Trinity Capital Regulatory News (TRC)

26 Nov 2007 07:01

Trikona Trinity Capital PLC26 November 2007 Trikona Trinity Capital PLC ("Trikona TC" or "the Company") Interim Results for the six months ended 30 September 2007 Trikona Trinity Capital PLC (AIM: TRC), a fund created for investing in Indianreal estate and infrastructure and managed by Trikona Capital, announces itsInterim Results for the six months ended 30 September 2007. Highlights Financial • At 30 September 2007 the Company's portfolio was valued at £357 million, an increase of 82% against capital committed of £196 million. This compares to a portfolio value of £216 million on £124 million invested for the period ending 31 March 2007 • The Company's portfolio consists of twelve investments comprising a total development potential of 72 million sq. ft • Net Asset Value ("NAV") per share increased by 16% in the period from 124 to 144 pence, representing an increase of 53% since Admission • On an IFRS basis, £64 million of the revaluation gain is recognised in the financial statements for the period. (Since Admission the amount recognised is £108 million) • Interest income of £3.5 million (2006: £5.2 million) • Profit before tax of £42.9 million (2006: £2.6 million) • EPS of 18.5 pence (2006: 1.04 pence) Operational Key investments: •Trikona TC made the following investments amounting to £72.2 million: • £38.4 million in Development Project 10-Luxor Cyber City, a 67 acre IT/ ITES Special Economic Zone (SEZ) • £26.4 million in Development Project 11-DB Realty, a leading Mumbai developer with over 21 million sq. ft. under development • £7.4 million in Equity Holding 12-Phoenix Mills, a leading Indian retail developer with over 15 million sq. ft. under development After the period end Significant developments in existing projects: • Development Project 5: Manjeera Retail Holdings: • £3.1 million of second tranche investment The Company struck a landmark deal with SachsenFonds GmbH ("SF") to realiseassets for a gain of 108%: • Minority stake taken by SF in four of Trikona TC's off-shore entities that own Indian real estate for a total consideration of £32.1 million • The first AIM-quoted fund focused on India to successfully demonstrate tangible gains from investments in the Indian real estate market • The transaction supports the Company's stated NAV Michael Cassidy CBE, Chairman of Trikona Trinity Capital PLC said: "The last sixmonths represents another significant period of progress for the Company.Trikona TC continues to deliver on its IPO promises and has begun to realisecash returns on its investments. India's macro-economic progress and theCompany's achievements to date reflect the Board's view that the Indian realestate market offers excellent long term value to its investors. The Company isconfident it can continue to deliver strong returns to shareholders." Enquiries Trikona Trinity Capital PLC managed by Trikona Capital LimitedAashish Kalra, Managing Director +91 1146596000Ashesh C. Shah, Head of UK and Global Head of Corporate Development +44 207 8703454 Bell Pottinger Corporate & Financial +44 20 7861 3232 Nick LambertAmy Rajendran Gutenberg CommunicationsHarjiv Singh (New York) +1 212 209 3863Pranav Kumar (New Delhi) +91 98100 77898 Numis Securities Jag Mundi +44 20 7260 1000Charles Farquhar Chairman's Statement I am pleased to report Trikona Trinity Capital's Interim Results for the sixmonths to 30 September 2007. During this period, the Company completed buildinga portfolio that captures the strong growth experienced in India's real estateand infrastructure markets between 2006 and 2007. The Company is now fullyinvested and beginning to realise its assets. The Company's diverse portfolio of twelve investments across seven asset classesof residential, commercial, retail, hospitality, urban rejuvenation,infrastructure, and logistics, range in scope from specific development projectsto equity stakes in companies where the Company takes an active role in growingthe underlying business. Trikona established its leading position in the market by attracting otherindustry players such as Lehman Brothers / Goldman Sachs / New York Life /Citadel and IL&FS to follow or co-invest alongside its investment decisions. Inline with the Company's own growth strategy, Trikona TC will leverage thisleadership position as it focuses on realising and reinvesting gains on itsinvestments. The Company took the first step in this direction by completing a transactionwith SachsenFonds GmbH, recognising tangible gains on its portfolio anddemonstrating the strength of the Indian real estate market and the valuationsachievable. Additional realisations should come from Trikona TC's strategic stake in variouspre-IPO companies, making it possible to capture part of the potential increasein valuations seen on the Bombay Stock Exchange. By entering into ventures suchas DB Hospitality (DP-6), Pipavav Shipyard Limited (EH-8) and DB Realty (DP-11)at a very early stage, where Trikona TC took an active role in the developmentof these companies, we expect to see significant returns from subsequent publicofferings. Trikona TC's portfolio centres on Delhi and Mumbai where the GDP rate exceedsthe national average of over 8 % per