KAPSTON FACILITIES MANAGEMENT LIMITED

CORPORATE PRESENTATION

March 16, 2018

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COMPANY OVERVIEW

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COMPANY OVERVIEW

COMPANY NAME KAPSTON FACILITIES MANAGEMENT LIMITED REGISTERED OFFICE MUMBAI, MAHARASHTRA
INDUSTRY SERVICE – SECURITY AND FACILITY SERVICES EXCHANGE NSE EMERGE

• Kapston Facilities Management Limited, is a Hyderabad based, ISO 9001 & OHSAS 18001 certified company,
providing Security and Integrated Facility Management (FM) Services, promoted and managed by Mr. Srikanth
Kodali and Mr Radha Krishna Pinnamaneni having over a decade of experience in said line of business.

• KFML boasts of a branch network consisting of 6 branch offices and 8 training centres across 10 cities in 8 states
having over 6165 billed employees in addition to unbilled employees.

• The Company has now entered into its tenth year of operations and has developed the necessary ‘Skills and
Expertise’ to provide Integrated FM Services which includes Security, Housekeeping, M&E, Pest Control, Facade
cleaning, Office Support and Kennel Services. Company have effectively spanned across the entire southern
region, as of now.

• Tie-up with Government of India & State Governments for skills development, Implementing prestigious Deen
Dayal Upadhyaya Grameen Kaushalya Yojana (DDU – GKY)” project under the Ministry of Rural Development in
Karnataka, Odisha, Assam, Kerala and Maharashtra. Also Partners with the “National Skills Development
Corporation”(NSDC)
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ISSUE HIGHLIGHTS

IPO DETAILS ISSUE OPENS MARCH 21, 2018

Issue Size 23,04,000 Shares ISSUE CLOSES MARCH 23, 2018
Fresh Issue 11,52,000 Shares LISTING ON NSE EMERGE
Offer for Sale 11,52,000 Shares
LEAD MANAGER TO THE ISSUE
Issue Size in Amount Rs. 21,19,68,000
CKP FINANCIAL SERVICES PRIVATE LIMITED
Face Value Rs. 10
Issue Price Rs. 92 REGISTRAR TO THE ISSUE

Pre Issue No of Shares 75,42,909 Shares BIGSHARE SERVICES PRIVATE LIMITED

Post Issue No of Shares 86,94,909 Shares RESERVATION FOR NO OF SHARES
Pre Issue Paid up Capital Rs. 7,54,29,090 MARKET MAKER 1,17,600
Post Issue Paid up Capital Rs. 8,69,49,090
NON INSTITUTIONAL 10,93,200
Post Issue Market Cap Rs. 79,99,31,628
RETAIL PORTION 10,93,200

SHAREHOLDING PATTERN PRE IPO POST IPO BID LOT

Promoter Holding 99.27% 72.87% RII 1200 shares and amount not
exceeding 2,00,0000
Public Holding 0.73% 27.13%
Other than RII Amount exceeding 2,00,000 but in
multiples of 1200
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OBJECTS OF THE ISSUE

TOTAL PROCEEDS FROM THE ISSUE Rs.2,119.68 Lakhs

OBJECTS OF FRESH ISSUE AMOUNT ALLOCATED IN RS. Rs.1,059.89 Lakhs

Part finance working capital requirements Rs. 660.75 Lakhs

Part repayment of unsecured loans Rs. 200 Lakhs
Meet general Corporate Expenses [•]
Meet offer Expenses [•]

OBJECTS OF PROCEEDS FROM OFFER FOR SALE Rs.1,059.89 Lakhs

• To improve Working Capital Cycle, the Promoter plans to infuse Rs.500 Lakhs from
proceeds of issue as ‘Minimum Promoter Contribution’ into National Skills Development
Corporation (NSDC) Programme for obtaining further loan at concessional rate of 6%
payable quarterly.
• Additional loan Rs.2,000 lakhs to be obtained to invest in its future financial requirements
for training manpower.
• The Company already has loan from NSDC and is fulfilling the conditions to qualify for the
Scheme.
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EXPERIENCED BOARD

