indiareit apartment fund

STRICTLY CONFIDENTIAL

INDIAREIT APARTMENT FUND PIRAMAL FUND MANAGEMENT PVT LTD

12

CONTENTS

PAGE 1STRICTLY CONFIDENTIAL

INDIAREIT APARTMENT FUND : STRATEGY & OVERVIEW

PIRAMAL FUND MANAGEMENT : CREDENTIALS & CAPABILITIES


EXECUTIVE SUMMARY

Target Gross Equity IRRs of 26%+

Competitive Advantages

Strong sponsor: Piramal Fund Management provides capital across the risk spectrum, providing Indiareit access to attractive off market deals: Managing INR 7,554 Cr at present across 7 funds and 3 third party mandates; Disbursed INR 2925 Cr through proprietary real estate loan book

Established track record: Deployed INR 3,191 Cr across 33 projects from 7 funds raised and achieved exits worth INR 1,228 Cr Trusted fiduciary: Won three mandates for managing third party portfolios, and has a successful track record of executing such mandates Highly experienced team: Led by Mr. Khushru Jijina, with an experienced team of 49 professionals and strong on-ground presence with offices in 4

key cities in India

In-house development skills and focus on physical underwriting: Uniquely positioned with a team comprising of professionals from real estatedevelopment background and an established development team. Consequently, it possesses capabilities of taking over projects from developers toensure project completion, either through 3rd party developer or through own development team in specific situations

Strong developer relationships: Excellent relationship with development partners exhibited by repeat transactions with select developer partners Warehousing benefits: Willingness of the Sponsor to warehouse deals in advance of fundraising, providing access to deals with short funding

timelines, and deployment immediately on drawdown; efficient utilization of drawdowns

Fund Strategy

To acquire residential apartments in Tier 1 Markets

The fund aims to underwrite projects at a significant discount to the market, by offering a bulk purchase of residential units, to the developer

Offer liquidity / a funding solution to the developer but translated into purchase of units at a discount to prevailing market price

Focus on select locations that stand to benefit from the on streaming of infrastructure during the investment tenure

Fund Structure

Fund Size: INR. 350 Crs with a green shoe option of INR. 350 Crs Sponsor Commitment: At least 7.5% of basic fund size Minimum Commitment: INR1 Cr, and subsequently in multiples of INR1 lakh Initial Drawdown: 25% of the Commitment Amount Fund Tenure: 5 years Fees: Setup: Upto 2.00%, Management Fees: 1.50% p.a. on the drawdown collected; Performance Fee: 20% over a 10% hurdle (without catch up)


INDIAREIT APARTMENT FUND

01


Opportune timing to create a first to market fund strategy for buying apartment units

CURRENT MARKET SCENARIO

Slow sales velocity and hence limited internal accruals

Existing scheduled repayments adding further pressure to cash flows

Delay in approvals; increase in construction costs; change in regulations and policy paralysis further increases carrying

cost of project thereby increasing burden on liquidity

Limited Sources / High Cost of Funding Banks reducing exposure; NBFC terms inflexible

Execution money required developer actually focused on development in order to advance cash flows from existing sales

All of above creates a situation for tweaking fund model to ensure an aligned position i.e. win-win for all stakeholders


Creates win-win for all stakeholders i.e. developer and investors

FUND OVERVIEW

INVESTOR RATIONALE

Ability to get value deals by committing to a bulk purchase; ability to leverage existing relationships withdevelopment partners to originate attractive opportunities on a sustainable basis

Ability to participate in a secured position with benefit of diligence and structuring vis a vis an individualtransaction

Quicker realization of attractive risk adjusted returns vis a vis retail participation at prevailing market price

DEVELOPER RATIONALE

Enables developer to advance construction and delivery of initial sales with institutional participation Increased pace and visibility of construction also results in better positioning vis a vis comparable projects

and drives further open market sales Also enables developer to avoid a drop in price for open market; and ride the upside beyond a certain

threshold

FUND THEME

To acquire residential apartments in Tier 1 Markets at a significant discount to the market, by offering abulk purchase of residential units, to the developer

