PROJECT REPORT

ON

PROJECT FINANCE

Submitted in partial fulfillment of the requirement of post graduate diploma In Management All India Council for Technical Education (AICTE)

Submitted by NEHA MAHINDRU ROLL NO. (67)

JAGANNATH INTERNATIONAL MANAGEMENT SCHOOL MOR, POCKET 105, KALKAJI NEW DELHI- 110019

CONTENTS
PAGE NO.

Acknowledgement Preface Executive Summary Abstract I. INTRODUCTION-COMPANYs PROFILE

NTPC LTD OVERVIEW VISION MISSION CORE VALUES CORPORATE OBJECTIVES

MAJOR HIGHLIGHTS 2007-08 OPERARTIONAL EXCELLENCE ROBUST FINANCIALS GREEN POWER CSR INITIATIVES WINNING ACCOLADES CAPITAL OUTLAY SUBSIDAIRIES HUMAN RESOURCE CONSULTANCY INSTALLED CAPACITY TARIFFS

II. ORGANIZATION STRUCTURE

PICTORAL REPRESENTATION DIMENSIONS OF FINANCE DEPARTMENT WORKING OF FINANCE DEPARTMENT

III. INTERNATIONAL FINANCING FROM NTPC LTD PERSPECTIVE

OBJECTIVE OF THE PROJECT WORKING OF THE INTERNATIONAL FINANCING DEPT. WHAT IS INTERNATIONAL FINANCING GLOBALIZATION OF INTERNATIONAL FINANCE MARKETS

APPROACHES TO REGULATION FOREIGN EXCAHNGE MARKET STRUCTURE OF INDIAN FOREIGN MARKET MECHANISM OF INTER-BANK TRADING FINANCING A POWER PROJECT SOURCES OF DEBT LIMITATIONS OF DEBT BORROWINGS

IV. WHY INTERNATIONAL FINANCING

COMPONENTS OF INTERNATIONAL FINANCING WHY CREDIT RATING SOURCES OF FINANCE UPTO 31-03-07 REGULATION FRAMEWORK IN INDIA FOR RAISING ECBs RAISING DEBT FROM INTERNATIONAL FINANCE

V. CASE STUDY NTPC LTD ENERGY EFFICIENCY

PROGRAMME-KfW
RENOVATION AND MODERNISATION(R&M) OBJECTIVE OF R&M CATEGORIES OF R&M STRATEGIES OF NTPC PROCEDURAL ASPECTS OF NEGOTIATING A FOREIGN CURRENCY LOAN INTRODUCTION OF KfW. TERM SHEET APPROVAL OF BOD PROCESSING WORKING SCHEDULE KfW PROPOSAL QUESTIONNAIRE ENVIRONMENTAL GUIDELINES DEFINAITIONS & INTERPRETATIONS

VI. GROWTH PLANS

-

GROWTH PLANS OF NTPC LTD

FINDINGS
SELECTED FINANCIAL STATEMENTS

LEARNINGS

RECOMMENDATIONS AND CONCLUSION GLOSSARY BIBLIOGARPHY

ACKNOWLEDGEMENT
I express my sincerest gratitude and thanks to Honble Mr. K. Shreekant (DGM) and Mr. Sunil Gupta (Dy. General Manager- Finance) for their kindness , I had the precious opportunity of attaining training at NTPC LTD. Under their brilliant untiring guidance I could complete the project being undertaken on the topic INTERNATIONAL FINANCE FROM NTPCS LTD PERSPECTIVE successfully in time. There meticulous attention and

invaluable suggestions have helped me in simplifying the problem involved in the work . I would also like to thank the overwhelming support of the people who gave me the opportunity to learn and gain knowledge about the various aspects of the industry. I would like to thank Ms. Abha Grover for her constant enthusiastic encouragement and valuable suggestions without which the project would not have been successfully completed.