annum. On the back of this strong market,Trikona TC expects to continue to realise gains in its portfolio and pursueadditional investments from its rich pipeline of deals. Outlook During the period, the fair value of our investments has grown by 16%. TrikonaTC continues to deliver on its IPO promises and with the fund now fullyinvested, we enter a phase in which assets will be realised and proceedsreinvested. Given the Company's early strategic decision to emphasise investment in areasthat experience higher growth than the national average, Trikona TC is wellplaced to take full advantage of a diverse and innovative portfolio. We areconfident of the long term economic health of the Indian real estate market andwe will continue to realise asset value where appropriate, and to recycle theproceeds back into the business. After period end, the Company's business model was proven with the realisationof assets by sale to SachsenFonds GmbH. Trikona TC is the first Company of itskind to make real money from this potentially lucrative market and our expertisein the market has gained the recognition of leading financial institutions whohave, in some cases, invested alongside us. Going forward, we continue to seekstrong returns for our shareholders. Condensed Consolidated Financial Information for the six months to 30 September 2007 Condensed consolidated interim income statementfor the six months to 30 September 2007 Notes Unaudited Audited Unaudited 1 April 7 March 2006 7 March 2006 2007 (date of (date of to incorporation) incorporation) 30 to to September 31 March 2007 30 September 2007 2006 £'000 £'000 £'000 Interest received 3,475 9,077 5,200Foreign exchange loss 3 (53) -Fair value gains on investments 6 63,698 44,346 -Net investment income 67,176 53,370 5,200 Investment manager's management fees 5 (2,500) (4,736) (2,233)Investment manager's performance fees 5 (20,771) (13,130) -Other administration fees and expenses (1,031) (1,493) (329)Profit for the period before tax 42,874 34,011 2,638Tax - - -Profit for the period after tax 42,874 34,011 2,638 Basic and diluted earnings per share(pence) 4 18.5 13.6 1.04 Condensed consolidated interim balance sheetat 30 September 2007 Notes Unaudited Audited Unaudited 30 September 31 March 2007 30 September 2007 2006 £'000 £'000 £'000 Non-current assets Investments 6 258,284 122,442 - Property plant & equipment 53 Total non-current assets 258,337 122,442 106,089 Current assets Trade and other receivables 189 106 346 Cash and cash equivalents 50,504 123,705 240,308 Inventory 23,299 22,309 - Prepayments 175 18 - Total current assets 74,167 146,138 240,654 Total assets 332,504 268,580 240,654 Liabilities Non-current liabilities Performance fee 5 (33,901) (13,130) - Borrowings (1,341) (1,603) - Total non-current liabilities (35,242) (14,733) - Current liabilities Trade and other payables (889) (154) (26) Total current liabilities (889) (154) (26) Total liabilities (36,131) (14,887) (26) Net assets 296,373 253,693 240,628 Represented by: Ordinary shares 3 2,321 2,321 2,528 Distributable reserve 217,362 217,362 Share premium - - 235,462 Retained reserves 76,885 34,011 2,638 Other reserves (195) (1) - 296,373 253,693 240,628 Condensed consolidated interim statement of changes in equityfor the six months to 30 September 2007 Unaudited Audited Unaudited 1 April 7 March 7 March 2007 to 2006 to 2006 to 30 31 March 30 September 2007 September 2007 2006 Share Distributable Retained Other Total Total Total Capital reserves Earnings Reserves £'000 £'000 £'000 £'000 £'000 £'000 £'000 Balance at the start of theperiod 2,321 217,362 34,011 (1) 253,693 - - Share issue proceeds - - - - - 250,028 250,028 Placing costs - - - - - (12,038) (12,038) Share buy back - - - - - (18,307) - Net profit for the period - - 42,874 - 42,874 34,011 2,638 Foreign exchange on translationof subsidiaries - - - (194) (194) (1) - Balance at the end of theperiod 2,321 217,362 76,885 (195) 296,373 253,693 240,628 Condensed consolidated interim cashflow statementfor the six months to 30 September 2007 Unaudited Audited Unaudited 1 April 2007 7 March 2006 7 March 2006 to 30 (date of (date of September incorporation) incorporation) 2007 to 31 March to 30 2007 September 2006 £'000 £'000 £'000 Profit for the period 42,874 34,011 2,638Adjustments for:Fair value gains on investment (63,698) (44,346) -Finance income (3,475) (9,077) (5,200)Depreciation: property plant & equipment 3 - - Changes in working capitalIncrease in inventories (1,175) (570) -Increase in receivables (239) (124) (346)Increase in payables 21,502 13,220 26Net cash used by operating activities (4,208) (6,886) (2,882) Cash flows from investing activitiesPurchase of investments (72,144) (78,096) -Purchase of property plant & equipment (56) - -Interest received 3,475 9,077 5,200Acquisition of subsidiaries, net of cash acquired - (17,643) -Net cash (outflow) / inflow from investing activities (68,725) (86,662) 5,200 Cash flows from financing activitiesProceeds on issue of equity shares net of issue costs - 237,990 237,990Share buy-back - (18,307) -Loan repayments (333) (2,429) -Net cash (outflow) / inflow from financing activities (333) 217,254 237,990 Net (decrease) / increase in cash and (73,266) 123,706 240,308cash