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    Unitech Ppt Unitech Ppt Presentation Transcript

    • CONTENTS • Indian Real Estate Industry • Overview of Unitech • Business Model • Business Strategy • Business Segments • Residential • Commercial • Retail • Entertainment • Hospitality • SEZs • Other Businesses • Development Plan • Key Strengths • Financials
    • REAL ESTATE IN INDIA IS POISED FOR STRONG GROWTH • Real Estate is emerging as one of the India’s fastest growing sectors • The Industry could grow from US$12 billion in 2005 to US$45-50 billion in 2010 • Potential for superior growth of the industry leaders KEY DEMAND DRIVERS Residential Office/ IT Parks Retail Hotel SEZ’s • Demographics • Most attractive • India is the most • Buoyant • Govt. introduced destination for attractive retail economic SEZ policy to • Urbanization IT & ITeS destination growth & FDI boost economic • Rising Income services driving business activity/exports levels • Organized retail travel • Demand from gaining share • Transformational • Access to other sectors is • India expected opportunity for finance • Relaxation of FDI growing to be among top real estate regime • Fiscal incentives tourist developers destinations by • Self-built to 2020 developer built homes Source: JLL, Merrill Lynch, Research Reports
    • OVERVIEW OF UNITECH • India’s leading real estate company; market capitalization of over US $ 11 bn. Listed for over 2 decades. Cumulative capital raised – less than US $ 10 mn. • Over three decades of experience in Indian Infrastructure and real estate development • Leading player in the National Capital Region (NCR) and Kolkata markets. Fast establishing a strong presence in other major cities such as Chennai, Hyderabad, Kochi etc. • Most Diversified Product Mix – Residential, Office/IT Parks, Retail Malls, Amusement Parks, Hotels/Convention Centre and SEZs • Geographically diversified land reserves of nearly 10,700 acres with a developable area of approximately 500 million sq.ft • Employee strength of over 1800 including approximately 600 engineers, architects and management professionals • Strong relationship with global leaders who are occupants of its developed properties • Relationships with internationally acclaimed architects and design consultants/groups including HOK(USA), Callison(USA) and RMJM(UK).
    • OUR BUSINESS MODEL – CAPITAL EFFICIENT Spanning across all segments of real estate Segment Approach Differentiators • Strategic locations • Acquire, develop, brand, sell world class homes Residential • Superior quality • Townships and Group Housing • Customer delight • Acquire land, develop, rent, sell • Marquee customers • Focus on IT, ITeS • Global standards Commercial • Built to suit, customized, multi-tenanted • Efficient capital rotation • One-of-its-kind family entertainment model • Unmet market demand Entertainment • Exclusive international arrangements • Strong valuable niche • Acquire land, develop, bring in anchor tenant, • Creative business formats hold/sell • Leveraging relationships for quality Retail • Focus on quality, mall management, preferred anchor in niche segments relationships • Acquire land, develop, enhance value, hold, sell • Partnerships with global brands • Build a portfolio of budget, 4 star, serviced Hotels • Create sustainable value apartments, resorts, etc. • Acquire land bank, build infrastructure/linkages, • Strategic locations SEZs bring in occupiers/ tenants, enhance value • Relationships
    • BUSINESS STRATEGY • Achieve a high growth by establishing a pan India presence with focus on markets experiencing strong economic activity • Focus on high value added activities of the real estate value chain; quick recycling of capital to maximize returns • Land bank acquisition - Early identification of potential growth areas. Focus on suburbs of key towns and cities. Avoid open auction process • Focus on residential segment while having a diversified product portfolio. • Create a ‘destination’ by undertaking large mixed use projects in the suburbs of cities • Maintain edge in product design and quality • Develop and nurture relationships with all stakeholders • Attract and retain high quality talent
    • RESIDENTIAL PROJECTS • Diverse portfolio of residential products across India • Apartment Complexes • Villa Developments • Golf Course Communities • Developed Plots • “Unitech” - a trusted brand name • Superior designs and benchmarking of projects to International Standards • High level of customer satisfaction • “Superbrand” title in 2004 • Premium over neighbouring developments • Leadership in new markets – Kolkata a prime example • Focus on middle & upper middle income group
