Adani Ports & Special Economic Zone Ltd · NSE:ADANIPORTS
Adani Ports & Special Economic Zone — Merger or Acquisition (August 2021)
44 slides from Adani Ports & Special Economic Zone's merger presentation, Aug 14, 2021
Slide 1: Cover letter: Summary Note and Presentation on Composite Scheme of Arrangement
Ref No: APSEZL/SECT/2021-22/68 August 14, 2021 BSE Limited National Stock Exchange of India Limited Floor 25, P J Towers, Exchange Plaza, Dalal Street, Bandra Kurla Complex, Mumbai – 400 001 Bandra (E), Mumbai – 400 051 Scrip Code: 532921 Scrip Code: ADANIPORTS Sub: Summary Note and Presentation on
Slide 2: Note on Amalgamation of rail track assets: Process & Rationale
Adani Ports and Special Economic Zone Ltd. (APSEZ) Note on Amalgamation of rail track assets Process & Rationale - August 2021
Slide 3: Process and rationale for considering amalgamation of rail track assets
Process and rationale for considering amalgamation of rail track assets SL. No. Details Page No. 1. Objective 2 2. Process followed 2 3. Summary of Sarguja asset 6 4. Rationale for acquiring Sarguja asset 6 5. Valuation of proposed Sarguja asset 7 6. Purchase Consideration of Sarguja asset 8 Transfe
Slide 4: Objective
Process and rationale for considering amalgamation of rail track assets 1. Objective To develop scale in the integrated logistics space by consolidating all rail assets under one pan India platform and to bring efficiency to overall logistics cost by owning and developing critical assets. Adani Port
Slide 5: Process followed
Process and rationale for considering amalgamation of rail track assets and worked in departments like surface transport and defense. (Link to the Profile) • Mr. P. S. Jayakumar Former Managing Director & CEO of Bank of Baroda. with domain expertise in Banking Finance. (Link to the Profile) • Mrs. N
Slide 6: Process followed (continued)
Process and rationale for considering amalgamation of rail track assets 10 The Board of directors in its meeting held on 03 03 March 2021 March 2021, discussed the proposal and approved the same unanimously. 11 Outcome of the board meeting was intimated 03 March 2021 to the Stock Exchanges, followed
Slide 7: Summary of Sarguja Asset
Process and rationale for considering amalgamation of rail track assets 3. Summary of Sarguja Asset Table - 3 Sl. No. Particulars Details 1 Length of the Track 70 Kms 2 Track Capacity 16 rakes per day 3 Land Lease period 50 Years 4 Counter Party RRUVNL 5 Contract Period 30 Years TAUA 6 Potential thr
Slide 8: Rationale for acquiring Sarguja Asset
Process and rationale for considering amalgamation of rail track assets • All rail assets are under one entity, with no competing business within the group. • Significant growth potential is available as the business is yet to mature. • Secured long-term contracts with sovereign equivalent counterpa
Slide 9: Purchase Consideration for Sarguja
Process and rationale for considering amalgamation of rail track assets 6. Purchase Consideration for Sarguja The purchase consideration will be paid by issuing common equity shares of APSEZ to the outgoing ultimate shareholders of Sarguja (Brahmi) as under: For 708 equity shares of Brahmi, APSEZ wi
Slide 10: External agencies appointed for restructuring
Process and rationale for considering amalgamation of rail track assets Apart from the amalgamation of Brahmi (holding company of Sarguja) with APSEZ, as a part of internal restructuring (outside the purview of “policy on related party transactions for acquiring and sale of assets”) to consolidate a
Slide 11: Details of share swap and conclusion
Process and rationale for considering amalgamation of rail track assets Details of share swap for: 1. The amalgamation of Adani Tracks with Sarguja: 100 Sarguja Shares, credited as fully paid-up, for every 2,522 equity shares of the face value of Rs. 10/- (Rupees ten) each fully paid-up held by the
Slide 12: Adani Ports and SEZ Limited, August 2021
Adani Ports and SEZ Limited August 2021
Slide 13: Contents
Contents A Group Profile B Company Profile C Integrated Logistics Platform D Governance Process and rationale for amalgamation E Sarguja Rail Corridor Private Limited F Adani Track Management Services (ATMSPL) G Investment Case H Annexure 2
Slide 14: Adani Group: A world class infrastructure & utility portfolio
Adani Group: A world class infrastructure & utility portfolio Adani Transport & Logistics Energy & Utility • Marked shift from B2B to Portfolio Portfolio B2C businesses– • ATGL – Gas distribution 63.8% 100% 75% 57.8% network to serve key ATL AGEL geographies across India APSEZ NQXT2 Port & Logistics