equivalents Cash and cash equivalents at the start of the period 123,705 - -Foreign exchange 65 (1) -Cash and cash equivalents at the end of the period 50,504 123,705 240,308 Selected notes to the condensed consolidated financial informationFor the six months to 30 September 2007 1. General information The Company is a closed-end investment company, incorporated on 7 March 2006 inthe Isle of Man as a public limited company. It was admitted to the AlternativeInvestment Market of the London Stock Exchange on 21 April 2006. The Group invests in real estate and estate related entities in India, primarilyin commercial development in the office and business space, residential, retailand hospitality sectors deriving returns from development, long-term capitalappreciation and income. The condensed consolidated financial information comprises the results of theCompany and its subsidiaries (together referred to as the "Group") and isunaudited. 2. Accounting policies Basis of preparation This condensed interim financial information for the period ended 30 September2007 has been prepared in accordance with IAS 34, Interim Financial Reportingand on a basis consistent with the accounting policies set out in the Company'saudited annual report and accounts for the period ended 31st March 2007. The financial information has been presented in Sterling. Investments Investments of the Group where the Group does not have control are initiallyrecognised at cost at the date of investment. Investments are subsequentlyre-measured at fair value at least every six months by the Directors using thevarious methods described below. Unrealised gains and losses arising from therevaluation of investments at the period end are taken directly to the incomestatement. Investments in entities over which the Group has control are consolidated inaccordance with IAS 27. Fair value for unquoted securities is estimated by the Directors using the mostappropriate valuation techniques for each investment. Securities quoted or traded on a recognised stock exchange or other regulatedmarket are valued by reference to the last available bid price. Segment reporting A business segment is a group of assets and operations engaged in providingproducts or services that are subject to risks and returns that are differentfrom those of other business segments. A geographical segment is engaged inproviding products or services within a particular economic environment that aresubject to risks and return that are different from those of segments operatingin other economic environments. The directors are of the opinion that the Group is engaged in a single segmentof business being property investment business in one geographical area beingIndia. 3. Share capital Issued share capital No. of £ sharesOrdinary shares of £ 0.01 each 231,800,200 2,318,002Deferred shares of £0.01 each 250,000 2,500 232,050,200 2,320,502 The Deferred Shares rank pari passu with the Ordinary Shares. There are7,575,000 options outstanding which were issued at the date of admission to AIM,giving the right to subscribe for shares at £1 per share from the firstanniversary to the fifth anniversary of admission to AIM. 4. Basic and diluted earnings per share The basic and diluted earnings per share is calculated by dividing the gains forthe period attributable to ordinary shareholders by the weighted average numberof shares outstanding during the period: Unaudited Audited Unaudited 30 September 31 March 30 September 2007 2007 2006Profit attributable to ordinary shareholders of the Company (£'000) 42,874 34,011 2,638Weighted average number of shares in issue ('000) 232,050 249,491 252,750Basic earnings per share (pence) 18.5 13.6 1.04 There are no dilutive potential ordinary shares and therefore diluted earningsper share is the same as basic earnings per share. 5. Investment manager fees and performance fees In consideration of the Manager providing management services, whether itself orthrough subcontractors, the Manager receives a management fee of 2 per cent. perannum of the amount subscribed on the issue of the Placing Shares plus returnsfrom investment retained by the Group for further investment. With effect from31 March 2007 this fee is payable quarterly in advance. The Manager is entitled to a carried interest (performance fee) which aligns itsinterest with those of the Shareholders subject to meeting minimum returns. Thehurdle is 10 per cent IRR on relevant investment ("Hurdle"). Following the saleof an investment, if the Hurdle has been met, the Manager will be entitled toreceive a profit share of 20 per cent. of the gain generated by the Group inrespect of that investment, provided that if the IRR exceeds 20 per cent., theManager shall be entitled to 30 per cent. of the gain in respect of thatinvestment. A provision of £33,901,000 has been made in respect of the relevantfair value investment gains recognised in the financial statements as at 30September 2007. 