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Presentation
June 2014
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risks and uncertainties, regarding fluctuations in earnings, our ability to manage growth, competition, our ability to manage our international operations, government policies,
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Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, as amended, or any other applicable law.
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Investor Presentation, 2014
KSK Group – an overview
KSK Power Ventur plc (“KSK plc”)
KSK Energy Ventures
Limited (“KSKEV”)
Arasmeta (86 MW)
100 % Sai Regency (77 MW)
100 %
KSK Energy Limited, KSK Green Energy Pte Sitapuram (43 MW)
Mauritius Limited, Singapore VS Lignite (135 MW)
Wardha (540 MW)
67.60%* 100 % 100 %
Sai Maithili (10 MW)
KSK Energy Ventures KSK Energy Project
Limited (“KSKEV”) Company (“KECPL”) companies KSK Mahanadi
(3.6 GW)
• Operating 1472 MW • Railway and water • Wind
• 6 SPVS 872 MW transportation
• Solar
infrastructure
• KSK Mahanadi 600 MW Operational
.
• Under Construction 3000 • Coal block mine
. Under Construction – partially
MW of which II unit of 600 development operational
MW expected to be support
commissioned by
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Investor Presentation, 2014
Background
• Two Listed entities
• KSK Power Ventur plc – LSE Listed main holding Company
• KSK Energy Ventures Limited – Indian stock exchanges listed generation holding company
• Founded by KA Sastry and S Kishore, first generation entrepreneurs with extensive energy
sector consulting experience prior to business setup
• KSK amongst the few developers in India with extensive project footprint across the country -
Chhattisgarh, Maharashtra, Rajasthan, Tamil Nadu, Andhra Pradesh
• Valued relationship with Industrial consumers, State Mineral Development Corporations and
power utilities across states
• Access to project debt from major Indian project lending institutions and recent availability of
External Commercial Borrowing
• Experienced Board led by Padma Bhushan Sri T.L.Sankar, Non Executive Chairman who is a
distinguished energy expert of India
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Investor Presentation, 2014
KSK Power Ventur plc - The Board
Non Executive Chairman Executive Directors Non-executive Directors
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Investor Presentation, 2014
KSK Energy Ventures - The Board
Non Executive Chairman Executive Directors Non-executive Directors
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Investor Presentation, 2014
Power Sector – The Growth Canvas
862 937 998 1,002 • Energy demand growth closely
Robust Demand
777 831
linked to GDP growth
• Pick-up in domestic economy
Growth
• Notwithstanding sustained
Robust Demand
13,394 Consumption
(kWh/Year) demand, India continues to be
10,286
among the lowest per capita
Growth
9.8% 10.6%
9.0%
demand narrowed gap
11.1%
10.1% 4.5% – -4.2% energy deficit in FY14
8.5% 8.5% 8.7%
(~42Twh)
4.2% – -4.5% peak deficit in FY14
(~6 GW)
FY09 FY10 FY11 FY12 FY13 FY14
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Investor Presentation, 2014
The Government got into action
Prime Ministers Government issues Government issues
CERC revises pre -
office meets power Presidential Second Presidential
determined tariff PPAs
sector Directive to Coal Directive to Coal India
for 2 projects
Management for India to sign FSAs Limited
review of problems CERC issues final tariff
FSA to provide 80% Fuel Supply Agreement
norms for 2014-19;
Decides to form a supply to 60 GW list expanded to 78 GW
tightens norms, lowers
committee for time- capacity including tapering
RoE
bound action linkages
Jan -12 Apr -12 Jan-13 Apr -13 Jun -13 Jul -13 Feb-14
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Investor Presentation, 2014
KSK – Key Milestones
Year Milestone
2014 KSK Mahanadi – PPA with UP DISCOMS for 1000 MW power supplies
KSK Mahanadi executed Fuel Supply Agreement for Tapering Coal Linkage
2013 KSK Mahanadi – PPA with Tamil Nadu Utility - 500 MW, Chhattisgarh – 225 MW
First 600 MW Unit of KSK Mahanadi operational and power supplies commenced
New Initiatives on Solar Power Generation
2012 KSK Mahanadi – PPA with AP DISCOMS for 400 MW power supplies
Wardha Power - Open Access for supplies to Industrial consumers and Fuel Supply Agreement with Western Coal Fields Limited
2011 Wardha Power fully operational –supplies to Reliance-infra Discom commences
KSK plc completes an Open Offer to acquire additional 20% of Indian listed subsidiary, KSK Energy Ventures Limited –
shareholding goes upto 74.94%
Arasmeta Expansion unit of 43 MW commences power generation
2010 KSK Mahanadi – PPA with GUVNL for 1010 MW of Power supplies
VS Lignite power plant commissioned
2009 Coal supply agreement entered with GIDC for proposed 1800 MW Power project in Chhattisgarh, KSK Mahanadi capacity
enhanced to 3600 MW
Implementation Agreement signed with Government of Chhattisgarh for KSK Mahanadi project
2008 KSK Energy Ventures Initial public offering of Shares, raising approx US$ 290 mn, KSK Power Ventur plc stake at 55.25%.
