Ksk Power Regulatory News (KSK)

29 November 2011

KSK Power Ventur plc("KSKPV" or the "Company" or the "Group")

Interim Results for the 6 months ended 30 September 2011

KSK Power Ventur plc (KSK.L), the power project company listed on the London Stock Exchange, with interests in multiple power plants and businesses across India, is pleased to announce the interim un-audited results for the six months ended 30 September 2011.

Financial Highlights

·; Group Revenue increased 124% to $182.97m (H1 2010: $81.85m)

·; Gross Profit increased 23% to $54.98 m (H1 2010: $44.74m)

·; Operating Profit increased 9% to $43.92m (H1 2010: $40.32m)

·; Investments in Property Plant and Equipment increased 18% to $2,306m (Mar 2011: $1,955m)

Operational Highlights

·; Operating capacity at 933 MW recorded an aggregate generation of 2,252 million units ("MU") as against 2,793 MU for the entire previous year of 2010-11, with the following individual plant wise Plant Load Factors ("PLF")

·; Construction assets of 3,720MW with good progress being made at 3,600MW KSK Mahanadi power project.

·; More than 6 GW of development opportunities under planning stage including development of 1.8 GW thermal power project in Orissa based on Naini coal block.

Commenting on the results, T.L.Sankar, Chairman of KSKPV said:

"During the first half, KSKPV made good progress on the Mahanadi site and remains on track to deliver power from this plant in late 2012. The Wardha power plant operated at lower PLF through the period due to local government decision making and more specifically open access permitting for power supplies. The Company has made considerable progress on this issue and anticipates supplies to industrial consumers to begin very shortly with an associated increase in PLF of the Wardha project, once such permission comes through.

The Reserve Bank of India has made numerous rupee interest rate rises on its lending to banks in India. As a consequence, the banks have also been passing on such increases and the Group is currently formulating necessary plans to refinance its bank funding, more specifically for the operating assets including Wardha. The Company anticipates that with these alternatives, if successful, it should bring interest payments back to originally planned amounts.

It is our belief that sustainable and continual progress by power plant developers requires them to: have a low cost structure base; be innovative; have the ability to adapt to the changing situations including addressing government policy asymmetries; and have a flexible approach on the ground, so as to develop and implement strong and sustainable power generation assets.

We look forward to the future as KSKPV emerges as one of the stronger and more stable players in the Indian power generation landscape."

For further information, please contact:

Key business updates

Wardha Warora 540MW

While the Company is currently receiving part of its coal requirements from linkage supplies and its dependence on short term e-auction coal / contracts has come down, the Company anticipates shortly receiving the confirmation of full quantity supply commencement from cost plus blocks. This will allow the plant to run at the planned load factor of 85% and above current levels. Commencement of this cost block coal supply is expected to commence once the necessary agreement is executed. KSKPV also expects that once open access power supplies to industrial consumers commence, the asset utilisation and associated revenue realisation of the Wardha plant will further strengthen.

 Other Operating Power Assets 393 MW

The other operating projects, consisting of thermal and wind energy projects, have been demonstrating sustained generation, with Sai Regency providing exceptional operating and financial performance during the current period. Certain localised issues have impacted the PLF of the smaller coal based assets of Arasemta and Sitapuram and we expect a catch-up during the second half for sustained generation from these as well.

On power pricing and realisations, we anticipate that industrial customers, who have been experiencing extremely high alternate tariffs from local utilities and who would see further increases from utilities on account of fuel surcharges, will continue to find our power plant tariffs attractive and validate the captured business model.

KSK Mahanadi 3.6 GW

The construction activity of this large, single location, greenfield private power plant at KSK Mahanadi has witnessed good progress during the recent months. The second half of the current year will witness certain interim milestone completions with respect to the first two units of 600 MW each and this should facilitate the commencement of power generation from these two units during the second half of 2012. Some of the immediate term objectives with respect to the KSK Mahanadi asset include:

o Immediate focus and priority with respect to the first two units of 600MW each and supporting common infrastructure for synchronisation during calendar year 2012.

o The Boiler Hydro Test for the first unit is expected to be completed in the Jan-Mar 2012 quarter and the next unit taken up thereafter. First Chimney is expected to cross the 150 metre level and is on programme for timely completion.

o Continued progress on the balance four units of 600 MW each with the Boilers Drum Lifting expected at periodic intervals through the 2012 and 2013 calendar years.

Fuel security for the initial units of this large project has been planned through access to the Gare Pelma coal block and / or associated coal linkage. In planning for the second phase of commissioning of the balance units suitable fuel solution with respect to re-instating or replacing the Morga-II capture coal block continues to be anticipated. With continual progress on the power plant, we anticipate that the Government of India will offer a favourable solution in the coming months with respect to the coal supplies for the balance of the units if permission from the Government of India on Morga-II is not forthcoming.

