Ksk Power Regulatory News (KSK)

KSK Power Ventur plc

Interim Management Statement

KSK Power Ventur plc ("KSKPV" or "the Company" or including any of its group companies "the Group"), the power project company listed on the London Stock Exchange, with interests in multiple power plants and businesses across India, today issues its Interim Management Statement for the period from 1 April 2012 to the date of this announcement. References to "the Group" are to KSKPV and its subsidiary companies.

Operational developments in the power plants include:

·; 540 MW WARDHA POWER COMPANY LIMITED (WPCL):

The total gross power generated in the plant during the last four months stood at 1266.88 MU with an average Plant Load Factor (PLF) of 80% with the month of June 2012 recording gross generation of 326 MU. The Company continues its efforts to optimize plant performance through a combination of enhanced sales of power, fuel availability and generation optimization along with pursuing potential debt refinancing opportunities.

·; 135 MW VS LIGNITE POWER PRIVATE LIMITED (VSLP):

The total gross power generated in the plant during the last four months stood at 352.75 MU with an average PLF of 89%. VSLP is continuing its efforts on securing appropriate legal reliefs with respect to tariffs from industrial customers. The Company anticipates that industrial customers, who have been experiencing extremely high alternate tariffs and recent increases in costs from local utilities, will find our power plant supplies attractive and agree to our proposition. Also, the Company is continuing its ongoing efforts to increasing efficiency of operations.

·; 86 MW ARASMETA CAPTIVE POWER COMPANY PRIVATE LIMITED (ACPCPL):

The total power generation for the last four months is at 95.57 MU with an average PLF of 48% for the operational period since the plant was shut down between April 25th 2012 and 19th May 2012. The Group began pursuing remedial actions to implement the committed power purchase agreements with Lafarge and will continue to pursue this action during the current year.

·; 58 MW SAI REGENCY POWER CORPORATION PRIVATE LIMITED (SRPCPL):

The total power generation for the last four months is at 163.63 MU with an average PLF of 89% in the combined cycle gas based power plant. Power is supplied to captive consumers against the committed long term Power Delivery Agreements, as well as other industries, utilities and third party consumers on a shorter term basis. The Group anticipates sound financial parameters over the year to continue at this site.

·; 43 MW SITAPURAM POWER LIMITED (SPL):

The total gross power generation during the last four months stood at 110.39 MU with an average PLF of 86%. The cost of coal was higher than anticipated on account of higher coal prices from The Singareni Collieries Company Limited, as well as from open market supplies.

·; CONSTRUCTION PROGRESS ON 3.6 GW KSK MAHANADI POWER PROJECT:

As regards the 3.6GW KSK Mahanadi (6X600 MW) Thermal Power Project under construction, the immediate focus and priority continues with respect to the first two units of 600 MW each, to ensure their balance with the plant site, as well as synchronizing them with planned fuel supplies. In regards to the on-site construction progress during the review period, there was continued activity on civil works with respect to the Boilers, Electrostatic Precipitators, Chimney, together with construction works with respect to the main Power House Building, Turbine Generator foundations, 400 kV Switchyard, Coal Handling Plant, Cooling Towers and Raw Water Reservoir, which are all in a good stage of construction progress. The Boiler Drum lifting for the initial three units has been achieved and the Boiler Hydro test for the first unit was completed during July 2012.

Fuel security for the initial units of this large private power plant has been secured through access to the Gare Pelma coal block along with coal linkage. With continued progress on construction at the power plant being achieved, we anticipate the Government of India being able to offer a favourable solution in the coming months with respect to the coal supplies for the balance units, if permission on Morga-II is not forthcoming.

Also, while construction activity of this large, single location, green-field project has seen good progress during recent months, the commissioning schedules are being planned to synchronize with the planned fuel supplies and stabilization. As a result, at least the first unit of 600 MW is now anticipated to commence power generation before end of the financial year 2012-13 and subsequent units during 2013 and 2014.

In recent months, notable progress has been achieved in the water infrastructure, rail infrastructure to support coal transportation needs and the mine development initiatives related to the KSK Mahanadi.

Hydro Power Initiatives

The detailed project reports and geo technical studies for hydro projects in Arunachal Pradesh have been completed and the Group anticipates collaboration with experienced and reputed power plant developers as a potential basis to move forward to the next stage of development and capital commitment of these large hydro initiatives.

Solar Power Initiatives

The Solar energy generation side of the Group has gained additional momentum with the recent securing of a project award to set up 10 MW of solar power generation plant in the state of Rajasthan under the Jawaharlal Nehru National Solar Mission, linked with a power purchase agreement for 25 years with the prescribed government agency. We anticipate construction of this plant in the current financial year and further the renewable initiatives of the group.

Financial Performance:

The financial performance during the three months of April - June 2012 at the Indian subsidiary KSK Energy Ventures Limited (under Indian GAAP) was announced on 4th August 2012 and demonstrated movement forward with Gross Income of Rs 5554 million as against Rs 4423 million for the similar period during the previous year and EBIDTA of Rs 2095 as against Rs 4423 million for the similar period during the previous year

The period under review continued to be testing times for the power sector in India and the Indian economy as a whole with the currency depreciation of the Indian Rupee against the US Dollar leading to significant foreign currency translation differences, together with increasing costs of imports - both in capital goods and raw materials. We anticipate that notwithstanding these challenges across the sector, the underlying assets and associated financial performance will continue to meet expectations.

Outlook

The KSK Group has in aggregate an operating power project asset portfolio of 881 MW coupled with the 3.6 GW project under execution and expect significant margin improvement on these operations in the coming year as increased asset utilization and lower cost fuel supply is implemented at the Wardha Warora Power Plant. We anticipate construction of 10 MW of Solar power generation plant in the State of Rajasthan in the current financial year. We are currently focused on being amongst the top power producing companies in India with a target of an operational power project asset portfolio of approx. 4.5 GW by the end 2014 along with clearly established fuel security with a low cost generation model.

We feel well positioned to benefit from developments in the industry and will continue to work closely with the Government and regulators as well as other participants in the market to produce efficient and much need power to the Indian economy.

For further information, please contact:

KSK Power Ventur plc

Mr. S. Kishore, Executive Director

Mr. K. A. Sastry, Executive Director +91 40 2355 9922

Arden Partners plc

Richard Day 44 (0) 20 7614 5900