6. Investments Investments are recorded at fair value as follows: Cost Fair value Fair value adjustment £'000 £'000 £'000Balance at 30 September 2006 - - -Movement 78,096 44,346 122,442Balance at 31 March 2007 78,096 44,346 122,442Movement 72,144 63,698 135,842Balance at 30 September 2007 150,240 108,044 258,284 Made up as follows:Quoted investments 20,898 (3,186) 17,712Unquoted investments 129,342 111,230 240,572Balance at 30 September 2007 150,240 108,044 258,284 7. Group Entities Subsidiaries Country of Ownership Subsidiaries Country of Ownership incorporation interest incorporation interest Trinity Capital Trinity Capital Mauritius 100%Mauritius Limited Mauritius 100% (Ten) Limited Trinity Capital Trinity Capital Mauritius 100%(One) Limited Mauritius 100% (Eleven) Limited Trinity Capital Trinity Capital Mauritius 100%(Two) Limited Mauritius 100% (Twelve) Limited Trinity Capital Trinity Capital (Three) Limited Mauritius 100% (Thirteen) Limited Mauritius 100% Trinity Capital Trinity Capital (Four) Limited Mauritius 100% (Fourteen) Limited Mauritius 100% Trinity Capital Trinity Capital (Five) Limited Mauritius 100% (Fifteen) Limited Mauritius 100% Trinity Capital Trinity Capital (Six) Limited Mauritius 100% (Sixteen) Limited Mauritius 100% Trinity Capital Trinity Capital (Seven) Limited Mauritius 100% (Seventeen) Limited Mauritius 100% Trinity Capital Trinity Capital (Eight) Limited Mauritius 100% (Eighteen) Limited Mauritius 100% Trinity Capital Mauritius 100% Uppals I.T. (Nine) Limited Projects Private Limited India 100% Uppals I.T. is a wholly owned investment of Trinity Capital (One) Limited andhas been consolidated. No fair value adjustment has been included in theconsolidated financial statements in relation to this company. 8. Commitments As at 30 September 2007 the Group had capital commitments of £22,814,000 inrespect of capital expenditures contracted for at the balance sheet date but notyet incurred. 9. Related party transactions Rakshitt Chugh is a Director of the Company and of the Investment Manager. Fees charged by the Investment Manager, including performance fees, aredescribed in note 5. The Investment Manager or its affiliates has a controlling interest in PantheraDevelopers Private Limited, which is the developer of Uppals IT Projects PrivateLimited and co-developer of Luxor Cyber City, and in Enfield Property ManagementServices Private Limited which is the property manager for Lokhandwala KatariaConstructions Private Limited, Manjeera Retail Holdings Private Limited, UppalsIT Projects Private Limited, Neelkamal, MK Malls Private Limited and Luxor CyberCity. In addition they have a controlling interest in Broadgate SecuritiesLimited which is entitled to receive a selling fee from the Company amounting to3% of the sales proceeds of any disposals made by the Group, inclusive of anyfees payable to sub-agents, for a period of one year from 1 October 2007. Rakshitt Chugh has majority ownership in Byte Consulting, a consultancy whichprovided data and financial analysis to the Group during the period. Philip Scales is a director of the Company and of the Administrator. The fees ofthe Administrator for the period amounted to £ 31,000. 10. Events after the balance sheet date On 17th November 2007, the Group sold part of its shareholding in TrinityCapital (One) Limited, Trinity Capital (Five) Limited, Trinity Capital (Six)Limited, and Trinity Capital (Ten) Limited for an aggregate consideration of£32.1 million. The selling price equalled the value at which the respectiveinvestments were carried as at 30 September in these financial statements. Operational Overview Development Project 1: Uppal IT Park - "Tech Oasis" Partner: Panthera DevelopersLocation: Greater Noida, NCR or DelhiProject Type: IT Park with residential, commercial and IT spaceSize: 9.98 million sq. ft.Asset Classes: Commercial, Residential and Hospitality Investment Details Capital Investment Date: 18 October 2006Capital Committed: £28.3 millionInvestment: £23.2 millionOwnership: 100% NAV NAV as of 31 March 2007 £76.3 millionNAV as of 30 September 2007 £81.0 millionValuation Gain for the period 6% Highlights • SEZ application has been forwarded to Central Government with a recommendation for formal approval from the State Government and the approval is expected before the end of the year • The Company is in the process of appointing a leading international architectural firm for the Project Project Overview Planning & development - Plans and estimates for the site office have been finalised Marketing and sales - Negotiations are underway for selling Floor Space Index (FSI) to prominentcorporate clients Regulatory - Revised master plan, prepared by HPP Consultants (Germany) submittedto Greater Noida Industrial Development Authority (GNIDA) o GNIDA approval expected soon - Environmental clearance due to be ready by Q1, 2008. Formal application for clearance from the Airport Authority expected by the end of 2007 Financing The Company is in advanced discussions with State Bank of India and BarclaysBank for a Term Loan facility for the project and in principle approval islikely to be received before the end of the year. Current area and rates Rates Asset Class Const. Rate (INR) Sales/Lease Rate (INR) IT/ITeS 1,700 /sq. ft. 35-40 /SFT/MonthResidential 1,250 /sq. ft. 2,750-3250 /sq. ft.Commercial 1,700 /sq. ft. 35-40 /SFT/MonthRetail 2,000 /sq. ft. 60-75 /SFT/MonthHotel 5,00,000/ Key 6500-7000 ARRFSI SaleIT - 1,000 /sq. ft.Commercial - 600 /sq. ft. Area Breakdown Asset Class