«TABLE OF CONTENTS DEFINITION, TECHNICAL GLOSSARY AND ABBREVIATIONS FORWARD-LOOKING STATEMENTS RISK FACTORS SUMMARY SUMMARY OPERATING AND FINANCIAL ...»
20,000 million each. The turnover of JAL for FY04 was Rs. 25,590.90 million. JAL owns construction plants, machinery and equipment worth over Rs. 8,000 million and has a work force (including contract labour) of over 30,000, comprising engineers, managers, administrators, foremen, supervisors, operators, technicians, skilled and unskilled workers JAL is also implementing the 400 MW Vishnuprayag and the 1,000 MW Karcham Wangtoo hydropower projects through its wholly owned subsidiaries. JAL’s specialization and core focus on construction of hydropower projects has made it one of the dominant players amongst the private sector with significant market share.
Some of the contracts successfully completed by JAL in the hydropower sector include those done in the following
1) Ukai Dam Project (left main canal and cross drainage works, tail race channel and allied works), Gujarat, completed in 1974
2) Salal Hydro-Electric Project (Excavation of Power House, Cut-off wall, Concrete protection wall) in Jammu and Kashmir completed in 1977
3) Gharwal-Rishikesh-Chilla Hydroelectric Project (Channel works and Barrage works) in Uttar Pradesh completed in 1979
4) Sardar Sarovar (Narmada) Project (Excavation of Dam Foundation, Excavation and concreting in Fault zone, Four Rockfill Dams and Block 1 to 20 of the Main Dam) in Gujarat completed in 1986
5) Tehri Hydro-Electric Project (two diversion tunnels, river bed excavation and upstream coffer dam excavation and fill placement, excavation of chute spillway) in Uttaranchal completed in 1986
6) Karjan Reservoir Project (100m high Karjan concrete gravity Dam) in Gujarat completed in 1987
7) Indra Sarovar (Bodhghat) Hydro-Electric Project (two Adit Tunnels and Power House pit) in Madhya Pradesh completed in 1987 8) 140 m high Chamera - I concrete gravity dam in Himachal Pradesh completed in 1993
9) Vadagam Saddle Dam and 250 MW capacity Canal Head Power House in Gujarat completed in 1998
10) Nathpa Jhakri Hydro-Electric Project (1500 MW) (Construction of Powerhouse) at River Satluj, at Jhakri, Himachal Pradesh completed in 2002
11) Baspa (Stage-II) Hydro-electric Project (300 MW) at river Baspa (tributary of river Satluj) District Kinnaur, Himachal Pradesh completed in 2003 JAL has established, in collaboration with Harza Engineering Company International, USA, a Heavy Engineering Workshop for precision fabrication and machining for manufacture of hydro mechanical equipment like gates, hoists and cranes for dams and barrages with an installed capacity of 3,000 tonnes per annum of fabricated and machined hydro mechanical equipments.
Some of the contracts being implemend/executed by JAL are:
1. Sardar Sarovar Project in Gujarat (1200 MW)
a) Construction of Concrete Dam
b) Construction of Underground River Bed Power House and appurtenant works
2. Indira Sagar (Narmada) Project in Madhya Pradesh (1000 MW)
a) Construction of Concrete Gravity Dam
b) Construction of Power House
3. Tehri Hydroelectric Project in Himachal Pradesh (1000 MW)
a) Rock Fill Dam and Associated Works
b) Construction of Chute and Shaft Spillway Structures
4. Dul Hasti Hydroelectric Project in Jammu & Kashmir (390 MW)
a) Civil works of Upstream area work(Package I)
b) Civil works of Downstream area work (package-II)
5. Vishnuprayag Hydroelectric Project in Uttaranchal (400 MW)
6. Tala Hydroelectric Project in Bhutan (1020 MW) a) Construction of Head Race Tunnel(RD 6,000m to RD 11,130m from
7. Padechu Adit (Package-C2)
a) Construction of Power House and Tail Race works (contract Package No.C5) Baglihar HE Project in J&K
b) Civil and Hydromechanical work of Baglihar Stage I HE Project (450MW)
c) Civil and Hydromechanical work of Baglihar Stage II H.E project (450 MW)
8. Teesta Hydroelectric project in Sikkim (510 MW)
a) Civil work for Coffer Dam, Concrete Dam, Desilting Chambers, Intake Structures etc. (LOT TT-2)
b) Civil work for Underground Power House, Surge Shaft, Pressure Shafts, Switchyard, Part HRT & TRT’s etc.(LOT TT-4)
9. Omkareshwar HE Project in Madhya Pradesh (520MW)
10. Karcham Wangtoo HE Project in Himachal Pradesh (1000MW)
11. Udhampur-Srinagar-Baramula New BG Railway line in J&K Shareholding Pattern of JAL as on December 31, 2004
Financial Performance The audited financial performance of JAL for FY2003, FY2004 and for the half year ended September 30, 2004 is as
The audited financial performance of JCL (prior to amalgamation of Jaiprakash Industries Limited with Jaypee
Cement Limited) for the last two years is as given below:
Closing share price on NSE as on February 4, 2005 was Rs. 196.50 Market Capitalization on the NSE as on February 4, 2005 was Rs. 34,627 million.
