Highlights of the Concall

Consolidated revenue was up 11% at Rs 201.22 crore compared to Rs 181.34 crore in FY10. Consolidated expenditures including depreciation and amortisation was up 27% at Rs 109.07 crore compared to Rs 85.64 crore in FY10. Consolidated net profit after tax (PAT) was marginally down by 6.5% at Rs 69.02 crore compared to Rs 73.85 crore in FY10.

The above mentioned numbers include the impact of the amalgamation of the Saffron entities effective August 1, 2010, being the effective date of the amalgamation. The impact of the growth in AUM is reflected in the enhanced revenue numbers for the year end. However, the same is not translated into growth in profits primarily due to amortisation of the consideration paid for the amalgamation. The amortisation in the financials for the year end includes an amortisation of Rs 8.80 Crore

Consolidated income has increased by about 11% primarily because of the increase in assets under management through the Saffron merger as well as joint venture funds which have now started yielding better revenue profiles as well as profitability.

Saffron roughly around 23 crore on the top-line in FY'11 and on a net basis after removing the amortization part of it, roughly around 3 crores is added to the bottom-line.

Consolidated expenses have increased 19% mainly due to increase in salaries. For FY'10 the company had a salary growth for current employees of only 5% given the market conditions. However for FY'11 the company has increased salary by 15% in order to take care of not having done it in the previous fiscal. Also with the addition of Saffron, the company had additional employees which increased the salary cost.

The company also had taken a loan to buy saffron merger in international market which has resulted in an interest obligation which was not there earlier. The company did not have any debt earlier.

The company had in last 6 months find it pretty difficult to go out and convince investors to come in at a faster pace mainly due to issues related to corporate governance and other 2G related propaganda in the media.

The company had invested Rs 8.27 billion in FY'11 as against Rs 5.78 billion in FY2010 across 18 fresh and follow-on investments. In aggregate, the company attained fifteen full exits / partial exits across all the three verticals realizing US$221 million. Six of these exits were by way of trade / strategic sale, in part a reflection on the poor primary markets during the second half of the year. The company's portfolio was also able to take advantage of favorable market conditions in the first half with 3 investee companies getting listed during October-November 2010.

IL&FS have launched 4 funds in the market- Tara IV, IL&FS Milestone joint venture for stabilized assets in the market, PIPE fund in the market and the fourth one is Middle Eastern Fund which is just getting into the market. The company expects results from some of these fund raises to start showing up in the second quarter of this fiscal.

The company is expecting to launch in the second and third quarter infrastructure funds- one will be a generic infrastructure fund focused on the Indian markets and another one could be a niche product that it would like to use the Yatra platform to raise on. So through these two the company plans to raise at least another half a billion in terms of revenue generating funds under management in FY'12.

The company is a full tax paying company is India but as far as the foreign subsidiary goes, it is based on the local tax rate of 3%. That is why the effective consolidated tax is around 24-25%.