The fund will underwrite units only i.e. physical square feet rather than financial participation Well defined use of funds, appropriate security and monitoring mechanism and developer alignment of

paramount importance in underwriting process Focus on investments in select projects at an attractive price points and appropriate stage of entry


A combination of structured / downside protected and upside only transactions

INVESTMENT MATRIX

PRE LAUNCH STAGE LAST MILE FUNDING

Investments in early stage projects where construction has not commenced

Investments in projects at an advanced stage where funds are required for completion

TENURE: 3 5 YEARS TENURE: 2 3 YEARS

Co-investment Opportunity

Anchor investors will be eligible for specific co-invest opportunities alongside the Fund Co-investment opportunities (where available) will be restricted to the purchase of a maximum of one unit per investor, on a first

come first served basis An upfront fee of 2% will be charged on all co-investments; subsequently co-investments would NOT be subject to any further

management or performance fee

Structured Investments or Upside OnlyInvestments either with a minimum guaranteed returnwith sharing of the upside or entirely upside driven


UNDERWRITING PROCESS

Typical Underwriting & Security Fund to retain exclusive charge of allotted units (and additional area as appropriate for downside protection)

Units to be transferred to separate SPV and excluded from any mortgage / charge being created by developer

Separate escrow account to be created for identified units; operated by Fund independently

Sales price / sales schedule with respect to allotted units to be decided by the Fund

Completion of RCC structure within specified time period

Drag on developer sales to ensure that sales of allotted units are equalized

Fund also retains right to sell independently without transfer charges

~1.5x cash cover based on prevailing market price / ~2x cash cover based on proposed exit price

Execution of collateral - Hypothecation of receivables from sale of allotted units / promoter and corporate guarantees /Promissory notes & PDCs amounting to minimum return

Steps Brief overview

Deal sourcing Source investment opportunities through strong network and local relationships; opportunities to abidewith investment guidelines established for the platform

Deal evaluation Analyse potential returns and risks, assuring that the deal meets return requirements and fits in the riskappetite of the investors; present proposal to the Investment Committee

Investment decision IC to take investment decision; disbursement post satisfactory completion of diligence Final disbursement post creation of escrow; execution of collateral; relevant NOCs from lenders etc

Investment management Active management and oversight of the investment post fund infusion; regular asset managementfunctions and distributing returns to investors

1

2

3

4

Robust process to benefit from Piramal Groups sourcing and evaluation capabilities


SEED TRANSACTION

RESIDENTIAL PROJECT IN MUMBAIInvestment Size INR 50 Cr

Deal Type Late Stage Apartment Buyout (units selected based on saleability and pace of construction)

Project Type Slum Rehabilitation project under regulation 33(10) of the Development Control Regulations

Return*

IRFs acquisition price yields an effective discount from the current sales price of INR 14,000 psf, of which 35% - 55% is payableimmediately as per the Construction Linked Plan depending on unit in question

Minimum IRR of 16.5% (at INR 14,000); Upside until INR 16,000 shared 67:33; Upside beyond INR 16,000 shared 20:80 Exit Price: 14,000 (Current Market Price) Gross Return: 19.1% Exit Price: 15,000 Gross Return: 24.1% / Exit Price: 16,000 Gross Return: 28.9%

*Effective realization / IRRs at different price levels may differ slightly depending on actual unit being underwrittenTenure Average Tenure of 2 Years

Primary Security First and exclusive charge on the identified apartments and the escrowed cashflows from sale of the said apartments

Other Security Additional 20% area offered as a security. The additional area may be sold if the funds returns are not met 100% share pledge, Undated Cheques, Promissory Notes, Corporate and Personal Guarantees