MR. SRIKANT KODALI MR. RADHA KRISHNA PINNAMANENI

PROMOTER AND MANAGING DIRECTOR PROMOTER & NON EXECUTIVE DIRECTOR
Promoter cum Managing Director 25 Years of entrepreneurial experience
having rich experience over a decade in from founding and building unique
facility management and security enterprise
services
He has experience with R.K Builders,
Strategic manager and decision making
Hanumans Traders, Global Chits and
guiding force
Finance Corporation

MR. CHEREDDI RAMCHANDRA NAIDU MR. NAVEEN NANDIGAM MRS. KANTI KIRAN DODDAPANENI

CHAIRMAN AND INDEPENDENT DIRECTOR INDEPENDENT DIRECTOR DIRECTOR

Holds a degree in Commerce and Chartered Accountant since 1990 he Associated with the Company since
Management studies from Andhra started a community of student DIGVIJAY January 2018 and holds a bachelor’s
University coaching center to provide professional degree in Science from Osmania university
He was a Inspector General in Police and coaching.
retired in 2007. He has expert knowledge He is committed and continuously Responsible for Administration and HR
of human resource management, balances his CA profession as well as related operations of the Company
industrial relations, etc coaching assignments

EXPERIENCED KEY MANAGERIAL PERSONNEL
MR. Brendon Pereira
CHIEF FINANCIAL OFFICER
Post graduate Executive Management
Program from SPJIMR, Mumbai and his
Bachelor of Arts (Political Science and
Commerce) from University of Mumbai
. .
He has 20 years of experience across
planning, operations and P&L delivery in
different organizations like Reliance
Industries Limited, DTSS Private Limited
MR. C. Srinivas
GENERAL MANAGER OPERATIONS
Overall 15 years of experience Facilities in
Management field. His academic
background is B.Com. And was previously
associated with Black Belt Commandos
Security System.
Currently Associated with Kapston since 7
years
MR. M. V. Vishnu Bhopal Rao
CHIEF OPERATING OFFICER
22 years of experience in various fields like
Civil Engineer in the field of Projects
/Property & Facility Management of large
buildings and IT Parks.
His academic back ground is B.E (Civil). And
was previously associated with CBRE South
Asia Pvt. Ltd. Currently associated with
Kapston since last 4 years.
MR. Prasenjit Banerjee
VICE PRESIDENT–KARNATAKA & TAMILNADU
Overall 32 years of experience in various
sectors including the Facilities
Management field. His academic
background is MBA.
. Dr.
Was previously associated with A2Z Infra
Services Ltd. Currently associated with
Kapston since last 3 months.
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MR. K. G. R. J. Satya Prakash
ASSOCIATE DIRECTOR - SALES
22 years’ experience in Facilities
Management in MNC’s. His academic
background is MBA (Finance).
.
Was previously associated with Jones Lang
LaSalle Meghraj Building Operations Pvt
Ltd. & Cushman & Wakefield PMSI Pvt.Ltd.
Currently associated with Kapston since 5
years.
MR. S. V. Raghava Rao
GENERAL MANAGER ACOCUNTS
42 years of experience in Accounts field.
His academic background is M.Com
.
Was previously associated with ICRISAT &
Reddy’s Foundation. Currently
Associated with Kapston since last 5 years
BUSINESS MODEL

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LEADING MARKET POSITION IN DIVERSE SERVICES

SECURITY SERVICES E-SECURITY

• 24 Hours Control Room. • CCTV Surveillance Systems

• All operations staff are provided with an
extensive communication network.
• Regular checks and patrolling by night staff.
• Provision of additional security staff at short
notice, whenever so required.
• Immediate response on short calls
• Independent communication system to all
major units and important clients.
• Our Security Managers are in regular contact
with the clients, to provide assistance to their
Security problems if any.
• Action Plan during Riots & Strikes.
• Biometric / Access control Systems
• EPABX
• Vehicle GPRS / Walkie Talkies
• Electronic safety lockers + Video Door Phones
• Digital Signage/Video Walls
• Guard Tour Systems and Monitoring Systems
• Fire Tour Systems, Metal Detectors
• Central Monitoring Systems

