ADANI PORTS & SEZ
ADSEZ’s FY15 annual report analysis highlights increase in operating
cash flows (adjusted for receivables discounting of INR4.5b) from
INR11.3b in FY14 to INR26.2bin FY15 led by (acquisition of) Dhamra
port and improved operations at other subsidiaries. Free cash flow
post interest was -INR4.5b on rising capex. D/E increased to 1.6x.
Unhedged forex payable was INR84.6b (79% of net worth), which
acts as a natural hedge for forex-denominated revenue. Following
the amended AS11, ADSEZ capitalized forex losses of INR1.4b (6%
of PBT). Auditors have highlighted INR1.4b (2% of PAT) of
MAT recoginition, which is currently subjudice.Exposure to related
parties (RPs) was at INR92b (86% of net worth), primarily
comprising of INR8.5b of receivables, INR24.4b of loans & advances
(L&A) and INR56.9b of guarantees
Operating cash flow improves:
Operating cash flow adjusted
for receivables discounting of INR4.5b increased from INR11.3b
in FY14 to INR26.2b in FY15, led by the acquisition of Dhamra
Port and improved operations at other subsidiaries. Free cash
flow post interest remained negative at INR4.5b (FY14: INR6.1b)
on rising capex at subsidiaries. D/E increased marginally from
1.5x in FY14 to 1.6x in FY15.
L&A to RP at INR24.4b (23% of net worth); ICDs at INR13.3b
(12% of net worth):
Debt increased to INR177b (FY11: INR36b),
primarily to fund the capex. ADZEZ deployed surplus cash to
fund L&A to related parties (at INR24.4b v/s INR0.2b in FY11)
and in ICDs (at INR13.3b v/s INR1.2b in FY11). Further, INR15.1b
of loans extended to RPs were received back during the year.
Receivables from RPs at INR8.5b, 8% of net worth:
Of these,
INR6.3b pertained to Adani Power. Receivables from RPs stood
at 252 days against receivables of 65 days from non-related
parties. Management has highlighted receivable deferment up
to 18 months for Adani Power; this carries interest of 11%.
Guarantees for RPs at INR56.9b (53% of net worth):
which
pertain to Abbot Point, which was hived off to the promoter
group in FY13. ADSEZ has received a deed of indemnity from the
promoter entity against the same.
Unhedged forex payables at INR84.6b (79% of net worth):
Act
as a natural hedge to forex earnings. While the operational side
forex movement flows through the income statement, opting
for the amended AS11 has led to forex losses of INR16.4b being
adjusted in the balance sheet over the last five years.
ART
will present a threadbare portrait of annual reports - statistical, strategic and
structured. We believe
ART's
wide canvas - from accounting and auditing issues to operating
performance to management insights to governance matters - will help readers paint a
clearer picture of the stock's investment worthiness.
The
ART
of annual report analysis
Operating performance
remained strong, with
EBITDA increasing 33% YoY
to INR39b.
Exposure to related parties high at 86% of
net worth.
Unhedged forex payable at INR85b (75% of
net worth).
Stock Info
A
NNUAL
R
EPORT
T
HREADBARE
15 October 2015
Bloomberg
CMP (INR)
Equity Shares (m)
52-Week Range (INR)
1,6,12 Rel. Perf. (%)
M.Cap. (INR b) / (USD b)
ADSEZ IN
325
2,071
375/2444
-6/5/22
673/10.3
Financial summary (INR b)
Y/E March
Sales
EBITDA
NP
EPS (INR)
EPS Growth (%)
BV/Share (INR)
RoE (%)
RoCE (%)
Payout (%)
2013A
35.8
24.6
16.2
7.9
48.5
31.9
28.5
10.9
12.5
2014A
48.3
29.2
17.4
8.2
3.8
42.3
22.8
14.2
12.5
2015A
61.5
39.0
23.1
11.0
33.2
52.0
23.8
14.0
10.0
A: Actual
Shareholding pattern (%)
As on
Promoter
FII
DII
Others
Sep-15
56.3
33.2
5.1
5.5
Note: FII Includes depository receipts
Jun-15
56.3
24.9
12.3
6.5
Mar-15
56.3
32.0
4.7
7.1
Auditor’s name
S R B C & Co LLP
Sandeep Gupta
(S.Gupta@MotilalOswal.com); +91 22 3982 5544
Somil Shah
(Somil.Shah@MotilalOswal.com); +91 22 3312 4975
Investors are advised to refer through disclosures made at the end of the Research Report.