Control Mechanisms Escrow of Cashflows / Right to appoint Directors

Risks and Mitigants

Cashflow Sensitivity 1.85x cash cover at the proposed exit price of INR 16,000 psf and 1.62x cover assuming no appreciation from the current levels

of INR 14,000 psf

Discounted price along additional area for price protection adequately covers repayment of interest and returns

Risks Mitigants

Sales Risk 45% of the area has been sold Average sales velocity of ~32,500 sft in past 6 months Established price point. Even if the price does not increase from current levels

after 2 years, investment yields a Gross IRR of 19.1%

Execution Risk All major approvals are in place and Principal Contractor for execution is L&T(a highly reputed Indian contracting company)

As per the Construction Linked Payment plan 90% of the payment will be collectedin the next 2 years when the RCC structure is expected to be completed


SEED TRANSACTION (CONTD)

Late Stage Investment

Site Progress


KEY FUND TERMS

Target Size INR 350 Cr (+ INR 350 Cr Greenshoe option)

Type Category II AIF

Sponsor Commitment At least 7.5% of basic fund size

Term Five years from date of Initial Closing; with an option to extend if and as required only with super majority consent

Investment Period Two years from date of Initial Closing; with an option to extend for 1 year

Target Hold Period 2-5 years per investment

Target Returns 26.0%+ IRR

Setup Fee Up to 2.00% of capital committed

Management Fee 1.5% p.a. on capital drawn

Performance Fee 20% over a 10% hurdle

Catch Up None

Reinvestment None

Target Cities Tier 1 only (Mumbai, NCR, Bangalore, Pune and Chennai)


PIRAMAL FUND MANAGEMENT

02


Best positioned in Indian real estate financing sector with ability to meet funding requirements across project life cycle

Well established fiduciary track record in real estate private equity space Strong real estate debt underwriting capabilities Amongst the first and few Indian players to complete full cycle of

raising, deployment, exits and distributions from the projects

Managing INR 7,554 Cr at present across 7 funds/JVs and 3 thirdparty mandates

Invested in 33 projects across 6 cities with 15 leading developers

Exited 17 investments till date returning c. INR 1,487 Cr(1)

Trusted by leading global investors such as CPPIB and 3i

Created significant value across portfolios managed for Trinity andF&C REIT

Successfully deploying Piramal Enterprises fund in real estate andallied sectors with an objective of achieving attractive risk adjustedreturns

In-house capabilities of underwriting real estate debt investmentsacross risk spectrum ranging from senior secured lending tostructured debt

Disbursed c. INR 2,925 Cr till date across 50 investments withexpected returns of c. 18%

Repayment of c. 34% of disbursements (INR 989 Cr) testifystrong debt underwriting skill set

Particulars Unit Domestic Offshore Third Party Total

Funds # 5 2 3 10

AUM INR Cr 3,403 2,350 1,801 7,554

Investments # 29 6 12 32

Investments INR Cr 2,165 727 1,315 3,141

Exits # 10 3 6 17

Exits INR Cr 695 533 259 1,487

Particulars Units Real Estate Education Total

Investments # 39 11 50

Sanction INR Cr 2,655 486 3,141

Disbursement INR Cr 2,455 470 2,925

Outsanding INR Cr 1,568 368 1,936

Expected returns % 18.2% 15.2% 17.7%

Repayments INR Cr 887 102 989

1) Including partial and term sheeted exits

Equi

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equ

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expe

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Senior debt and construction funding

Preferred partner for developers and investors

alike with integrated

capabilities

Capable of catering to entire capital stack of real estate sector ranging from vanilla equity and structured investments to senior secured debt and construction funding

Integrated platform provides unparalleled skill sets, sector experience and industry relationships, strengthening platforms ability of delivering superior risk adjustedreturns for investors and sponsors

PIRAMAL FUND MANAGEMENTONE OF THE LARGEST RE PE PLATFORMS


Seasoned professionals with strong operational and underwriting experience in Indian real estate