2007 Sai Regency power plant synchronized with the grid
2006 Arasmeta power plant synchronized with the grid
Collaborative MOU’s with Government mining companies for long term coal supply arrangements signed - Execution of a coal
supply and investment agreement with GMDC for supplies to proposed 1800 MW Chhattisgarh project
KSK Power Ventur plc lists on AIM Market of London Stock Exchange
GMDC – Gujarat Mineral development Commission, GIDC – Goa Industrial Development Corporation, GUVNL – Gujarat Urja Vikas Nigam Limited
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Investor Presentation, 2014
KSK – Business Strategy and Response
Secure Fuel Access – • Arasmeta and Sitapuram - Coal linkages from SECL /SCCL
attempts for sustained • Sai Regency – Natural Gas from GAIL (India) Limited
generation • VS Lignite - captive lignite block
• Sai Wardha Power – Linkage with Western Coal Fields on cost plus basis
• KSK Mahanadi - Collaboration with State Mineral Development Corporations
for dedicated coal block supplies
– Tapering coal linkage from CIL subsidiaries in the interim period
Power purchase • New PPA signed by KSK Mahanadi with TANGEDCO for 500 MW and UPPCL
Agreements for 1000MW
• Industrial supply PPAs under captive consumer model
• Wardha Warora - challenges of open access and alternative PPA tie-ups
being addressed
Enabling Support • Power generation de-licensed but support sectors continue under
Infrastructure government control and limited pace of progress
• At KSK Mahanadi - supplement generation initiatives of KSK Energy Ventures
Limited with pursuit of necessary utilities of railway, water and transport
infrastructure through SPVs under KSK Energy Company
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Investor Presentation, 2014
KSK Mahanadi (3600 MW) – Brief Overview
KSK Mahanadi, (Chattisgarh) - 3600 MW
consists of 6 units, each of 600 MW.
Fuel Progress
• Morga-II Forest clearance for prospecting achieved
• Gare Pelma Stage II forest clearance obtained and mining to commence
• Tapering Linkage Fuel Supply Agreement
USD/INR Depreciation
• Depreciation of the INR against the USD affecting equipment supplies cost at INR
level - balance four units necessitating enhanced debt
• External Commercial Borrowing (ECB) being pursued to substitute part of the INR
Project Finance Debt
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Investor Presentation, 2014
KSK Mahanadi – EPC Approach
#9
#7 #8
#1 #2 #3 #4 #5 #6
“Differentiated EPC String Approach” – the core units (i.e. #3, #4) are commissioned first and then
the other units are taken up for commissioning thereafter. This also necessitates setup and
construction of common infrastructure for each three units block ( # 7 and #8) as well as for all the
six units ( #9).