JR Power 1.8 GW

A thermal initiative of the group, JR Power has experienced initial progress in Orissa, based on guaranteed coal supplies from the Naini coal block by Pondicherry Industrial Promotion Development and Investment Corporation ("PIPDIC"). KSKPV is currently engaged in the land acquisition process along with the state government and is also undertaking initial discussions with potential engineering and construction contractors.

Hydro

With regards to the hydro project portfolio in Arunachal Pradesh, the Group anticipates collaboration with large reputed hydro power plant developers as a potential basis to move forward to the next stage of development of these hydro initiatives totalling close to 3+ GW.

Wind Initiatives

The Group continues its efforts on this portfolio and has recently secured an allotment of approx 300MW of wind generation capacity concessions in the state of Karnataka and Andhra Pradesh. The Company is planning the necessary preparatory work, including land acquisition efforts and advance equipment ordering to develop these concessions into large wind generation farms.

Mineral Interests

In addition to facilitating the development of 210MT Gare Pelma Sector III coal block in anticipation of commissioning the first two units at Mahanadi in late 2012, the Group is working on multiple coal development opportunities with a strategy to leverage the mining expertise and undertake Mine Developer & Operator work on high opportunity mineral resources of both steam and metallurgical coal specifications. This would also enable the Group to strengthen the coal supplies for its power plants.

Financial Performance

The performance during the current period has been held back due to the significant rise in fuel costs and non cash book adjustments for foreign exchange on the offshore supplies with respect to the Mahanadi project. While gross revenue has increased significantly from $81.85m to $182.97m reflecting the robust underlying growth in our operations, operating profits moved up marginally from $40.32m to $43.92m reflecting the margin squeeze primarily on account of rising fuel costs.

The significant increase of finance costs from $21.31m to $98.22m, first on account of raising finance costs and secondly on account of unrealised currency exchange effects with respect to offshore supplies to the Mahanadi project during the current period) resulted in a decrease in earnings before taxes.

The Profit After Tax ("PAT") pre MTM* stood at $0.64m (six month period ended 30 September 2010: PAT pre MTM* of $38.31m).

Loss After Tax post MTM* stood at $35.71m (six month period ended 30 September 2010: PAT after MTM* of $37.31m).

* MTM (Mark to Market) is on account of the restatement of the foreign currency loans and trade payables. There is no MTM impact on cash flows during the period.

Tender offer

As previously announced, a total of 74,526,091 shares in KSKEV have been acquired, mostly by the Indian subsidiary, under the tender offer and in total the Group now owns 279,232,677 shares in KSKEV, representing 74.94 per cent of the issued share capital of KSKEV, through the following companies:

KSK Energy Limited, Mauritius 191,222,031 (51.32%)

KSK Power Holdings Limited, Mauritius 8,665,639 (2.33%)

KSK Energy Company Private Limited, India 79,345,007 (21.29%)

This acquisition under tender offer for shares in KSKEV has been funded through rupee debt financing at the acquiring Indian subsidiary. The terms of financing include an initial moratorium with repayment periods spread over 3 to 5 years thereafter. The facilities have been secured by the pledge of shares in KSKEV acquired and held by the Group.

Outlook

The Indian economic growth potential and unfulfilled demand for power generation is expected to continue through the coming decade in spite of temporary disruptions. KSKPV is well positioned in this regard and expects significant margin improvement in the coming year as increased asset utilisation on commencement of supplies to industrial consumers, cheaper fuel supply is implemented at the Wardha Warora power asset and potential refinancing are achieved.

We look forward to the future as KSKPV emerges as one of the stronger and more stable players in the Indian power generation landscape.

An extract of the Interim Condensed Consolidated and Company Financial Statements for the six months ended 30 September 2011 is shown below. A full set of accounts is available from the Company website: www.ksk.co.in/investor

INTERIM CONSOLIDATED AND COMPANY STATEMENT OF COMPREHENSIVE INCOME

for the six months ended 30 September 2011

(All amount in thousands of US $, unless otherwise stated)

(See accompanying notes to the interim condensed Consolidated and Company financial statements)

Approved by the Board of Directors on 28 November 2011 and signed on behalf by:

S. Kishore K. A. Sastry

Executive Director Executive Director

INTERIM CONSOLIDATED AND COMPANY STATEMENT OF FINANCIAL POSITION

as at 30 September 2011

(All amount in thousands of US $, unless otherwise stated)

(See accompanying notes to the interim condensed Consolidated and Company financial statements)

Approved by the Board of Directors on 28 November 2011 and signed on behalf by:

S. Kishore K. A. Sastry

Executive Director Executive Director

INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

for the six months ended 30 September 2010

(All amount in thousands of US $, unless otherwise stated)

INTERIM COMPANY STATEMENT OF CHANGES IN EQUITY

for the six months ended 30 September 2011

(All amount in thousands of US $, unless otherwise stated)

(See accompanying notes to the interim condensed Consolidated and Company financial statements)

(See accompanying notes to the condensed interim consolidated and Company financial statements)