Slide 15: Adani Group: Decades long track record of industry best growth rates
Adani Group: Decades long track record of industry best growth rates across sectors Port Cargo Throughput (MMT) Renewable Capacity (GW) Transmission Network (ckm) CGD7 (GAs8 covered) 132% 12% 45% 20% 3x 5x 3x 30% 1.5x 4% 7% 25% Industry Adani APSEZ Industry Adani AGEL Industry ATL Industry AGL 2014
Slide 16: Adani Group: Repeatable, robust & proven transformative model of investment
Adani Group: Repeatable, robust & proven transformative model of investment Phase Development Operations Post Operations Origination Site Development Construction Operation Capital Mgmt Activity • Analysis & market • Site acquisition • Engineering & design • Life cycle O&M • Redesigning capital stru
Slide 17: APSEZ: Company Profile
adani Ports and Logistics APSEZ : Company Profile
Slide 18: A transport utility with string of ports and integrated logistics network
APSEZ : A transport utility with string of ports and integrated logistics network West Coast East Coast Capacity 335 MMT Capacity 227* MMT Dahej 14 MMT Tuna 14 MMT Mundra 264 MMT Dhamra Hazira Vizag 45 MMT Mundra - 30 MMT 6 MMT India’s Largest Commercial Dighi Gangavaram^ Port by 8 MMT 64 MMT Krishn
Slide 19: Our Strategy led to market leadership
APSEZ : Our Strategy led to market leadership Cargo Diversification Coal Containers (mmt) Crude Others APSEZ’s pillars of strategy Strategic Partnerships Integrated logistics FY02 FY11 FY21 East Coast West Coast parity West East West East West East Ensured resilience and stickiness of cargo 8
Slide 20: India's largest Transport Utility with Integrated logistics
APSEZ : India’s largest Transport Utility with Integrated logistics APSEZ Port to Hinterland Hinterland to Hinterland Customer First mile Last mile End to End Solution Integrating our platform by removing intermediaries to offer a single window service 9 ^*Ports in India | In addition, Myanmar under
Slide 21: Integrated logistics platform addressing customer needs
APSEZ : Integrated logistics platform addressing customer needs Grain Ware- Inland Rail Trains IFTs Silos housing Waterways Tracks Assets 60 5 0.8 0.4 mn 9 620* FY21 Trains Logistics Parks MMT Sq. ft. Barges KMs 200+ 15 2.5+ 5 mn 25+ 760+ FY25 Trains MMLP MMT Sq. ft. Barges KMs IFT : Inland Freight
Slide 22: Governance Process and rationale for amalgamation of rail track assets
Governance Process and rationale for amalgamation of rail track assets
Slide 23: Objective of Adani Track Management Services
APSEZ : Objective of Adani Track Management Services To develop scale in the integrated logistics space by consolidating all rail assets under one pan India platform Bring efficiency to overall logistics cost by owning and developing critical assets Creation of Investment platform for strategic inve
Slide 24: Board oversight of evaluation process and due diligence
SRCPL : Board oversight of evaluation process and due diligence In order to evaluate the opportunity, Executive Committee (EC) formed. Committee members: • Mr. G. K. Pillai (Chairman of the Audit Committee) (Chairman Former Indian Administrative Services officer and former Home Secretary of India an
Slide 25: Steps & process with timelines
APSEZ : Steps & process with timelines 14 Oct 2020 25 Nov 2020 09 Dec 2020 02 Feb 2021 02 Mar 2021 Formation of EC as per Appointment of Commencement of EC met to discuss EC met the RPT Policy Agencies due diligence by valuation independent valuers the Independent methodology and to conclude the Mr.
Slide 26: Steps & process with timelines (contd.)
APSEZ : Steps & process with timelines …………Contd... 03 Mar 2021 31 Mar 2021 09 July 2021 16 July 2021 09 Aug 2021 Executive Committee The application along No Objection Filling of the NCLT passed order unanimously recommended with Composite Certificate received application with Hon’ble for convening
Slide 27: SRCPL: Key valuation assumptions
SRCPL : Key valuation assumptions Particulars Key Assumptions Capacity Currently serving one operating mine – PEKB (15 MTPA per year) Further extendable to 40 MTPA Coal Demand • RRVUNL : 19 MTPA at current PLF, estimated requirement 35 MTPA at 85% PLF. Annual Contracted capacity of 15.93 MTPA with S
Slide 28: SRCPL share swap estimation and impact of the transaction
SRCPL : SRCPL share swap estimation based on APSEZ shares Proposed Transaction Impact of the Transaction on APSEZ Particulars in Rs. cr No of Net Profit EPS Enterprise Value (DCF) 5,977 Particulars (in Rs. cr) Shares Net Debt at SRCPL 934 (in Rs. cr) (INR / Share) Equity Value of SRCPL 5,043 FY22 E
