RDB REALTY AND INFRASTRUCTURE LTD. (RDBRIL)

Date :5 th November, 212 RDB REALTY AND INFRASTRUCTURE LTD. (RDBRIL) Stock Performance Details Current Price : Rs. 29.** Face Value : Rs. 1 per share 52 wk High / Low : Rs. 43.75 / Rs. 18.1 Total Traded Volumes : 8,99 shares** Market Cap : Rs. 31 crore** Sector : Realty EPS (FY211) : Rs. 12.7 per share P/E (TTM) : 2.2 (x)^ P/BV (TTM) :.4 (x)^ Financial Year End : 1 st April 31 st March BSE Scrip Name : RDBRIL BSE Scrip Code : 533285 **as on 5 th November, 212; ^ as on June 212 Shareholding Details September 212 Background RDB Group entered the real estate residential development business in 1991 with RDB Realty and Infrastructure Ltd (RDBRIL) and is based in Kolkota. RDBRIL has a pan-india presence in Guwahati, Haldia, Kharagpur, New Delhi, Surat, Hyderabad and Jaipur. It has presence in the development of residential as well as commercial properties. The Company s prominent constructions include Regent Sonarpur, Regent Ganga and Regent Arcade among others. It has over 125 acres of Land Bank as on 31 st March, 212. Particulars Shareholding Nos. (%) Promoter & Promoter Group Holding 7,24,157 65.4 Total Institutional Holdings (FIIs & DIIs) 3,16,122 2.93 Public Holdings 34,59,721 32.3 Total 1,8,, 1. The Company entered into a joint venture with the Legend Group and formed a subsidiary company which at present develops projects having a total built-up area of 29 lac square feet in Hyderabad. RDBRIL has an ISO 91:28 certification and is a member of CREDAI Bengal. Strategy Focus The Company is diversifying its presence and has entered South India during FY 212 with the Hyderabad project. It is a Tier II and III cities focused players. The Company targets middle-lower income groups with an attractive price-value proposition. It focuses on transparency in its projects with clear title deeds, timely execution and fair agreements; translate into easy financing for the end-user to buy the property. It has also entered into Government projects since 27 to enhance revenue visibility and diversify its risk. Presently, the Company s revenue comprises a 7% share from its own projects and the rest from Government projects. Presently, along-with its subsidiaries RDBRIL has 2 ongoing projects at various stages of planning and development on the available land bank. This includes housing projects, integrated townships, shopping malls and commercial complexes. During FY 212, RDBRIL was awarded a tender to develop a Hostel Block at All-India Institute of Medical Sciences (AIIMS), Delhi. It also bagged the tender to develop a Hostel Block, at AIIMS, Bhubaneswar, a tender to develop a Hostel Block at Regional Institute of Medical Sciences (RIMS), Imphal and the tender to develop an OPD Block at RIMS, Imphal. During the year it completed Regent Square Project in Surat. The Company deliberately selected to remain cost-light and has not invested significantly in building land banks in the last few years. An Initiative of the BSE Investors Protection Fund 1

Financial Snapshot Consolidated Financials Particulars (Rs. In Million) Income Statement FY12 FY11 FY1 Net Sales / Income from Operations 1,38.6 994.9 825.3 Expenses Project / Production Charges 1,254.1 2,32. 885.1 Change in Inventories -189.9-1,32.8-187.8 Power & Fuel Cost.6 1.3.6 Employee Benefit Expenses 6.6 5.2 6.7 Administrative & Other Expenses 1,284.2 2,91.7 99.2 EBIDTA 279.1 199.5 96.6 Depreciation & Amortization 6.3 5.7 6.8 Finance Costs / Interest Expense 99.8 35.2 24.5 Other Income 9.3 7.3 22.8 Profit After Tax (PAT) 136.8 124.6 64.7 Key Ratios Income Statement EBIDTA Margin (%) 2.2 2.1 11.7 PAT Margins (%) 9.9 12.5 7.8 Balance Sheet Networth 88.9 767.5 644. Non Current Liabilities / Loan Funds 989.2 744. 252.9 Non Current Assets / Fixed Assets 53.3 71.9 8.4 Inventories 3,978.5 2,683.3 1,375.3 Debtors 314.7 143.1 29. Key Ratios Balance Sheet Debt : Equity (x).86.64.39 Book Value (BV) (in. Rs.) 81.6 71.1 1,73. Return on Capital Employed (ROCE) (%) 14.1 15.3 12.5 Return on Equity (ROE) (%) 13.6 15.9 1. Debtors Turnover (x) 6. 11.6 28.5 Inventory Turnover (x).4.5.6 Valuation Ratios P/E (x) 2. 5.4. P/BV (x).3.9. EV / EBITDA (x) 4.1 6.6. Source: Capitaline Database; Company Annual Report; as on 31 st March, 212 From the Research Desk of LKW s Gurukshetra.com The Company s turnover increased by 38.8% to Rs. 1,38.6 million in FY 212. During the year under review, your Company has executed and handed over Residential Projects covering an area of around 56,61 square feet and Commercial Projects covering an area of around 1,5, square feet resulting in aggregate completion of around 1,61,61 square feet. An Initiative of the BSE Investors Protection Fund 2

