IB_IPO

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© 2010 ARC Financial Services (P) Ltd. All rights reserved. Privileged and confidential information of ARC Financial Services www.arc-fs.com | 0

Strategies for your SuccessARC

Market – Global and India

A Comprehensive Assessment (Q1 March 2010)


Winds of change…Halcyon days back again!!

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864 1,517 1,537 1,537 1,729 1,979 745 577 267

50

124

167 167

246

287

94111

53

-

500

1,000

1,500

2,000

2,500

2003 2004 2005 2005 2006 2007 2008 2009 Q1 Mar'10

0255075100125150175200225250275300

No. of IPO's Proceeds ($B)

Global IPO Market: Q1 Mar’10 Synopsis

Global IPO Activity

The IPO market which started to recover in the second half of 2009, continued its recovery trend in Q1 Mar’10

Driven by Asian and European market, Q1 Mar’10 witnessed the highest first quarter activity since 2000 (in terms ofnumber of deals and capital raised)

Asian markets witnessed 62% of total IPO volume in Q1 Mar’10

Asia Pacific continued to be the leading region with 66% market share. EMEA and North America regions had 19% and13% market share respectively

IPO activity by number of IPOs grew by 413% YoY in Q1 Mar’10 to 267 deals compared to 52 deals in Q1Mar’09), though it declinedby 10% QoQ from 297 deals in Q4 Dec’09

In terms of deal proceeds, IPO proceeds increased by a huge 3,700% in Q1 Mar’10 to $53.2B from $1.4B in Q1Mar’09, though they declined by 21% QoQ from $67.2B in Q4 Dec’09

Emerging markets dominated the IPO market in Q1 Mar’10 Developing countries made up to 72% of the total number of deals, whereas developed countries made 28%

Developing countries raised 58% of the total proceeds compared to 42% from developedeconomies

BRIC (Brazil, Russia, India and China) countries’ IPO activity, constituted 49% of global capital raised in Q1 Mar’10

– Seven of the top 10 IPOs and 13 of the top 20 IPOs by proceeds were from emergingmarkets

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4

713

26 2733

27

37

29

37

33

68

34

62

45

105

36

90

59

102

41

38

133 1

10

33

66

53

Global IPO Market Quarterly Performance..

171

130

226

337 339386

337

455

333

403

347

454

344

458

342

585

381

567

440

591

251

269

164

78 52 82

146

297 267

IPO activities nosedivedduring this phase

Over last 7 years, Global IPO market witnessed highest number of deals in Q4 Dec’07 and highest proceeds in Q4 Dec’06

IPO Proceeds ($B)

IPO Volume

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1 23

7

4

6

3 4 4

7

4

15

7

1818

43

13

36

28

43

13 11

3

1 0

7

23

35

26

Over the last 7 years, the emerging countries market has increased from a fourth of the total global IPO proceeds to nearly h alf

..Has Seen Spurt By The Emerging Countries

19

23

33 34 37

70

35

33

22

39

28

57

60

48

60

111

91 91

122 126

47

72

377 6

12

57

124135

IPO Proceeds ($B)

IPO Volume

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***includes automobiles and components; building/construction and engineering; construction materials; machinery and other industrials; transportation and infrastructure ****includes chemicals; construction materials; containers and packaging; metals, mining and other materials; paper and forest products

Sector-Wise Global IPO Roulette..

Industrials*** 17%

Materials**** 13%

Technology 13%

Healthcare 12%

ConsumerProducts &

Services 11%

Consumer

Staples 8%Energy &Power

6% Financials6%

Retail 6%

Media &Entertainment

4%

Telecom 4%

Sector Breakup: Q1 Mar’09 Sector Breakup: Q1 Mar’10

In Q1 Mar’10, Materials was the leading sector witnessing 53 IPOs followed by Industrials with 51 and Technology with38

All three sectors collectively accounted for 53% of total IPO deals

In Q1 Mar’09, Industrials sector was the leading sector witnessing only 9 IPOs followed by Materials and Technology with7 IPOs each

Real Estate sector which remained silent in Q1 Mar’09 due to global meltdown witnessed 11 IPOs in Q1 Mar’10

