Stricly Private & Confidential

Dear Investors

We are pleased to bring to you this annual newsletter highlighting the Fund’s performance for Rakshat Kapoor
the year ended March 31st, 2022. CIO & Fund Manager
46.6
We launched our first Credit Fund in 2018-19 to prepare for an increased need for bespoke CIO
capital solutions in a dynamic and potentially less benign environment. Since then, we have Rakshat Kapoor has over 20 plus years
witnessed a debt crisis in India, been hit by the pandemic and are now hamstrung by inflation of experience in Private Credit. Prior to
and burgeoning asset prices. The ongoing war which is now in the 3rd month with no immediate Centrum Private Credit Fund, he was
signs of abatement has led to a very uncertain and turbulent geopolitical situation. But as Seth with Nomura Securities where he
Klarman puts it “Unprecedented events occur with some regularity, so be prepared”. As a result, worked in Private Credit, Debt Capital
we continue to be prudent in our approach and recalibrate our risk methodologies. Markets & Investment Banking
Divisions. Prior to that, he was with
Deutsche Bank’s structured credit
investments and ICICI Bank’s
Fund Performance structured finance team.
Key updates on our Fund performance are as follows:
 We have completed 3.5 years of the investment period and have made 13 investments till
date. The total invested capital is INR 1,440 crore across the Fund and Co-invested Capital
Fund Statistics as on Mar 31, 2022
 We have exited 8 of these investments, mostly before scheduled maturities validating the
First Close 30th Sep 2019
strength of our investment thesis and investment selection
Final Close 31st Mar 2022
 The underlying credit quality in the investment portfolio continues to be satisfactory so far
Gross Invested Capital 1,440
without any delays or delinquencies
Fund Investments* 517
 The Fund Level Gross IRR (internal rate of return) has been ~18% plus on a consistent Co-Investments 923
basis since inception Number of investments 13
Fund Gross IRR c.18%**

Fund Capital & Distribution Amounts in INR crore unless otherwise mentioned
* Includes reinvested capital
 We are pleased to share that in line with the past quarters, the Fund is making a distribution **The Fund Gross IRR is pre expenses (management
fees and operating expenses) and carried interest
payout of 7% for Q4FY22. The remittance will be made within May 2022
 We have announced the final close of the Fund on March 31 st, 2022 and have called for
drawdown of 100% of the capital commitments. We have a robust investment pipeline
spread across our target sectors, and are likely to have one or two more investments in
near term, or more investments should there be prepayments from the existing portfolio

Private Credit Opprtunity versus Macro Outlook

 The tenet of our investment strategy is to evaluate and identify key sectors that would benefit or are in line with the broader
macro economic outlook. We continue to believe sectors such as healthcare, pharma, packaging, logistics, specialty & agro
chemicals, and select domestic consumption themes, present attractive investment opportunities in the near term
 Interest Rates: The rate cycle is on the upward trajectory and we have begun to see the rate hikes across central banks. In
India, we are in a better position compared to other geographies as the quantum of liquidity infusion was well calibrated. The
current GSec10Y at ~7.43% is now marginally above pre pandemic levels. We are bearish here and feel that the further hikes
in interest rates which would adjust now for inflation should be another 75 bps to 100bps and the 10Y would see a level of
~8% in 12-18 months. Usually, the Private Credit segment, to some extent, is price inelastic but we are cognizant of the
interest rates cycle, phased withdrawal of liquidity and repricing of assets. Accordingly, our ongoing investments will be priced
by keeping in mind the upward bias in the rates trajectory
 Growth: The domestic economic indicators have started to show green shoots; increase in power consumption, steady
mobility trends, recovery in air traffic, people venturing out more etc. have ensured that the economy is heading steadily
towards pre-pandemic levels. Bank credit growth has also started to trend up. Further, Government initiatives on formalization
of economy, domestic manufacturing push, capex cycle etc will continue to be primary growth drivers. We are bullish on
overall growth and earnings. However, we feel that India will not be decoupled with global macro events and in near term,
will move in tandem
 Private Credits as an asset class will continue to outperform and will garner lot of investor interest. The capital requirements
for corporate India would see an increase arising out of both private and public capital expenditure plans and enhanced
working capital demand. The global macro challenges may exacerbate the near term opportunities in the Private Credit
segment
Thank you for your continuous support and we appreciate your investment in our investments. We welcome any questions, or
comments you might have. You may contact me directly at private.credit@centrum.co.in.