Super Area (sq.ft.) Basement (sq.ft.) Total Area (sq.ft.) IT/ITeS 4,475,445 1,086,361 5,561,807 Residential 1,071,180 753,260 1,824,440 Retail 931,676 460,565 1,392,241 Hotel 240,000 - 240,000 Commercial (Non IT) 781,637 181,269 926,906 Total 7,499,938 2,266,942 9,981,395 Project Description Uppal IT Park, also known as Tech Oasis, is located in Greater Noida's Tech Zoneon the Taj Expressway Corridor, which will connect Greater Noida with Agra,Faridabad and Gurgaon. An emerging destination of choice for IT/ITES companies in the NCR, Tech Oasiswill be situated less than 50 kilometres away from the Central Business Districtof Delhi and the international airport, and be built on a 76 acre parcel of landwith excellent connectivity to key surrounding areas. Tech Oasis has been creatively designed to capture the energy and imagination ofIT workforce - young, educated and culturally sophisticated tech workers - in acomplete live, work and play environment. Unlike any other development inIndia, the Tech Oasis will evoke comparisons not to other Indian IT locales, butto areas such as Tokyo, Shanghai and New York. Development Project 2: Rustomjee's Township Partner: Kapstone Constructions Pvt. LtdLocation: Thane, MumbaiProject Type: Integrated TownshipSize: 9 million sq. ft. on 127 acresAsset Classes: Residential, Commercial and Retail Investment Details Capital Investment Date: 23 October 2006Capital Committed: £14.3 millionInvestment: £10.6 millionOwnership: 21.3% NAV NAV as of 31 March 2007 £20.3 million NAV as of 30 September 2007 £24.2 million Valuation Gain for the period 19.7% Highlights - Pre-sales are 14% higher than in the original business plan: o Average sales realisation for the total pre-sold area of USD88 /INR3,608 per sq. ft., 14% above the original budgeted amount - 31% of the area has been pre-sold - 1.5% higher than business plan: o 170,825 sq. ft. / 191 apartments sold Project Overview Planning & development - Site development for Phase 1 of the 127 acre project site is completealong with all requisite approvals and authorisation - Planning and designing for Phase 1 is complete. Phase 2 work is in progress - Construction and pre-sales of 500 apartments with a total area of 550,000 sq. ft. has commenced under Phase 1 in line with plans Current area and rates RatesAsset Class Const. Rate (INR) Sales/Lease Rate (INR) Residential 1,150 /sq. ft. 4,630-6200 /sq. ft.Commercial (L) 1,700 /sq. ft. 42.5-62.5 /SFT/MonthCommercial (S) 1,700 /sq. ft. 5,000-6500 /SFTRetail 1,700 /sq. ft. 60-72 /SFT/monthClub House 2,000 /sq. ft. Project Description Rustomjee's Township is one of the largest integrated developments in Thane, arapidly growing satellite town of Mumbai. Located only 40 kilometres fromcentral Mumbai's business centre, and adjacent to a major highway that connectsMumbai and Delhi, Rustomjee offers excellent access to all of Mumbai and itssurrounding areas. The integrated township, to be built on 127 acres in four phases over a 7-yearperiod, will feature over 9 million sq. ft., with a mix of residential,commercial and IT/ITeS space as well as a retail mall, educational, recreationaland healthcare facilities. The developer will focus on creating a totallifestyle environment at Rustomjee's Township with parks, nature walks,landscaping and innovative designs to minimize commuting time between work andhome Development Project 3: MK Malls Partners: Dynamix Balwas Group, Hafeez ContractorLocation: Bandra Kurla Complex, MumbaiProject Type: CommercialSize: 848,000 sq. ft. on 4.43 acresAsset Class: Urban Rejuvenation Investment Details Capital Investment Date: 3 March 2007Capital Committed: £17.6 millionInvestment: £17.6 millionOwnership: 29.9% NAV NAV as of 31 March 2007 £28.9 millionNAV as of 30 September 2007 £30.7 millionValuation Gain for the period 6% Highlights - Approval for a Floor Area Ratio (FAR) of 2.5 has been obtained - 65% of tenants paid and vacated from land: o Payment to, and resettlement of, the remaining tenants demolition of structures and site development ready for proposed construction expected to be completed by February 2008 o Construction activity set to begin by end of April 2008 with completion by November 2010 o Planning and designing of office towers is in progress - 650,000 sq.ft. of saleable area Project Overview Planning & development - Hafeez Contractor, a reputed architectural firm in India with many prestigiousprojects to its credit, has been appointed for Master Planning & Designing - Construction activity is expected to start by early 2008, after the site is cleared Current area and rates RatesAsset Class Const. Rate (INR) Sales/Lease Rate (INR) Commercial 2000 psft 265-300psft/monthBasement 450 psft 10,000/bay/month Area BreakoutAsset class Super Area (sq.ft.) Basement (sq.ft.) Total Area (sq.ft.) Commercial 648,673 199,592 848,264Total 648,673 199,592 848,264 Project Description MK Malls is a partnership with Dynamix-Balwas Group to develop commercial officespace in Mumbai's secondary business district, Bandra Kurla Complex. Offeringeasy accessibility and high quality amenities, the project is expected to becompleted within three years. The development offers Trikona TC an opportunityto tap into the large overflow of demand