Materials**** 20%

Industrials*** 19%

Technology 14%

Healthcare 7%

ConsumerProducts &

Services 9%

Consumer

Staples6%

Energy &Power 7%

Financials6%

Real Estate4%

Retail 4%

Media &Entertainment 3%

Telecom 1%

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***includes automobiles and components; building/construction and engineering; construction materials; machinery and other industrials; transportation and infrastructure ****includes chemicals; construction materials; containers and packaging; metals, mining and other materials; paper and forest products

..Indicates Paradigm Shift To Financials From Consumer

Products

60%

12% 10%

5%3%

2%2%

2%

2%1%

1%

Consumer Staples

Materials****

Telecom

Healthcare

Energy & Power

Technology

Industrials***

Financials

Consumer Products &Services

Media & Entertainment

Sector Breakup: Q1 Mar’09 Sector Breakup: Q1 Mar’10

In Q1 Mar’10, Financials was the leading sector mopping up to $16.4B followed by Materials with $10.2B and Industrialswith $7.9B

All three sectors collectively accounted for 65% of total IPO proceeds

In Q1 Mar’09, Consumer Products & Services sector was the leading sector- 60% of total proceeds followed by materialswith 12% and Telecom with 10% while in Q1 Mar’10 these sectors garnered 4%, 19% and 0.1% respectively

Real Estate sector which remained silent in Q1 Mar’09 due to global meltdown garnered $2.7B proceeds in Q1 Mar’10

31%

19%

15%

9% 6%

5%

4%

3%

3%

3%

2%

0%

Financials

Materials****

Industrials***

Technology

Energy & Power

Real Estate

Consumer Products& Services

Media &Entertainment

Retail

Healthcare

Consumer Staples

Telecom

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Asia Pacific 73%

EMEA 19%

North

America8%

North America 59%

Asia Pacific 30%

EMEA 11%

Around The World In Three Quarters (IPO Market-Wise)

Proceeds

Asia Pacific 73%

EMEA 12%

North

America12%

Central, SouthAmerica

& Carribean

3%

Asia Pacific 66%

EMEA 19%

North America

13%

Central, SouthAmerica &

Caribbean 2%

Asia Pacific 63%

North America14%

Central, South

America&

Caribbean 13%

EMEA10%

Asia Pacific 66%

EMEA 17%

NorthAmerica

11%

Central, SouthAmerica

& Carribean6%

Volume (No.)

Q1 Mar’09 Q4 Dec’09 Q1 Mar’10

In the last two quarters, the average value of proceeds has been equal across allregions, except in South and Central America where it is nearly 3 -4 times

In the first quarter of 2009, the average value of proceeds was incredibly high in North America when compared to other regions

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Tokyo 21%

HKEx 7%

NYSE 6%

Deutsche Borse4%

Toronto 3%

LSE 3%

Nasdaq 3%

AIM 1%

SGX 1%

ASX 1%

Others 51%

NYSE 6%

Nasdaq 5%

HKEx 4%

ASX 4%

Toronto 3%

AIM 3%

SGX 3%

Deutsche Borse2%

LSE 2%

Tokyo 1%Others 67%

HKEx 11%

ASX 10%

Tokyo 4%

NYSE 2%

SGX 2%

Other 71%

The Global IPO Pie…Stock Exchange-Wise

Proceeds

Volume (No.)

Q1 Mar’09 Q1 Mar’10

NYSE 59%

HKEx 14%

Tokyo 3%

ASX 2%

SGX 1% Other 22%

Value ofproceeds haveincreasedhumongously(nearly 400

times) in theTokyo StockExchange, fromQ1 Mar’09 to Q1Mar’10

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Top 10 IPOs globally raised $24.4B which represents about 46% of global capital raised in Q1 Mar’10

China dominated the largest IPO list, representing three of the largest ten initial public offerings

Top ten IPOs in Q1 Mar’10 include three financial and capital goods & services firms each, two materials firms and one

each from energy and communication Dai-ichi Life Insurance $10.9B was the largest IPO in Q1 Mar’10 across the globe, followed by $2.3B IPO of Huatai

Securities

The largest IPO of this quarter (Dai-ichi Life Insurance, Japan, $10.9B) was the largest IPO in last 15 months and it moppedup 21% of total global proceeds

