Investment Opportunity in Palm Plantations for biodiesel in Madagascar Promoted by Environvest

1

Biofuels

 

What are biofuels:

 Biofuels are a type of renewable fuel produced from grains, vegetable oils and animal fats. The 2 best known biofuels are bioethanol and biodiesel.

  

Why Biofuels:

Biofuels can help diversify the fuel supply for transport, and thus decrease the transport sector’s dependence on oil.

Biofuels offer the potential to deliver lower overall greenhouse gas (GHG) emissions compared with conventional fuels (gasoline and diesel or LPG and CNG).

Biofuels reduce GHG emissions entering the atmosphere on a total well-to wheels or crop-to-car basis. That is, the carbon dioxide (CO 2 ) emitted when the biofuel is burnt in the vehicle is offset by the CO 2 absorbed during the growth of the crop.

2 Sustainable Solutions for the Environment

Global Biofuel Demand

Strong growth in biofuel consumption

WORLD AND REGIONAL BIOFUEL PRODUCTION WORLD BIODIESEL PRODUCTION SHARE IN 2006 WORLD BIOFUEL CONSUMPTION

35 30 25 20 15 10 5 0

WORLD BIODIESEL CAPACITY VS PRODUCTION (MILLION MT/YR)

Source: Biodiesel 2020

32,6 2,2 1,8 2,6 1,9 2,8 2 6,5 3,6 12,2 7,1 23,1 9 11,1 2002 2003 2004 Capacity 2005 2006 Production 2007 2008 Sustainable Solutions for the Environment

Brent Crude Oil Price Movement

Higher oil prices will provide additional support for development of clean energy technologies like biofuel 60 40 20 0 160 140 120 100 80

BRENT CRUDE OIL PRICE MOVEMENTS (US$/BBL)

Source: EIA July 2009, Weekly All Countries Spot Price FOB Weighted by Estimated Export Volume

In 2008 Oil prices had crossed the US$ 100/bbl mark. Medium term view is above US$ 65/bbl

137,11 65 Sustainable Solutions for the Environment

Biofuel Market Size

Nascent industry poised for fast growth

WORLD BIOFUEL MARKET SIZE IN US$ BILLION

Source: Biofuels for transportation, New energy management report 2006

74 23 6 17 22 52 Biodiesel Bioethanol

KEY GROWTH POTENTIAL AND CHALLENGES

 

POTENTIAL BENEFITS

 Reductions energy security in oil imports and improved  Lower GHG Emissions Reduced Air Pollution Improved Performance Vehicle  Agricultural /rural jobs, income  Reduction wastes grease etc.) in solid (biomass,

POTENTIAL CHALLENGES

 Higher Fuel Production Costs   Arable Land and Labour Availability Higher Food Prices: Fuel Vs. Food debate 2006 2012E Apart from energy security and green house reduction the development of biofuel as a source of energy when grown on a large scale, could represent a paradigm shift in agricultural development. If mechanisms are introduced to ensure that much of the increase in food prices accrues to the farmers, both biofuel and increased food prices can stimulate rural economic growth through additional capital inflows, create demand for goods and services that provide employment, reduce rural-urban migration, and create linkages and multipliers Sustainable Solutions for the Environment

Global Biofuel Scenario

Biofuel initiatives launched with many countries recently announcing various incentives and targets Sustainable Solutions for the Environment

Biofuel Trade

Increasing global trade flows , capacity expansion and entry of non-agri players in the market – opportunities unlimited…. Sustainable Solutions for the Environment

Global demand for biofuel crops outpacing supply

Arable land availability constraint and slower growth in global feedstock oil production is adding pressures on biodiesel price

WORLD FEEDSTOCK OIL PRODCUTION 2006-08 (MILLION MT)

Source: Oil World Annual Report (1999-2008) & Oil World Weekly (12 Dec, 2008)

4,99 2008 19,85 37,16 10,69 43,12 4,5 20,14 125

BIODIESEL B-20 HISTORICAL PRICES 2001-08 (US$/GALLON)

Source: US Department of Energy 2008, B-20 prices

4,50 4,00 3,50 3,00 2007 18,75 2006 18,51 0 37,35 35,28 10,84 11,19 38,67 37,14 4,34 19,74 130 2,50