ON-THE-GROUND PRESENCEFOCUS AND EMPHASIS ON LOCAL ORIGINATION AND MONITORING

Khushru JijinaManaging Director

Arvind PahwaExecutive Director

Sunil AdukiaVice President

Ankur MaheshwariAssociate Principal

Arvind SharmaManager

CV RamaniExecutive

Geetika RajputExecutive

Financial Control

Piyush GuptaPrincipal

Sumit SuriAssociate Principal

Divya TikiyaAssociate Principal

Deval ValiaInvestment Manager

Ashok PanickerAssociate Investment Manager

Mumbai /Thane/Redevelopment

Khodadad PavriPrincipal

Abhishek MundhraAssociate Principal

Amit UpadhyayInvestment Manager

Virag ShahAssociate Investment Manager

ChennaiBangalore

Investment & Asset Management Funds

Hitesh DhankaniPrincipal

Dinesh AjwaniAssociate Principal

Ankush AhujaAssociate PrincipalDevendra KhilariAssociate Principal

Nihar ShahSenior Associate

Garima BhatnagarAssociate

Investor Relations

Mukul SinghAssociate Principal

Gaytri UdeshiSr.Client Relationship Manager

Ravi Kumar GuptaSr.Client Relationship Manager

Rohit PatankarAssociate

Swapna DinakarAssociate

Geeta JabiAssociate

Sudha RaviExecutive Director

Pune

NCR

Manoj RajanPrincipal

Rujita ReleAssociate Principal

Keshav JainInvestment Manager

Zubair JiwaniInvestment Manager

Dhruv AhujaAssociate Principal

Raghav VijAssociate Principal

Navin DhanukaPrincipal

Santosh SoniPrincipal

Saurabh VikheAssociate Principal

Amit ShuklaInvestment Manager

Vaibhav SaxenaAssociate Investment Manager

Krishna KumarPrincipal

Pawan BommireddipalliInvestment Manager

Kumaran ChandrasekaranAssociate Investment Manager

Legal / Compliance

Anand VardhanVice President

Pooja GaonkarAssociate Principal

Suprio BoseAssociate Principal

Sheryl JacquesChief Manager

HR/Admin

Sachin DeodharCFO

Vaibhav RekhiPartner

Amit DiwanPartner

Pawan SawhneyPartner


....with decades of cumulative experience across real estate, financial services and investment advisory

STRONG INVESTMENT COMMITTEE

Ajay Piramal

Mr. Ajay Piramal is the Chairman of the Piramal Group, a diversified conglomerate with business interests across pharmaceuticals, packaging,financial services and real estate. He is also the Chairman of Pratham, which is the largest non-governmental organisation in the education sector. Mr.Piramal serves on the Indian Prime Ministers Task Force on Pharmaceuticals & Knowledge-Based Industries and Council for Trade & Industry. He isa member of the Government of Indias Board of Trade. Mr. Piramal completed his Masters in Management Studies from Jamnalal Bajaj Institute ofManagement Studies, and completed his Advanced Management Programme from Harvard Business School in 1992. Today, he serves as a memberon the Board of Deans Advisors at Harvard Business School.

Khushru Jijina Mr. Jijina has an illustrious career spanning over 2 decades in the field of real estate, corporate finance and treasury management and has been with

the Piramal Group for around 12 years. He was a key member of the founding team of INDIAREIT in 2006. He was the Executive Director in PiramalSunteck Realty, where he was responsible for a portfolio of projects spanning Mumbai, Navi Mumbai, Nagpur, Jaipur and Oman and oversaw allaspects of their execution. Mr. Jijina is a Chartered Accountant.

Shitin Desai Mr. Desai is Executive Vice Chairman of DSP Merrill Lynch, and is one of its founding Directors. He was a member of the Committee on Takeovers

appointed by SEBI and was a Member of: RBI Capital Markets Committee, Advisory Group for Securities Market of RBI and Insider TradingCommittee of SEBI.

