INDIA INFRASTRUCTURE FINANCE COMPANY LIMITED A wholly owned Government of India Undertaking

HIGHLIGHTS OF TAX BENEFITS INDIA INFRASTRUCTURE FINANCE COMPANY LIMITED A wholly owned Government of India Undertaking Interest from these Bonds do not form part of total income as per provisions of Section 10 (15) (iv) (h) of Income Tax Act, 1961 read along with Section 14A (1) of the IT Act. There shall be no deduction of tax at source from the interest payable on the Bonds. Wealth Tax is not levied on investment in bonds under section 2(ea) of the Wealth-tax Act, 1957 In pursuance of Section 2 (29A) of the IT Act, read with section 2 (42A) of the IT Act, the Bonds since listed on BSE, shall be treated as a long term capital asset if the same is held for more than 12 months immediately preceding the date of transfer. As per third proviso to section 48 of the Act, benefits of indexation of cost of acquisition under second proviso of section 48 of the Act is not available in case of bonds and debenture, except capital indexed bonds. Thus, long term capital gain tax can be considered at the rate of 10% on listed bonds without indexation. COMPANY PROFILE A wholly-owned Government of India undertaking incorporated under the Companies Act in January 2006. Commenced operations in April 2006 and notified as a Public Financial Institution in January 2009. Provides financial assistance to long-term infrastructure projects in diversified sectors such as roads, bridges, railways, seaports, airports, inland waterways, other transportation projects, power, urban transport, water supply, sewage, solid waste management and other physical infrastructure in urban areas, gas pipelines, infrastructure projects in special economic zones, international convention centres and other tourism related infrastructure projects, cold storage chains, warehouses, and fertilizer manufacturing industry. Provides refinance for loans sanctioned by banks and other eligible institutions, in accordance with the eligibility criteria set out in the Refinance Scheme. Has three wholly owned subsidiaries, India Infrastructure Finance Company (UK) Limited, IIFCL Projects Limited and IIFCL Asset Management Company Limited. Contributor along with IDFC and Citigroup Inc., in the India Infrastructure Fund constituted in 2007, to facilitate large scale capital investments in infrastructure assets in India through a combination of long term debt and equity capital raised in several tranches. The India Infrastructure Fund is registered with SEBI as a domestic venture capital fund. The cumulative gross loans sanctioned by IIFCL, under direct lending as on September 30, 2012, on an unconsolidated basis, aggregated to Rs. 49,603.31 Crores in 282 projects with total project cost of Rs. 4,50,547.90 Crores and the total disbursement of Rs. 23,702.03 Crores. Debt-equity ratio stood at 5.17:1 as at December 31 st, 2012, on an unconsolidated basis. Source: Shelf Prospectus dated December 10, 2012 & Prospectus Tranche-II dated February 20, 2013

SALIENT FEATURES OF THE PROPOSED TAX FREE BONDS Tax benefits u/s 10 (15) (iv) (h) of the Income Tax Act, 1961 Interest from these Bonds shall not form part of total income of any person/ assessee Credit Rating of [ICRA] AAA (Stable) by ICRA; BWR AAA (Stable) by BRICKWORK and CARE AAA by CARE Bonds can be held in physical or in dematerialized form, at the option of bondholders but the trading of the Bonds shall be in dematerialized form only Bonds are proposed to be listed on the BSE Strengths Strong GoI support and relationships with government entities: IIFCL is a wholly owned government company and controlled by GoI. The company s ownership and position as a policy based institution for promotion of infrastructure development have helped in shaping the contours of infrastructure financing in the country. Well-developed relationships with banks and financial institutions: The company maintains well-developed relationships with multilateral and bilateral financing institutions, domestic financing institutions as well as scheduled commercial banks. These relationships enable the company to encourage an increased flow of long-term capital, including foreign capital into infrastructure projects in India and also enable them to play a key role in developing and introducing innovative financial products and structures to allow a broader cross-section of lenders and investors to participate in infrastructure financing in India. Financial strength: The company s CAGR over the last three Fiscals of the unconsolidated profit after interest before tax and profit after tax stood at 78.38% and 79.88%, respectively. As at September 30, 2012, Fiscal 2012, 2011 and 2010, the cumulative gross loans sanctioned under direct lending, on an unconsolidated basis, were Rs. 49603.31 Crores, Rs. 40373.00 Crores, Rs. 31778.00 Crores and Rs 24375.00 Crores respectively. Strong asset quality and robust credit and risk management policies: IIFCL s disciplined credit and risk management policies have enabled it to achieve a strong asset quality over the years. As at March 31, 20 12, the Company had nil non-performing advances and as at September 30, 2012, we had non-performing assets aggregating to Rs. 13.65 Crores. Experienced management team and professional staff: IIFCL s management team and professional staff have expertise in various areas such as project finance, financial markets and advisory services, as well as domain knowledge and experience in the various sectors to which it provides financing. This contributes to understand and & effectively manage its business. Source: Shelf Prospectus dated December 10, 2012