for commercial real estate in Mumbai. The developers propose to develop 650,000 sq.ft. of high quality office space insix buildings of approximately 108,000 sq.ft. each on a parcel of land measuringapproximately 4.43 acres. The commercial buildings will be stand alone blocksand efforts are being made so that each is leased out as an entire building tolarge corporate users. The offices will be constructed to Internationalstandards, providing easy accessibility and high quality amenities foremployees. The project is part of Trikona's larger Urban Rejuvenation Programme ("URP"),under which Trikona works with the local government to rehabilitate slums byrelocating existing inhabitants and redeveloping the area. In exchange for therights to build market rate housing, the Company agrees to provide new housingfor the existing residents. Development Project 4: Lady Ratan Seasons Partner: Lokhandwala, Hafeez Contractor (Architect)Location: Worli, Southern MumbaiProject Type: Residential spaceSize: 983,000 sq. ft. across 7 acresAsset Class: Residential Investment Details Capital Investment Date: 12 October 2007Capital Committed: £11.6 millionInvestment: £6.3 millionOwnership: 49.0% NAV NAV as of 31 March 2007 £22.3 millionNAV as of 30 September 2007 £23.7 millionValuation Gain for the period 6% Highlights - Rapid increases in land value has led to a reassessment of the development mixto include commercial floor space - 60% of the slum dweller occupants have been cleared - activity to be completedby the end of March 2008 - Environmental clearance and approval has been received from the State Government Project Overview Planning & development - Work for the first two rehabilitation buildings, comprising c. 90,000 sq. ft. has been completed and three slabs have been completed Marketing and sales - Pre-sales realisations likely to be launched in Q1 2008 Current area and rates RatesAsset Class Const. Rate (INR) Sales Rate (INR) Rehabilitation 700 /sq. ft.Residential 1,450 /sq. ft. 14,000 - 16,000 /sq.ft. Area BreakdownAsset Class Area (sq. ft.)Rehabilitation 700,293Saleable 672,830Basement 310,000Total 1,683,123 Project Description Lady Ratan Seasons is a luxury condominium development project located in Worli,Southern Mumbai. The development showcases Trikona's leading role in the Urban RejuvenationProgram ("URP"). Trikona TC will re-develop 7 acres into 983,000 sq. ft. ofresidential space. Under the URP, the project will provide approximately 700,000sq. ft. of new housing in three 31-story towers for existing residents and, inreturn, the project will receive the right to build approximately 983,000 sq.ft. of market rate premium sea view housing. Development Project 5: Manjeera Retail Holdings ("Manjeera") Partner: Manjeera Construction LTDLocation: Kukatpally, HyderabadProject Type: 2.7 million sq. ft. of commercial, residential & retail spaceSize: 2.7 million sq. ft. on 8.3 acresAsset Class: Residential, Commercial and Retail Investment Details Initial Capital Investment Date: 25 January 2007Capital Committed: £9.1 millionInvestment: £9.9 millionOwnership: 49.0% NAV NAV as of 31 March 2007 £14.9 millionNAV as of 30 September 2007 £15.8 millionValuation Gain for the period 6% Highlights Planning & development - Finalising project debt financing through HUDCO, OBC, Indian Bank, Bank of Baroda and SBI - Beginning construction following approvals from regulatory authorities Marketing and sales - Appointment of renowned international architect firm RSA to work on the project - Appointment of Jones Lang La Salle Meghraj as sole marketing agents for the project Regulatory - Receiving airport authority approval for height clearance Current rates RatesAsset Class Const. Rate (INR psft) Sales/Lease Rate (INR) Residential 1250 3,500-4500 psft Commercial 1,400 4,200-4350 psft Retail 1,800 60-65 psft pm Basement 500 660 psft Area BreakdownAsset Class Super Area (sq.ft.) Basement (sq. ft.) Total Area (sq.ft.) Residential 274,870 144,592 419,462 Commercial 833,068 335,977 1,169,045 Retail 671,953 438,224 1,110,177 Total 1,779,891 918,792 2,698,683 Project Description The project represents the Company's first entry into India's fifth largestcity, Hyderabad a rapidly growing metropolis with a population in excess of 6million. Strategically located on the road connecting Hyderabad to HI-TEC city,which is home to major technology firms such as Microsoft, Dell and Motorola.This project will feature 1.27 million sq.ft of office space, 1 million sq.ft ofretail and cinema multiplex space and 419,000 sq.ft. of residentialspace, developed over two adjacent land parcels measuring 3.2 and 5.1 acres,respectively. Manjeera is expected to be completed over the next three and ahalf years. Development Project 6: Neelkamal Marine Drive Partner: Dynamix Balwas Group Hospitality ("DB Hospitality")Location: Mumbai, Pune and GoaBusiness: Private: Development company and hospitality platformSize: 1 operating hotel & 3 new luxury hotels (1,036 keys)Asset Class: Hospitality Investment Details Capital Investment Date: 15 December 2006Capital Committed: £11.6 millionInvestment: £5.8 millionOwnership: 9.5% NAV NAV as of 31 March 2007 £14.5 millionNAV as of 30 September 2007 £16.6 millionValuation Gain for the