CAGR (2006-08) 2.84%

2,00 1,50 18,54 136 1,00 0,50 Rapeseed Palm oil 50 100 Soybean Palm Kernel oil Sunflower Others 150 0,00 2001 2002 2003 2004 2005 2006 2007 2008 Sustainable Solutions for the Environment

9

Biodiesel Feed Stock Options

Biodiesel Feedstock Options

With high productivity and lower production costs, palm is a more suitable for development of biofuels in the region with arable land and labour

Feedstock Cost of Production US$/LTR Yield, LTR/HA/YR GHG EMISSION REDUCTION

Rapeseed Soybean Palm Sunflower Jatropha 0.60-0.82

0.50-0.75

0.40-0.60

0.50-0.65

0.30-0.50

1000-1200 400-700 4500-6000 800-1000 2000-2500 48-60 40-65 50-55 40-65 40-45

ENERGY INPUT/OUTPUT

9-9.5

9-10.5

10-15 NA 5-10 NA

REMARKS

Better used as food crop due to nutritive value and low oil yield. Oil production cost /ha is high Better used as food crop due to nutritive value and low oil yield. Oil production cost /ha is high High oil yield and low production costs Better used as food crop due to nutritive value and low oil yield. Oil production cost /ha is high Long gestation period and low yield. Good for wastelands with low arable potential Very high costs of cultivation and not proven on commercial scale Algae 3.0-4.0

150000-175000

Source: Fulton et al, Gardner, US DOE, EIA; ICRISAT

NA 250

WORLD FEEDSTOCK OIL USE (MILLION LBS)

Source: Oilseeds Workshop, Dec 2008

200 38% 39% 38% 38% 38% 39% 150 100 37,69 40,86 40,77 43,57 45,7 49,91 50 0 62,07 65,25 66,31 70,79 74,62 79,04 1995 1996 1997 1998 1999 2000 Food 52,42 81,12 2001 Fuel 39% 56,13 83,61 40% 61,27 86,66 41% 69,28 91,33 2002 2003 2004 % Supply Used for Fuel 43% 78,28 94,96 2005 45% 82,11 97,43 2006 46% 86,26 100,94 2007 46% 90,03 104,93 2008 46% 50% 40% 30% 20% 10% 0% Sustainable Solutions for the Environment

Oil Palm as feedstock



Choice of Oil Palm as Feedstock

 High oil yield: 5-6 t/ha   Lower cost of production: 0.4 to 0.6 USD/litre Attractive local market.

    Large export market for crude palm oil and derivatives.

Suitable land and climatic conditions of the region.

Approachability of a sea port near the proposed project area.

Optional choice for Palm oil to be sold as    Crude Palm oil Refined palm oil Palm oil based Biodiesel Sustainable Solutions for the Environment 11

Oil Palm Varieties

High yielding varieties suitable for Africa

Palm types

Deli x Ghana Deli x Nigeria Evolution Deli x La Me Tanzania x Ekona Bamenda x Ekona

Trunk growth (cm/yr) Leaf length (m)

55-60 8-8.5

50-55 50-55 50 - 55 50 - 55 45-50 7.6-8.0

7.6-8.0

7.6-8.0

7.6-8.0

7.6-8.0

Compacta x Ghana Compacta x Nigeria Deli x Compacta Amazon Brunca Clone de compactas

Source: www.asd-cr.com

, Costs Rica

40-45 40-45 40-45 25 25 <40 6.6-6.9

6.6-6.9

6.6-6.9

7-7.5

8-8.5

<6.5

DELI X LA ME (STANDARD VARIETY)

 The Deli x LaMe lines were developed in the Ivory Coast by the former IHRO. Some of these lines, including palms derived from L2T, were introduced to Costa Rica in 1980  Tolerant to vascular wilt a prominent disease found in Africa  Grows to 2 meters with a FFB yielding capacity of 5 t/ha increasing to 15 t/ha during later years

Oil to Bunch (%)

28 - 30 28-30 >30 <26 26-28 28 28-30 28-30 28-30 21-23 18-20 28-32

Fruit (g)

9-9.5

9-10.5

>11 <9 <9 <9 9-10.75

9-10.5

9-10.5

9-10.5

9-10.5

NA

Tolerability Bunch(kg) Low sunlight Low temp

>22 High Moderate >22 >22 <18 18-22 18-22 Moderate High Moderate Moderate Moderate Moderate Moderate Low High High 18-22 18-22 18-22 >22 >22 NA Moderate Moderate Moderate Moderate Moderate NA Moderate Moderate Moderate Low Moderate NA