– Banco Santander Brasil SA IPO was the largest IPO of 2009 which mopped up $8.1B which was just 45% (in terms of value) ofthe largest IPO of 2008 (Visa, US, $17.86B), but equivalentto largest IPO of 2007 (VTB Bank, Russia, $8B)

Financial sector was the pick with 3 largest IPOs in top 10, contributing 60% of the top 10 IPO proceeds

Company Name Country Offer DateIssue Size

($B)Industry Return (%)*

Dai-ichi Life Insurance Japan 23 Mar‘10 10.9 Financial N/A

Huata Securities China 12 Feb‘10 2.3 Financial 8%

United Company RUSAL Hong Kong 22 Jan‘10 2.2 Materials (17%)

China F irst Heavy Industries China 3 Feb‘10 1.6 Consumer (6%)

Korea Life Insurance South Korea 5 Mar‘10 1.5 Financial 7%

China XD Electric China 22 Jan’10 1.5 Consumer (-4%)

OSX Brasil SA Brazil 17 Mar‘10 1.3 Consumer (13%)

Athabasca Oil Sands Corp Canada 30 Mar’10 1.3 Energy N/A

Kabel Deuts chland Germany 19 Mar’10 0.9 Communication (5%)

African Barrick Gold United Kingdom 19 Mar’10 0.8 Materials 1%

* Offer price to closing price on 31 st Mar’10

The Heavyweights: Largest IPOs in Q1 Mar’10 (Global)

Top Three IPOs in Q1 Mar’10 accounted for 29% of the quarter’s global IPO proceeds

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India’s Largest IPOs in Q1 Mar’10

Company Issue Size(INR M)

Issue Size($M)

Issue Price(INR)

Price (INR)31 MAR’09

Return*(%)

JSW Energy 38,187 818 100 111.8 11.8%

DB Realty 15,000 324 468 458.5 (2.0%)

IL&FS Transportation Networks 7,000 156 258 281.6 7.9%

Hathway Cable & Data 6,648 143 240 206.9 (13.7%)

Godrej Properties 4,620 99 490 513.0 4.7%

D.B. Corp 3,853 83 212 236.5 12.8%

Jubilant FoodWorks 3,287 72 145 314.9 116.3%

United Bank 3,300 71 66 68.7 3.9%

Infinite Computers 1,898 42 165 190.0 15.7%

Vasco Engineers 1,782 38 165 154.0 (5.9%)

Man Infra Constructions 1,418 31 252 359.3 42.9%

Of the total amount mobilized through the primary market by corporate India, 4 issues raised over INR 67B (72% oftotal IPO proceeds in Q1 Mar’10)

Of the total amount mobilized in Q1 Mar’10, largest IPO (JSW Energy) garnered 41% of total proceeds

7 IPOs out of top 10 and a total of 14 of all the 18 IPOs were trading above the issue price as of 31 Mar’10

Only 3 IPOs out of top 10 IPOs and 4 out of all the 18 IPOs were trading below their issue price as of 31 Mar’10

* Offer price to closing price on 31 st Mar’10

Garnered41% of totalIPO proceeds

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6000

11000

16000

21000

26000

Quarterended BSE AbsoluteChange % Change P/E

2 Jan’08 20,301 3,136 18.1% 27.8x

1 Apr’08 15,627 (4,839) (23.6%) 20.1x

1 July’08 12,962 (2,665) (17.1%) 15.9x

1 Oct’08 13,056 94 0.7% 16.3x

2 Jan’09 9,958 (3,098) (23.7%) 12.7x

Quarterended BSE AbsoluteChange %Change P/E

1 Apr’09 9,902 (56) (0.6%) 13.9x

1 Jul’09 14,646 4,744 47.9% 19.2x

1 Oct’09 17,135 2,489 17.0% 22.2x

4 Jan’10 17,559 424 2.5% 22.5x

01 Apr’10 17,692 133 0.8% 21.49x

Bear Stern Collapse

FIIs pulled out$3.2B in Jan’08

Sensex dips below 7,000 in intra – day Citigroup Bailout by US Fed

Lehman Brothers files for Bankruptcy AIG Bailout led by US fed Icelandic Financial Crisis First RBI’s series of rate cuts

UPA sans Left support, back in power

Dubai Debtcrisis

RBI hikes CRR, firsttime since Sep’08

Satyam fiasco Weak domestic

flow

20,286

17,693

(13%)

Indian Stock Market Performance Over Last 2 Years..