Sincerely,
Rakshat Kapoor, Fund Manager & CIO
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 Stricly Private & Confidential

Portfolio Summary

Investments Sector Fund % of Fund Co-invested Total

Investment Invested Capital Investment
(as on March Capital
31st, 2022)
Current Portfolio:
Zuari Agro Chemicals Limited Fertilizers 81 20% 9 90
Kalpataru Properties Private Limited Power Transmission 70 17% - 70
N D R Ware Housing Private Limited Logistics 68 1% 62 130
Wockhardt Limited Pharmaceuticals 61 15% 189 250
Sadbhav Engineering Limited Road EPC 53 13% 102 155
Invested AUM 333 362 695
Cash 80 19%
Exits:
Jana Holdings Limited – II Financial Services 40 - 40
Syska LED Lights (P) Limited Consumer Electrical 30 - 30
SSK Infotech Private Limited Consumer Electrical 38 102 140
Jana Holdings Limited – I Financial Services - 155 155
OPJ Trading (P) Limited Steel 31 69 100
DCW Limited Chemicals 42 108 150
Vishvaraj Environment (P) Limited Water Treatment 3 97 100
Zuari Global Limited Fertilizers - 30 30
Total Realised AUM 184 561 745

Gross AUM 517 923 1440

Amounts in INR crore

Distribution made since inception Sector wise investments breakup

S No. Distribution Distribution Amount

Rate (%) Payout Month (INR crore) Financial Services
1 7% Dec-21 6.21
8% Power Transmission
2 7% Sep-21 4.11 14% 5%
7%
3 7% Jun-21 3.38 Logistics
4 7% Apr-21 1.92 10% Pharmaceuticals
9%
5 7% Jan-21 1.80
7% Road EPC
6 7% Oct-20 1.46
7 7% Jun-20 1.34 17% Consumer Electrical
12%
8 7% Jan-20 0.80 11% Steel
9 7% Nov-19 0.15 Chemicals
Total 21.16

Note: 7% of capital commitments is paid each quarter Note: It includes all the 13 investments made till date

Gross AUM Movement (INR crore) Capital Returned (INR crore)

400

300 104
38
200
254 257
100
19
50
0
FY20 FY21 FY22
Principal Yield

Note: FY indicates period April-March Note: Capital returned (Principal + Yield)

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 Stricly Private & Confidential

Fund Compliances and Disclosures

This is in furtherance to the investor communication dated December 16, 2021. An update has been provided below:

1. Extension of timeline in the Final Close date from September 30, 2021 to March 31, 2022:
We are pleased to inform yourselves that this extension has helped the Fund raise an additional capital of INR 69.75 crores
during this extended period. The total commitments as on final close of the Fund on 31 st March 2022 is at INR 362.25
crores.

2. Management fee to be calculated on Invested Capital instead of Drawn down capital, starting from Q3FY22:
The Investment Manager continues to charge management fees only on the drawn down capital (including for Q3FY22
and Q4FY22). The requisite information on management fees pertaining to each contributor will be computed and disclosed
in the periodic Statements of Account and NAV computation.

3. Disclosure of Fees:
The Investment Manager and, or its associates (as defined under the AIF Regulations) may or has received upfront fees
or any income from the portfolio companies and such fees or income have mostly been used towards securing co-
investments or facilitating down-selling of securities. These co-investments have helped the Investment Manager to
originate high quality credit transactions of large size. The down selling securities have also helped the Fund to reduce its
exposure to individual deals and diversify the risk at the portfolio level.
The year wise details of such income & expenses of the Investment Manager and its associates are as mentioned as
below:
Table 1: Details of income & expenses related to co-investments (INR crore)

Particulars 31-Mar-20 31-Mar-21 31-Mar-22

Fund Investments outstanding as on date* 76.8 109.5 333.1
FY 20 FY 21 FY 22
Co-investments during the year 190.2 134.9 373.1
Fees received 6.06 5.27 10.22
Commissions Paid 4.38 1.51 6.65
Other Administrative & Selling Expenses 5.00 2.30 1.08
* This is as on the date and excludes cash & cash equivalents; Amount invested and excludes any yield therein

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 Stricly Private & Confidential

Sadbhav Engineering Limited

About the Company

Sadbhav Engineering Limited (“Company / SEL”) is an infrastructure EPC company with presence
Investment Dates
in road, mining and irrigation segments. Historically, it built good track record in project execution
February – July 2021
for over three decades and has strong technical execution capabilities. The Company through its
subsidiary, Sadbhav Infrastructure Projects Limited (“SIPL”), as on March 22 owns 4 operational
Build-Operate-Transfer (BOT) assets and 10 under construction Hybrid Annuity Model (HAM)
projects. Sector
Infrastructure;Road EPC
Credit Updates

SEL’s standalone revenue declined by 27.6% YoY to INR 866 crore in 9MFY22. This was primarily Investment Amount
NCD – INR 155 crore
due to (i) stagnant order book (ii) Covid-19 related challenges, (iii) negative cash flow generations
leading to overall liquidity issues and poor execution of the existing orders due to lack of adequate
working capital.
Stagnant and slow moving order book Total Tenor – 3 years

 Company has an order book position of INR 8,576 crore as on December 31, 2021. Average Maturity
However, a large proportion of the order book continues to remain slow moving; only 19% 30 months
and 9% of order book has been executed in FY21 and 9MFY22 respectively
 In the last 12 months, the Company has not won any new orders and the execution per day Repayment Type
has been c.INR 3-4 crore versus a daily execution INR 8-9 crore (FY20 daily execution Amortizing over the
average).. Tenor