ISSUE STRUCTURE COMMON TERMS FOR ALL SERIES OF THE BONDS Issuer India Infrastructure Finance Company Limited Issue of Bonds Public issue of tax free bonds in the nature of secured redeemable non-convertible bonds of the Company of face value of Rs.1,000 each, having benefits under section 10(15)(iv)(h) of the Income Tax Act, proposed to be issued by the Company pursuant to the relevant Tranche Prospectus. The Bonds will be issued in one or more tranches subject to the Shelf Limit.* This Tranche-II Issue by the Issuer is of Bonds aggregating to Rs. 200 Crores with an option to retain oversubscription up to the Residual Shelf Limit* and is being offered by way of the Prospectus Tranche II containing, inter alia, the terms and conditions of Tranche II Issue, which should be read together with the Shelf Prospectus dated December 10, 2012 filed with the RoC, the Designated Stock Exchange and SEBI. * In terms of the Notification, the Company has raised Rs.785 Crores on a private placement basis in two tranches, through information memoranda dated November 9, 2012 and November 16, 2012, and Rs. 2883.88 Crores by way of a public issue under the Tranche-I Issue through the Prospectus Tranche-I. Accordingly the Residual Shelf Limit is Rs. 6331.12 Crores. This Limit shall be applicable for raising further funds through public issue route and/or the private placement route, such that the aggregate amount raised through private placement route shall not exceed Rs.2500 Crores i.e., up to 25% of the allocated limit for raising funds through Tax Free Bonds during Fiscal 2013, in terms of the Notification. In case the Company raises funds through private placements during the process of the present Issue, the Residual Shelf Limit for the Issue shall be reduced by such amount raised. Face Value (Rs.) Rs. 1,000 Issue Price (Rs.) Rs. 1,000 Mode of Issue Public issue Credit Ratings [ICRA] AAA by ICRA, BWR AAA (Stable) Brickworks & CARE AAA by CARE Ratings Put/Call Option There is no put/call option for the Bonds Listing BSE. For more information, see Terms of the Issue Listing on page 49. Bond Trustee IL&FS Trust Company Limited (in its capacity as the Bond Trustee, which expression will include its successor(s)) as trustee) Depositories Central Depository Services (India) Limited ( CDSL ) and National Securities Depository Limited ( NSDL ) Registrar Karvy Computershare Private Limited Issuance In dematerialised form and physical form, at the option of the Applicant*** Trading In dematerialised form only*** Market Lot / Trading Lot One Bond Deemed Date of Allotment The Deemed Date of Allotment will be the date on which the Board of Directors has approved the Allotment of Bonds for each Tranche Issue or any such date as may be determined by the Board of Directors. All benefits under the Bonds including payment of coupon rate (as specified in the Prospectus Tranche-II) will accrue to the Bondholders from the Deemed Date of Allotment. Actual Allotment may occur on a date other than the Deemed Date of Allotment. Lead Managers A.K. Capital Services Limited, SBI Capital Markets Limited, Axis Capital Limited, ICICI Securities Limited and Kotak Mahindra Capital Company Limited Tranche Issue Opening Date February 25, 2013 Tranche Issue Closing Date Interest on Application Money Interest on application monies received which are liable to be refunded Option to retain oversubscription Step up/step down Coupon Rate March 15, 2013. The Issue shall open for subscription from 10 a.m. to 5 p.m. during the period indicated above with an option for early closure (subject to the Issue being open for a minimum of three Working Days) or extension by such period, which may be extended up to 30 Working Days from the date of opening of the Issue, as may be decided by the Board of Directors in accordance with applicable law. In the event of early closure or extension, the Company shall ensure that public notice of such early closure or extension is published on or before such early date of closure or Issue Closing Date, as applicable, through advertisement(s) in a leading national daily newspaper. at the rate of 6.86% p.a., 7.02% p.a. and 7.08% p.a. on Tranche-II Series 1, Tranche-II Series 2 and Tranche-II Series 3, respectively, for Allottees under Category I, II and III Portions and at the rate of 7.36% p.a., 7.52% p.a. and 7.58% p.a. on Tranche-II Series 1, Tranche-II Series 2 and Tranche-II Series 3 for Allottees under Category IV Portion, (except for ASBA Applicants), subject to deduction of tax at source, as applicable. at the rate of 5.00% per annum,, (except for ASBA Applicants), subject to deduction of tax at source, as applicable Tranche-II Issue by the Issuer is of Bonds aggregating to Rs. 200 Crores with an option to retain oversubscription up to the Residual Shelf Limit Additional coupon rate of 0.50% to be paid to original Allottees under Category IV Portion. If Bonds held by the original Allottees under Category IV Portion are sold/transferred (except in case of transfer of Bonds to legal heirs in the event of death of the original Allottee), the coupon rate shall stand revised to the coupon rate applicable for Allottees falling under Category I, II and III Portions. ** With respect to the provisions of Section 372A (3) of Companies Act, it may be noted that the RBI has through its circular (Circular No. UBD.BPD. (PCB).Cir.No.35/16.11.00/2012-13) dated January 30, 2013 revised the Bank Rate from 9.0% to 8.75% w.e.f. January 29, 2013. Coupon rate on the Bonds has been determined in pursuant of the Notification. Companies other than banking companies, insurance companies and other companies as mentioned in Section 372A(3) of the Companies Act may however seek independent opinion from their legal counsels about the eligibility to make an application for the Bonds. ***In terms of Regulation 4(2) (d) of the Debt Regulations, the Company will make public issue of the Bonds in the dematerialized form. However, in terms of Section 8 (1) of the Depositories Act, 1996 ( Depositories Act ), the Company, at the request of the Investors who wish to hold the Bonds in physical form will fulfill such request. However, trading in Bonds shall be compulsorily in dematerialized form.