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Jan'09 Feb'09 Mar'09 Apr'09 May'09 Jun'09 Jul'09 Aug'09 Sep'09 Oct'09 Nov'09 Dec'09 Jan'10 Feb'10 Mar'10

(42) (24)

5

65

201

38

111

49

183

91

55

102

(5)

12

199

2004 2005 2006 2007 2008 2009 Q1 2010

388 467 364

701

(530)

834

206

Net Investment (INR B)

Net Investment (INR B)

In 2008 there was a net outflow of FIIs, the 1st time in last 10 years

In 2009, FIIs came back in full gusto and invested INR 834B, whichboosted the investor sentiments and pushed the Sensex beyond17,000, posting a 81% gain in 2009

UPA government won thegeneral elections with fullmajority in May’09 whichboosted FIIs’ confidence inthe Indian economy

FIIs invested INR 201B inMay and took Sensex 28%up

In Jan’10 there was net outflow of FIIs, the 1st time in last 11months

Mar’10 witnessed the biggest monthly inflows into the IndianEquity markets from the FIIs since May’09 which helped tomarkets to touch its 18 month high

…Has Been Driven By And Dependent Upon FIIs Activity

A C

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100

199

342

185157

93

3975

103

3717 19

2005 2006 2007 2008 2009 Q1 Mar'10

0

50

100

150

200

250

300

350

400

Proceeds (INR M) No. of IPO

Jan'05 Apr'05 Jul '05 Oct '05 Jan'06 Apr'06 Jul '06 Oct '06 Jan'07 Apr'07 Jul '07 Oct '07 Jan'08 Apr'08 Jul '08 Oct'08 Jan'09 Apr'09 Jul '09 Oct '09 Jan'10

Q1 Mar ‘10 has seen more IPOsthan the whole of 2009.However, the average value ofproceeds has fallen considerablyfromINR 9.2B to INR 4.9B

IPO market fall or rise hasbeen in sync with the stockmarkets clearly reflectingmomentum value attachedto buyers interest for anIPO

BSE Sensex

Indian IPO Market

Indian IPO Market Performance On Par with Sensex…

6,556

17,527

+167%

Mar’10

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15,644

13,46212,860

9,6479,709

14,494

17,12717,465 17,528

Q1 Mar'08 Q2 Jun'08 Q3 Sep'08 Q4 Dec'08 Q1 Mar'09 Q2 Jun'09 Q3 Sep'09 Q4 Dec'09 Q1 Mar'10

BSE Sensex gained 85% in thelast 15 moths

BSE Sensex

Indian IPO Market

159.8

8.1 16.60.8

0.20.2

124.3

32.0

93.4

13

9 123

1 1

8 719


0

20

40

60

80

100

120

140

160

180

Proceeds (INR M) No. of IPO

The IPOs also crossed the pitand are entering a much betterphase now

…The Fall From Crest &The Rise From Ashes

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TradeDate Company Sector

Size(INR M)

PriceBottomRange Offering Price vs. Price Range

PriceTop

Range

PerformanceOne Month

Post IPO (%)