Table 1 Order book breakup Key Security

As on 30th Sep 2021 As on 31st Dec 2021 % change  Exclusive mortgage
Segment Amount % of total Amount % total QOQ of commercial &
residential real estate
Roads 6,726 75.4% 6,447 75.2% -4.1% in Mumbai and
2,252 2,062 Ahmedabad, Gujarat.
BOT / HAM 25.3% 24.0% -8.4%
 Pledge over 3.80
EPC 4,473 50.2% 4,385 51.1% -2.0% crore equity shares
Irrigation 280 3.1% 243 2.8% -13.2% of Sadbhav
Mining 1,909 21.4% 1,885 22.0% -1.3% Infrastructure Private
Grand Total 8,915 100.0% 8,576 100.0% -3.8% Limited and 0.35
Note: Amount in INR crore, % total is % of total order book, Source: Company presentation crore equity shares
of Sadbhav
The orderbook primarily comprises projects from the road transport segment with National Engineering Limited
Highways Authority of India as the principal counterparty.
Current Exclusive
Stretched liquidity position despite raising substantial long-term funds Security Cover: 1x
(The stipulated cover is 1.5x;
 In 9MFY22, the group had raised around INR 991 crore through issuances of non-convertible however due to substantial fall in
stock prices of SEL and SIPL, the
debentures and sale of 7% of its Indinfravit Trust units. The proceeds were used for meeting cover has redcued to 1.0x as on
the pending equity commitments at SIPL and for meeting other pressing debt repayments March 31st, 2022)
 Further, the Company has also entered into a transaction to monetize Maharashtra Border
Check-post Network Limited (“MBCNL”) to the Adani Group (Adani Road Transport Limited),
for a consideration of ~ INR 500 crore. Out of this, INR 290 crore was received in February
2022 and the balance INR 210 crore is expected to be received in Q2FY23
 Sustained delay in scaling up of operations owing to a large proportion of slow-moving order
book, stretched current assets levels and cost over-run in ongoing Hybrid Annuity Model
(HAM) projects have outweighed the fund-raising benefits resulting in stretched liquidity
position
 Slower execution and low growth in order book can be partially attributed to the fact that the
focus of the Company management is on asset monetization and resolution of the terminated
projects

Events based cash flows to provide support to the group

 The group is planning to monetize Ahmedabad Ring Road Infrastructure Limited (ARRIL) and
three of its 3 HAM projects during FY23. The cash generation is expected to deleverage the
balance sheet and provide cash for operations
 Sadbhav group has started commercial operations for 5 of its 10 hybrid annuity model (HAM)
projects and two more projects are likely to commence operations in Q2FY23. This may also
be monetized in near future

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 Stricly Private & Confidential

 Further, the group has entered into definitive agreements with Gawar Constructions Limited
(GCL; rated CARE AA-; Stable/ CARE A1+), either as a sponsor or as a contractor, to ramp
up the execution of the remaining three HAM assets. This should help in timely completion of
the projects.

Financial Snapshot of SEL

Standalone Consolidated
INR crore 9MFY21 9MFY22 9MFY21 9MFY22
Income Statement
Revenue from operations 1,197 866 1,620 1,250
YoY (%) -28.1% -23.1%
Construction Expense 938 668 998 750
Gross Profit 259 198 622 500
Margin (%) 21.6% 22.8% 38.3% 40.0%

Employee cost 87 68 110 90

Other Expenses 28 26 58 61
EBIDTA 144 104 454 349
Margin (%) 12.0% 12.0% 28.0% 27.9%

Depreciation 72 55 168 117

EBIT 72 49 286 232

Finance cost 139 134 737 675

Other income 58 71 246 304
Exceptional (loss) / profit - -6 - -82

Profit before tax -9 -20 -205 -221

Profit after tax -6 -15 -225 -206

% margin -0.5% -1.7% -13.8% -16.4%

Detailed Terms & Conditions

Issued amount INR 155 crore

CCOF – INR 53 crore
Current Holding
Co Investors – INR 102 crore

Months from disbursement Repayment %

September 15th 2022 15%
Scheduled March 15th 2023 20%
repayment September 15th 2023 30%
At the end of 36th month 35%

30th September 2022

Put / Call Option
We envisage, the Company will not be able to exercise the PUT option on 30th
September 2022 and will redeem the NCD as per the redemption schedule
The NCDs are secured by:
(i) Exclusive mortgage over commercial & residential real estate in
Mumbai and Ahmedabad, Gujarat (“Real Estate Security”);
Security (ii) Pledge over 3.80 crore shares of SIPL
(iii) Pledge over 0.35 crore shares of SEL
(iv) Residual charge over the current assets and movable fixed assets
of the Issuer;
(v) Personal Guarantees from Promoters
Security Details Value
(INR crores)
(i) Real Estate Security 110
(ii) Sadbhav Infrastructure equity shares (3.81 crore 34
shares at INR 9 price as on 31st March 2022)
(iii) Sadbhav Engineering equity shares (0.35 crore 9
Security value
shares at INR 26 price as on 31st March 2022)
(iv) Residual value of current assets 179
Total Security 332

Total value of Exclusive Security 153

Exclusive Security cover 1.0x
Page 5 of 17
 Stricly Private & Confidential

(i) All coupon payments due in FY22 (15 th June 2021, 15th September 2021,
15th Dec 2021 and 15th March 2022) have been paid on schedule dates
(ii) TDS and return filing has been done for Q1 and Q2 FY22. As on date, TDS
Credit Conditions for Q3 and Q4 is yet to be deposited.
& Compliances (iii) SEL was to ensure that its credit rating does not fall below “A-” by India
Ratings and “BBB+” by Care Ratings. The current rating of SEL is BBB+ by
India Ratings and CARE has rated BB+ and withdrawn the rating.