NEHA MAHINDRU

PREFACE
International finance studies the dynamics of exchange rates, foreign investment, and how these affect international trade. It also studies the international projects, international investments and the international capital flows. International financing is required because Fund availability subject to sectoral ceilings and existing exposures are also to be kept in mind. Foreign investors have started viewing India favorably. Investors are now willing to lend / invest in good Indian corporates. To meet the cost of imports. A lender can market and transfer funds to a borrower in another country, or the borrower can seek and attain funds from the lender in the lenders country. To become a truly global company serving global markets, NTPC has established its brand equity in overseas markets. Its scale of operation, financial strength and large experience serve to provide an advantage over competitors. To meet the objective of making available reliable and quality power at competitive prices, NTPC would continue to speedily implement projects and introduce stateof-art technologies. Generally, it involves the study of international financial transactions, transactions that have some cross-border element with respect to payment, credit or investment, or a financial contract.

EXECUTIVE SUMMARY
To become a truly global company serving global markets, it is essential for NTPC to establish its brand equity in overseas markets. Developing and operating world-class power stations is NTPCs LTD core competence. Its scale of operation, financial strength and large experience serve to provide an advantage over competitors. To meet the objective of making available reliable and quality power at competitive prices, NTPC would continue to speedily implement projects and introduce state-of-art technologies. To learn general management practices followed at NTPC LTD in International Financing, and to get the international exposure of the industry working abroad To learn the functioning of Finance Department and funding requirements in power sector. To understand the process of liasioning with government organization . Under International financing, there is an INFLOW and an OUTFLOW of funds. Inflow consists of Financing i.e Foreign loans and Direct borrowings through External Commercial Borrowings. Initially the finance was made through Government of India (GOI) before Liberalization . After 1991, all PSUs arranged their own finances and now Direct loan is made through World bank etc. Outflow is done by payment of loans. Two dimensions to International financing are Loan agreements ( negotiations ) where to park funds and Contract awarding through materials department. In short, international finance is very broad. It may effectively include any transaction or issue that involves more than one country.

The foreign exchange market in india consists of three segments or tiers . The first consists of transactions between Reserve Bank of India (RBI) and Authorised dealers (ADs) . The second segment is the inter-bank market in which the Ads deal wth each other and the third segment consists of the transactions between Ads and their corporate customers , the retail market , the currency notes and the travellers cheques cater to the tourists .

ABSRACT
The Project report is divided into -:

I. INTRODUCTION- COMPANYs PROFILE II. III. IV. ORGANIZATION STRUCTURE INTERNATIONAL FINANCING FROM NTPC LTD PERSPECTIVE WHY INTERNATIONAL FINANCING PROGRAMME-KfW VI.
VII.

V. CASE STUDY NTPC LTD ENERGY EFFICIENCY

GROWTH PLANS FINDINGS

VIII. LEARNINGS
IX. X. XI.

RECOMMENDATIONS AND CONCLUSION GLOSSARY BIBLIOGARPHY

Objective of the project

To become a truly global company serving global markets, it is essential for NTPC to establish its brand equity in overseas markets. Developing and operating world-class power stations is NTPCs core competence. Its scale of operation, financial strength and large experience serve to provide an advantage over competitors. To meet the objective of making available reliable and quality power at competitive prices, NTPC would continue to speedily implement projects and introduce state-of-art technologies.

To learn general management practices followed at NTPC LTD in International Financing, and to get the international exposure of the industry working abroad

To learn the functioning of Finance Department and funding requirements in power sector.

To understand the process of liasioning with government organization

CHAPTER 1 INTRODUCTION

NTPC LTD : An Overview

 VISION
A world class integrated power major, powering Indias growth, with increasing global presence".

CORE VALUES (BCOMIT)

Business Ethics Customer Focus Organizational & professional Pride Mutual Respect and Trust Innovation and Speed Total Quality for Excellence

Mission

 Develop and provide reliable power, related products and services at competitive prices, integrating multiple energy sources with innovative and eco friendly technologies and contribute to society"

CORPORATE OBJECTIVES

Make available reliable and quality power in increasingly large quantities at competitive prices and ensure timely realization of revenues. Adopt a broad based capacity portfolio including hydro power, LNG, nuclear power, and non-conventional and eco-friendly fuels. Plan and speedily implement power projects using state-of-the-art technologies. Be an integrated utility by implementing strategic diversifications in areas such as power trading, distribution, transmission, coal mining, coal

beneficiation etc. Develop a strong portfolio of profitable businesses in overseas markets including technical services, generation assets etc.