period 14.5% Project Overview Planning & development - Approvals have been gained for planning and design for all three locations, and construction is well underway in Mumbai, Pune and Goa. One of the hotels based in Mumbai is fully operational Marketing and sales - Appointment of renowned architect, FX Fowle on this project Basic Operating Assumptions Project DescriptionEntity Name Place Status Brand Hotel Service Shopping Residential Keys Apt. (SFt) BD&P Hotels Mumbai Operational Le Meridien 171 Neelkamal MarineDrive Dev Mumbai Green Field HYATT 275 50 125,000 50 Goan Hotels Goa Green Field HYATT 324 20,000 Dynamix Balwas Resorts Pune Green Field HYATT 325 ARR AssumptionsARR (GBP/Key) 2007 2008 2009 2010 2011 2012 2013Mumbai Meridian 104 104 104 110 114 122 130Mumbai 0 0 0 177 186 195 205Goa 0 0 100 105 110 117 125Pune 0 0 0 115 120 127 133 Occupancy AssumptionsOccupancy (%) 2007 2008 2009 2010 2011 2012 2013Mumbai Meridian 80% 75% 75% 75% 85% 85% 85%Mumbai 70% 75% 80% 80%Mumbai Service Apts. 80% 70% 75% 75%Goa 60% 65% 70% 80% 85%Pune 60% 70% 75% 80% Project Description The partnership represents the foundation of India's premiere hospitalityplatform. The development group currently owns an operational 5 star hotel, Le RoyalMeridian, Mumbai and land to develop a further three luxury hotels over the nextthree years in Mumbai, Pune and Goa which will operate under the Hyatt brand. The group plans to develop a "Park Hyatt" in South Mumbai, which will be thetallest tower in Mumbai. Once completed the hotel will be the only luxury hotelin the area. Equity Development Holding 7: Fortis Healthcare Limited ("FHL") Partner: Ranbaxy GroupLocation: Pan IndiaBusiness Type: Public: India's leading healthcare companyReal Estate: Access to develop healthcare facilities & hospitalsSize: 12 Hospitals with plans for 30-40 in 5 yearsAsset Class: Infrastructure Investment Details Capital Investment Date: 15 January 2007Capital Committed: £13.5 millionInvestment: £13.5 millionShares Owned: 8 millionStock Exchange: Bombay Stock Exchange--Ticker: FortisTotal Shares: 3.5% Project Overview FHL is the only investment in the Company's portfolio that is currently tradingbelow the purchase price. Despite this the Company remains committed to theproject and with strong fundamentals, we expect the price to recover. Project Description The investment provides exposure to the rapidly growing hospitality sector,especially to lucrative Medical Tourism which is expected to become a £1 billionindustry by 2012. Trikona TC expects to capitalise on FHL's plans to develop 30-40 additionalhospitals over the next five years. FHL has also launched its network of healthshops branded "Fortis Healthworld", targeting 1,000 outlets by 2012. Equity Development 8: Pipavav Shipyard Limited ("PSL") Partner: SKILLocation: Pipapav Port, State of GujaratBusiness Type: Private: Developer of India's largest portSize: 175 acresAsset Class: Infrastructure Investment Details Capital Investment Date: 23 January 2007Capital Committed: £13.2 millionInvestment: £13.2 millionShares Owned: 45.9 million% Ownership: 9.73% Highlights - TTC remains very confident in PSL's future given forward order book in excess of US$1billion - Recent strategic partnership with Punj Lloyd Limited. Enables PSL to enter into the business of fabrication and construction of offshore platforms, single buoy moorings and rigs with minimum lead time. This offers excellent synergies with the shipbuilding business, providing an optimal utilisation of facilities, space and available waterfront - Development progress on target Sales and Marketing - Firm contracts have been entered into with three parties from Bermuda/Norway, France and Marshall Islands for construction of 22 nose 74500 DWT Paramax Bulk Carriers aggregating to US$872 million with an option for a further four nose ships of similar size valued at US $173 million - This represents a total order position of US$1.05 billion. The delivery schedule spans from March 2009 to December 2012 Asset update - Staffing, vendor selection and the acquisition of materials remain on target - Mobilisation is underway for construction of the dry dock with an expected completion date of 31 March 2008 - Construction of the compound wall for the ship yard site is also in progress Project Description The prospect is spread over 175 acres and is positioned to be the world's fifthlargest shipyard. A project of this scale will support the economic growth ofthe Pipavav area over the long-term. New York Life International Fund had invested £7.9 m in the shipyard at the samevaluation as Trikona TC. Other investors include Punj Lloyd and Citadel. Equity Development Holding 9: IL&FS Transportation & Networks Limited ("ITNL") Partner: IL&FSLocation: Pan IndiaBusiness: Private: Leading developer of Indian infrastructureSize: over 7,500 kilometres of roadsAsset Class: Infrastructure Investment Details Capital Investment Date: 5 October 2006Capital Committed: £4.8 millionInvestment: £4.8 millionShares Owned: 4.16 million Asset Update - Existing projects are generating revenues in the form of toll and annuities - ITNL is actively pursuing/ bidding for various projects covering improvement, up-gradation, rehabilitation and new