    • RESIDENTIAL PROJECTS – Ongoing Projects Project Location Type Approx. Area (in mn sqft) Close Gurgaon Multi-Storeyed 3.0 Uniworld Spa Gurgaon Multi-Storeyed 1.7 Fresco Gurgaon Multi-Storeyed 1.6 Uniworld Garden Gurgaon Multi-Storeyed 1.0 Espace Gurgaon Villas 1.1 Harmony Gurgaon Multi-Storeyed 1.1 Escape Gurgaon Multi-Storeyed 0.7 Horizon Greater Noida Multi-Storeyed 2.3 Habitat Greater Noida Multi-Storeyed 2.0 Heights Greater Noida Multi-Storeyed 0.7 Cascades Greater Noida Multi-Storeyed 0.8 Uniworld City Greater Noida Multi-Storeyed 7.0 Uniworld City Kolkata Multi-Storeyed 4.2 Other Ongoing Projects 4.0 Total 32.0
    • RESIDENTIAL PROJECTS – Upcoming Projects Project Location Type Approx. Land Area (in acres) Unitech Grande Noida Multi-Storeyed 340 Uniworld Resorts Gurgaon Township 189 Uniworld City Kolkata Multi-Storeyed 55 Oasis Chennai Multi-Storeyed 45 Oasis Hyderabad Township 120 Total 749
    • RESIDENTIAL PROJECTS
    • COMMERCIAL PROJECTS • Unitech enjoys a leading position in the Grade A office market in the NCR, esp. Gurgaon with over 3mn sq ft of completed development • Marquee clients including Fidelity, Master Card, Hewlett Packard, Gillette, Hewitt, Vertex, Keane, Convergys, EDS • Existing occupants prefer to lease additional space from Unitech • Mix of various office types • Built-to-suit (e.g. leading international consulting firm) • Customized facilities • Multi-tenanted • Prime Locations near commercial heart of Gurgaon & other cities • Completed Development: Signature towers, Unitech Business Park, Cyber Park • Accelerating business from new clients • World-class standards – renowned architects, efficient and elegant designs • Campus developments – scale-up options to clients • Value additions: common amenities, maintenance, risk and disaster management etc.,
    • COMMERCIAL PROJECTS
    • OVERVIEW – UNITECH CORPORATE PARKS PLC • Isle of Man company investing in Indian real estate, primarily focused on Information Technology (“IT”) Parks/IT Special Economic Zone (“SEZ”) developments • Fully seeded portfolio • Majority stake in all seed portfolio assets • High quality seed portfolio • Over 21 mn sq.ft of leasable area • Strategic location of seed assets • Highly visible development plan – construction already commenced in 4/6 properties • Right of First Refusal on future Unitech IT Parks/IT SEZ developments with a projected built up area of more than 1 mn sqft • Unitech to co-invest in all projects along with UCP • Access to local knowledge and superior execution capabilities through investment management and project management relationship with Unitech and affiliates • Experienced board with majority of independent directors • Intends to target developments which it believes could generate a project level IRR of at least 25%
    • Unitech Corporate UCP-Corporate Structure Parks Plc • The corporate structure provides significant Isle of Man tax and regulatory benefits Nectrus Ltd. (Investment Advisor) • The structure enhances the flexibility for Cyprus UCP to exit through shares of Mauritius Investment Management SPVs or India SPVs Agreement Candor Investments 100% - Mauritius • Opportunities to exit to international or Limited Indian investors Tulipa Acacia Sparrow Myna • Other benefits include Gladiolys Dotterel Investment Properties Properties Holdings Realty Inc Estates Inc s Inc Inc ltd. Ltd. • No capital gain on sale of shares of 60% 60% 60% - 60% 60% 60% Indian/Mauritius SPVs - - - - - India • Dividend distribution tax in Indian SPVs G1 – ITC G2 – IST N1 N2 N3 K1 can be partially offset in Mauritius SPVs 40% 40% 40% 40% 40% 40% • No obligation on UCP to register for Unitech or Affiliates VAT as the principal activity is to invest in subsidiaries
    • HIGH QUALITY FULLY SEEDED PORTFOLIO WITH FUTURE AVENUES FOR GROWTH Strategic location • All seed assets located in prime sub-urban locations within micro-markets • Excellent proximity to major vehicular arteries • All seed assets designed by internationally acclaimed architects State of the art • Project specifications meet needs of top tier tenants architecture • Modular development and scale attractive to growing tenants • Four of the six seed assets have already achieved ground breaking • Remaining projects underway shortly Highly visible development plan • All Construction expected to be complete by April 2010 subject to receipt of all necessary approvals • Superior transparency and understandability of assets • Right of first refusal on future Unitech IT parks/IT SEZ developments Future avenues to with a projected built up area of more than 1 million sq ft portfolio growth • New markets may include Chennai, Hyderabad and Kochi