 Continuously attract and develop competent and committed human resources to match world standards. Lead fundamental and applied research for adoption of state-of-the-art technologies, breakthrough efficiency improvements and new fuels. Lead developmental efforts in the Indian power sector including assisting state utility reform, policy advocacy etc. Be a socially responsible entity with thrust on environment protection, ash utilization, community development, and energy conservation.

NTPC Limited, a premier Public Sector Enterprise of Navratna status, established in 1975 is the largest power utility with an installed capacity of 28,644 MW through 26 power stations including 4 stations operated under joint venture companies. NTPC has emerged as an integrated Power Major with presence in Hydro Power, Coal mining, Oil & Gas exploration, Power Distribution & Trading and also to enter into Nuclear Power Development. NTPC contributed 29.25% of the total electricity generated in the country during 2006-07 with 20.71% share of total installed capacity of the nation including capacity and generation of joint venture companies .NTPC Limited is the largest power generating company of India. A public sector company, it was incorporated in the year 1975 to accelerate power development in the country as a wholly owned company of the Government of India. At present, Government of India holds 89.5% of the total equity shares of the company and the balance 10.5% is held by FIIs, Domestic Banks, Public and

others for shareholding pattern. Within a span of 32 years, NTPC has emerged as a truly national power company, with power generating facilities in all the major regions of the country. NTPC's core business is engineering, construction and operation of power generating plants. It also provides consultancy in the area of power plant constructions and power generation to companies in India and abroad NTPC has changed its name to NTPC LIMITED , as it is extending its operations in areas of Hydro Power, Coal Mining, Oil & Exploration , Power distribution & Trading and Nuclear Power Development.

It is providing power at the cheapest average tariff in the country.

With its experience and expertise in the power sector, NTPC is extending consultancy services to various organizations in the power business. NTPC is committed to the environment, generating power at minimal environmental cost and preserving the ecology in the vicinity of the plants. NTPC has undertaken massive afforestation in the vicinity of its plants. Plantations have increased forest area and reduced barren land.

A "Centre for Power Efficiency and Environment Protection (CENPEEP)" has been established in NTPC with the assistance of United States Agency for International Development. (USAID). As a responsible corporate citizen, NTPC is making constant efforts to improve the socio-economic status of the people affected by the its projects. Through it's Rehabilitation and Resettlement programmes, the company endeavors to improve the overall socio-economic status of Project Affected Persons. NTPC was among the first Public Sector Enterprises to enter into a Memorandum of Understanding (MOU) with the Government in 1987-88. NTPC has been Placed under the 'Excellent category' (the best

category)

every

year

since

the

MOU

system

became

operative.

MAJOR HIGHLIGHTS 2007-08

OPERATIONAL EXCELLENCE : Coal based stations recorded the highest ever Plant Load Factor (PLF) of 92.24% as compared to 89.43 % previous year. Ten coal based stations achieved more than 90 % PLF Highest ever generation of 200.86 Billion Units (BUs) - an increase of 6.46 % over the previous year. Contributed 28.51 % of the total electricity generated in the country during the current year with 19.11 % share of the total installed capacity of the nation.

ROBUST FINANCIALS
Market Capitalisation of the company is over Rs 1621 billion (US $ 40.33 billion approximately) making it the third largest company as on 31.3.2008.Tied a loan of USD 380 million (approximately Rs. 15272 million ) with international banks under Japan Bank of Cooperation (JBIC) guarantee to part finance the 1980 MW Barh Super Thermal Power Project (Stage I) in Bihar state Signed a loan Agreement of Euro 68.563 million (equivalent to USD 100 million or

4361 million) with the Nordic Investment Bank (NIB) on February 15, 2008, a multilateral financial institution owned by the Nordic and Baltic countries, to part finance the capitaL expenditure. Signed a loan Agreement of Rs. 10000 million with Life Insurance Corporation of India On December 26, 2007 to finance Capital Expenditure of our power generation projects, Coal Mining business, Renovation and Modernization activity and LNG business New loans aggregating to Rs. 34750 million were tied up with domestic Banks and other Financial institutions.