Stock Price movement of SEL and SIPL

100
90
80
70
60
50
40
30
20
10
0

SEL SIPL

Key Concerns and monitorables

 Steady decline in revenue from operations

 Lack of new orders since January 2021; slow execution of existing order book and delays in
project execution
 Stretched liquidity on account of elevated receivables under the HAM and EPC projects
 Monetisations timelines:
- Sale of operational BOT asset - Ahmedabad Ring Road Infrastructure Ltd (ARRIL)
- Sale of 3 operational HAM assets - Rudrapur, Bhavnagar, Udaipur
- Reciept of balance amount from stake sale of MBCNL

Fructification of above plans over INR 750 crore (monetization of MBCNL, ARRIL and 3 HAM
SPV’s) leading to substantial debt rationalisation and improvement in the liquidity on sustained
basis will be a key monitorable

Our view

 The operational turnaround in the operating and financial metrics is taking longer time to
turnaround. This investment is under watch and we remain cautious.

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 Stricly Private & Confidential

Wockhardt Limited

About the Company

Wockhardt Limited (“Company”) is an established Indian pharmaceutical and biotechnology Investment Date
company. The main business operations comprise developing, manufacturing and marketing April – May 2021
of finished dosage and biopharmaceutical formulations, active pharmaceutical ingredients
(APIs) and vaccines. It has capabilities to produce sterile (injectable), biopharmaceuticals, Sector
orals (tablets and liquids), topicals (creams and ointments) for both exports as well as Pharamceuticals
domestic markets.
Investment Amount
NCD – INR 250 crore
Credit Updates
Total Tenor
Healthy revenue growth registered over 9 months of FY22 driven primarily by growth
3 years
in India business and UK vaccination orders

Revenues registered a 21% yoy growth over 9MFY22 for Wockhardt Limited (“the Company”) Average Maturity
2.5 years
driven primarily by the growth in India chronic business and UK vaccine business of the
company. Repayment Type
The chronic segment drove the growth in the India business. Sales from India vaccine Amortizing
business (Sputnik V) are yet to take-off and sales from the same should add further to Security
revenues.  Exclusive charge
Orders from the UK government for COVID-19 vaccines led to growth in UK business, along over shares of
Wockhardt Limited,
with the resumption of the non-vaccine business, which were closer to pre-pandemic levels.
and
Revenues remained flat QoQ as moderate declines in India and UK business in Q3FY22 were  Pari passu charge
compensated by a strong performance in emerging markets, which had seen a few lacklustre over Fixed assets of
the company
quarters and strong turnaround in US business post management revamp.
Chart 1 Quarterly sales break up by geography
Security Cover: 2x
Geography wise sales
1,000
900
800
Revenue (INR cr)

700
600
500
400
300
200
100
-

India Emerging Markets EU (non-vaccine) EU (UK vaccine) US

Tie-up with Enso Healthcare for manufacturing of Sputnik vaccine

The Company has entered into a contract with Enso Healthcare (Russian Direct Investment
Fund’s coordination partner for sourcing Sputnik vaccine in India) and a subsidiary of Russian
Direct Investment Fund for manufacturing and supply of 620 million doses of Sputnik V and
the Sputnik Light vaccines. As per this order, the Company has to provide 70-120 million
doses by June 2022 and has the option to enter an agreement to supply an additional 500
million doses subsequently. The Company now expects offtakes to take place from Q3 FY23.
However, actual order offtakes and receipt of payments against the same will remain a key
monitorable.
Long-term tie-up with Serum Institute for production of Serum’s vaccines in UK

The Company announced a 15-year tie up with Serum Institute’s UK subsidiary to

manufacture multiple vaccines in the UK, at its UK facility on a fill and finish basis. Wockhardt
would deliver around 150 million additional vaccines every year from this facility on a profit
sharing arrangement between the two.

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 Stricly Private & Confidential

Table 1 Financial Performance Summary

FY20 FY21 9M FY21 9M FY22

Revenue from operations 3,325 2,762 2,130 2,575
Raw material consumption 1,321 1,135 835 990
Gross Margins 2,004 1,627 1,295 1,585
Gross Margin% 60% 59% 61% 62%

Staff Cost 773 711 566 522

R&D expenses 208 172 124 117
Other expenses 779 730 572 616

EBITDA 244 14 33 330

Margin % 7% 0% 2% 13%

EBITDA before R&D 452 186 157 447

Margin % 14% 7% 7% 17%

Depreciation 226 246 181 188

Other income 60 79 128 12

EBIT (42) (311) (26) 148

Interest expense 276 249 194 213

Exceptional items - 1328 1328 -

Profit Before Tax (318) 768 1,108 (65)

Tax Expense (153) 228 299 (96)
Profit After Tax (164) 540 809 31
*Calculated based on published figures

Healthy profitability driven by higher revenues and gross margins

During 9MFY22, there has been a significant improvement in profitability over the corresponding
previous. Higher volumes in India and higher sales from UK vaccine business, which is a very
high margin business, led to higher gross margins.Constant overhead costs combined with
higher sales led to higher operating profitability on account of high operating leverage in the
business.