development - ITNL has declared a maiden dividend of 20% to all equity shareholders for the year 2006/2007. Trikona TC received an amount of INR 22 MM as dividend income Project Description Following the Company's landmark £100 million partnership deal with India'sleading financial institution, Infrastructure Leasing & Financial ServicesLimited ("IL&FS"), the acquisition of a 2.6% stake in ITNL is the firstinvestment allocation. ITNL currently holds 10 road sub-sector projects in its portfolio and a strongpipeline for further growth and development in the transport sector. Subsequent to Trinity's investment, Goldman Sachs has also invested in thiscompany Development Project 10: Luxor Cyber City - "SEZ" IT/ITES Development ("LuxorCyber City") Partner: Uppals (India), Luxor Group (India)Location: Gurgaon, National Capital Region of DelhiProject Type: IT SEZSize: 8.18 million sq. ft. of IT/ITES on 67 acresAsset Class: Residential and Commercial Investment Details Capital Investment Date: 12 June 2007Capital Committed: £37.9 millionInvestment: £37.9 million plus capitalised costs of 0.5 = £38.4 millionOwnership: 49.4% NAV Invested Capital £38.4 million NAV as of 30 September 2007 £63.2 million Valuation Gain for the period 65% Highlights - Principal developer set to be appointed by January 2008. Once appointed, developer will proceed with: o Appointment of architects o Obtaining approvals for building permissions and environmental clearance - Project partner, Uppal Group, has secured an additional area, for which SEZ approval has been obtained in principle Project Description In terms of capital, Luxor Cyber City represents Trikona TC's largest investmentto date. The Company paid £37.9 million for a 49.4% stake in Luxor Cyber City todevelop an IT / ITES Special Economic Zone (SEZ) over a 67-acre land parcellocated in Gurgaon, National Capital Region of Delhi. Once developed, the project will offer a total of nearly 8 million sq. ft. ofIT/ ITES processing zone in the closest SEZ to Delhi. Development Project 11: DB Realty ("DBR") - Mixed Use Development Partner: Dynamix Balwas GroupLocation: MumbaiBusiness: Private: Development CompanyProject Type: prime commercial & residential spaceSize: 21.7 million sq. ft.Asset Class: Residential and Commercial Investment Details Capital Investment Date: 23 April 2007Capital Committed: £26.4 millionInvestment: £26.4 millionOwnership: 5.9% NAV Invested Capital £26.4 million NAV as of 30 September 2007 £41.6 million Valuation Gain for the period 57% Highlights - Construction has begun on five of the twelve projects - The Board of the Company has approved additional six projects, taking the aggregate number of projects in the portfolio to 18 Project Description DBR is a holding company for the purpose of undertaking various developmentprojects either directly through development rights or through Joint Ventures/Special Purpose Vehicles in Mumbai, India. Upon completion, the projects will result in the development of 21.7 MM sq. ft.of residential and commercial space and will significantly redefine thelandscape of central and suburban Mumbai where an acute shortage of quality realestate space has witnessed rental and property prices soar in the recent years. Lehman Brothers also subscribed to a 5.9% stake in this investment. Equity Development Holding 12: Phoenix Mills Limited ("PML") Partner: Atul Ruia GroupLocation: Pan IndiaReal Estate: PML portfolio: retail, commercial & hospitalitySize: 15 million square feetAsset Class: Retail, Commercial and Hospitality Investment Details Capital Investment Date: 22 June 2007Capital Committed: £7.4 millionInvestment: £7.4 millionShares Owned: 370,000Stock Exchange: Bombay Stock Exchange--Ticker: Phoenix Highlights - Shares acquired at a price of £19.95 per share, a discount to the then currentmarket price of £23.70 per share - Investment substantially increases TTC's retail portfolio in India's rapidly expanding retail sector Asset update - PML's existing plan to develop seven market cities in Mumbai, Nagpur, Chennai,Thane, Pune, Raipur and Bangalore is supplemented by being in the advanced stages of closing deals to develop an additional 10 market cities in various tier I and II cities across India - PML's flagship retail development is High Street Phoenix, a prominent commercial and residential location in Mumbai. Phases 1 and 2 were completed in2005 and have been completely sold or leased out. Phases 3 and 4 will consist ofretail, commercial, educational and hospitality space. These are underconstruction and are scheduled to be completed by 2010 Project Description The investment in PML further strengthens the Company's existing strong retailoffering in a sector that has already seen rapid growth in the past five yearsand is well positioned for further expansion going forward. PML's flagship development "High Street Phoenix" is a development in LowerParcel, South Mumbai that is a prominent commercial and residential location.Once fully developed, the area will occupy over 2.3 million square feet ofpremium retail space. Other institutional investors include Deutsche Bank, Yatra Capital andAmericorp. This information is provided by RNS The company news service from the London Stock Exchange