Motilal Oswal research is available on
www.motilaloswal.com/Institutional-Equities,
Bloomberg, Thomson Reuters, Factset and S&P Capital.

ART
|
Adani Port and SEZ
ART #1
ACCOUNTING & KEY FINANCIAL INSIGHTS
Adjusted operating cash flow increases; free cash flow remains negative
Receivables discounting of
INR4.5b supports the
improvement in operating
cash flow
Operating cash flow grew from INR11.3b in FY14 to INR30.7b in FY15. This is
primarily on account of (a) acquisition of Dhamara Port, (b) improved level of
operations at subsidiaries, and (c) discounting of receivables,
ADSEZ commenced receivables discounting in FY15, which partially aided the
improvement in operating cash flow. As at FY15, receivables discounted stood at
INR4.5b. Adjusted for which, operating cash flow improved 131% from INR11.3b
in FY14 to INR26.2b in FY15.
Free cash flow remained negative at INR4.5b (FY14: 6.1b) primarily on account
of high capex primarily at subsidiaries.
Standalone
Consolidated
FY14
FY15
FY14
FY15
22.1
21.5
19.8
25.0
4.1
4.4
6.0
8.3
1.5
0.6
3.4
6.2
(4.9)
(4.3)
(5.2)
(4.9)
22.8
22.2
24.1
34.7
(4.7)
1.0
(6.3)
0.5
(0.6)
(0.4)
(0.7)
(0.7)
(0.1)
(2.0)
(0.1)
(2.4)
0.3
(1.1)
0.3
(1.1)
(0.4)
(0.5)
(2.5)
(0.8)
(3.4)
0.1
(0.3)
(0.0)
0.1
0.1
0.1
0.1
0.8
(0.3)
0.9
(0.6)
(2.4)
0.9
(5.9)
0.9
3.6
(0.0)
1.8
(0.0)
16.0
20.0
11.3
30.7
(4.5)
-
(4.5)
16.0
15.5
11.3
26.2
(4.7)
(6.3)
(6.4)
(12.8)
11.3
9.2
5.0
13.4
(2.7)
(4.6)
(11.0)
(17.8)
8.6
4.6
(6.1)
(4.5)
Source: Company Annual Report, MOSL
Exhibit 1:
Improved performance and receivables discounting drive cash flow (INR b)
Particulars
Net profit before taxation, and EO items
Add/(Less): Non-cash adjustments
Add/(Less): Non-Operating adjustments
Less: Direct Taxes (Paid) / Refund Net
Operating profit before w/cap changes
Trade receivables
Inventories
Other Current Assets
Other Non Current Assets
Short Term Loans And Advances
Long Term Loans And Advances
Provisions
Trade payables
Other Current Liabilities
Long Term Liabilities
Cash generated from operations
Bills discounted
Adjusted cash generated from operations
Less: Financial cost
Cash generated from operations post interest
Less: Capital expenditure
Free cash flows
Exhibit 2:
Earnings to cash conversion remained healthy
Adjusted Pre-Tax CFO/ EBITDA
93%
83%
74%
57%
79%
Reported Pre-Tax CFO/ EBITDA
91%
FY11
FY12
FY13
FY14
FY15
Source: Company Annual Report, MOSL
15 October 2015
2

ART
|
Adani Port and SEZ
Cash conversion cycle deteriorates on rising receivables from RP
Adjusted cash conversion
cycle deteriorates from 0
days in FY11 to 117 days in
FY15, primarily on rising
receivables
Cash conversion cycle on a closing basis deteriorated from 0 days in FY11 to 117
days in FY15, primarily on account of receivable days, which increased from 51
days in FY11 to 102 days in FY15, and payable days, which reduced from 75 days
in FY11 to 59 days in FY15.
The increase in receivable days is primarily on account of related parties.
Receivables from related parties stood at 252 days in FY15.