However, higher interest costs resulted in a negative PAT for the company for 9MFY22. Net
losses reduced significantly over 9MFY21 indicating an ongoing turnaround in business
performance. Offtake of Sputnik vaccine manufacturing in India and performance of UK
business post completion of contract to manufacture Covid-19 vaccine will remain a key
monitorable determining profitability going forward.

Successful rights issue in Q4FY22 to help further deleverage balance sheet

Total debt was stable between March and September 2021, despite healthy cashflow from
operations, which was used for capex and expenditure for the vaccine project. There has been
a significant reduction in external debt over the last couple of years through scheduled
maturities.

Chart 2 Movement in term debt from external lenders (excludes sub-debt)

4000
Term Debt (INR crore)
3000

2000

1000

0
Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 Sep-21 Dec-21

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 Stricly Private & Confidential

The company has also successfully raised INR 748 crore through a rights issue, wherein shares
were allotted at INR 225, at significant discount to the prevailing market prices. The proceeds
of the rights issue will be used towards partrepayment of subordinated debt (from promoters)
and towards funding R&D expenditure. Part repayment of subordinated debt would improve the
bottom line by reducing interest expense.

Our view

 The delay in off take of the Sputnik vaccine business (inherently a high margin business)
might put pressure on the margins
 The Company has already incurred capex for the vaccine project and any delay in revenue
generation will impact the debt coverage metrics, thereby exposing the company to refinance
risk
 The recently concluded rights issue will help the company deleverage to some extent and
provide working capital which is credit positive

Detailed Terms & Conditions

Issued amount INR 250 crore (in four tranches)

CCOF – INR 61 crore
Current Holding
Co Investors – INR 189 crore

Tranche I (INR Tranche II (INR Tranche III (INR Tranche IV (INR

75 crore) 75 crore) 50 crore) 50 crore)
Scheduled Month % Month % Month % Month %
redemption Jun’23 33% Jun’23 33% Jun’23 33% Dec’23 33%
Dec’23 33% Dec’23 33% Dec’23 33% Jun’24 33%
Apr’24 34% May’24 34% May’24 34% Oct’24 34%

The NCDs are secured by:

(i) 1.0x cover through the shares of Wockhardt Limited
(ii) 1.0x cover through pari-passu charge over Fixed Assets of the issuer
(iii) DSRA for one quarter of coupon
(iv) Exclsuive charge over the subscription escrow account

Security Until the 1.0x security cover through pari-passu charge over fixed assets
is not perfected, 1.0x security cover will be provided by equity shares of
Wockhardt Limited. This 1.0x will be released within 2 days once the
charge over fixed assets is perfected.

Note: As all the NOCs of existing lenders haven’t been received, we

continue to have 2.0x cover through share pledge.

(i) All coupon payments have been paid as per schecule

Compliances (ii) Due to the recent volatility in the markets, there have been multiple
triggers for share top-ups. The Company has been generally compliant on
all such occasions

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NDR Warehousing Private Limited

About the Company

NDR Warehousing Private Limited (“Company”) is engaged in the business of building

warehouses and providing warehousing space on rental basis. Majority of the warehouses Investment Date
built by the company are Grade A warehouses and carries a mix of built to suit, storages and October - December 2021
industrials warehouses. Total leasable area under the company is ~10 msft and with an
Sector
occupancy of more than 99%. The company establishes warehouses through a mix of wholly
Logistics
owned assets and through a set of JVs/ partnership.
Investment Amount
Credit Updates OCD – INR 130 crore

Monthly rental (LHS) Area Leased (RHS) Average Maturity

36 months
16.00 10.00
15.50 9.80 Repayment Type
15.00 9.60 Amortizing
(INR crore)

(mn sft)
14.50 9.40
14.00 9.20 Key Security
13.50 9.00
13.00 8.80  Pledge over shares
12.50 8.60 of NDR Plantations
12.00 8.40 Private Limited
 Corporate Guarantee
from NDR Plantations
Private Limited

Diversified Portfolio – Location and Tenant Breakdown as of 31st March 2022

Pondicherry Aurangabad
Mumbai (West) (South) (West)
11% 1% 2% Bangalore Security Cover
(South)
Kolkata (East) 9% Total Security
3%
Cover – 2.00x

Gurgaon (North)
7%

Coimbatore
(South)
18% Chennai (South)
49%

IT/ITES Steel
FMCG 3% 1%
4% Retail
3%
Automobile
5%
3PL
E Commerce 45%
17%

CFS
10% Textile
12%

 The Company’s area under lease has gradually increased over the last few months
driven by operationalization of a few new warehouses leased out to Amazon, Croma,
Lifestyle, etc. Improvement in revenues were also achieved as a result of better
utilization of space, including usage of common areas and open spaces
 Recently, the company has incrementaly signed up new LOIs with clients such as
Flipkart (0.6 mn sqft in Kolkata) and Reliance (0.02 mn sqft in New Delhi). The tenor
of the leases is ~15 years