BOND PARTICULARS Series of Bonds* Options Tranche-II Series 1 Tranche-II Series 2 Tranche-II Series 3 Tenor 10 years 15 years 20 years Minimum Application Five Bonds (Rs. 5,000) (individually or collectively, across Series) In multiples of One Bond (Rs. 1,000) Maturity / Redemption Date Redemption Amount (Rs.Bond) Coupon Type Coupon Payment Date Coupon Reset Process 10 years from the Deemed Date of Allotment 15 years from the Deemed Date of Allotment 20 years from the Deemed Date of Allotment Repayment of the Face Value plus any interest that may have accrued at the Redemption Date Fixed Coupon Rate The date, which is the day falling one year from the Deemed Date of Allotment, in case of the first coupon payment and the same date every year, until the Redemption Date for subsequent interest payments. Not applicable Frequency of Coupon Payment Annual Annual Annual Coupon Rate (%) p.a. for Category I, II, III and IV Additional Coupon Rate (%) for Category IV** Aggregate Coupon Rate (%) for Category IV** Annualized Yield (%) for Category I, II and III Annualized Yield (%) for Category IV** 6.86% 7.02% 7.08% Additional coupon rate of 0.50% to be paid to original Allottees under Category IV Portion. 7.36% 7.52% 7.58% 6.86% 7.02% 7.08% 7.36% 7.52% 7.58% The Company shall Allot Tranche-II Series 3 Bonds, to all valid applications, wherein the Applicants have not indicated their choice of the relevant Series. ** If Bonds held by the original Allottees under Category IV Portion are sold/transferred (except in case of transfer of Bonds to legal heirs in the event of death of the original Allottee), the coupon rate shall stand revised to the coupon rate applicable for Allottees falling under Category I, II and III Portions