Exhibit 3:
Cash conversion cycle deteriorates
Particulars
Inventory Days
Receivable Days
Payable Days
Cash conversion cycle days
Bill discounting
Adjusted Cash Conversion Cycle
FY11
24
51
75
0
0
0
FY12
30
53
177
-94
0
-94
FY13
FY14
FY15
32
35
47
82
108
102
58
55
59
56
88
90
0
0
27
56
88
117
Source: Company Annual Report, MOSL
Revenue growth led by subsidiaries
Excluding container
development infrastructure,
consolidated revenue grew
38% to INR61.5b while
EBITDA margin expanded
from 57% in FY14 to 63%
in FY15
Other income at 27% of PBT
includes write backs of
INR0.4b (2% of PAT)
Revenue increased 27% YoY to INR61.5b while EBITDA margin expanded from
60% in FY14 to 63% in FY15.
Financials of FY15 are not comparable with FY14 on account of revenue and cost
recognized towards container terminal infrastructure development (for AICT, a
JV company in FY14) – a new revenue vertical.
On a like-to-like basis, standalone revenue increased 8% from INR36.3b in FY14
to INR39.1b in FY15 while EBITDA margin was maintained at 67%.
Excluding revenue from container development infrastructure, consolidated
revenue grew 38% to INR61.5b while EBITDA margin expanded from 57% in
FY14 to 63% in FY15.
Improvement in consolidated performance was primarily on account of the
newly-acquired Dhamra port and the existing Dahej and Hazira ports.
Auditors have highlighted that ADSEZ has accounted higher MAT credit of
INR1.4b (including INR0.6b for prior years) on a matter that is currently
subjudice. Consequently, PAT for FY15 is higher by 2%.
Other income increased to INR6.9b, 27% of PBT (FY14: INR6.8b, 35% of PBT)
which includes write-back of unclaimed liabilities / excess provision write-back
of INR0.4b, leading to reported PAT being higher by 2%.
15 October 2015
3

ART
|
Adani Port and SEZ
Exhibit 4:
Subsidiary led improvement in operational performance
Standalone
Particulars
Net Revenue (Reported)
Revenue from Container terminal infrastructure
development
Revenue ex Container terminal Infrastructure development
Expenses:
Operating and Administrative Expenses
Personnel Cost
Other expenses
Container Terminal Infrastructure Development cost
EBITDA
EBITDA (ex- container terminal infrastructure development)
Depreciation
EBIT
Financial Charges
EBT
Other Income
PBT
Tax
PAT – Reported
MAT Adjustment
PAT Adjusted
43.5
7.2
36.3
8.6
1.2
2.2
4.2
27.4
24.3
4.6
22.8
7.5
15.3
6.8
22.1
1.9
20.2
0.6
19.6
FY14
(INR b)
FY15
FY14
Consolidated
FY15
(% of
(% of
(% of
(% of
(INR b)
(INR b)
(INR b)
revenue)
revenue)
revenue)
revenue)
100
39.1
100
48.3
100
61.5
100
17
83
20
3
5
10
63
67
10
52
17
35
16
51
4
46
1
45
-
39.1
8.9
1.6
2.6
-
26.1
26.1
4.9
21.2
7.1
14.1
7.4
21.5
(0.3)
21.8
1.4
20.5
-
100
23
4
7
-
67
67
12
54
18
36
19
55
(1)
56
4
52
3.6
44.7
12.8
1.6
2.6
2.1
29.2
27.7
6.5
22.7
9.8
12.9
6.8
19.8
2.4
17.4
0.6
16.8
8
92
-
61.5
-
100
26
16.6
27
3
2.4
4
5
3.6
6
4
-
-
60
39.0
63
57
39.0
63
13
9.1
15
47
29.9
49
20
11.8
19
27
18.2
30
14
6.9
11
41
25.0
41
5
1.8
3
36
23.2
38
1
1.4
2
35
21.9
36
Source: MOSL, Company
Exhibit 5:
Improvement in subsidiaries’ performance led by newly acquired Dhamra Port (INR b)
FY14
FY15
Particulars
Turnover
PAT
Turnover
PAT
The Dhamra Port Company
Adani Logistics
Adani Hazira Port
Adani Petronet (Dahej) Port
MPSEZ Utilities
Others
Total
-
5.4
2.7
3.0
0.9
0.6
12
0.0
0.3
-0.2
0.1
0.0
-0.2
0.02
7.2
1.0
6.3
0.5
4.9
0.7
4.8
0.9
1.2
0.1
1.0
-0.7
25
2
Source: Company, MOSL
Exhibit 6:
Other income high due to unclaimed liabilities/ provisions written back (INR b)
Other Income
% of PBT
35%
27%
15%
4%
1.1
FY11
0.5
FY12
2.6
FY13
6.8
FY14
6.9
FY15
Other income contributed
significantly to PBT in FY14
and FY15 due to one-offs
11%
Source: Company Annual Report, MOSL
15 October 2015
4

ART
|
Adani Port and SEZ
Debt remained the primary source to fund capex
Debt increased by INR141.1b—from INR36.2b in FY11 (38% of sources of fund)
to INR177.3b in FY15 (55% of Sources of fund)—due to fresh borrowings and
MTM losses on foreign currency loans. D/E increased from 0.9x in FY11 to 1.6x
in FY15.