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 Investcorp has invested USD 20 mn as structured equity in the company in January

and February 2022, which has been used towards acquisition of new land parcels
and repayment of existing debt of INR 55 crore from one of the existing lenders
Investment Rationale

 Strong sector outlook

- Strong demand outlook for the warehousing segment driven by increased
penetration of e-commerce and consumer goods
- Consolidation in the segment post introduction of GST
 Strong investor interest
- Sector has seen strong interest from global institutional players like Blackstone,
CPPIB, ESR, Allianz, Capitaland, etc.
- Preferable model for institutional investors has been to partner with local
players to create platform
 Successful track record of promoters in warehousing business
- Track record of promoters of building Continental Warehousing business from
scratch, bringing in global private equity partners and successful exit to DP
World/ NIIF
- Strong track record of the promoter in warehousing business, in delivering 9.5
mn sft of warehousing space, low cost of delivery, long term leases for existing
spaces with marquee clients such as Reliance,
Mahindra Logistics, Lifestyle, Amazon etc.
 Clear opportunities to exit
- Track record of successful REIT/ InVIT launches by other players. NDRWH also
has investment from Investcorp – a global private equity, which will help the
company grow and get listed in REIT/ InVIT
- Once the company completes its projects, it can avail top ups by refinancing
existing construction loans through lease rental discounting
Outlook

 The company has plans to ramp up its current capacity from ~10 m sft to around 19.5
m sft over the next 2 years (FY23 and FY24). Once complete, it would be one of the
top five warehousing platforms in India and would get the assets listed through a
REIT/ InVIT listing in the stock exchanges.
 Consolidated portfolio rentals expected to increase from ~INR 180 Crore (basis
current monthly rental run rate of ~ INR 15 Crore) to ~INR 434 Crore by FY25

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Kalpataru Properties Private Limited

About the Group

Kalpataru Group was established in 1969 and is a diversified conglomerate with interest in Real
Estate, Power Transmission, and EPC in major infrastructure segments like Power
Transmission and Distribution, Buildings & Factories, Roads & Highways, Water & Irrigation,
Railways and Oil and Gas. Investment Date
December- January 2022
Kalpataru Power Transmission Limited (KPTL) is amongst the leading Engineering,
Procurement, and Construction (EPC) companies with over four decades of operations. KPTL
delivers complete solutions covering design, testing, fabrication, erection and construction of
transmission lines, oil and gas infrastructure and railways projects on a turnkey basis. KPTL Sector
has established its footprints in 63 countries spread across five continents. Power Transmission

Kalpataru Ltd and Kalpataru Properties Private Limited are the flagship entities of the real estate
arm of the Kalpataru Group. Investment Amount
NCD - INR 70 crore
The group is amongst the leading real estate developers in MMR with a presence across
segments like premium residential, commercial, retail, integrated townships, lifestyle gated
communities and redevelopment projects primarily in the Mumbai Metropolitan Region (MMR)
and Pune. Average Maturity
36 months
The Fund has made investment in NCDs issued by Kalpataru Properties Private Limited. The
proceeds were used for capitalization of various businesses in the group and long term working
capital purposes and repayment of existing debt in group. Repayment Type
Amortizing over the
Tenor

Credit Updates Key Security

Exclusive Pledge
Merger of KPTL with JMC Project to create synergy over shares of KPTL

The board of Kalpataru Power Transmission Ltd approved merger of JMC Project (subsidiary)
with KPTK (all equity merger) in 4:1 ratio. This merger will create an EPC company having a
global footprint that caters to various sectors such as Power Transmission, Building & Factories
(B&F), Railways, Oil &Gas, Water, Urban Infra and Heavy Civil.
Strong order book and strategic diversification: Combined entity has an order book in excess
of INR 370 BN including L1 as on Q3FY22 (of which T&D accounts for 24%, B&F 30%, Railways
10%, O&G 6% and Water 30%) providing revenue visibility for FY23 and FY24. The merger will
enhance KPTL’s portfolio, while JMC will be able to leverage KPTL’s expertise, global business
access and financial flexibility to expand the business and bid for large-size infrastructure
projects. Exclusive Security
Cover: 1.75x
Synergy in operations: The combined entity will be able to drive a lot of operational synergies,
cost reduction and scale effectiveness in areas like procurement, supply chain and technology.
Merger will enable overhead cost reduction to tune of INR 1BN as represented by KPTL
management.
Financial benefits: Diversified business portfolio with several high growth businesses such as
T&D, B&F, water, railways, O&G pipeline and urban infra, provides stable order inflow and
revenue visibility going forward. Increased net worth will enable the company to bid for larger
and complex infrastructure projects, thereby driving order book growth. Additionally, strong
balance sheet provides potential to optimize liquidity and reduce cost of financing