30 Mar’10 IL&FS Transportation Networks REI** 6,117 242 258 7.9%***

29 Mar’10 D Q Entertainment (International Ltd) TMT* 1,284 75 80 40.3%***

18 Mar'10 United Bank Banking 3,300 60 66 3.9%***

11 Mar'10 Man Infra Constructions REI** 1,418 243 252 42.9%***

10 Mar'10 Texmo Pipes & Products industrial 450 85 90 2.6%***

03 Mar'10 Arss Infrastructure REI** 103 410 450 106.3%***

25 Feb'10 Hathway Cable & Data TMT* 6,648 240 265 (14.6%)

24 Feb'10 Emmbi Polyarns industrial 431 468 486 (48.8%)

24 Feb'10 DB Realty REI** 1,500 40 45 (3.7%)

23 Feb'10 Aqua Logistics Industrial 150 200 225 11.6%

19 Feb'10 Thangamayil Jwellery HCLS**** 106 70 75 6.4%

15 Feb'10 Vasco Engineers industrial 1,782 65 75 (15.9%)

15 Feb'10 Syncom Healthcare TMT* 563 165 185 (62.1%)

08 Feb'10 Jubilant FoodWorks CGR***** 3,287 135 145 77.9%

03 Feb'10 Infinite Computers TMT* 1,898 155 165 21.6%

11 Jan'10 MBL Infrastructures REI** 342 165 180 12.7%

06 Jan'10 D.B. CORP TMT* 3,853 185 212 11.4%

05 Jan'10 Godrej Properties REI** 4,620 490 530 (2.6%)

04 Jan'10 JSW Energy Power 38,187 100 115 9.7%

IPO Subscription Diagnostic: Most IPO’s Subscribed..

66

252

90

450

240

468

45

220

75

75

165

145

165

180

212

490

100

*Telecom, Media & Technology , **Real Estate & Infrastructure, ****Healthcare & Lifesciences *****Consumer Goods & Retail, *** a s on 31 Mar’10

258

80

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1.68 4.00

39.54

1.97

43.22

31.11

1.225.17

1.12 1.94 1.202.95 1.36

47.62

7.48

62.52

33.3833.49

86.32

Median: 5.17x

IPO Oversubscribed By…

DQ Entertainment (International) LtdIPO witnessed an overwhelmingresponse from the investors followedby Man Infra Constructions, ARSSInfrastructure, Infinite Computers andD.B.Corp

Real Estate & Infrastructure was thehottest sector among the

investors, witnessed 32% of totalIPOs

3 IPOs out of total 6 within thissector got subscribed by morethan 30x times

..At Higher Band Clearly Reflecting Customers Buoyancy

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Q1Mar'08

Q2Jun'08

Q3Sep'08

Q4Dec'08

Q1Mar'09

Q2Jun'09

Q3Sep'09

Q4Dec'09

Q1Mar10

13

9

12

3

1 1

87

19

IPO Activity Ramping Up, Coming Out Of Slumber…

IPOs market in India made a good beginning in Q1 Mar’10, raising $2.3B through19 IPOs

In terms of volume, Q1 Mar’10 was the best quarter in the last 9 quarters

With 19 IPOs in Q1 Mar’10, India had the third largest number of IPOs after Chinaand the US

2009 witnessed the lowest number of IPOs in the last 6 years followed by 2008,17& 37 respectively

In Q1 Mar’10, the no. of IPOs oversubscribed by more than 30 times was 8

In 2009, only one IPO (OIL India) was able to oversubscribe by more than30 times

In 2008, two IPOs were able to oversubscribe by more than 30 times

2005 2006 2007 2008 2009 Q1 2010

39

75

103

37

17 18

No. of IPOs: (2005 – 2009)*

* On the basis of listings

Only 1 IPO was withdrawn in2009 as compared to 3 in 2008

IPO market got active in 3rd

and4th quarter of 2009

Activity in Q1 Mar’10 was lead byReal Estate & Infrastructuresector which remained silentthrough the 2009

Sector witnessed 32% ofthe total IPO volume

IPO Volume (No.)*

Only 3 months in 2010witnessed more numberof IPOs than issued in12 months in 2009

contd…

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Proceeds* (INR B)

2005 2006 2007 2008 2009 2010**

100

199

342

185157

93

Proceeds* (INR B)

Capital raised by Corporate India through IPO route in Q1 Mar’10 aggregated atINR 93.4B

Capital raised by Corporate India through IPO route in 2009 aggregated atINR157B, lowest in the last 5 years (Till YTD 2010)

JSW Energy was the largest IPO of Q1 Mar’10 mopping up INR 38B, contributing51% of total proceeds

YTD 2010, JSW Energy IPO was the 3rd largest IPO in last 3 years followed byReliance Power in 2008 and NHPC in 2009

– Reliance Power was the largest IPO of 2008 contributed 63% to total proceeds

– NHPC was the largest IPO of 2009 contributed 39% to total proceeds

The average IPO size in Q1 Mar’10 was INR 4.9B

The average IPO size was INR 9.2B in 2009 and INR 5.0Bin 2008

Q1 Mar’10 was the second bestquarter in terms of capital raisedafter Q3 Sep’09

Q2 Jun’09 and Q1 Mar’09 were theleanest quarters in last 9 quarterswitnessing only 1 IPO in eachquarter