    • SUMMARY OF SEED PORTFOLIO Seed Portfolio Assets – Snapshot Office Area (sq Name Description Micro Market ft) Retail Area (sq ft) SEZ Status G1 – ITC IT Park built over 24.7 acres in close Gurgaon (NCR) 3,213,737 50,000 Forma approval from Board of proximity to NH - 8 Approval G2 – IST IT Park built over 28.4 acres on old Delhi Gurgaon (NCR) 3,699,076 50,000 Formal approval from Board of Gurgaon Highway Approval N1 IT Park built over 19.3 acres in Sector Noida (NCR) 1,971,590 60,000 Non-SEZ 62, Noida N2 IT Park built over 29.7 acres in Sector Noida (NCR) 3,069,177 60,000 Formal Approval from board of 135, Noida approval N3 IT Park built over 50.0 acres in Greater Greater Noida 4,847,055 100,000 Formal Approval from board of Noida (NCR) approval K1 IT Park built over 45.4 acres in Kolkata Kolkata 4,250,773 100,000 Formal Approval from board of approval Total 197.5 acres 21,051,408 420,000 Note: Given areas are estimates and are subject to change
    • INVESTMENT POLICY INVESTMENT DEVELOPMENT EXIT/REINVESTMENT • Invest in FDI compliant IT • Unitech affiliate to be • Company will target exit park and IT SEZ responsible for development through sale of shares at India development projects and leasing or Mauritius level or sale of assets • Focus on established/ • Board to monitor upcoming IT hubs performance to ensure – Potential buyers include minimum deviation from REITs, international • Will acquire majority stake in business plan institutional investors and assets property funds, and possibly • All developments to exhibit • Co-investment by Unitech in Unitech or other Indian real high quality design all assets estate companies standards • ROFR over applicable • Exit and reinvestment/ • Timely completion targeted projects distribution decisions will by leverage of internal consider expertise and relationships with high quality vendors – Maximization of value • High quality tenants sourced – Return expectations through existing network – Alternative investment and Unitech reputation opportunities – Regulatory framework
    • INVESTMENT MANAGEMENT TERMS • The company will have an initial offering period of 8 years. The life may be extended by • A majority vote of the Board or • Special resolution of the shareholders (75% majority) Company Term • The renewal period may be 1-3 years and the Company’s operating shall not extend beyond year 12 • The net returns made by the Company will be available for reinvestment Re-investment and Distribution • The Board will determine the dividend/distribution policy and will consider making distributions after the first 3 years of the Company’s life • The Company will invest as a majority shareholder but shall not invest in excess of 74% of the equity in any project Corporate Governance • Unitech will maintain a minimum 26% equity stake in any project in which Company is invested • The Company will have a Right of First Refusal for all Unitech qualifying IT Park and IT SEZ development projects with a minimum expected built up area of 1 mn sq. ft. • Majority of the board of directors will be independent
    • INVESTMENT MANAGEMENT TERMS Management Fees • The Asset Manager will be paid quarterly in arrears fees of 0.50% (2.0% annually) of the Company’s average invested equity capital on the applicable historical cost basis • The First Performance Benchmark (FPB) of the Company will be a 10% Project IRR and the Second Performance Benchmark (SPB) of the Company will be a 20% Project IRR • The Asset Manager will receive a Performance Fee from the Company of 20% of the net cash flow generated in excess of the FPB up to the SPB and 30% of net cash flow generated in excess of the SPB • Upon sale of an asset, 75% of the Performance Fee will be paid immediately and 25% will Performance Fees be held in escrow • At the end of the Company’s life, the overall Project IRR for the combined portfolio of Company investments will be determined and Total Performance Fees Due will be determined and escrow distributed accordingly • No clawbacks of Performance Fees previously paid to the Asset Manager
    • RETAIL PROJECTS • Developed the largest mall in India at Noida – lettable area of 1 mn sqft • Has a tenant profile that includes almost every major retail chain in India • High street lifestyle shopping over 220,000 sqft developed at Rohini, Delhi • Tenants includes Levis, Benetton, Addidas, Nike, Bossini, Liliput, Titan, Gini and Jony, Pantaloon etc., • Aggressive plans to develop malls in other markets • Developing convenience shopping centres as part of township development. • Developing International Logistics City – Supply chain infrastructure for retail