Rajesh Khanna Mr. Rajesh Khanna is the founder & CEO of Arka Capital Advisors Pvt. Ltd. Previously, he served as a Managing Director and India Head of Warburg

Pincus, a global private equity firm, and was a member of its global Executive Management Group. Mr. Khanna is a Director of Lemon Tree Hotels,Max India and Max Life Insurance Company. Prior to joining Warburg Pincus, he worked with Citibank N.A. and Arthur Andersen & Co. He receivedan MBA from the Indian Institute of Management, Ahmedabad, and is a Chartered Accountant.

Tara Subramaniam Tara is the Chief Operating Officer at JM Financial Products Ltd. Previously, she was a Director with the Sun Group. Earlier, Tara was a part of HDFCLimited as Deputy General Manager, Commercial Real Estate where she was a part of a team formulating funding and underwriting strategies.

R.A. Shah Mr. Shah is a solicitor and senior partner at M/s Crawford Bayley & Co. Mr. Shah is also a Member of the Managing Committee of Bombay Chamberof Commerce, Indo German Chamber of Commerce and president of Society of Indian Law Firms.

Ashish Dalal Mr. Dalal has till recently been a partner of Dalal & Shah, Chartered Accountants and has also been a partner of Price Waterhouse & Co. He has also

held directorships in Wyeth Limited, Akzo Nobel Chemicals (India) Ltd., ICICI Investment Management Co. Ltd., Financial Technologies (India) Ltd.And Multi Commodity Exchange of India Ltd.

Niraj Bhukhanwala Mr. Bhukhanwala is a Director of Bhukhanwala Holdings Private Limited. A closely held boutique investment company. He was earlier a part of the

team that setup Intels venture capital operations in India. Prior to Intel, he has worked with Mckinsey and Company in London focusing on panEuropean strategies in the telecom and enterprises sector. Mr. Bhukhanwala is a MBA from INSEAD, France.


....be it exits from vintage funds, new funds raising and deployment being done across funds

Steady progress and investment momentum Truly aligned sponsor:

Piramal Enterprise committed to invest 7.5%across all funds vis--vis market practice ofsponsor commitments of 2% - 5%

Exits prioritized over new fund raise:Indiareit management focussed on valuecreation for investors rather than increasingAUM

Fund deployment capabilities:Strong flow of attractive deals including dealsfrom exiting developer partners assurestimely fund deployment (e.g. 25% ofDomestic Fund V committed within twomonths of final close)

Ability to deliver optimal risk adjustedreturns:Focus on structured deals assures optimalrisk adjusted returns and facilitates fasterexits

DELIVERING ACROSS ALL METRICS

(1): Includes term sheeted exits

Sep 2012

Khushru Jijina re-joined as Managing Director

Dec 2012

Announced exits worth INR 1000 Cr from vintage fund investments(1)

Aug 2013

Closed Mumbai Redevelopment Fund, raising INR 500 Cr

Jan 2014

Mandated as Advisor to IIFLs INR 750 Cr Income Opportunities Fund Special Situations

Feb 2014

Appointed as advisor to PEL CPPIBs US$ 500 Mn residential debt alliance

Dec 2013

Final close of Domestic Fund V at INR 1000 Cr including greenshoe option


Indiareit stands out Preferred Source of Capital for Indian developersDeployed INR 1,074 Cr in ten investments across four equity funds in last 18 months

Investment evaluation activity in last 12 months across equity funds

UNPARALLELED INVESTMENT MOMENTUM

Date Project Location Fund IV (INR Cr) MRF (INR Cr) Fund V (INR Cr) IIFL Managed Account (INR Cr) Total (INR Cr) Target IRR (1)