First 6 months of 2009 contributed just 0.3% of the total IPO proceedsin 2009


..With Renewed Optimism Being Felt In Markets

Q1Mar'08

Q2Jun'08

Q3Sep'08

Q4Dec'08

Q1Mar'09

Q2Jun'09

Q3Sep'09

Q4Dec'09

Q1Mar10

160

817

10 0

124

32

93

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31

11 8

33

100

0

50

71 78


Performance* (% of IPOs)

Only IPOs which got listed in Q1 Mar’09 are trading above their issue price

In 2008, investors had a conservative approach towards new market entrants which resulted in poor performance ofthe IPOs listed during this period

A good percentage of IPOs listed after the Q2 Jun’09, have been performing reasonably well in the market

This can be attributed to the fact that investors are now looking to diversify and also encourage new entrants, as themarket scenario slowly moves out of the recession

In the first two quarters of 2009, there were only two IPO listings, one in each quarter. So, nothing much can be readinto the performance during this period

Kiri Dyes & Chemicals Limited, which was listed in Q2 Jun’08, has been the top performer with nearly 400% returns

IPO Scan: Performance Parameters In Last 2 Years

*%age of total IPOs listed in their respective quarters which are trading above their Issue price as on 15 Apr’10

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REI*** 31.6%

TMT** 26.3%

Industrial 15.8%

ConsumerGoods &

Retail10.5%

BFSI*5.3%

Healthcare 5.3% Energy&

Power 5.6%

Industrial37.8%

ConsumerGoods &

Retail 13.5%

TMT**13.5%

REI***13.5%

Energy &Power10.8%

Healthcare8.1%

BFSI* 2.7%

Sector Wise Comparison (Volume)

*Banking, Financial Services& Insurance, ** Technology, Media & Telecommunication,*** Real Estate & Infrastructure

# On the basis of listings

Volume (2008)#: 37 Volume (2009)#: 17

contd…

REI*** was the buzzing sector in Q1 Mar’10 with 32% of total IPO offerings followed by TMT** with 26% and Industrialswith 16%

REI***, Healthcare and BFSI* sectors which did not have any offerings in 2009, contributed nearly 42% (in total volume) inQ1 Mar’10

REI*** sector which did not see any activity in 2009 was the hottest sector in Q1 Mar’10 , witnessed 6 listings contributing32% to total volume

Volume (Q1 Mar’10)#: 19

Industrial29.4%

TMT* 17.6%

Energy &Power

17.6%

Hospitality11.8%

ConsumerGoods &

Retail 11.8%

Outsourcing5.9%

Education5.9%

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Energy & Power sector continued to remain the most active sector in Q1 Mar’10 in terms of proceeds. The sector

witnessed 41% of total proceeds followed by REI*** and TMT**

The Sector only witnessed a single IPO , that being JSW Energy which was also the largest IPO of Q1 Mar’10

JSW energy IPO garnered INR 38B proceeds

REI*** sector which remained silent in 2009 witnessed 32% of total IPO proceeds in Q1 Mar’10

DB Realty IPO was the second largest IPO of Q1 Mar ’10 garnering INR 15B followed by IL&FS TransportationNetworks with INR 7B and Hathway Cable & Datacom Ltd. with INR 6.6B

Energy &Power 77.3%

REI***8.0%

Industrials4.9%

TMT** 4.1% BFSI* 2.7% Consumer &

Retail 2.2%Healthcare0.8%

Energy &Power 68.0%

Industrials22.0%

Hospitailty

6.0%

TMT** 3.0% Consumer& Retail

1.2% Education

0.2%Outsourcing

0.0%

Energy &Power 40.9%

REI*** 32.2%

TMT** 16.3%

Consumer &Retail 3.6%

BFSI* 3.5%Industrials

2.9%

Healthcare

0.6%

Sector Wise Comparison (Proceeds)

Proceeds (2008)#: INR 185B Proceeds (2009)#: INR 157B Proceeds (Q1 Mar’10)#: INR 93B

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IPOs: Sector Wise Comparison in Q1 Mar’10

Sector

IPO Proceeds(INR B)