    • ENTERTAINMENT PROJECTS • Developing some of Asia’s largest amusement parks • Ideal location and huge market opportunity • JV partnership provides mix of amusement park operating and real estate development skills • Alliance with Turner International for Pogo & Cartoon Network • Commercial real estate component of Unitech’s amusement parks provide significant value creation potential Projects Location Area (Acres) Entertainment City Noida 147 Adventure Island Delhi 62 Chandigarh Entertainment City Chandigarh 73 Total 282
    • HOSPITALITY PROJECTS • Target all hotel categories with customized fit-to-market offerings: • Luxury Business Hotels • Serviced Apartments • Resorts • Limited Service Hotels (Management/ Franchisee) • Our hotel strategy will be focused on building hotels as an integrated part of our real estate projects • Unitech will focus on hotel development and construction • Internationally recognized operators will manage hotels/ resorts • Initially target key metro markets and select other cities • Signed agreement with Marriott for 832 rooms in the next 3 years • In dialogue for additional properties with Marriott/ other hotel chains • Brand Neutral – Maximize exit valuations • Land available for developing 28 hotels/serviced apartments
    • HOSPITALITY PROJECTS
    • SPECIAL ECONOMIC ZONES - SEZs • Unitech is working closely with various state governments to develop SEZs across the country • Unitech is focusing on developing multi-product SEZ’s and also sector specific SEZ’s (IT/Auto) • Unitech has received an in-principle approval for development of Multi-Product SEZ at Kundli, Haryana over 9884 acres. It is expandable to 20,000 acres • Unitech is part of the consortium New Kolkata International Development Pvt. Ltd. which signed an agreement with Government of West Bengal for developing 2 SEZs at Haldia – Petrochemical SEZ over 10,000 acres and a multi-product SEZ over 12,500 acres • Unitech has received an in-principle approval for development of an Auto component SEZ in Gurgaon over 250 acres • In-principle approval received for developing an Apparel SEZ in Gurgaon in over 250 acres
    • OTHER AREAS OF BUSINESS • Infrastructure development: • Unitech was among the first players to enter organized Infrastructure development in India • Wide experience • Roads & Highways • Bridges • Industrial civil structures • Power plant chimneys • Transmission towers & turnkey projects • Experience across domestic & international projects • Currently executing only non Unitech projects • Strong synergies with our real estate business • Facilities management business through a partnership with Trammell Crow • Developing golf courses and golf communities
    • DEVELOPMENT PLAN SUMMARY City/Region Total Land Area Estimated Total Saleable Area (in Acres) (million sq.ft) (million sq. yard) NCR 2565 116.40 1.21 Chennai 2085 104.7 1.42 Kolkata 5198 167.06 4,8 Kochi 673 38.34 .40 Hyderabad 359 18.7 .41 Bangalore 103 9.92 Mohali, Chandigarh 423 12.55 .3 Agra 1500 31.36 1.31 Varanasi 1500 34..1 1.6 Siliguri 232 13.0 Total 14638 546.13 11.45 Share of Unitech in land at certain locations is less than 100%. Unitech’s share in total land shown above is approx. 10700 acres
    • STRENGTHS • Scale of operation and experience in execution of large projects better positions us to identify and successfully implement new projects • Ability of the management to identify and procure land parcels in strategic locations with high profitability prospects • Unitech is an established brand and is associated with a high level of trust amongst customers and suppliers. • Unitech was bestowed upon the title of Super Brand by Super Brand India in September 2004 – one of the only 100 business brands to be conferred such title in the country • Unitech’s projects are known for their design, construction and innovation • Unitech has well qualified and experienced employee base and proven management team. Attracts high caliber management and technical professionals due to its leadership position and progressive people practices • Unitech’s experience and expertise in the construction business can be leveraged to build its real estate business • Unitech’s good working relationships with financial institutions, enhances its ability to raise funding for large projects at competitive rates • Ability to work and effectively liaise with government agencies to ensure timely completion of projects
    • FINANCIALS (CONSOLIDATED) FY07 (Rs. in billion) FY06 (Rs. in billion) Total Income 33.88 9.26 Total Expense 12.87 7.30 Interest 3.02 0.46 Depreciation 0.08 0.11 Profit before Tax 17.92 1.39 Profit after tax 13.06 0.88 Paid Up Equity Capital* 1.62 0.12 Face Value (in Rs)* 2 10 EPS (in Rs.) 16.09 67.33 Reserves (excluding revaluation reserve) 18.80 2.47 Total Debt 39.81 10.45 Total Cash (including investments in liquid 14.30 3.98 instruments