Drought

Moderate Moderate Moderate High Mod-High High Mod-High Mod-High Moderate Low Moderate NA Sustainable Solutions for the Environment

Palm Oil Producing Nations

Malaysia and Indonesia account for 85% of the global palm oil supply, but are constrained on arable land given deforestation concerns

Countries

Indonesia Malaysia Thailand Nigeria Colombia Ecuador Papua New Guinea Cote d'Ivore Honduras Brazil Costa Rica Guatemala Vanezeula Others

Total 1999

6,250 10,554 560 720 500 263 264 264 90 92 122 53 60 833

20,625 2000

7,050 10,842 525 740 524 218 336 278 101 108 137 65 70 873

21,867 2001

8,080 11,804 625 770 548 228 329 205 130 110 150 70 52 883

23,984 2002

9,370 11,909 600 775 528 238 316 265 126 118 128 86 55 895

25,409 2003

10,600 13,355 690 785 527 262 326 240 158 129 155 85 41 906

28,259 2004

12,380 13,976 735 790 632 279 345 270 170 142 180 87 61 940

30,987 2005

14,100 14,962 700 800 661 319 310 320 180 160 210 92 63 969

33,846 2006

16,050 15,881 860 815 713 352 365 330 195 170 198 125 65 1,023

37,142 2007

17,270 15,824 1,020 835 732 396 384 320 220 190 200 130 70 1,083

38,674 2008

19,330 17,734 1,170 860 800 415 400 330 268 220 202 139 56 1,194

43,118 Currently Malaysia dedicates 5 million Ha to oil palm plantations, while not more than 6 million can be dedicated to this crop, an increase of 20%, allowing for a only a few years of market growth

Sustainable Solutions for the Environment

Safflower – An Additional source of income for the initial years.

        Oil crop with a duration of 125-130 days Can be grown throughout the year under favourable climatic conditions.

Adaptable to climatic conditions prevailing in the African region. Temperatures ranging from 25-32 0 C found to be the most conducive.

Seeds have an oil content ranging from 26-30%.

Yields as high as 4 tonnes/ha/yr can be realized with 2 crops per year.

Dried seeds can be stored for long and hence can be used round the year.

Staggered sowing and harvesting will help in longer availability of raw material for the biodiesel plant.

Crop is drought tolerant with lower requirements of nutrients comparatively.

  The cost of cultivation of 2 crops per hectare per year is $ 416 with a gross income of $ 684 per ha/yr.

Safflower can be source of raw material for the biodiesel plant to be set up in the 2 nd year  Cultivation of 2000 ha of safflower will ensure a raw material of an average of 8000 t/yr.

14 Sustainable Solutions for the Environment

15

Biofuel Potential in Sub-Saharan Africa

Biofuel Development Potential in Sub-Saharan Africa

Sub-Saharan Africa has plenty of uncultivated irrigated land with no need to deforest. Biodiesel production is estimated to create up to 1.1 million jobs in Sub-Saharan Africa – FAO 2005 Sustainable Solutions for the Environment

Land Usage and Population Density in Sub-Saharan Africa

Land availability with low population density is driving foreign investment in this region

LAND USE DATA IN SELECTED COUNTRIES (2006)

Source: FAO Report “Land Grab or Opportunity” 2008

POPULATION DENSITY DATA IN SELECTED COUNTRIES (2006)

Source: FAO Report “Land Grab or Opportunity” 2008

FOREIGN INVESTMENT STOCK IN SELECTED COUNTRIES

Source: UNCTAD 2008

Sustainable Solutions for the Environment

Land Under Investor Claim for Biofuel (Approved Projects)

Production of liquid biofuels is a key driver of much recent land acquisition

KEY BIOFUEL PROJECTS IN MADAGASCAR Year

2005 2008 2008 2008 2008 2008 2008 2008 2008 2008

Country

Madagascar Madagascar Madagascar Madagascar Madagascar Madagascar Madagascar Madagascar Madagascar Madagascar

Investor

D1 BP GEM Biofuels PLC JatroSolutions GmBH TOM-Investment-MMF J+J Group NEO-new ecologic oil Avana Group ERI-eco regional initiatives Jatrogreen JSL-GEXSI

Type of Crop Area (Ha)