3780+
Trained Security
Employees
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LEADING MARKET POSITION IN DIVERSE SERVICES

FACILITY MANAGEMENT SERVICES (FMS)

FMS

Engineering & Façade Pest Control Canine Landscaping

Office Support Panty
Maintenance Cleaning Services Brigade and Gardening
• Office and safety • Incepted innovation in • Customer Support • Termite Control • Maintenance and • Sanitization • Customized tasks
equipment facade cleaning, • Reception • Mosquito Control Re-stocking • Watch Dogs • Gardening,
maintenance • Capable of extending • Telephone and EPABX • Rat Control • Dog training • Driveway
• layout and design of
• Preventive Maintenance automated facade services • Flies Control • Dog boarding facility • Path
kitchen pantry,
cleaning services • Visitor handling • Roach Control • Immediate response maintenance
(PM)
• Conferences • Bed Bugs Control
• Plumbing and Carpentry • Customized to your on short calls • proper drainage
requirements for total • Back Office Operations • Bird Control • Pedigree Pups for flow,
services • And a host of others
cost effectiveness. • General sale • swimming pool
• Corrective Maintenance
• Highly skilled personnel Disinfestation cleanliness
(CM)
to enable you to enjoy
• Situational
the elegance of your
Maintenance (SIT)
• Predictive Maintenance
beautiful architecture 2380+
(PdM) etc.
Trained FMS
Employees
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INDUSTRY GROWTH, MARKET SHARE & GROWTH DRIVERS

Growth Prospects in Securities services: Security Services:

In large industries (Rs. Bn)
KAPSTON
Security services market:
has grown
Security Market Market CAGR India – Expected to grow from Rs. 570 Bn in
>1.5X
services Size (Rs. Size 2020
(FY17 – 20E) FY17 to Rs. 990 Bn in FY20E, at a CAGR of 20%
Bn) (Rs. Bn) Industry
Security service markets typically growing at
Private Security 570 990 20% Growth 2x-3x of GDP in developing markets
Industry

Growth Prospects in Facilities Management Facility Management Services:

services: In large industries (Rs. Bn) KAPSTON
has grown Facility Management market:
FM Market Market CAGR >2.5X India – Expected to grow from Rs. 100 Bn in
services Size (Rs. Size 2020
(FY15 – 20E)
Industry FY15 to Rs. 252 Bn in FY20E, at a CAGR of 20%
Bn) (Rs. Bn)
Growth Global facilities management industry
FMS Industry 100 252 20% generated $28.90 in revenue in 2016 as per
market research

http://ficci.in/spdocument/20966/FICCI-PwC-Report-on-Private-Security-Industry.pdf Source: Frost & Sullivan Report, July 2017

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SEGMENT GROWTH - SECURITY SERVICES & FACILITY MANAGEMENT SERVICES

Rs. In Lakhs

7,000.00
Security Segment Revenue 4,500.00
Facility Management Segment
1649 4,000.00
Revenue
6,000.00 1041.52
5,990.03
3,500.00
5,000.00
4,922.03 4,949.38 3,000.00 3,124.56
3,073.05
4,000.00 4,237.69 2,500.00

3,000.00 2,000.00
3,218.80 2,071.79
1,500.00
2,000.00 1,497.95
1,000.00
1,000.00 908.22
500.00

0.00 0.00
YEAR 2014 YEAR 2015 YEAR 2016 YEAR 2017 YEAR 2018 YEAR 2014 YEAR 2015 YEAR 2016 YEAR 2017 YEAR 2018
Annualised Annualised*
Actual Revenue Estimated Actual Revenue Estimated

Figures of Year 2018 are annualized based on actuals till December, 2017, both disclosed separately in above chart.

The above financial information is based on the restated financials prepared under Indian GAAP and as outlined in the Draft Prospectus filed with SEBI
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GOVERNMENT PROGRAMS

• Tie-up with Government of India & State Governments for skills development
• Implementing prestigious Deen Dayal Upadhyaya Grameen Kaushalya Yojana (DDU – GKY)” project
• Project under the Ministry of Rural Development in Karnataka, Odisha, Assam, Kerala and Maharashtra.
• Partner with “National Skills Development Corporation”(NSDC)
• Target to train and provide employment to over One Lakh unemployed youth by 2025 in various segment.