ii. Highest and Lowest price of JAL on the BSE in the last six months:
Closing share price on BSE as on February 4, 2005 was Rs. 196.35 Market Capitalization on the BSE as on February 4, 2005 was Rs. 34,600 million.
Promise v Performance
Details of the last issue made by JAL:
The company’s last issue was made in April/May, 1993 with an object to part finance the requirements of funds for setting up Cement Plant III at Rewa (M.P.) with an installed capacity of 1.5 million tons per annum at an estimated cost of Rs. 3,500 million and for setting up the 300 MW Baspa Stage-II Hydro Electric Project at Himachal Pradesh at an estimated cost of Rs. 8,500 million. The said objects were achieved.
(i) The financial year 1995-1996 was changed to comprise of 15 months ended June 30, 1996 (ii) The financial year 1997-1998 was changed to comprise of 9 months ended March 31, 1998 (iii) Cement plant III (one of the object for which issue was made) was hived off to a new wholly owned subsidiary of JIL during the year 1996-97.
The results for the said plant were, therefore, not included in the results of JIL (now JAL) for the year 1996-97 and 1997-98, as projected in the offer document.
Subsidiaries of JAL (A) Jaiprakash Power Ventures Limited (JPVL) JPVL was incorporated on May 18, 1995 and a certificate of commencement of business dated June 12, 1995 has been issued by the RoC, Kanpur.
JPVL was promoted by JIL (now JAL) for the implementation of 400MW Vishnuprayag hydro electric project, in Uttaranchal on build own operate basis. The project cost estimated at Rs. 19,011.20 million is being financed by way of equity of Rs. 5,703.40 million and debt of Rs. 13,307.80 million, which has already been tied up. The civil work is in progress, with expenditure of Rs. 10,104 million having been incurred on the project till December 31,
2004. The project is scheduled to be commissioned by December 2006 and would generate a design energy of 2,060.50 MU. 88% of the power to be generated by the project shall be sold to Uttar Pradesh Power Corporation Limited (UPPCL) under a power purchase agreement already executed and balance 12% power shall also be delivered by the company to UPPCL for supply to Government of Uttaranchal free of cost.
Shareholding Pattern of JPVL as on December 31, 2004
* The above shares are jointly held with JAL and the beneficial interest of the same is with JAL # JAL has brought in an additional Rs. 250 million towards share application money.
Board of Directors of JPVL as on December 31, 2004
(B) Jaypee Hotels Limited (JHL) JHL was incorporated as “Siddharth Inter-Continental Hotels (India) Limited” on December 29, 1980 as a public limited company under the Companies Act and received Certificate of Commencement of Business on February 23, 1981 from the RoC, Delhi, Haryana.
Jaiprakash Enterprises Limited amalgamated with Siddharth Inter-Continental Hotels (India) Limited pursuant to the Scheme of Amalgamation sanctioned by the Delhi High Court vide its Order dated April 5, 1984.
Subsequently, on June 26, 1987, Siddharth Inter-Continental Hotels (India) Limited was renamed as Jaypee Hotels Limited.
JHL carries on the business of hotels, restaurants, wine, beer and spirit merchants and to acquire by purchase or lease land, buildings and hereditaments. Further, to carry on the business of builders, civil, mechanical and electrical contractors. JHL presently operates four 5 - Star deluxe hotels in North India including Hotel Jaypee Siddharth in Delhi and Jaypee Palace Hotel and a Convention Centre at Agra.