Jatropha Jatropha Jatropha Jatropha 17000 452000 3000 500/100000*

Remarks

So far mainly contract farming, small own plantation established in 2008 (50 Ha) Planted out 30,000 Ha. Company is listed on AIM and secured land rights for 50 years on 452000 Ha Jatropha Plantation for Biodiesel Jatropha Jatropha Jatropha 25000* 30000* 10000* NA NA NA NA Jatropha Jatropha Jatropha 680 200/3000* 300/300* NA NA NA

Source: WWF Report, 2008

Sustainable Solutions for the Environment

Environvest: Project Madagascar

Madagascar Country Fact Sheet

Geography

Area Capital Climate

People

Population (2009E) Literacy Health Work force

Government

Type Administrative Subdivisions Governance Index Rank*

Economy (2008)

GDP Average Growth Rate Per Capita Income 592,000 sq km Antananarivo Moderate interior tropical coasts 20.6 million 68.9% Infant Mortality Rate – 54.2/1000. Life Expectancy 63 years Agriculture: 80%; Industry : 7% Republic 6 regions 25 US$ 9.7 billion NA US$ 1,000 Economy Structure Trade Agriculture: 26% of GDP; Industry and Manufacturing: 15.9% of GDP Exports: US$ 989 million Major Markets France, China, Iran, Mauritius and Hong Kong

Source: US Department of State, * - Mo Ibhrahim index

Sustainable Solutions for the Environment

Investment Support

The Government of Madagascar has has begun to implement a regulatory framework favourable to investment.

        Liberalisation of the economy through the privatisation of state-owned companies and of financial transfers by resident and non-resident foreigners and abolition of export taxes.

Regional integration through membership of the Common Market of Eastern and Southern Africa (COMESA), and participation in the Cross Border Initiative (CB), the Indian Ocean Commission and the Indian Ocean Rim Association for Regional Cooperation (IOR-ARC).

Promotion of the Export Processing Zone (EPZ) regime, granting various incentives (including tax) to export oriented investment.

Madagascar is a member of the Multilateral Investment Guarantee Agency (MIGA) and of the African Trade Insurance Agency (ATI) to cover investors against political risks and to guarantee international financial or trade transactions. The free movement of capital is ensured by the conventions signed with the IMF.

State-owned land can be allocated to foreign companies through a 99-year lease. Moreover, the 99-year real estate lease gives the leaseholder a mortgage right which can be transferred or seized in the prescribed forms for foreclosure. Surveys have been carried out to identify state-owned land that can be reserved for industrial development or tourism.

A Companies Information Office (BIPE) has been established to assist private companies in the registration and search for market information. A 'one-stop-shop' for private investment (GUIDE) is operational and aims to facilitate and reduce the administrative procedures related to the creation, investment and operation of a company (administrative formalities, tax system, long stay visa, etc).

Madagascar is speeding up its legal reforms, including the business regulatory framework. New corporate laws and collection procedures have been adopted.

Government has adopted steps like; Abolition of VAT collection for exports and EPZ firms, up to the amount of their VAT credit; Abolition of deposit payment and facilitation of income payment; Suppression or suspension of import taxes on goods such as cement, yarns and fabric, iron, steel and other needed for items for construction, agricultural material and equipment.

Sustainable Solutions for the Environment

Trade Agreements for Madagascar

Agreements have been put in force to give eligible Sub-Saharan African (SSA) countries and the least development countries (LDCs) quota free/duty free access to United States and EU Markets  Madagascar has significantly liberalized its trade regime in recent years. Its present trade policy framework is essentially based on tariffs. Export restrictions have been eliminated, as have foreign exchange controls. The Government has placed emphasis on export promotion, but limited capacity has constrained any significant export-led growth  Madagascar has increasingly participated in regional trade agreements. Madagascar's main trading partners are the European Union (EBA), the United States (AGOA), and Japan  Madagascar has made considerable efforts to create an environment conducive to private investment, both domestic and foreign. With a few exceptions (including in real estate and areas still under State control), 100% foreign ownership is permitted in most economic activities  Madagascar, has significantly liberalized its trade regime in recent years. Its present trade policy framework is essentially based on tariffs. Customs tariff rates have been organized into four bands ranging from zero to 30% Sustainable Solutions for the Environment

Project Site Location

Sustainable Solutions for the Environment

Project Site Characteristics

Parameters

Location Area Altitude Temperature Population Density Rainfall (total mm/year, pattern) Water level Distance from Port Land Cover Available Land for Palm Plantation Land Allocated (MOU) Project Land Area Soils and Topography Length of Growing Period and Soil Moisture Properties Sustainable Solutions for the Environment