Government Grants received

500
450
400
350
300
250
200
150
100
50
0
Year 2015 Year 2016 Year 2017 Year 2018 Actuals till
Dec 2017
Grant Amount Received

The above financial information is based on the restated financials prepared under Indian GAAP and as outlined in the Draft Prospectus filed with SEBI
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GROWTH ROADMAP

an ISO 9001
10th Year
& OHSAS
of
18001: 2007
Operation
certified

Presence 400 plus

Team of 200
in entire esteemed
plus
Southern clients
Professional
region

Tie-up MSME
with State Certified by
Governme PSARA
nt

Existing Presence in India

Member of
All branches are on same CAPSI,
( Corporate office, performance metrics & APSA,
Branch office, parameters IISSM,
Training Centers.) Helps provide career path for FTAPCCI &
aspiring managers CII
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DIVERSIFIED END USER SEGMENTS

Customers

Industries
25%

Corporate 8
43%
1000+
Locations 400+ States
Commercial retails Client spread Clients 10
4%
(South India) Cities in India
Media,Studios
4%
Hospitals
4%
Hotel Industry
4%
Construction Sector
Educational Institute
10% 6%

The above information is as outlined in the Draft Prospectus filed with SEBI
FINANCIAL PERFORMANCE

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PROFIT & LOSS STATEMENT

As at December For the year ended March 31,

Particulars 31, 2017 2017 2016 2015 2014 2013
INCOME
Revenue from Operations 8,073.93 9,063.08 7,027.38 5,735.64 4,127.02 2,794.77
Grants received for Skills Projects 412.67 299.50 468.23 152.72 23.75 5.36
Other Income 1.06 25.03 3.82 2.37 1.31 0.29
Total 8,487.66 9,387.61 7,499.43 5,890.73 4,152.08 2,800.42
EXPENDITURE
Changes in inventories (64.08) (1.47) (11.38) - - -
Employee benefit expenses 6,701.48 7,666.05 5,845.94 4,821.76 3,233.76 2,421.42
Expenses related to Grants for Skills Projects 412.67 299.50 468.23 152.72 - -
Other Expenses 605.76 695.95 665.92 555.91 663.40 225.04
Total 7,655.82 8,660.02 6,968.72 5,530.40 3,897.17 2,646.45
EBIDTA 831.83 727.58 530.71 360.33 254.92 153.97
Finance costs 172.07 146.97 97.40 17.05 8.55 4.59
Depreciation and amortization expense 82.91 114.46 85.20 62.14 31.70 15.60
Total 254.97 261.43 182.60 79.19 40.26 20.19
Net Profit / (Loss) before tax (C) 576.86 466.15 348.11 281.14 214.66 133.78
Tax expense :
(i) Current tax 147.87 175.38 141.76 90.90 44.22 83.81
(ii) Deferred tax 8.82 15.19 9.87 9.25 (62.76) 65.33
Total Tax Expense (E) 139.05 160.19 131.89 81.66 69.37 18.48
Net Profit / (Loss) after tax but before extraordinary items (D-E) 437.81 305.97 216.22 199.49 145.29 115.29
Extraordinary items - - - - - -
Net Profit / (Loss) after tax but after extraordinary items (D-E) 437.81 305.97 216.22 199.49 145.29 115.29
* The above financials are on the basis of the restated financials prepared under Indian GAAPand as outlined in the Red Herring Prospectus filed with SEBI
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BALANCE SHEET STATEMENT
As at March 31,
Particulars As at December, 2017
2017 2016 2015 2014 2013
EQUITY AND LIABILITIES
Shareholders Funds
a. Share Capital 167.62 139.68 55.87 50.00 50.00 1.00
b. Reserves & Surplus 1,313.62 903.75 681.59 418.39 219.42 123.12
TOTAL 1,481.24 1,043.43 737.47 468.39 269.42 124.12
Non Current Liabilities
a. Long Term Borrowings 858.00 661.72 499.25 133.37 145.88 78.39
b. Long Term Provisions 21.58 18.20 13.81 11.75 - -
Current Liabilities
a. Short Term Borrowings 771.92 586.23 289.67 - - -
b. Trade Payables 127.66 93.78 128.64 77.24 56.67 35.53
c. Other Current Liabilities 1,572.00 1,120.87 1,482.37 1,116.85 657.26 547.95
d. Short Term Provisions 6.41 0.22 0.10 0.11 - 15.94
TOTAL 4,838.81 3,524.44 3,151.30 1,807.72 1,129.22 801.93
ASSETS
Non Current Assets
a. Fixed Assets (Net Block)
i. Tangible Assets 1,785.82 1,355.61 413.98 255.73 202.98 119.36
Gross Block 1,785.82 1,355.61 413.98 255.73 202.98 119.36
Less: Depreciation 397.91 315.00 200.54 115.34 52.69 20.98
Net Block 1,387.91 1,040.61 213.43 140.39 150.29 98.38
b. Deferred Tax Asset 45.28 36.46 21.27 11.40 2.16 64.91
Current Assets
a. Inventories 76.93 12.85 11.38 - - -
b. Trade Receivables 2,022.92 1,705.56 1,338.25 1,057.69 826.27 569.11
c. Cash and Cash Equivalents 391.64 386.46 450.27 446.17 37.80 38.82
d. Short Term Loans & Advances 679.52 51.52 861.04 10.75 3.77 8.00
e. Other Current Assets 234.62 290.98 255.65 141.31 108.93 22.71
TOTAL 4,838.81 3,524.44 3,151.30 1,807.72 1,129.22 801.93
* The above financials are on the basis of the restated financials prepared under Indian GAAPand as outlined in the Red Herring Prospectus filed with SEBI
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BUSINESS MODEL WITH CONSISTENTLY HIGH RETURNS

