INDIAREIT APARTMENT FUND

PIRAMAL FUND MANAGEMENT PVT LTD

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CONTENTS
1 INDIAREIT APARTMENT FUND : STRATEGY & OVERVIEW
2 PIRAMAL FUND MANAGEMENT : CREDENTIALS & CAPABILITIES

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EXECUTIVE SUMMARY

Strong sponsor: Piramal Fund Management provides capital across the risk spectrum, providing Indiareit access to attractive off market deals:

Competitive
Advantages

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 estate
development background and an established development team. Consequently, it possesses capabilities of taking over projects from developers to
ensure 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

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 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)

Fund Strategy

Fund Structure

Target Gross Equity IRRs of 26%+

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01
INDIAREIT APARTMENT FUND

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CURRENT MARKET SCENARIO

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

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

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FUND OVERVIEW
Creates win-win for all stakeholders i.e. developer and investors
To acquire residential apartments in Tier 1 Markets at a significant discount to the market, by offering a
bulk purchase of residential units, to the developer
FUND THEME

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

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

INVESTOR
RATIONALE

Ability to get value deals by committing to a bulk purchase; ability to leverage existing relationships with
development 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 individual
transaction
Quicker realization of attractive risk adjusted returns vis a vis retail participation at prevailing market price

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INVESTMENT MATRIX
A combination of structured / downside protected and upside only transactions

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

PRE LAUNCH STAGE

LAST MILE FUNDING

Structured Investments or Upside Only

Investments either with a minimum guaranteed return
with sharing of the upside or entirely upside driven

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

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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

Robust process to benefit from Piramal Groups sourcing and evaluation capabilities
Steps

1 Deal sourcing
2 Deal evaluation
3 Investment decision
4 Investment management

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Brief overview

Source investment opportunities through strong network and local relationships; opportunities to abide
with investment guidelines established for the platform

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

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

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

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SEED TRANSACTION
RESIDENTIAL PROJECT IN MUMBAI
Investment 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 payable
immediately 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 underwritten

Tenure

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

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 collected
in the next 2 years when the RCC structure is expected to be completed

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

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SEED TRANSACTION (CONTD)

Late Stage Investment

Site Progress

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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)

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02
PIRAMAL FUND MANAGEMENT

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PIRAMAL FUND MANAGEMENT

ONE OF THE LARGEST RE PE PLATFORMS
Best positioned in Indian real estate financing sector with ability to meet funding requirements across
project life cycle

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 adjusted
returns for investors and sponsors

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

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

party 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 and

Equity and structured equity

expertise

Preferred partner
for developers
and investors
alike with
integrated
capabilities

Senior debt and construction

funding

raising, deployment, exits and distributions from the projects

Successfully deploying Piramal Enterprises fund in real estate and

allied sectors with an objective of achieving attractive risk adjusted
returns

In-house capabilities of underwriting real estate debt investments

across risk spectrum ranging from senior secured lending to
structured debt

Disbursed c. INR 2,925 Cr till date across 50 investments with

expected returns of c. 18%

strong debt underwriting skill set

F&C REIT
Particulars

Repayment of c. 34% of disbursements (INR 989 Cr) testify

Unit

Domestic

Offshore

Third Party

Total

Particulars

Units

Real Estate

Education

Total

Funds

10

Investments

39

11

50

AUM

INR Cr

3,403

2,350

1,801

7,554

Sanction

INR Cr

2,655

486

3,141

Investments

29

12

32

Disbursement

INR Cr

2,455

470

2,925

Investments

INR Cr

2,165

727

1,315

3,141

Outsanding

INR Cr

1,568

368

1,936

Exits

10

17

18.2%

15.2%

17.7%

Exits

INR Cr

695

533

259

1,487

INR Cr

887

102

989

1)

Expected returns
Repayments

Including partial and term sheeted exits

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ON-THE-GROUND PRESENCE
FOCUS AND EMPHASIS ON LOCAL ORIGINATION AND MONITORING
Seasoned professionals with strong operational and underwriting experience in Indian real estate
Khushru Jijina
Managing Director
Arvind Pahwa
Executive Director
Sachin Deodhar
CFO

Amit Diwan
Partner

Financial Control
Sunil Adukia
Vice President
Ankur Maheshwari
Associate Principal
Arvind Sharma
Manager
CV Ramani
Executive
Geetika Rajput
Executive

Legal / Compliance

Anand Vardhan
Vice President
Pooja Gaonkar
Associate Principal
Suprio Bose
Associate Principal
HR/Admin
Sheryl Jacques
Chief Manager
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Sudha Ravi
Executive Director
Pawan Sawhney
Partner

Vaibhav Rekhi
Partner

Investment & Asset Management

Mumbai /Thane/Redevelopment
Piyush Gupta
Principal
Sumit Suri
Associate Principal
Divya Tikiya
Associate Principal
Deval Valia
Investment Manager
Ashok Panicker
Associate Investment Manager