% of IPOProceeds

IPOVolume

% of IPOVolume

Energy & Power 38.2 40.9% 1 5.3%

Real Estate & Infrastructure 30.1 32.2% 6 31.6%

Telecom, Media & Technology 15.2 16.3% 5 26.3%

Consumer Goods & Retail 3.4 3.6% 2 10.5%

Banking, Financial Services * Insurance 3.3 3.5% 1 5.3%

Industrials 2.7 2.9% 3 15.8%

Healthcare & Life sciences 0.6 0.6% 1 5.3%

Total 93.4 100.0% 18 100.0%

IPOs Issued in Q1 Mar’10

Although Energy & Power sector witnessed the highest proceeds, there was only 1 IPO in Q1 Mar’10

In terms of number of IPOs, Real Estate & Infrastructure witnessed the highest volume in Q1 Mar’10 followed by Telecom, Media &Technology, 6 & 5 IPOs respectively

Real Estate & Infrastructure, Banking, Financial Services & Insurance and Healthcare & Lifesciences which remained silent in 2009witnessed 42% of total IPO volume in Q1 Mar’10

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Symptoms of a bull-market cycle are on the cards: A slew of mid-sized companies are gearing up to tap theequity market in the near term, piggy-backing on the prevailing feel-good factor in the market

This rush to raise capital may also see some companies with ‘not so gooda track record’, trying their hands

I-banks looking to earn more this year in higher fees : With the economy recovering, and rush for capital bygoing public set to return this fiscal, I-bankers are looking to turnaround the trend of cheap services in the past fiscal

While fees had on an average been about 2% of the deal size in the boom year of 2007, they had shrunk to less than1% during these recessionary times when IPOs had all but dried up

They plan to charge higher fees from mid to small size companies because greater effort has to be expended inmarketing them, which is not the case with larger firms

Real Estate companies eyeing IPOs: With the stock markets perking up and the real estate sector's health also

recovering,about 15 mid-and-large realty players are looking to tap the capital market through IPOs this year PSU Divestment: The Government is looking to go the IPO and FPO route for divestment in the current fiscal

Has set a target of raising INR 40B in the current fiscal, up from INR 25B from last fiscal

Finance Minister has provided a list of 28 PSUs for divestment in the services sector

This fiscal should see 12-15 PSUs getting divested

– On the block already are Satluj Jal Vidyut Nigam Ltd. (SJVNL), Engineers India Ltd. (EIL), Coal India and SteelAuthority India Ltd. (SAIL). BSNL is a strong candidate as well for divestment this year given the heightened sense ofanticipation for this scrip for quite some time now

Indian IPO Market: The Road Ahead…

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In Q1 Mar’10, 22 companies filed offer document with SEBI

In 2009, 64 companies filled offer document with SEBI to raise nearly INR 400B through public issues. Besides, more than100listed firms have announced plans to raise INR 1T through qualified institutional placement (QIPs) and more than 31 listedfirms want to raise money through rights issues

Out of the 64 offer documents filled with SEBI in 2009, only 6 IPOs made their debut

Telecom, Media & Technology sector witnessed the highest filling (23%), followed by Industrial and Consumer Goods & Retailwith 18% and 18% respectively in Q1 Mar’10

Offer document filled with SEBI in 2009 declined to almost 34% from 2006

2006 witnessed the highest filing in last 5 years

New Entrants Coming Up..Offer Document Filed With SEBI

REI*30%

Industrial19%

TMT**17%

DHRP Filled (Q1 Mar’10): Sector Breakup

2005 2006 2007 2008 2009 Q1Mar'10

116

188

140

66 64

22

DHRP Filled: Volume

TMT** 23%

Industrials 18%

ConsumerGoods & Retail

18%

REI*** 18%

Energy &Power 9%

BFSI* 5%

Healthcare 5% Education 4%

*Banking, Financial Services& Insurance, ** Technology, Media & Telecommunication,*** Real Estate & Infrastructure

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Summary of IPOs Listed in Q1 March 2010

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Sector: Energy & Power

Company NameIssue Price

(INR)Issue Size

(INR M)Issue Size

($M)IPO

GradingSubscription Listing Date

Price31 Mar’10

Return#(%)