The Company s revenues are structured around the percentage completion method. The revenues are recognised in the books only after 2% of the project is completed. EBITDA stood at Rs. 279.1 million, a rise of 39.9% as Company delivered its projects during the year and a reduction in construction costs. The EBITDA Margins remained flat at 2.2% as compared to 2.1% in the last financial year. Profit after Tax stood at Rs. 136.8 million, reflecting a rise of 9.8%. The Interest expenses which stood at Rs. 99.8 million put significant pressure as it rose by 183.5%. Resultantly the corresponding margins declined by 262 basis points at 9.9% in FY 212. Notably, the Debt Equity Ratio is comfortable at.86(x) despite Loan funds witnessing a rise of 33% at Rs. 989.2 million. In the June 212 quarter of FY 213, the Company has reported Net Sales at Rs. 167.1 million, an increase of 37.9% as compared to the similar quarter of FY 212. Total Expenses rose sharply and EBITDA stood at Rs. 32.7 million. Net Profit for the quarter stood at Rs. 9.8 million. Performance on the Bourses 12 1 8 Stock Performance as on 5th November 212 % 6 4 2 - RDB Realty & Infra BSE Small Cap Peer Comparison The below mentioned table provides a snapshot of the financial performance of the company as compared to some of its peers in the Realty space and which have relatively larger scale of operations with a wider geographic presence. Particulars Standalone Financials (In Million) RDB Realty & Infra Orbit Corp Omaxe Net Sales 1,38.6 3,825.6 18,487.5 EBIDTA 279.1 1,498.4 2,346.2 PAT 136.8 137.2 93.8 EBIDTA Margins (%) 2.2 39.2 12.7 PAT Margins (%) 9.9 3.6 4.9 P/E (x)^ 2.2 134.7** 3. P/BV (x)^.4.6** 1.5 Debt : Equity (x).9.4.7 EV / EBITDA (x)^ 3.5 4.7** 14. Source: Capitaline Database, ^TTM as on June 212 on consolidated basis; ** as on September 212 An Initiative of the BSE Investors Protection Fund 3