Fixed assets (including goodwill) increased from INR81.1b in FY11 to INR218b in
FY15, primarily due to organic capex and acquisition of Dhamra Port in FY15.
Loans and advances increased by INR55.9b—from INR6.5b (7% of application of
funds) in FY11 to INR62.3b (19% of application of funds) in FY15. The increase is
primarily in FY13 and FY14, wherein the company received proceeds from sale
of Abbot Point, QIP and advances of INR6.3b for development of container
infrastructure at CT3. The management intends to reduce these loans and
advances over the next 18-24 months.
Receivables increased by INR14.5b—from INR2.8b (3% of application of funds)
in FY11 to INR17.3b (5% of application of funds) in FY15.
Exhibit 8:
… increased to 55% in FY15 to fund capex
Others, 8%
Provisions,
2%
FY15: Sources of funds
Receivables and loans & advances also up
Exhibit 7:
Debt contributed 38% to sources of funds in FY11…
FY11: Sources of funds
Others,
16%
Provisions,
1%
Net Worth,
44%
Net Worth,
34%
Borrowings,
38%
Payables,
1%
100% = INR95b
Borrowings,
55%
Payables,
1%
100% = INR321b
Source: Company Annual Report, MOSL
Source: Company Annual Report, MOSL
Exhibit 9:
L&A increased from 7% of application of funds in FY11…
Loans &
Trade
FY11: Application of funds
Advances, Receivables
Others, 2%
7%
, 3%
Cash &Inv,
3%
Exhibit 10:
… to 19% in FY15
Goodwill,
8% Others, 5%
Trade
Receivables
, 5%
FY15: Application of funds
FA & CWIP,
85%
Loans &
Advances,
19%
100% = INR95b
Source: Company Annual Report, MOSL
Cash &Inv,
3%
FA & CWIP,
60%
100% = INR321b
Source: Company Annual Report, MOSL
Net exposure to related parties at 86% of net worth
ADSEZ’s receivables from related parties stood at INR35.1b, 33% of net worth
(FY14: INR35.9b, 41% of net worth), primarily comprising of loans and advances
of INR24.4b and receivables of INR8.5b.
Further, guarantees extended for related parties stood at INR56.9b, 53% of net
worth.
5
15 October 2015

ART
|
Adani Port and SEZ
Exhibit 11:
Net exposure to related parties remain high (INR b)
Particulars
Trade Receivable
Loans & Advances
Capital Advances
Other Current Assets
Other Current Liabilities
Trade Payable
Advances from Customer
Net Receivables (A)
As a % of net worth
Corporate Guarantee
Total Others (B)
As a % of net worth
Net Exposure (A+B)
As a % of net worth
FY14
7.8
22.5
2.5
3.4
0.0
0.1
0.2
35.9
41%
50.8
50.8
58%
FY15
8.5
24.4
0.0
2.8
0.1
0.1
0.3
35.1
33%
56.9
56.9
53%
87
92
99%
86%
Source: Company Annual Report, MOSL
Loans and advances to related parties remain high
Loans and advances given to related parties stood at INR24.4b, 23% of net
worth (FY14: INR22.5b, 26% of net worth).
ICD’s extended to third parties have declined from INR17.1b in FY14 to INR13.3b
in FY15.
Further loans of INR15.1b (including 12.5b to Adani Enterprise) extended to
related parties during the year were received back during the same year.