9 Months Dec 17 Year 2017 Rs.in lakhs

Year 2016 Year 2015

Revenue EBIDTA Capital Employed Tangible Assets

8073.93 831.83 1481.24 1387.97

1,043.43 1,040.61
9063.08 727.58

213.43
530.71 737.47
7027.38

140.39
360.33 468.39
5735.64

The above financial information is based on the restated financials prepared under Indian GAAP and as outlined in the Draft Prospectus filed with SEBI
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CONSISTENT GROWTH IN PAT

Strong historic PAT growth

500

450 437.81

400

350
305.97
300

250
216.22
199.49
200
145.29
150
115.29
100

50

0
1
Year 2013 Year 2014 Year 2015 Year 2016 Year 2017 9 Months Deec 17

The above financial information is based on the restated financials prepared under Indian GAAP and as outlined in the Draft Prospectus filed with SEBI
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FINANCIAL RATIOS

Particulars For the Year Ended

December 31, 2017* 2017 2016 2015 2014 2013

Return on Net Worth 29.56% 29.32% 29.32% 42.59% 53.93% 92.89%

EBIDTA Margin 10.30% 8.03% 7.55% 6.28% 6.18% 5.51%

PAT Margin 5.15% 3.26% 2.88% 3.38% 3.50% 4.12%

Restated Basic and Diluted EPS 5.80 4.06 3.18 2.96 2.15 1.71

Net Asset Value Per share 88.37 74.70 131.99 93.68 53.88 1241.22

*Figures are not Annualized. Shares outstanding as on February 2018 is considered while calculating above ratios
(Source:Prospectus)

The above financial information is based on the restated financials prepared under Indian GAAP and as outlined in the Draft Prospectus filed with SEBI
INVESTMENT RATIONALE

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INVESTMENT RATIONALE

• Attractive Valuation:

• 9 Months Dec, 2017 P/E : 15.86

(Industry Peers like Quess Corp Ltd and Security and Intelligence Service Ltd have annualised P/E multiple of 40 plus)

• Superior RNoW March, 2017 : 29.32

(Industry Peers like Quess Corp Ltd and Security and Intelligence Service Ltd have RNoW of 11 plus)