GREEN POWER
NTPC created a green wealth of more than 18.37 million trees till March 2008 During 2007-08, about 23.7 million tonnes of ash utilized as compared to 20.7 million tonnes for productive purposes.

CSR INITIATIVES
Total of 424 physically challenged persons are on the rolls of NTPC and the Company has ensured barrier free access along with strong cultural and

psychological support. NTPC Foundation providing loans/training/medical treatment to physically

challenged persons and economically weaker sections. Signed an MOU with Delhi University to set up an Information and Communication Technology Training Centre for the physically challenged persons

Ten Distributed Generation (DG) projects commissioned till date. Six more projects under various stages of implementation

WINNING ACCOLADES
The largest company in the world in the Forbes List of Worlds 2000 Largest Companies for the year 2007: jumps up by 83 positions from the 494th rank in 2006. No 1 Independent Power Producer Company in Asia, 2007 - Platts Top 250 Global Energy Company 2007 Survey. National Awards for Meritorious Performance during 2006-07, conferred by Ministry of Power on four NTPC stations. Vishvakarma Rashtriya Puraskar, 2006 awarded by Ministry of Labour to 12 employees for innovation and productivity. 'Seventh Great Place to Work for in India 2006'by Grow Talent and Business World survey.

Capital Outlay
The approved outlay for 2008-09 for capital schemes of NTPC is Rs. 135880 million

Equity
NTPC stocks continued to attract investors at the stock markets. The stocks closed at Rs. 196.60 at the end of the year as against the opening price of Rs. 150.25. The Market Capitalization of the company at the close of 2007-08 is Rs. 1621 billion (US $ 40.33 billion) and the company is amongst the top three companies in terms of market

capitalization. The company also declared an all time high interim dividend @ 27% of paidup capital resulting into a dividend payout of Rs. 22262.8 million.

BORROWINGS
Loans
NTPC tied up a loan of USD 380 million (approximately Rs.15272 million ) with international banks under Japan Bank of Cooperation (JBIC) guarantee to part finance the 1980 MW (3 X 660 MW) Barh Super Thermal Power Project (Stage I) in Bihar state. The Loan agreement was signed on 20th December 2007. NTPC signed a loan Agreement of Euro 68.563 million (equivalent to USD 100 million or Rs.4361 million ) with the Nordic Investment Bank (NIB) on February 15, 2008, a multilateral financial institution owned by the Nordic and Baltic countries, to part finance the capital expenditure of its projects. During 2007-08, an amount of USD 10 million (approximately Rs 402 million) was drawn from this loan. NTPC signed a loan Agreement of Rs. 10000 million with Life Insurance Corporation of India on December 26, 2007 to finance Capital Expenditure of our power generation projects, Coal Mining business, Renovation and Modernization activity and LNG business. NTPC has tied up loans from Domestic banks and Financial Institutions aggregating Rs 218093 million as on 31st March, 2008 for its capacity addition programs. During the year 2007-08, new loans aggregating to Rs. 34750 million were tied up excluding the loan extended by LIC. During 2007-08, an amount of Rs 18500 million was drawn from domestic banks.

SUBSIDIARIES
NTPC Vidyut Vyapar Nigam Ltd. (NVVN) NTPC Electric Supply Company Ltd. (NESCL) NTPC Hydro Ltd NTPC LTD.

Vaishali Power Generating Company Limited Bhartiya Rail Bijlee Company Limited
A Joint Venture Company (Subsidiary of NTPC) under the name of Bhartiya Rail Bijlee Company Limited
.

NTPC FOUNDATION
NTPC foundation has been established by the company under Indian Trust Act, 1882 for addressing the niche domains of social development at national level through strategic interventions at National Level. NTPC Foundation provides loans/training/medical treatment to physically challenged persons and economically weaker sections in a phased manner.

HUMAN RESOURCE MANAGEMENT

NTPC has a pool of capable and committed manpower, which is its core strength, the key factor behind all its success and achievements. The total strength of employees of the

Corporation stands at 23,716 as on 31.03.2008 as against 23,633 for the year 200607(excluding employees in JVs & Subsidiaries). All efforts were made to improve the manpower utilization. The overall Man : MW ratio for the year is 0.87.