Exhibit 13:
ICD’s continue to remain at elevated levels
ICD (INR b)
19%
ICD as % of Net Worth
20%
12%
Exhibit 12:
Loans & advance to related parties increase
Loans to related parties (INR b)
26%
% of Net Worth
23%
6%
0%
0.2
FY11
1%
0.4
FY12
3.8
FY13
22.5
FY14
24.4
FY15
3%
1.2
FY11
2%
1.1
FY12
12.1
FY13
17.1
FY14
13.3
FY15
Source: Company, MOSL
Source: Company, MOSL
Exhibit 14:
Loans extended and repaid during the same year (INR b)
Particulars
Adani Agri Fresh Ltd.
Adani Enterprises Ltd.
Adani International Container Terminal
Pvt. Ltd.
Adani Power Ltd.
Dholera Infrastructure Pvt. Ltd.
Chemoil Adani Pvt. Ltd.
Adani Infra (India) Ltd.
Mundra Port Pty Ltd., Australia
Total
Loans Given
FY14
FY15
14.5
3.1
0.0
12.5
-
4.5
0
1.9
6.4
-
27.4
0.4
-
0
-
2.8
-
18.8
oans Received Back
FY14
FY15
5.5
1.5
-
12.5
Net
FY14
FY15
9
2
-
-
-
-
-
0
5.1
-
(1)
-
-
-
0
0
-
1.9
2
(2)
-
1.0
6
2
0.7
-
(1)
-
11.2
17.0
16.2
1.9
Source: Company Annual Report, MOSL
6
15 October 2015

ART
|
Adani Port and SEZ
Receivable days of related parties 4x receivable days of non-related parties
Receivables from related parties stood at INR8.5b, 8% of net worth (FY14:
INR7.8b, 9% of net worth). Receivable days of related parties stood at 252 days
v/s 65 days for non-related parties.
Of the receivables, INR6.3b (FY14: INR5.7b) are due from Adani Power.
Receivable days from Adani Power stood at 435 days.
Management has highlighted that the receivables from Adani Power have been
extended till a period of 18 months and carry an interest of 11%.
Exhibit 15:
Receivable days of related parties 4x receivable days of non-related
parties (INR b)
Particulars
Total Receivables
Receivables from Related party
Receivables excluding related parties
Revenue
Revenue from related parties
Revenue excluding related parties
Receivable days of related parties
Receivable days excluding related parties
Receivable days
FY14
14.3
7.8
6.5
FY15
17.3
8.5
8.8
Receivable days of related
parties at 252 days
48.3
61.5
9.5
12.3
38.8
49.2
301
252
61
65
108
102
Source: Company Annual Report, MOSL
Exhibit 16:
Receivable days of Adani Power more than one year (INR b)
Particulars
Adani Enterprises Ltd.
Adani Foundation
Adani Global F.Z.E.
Adani Infra (India) Ltd.
Adani International Container Terminal Pvt. Ltd.
Adani Mining Pvt. Ltd.
Adani Power Dahej Ltd.
Adani Power Ltd.
Adani Power Maharashtra Ltd.
Adani Power Rajasthan Ltd.
Adani Wilmar Ltd.
Chemoil Adani Pvt. Ltd.
Total
Receivables Sales
Receivable Days
0.5
3.5
49
0.0
0.0
25
-
-
NA
0.0
-
NA
0.3
0.7
162
-
-
NA
0.2
-
NA
6.3
5.3
435
0.3
1.0
101
0.8
1.0
293
0.0
0.4
45
0.0
0.3
7
8.5
12.3
252
Source: Company Annual Report, MOSL
Exhibit 17:
Rise in debtors outstanding for more than six months (INR b)
Debtors outstanding more
than six months stood at
INR5.2b (30% of total
receivables)
8%
0.2
FY11
1.0
FY12
Receivable more than 6m
25%
% of total receivable
30%
23%
10%
0.8
FY13
3.4
FY14
5.2
FY15
Source: Company Annual Report, MOSL
15 October 2015
7

ART
|
Adani Port and SEZ
Contingent liabilities at 65% of net worth due to corporate guarantees
In FY15, contingent liabilities rose to INR69.9b (FY14: INR57.6b) on the back of
(a) corporate guarantees given on behalf of subsidiaries & others, and (b) bills
discounting with banks of INR4.5b.
ADSEZ has provided guarantee of USD800m for credit facility availed by
erstwhile subsidiary, Mundra Port Pty Limited, Australia for the acquisition of
Adani Abbot Point Port, which was subsequently sold to promoter group entity
in FY13.
As at the end of FY15, INR30.5b (USD487m) of loans stood outstanding against
the said guarantee.