• CAGR (5 YEARS F.Y. 2013 TO F.Y. 2017) - Revenue CAGR 34.19% & PAT CAGR 27.63%

• Wide Range of Services: Company provides Security and Facilities Management Services to various customer segments.
Some major customers include: Dr. Reddy’s Laboratories, HBL Power Systems Ltd, KIMS Hospitals, Salarpuria Sattva, NCC
Ltd, Sakshi, DLF Limited, Wipro Ltd, Divis Laboratories Ltd, Karvy Group etc.
• Experienced Promoter and proficient management team: Mr. Srikanth Kodali and Mr Radha Krishna Pinnamaneni having
over a decade of experience in said line of business. Mr. Chereddi Naidu has expertise knowledge in Human Resource
Management as he was Inspector General of Police. Mr. Brendon Pereira, CFO having 20 years of experience in planning
operations in Reliance Industries Ltd, DTSS Pvt Ltd, etc. Mr. Vishnu Rao, COO, Civil Engineer having experience in Facility
Management of large buildings and IT Parks and other senior employees are from reputed organizations such as CBRE
South Asia, Jones Lang Lasalle Meghraj Building Operations, Cushman & Wakefield PMSI Pvt Ltd, Blackbelt Commando
Systems, Dr. Reddy’s Foundation, A2Z Infra Services Ltd, etc.
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INVESTMENT RATIONALE

• Proposed Business Strategy:

 Increase Presence throughout South India

 Expand the service portfolio and our operations through PAN India acquisitions
 Invest in established technological systems for sustainable business model
 Grow business across customer segments
 Continued partnership with NSDC enabling effective Working Capital Management of Company

• Long standing relationship with customers: Customer loyalty and customer satisfaction are the key strengths for the growth of
Company

• Systematic Network: Aligned business network is a key advantage for the Company.

• Dedicated facilities for training and imparting skills: Background of the Company’s performance is dependent on its staff, hence
rigorous trainings and imparting skills to the employees for increased efficiency is conducted

The above financial information is based on the restated financials prepared under Indian GAAP and as outlined in the Draft Prospectus filed with SEBI
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CONTACT US
CKP FINANCIAL SERVICES PRIVATE LIMITED

CKP House, D’Monte Park, Pali Hill, Bandra West,

Mumbai- 400050, India
Website: www.ckpfinancialservices.com
Contact Person: Mr. Brijesh Parekh
Tel: +91 9322997964/ 022 65014100
Email : brijesh.parekh@ckpfinancialservices.com
info@ckpfinancialservices.com

Ms. Janvi Talajia - Tel: +91 8268623566

Ms. Chhaya Devda - Tel: +91 7021554860

Email : ckpfinserve@gmail.com
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THANK YOU
This presentation and the accompanying slides (the “Presentation”), which have been prepared by Kapston Facilities Management Limited (the
“Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or
subscribe for any securities, and shall not form the basis or be relied on in connection with any contract or binding commitment whatsoever. No
offering of securities of the Company will be made except by means of a statutory offering document containing detailed information about the
Company.

This Presentation has been prepared by the Company based on information and data which the Company considers reliable, but the Company makes
no representation or warranty, express or implied, whatsoever, and no reliance shall be placed on, the truth, accuracy, completeness, fairness and
reasonableness of the contents of this Presentation. This Presentation may not be all inclusive and may not contain all of the information that you
may consider material. Any liability in respect of the contents of, or any omission from, this Presentation is expressly excluded.

This presentation contains certain forward looking statements concerning the Company’s future business prospects and business profitability, which
are subject to a number of risks and uncertainties and the actual results could materially differ from those in such forward looking statements. The
risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings, our
ability to manage growth, competition (both domestic and international), economic growth in India and abroad, ability to attract and retain highly
skilled professionals, time and cost over runs on contracts, our ability to manage our international operations, government policies and actions
regulations, interest and other fiscal costs generally prevailing in the economy. The Company does not undertake to make any announcement in case
any of these forward looking statements become materially incorrect in future or update any forward looking statements made from time to time by
or on behalf ofthe Company.