Birla Real Estate Investor Presentation

Real(i)ty - Indian Real Estate, back on track
Birla Sun Life Asset Management Company Ltd.
Copyright: Birla Sun Life Asset Management Company Ltd. 2009

Real Estate – Emerging steadily from the slump
The REAL ESTATE journey
Glory Despair Recovery
2006-07 2007 -08 2008 -09 2009 -10
 High liquidity at  Rise in  Depressed

low rates mortgage rates demand, low
sales
 Highest levels  Rise in prices  Enough signs of easing
of land buying due to over  Lack of trust
liquidity
recorded supply about pricing
and delivery of  Increase in off take with
projects stability appearing in prices
After a course correction, Back on track
Birla Sun Life Asset Management Company Ltd. 2

Real estate growth –
expected at a CAGR of 26% till 2014
Estimated Real estate market size – 2009-2014 Sector wise demand projections – 2009-2013
6,90,000 room nights
Hospitality 10 20 20 26 24
7.5 million units
Residential 17 18 20 23 22
>43 million sq. feet
Retail 15 17 19 26 23
> 196 million sq. feet
Office 15 10 25 25 25
0% 20% 40% 60% 80% 100%

2009 2010 2011 2012 2013
Research and markets Cushman and Weikfeild 2009 report
 Current property prices present a great opportunity to investors. A peak is expected in the next 3~5
years making real estate an attractive investment option.
 The residential segment will lead the sector’s recovery:
 New players are expected to enter the market with properties designed keeping in mind
current economic conditions and consumer preferences
 Focus of real estate developers is the affordable housing segment which makes up 50% of
the total market currently.
Business Standard

The best time to invest in this asset class
Indian Real Estate Index – 2009

• Evident signs of increasing investment activity in
the real estate sector
• USD 15 billion, the sum raised by real estate firms
in the past six months through QIP’s.
• 20 -25, the expected number of IPO’s from real
estate firms in the forthcoming six months.
• Emmar, Godrej properties, DB realty together plan
to raise USD 1.8 billion through IPO’s.
• Unitech and DLF, the top two of the ten firms
receiving maximum FII in the Q2 2009.
Source: BSE India Website
FDI Inflow Cumulative

2006-07 2007-08 2008-09 2009 -10 (E)
(USD million) (2006 – 2009)
Housing and real estate 467 2179 2801 1181 6628
Source: Cushman and Wakefield 2009 report
India tops the BRIC nations Real Estate Transparency Index says Jones Lang LaSalle as per
their 2008 report. Investors looking at India as a long term investment destination can be confident

Residential realty – The juicy bit

Residential realty demand pegged at
7.5 million homes by 2013
• Demand for residential realty to reach 7.5 Residential Real Estate Demand - in units
million units by 2013*. (2009-13)
• Highest cumulative demand will be seen by

Mumbai (1.6 million units). Bangalore and
Hyderabad to witness highest CAGR at 14%.
• Urbanization, development of city suburbs,

increasing nuclear families and rising income
levels to be the key demand drivers
• Prize rationalization, reduced costs of

borrowing, government sops etc. and,
increasing focus on affordable housing all
contributing to renewed demand. Most
developers are increasing their portfolio to
include affordable housing
Source: Cushman and Wakefield, September 2009
* September 2009 report

Your best bet to Gain – The ADITYA BIRLA group

Your Partner in Value Creation –
The Aditya Birla Group
One of India’s Employs More

Global Turnover of Fortune 500 Presence in 25
Oldest Business Than 100,000
USD 28 billion Company Countries
Houses People
Has a Dedicated Presence in

Leadership across Joint Venture with Awarded India’s
Financial Services Insurance, Asset
businesses Sun Life Best Employer
Group Mgt., MFs

Birla Sun Life Asset Management Co.
A JV between two stalwarts
Birla Sun
Life Asset
Management
Company
A Joint Venture between the Investment manager of one An amalgam of Aditya Birla
Aditya Birla Group and of the India's leading Group’s strengths in
Sun Life Financial Mutual Funds - Birla Sun the Indian Market and, Sun
Services Inc. of Canada Life Mutual Fund Life's global experience

One of the best teams in the industry (1/2)
Shashi Kumar,
Head Real Estate
 Alumnus of one of India’s leading B-schools

 Experience of 18 years in Business; 10 years in
Indian Realty and related businesses
 Founder member of India REIT as Chief
Investment Officer (Ajay Piramal group RE Fund)
 Has successfully completed an investment cycle –
Fund raising – Deployment – Exit
 Managed funds – Domestic: INR 10 billion;
Offshore: INR 25 billion
 Headed Real Estate expansion at Shoppers Stop
and related business at Landmark, India REIT and
now, Birla Sun Life AMC