TRAINING & DEVELOPMENT

The Power Management Institute (PMI), NTPCs apex Training and Development Centre conducted 324 training program with a participants base of 8520. The training man days clocked was 54,254 an all-time high, 2.06% higher than the previous years figure of 53,160. The National Seminar on Power Project Management organized in March, 2008 was attended by 75 participants from power utilities of India. A total 11 [Eleven] programs were conducted under DRUM project which were attended by103 participants from various SEBs.

EMPLOYEE RELATIONS
Industrial Relations in NTPC continued to be cordial and harmonious during the year. Workshops for employee representatives from projects were held, at the apex as well as regional level, to sensitize them of the opportunities, threats and challenges facing the company in the dynamics of an uncertain business environment

CONSULTANCY

The Consultancy Wing of NTPC, with an ISO 9001:2000 accreditation, undertakes all the Consultancy and turnkey project contracts for Domestic and International clients in the different phases of Power plants viz. construction supervision, Project management, FQA, Inspection services, O&M, RLA/R&M of various power utilities. With the string of achievements behind it, NTPC has emerged as the acknowledged leader in engineering, construction, O&M, RLA/R&M and management of power projects. NTPC is registered as a consultant with several leading international development and financial institutions such as The World Bank, The Asian Development Bank, the African Development Bank, and UNDP. NTPC's vast pool of technically qualified and managerial manpower is well supported by excellent infrastructure and knowledge management facilities to deliver the client time bound, qualitative and cost effective solution meeting the global standards. At NTPC, we offer consultancy services related to infrastructure sector business such as: Fossil fuel based thermal power plants Combined cycle power plants Cogeneration plants Water supply and treatment Environment engineering and management

INSTALLED CAPACITY
AN OVERVIEW
Projects NTPC OWNED COAL GAS/LIQ. FUEL TOTAL OWNED BY JVCs Coal Gas/LIQ. FUEL GRAND TOTAL 3 1 26 under 564* 1,480** 29,394 JVs with SAIL 15 07 22 23,395 3,955 27,350 No. of Projects Commissioned (MW) Capacity

* Captive Power Plant ** Power Plant under JV with GAIL, FIs & MSEB

TARIFFS
As a navratna , the government of India has given a very high level of autonomy to the issuer , which includes delegating investment decisions to the board . The Central Electricity Regulatory Commission (CERC) , finalises the tariff for all of the issuers plants.

Different tariffs apply to each of the issuers plants . The tariffs rates consists of the fixed charges based on plant availability , variable charges based on the fuel costs and the unscheduled interchange charge which is a payment or penalty. Since April 1 , 2004 , the tariffs are determined pursuant to the CERCs act which is applicable for fiscal 2005 to fiscal 2009.The significant elements of the fixed charges under the regulations are Return on equity at 14% on the post tax basis based on the prescribed 70:30 debt to equity ratio for the new projects . Actual interest cost incurred on debt Interest on working capital determined on the normative basis. Depreciation on plant & machinery calculated at 3.6% for coal based stations and 6% for gas based stations Operations and maintenance costs (O &M ) determined normatively by the CERC based on the size of unit on per megawatt basis. Variable charges on the electricity sold are determined on the basis of land cost of fuel applied on the quantity of the fuel consumption derived on the basis of the norms for heat rate, specific consumption etc . Other elements of the tariffs are Incentives payable at the rate of Rs 0.25 per unit of operating plants at PLF of more than 80%. Exchange rates variations as per regulations Taxes related to the income arising from the generation activities of the company are recoverable from the customers

CHAPTER 2 ORGANIZATION STRUCTURE

INTERNATIONAL FINANCING

TAXATION

BUDGET
DIMENSIONS OF FINANCE

ACCOUNTS
ESTABLISHMENT & INVESTMENT

TREASURY & BONDS

WORKING OF VARIOUS DEPARTMENTS---

ESTABLISHMENT & INVESTMENT SECTION

It deals with HR

payments like salary, medical , contingent and entertainment payments like Official guest entertainment , leave encashment, administrative payments etc whereas investment sections deals with making Fixed deposits and monitoring them so that it does not affect day to day operations.