Details

Fort Dauphin (Madagascar) South East coast of Madagascar 300-700 m Min: 20.6 & Max: 27.3 o C 1.32/sq km 3250 mm/yr, Intermittent rains throughout the year High 50 km from Taolanaro Port Grass lands 157,600 ha 125,000 ha 10000 ha Alluvial soil, (mixture of Plateau and slopes) 25 years, Well drained with adequate residual moisture

Project plan

Land acquisition

Seeds purchase

Land Development Nursery Development Plantation Harvesting FFB’s FFB Crushing Unit Palm kernel crushing unit

Sustainable Solutions for the Environment

Market Refined Oil Refining Unit Biodiesel Biodiesel Unit Crude Palm Oil

25

Brief overview of the project

 The project aims at development of palm plantations on 10,000 ha of land on the eastern coast of Madagascar.

 The project involves the following: 

Land development:

  Felling, Land clearing, Leveling, preparation of irrigation & Drainage channels.

Roads, Lining and Layout.    Installation of Boreholes and irrigation systems.

Seed procurement:

 Import of high quality seeds/ sprouted seeds from PalmElit SAS - France Nursery Development: (14 Months)   Development of 106 ha of land for Nursery. The seeds/sprouted seeds would be grown pre-nursery for 3-4 months and then planted into bigger pots/polybags for 8-10 months for complete maturity to transplant.

 Polybags/pots are arranged at 70 x 60 cm spacing, in an equilateral triangle arrangement.

26 Sustainable Solutions for the Environment

Brief overview of the project (Contd..)

  

Plantation Development: ( 4 Months)

 Pit digging, Manure and Fertiliser application   Transplanting from the nursery at a spacing of 9 x 8 m: 138 Plants per hectare 114 ha plantation per day with 3 labours/ha/day.

Harvesting : (4 Months/year)

 Maturity for 1 st Harvest after 4 years of plantation development.

 Yield of FFB(Fresh fruit bunches) vary from 5t/ha in the 4 th in the 10 th year Year to 15-18t/ha   114 ha harvested daily with an average yield of 5-6t/ha.

Transportation:

 Harvesting done by labours manually with the help of Chisel/Harvesting Knife.

The harvested FFB’s are collected and transported to the crushing unit with the help of tipper trucks.

27 Sustainable Solutions for the Environment

Brief overview of the project (Contd..)

  

FFB Crushing Unit: ( Capacity 40t/hr)

  Sterilization of FFB’s, Threshing of FFB’s for fruit separation, Digestion of the fruits in a Digester, Pulp Pressing and Oil Extraction Oil Clarification, Oil filtering, Oil Drying to reduce moisture.

  Crude Storage Running 90 days.

Palm Kernel Crushing Unit: ( Capacity 1t/hr)

 Nut recovery, Pericarping, Nut cracking, Kernel separation and drying   Kernel oil extraction Running 180 days

Refining Unit ( Capacity 175 KLPD)

 Crude Palm oil to Refined to a higher grade.

  Storage for longer use Running 180 days.

28 Sustainable Solutions for the Environment

Brief overview of the project (Contd..)

 

Transesterification Unit/ Biodiesel Unit: ( Capacity 100 KLPD)

  Semi-continuous Batch Process BD unit ( Eastern Biodiesel technologies, India) Both Crude and Refined palm oil can be used for producing biodiesel.

 BD plant running for 300 days.

Products for Offtake:

  Crude Palm Oil Refined Palm oil and derivatives   Biodiesel Glycerine 

Other activities related to the project:

 Community development activity like Drinking water wells for the local community, Job opportunities in the project, help in construction of houses, and other related activities.