ADSEZ has collected an indemnity from promoter group entity for the
outstanding guarantee.
FY11
FY12
FY13
FY14
FY15
Exhibit 18:
Contingent liabilities high on the back of corporate guarantees given (INR b)
Particulars
Contingent liabilities remain
high due to corporate
guarantees given for
acquisition of Abbot Point
Port, which was
subsequently sold to
promoter group entity
Corporate Guarantees on behalf of
subsidiaries and others
Bank Guarantees given to government
authorities and banks
show cause notices from Custom & Excise
Disputed tax demand (MAT)
Future outstanding export obligation
Notice received from Superintendent /
Commissioner of Service Tax
Bills Discounted with Banks
Others
Total
% of Net Worth
-
0.8
0.7
-
-
0.4
-
0.7
2.5
6%
-
1.0
0.7
-
-
45.6
1.5
0.7
-
-
50.8
2.0
1.0
0.5
2.1
56.8
1.5
1.1
1.4
3.5
0.5
0.4
0.5
0.6
-
-
-
4.5
0.8
2.6
0.7
0.5
2.9
50.8
57.6
69.9
6%
79%
66%
65%
Source: Company Annual Report, MOSL
24% of income generated from related parties
ADSEZ generated 24% (FY14: 29%) of its total income from related parties,
mainly from port services.
FY14
9.5
3.6
2.4
0.2
15.7
55.1
29%
FY15
12.3
-
3.9
0.1
16.3
68.4
24%
Exhibit 19:
Significant portion of income generated from related parties (INR b)
Particulars
Income from Port Services /other operating income
Income from development of Container
Interest Income on deposits/deferred accounts receivable
Others
Total
Total Income
% of Total Income
Deferred Infrastructure Usage Charges (Amortized over a period
of Agreement)
Upfront Infrastructure Development Fees
Purchase of Spares and consumables, power and fuel
Others
Total
Expense
% of Expense
Related parties contributed
to 24% of income
1.9
-
0.8
-
2.3
1.2
0.1
0.4
5.1
1.6
29
34
18%
5%
Source: Company Annual Report, MOSL
Un-hedged forex payables act as natural hedge for forex earnings…
ADSEZ’s net forex exposure as at the end of FY15 stood at INR84.6b (79% of net
worth), primarily on account of outstanding foreign currency loans.
We believe this is kept un-hedged, as it acts as a natural hedge against forex-
denominated earnings.
8
15 October 2015

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Adani Port and SEZ
Exhibit 20:
Un-hedged forex exposure remains high (INR b)
Particulars
Foreign currency loan
Buyer's Credit
Trade Payables
Other Current Liabilities
Interest accrued but not due
Total (A)
Less: Other Receivable
Net Un-hedged Payables
FY11
9.2
8.4
0.6
-
0.0
18.2
0.0
18.2
FY12
FY13
FY14
FY15
48.2
68.5
81.9
79.2
6.7
5.6
7.6
5.7
0.5
0.3
0.1
0.2
-
-
-
0.02
0.3
0.3
0.5
0.5
55.8
74.8
90.2
85.7
0.0
13.3
0.9
1.1
55.8
61.4
89.2
84.6
Source: Company Annual Report, MOSL
Unhedged forex payables at
79% of net worth
…however, capitalizing forex losses creates timing mismatch
Forex loss capitalized for
FY15 at INR1.4b (6% of PBT)
ADSEZ has adopted the amended AS11; in FY15, it capitalized forex losses on
long-term monetary items: (a) INR1.3b to carrying cost of fixed assets (to be
depreciated over the life of asset), and (b) INR0.2b accumulated in FCMITDA
account (to be amortized over the period of loan or FY20, whichever is earlier).
Cumulatively, over the last five years, INR14.4b of forex losses have been
capitalized in fixed assets while INR2b have been charged to FCMITDA account.