This approach though entails significant initial capital expenditure, ensures easier and faster access
to materials & common infrastructure setup at the construction site
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Investor Presentation, 2014
KSK Mahanadi – Fuel Access
Morga II coal
block
Gare Pelma - III Independent coal collaboration and mine development initiatives including
coal block procurement of imported coal in interim
KSK Mahanadi
Power Plant
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Investor Presentation, 2014
KSK Mahanadi – PPA Approach
Morga II based Supply PPA
Gujarat
1010 MW
*PPA to be executed shortly – tariff under Central Electricity Regulatory Commission mechanism
** supplies between 2013 to 2016
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Investor Presentation, 2014
Wardha Power – 540 MW
Wardha Warora, (Maharashtra) - 540 MW | Coal
Generation
2011-12 PLF: 60 %
2012-13 PLF: 72 %
2013-14 PLF: 55 %
PPA arrangements
• Long term source – cost plus coal block linkage from Western Coalfields Limited – FSA for
1.625 MTPA as against Linkage quantity of 2.26 MTPA
• Price, quality and other conditions before Competition Commission of India
• Interim open market / imported coal
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Investor Presentation, 2014
VS Lignite – 135 MW & Sai Maithili – 10 MW
VS Lignite (Rajasthan) – 135 MW | Lignite
2010-11 PLF: 63 %
2011-12 PLF: 78%
2012-13 PLF: 75%
2013-14 PLF: 76%
• Sai Maithili Solar unit of 10 MW under Jawaharlal Nehru National Solar Mission
• Initial Funding by IDBI Bank Limited, US Exim Funding tied up – RBI approval under pursuit
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Investor Presentation, 2014
Arasmeta – 86 MW
Arasmeta (Chattisgarh) - 86 MW (2 x 43 MW) | Coal
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Investor Presentation, 2014
Sai Regency – 58 MW, Sitapuram Power – 43 MW
Sai Regency Power (Tamil Nadu) - 58MW Natural gas
CCGT asset In operation since 2007
2009-10 PLF: 71 %
2010-11 PLF: 87 %
2011-12 PLF: 89 %
2012-13 PLF: 84 %
2013-14 PLF: 88%
2009-10 PLF: 86 %
2010-11 PLF: 77 %
2011-12 PLF: 68 %
2012-13 PLF: 89 %
2013-14 PLF: 91%
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Investor Presentation, 2014
Operation Performance of Power Project Portfolio
4.33
4.57 4.63
6000 5757 5
4.09 5546
3.89 5103
3.54 4862 4916
4
4500 4306
3
3000 2793
2512
2
1500 1010
958 862 905 1
0 0
FY09 FY10 FY11 FY12 FY13 FY14
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Investor Presentation, 2014
KSK Energy Company – Support Infrastructure
KSK Mineral
Resources Private Raigarh Champa Rail Infrastructure
Limited • Rail connectivity and transportation
KSK Mahanadi Power infrastructure between Coal blocks and
Contractual agreements
Company Limited Raigarh Champa KSK Mahanadi power plant
(3.6 GW) Rail Infrastructure
Private Limited KSK Water Infrastructure
• Water transportation and storage
infrastructure between Mahanadi river
KSK Water and KSK Mahanadi power plant
Infrastructure
Private Limited KSK Mineral Resources
• Development support of Gare-Pelma coal
block of GIDC
*Balance 32.4 % held by various public shareholders at BSE/NSE listed KSKEV
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Investor Presentation, 2014
KSK Water Infrastructure
Line I – 23.29 km
• River intake at Basantpur to common pipeline Junction Pipeline
• Entire 60 km pipeline laying work completed
Line II – 1.1 km and currently used for water transport
• River intake at Seorinarayan to common water pipeline
junction
Intermediate Reservoir
Line III – 22.53 km • Water storage reservoir with 7 MCM
• Common water pipeline junction to intermediate reservoir capacity and spread over 270 acres of land
mid way between river and power project
Line IV – 14.02 km under progress
• Intermediate reservoir to power plant
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Investor Presentation, 2014
Raigarh Champa – rail connection for fuel supplies
• Incorporation: May 2009 for coal
transportation facilities from mines to power
project
• Nature of activities: Land acquisition,
construction of rail lines, loading and unloading
facilities , shunting locomotive along with safety
and signaling infrastructure
• Construction: Raigarh Champa with
subcontractors
• Revenue Model: Cost plus
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Investor Presentation, 2014
KSK Mineral Resources
● GIDC was allotted the coal block in November 2008 with Geological Reserves of 210 MT
● Mine plan approval was obtained in May 2010 , forest clearance from Ministry of Environment & Forest (Stage I)
obtained in April 2011 and stage II in early 2013
● Mining Contractor appointment notified and Lease anticipated to be executed shortly by GIDC
● KSK Mineral facilitating GIDC in coal block development - coal production commencement anticipated in the short term
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Investor Presentation, 2014
Sustainability Initiatives
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Investor Presentation, 2014
Thank you
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Investor Presentation, 2014