29 Sustainable Solutions for the Environment

Project details (Tabulated)

Description Plantation area Duration for Nursery and area Duration for Plantation on 10000 ha Palm plantation returns FFB yield/ha/year Crude palm oil Yield/ha/year Biodiesel conversion rate from CPO Biodiesel conversion rate from RPO POME & other by-products Biomass yields/ha/yr FFB Crushing unit capacity Palm kernel crushing unit Refining unit capacity Transesterification unit capacity Plant operation days Safflower cultivation as additional income source

Sustainable Solutions for the Environment

10000 ha 14 months / 106 ha 4 months 4 th Year onwards 5 t initially to 15 t at full maturity 3 to 5 t 78% 95% 70% 2-3 t 40 t/hr 5t/hr 175 KLPD 100 KLPD 300 2000 ha

30

Details of expenses

Details Land acquisition & development costs Nursery Material costs(Seeds , fertilisers) Plantation costs Irrigation and water costs Total Labour + staff costs Equipment and machinery costs Overhead costs Pre-operative expenses Maintenance material costs FFB Crushing unit costs Palm kernel crushing unit Refining unit cost Transesterification costs Costs of Chemicals Cost of safflower cultivation (2000 ha/yr) Miscellaneous costs Total

Sustainable Solutions for the Environment

Cost(million $) 0.20

2.39

0.20

0.11

1.29

3.83

1.46

0.47

0.57

0.5

0.2

2.5

3.5

0.3

0.83

0.2

18.50

31

Yield

Fruit Vs Palm Oil Yield per Ha Crude, Refined and Biodiesel Yield per Ha

Sustainable Solutions for the Environment 32

Financials – Profit and Loss Account

Revenues

- Crude Sale - Refined Sale - Biodiesel Sale Biomass Tree trunk Safflower Total Revenue

Operating expenses

Land Lease Plantation Maintenance Permanent Staff Overheads Harvesting Costs (Per Year) Chemical costs Safflower Costs

Total Operating expenses

EBITDA EBITDA % Depreciation EBIT Interest on Working Capital Interest on Term Loan PBT Tax PAT PAT%

till

Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Mar-25 Mar-30 Mar-35 1,368,000 1,368,000 1,395,360 1,395,360 1,423,267 1,423,267 1,451,733 1,451,733 828,000 1,656,000 2,415,000 436,770 1,480,767 6,816,537 1,380,000 2,760,000 4,025,000 727,950 1,510,383 10,403,333 2,208,000 4,416,000 6,440,000 1,164,720 1,540,590 15,769,310 2,760,000 5,520,000 8,050,000 1,455,900 1,571,402 19,357,302 3,312,000 6,624,000 9,660,000 1,747,080 1,602,830 22,945,910 4,140,000 8,280,000 12,075,000 2,183,850 1,769,654 28,448,504 4,140,000 8,280,000 12,075,000 2,183,850 1,953,841 28,632,691 4,140,000 8,280,000 12,075,000 2,183,850 2,157,198 28,836,048 832,000

832,000

536,000 536,000 848,640

848,640

546,720 546,720 1,060,399 (1,060,399) (1,060,399) 1,060,399 (1,060,399) (1,060,399) 1,060,399 (524,399) (524,399) (0) 1,060,399 (513,679) (513,679) (0) 865,613

865,613

557,654 557,654 882,925

882,925

568,807 568,807 1,060,399 (502,744) (502,744) (0) 1,060,399 (491,591) (491,591) (0) 118,309 45,946 191,316 98,057 300,000 900,584

1,654,212

5,162,326 76% 883,666 4,278,660 132,980 1,060,399 3,085,281 617,056 2,468,225 36% 10,000 365,354 82,703 364,670 137,056 306,000 918,595

2,184,378

8,218,954 79% 897,666 7,321,289 219,280 1,060,399 6,041,609 1,208,322 4,833,288 46% 10,000 379,094 86,838 371,561 143,685 312,120 936,967

2,240,265

13,529,045 86% 911,666 12,617,380 345,692 1,060,399 11,211,289 2,242,258 8,969,031 57% 10,000 393,430 91,180 378,648 150,645 318,362 955,706

2,297,972

17,059,330 88% 939,666 16,119,664 430,051 1,016,216 14,673,398 2,934,680 11,738,718 61% 10,000 408,390 95,739 385,938 157,953 324,730 974,821

2,357,571

20,588,339 90% 967,666 19,620,674 514,417 927,849 18,178,408 3,635,682 14,542,726 63% 10,000 493,638 122,190 425,631 200,355 358,528 1,076,281

2,686,623

25,761,881 91% 985,094 24,776,787 641,951 486,016 23,648,819 4,729,764 18,919,055 67% 10,000 599,568 155,949 471,336 254,471 395,844 1,188,301

3,075,469

25,557,222 89% 985,094 24,572,128 643,549 44,183 23,884,395 4,776,879 19,107,516 67% 10,000 731,594 199,035 523,977 323,539 437,043 1,311,980