FY11
-
0.4
0.4
10.0
4%
FY12
0.2
1.9
2.1
12.0
18%
FY13
FY14
FY15 Cumulative
Exhibit 21:
Foreign losses adjusted via balance sheet (INR b)
Particulars
Forex gains/ (losses):
Recognised in FCMITDA
Capitalised in cost of fixed assets
Total
PBT
% of PBT
0.4
1.2
0.2
2.0
3.6
7.3
1.3
14.4
3.9
8.5
1.4
16.4
16.8
19.8
25.0
23%
43%
6%
Source: Company Annual Report, MOSL
15 October 2015
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Adani Port and SEZ
ART #2
MANAGEMENT SPEAK / KEY PLANS
ADSEZ operates seven ports / terminals spread over four maritime states of
India – Gujarat, Goa, Andhra Pradesh, and Odisha. It operates 14 terminals
having 37 berths to handle dry, liquid and container cargo, and two single-point
mooring facilities.
ADSEZ also provides other services, including infrastructure, leasing and logistics
services at the Mundra Port through its surrounding infrastructure, including the
Mundra SEZ, which the company has developed and operates. Mundra SEZ is
one of the largest operating port-based multi-product special economic zones in
India.
New ports
ADSEZ has implemented significant expansion plans and is currently
implementing certain other expansion projects. It is developing a container
handing terminal at Ennore Port, Tamil Nadu. According to the concession
agreement, the first phase is to be completed by January 2017. However,
considering the progress of construction, the first phase would be completed
and operational by March 2016.
Special economic zone
ADSEZ has focused on the development of robust infrastructure to support
industrial development within the Mundra special economic zone (SEZ). This
SEZ, one of the largest port-based multi-product SEZs in India, has almost all
infrastructure facilities – multimodal connectivity (rail/road/sea/air), utilities
(power generation, distribution network, water supply, sewage & effluent
treatment facilities, etc), warehousing/storage/logistics facilities, port facilities
for handling all types of cargo, and social infrastructure (housing, hospital,
school, etc) required for setting up businesses.
As at March 31, 2015, a total of 25 entities have obtained approval for setting
up units in the SEZ. Some of them have already started operations and export
activities. Some are under construction. These units have already invested over
INR17.3b
.
Other group developments
Adani Murmugao Port Terminal Private Limited and Adani Vizag Coal Terminal
Private Limited commenced commercial operations during the year.
15 October 2015
10

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Adani Port and SEZ
ART #3
GOVERNANCE MATTERS
Auditor rotation likely as per Companies Act 2013
Member firms of Ernst & Young (S R Batliboi & Associates and S R B C & Co LLP)
have been the auditors of ADSEZ since FY05-06.
The Companies Act (2013) requires mandatory rotation of auditors for listed
entities after serving for 10 consecutive years. The Act further provides a three-
year period (from April 1, 2014) to comply with this requirement.
Thus, statutory auditors will be mandatorily changed post FY17.
Statutory auditors to be
mandatorily changed post
FY17, in accordance with
the new Companies Act
Directors regular in attending board meetings
ADSEZ is regular in calling board meetings as per the prescribed laws. Six board
meetings were held in FY15.
All directors attendend more than 50% of the meetings in FY15, except Mr
Sanjay Lalbhai and Mr AK Rakesh.
Exhibit 22:
Most directors regular in attending board meetings
Name of Director
Mr. Gautam S. Adani
Mr. Rajesh S. Adani
Dr. Malay Mahadevia
Mr. Sudipta Bhattacharya
Mr. Arun Duggal
Mr. D. T. Joseph
Prof. G. Raghuram
Mr. G. K. Pillai
Mr. Sanjay Lalbhai
Mr. A. K. Rakesh, IAS
Ms. Radhika Haribhakti
Held
6
6
6
6
6
6
6
6
6
6
-
Attended
6
4
5
6
5
6
5
4
3
1
Attendance AGM
Yes
Yes
No
Yes
Yes
Yes
Yes
Yes
No
No
-
-
Source: Company Annual Report, MOSL
Managerial remuneration
ADSEZ paid a managerial remuneration of INR206.4m, 0.8% of PBT (FY14:
89.3m, 0.5% of PBT).
Exhibit 23:
Managerial remuneration paid (INR m)
Name of Director
Mr. Gautam S. Adani
Mr. Rajeeva Ranjan Sinha
Mr. Sudipta Bhattacharya
Dr. Malay Mahadevia
Others
Total
As a % of PBT
FY14
FY15
28
28
20.7
2.8
0
68
34.4
103.9
6.18
6.48
89.3
209.2
0.5%
0.8%
Source: Company Annual Report, MOSL
15 October 2015
11

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Adani Port and SEZ
NOTES
15 October 2015
12

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ADANI PORTS
No
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