Slide 29: Transaction Timelines & next steps
APSEZ : Transaction Timelines & next steps ▪ Result of meeting & filing of ▪ Application to stock exchanges ▪ No adverse observation letter petition with NCLT for approval for their No-objection & issued by stock exchanges on 9 comments on the Scheme July 2021 ▪ Filing of NCLT approved Scheme with S
Slide 30: SRCPL: Sarguja Rail Corridor Private Limited
SRCPL : Sarguja Rail Corridor Private Limited
Slide 31: Sarguja rail corridor brief highlights of the project
APSEZ : Sarguja rail corridor brief highlights of the project Asset Details: • Track length - 70 KM • Capacity to handle 16 rakes per day • 50 Years land lease - Till 2065 Other Key features • 30 Years TAUA* with RRVUNL –Till 2044 • Coal Reserve of more than 4 Bn MT in the region • Potential annual
Slide 32: Sarguja rail corridor hinterland potential
APSEZ : Sarguja rail corridor hinterland potential Peak Basin Throughput- 97 MMTPA 1 Existing Mines 1 17 43 16 20 0-5 KM 5-10 KM 10-15 KM 15-20 KM 20-25 KM > 25 KM ▪ Average grade of coal in range of G8* to G11* against G13-G15* in GP and Talcher ▪ Coal grade suitable for Sponge Iron and Cement prod
Slide 33: Sarguja rail corridor facility snapshot
APSEZ : Sarguja rail corridor facility snapshot 22
Slide 34: Adani Track Management Services (ATMSPL)
APSEZ : Adani Track Management Services (ATMSPL)
Slide 35: Existing Rail assets that will be part of ATMSPL
APSEZ : Existing Rail assets that will be part of ATMSPL Operational Rail Asset under APSEZ Krishnapatnam Details Mundra Rail Dhamra Rail Kutch Rail BDRCL Railway Co. 74 Km 68.5 Km 113 Km 301 Km (Palanpur – 63 Km (Bharuch - Rail Line Gandhidham section) Dahej) (Mundra - Adipur) (Dhamra - Bhadrak) (K
Slide 36: Expansion possibility in new projects by Indian Railways
APSEZ : Expansion possibility in new projects by Indian Railways Cargo Demand Forecast as per National Rail Plan Contribution to Existing Rail Cargo Existing Rail Share Expected Rail Expected Rail Commodity Rail Cargo MT/Yr in Transport Share 2031* MT/Yr 2031* Balance of Goods 7% 81 4% 22% 770 Cemen
Slide 37: Existing legal entity structure
APSEZ : Existing legal entity structure 20% APSEZ (Mundra Rail Business) ARIPL 100% 100% 74% 100% 75% DPCL ATMSPL AHPPL APDPL (Dhamra Rail KPCL BTMSPL Business) 100% 11.17% 12.96% KRCL HIL BDRCL KRpCL SRCPL ATMSPL : Adani Tracks Mgt. Services Pvt Ltd | AHPPL : Adani Hazira Port Pvt. Ltd. | APDPL : A
Slide 38: Proposed legal entity structure
APSEZ : Proposed legal entity structure • BTMSPL (parent of SRCPL) to be merged with APSEZ and APSEZ to APSEZ issue fresh equity shares to ARIPL1 100% • Slump sale of Mundra undertaking to ATMSPL ATMSPL • ATMSPL to be merged with SRCPL; SRCPL to be renamed to ATMSPL 12.96% 20% 100% 11.17% • Slump sa
Slide 39: SRCPL investment case
APSEZ : SRCPL investment case The transaction will create value for all stakeholders from the day one as it is EPS accretive All rail assets under one entity, no competing business within the group Significant growth potential available as business is yet to mature Secured long-term contracts with s
Slide 40: Annexures
adani Ports and Logistics Annexures
Slide 41: SRCPL Historical financials
APSEZ : SRCPL Historical financials Rs. In Cr Profit and Loss Statement Balance Sheet Particulars FY18 FY19 FY20 FY21E Particulars FY18 FY19 FY20 FY21E Cargo 3.6 10.6 14.4* 15* N.C. Assets 1448 1545 1494 1464 (MMT) Revenue - 50 452 368 417 Current Asset 247 366 573 670 operating EBIDTA 34 325 357 39
Slide 42: Sarguja rail corridor track capacity
APSEZ : Sarguja rail corridor track capacity Capacity Assessment: Scott’s formula Existing Longest Section: Ramanujnagar- Tarkeshwarpur (20.233 Km) Single Line Capacity (C) = ((24 Hour * 60 min) * E / (T + t))/2 T = Total time taken by slowest Train in Ruling Section (Longest section) 1 Train Averag
Slide 43: Links to additional documents
adani Ports and Logistics Links to additional documents RPT Policy : (Link) Out come of the board meeting was intimated to the Stock Exchanges on 03 March 2021, followed by a audio call with Investors (Link to the Transcript), Details for agencies appointed for valuation, fairness opinion (Link)
Slide 44: Disclaimer
Disclaimer Certain statements made in this presentation may not be based on historical information or facts and may be “forward-looking statements,” including those relating to general business plans and strategy of Adani Ports and Special Economic Zone Limited (“APSEZL”),the future outlook and grow
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