3,537,168

25,298,880 88% 985,094 24,313,785 645,447 23,668,339 4,733,668 18,934,671 66% 33 Sustainable Solutions for the Environment

Financials – Balance Sheet BALANCE SHEET

LIABILITIES

Equity Reserves Total Networth Long Term Debt Working Capital Loan

Total Liabilities

Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Mar-25 Mar-30 Mar-35 (1,060,399) (1,060,399) 8,836,657 (2,120,798) 6,715,859 8,836,657 8,836,657 (2,645,196) 6,191,460 8,836,657 8,836,657 (3,158,875) 5,677,781 8,836,657 8,836,657 (3,661,620) 5,175,037 8,836,657 8,836,657 (4,153,211) 4,683,446 8,836,657 8,836,657 (1,684,986) 7,151,670 8,836,657 1,329,802 8,836,657 3,148,301 11,984,958 8,836,657 2,192,804 8,836,657 12,117,332 20,953,989 8,836,657 3,456,922 8,836,657 23,856,051 32,692,707 8,100,269 4,300,507 8,836,657 38,398,777 47,235,433 7,363,880 5,144,170 8,836,657 129,673,251 138,509,908 3,681,940 6,419,514 8,836,657 224,849,218 233,685,875 6,435,494 8,836,657 319,958,326 328,794,983 6,454,468 (1,060,399) 15,552,516 15,028,117 14,514,438 14,011,694 13,520,102 17,318,129 23,014,418 33,247,567 45,093,483 59,743,484 148,611,362 240,121,369 335,249,451

ASSETS Gross Block

Less Cumulative Depreciation Net Block

Current Assets

Sundry Debtors Advance to suppliers Net Current Assets Cash & Cash Equivalents (1,060,399) 17,673,313 17,673,313 (2,120,798) 17,673,313 17,673,313 17,673,313 17,673,313 (2,645,196) (3,158,875) 17,673,313 17,673,313 17,673,313 17,673,313 17,673,313 883,666 16,789,647 17,743,313 1,781,331 15,961,982 (3,661,620) (4,153,211) 1,682,428 271,925 1,954,353 (1,425,871) 2,804,047 359,076 3,163,122 3,889,314 17,813,313 2,692,997 15,120,316 17,953,313 3,632,663 14,320,650 18,093,313 4,600,328 13,492,985 19,513,313 9,662,371 9,850,942 19,513,313 14,587,842 4,925,471 19,513,313 19,513,313 4,486,475 368,263 4,854,737 13,272,514 5,608,093 377,749 5,985,842 24,786,991 6,729,712 387,546 7,117,258 39,133,242 8,412,140 441,637 8,853,776 129,906,643 8,412,140 505,556 8,917,696 226,278,201 8,412,140 581,452 8,993,592 326,255,859

Total Assets

(1,060,399) 15,552,516 15,028,117 14,514,438 14,011,694 13,520,102 17,318,129 23,014,418 33,247,567 45,093,483 59,743,484 148,611,362 240,121,369 335,249,451 Sustainable Solutions for the Environment 34

Financials – Cash Flow

CASH FLOW STATEMENT

PAT Add Depreciation Add Interest Expense Operating Cash Flow before WC Investment in Working Capital Mar-10 (1,060,399) Mar-11 (1,060,399) Mar-12 (524,399) Mar-13 (513,679) Mar-14 (502,744) Mar-15 (491,591) Mar-16 2,468,225 Mar-17 4,833,288 Mar-18 8,969,031 Mar-19 11,738,718 Mar-20 14,542,726 Mar-25 18,919,055 1,060,399 1,060,399 1,060,399 536,000 1,060,399 546,720 1,060,399 557,654 1,060,399 568,807 883,666 1,193,379 4,545,269 897,666 1,279,679 7,010,632 911,666 1,406,091 11,286,788 939,666 1,446,266 14,124,650 967,666 1,442,266 16,952,658 985,094 1,127,968 21,032,117 Mar-30 19,107,516 Mar-35 18,934,671 985,094 687,733 20,780,343 985,094 645,447 20,565,212

Net Cash after Working Capital

Increase/Decrease in Capex

Net Cash for Investing Activities

increase/Decrease in Equity Increase/Decrease in WC Loan Less Interest paid on WC Loans Cash and Cash Equivalents -