Shareholding Pattern of JHL as on December 31, 2004
Closing share price on NSE as on February 4, 2005, 2005 was Rs. 42.65 Market Capitalization on the BSE as on February 4, 2005 was Rs 2,366.65 million.
ii. Highest and Lowest price on the BSE in the last six months:
Closing share price as on February 4, 2005, 2005 was Rs 42.65 Market Capitalization on the BSE as on February 4, 2004 was Rs. 2,366.65 million.
JHL made the issue with the object to finance the cost of constructing, equipping and furnishing of 5-Star deluxe hotel cum Convention Centre at Agra and for capital expenditure and long term working capital requirements (The said
objects were achieved). The projections of sales and profitability were made as follows:
1994 380.00 338.80 (10.84) 145.00 87.70 (39.51) ** 1995 430.00 337.50 (21.51) 160.00 46.90 (70.68) ** ** a. Construction division of the company showed a decline in turnover as the construction industry related to river valley projects passed through an unfavourable phase primarily because of government financial constraints.
Therefore, as the continuation of construction work was proving uneconomical, the board of directors decided to close the construction work which resulted in reduction of construction turnover and its profit.
b. Major renovation work was undertaken in both the hotels which resulted in reduced operating profit.
c. Higher incidence of income tax also reduced net profit after tax.
(C) Jaypee Karcham Hydro Corporation Limited (JKHCL) JKHCL was incorporated on April 29, 2002 as a public limited company under the Companies Act and received Certificate of Commencement of Business on July 4, 2002 from the RoC, Jalandar.
JKHCL is promoted by JAL to develop and operate its 1,000 MW Karcham Wangtoo Hydro Electric Project in Himachal Pradesh under an implementation Agreement executed between the GoHP and JAL. The Techno–Economic clearance has been accorded by CEA at an estimated cost of Rs. 59,100 million. Various statutory and other approvals have been obtained except the environmental clearance. Steps to tie up finances have been taken up. Infrastructure works for implementation of the project are proposed to be undertaken in FY2005. The Project is expected to be commissioned in the year 2010.
Shareholding Pattern of JKHCL as on December 31, 2004
(D) Jaiprakash Hydro-Power Limited (JHPL) JHPL is a 100% subsidiary of JAL and its 180 million equity shares are offered for sale by this Draft Red Herring Prospectus.
Group Companies The companies which can be classified as Promoter Group Companies are Jaiprakash Associates Limited, Jaypee Hotels Limited, Jaiprakash Power Ventures Limited, Jaypee Ventures Limited, Jaypee Karcham Hydro Corporation Limited, Jaiprakash Enterprises Limited, JIL Information Technology Limited, Jaypee Industrial & Medical Services Private Limited, Shiras Estates Limited and Gaur & Nagi Limited (A) Jaypee Ventures Limited (JVL) JVL was incorporated as “International Design Engineering Associates Limited” on May 12, 1992, as a public limited company under the Companies Act, 1956 and received a Certificate of Commencement of Business dated June 11, 1992 from the RoC, Delhi and Haryana. On an application made by the International Design Engineering Associates Limited, it was converted into a private limited company on April 22, 1998 under Section 31(1) of the Companies Act and thus, the name was changed to “International Design Engineering Associates Private Limited”. Subsequently, on February 9, 2000, it became a public limited company. Furthermore, on January 1, 2001, the name of the company was changed to Jaypee Ventures Limited.
JVL has been set up to carry on the business of providing consultancy services including identification of projects, basic and detailed engineering for various projects and industries related to generation of power, to provide technical services in the construction and operation of industrial plants and providing services as in the area of project assignment.
JVL has been assigned “CT 1” grade by ICRA Limited indicating Very Strong Project Engineering Capacity with highest prospects of good technical design services.
Shareholding Pattern of JVL as on December 31, 2004
(B) Jaypee Industrial & Medical Services Limited (JIMS) JIMS was incorporated on August 14, 1986 as a private limited company in accordance with the provisions of the Companies Act, 1956. Subsequently, it was converted into a public limited company on January 5, 2005.
JIMS is a subsidiary of JVL.
JIMS is engaged in the business of providing services of medical and security personnel to other companies. It also has an experience in running and operating a Hydro-Power Plant.
Shareholding Pattern of JIMS as on December 31, 2004
*The above shares are jointly held with JVL and the beneficial interest of the same is with JVL Board of Directors of JIMS as on December 31, 2004
(C) JIL Information Technology Limited (JILIT) JILIT was incorporated as “JIL Information Technology Private Limited” on May 9, 2000. Thereafter, this company became a deemed public company pursuant to section 43A (1) of the Companies Act, with effect from July 31 2000.