Feb-13 Marvel Pune 100 - - - 100 24%

Feb-13 Omkar Crescent Bay Mumbai - 100 - - 100 24%

May-13 Ariisto TDR Mumbai 75 125 - - 200 26%

May-13 Ashiana Gurgaon (NCR) - - 100 - 100 26%

Oct-13 Omkar Ghatkopar Mumbai - 125 - - 125 27%

Dec-13 Valmark Bangalore - - 90 - 90 26%

Dec-13 Arkade Mumbai - - 60 - 60 24%

Feb-14 Satya Gurgaon (NCR) - - - 99 99 22.5%

April-14 Marvel II Pune - - - 150 150 23%

Total 175 350 250 249 1,024

75 30 10

Deals ReviewedDeals progressed for further due

diligenceDeals approved after detailed

due diligence

In addition to the above, Piramal Fund Management has also committed INR 1950 Cr across 38 investments as part of proprietary loan book

Unparalleled deal access is complemented by rigorous investment selection process

(1): Target IRRs mentioned are as per underwriting; there can be no assurance, representation or guarantee that the objectives of the fund will be achieved


This presentation is made for informational purposes only and should not be regarded as an opinion, legal or otherwise, of any kind or a recommendation. It does notconstitute an offer, solicitation or an invitation to the public in general to invest in the AIF.

The purpose of this document is to provide general information to prospective investors to assist them in making investment decision. It does not purport to contain all the information that theprospective investor may require. This presentation is interned for the use of prospective investors only to whom it is addressed and who is willing and eligible to invest in the Fund.

The information contained in this presentation is obtained from sources believed to be reliable. We do not represent that any information, including any third party information, is accurate orcomplete and it should not be relied upon without proper investigation on the part of the investors. The investment manager or any of its directors, principal officers/employees do not giveany assurance/guarantee for any accuracy of any of the facts/interpretations in this presentation, and shall not be liable to any person including the beneficiary for any claim or demand fordamages or otherwise in relation to this opinion or its contents. The aimed returns mentioned anywhere in this document are purely indicative and are not promised or guaranteed in anymanner. Returns are dependent on prevalent market factors, liquidity and credit conditions. Instrument returns depicted are in the current context and may be significantly different in thefuture. There is no guarantee that aimed returns may be met. All aimed returns are on a pre-tax basis unless specifically mentioned. This presentation may contain certain forward lookingstatements which are merely indicative and should not be treated as representations. Due to various risks and uncertainties, actual events or results or the actual performance of the Fundmay differ materially from those reflected or contemplated in such forward-looking statements.

There can be no guarantee that the position regarding taxation of the Fund and taxation of investors of the Fund would be necessarily accepted by the income-tax authorities under theIndian Income Tax Act, 1961. No representation is made either by the investment manager/trustee/advisor or any of their employee, director, shareholder or agent, in regard to theacceptability or otherwise of the above position regarding taxation of the Fund and taxation of the investors of the Fund by the income tax authorities under the ITA.

The contents of this presentation should not be treated as advice relating to investment, legal or taxation matters. It is recommended that, prospective investors consult their stockbroker,banker, legal adviser and other professional advisers to understand the contents of this presentation. This presentation is qualified in its entirety by the Private Placement Memorandum andother related documents, copies of which will be provided to prospective investors. The Fund shall not accept investments from any person without receiving necessary regulatory approvals.

Each prospective investor is hereby invited to meet with and/or to ask questions to the representatives of the investment manager concerning the terms and conditions of making investmentand to request any additional information, which such representatives possess or can acquire without unreasonable effort or expense. All investors must read the detailed Private PlacementMemorandum including the Risk Factors therein before making any investment decision/contribution to AIF.

Capitalized terms used herein shall have the meaning assigned to such terms in the Private Placement Memorandum and other documents.

The prospective investors are requested to read the Private Placement Memorandum and the Investment Agreement/Contribution Agreement of the Fund before Investing.

DISCLAIMER

indiareit apartment fund

Documents

market fund strategy

fund tenure

market deals

party developer

established development

inr1 cr

developer partners

deployed inr