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Financial snapshot of KPTL

Standalone Consolidated
INR crore 9MFY21 9MFY22 9MFY21 9MFY22
Income Statement
Revenue from operations 5,334 5,052 8,863 10,642
YOY (%)
Construction Expense 3,836 3,717 6,326 7,858
Gross Profit 1,498 1,335 2,537 2,784
Margin (%) 28.0% 26.4% 28.6% 26.1%

Employee cost 420 377 756 950

Other Expenses 513 476 725 937
EBIDTA 565 482 1,056 897
Margin (%) 10.5% 9.5% 11.9% 8.4%

Depreciation 87 79 289 270

EBIT 478 403 767 657

Finance cost 81 94 340 298

Other income 65 62 49 55
Exceptional (loss) / profit 168 217 210 185

Profit before tax 630 588 662 539

Profit after tax 485 428 475 420

% margin 1% 8.4% 5.3% 3.9%

Investment Rationale

 Pedigreed and reputed group: Kalpataru group has been in various businesses for more
than four decades and is a well-established and a diversified corporate. Transaction
structure: The NCD facility is secured by exclusive pledge over the shares of KPTL which
is rated CRISIL AA and has a strong credit profile
 KPTL is one of the leading players in this space, with reputed customers such as Power
Grid Corporation of India Ltd (‘CRISIL AAA/FAAA/Stable/CRISIL A1+’) and various state
transmission utilities. Order book of INR 31,000 crore at consolidated level as on September
30, 2021, provides strong revenue visibility over the medium term.

 Diversified revenue: While the flagship company, KPTL, contributes 67% to total revenue;
32% comes from JMC, which executes projects in the infrastructure, industrial and
commercial building, railway, and road segments. The balance 1% of consolidated revenue
primarily comes from SSL, which provides warehousing and logistics services. About 27%
of the total unexecuted orders are from the international market. Exports are primarily to
countries in Asia, Africa, Central and Latin America, the Middle East, Australia, and Europe.
Diversified revenue streams help reduce susceptibility to downturns in any one business.
Outlook on KPTL

 The operations are doing well with robust order inflow. This gives good revenue visibility
and with sustained improvement in operating margin, cash generation will be higher which
should further reduce debt
 Divestment of its non-core assets i.e T&D BOT assets, Real Estate Project will help to further
delever the balance sheet

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Jana Holdings Limited - Exited

Investment Description

Jana Holdings Limited (“Company/JHL”) is a non-operative financial holding company which

owns 42.8% stake in Jana Small Finance Bank. The company is a wholly owned subsidiary of Investment Date
Jana Capital Limited, the primary holding company of Jana Small Finance Bank. Jana Capital January 2022
is backed by Ramesh Ramanathan (through Jana Urban Foundation) and marquee private
equity players like TPG Capital, GIC, Morgan Stanley Private Equity, and some private
investors. Going forward, JHL will be merged with JCL.
Sector
Jana Small Finance Bank is one of the leading small finance banks in India with a loan book of Financial Services
INR 13,912 crore, of which around 45% is secured. The bank has presence across 22 states
and has a deposit base of INR 12,771 crore. Jana Small Finance Bank has already filed the
draft red herring prospectus for an initial publc offer and is likely to get listed in the stock
Investment Amount
exchanges in the next 6-12 months. NCD – INR 40 crore
Investment Rationale

 Strong backing by marquee private equity players – Jana Small Finance Bank is
backed by marquee private equity like TPG, GIC, Morgan Stanley, Harborvest and many Average Maturity
other large investors. These private equity funds own stake both in the bank as well as in 27 months; prepaid in
JCL. The bank has a strong board of directors. The shareholders have demonstrated their March 2022
support to the business repeatedly by infusing capital across the bank and the holding
companies.
 Short term special situation opportunity – JHL had raised debt through NCDs in 2018, Repayment Type
part of which (INR 155 crore face value, INR 245 crore maturity value) has matured recently Bullet at maturity
and JHL has refinanced the same through debt raised from new and existing investors.
The Fund has invested in INR 40 crore in the aforementioned issuance.
The company is already in discussions for a large fund raise from a strategic investor to Key Security
refinance the outstanding debt. Hence, the Fund has investred in this transaction purely as  Pledge over shares of
Jana Small Finance
a short term special situation investment.
Bank
 Transaction structure – The NCDs are secured by a fixed number of shares of Jana Small  Pledge over shares of
Finance Bank and Jana Capital Limited Jana Capital Limited

Outlook

 The bank has been growing its loan book very cautiously reflected in the healthy asset
quality and increasing share of secured assets. The loan growth moderated in FY21 on
account of the company taking a conservative approach in wake of COVID-19
 The bank has already filed its draft red herring prospectus and is expected to get listed
soon
Credit Update

 The investment was prepaid by the Issuer on March 28, 2022

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Zuari Agrochemicals Private Limited