Manoj Rajan
Principal
Rujita Rele
Associate Principal
Keshav Jain
Investment Manager
Zubair Jiwani
Investment Manager

Bangalore

Chennai

Navin Dhanuka
Principal
Santosh Soni
Principal
Saurabh Vikhe
Associate Principal
Amit Shukla
Investment Manager
Vaibhav Saxena
Associate Investment Manager

Funds
Pune
Khodadad Pavri
Principal
Abhishek Mundhra
Associate Principal
Amit Upadhyay
Investment Manager
Virag Shah
Associate Investment Manager

Hitesh Dhankani
Principal
Dinesh Ajwani
Associate Principal
Ankush Ahuja
Associate Principal
Devendra Khilari
Associate Principal
Nihar Shah
Senior Associate
Garima Bhatnagar
Associate
Investor Relations

Krishna Kumar
Principal
Pawan Bommireddipalli
Investment Manager
Kumaran Chandrasekaran
Associate Investment Manager

NCR
Dhruv Ahuja
Associate Principal
Raghav Vij
Associate Principal

Mukul Singh
Associate Principal
Gaytri Udeshi
Sr.Client Relationship Manager
Ravi Kumar Gupta
Sr.Client Relationship Manager
Rohit Patankar
Associate
Swapna Dinakar
Associate
Geeta Jabi
Associate
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STRONG INVESTMENT COMMITTEE

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

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 is
a member of the Government of Indias Board of Trade. Mr. Piramal completed his Masters in Management Studies from Jamnalal Bajaj Institute of
Management Studies, and completed his Advanced Management Programme from Harvard Business School in 1992. Today, he serves as a member
on the Board of Deans Advisors at Harvard Business School.

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 Piramal
Sunteck Realty, where he was responsible for a portfolio of projects spanning Mumbai, Navi Mumbai, Nagpur, Jaipur and Oman and oversaw all
aspects of their execution. Mr. Jijina is a Chartered Accountant.

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 Trading
Committee of SEBI.

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 received
an MBA from the Indian Institute of Management, Ahmedabad, and is a Chartered Accountant.

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 HDFC
Limited as Deputy General Manager, Commercial Real Estate where she was a part of a team formulating funding and underwriting strategies.

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 Chamber
of Commerce, Indo German Chamber of Commerce and president of Society of Indian Law Firms.

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.

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 pan
European strategies in the telecom and enterprises sector. Mr. Bhukhanwala is a MBA from INSEAD, France.

Ajay Piramal

Khushru Jijina

Shitin Desai

Rajesh Khanna

Tara Subramaniam
R.A. Shah

Ashish Dalal

Niraj Bhukhanwala

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DELIVERING ACROSS ALL METRICS

....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 of
sponsor commitments of 2% - 5%

Khushru Jijina
re-joined as
Managing
Director

Dec 2012

Dec 2013

Feb 2014

Fund deployment capabilities:

Strong flow of attractive deals including deals
from exiting developer partners assures
timely fund deployment (e.g. 25% of
Domestic Fund V committed within two
months of final close)

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

Exits prioritized over new fund raise:

Indiareit management focussed on value
creation for investors rather than increasing
AUM

Closed Mumbai
Redevelopment
Fund, raising
INR 500 Cr

Ability to deliver optimal risk adjusted

returns:

Sep 2012

Aug 2013
Announced exits
worth INR 1000
Cr from vintage
fund
investments(1)

Jan 2014
Final close of
Domestic Fund V
at INR 1000 Cr
including
greenshoe option

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

Focus on structured deals assures optimal

risk adjusted returns and facilitates faster
exits

(1): Includes term sheeted exits

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UNPARALLELED INVESTMENT MOMENTUM

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

Project

Location

Fund IV (INR Cr)

MRF (INR Cr)

Fund V (INR Cr)

IIFL Managed Account (INR Cr)

Total (INR Cr)

Feb-13

Marvel

Pune

Feb-13

Omkar Crescent Bay

May-13

100

100

24%

Mumbai

100

100

24%

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%

175

350

250

249

1,024

Total

Target IRR

(1)

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

Investment evaluation activity in last 12 months across equity funds

75

30

10

Deals Reviewed

Deals progressed for further due

diligence

Deals approved after detailed

due diligence

(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

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DISCLAIMER
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 not
constitute 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 the
prospective 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 or
complete 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 give
any 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 for
damages 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 any
manner. 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 the
future. 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 looking
statements 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 Fund
may 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 the
Indian 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 the
acceptability 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 and
other 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 investment
and to request any additional information, which such representatives possess or can acquire without unreasonable effort or expense. All investors must read the detailed Private Placement
Memorandum 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.

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