JSW Energy 100 38,187.2 818 3 1.68x 04 Jan’10 111.8 11.8%

# Offer price to closing price on 31st Mar’10

No. of IPOs Issue Size (INR M) Total Issue Size ($M) % of total IPO proceeds

1* 38,187.2 818 40.9%


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Sector: Real Estate & Infrastructure


(INR)Issue Size

(INR M)Issue Size

($M)IPO


Price31 Mar’10

Return#(%)

Godrej Properties 490 4,620.0 99 4 4.00x 05 Jan'10 513.1 4.7%

MBL Infrastructures 180 1,026.0 22 2 1.97x 11 Jan'10 225.7 25.4%

DB Realty 468 15.000.0 324 2 2.95x 24 Feb'10 458.5 (2.0%)

Arss Infrastructure 450 1,030.0 22 2 47.62x 03 Mar'10 928.5 106.3%

Man Infra Constructions 252 1,417.5 31 3 62.52x 11 Mar'10 360.1 42.9%

IL&FS Transportation Networks 258 7,000.0 156 4 33.42x 30 Mar'10 278.5 7.9%


6* 30,093.7 654 32.2%

* On the basis of list ings # Offer price to closing price on 31st Mar’10

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Sector: Telecom Media & Technology


(INR)Issue Size

(INR M)Issue Size

($M)IPO


Price31 Mar’10

Return#(%)

D.B. Corp 212 3,853.1 83 4 39.54x 06 Jan'10 239.2 12.8%

Infinite Computers 165 1,898.0 42 2 43.22x 03 Feb'10 190.1 15.7%

Aqua Logistics 220 1,521.6 33 3 1.94x 23 Feb'10 271.2 23.3%

Hathway Cable & Data 240 6,648.0 143 3 1.36x 25 Feb'10 207.2 (13.7%)

D Q Entertainment(International Ltd)

80 1,238.8 282 3 86.32x 29 Mar’10 112.3 40.3%


5* 15,204.5 582 16.3%


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Sector: Consumer Goods & Retail


(INR)Issue Size

(INR M)Issue Size

($M)IPO


Price31 Mar’10

Return#(%)

Jubilant FoodWorks 145 3,287.2 72 3 31.11x 08 Feb'10 313.7 116.3%

Thangamayil Jwellery 75 105.5 2 3 1.12x 19 Feb'10 81.4 8.5%


2* 3,392.7 74 3.6%


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Sector: Banking, Financial Services & Insurance


(INR)Issue Size

(INR M)Issue Size

($M)IPO


Price31 Mar’10

Return#(%)

United Bank 65 3,300.0 71 4 33.38x 18 Mar'10 68.6 3.9%


1* 3,300 71 3.5%


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Sector: Industrials


(INR)Issue Size

(INR M)Issue Size

($M)IPO


Price31 Mar’10

Return#(%)

Vasco Engineers 165 1,782.0 38 3 1.22x 15 Feb'10 155.3 (5.9%)

Emmbi Polyarns 45 430.8 9 2 1.20x 24 Feb'10 20.8 (53.9%)

Texmo Pipes & Products 90 450.0 102

7.48x 10 Mar'10 92.4 2.6%


3* 2,662.8 57 2.9%


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Sector: Healthcare & Lifesciences


(INR)Issue Size

(INR M)Issue Size

($M)IPO


Price31 Mar’10

Return#(%)

Syncom Healthcare 75 562.5 12 2 5.17x 15 Feb'10 88.0 59.9%


1* 562.5 12 0.6%


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Appendix

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2005 2006 2007 2008 2009 Q1 Mar'10

17

65

124

76

183

109

39

79

103

37

17 19

China India

Volume* (No.)

Proceeds* ($B)

2005 2006 2007 2008 2009 Q1 Mar'10

6.0

17.1

65.9

14.9

50.4

19.7

4.5 7.2 8.64.7 3.3 2.3

China India

China has seen a much greatervolume of IPOs than India in thisperiod. Similarly, average value ofproceeds is also on the higher sidefor China


India vs China In Terms of IPOs…Beyond Population Game

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Disclosure

Deal value doesn’t include those deals whose values are not disclosed

Only those deals have been included in the report which been completed in the particular period

The report also covers Venture Capital Deals

The report doesn’t includes block deals

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