One of the best teams in the industry (2/2)
Shekhar Rangaraj, Head

Jagannath Shetty, CFO
Business Development
 Chartered Accountant with 20 years  More than 20 years of experience in

experience Business Development and Channel
Management
 15 years in Lupin Group in Corporate
Finance, Projects, Mergers and  10 years of international exposure of
Acquisitions with global exposure, dealing with luxury brands
reporting to Head Finance
 Instrumental in launching the Indian
 Deputed to group’s Real Estate sojourn of renowned luxury brands
business for 6 years, heading Finance and enlightening them on the Indian
and Legal functions with exposure to consumer psyche
evaluation and negotiation
 Well exposed to dealing with HNI’s
 Wide experience in deal structuring,
due diligence, closing and post
closing compliance and integration

Primary focus: Mitigating risk exposure and…
Principles for Investments
To maximise value for

Investment focus on Invest in mid-tier
investors, investments to
residential realty, the developers’ top-grade
be milestone/target
most attractive segment projects
oriented
Caps on Exposure to Limit Risks:

 Single Project: 15%
 Overall exposure in a single group: 30%
Guidelines for  Single City (Metros): 50%
Investments  Non metros: 30%
 Yield based investments: 15%
Above caps to be reviewed periodically by Investment Committee

…spreading our investments evenly.
Location Focus on the highest potential geographies
High potential cities such Secondary focus will be on

Primary Secondary
as Mumbai Bangalore, cities such as NCR region
Focus Focus
Chennai, Hyderabad and and Kolkata
Pune
Investment Strategy: Focus on Residential Realty
 Has long-term demand potential as evidenced earlier

 Is the safest investment domain in the realty
 Demand is picking up steadily and, consolidating Developers are looking
 Government support for the sector is most evident in for alternative sources
of funds, as funds from
Residential public sector banks leading with low cost of housing banks have dried up,
Realty finance in addition to a slew of other measures leading to an increase
 Has shorter cycle time and hence quicker completion in opportunity
of projects
 Early returns on investments a distinct possibility

…and creating value for our customers…
Delivering significant Value
The Investments will be made after conducting an

exhaustive assessment/evaluation of all critical criteria
The appraisal and decision making processes of the

team will not only be prompt but also clearly
communicated
Once a decision to invest is reached, it will be
followed by putting forward clear terms, including
approval on key decisions
Advantages of Associating with us
Benefit of the Assurance of A hurdle of 10%

values and expertise from a Profit sharing of
commitment of team having a 80:20
India’s leading successful track An expected IRR
conglomerate record in this of 20%
sector

...through a strong process driven approach to
investments
 Sector evaluation
Step 1: Filtration
 Pre-feasibility studies
Step 2: Due Diligence and  Engaging 3rd party experts

Valuation  Conducting due-diligence
 Low cash out

 Downward protection
Step 3: Entry strategy  ‘Early stage’ entry
 Well-defined exits
 Clear land title

 Established sanction feasibility
Step 4: Validation and Legal
 Multi-tier Investment Committee approval
Compliance
 Definitive agreements with in-built veto & monitoring rights
 Tax-efficient structuring
Step 5: Financial Close  Optimal debt planning
 Value-addition in planning, construction, marketing

Step 6: Project Execution  Periodic monitoring and reporting mechanisms
 Milestone driven disbursements
 Tracking of market conditions

Step 7: Exit  Strategic equity sale
 IPOs /REITs/REMFs
 Self-liquidating SPVs/Pre-sales

Now, The Product
Summary of Key Terms
Fund Name Aditya Birla Real Estate Fund
Fund Size INR. 750 crores with a green shoe option of INR 250 crores
Fund Tenure 6 years with two 1 year extensions
Minimum Commitment Individual Investor – INR 2,500,000; Institutional Investor – INR 100,000,000
Initial Draw-down Amount 20% of the total commitment
Draw-down Notice Period 15 business days
Initial Closing Minimum corpus of INR 500 crores
Investment Term 3 years from date of Initial Closing
Hurdle 10% p.a. calculated in INR
Carry 80:20 [80% to investor] with catch-up

2% p.a. of the total commitment amount during investment period and 2% p.a. of
Management Fees the residual capital commitment thereafter (Total draw downs less cost of
investments sold) . One time set up fee of 3% of capital commitment
Auditor/Custodian Deutsche Bank/Ernst & Young
Counsel Nishith Desai Associates

Distribution of Proceeds - Details
Disbursement Schedule - Details of payout
First Payout 100% of Paid-up Capital Commitment
Second Payout 100% of Hurdle @ 10%
Third Payout Catch up to Investment Manager
Final Payout Balance Distribution:

80% to Investor
20% to Investment Manager
For better understanding of the above, illustration is given below (for a one year horizon)
Capital Commitment 100

Fund Realization 200
Disbursement Schedule
First Payout 100% of Paid-up Capital Commitment 100
Second Payout 100% of Hurdle @ 10% 10
Third Payout Catch up to Investment Manager 2.5
Final Payout Balance Distribution:

80% to Investor 70
20% to Investment Manager 17.5

What makes us and our product unique?
REAL ESTATE - A sector poised to take a huge step forward,

an opportunity in waiting
THE BRAND - Aditya Birla Group, one of the must trusted names in India
THE TEAM – Has extensive real estate experience and a proven track
record
The PRODUCT – Focussed on the most attractive, potential segment,