Who can apply? Category I Category II Category III Category IV Qualified Institutional Buyers Domestic Corporates* High Networth Individuals Retail Individual Investors ("QIBs")* ( HNIs ) ( RIIs ) Public financial institutions specified in Section 4A of the Companies Act, Scheduled commercial banks, Mutual funds registered with SEBI, Alternative Investment Fund registered with SEBI, Multilateral and bilateral development financial institutions, State industrial development corporations, Insurance companies registered with the Insurance Regulatory and Development Authority, Provident funds with a minimum corpus of Rs 25 Crores, Pension funds with a minimum corpus of Rs 25 Crores, The National Investment Fund set up by resolution F. No.2/3/2005- DD-II dated November 23, 2005 of the GoI, published in the Gazette of India, Insurance funds set up and managed by the army, navy, or air force of the Union of India and Insurance funds set up and managed by the Department of Posts, India. Companies within the meaning of section 3 of the Companies Act, bodies corporate and Limited Liability Partnerships registered under the applicable laws in India and authorised to invest in Bonds Resident Individual Investors applying for Bonds aggregating to more than Rs. 10 lakhs, across all Series of Bonds in this Tranche-II Issue. Hindu Undivided Families through the Karta applying for Bonds aggregating to more than Rs. 10 lakhs across all Series of Bonds in this Tranche- II Issue. Resident Individual Investors applying for Bonds aggregating up to and including Rs. 10 lakhs across all Series of Bonds in this Tranche-II Issue. Hindu Undivided Families through the Karta applying for Bonds aggregating up to and including Rs. 10 lakhs across all Series of Bonds in this Tranche-II Issue. * With respect to the provisions of Section 372A(3) of Companies Act, it may be noted that the RBI has through its circular (Circular No. UBD.BPD.(PCB).Cir. No.35/16.11.00/2012-13) dated January 30, 2013 revised the Bank Rate from 9.0% to 8.75% w.e.f. January 29, 2013. Coupon rate on the Bonds has been determined in pursuant of the Notification. Companies other than banking companies, insurance companies and other companies as mentioned in Section 372A(3) of the Companies Act may however seek independent opinion from their legal counsels about the eligibility to make an application for the Bonds.

Applications cannot be made by: a) Minors without a guardian name; b) Foreign nationals (including NRIs, person s resident outside India, Foreign Institutional Investors and Qualified Foreign Investors). c) Venture Capital Funds and Foreign Venture Capital Investors. d) Overseas corporate bodies ( OCBs ). e) Co-operative societies. f) Regional rural banks. g) Societies. h) Public/ private charitable/ religious trusts. i) Scientific and/or industrial research organizations. j) Partnership firms. l) Persons ineligible to contract under applicable statutory/regulatory requirements. m) Any other category of investors not mentioned in Categories I, II, III and IV above. Allocation Ratio: Qualified Institutional Buyers Portion 20% of the Overall Issue Size Domestic Corporate Portion 20% of the Overall Issue Size High Networth Individuals Portion 20% of the Overall Issue Size Retail Individual Investor Portion 40% of Overall the Issue Size Note: On First come first serve basis determined on the basis of the date of upload of each Application into the electronic system of the Stock Exchange Modes of Making Applications: Applicants may use any of the following facilities for making Applications: Mode of Submission of Application Forms ASBA Applications Non-ASBA Applications To whom the Application Form has to be submitted (i) If using physical Application Form, (a) to the Members of the Syndicate or Trading Members of the Stock Exchanges only at the Specified Cities ( Syndicate ASBA ), or (b) to the Designated Branches of SCSBs where the ASBA Account is maintained; or (ii) If using electronic Application Form, to the SCSBs, electronically through internet banking facility, if available. The Members of the Syndicate or Trading Members of the Stock Exchanges. Note: Applications for Allotment in physical form can be made only by using non-asba Applications.

FINANCIAL HIGHLIGHTS (Standalone) (Rs. in crores) As on/for the year 31-Mar-08 31-Mar-09 31-Mar-10 31-Mar-11 31-Mar-12 Shareholder's Funds 332.18 1,133.95 2,086.45 2,582.25 3,668.08 Long-term Borrowings* 3,200.00 14,419.35 18,474.38 19,872.04 20930.33 Short-term Borrowings 297.62 - - 1,182.08 2,743.69 Long-term Loans & Advances# 1,683.83 4,864.80 9,772.74 14,140.98 18,037.15 Cash & Cash Equivalents 1,516.97 10,065.78 5,487.17 7,038.08 8,179.09 Short-term Loans & Advances 10.54 34.92 54.93 291.69 538.44 Revenue from Operations 119.89 633.62 1,557.84 1,945.75 2,540.43 Total Expenses 86.57 485.99 1,348.49 1,506.19 1,631.94 Profit before Tax 33.73 150.04 237.87 445.68 865.99 Profit for the year from continuing operations 24.81 100.65 153.76 295.80 585.83 *Long-term borrowings includes Current maturities of long term debt # Long-term Loans & Advances includes amount of loans due within a year Source: Shelf Prospectus dated December 10, 2012