About the Industry The Indian real estate market is expected to touch US$ 18 billion by 22 (CREDAI Confederation of Real Estate Developers Association of India) driven by demand from residential, commercial and retail real estate projects across India backed by increasing demand from smaller cities and increasing presence of foreign companies in India that are looking at India as a strategic market for expansion in business operations. Thus, the longer term prospects for the real estate sector in India are satisfactory. However, from a near to medium term perspective, high inflation and interest rates along with slow policy making and strained government finances have caused the Indian economy to grow at 5.3%, its lowest in nine years ( as per figures declared by the Government), thus affecting overall investment sentiment. Naturally, this has been reflected in the realty sector as demand for housing has slowed down and is now expected to grow at a lesser rate. As per the Company s Annual Report, over the next decade, the real estate sector is expected to grow by 3%. The sector is divided into four sub-sectors: housing, retail, hospitality, and commercial. The housing subsector contributes 5-6% to the country's gross domestic product (GDP). The real estate sector contributed only 5% of India's overall GDP in 211-12. The Indian real estate market size is expected to touch USD 18 billion by 22. India is going to produce an estimated two million new graduates from various Indian universities during this year, creating demand for 1 million square feet of office and industrial space Real estate demand in Tier-II and III towns and cities accelerated in line with the need for a better lifestyle. Cities like Bhopal, Bhubaneswar,Coimbatore, Indore, Jaipur, Lucknow, Surat, Vadodara and Visakhapatnam are expected to add over 354 million sq. ft of residential space in three years with sales expected to generate Rs.18 billion which augur well from the longer term growth prospects of the comapny. Outlook The outlook for the real estate sector during the second half of FY13 too is likely to remain negative given high construction costs, sluggish demand and liquidity pressures. The biggest deterrent for the real estate sector currently, is the high interest cost that has inflated the EMI s of home borrowers. This, together with high property prices and stubborn inflation will ensure demand is sluggish for the residential property segment. In the commercial and retail property space, the slowdown, subdued jobs growth particularly in the IT Sector and limited forward movement on Retail FDI are likely to impact the sector and also lead to higher leverage on the books of real estate companies. Companies such as RBDRIL which have a control over debt on the books and also the costs are more likely to benefit whenever there is overall uptick in economic reforms. An Initiative of the BSE Investors Protection Fund 4

Financial Graphs Net Income from Operations Rs. in Millions 16 14 12 1 8 6 4 2 138.6 994.9 825.3 FY 21 FY 211 FY 212 EBITDA & EBITDA Margins Rs. in Million 3 25 2 15 1 5 2.1 2.2 11.7 279.1 199.5 96.6 FY 21 FY 211 FY 212 25 2 15 1 5 % EBIDTA EBIDTA Margin (%) PAT & PAT Margins Rs. in Millions 16 14 12 1 8 6 4 2 12.5 9.9 7.8 124.6 136.8 64.7 FY 21 FY 211 FY 212 14 12 1 8 6 4 2 % PAT PAT Margins (%) An Initiative of the BSE Investors Protection Fund 5

Disclaimer All information contained in the document has been obtained by LKW s Gurukshetra.com from sources believed to be accurate and reliable. Although reasonable care has been taken to ensure that the information herein is true, such information is provided as is without any warranty of any kind, and LKW s Gurukshetra.com in particular makes no representation or warranty express or implied, as to the accuracy, timeliness or completeness of any such information. All information contained herein must be construed solely as statements of opinion, and LKW s Gurukshetra.com shall not be liable for any losses incurred by users from any use of this document or its contents in any manner. Opinions expressed in this document are not the opinions of our company and should not be construed as any indication of our recommendation to buy, sell or invest in the company under coverage. Disclosure Each member of the team involved in the preparation of this report, hereby affirms that there exists no conflict of interest. The report has been sponsored and published as part of Initiative of BSE s Investors Protection Fund About Us LOTUS KNOWLWEALTH (LKW), commenced business in 199 and is currently engaged in providing WEALTH ADVISORY, CORPORATE ADVISORY and ECONOMIC & FINANCIAL RESEARCH & CONTENT services. LKW s ECONOMIC & FINANCIAL RESEARCH & CONTENT division currently generates Reports on Economic & Industry Trends, Global & Indian Equity Markets, Fundamental Analysis of IPOs, Companies & Industries, Management Meeting Reports, Balance Sheet & Financial Analysis Reports and an Economic Political and Sentiment Barometer. LKW also conducts Capital Market related Training Programs and has cutting edge expertise in Mutual Fund Analysis and specializes in Grading of Mutual Fund Schemes and IPOs. GURUKSHETRA.com is an online initiative of LKW that focuses on Personal Finance while theipoguru.com is India s Premier Primary Market (IPO) Portal. Contact Us LOTUS KNOWLWEALTH Pvt. Ltd. Regd.Office : B Wing, 55-56, Fairlink Centre, Off Andheri Link Road, Andheri (W), Mumbai 4 53 Email : consulting@lotusknowlwealth.com Tel : 22-41 5482 41 5483 Website : www.lkwindia.com www.gurukshetra.com An Initiative of the BSE Investors Protection Fund 6