RESIDENTIAL realty
Product Highlight - Designed for maximum downside protection, flexibility

and easy exits

Disclaimer
This document is being furnished to you by BIRLA SUNLIFE Asset Management Co. on behalf of Aditya Birla Real
Estate Fund strictly on a confidential basis. This document is for informational purposes only and does not
constitute an offer for participating in the proposed Fund. This information profile has been provided to its recipient
upon the express understanding that the information contained herein, or made available in connection with any
further investigation, is strictly confidential and is intended for the exclusive use of its recipient. It shall not be
photocopied, reproduced or distributed to others at any time without prior written consent. This document is neither
a prospectus nor an invitation to subscribe to units. Prospective Contributors and/or investors should carefully
review the underlying Constituent documents of the Fund before making a decision to invest. In general, investment
in the shares of the Fund will involve significant risks. Nothing in this document is intended to constitute legal, tax,
securities or investment advice, or opinion regarding the appropriateness of any investment, or a solicitation for any
product or service. The use of any information set out in this document is entirely at the recipient’s own risk.
Contributors are advised to seek independent professional advice to understand all attendant risks attached to
investments in the Fund. Also, Contributors should have the financial ability and willingness to accept the risks and
lack of liquidity, which are characteristics of the investments described herein. In making an investment decision,
investors must rely on their own examination of the documents and the terms of the Offering to be set out in detail in
a separate document, including the merits and risks involved.
While reasonable care has been taken to ensure that the information contained herein is not untrue or misleading at
the time of publication, BIRLA SUNLIFE Asset Management Co. makes no representation as to its accuracy or
completeness. The information herein is subject to change without notice. Neither BIRLA SUNLIFE Asset
Management Co. nor any of its officers or employees accept any liability whatsoever for any direct or consequential
loss arising from any use of this publication or its contents.
The facts and figures used in this presentation reflect the latest available information and have been sourced from
various reports in leading newspapers, IBEF, Reserve Bank of India, Deutsche Bank Research, Report on Indian Real
estate and, BIRLA SUNLIFE research and other sources that are in public domain.

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Real(i)ty - Indian Real Estate, back on track

Birla Sun Life Asset Management Company Ltd.

Copyright: Birla Sun Life Asset Management Company Ltd. 2009

The REAL ESTATE journey

Glory Despair Recovery

2006-07 2007 -08 2008 -09 2009 -10

 High liquidity at  Rise in  Depressed

After a course correction, Back on track

Birla Sun Life Asset Management Company Ltd. 2

Copyright: Birla Sun Life Asset Management Company Ltd. 2009

0% 20% 40% 60% 80% 100%

Research and markets Cushman and Weikfeild 2009 report

Birla Sun Life Asset Management Company Ltd. 3

Copyright: Birla Sun Life Asset Management Company Ltd. 2009

Indian Real Estate Index – 2009

Source: BSE India Website

FDI Inflow Cumulative

Birla Sun Life Asset Management Company Ltd. 4

Copyright: Birla Sun Life Asset Management Company Ltd. 2009

Birla Sun Life Asset Management Company Ltd.

Copyright: Birla Sun Life Asset Management Company Ltd. 2009

• Highest cumulative demand will be seen by

• Urbanization, development of city suburbs,

• Prize rationalization, reduced costs of

Birla Sun Life Asset Management Company Ltd. 6

Copyright: Birla Sun Life Asset Management Company Ltd. 2009

Birla Sun Life Asset Management Company Ltd.

Copyright: Birla Sun Life Asset Management Company Ltd. 2009

One of India’s Employs More

Has a Dedicated Presence in

Birla Sun Life Asset Management Company Ltd.

Birla Sun Life Asset Management Company Ltd. 9

Copyright: Birla Sun Life Asset Management Company Ltd. 2009

 Alumnus of one of India’s leading B-schools

Birla Sun Life Asset Management Company Ltd. 10

Copyright: Birla Sun Life Asset Management Company Ltd. 2009

Shekhar Rangaraj, Head

 Chartered Accountant with 20 years  More than 20 years of experience in

Birla Sun Life Asset Management Company Ltd. 11

Copyright: Birla Sun Life Asset Management Company Ltd. 2009

Principles for Investments

To maximise value for

Caps on Exposure to Limit Risks:

Above caps to be reviewed periodically by Investment Committee

Birla Sun Life Asset Management Company Ltd. 12

Copyright: Birla Sun Life Asset Management Company Ltd. 2009

Location Focus on the highest potential geographies

High potential cities such Secondary focus will be on

Investment Strategy: Focus on Residential Realty

 Has long-term demand potential as evidenced earlier

Birla Sun Life Asset Management Company Ltd. 13

Copyright: Birla Sun Life Asset Management Company Ltd. 2009

The Investments will be made after conducting an

The appraisal and decision making processes of the

Advantages of Associating with us

Benefit of the Assurance of A hurdle of 10%

Birla Sun Life Asset Management Company Ltd. 14