-

-

-

17,673,313 -

536,000

-

(17,673,313) -

8,836,657 8,836,657 (1,060,399) (1,060,399)

16,612,914

(1,060,399) (2,120,798) (1,060,399)

(1,060,399)

(524,399) (2,645,196)

546,720

-

-

(1,060,399)

(1,060,399)

(513,679) (3,158,875)

557,654

-

-

-

568,807

-

-

(1,060,399)

(1,060,399)

(502,744) (491,591) (3,661,620) (1,060,399)

(1,060,399)

(4,153,211) 1,682,428 271,925

2,590,916 -

1,329,802 (132,980) (1,060,399)

136,423

2,727,339 (1,425,871) 1,121,619 87,151

5,801,863

70,000

(70,000)

863,002 (219,280) 1,682,428 9,187

9,595,173

70,000

(70,000)

1,264,118 (345,692) 1,121,619 9,486

12,993,546

140,000

(140,000)

843,586 (430,051) (736,388) (1,060,399)

(416,678)

(1,060,399)

(141,973)

5,315,185 3,889,314 9,383,200 13,272,514 (1,016,216)

(1,339,069)

11,514,477 24,786,991 1,121,619 9,797

15,821,242

140,000

(140,000)

843,663 (514,417) (736,388) 11,544

21,020,573

-

-

2,886 (641,951) (736,388) 13,667

20,766,677

-

-

3,417 (643,549) 16,257

20,548,955

4,064 (645,447) (736,388) -

-

(927,849)

(1,334,991)

14,346,251 39,133,242 (486,016)

(1,861,470)

19,159,104 129,906,643 (44,183) -

(1,420,704) (641,383)

19,345,973 226,278,201 19,907,572 326,255,859 35 Sustainable Solutions for the Environment

Financials – Cash Flow Analysis

DISCOUNTED FREE CASH FLOW ANALYSIS

PAT Add Depreciation Add Interest Expense Change in WC Less CAPEX FCFF Mar-10 (1,060,399) 1,060,399 (17,673,313) (17,673,313) Mar-11 (1,060,399) Mar-12 (524,399) 1,060,399 1,060,399 536,000 Mar-13 (513,679) Mar-14 (502,744) 1,060,399 546,720 1,060,399 557,654 Mar-15 (491,591) 1,060,399 568,807 Mar-16 2,468,225 883,666 1,193,379 (1,954,353) (70,000) 2,520,916 Mar-17 4,833,288 897,666 1,279,679 (1,208,769) (70,000) 5,731,863 Mar-18 8,969,031 911,666 Mar-19 11,738,718 939,666 1,406,091 (1,691,615) (140,000) 9,455,173 1,446,266 (1,131,105) (140,000) 12,853,546 Mar-20 14,542,726 967,666 Mar-25 18,919,055 985,094 1,442,266 (1,131,416) 15,821,242 1,127,968 (11,544) 21,020,573 Mar-30 19,107,516 985,094 Mar-35 18,934,671 985,094 687,733 (13,667) 20,766,677 645,447 (16,257) 20,548,955 Project NPV Project IRR 19,627,757 USD 24.08% terminal growth not assumed

DISCOUNTED FREE CASH FLOW ANALYSIS EQUITY

Mar-10 FCFF Less Interest Expense Add Debt Debt Repayments FCFE (17,673,313) (1,060,399) 8,836,657 (9,897,055) Mar-11 (1,060,399) (1,060,399) Mar-12 536,000 (1,060,399) Mar-13 546,720 (1,060,399) (524,399) (513,679) Mar-14 557,654 (1,060,399) Mar-15 568,807 (1,060,399) (502,744) (491,591) Mar-16 2,520,916 (1,193,379) 1,329,802 2,657,339 Mar-17 5,731,863 (1,279,679) 863,002 5,315,185 Mar-18 9,455,173 (1,406,091) 2,593,920 10,643,002 Mar-19 12,853,546 (1,446,266) 1,706,587 736,388 13,850,255 Mar-20 15,821,242 (1,442,266) 3,437,583 736,388 18,552,947 Mar-25 21,020,573 (1,127,968) 2,135,311 736,388 22,764,305 Mar-30 20,766,677 (687,733) 4,293,795 736,388 25,109,127 Mar-35 20,548,955 (645,447) 2,153,089 22,056,597

IRR- equity 29.07%

36 Sustainable Solutions for the Environment

Sustainable Solutions for the Environment

Thanks

37