees unless otherwise stated)

F - 125

235

DECLARATION Our Company certifies that all relevant provisions of Chapter VIII read with Schedule XVIII of the SEBI Regulations have been complied with and no statement made in this Placement Document is contrary to the same. Our Company further certifies that all the statements in this Placement Document are true and correct.

Signed by: Sd/- Kishor Kumar Mohanty

Managing Director

Date: September 4, 2014 Place: Mumbai

236

DECLARATION

We, the Directors of the Company certify that:

(i) the Company has complied with the provisions of the Companies Act and the rules made thereunder;

(ii) the compliance with the Companies Act and the rules does not imply that payment of dividend or interest or repayment of debentures, if applicable, is guaranteed by the Central Government;

(iii) the monies received under the offer shall be used only for the purposes and objects indicated in the Placement Document;

Signed by:

Sd/- Sd/-

Kishor Kumar Mohanty

Managing Director

Parag Parikh

Whole Time Director & Chief Financial Officer

I am authorized by the Board of Directors of the Company vide resolution number 6 dated June 20, 2014 to sign this form and declare that all the requirements of Companies Act, 2013 and the rules made thereunder in respect of the subject matter of this form and matters incidental thereto have been complied with. Whatever is stated in this form and in the attachments thereto is true, correct and complete and no information material to the subject matter of this form has been suppressed or concealed and is as per the original records maintained by the promoters subscribing to the Memorandum of Association and the Articles of Association.

It is further declared and verified that all the required attachments have been completely, correctly and legibly attached to this form.

Signed by

Sd/-

Kishor Kumar Mohanty Managing Director Date: September 4, 2014

Place: Mumbai

237

GAMMON INFRASTRUCTURE PROJECTS LIMITED Registered Office

Gammon House, Veer Savarkar Marg, Prabhadevi, Mumbai – 400 025.

Telephone: +91 22 6661 4000 Fax: +91 22 6661 4025 Website: www.gammoninfra.com CIN: L45203MH2001PLC131728

Corporate Office Orbit Plaza, 5th Floor,

Plot No. 952/954, New Prabhadevi Road, Prabhadevi, Mumbai – 400 025.

Telephone: +91 22 6748 7200 Fax: +91 22 6748 7201 Contact Person: Mr. G. Sathis Chandran

Address of Compliance Officer: Mr. G. Sathis Chandran

Company Secretary & Compliance Officer Gammon Infrastructure Projects Ltd.

Orbit Plaza, 5th Floor, Plot No. 952/954, New Prabhadevi Road, Prabhadevi, Mumbai – 400025

Tel: +91 22 67487260; Fax: +91 22 67487201; Email: compliances@gammoninfra.com

BOOK RUNNING LEAD MANAGER

Inga Capital Private Limited 21st Floor, Naman

Midtown, A wing, Senapati Bapat Marg, Elphinstone (West), Mumbai 400013 Tel:+91 22 2498 2919 Fax: +91 22 2498 2956

IDFC Securities Limited

Naman Chambers, C-32, G-Block, Bandra-Kurla Complex, Bandra

(East), Mumbai - 400 051

Tel: +91 22 6622 2600 Fax: +91 22 6622 2501

Equirus Capital Private Limited Fortune 2000, 4th Floor, 'A' Wing,

Bandra Kurla Complex,

Bandra (East), Mumbai-400 051

Tel: +91 22 2653 0600Fax: +91 22 2653 0601

ICICI Securities Limited ICICI Centre, H.T. Parekh

Marg, Churchgate, Mumbai 400 020

Tel: +91 22 2288 2460 Fax: +91 22 2282 6580

JOINT AUDITORS TO OUR COMPANY

M/s. Natvarlal Vepari & Company

Chartered Accountants Oricon House

4th floor, 12 K Dubash Marg Mumbai 400 023

M/s. S.R. Batliboi & Co. LLP Chartered Accountants 14th Floor, The Ruby

29 Senapati Bapat Marg Mumbai 400 028

LEGAL ADVISOR TO THE ISSUE

Link Legal - India Law Services Thapar House, Central Wing

First Floor, 124 Janpath New Delhi 110 001

India

INTERNATIONAL LEGAL COUNSEL TO THE BOOK RUNNING LEAD MANAGERS WITH RESPECT TO INTERNATIONAL SELLING AND TRANSFER RESTRICTIONS

Dorsey and Whitney LLP 50 South Sixth Street, Suite 1500

Minneapolis, Minnesota 55402-1498 United States of America