About Adventz Group

The Adventz Group is into multiple businesses ranging from fertilizers, engineering, real estate
and sugar. Zuari Global Limited (“ZGL”) is the holding company of Adventz Group.
Zuari Agrochemicals Private Limited (“ZACL”) through its subsidiaries and joint ventures is
engaged in manufacturing of fertilizers, seeds, and other agri-inputs. ZACL is engaged in
Investment Date
manufacturing of urea as well as DAP/NPK fertilizers at its Goa manufacturing facility along
February- April 2022
with water soluble fertilizers (WSF) and Single Super Phosphate (SSP) manufactured at other
plants of the company.
Sector
The Fund has invested in NCDs issued by Zuari Agrochemicals Private Limited. The proceeds Fertilizer
were used for repayment of existing debt and align the debt repayment as per cash flows.
Investment Rationale
Investment
 Positive Sector Outlook: Amount

 Indian soil remains deficient in nutrient content, which has resulted in lower agri- NCD (till March 31st,
productivity. With increasing population, the demand for food will increase which will 2022) INR 90 crore
make productivity improvement imperative for the agri sector. Thus, the demand
outlook for fertilizers remains positive in India
 There has been a significant uptick in this sector largely driven by GoI policymaking.
Reduction towards import of Ammonia, Urea and facilitating has resulted in anincrease Average Maturity
in domestic manufacturing in these products. With the Urea self-sufficiency plan of GoI 36 months
by 2023, India will become self-sufficient in Urea with negligible or no imports.
However, ample opportunities will be available for the industry for non-Urea fertilisers Coupon Frequency:
like DAP and other Complex fertilisers. GoI is also providing impetus on balanced use Annual
of fertilizers which is expected to give rise in the demand of DAP and other complex
fertilizers and result in reduction in the demand of Urea
 Transaction structure: The NCD facility is secured by exclusive pledge over the Repayment Type
shares of MCFL which is rated CARE BBB+ and has a strong credit profile Amortizing over the
Tenor
 Established position and wide customer base: MCFL is one of the leading companies
catering to the fertilizer markets in Southern India. About 72% of MCFL’s products Key Security
are sold in the state of Karnataka, which meets about 11% of the needs of the  Pledge over
farmers in the state. MCFL also maintains good market share in Kerala and a modest shares of MCFL
share in neighboring states of Tamil Nadu, Andhra Pradesh, Telangana and
Maharashtra.
 MCFL is an integrated manufacturer and trader of fertilizers, with manufacturing
facility at Panambur, Mangalore, and Karnataka. The plant is located at Mangalore
West Coast, close to Mangalore port. The total installed capacity is 6.815 lac MT with Exclusive
key products being urea, NPK and other complex fertilizers. The main products are Security Cover:
urea, di ammonium phosphate (DAP), NP, muriate of potash (MOP), speciality 2.00x
fertilizers consisting of water soluble fertilizers and micronutrients, plant nutrition
products such as soil conditioners and industrial products, viz., ammonium bi-
carbonate, sulfonated naphthalene formaldehyde, etc.
 Higher operational efficiency and EBITDA: (i) post conversion of plant from Naptha
to Gas. (ii) Energy Improvement Project (EIP) to further improve efficiency, leading
to better margins
 The above improvement in energy consumption is expected to add incremental ~INR
150-180 crore/pa in EBITDA from Urea manufacturing till December 14, 2025
 Favourable Government policies augurs well: Fertilizer industry is highly regulated
and with an aim to boost investments, GoI has initiated policy steps that could
structurally improve fertiliser industry’s dynamics with schemes like gas price
pooling, DBT, NPS III, Modified NPS III, New Investment Policy, and New Urea
policy.
 Payable of subsidy by GoI in a timely manner results in significant reduction of
working capital cycle and thus can improve the profitability of MCFL

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Financial snapshot of ZACL and MCFL

Standalone- ZACL Standalone - MCFL

INR crore 9MFY21 9MFY22 9MFY21 9MFY22
Income Statement
Revenue from operations 0.11 57.25 1,545 2,176
YOY (%)
Cost of Raw Material 0.10 50.27 1,016 1,360
Gross Profit 0.01 6.98 529 816
Margin (%) 9.09% 12.1% 34.2% 37.5%

Employee cost 3.51 1.97 53 53

Other Expenses 17.67 11.55 317 575
EBIDTA (21.17) (6.54) 159 188
Margin (%) NA NA 10.2% 8.6%

Depreciation 2.79 2.65 34 38

EBIT (23.96) (9.19) 125 150

Finance cost 101.42 90.23 65 33

Other income 23.91 26.75 22 16
Exceptional (loss) / profit - - - -

Profit before tax (101.47) (72.67) 82 133

Profit after tax (101.47) (72.67) 52 84

% margin NA NA 3.3% 3.8%

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Disclaimer:
This document has been prepared for general information only and should not be construed as an offer or solicitation of an offer or advice for
purchase of any units/ securities/ instruments/ products or any other financial products. The information and statistical data contained herein is
proprietary or extracted from publicly available information or other sources which are believed to be reliable, but in no way warrants to its accuracy
or completeness. Market views/ outlook (if any) expressed herein are for general information only and do not have regards to any specific
investment objectives, financial situation and the particular needs of any specific person who may have received this information. It should not be
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development or implementation of any strategy. Recipients of this document / information must rely upon its/ his/ her own representatives, including
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