TREASURY & BONDS -

It deals with making payments ( transfer of funds

from corporates to projects),directed by the budget department for E-payment of tax. Bonds deal with public issue and private placement. Investor services include to provide the services to the investors like paying dividend, settling queries, quarterly visits , monitoring the companies progress.

PROVIDENT FUND SECTION

individuals, returns etc.

maintaining

provident

funds

of

all

TAXATION-

Deals with filing of returns of all the departments ,foreign currency

payments , clarification of service tax and coordinating the Tax audit.

FINANCE COMMERCIAL

Deals with Tariff ,giving tariff applications for

every project, arranging working capital limit, finalizing letter of credit limit , making Budget for Operations & maintenance etc.

BUDGET SECTION-

It deals with construction activities only. For making

budget for any project a series of steps are taken into account such as feasibility report is prepared for every project, once the location and the cost of the project is finalized . The Budget is prepared to indicate the performance of any utility or unit over a period of time in terms of Physical as well as financial activity. Budget is prepared for the following Objectives To introduce and operate responsibility accounting for line managers. To bring about effective co-ordination of all activities of the organization and effectively meet the project requirement. To effectively manage the project in order to avoid any cost and time overrun. To inculcate the culture of planning and target setting at grass-root level To provide basis of Plan allocation and Budgetary Support by GOI. Budgets are called the Performance Budgets . the Budgets are reviewed from different sets and examined in accordance with targets .

CHAPTER 3 INTERNATIONAL FINANCING FROM NTPCS LTD PERSPECTIVE

Working of Department

International

Finance

Under International financing, there is an INFLOW and an OUTFLOW of funds.

Inflow consists of Financing i.e Foreign loans and Direct borrowings through External Commercial Borrowings . Initially the finance was made through Government of India (GOI) before Liberalization . It was the highest loan taking company before liberalization. After 1991, all PSUs arranged their own finances and now Direct loan is made through World bank etc. Outflow is done by payment of loans. Inflows are made through ROADSHOWS which consists of delegation of Ministry, Technical experts, Engineers etc. which means that it is done through Top level which includes CMD, Director finance and many more. Data reporting is done at the operational level with the support of Personal Relations department .

Two dimensions to International financing are

Loan agreements ( negotiations ) where to park funds. Contract awarding through materials department which includes bidding made by

the contracter. supported by the negotiations consisting of charges , deadlines , targets etc..and the people at the international financing departments makes the payment for them in accordance with the regulations pertaining each contracter.

Different stages of payments are

Advance payment with guarantee. Suppose 10% of the total amount. Mobilisation advance for the setting up of the assignment. Progressive payments which includes -Dispatches 55% -Receipt 20% -Completion 10% -Run ( testing) 5% Dispatches are made through three modes Telegraphic Letter of credit Reimbursement of loans Telegraphic dispatch means payment through bank by letter in the requested currency. Whereas in the Letter of Credit, there is a supplier ( contracter), a bank and a purchaser( NTPC LTD ).Supplier were incurred during the contract. Bank preferred by the purchaser, would see the limit of letter of credit set up by the purchaser which includes instructions mentioned , insurance charges etc. would mention all the charges to the bank which

Then, the bank would approach the purchaser , once the letter of credit has been seen, the payment would be made if there are no differences and if there are any differences that would be reconciled . Bank transfers the money in the account of the supplier and deduct the letter of credit limit. Basis of letter of credit would depend upon period of loan , amount etc.. Reimbursement of loans are done only for the international banks .

Accounting Procedures are handled through SAP. Suppose in case of contract

awarding . project is debited and bank is credited. And at the end the Reconciliation process is done to bridge the gaps between the payments

WHAT

IS

INTERNATIONAL

FINANCING??
For economists, international finance has traditionally meant the study of exchange rates but for policy makers and lawyers it means much more. Generally, it involves the study of international financial transactions, transactions that have some cross-border element with respect to payment, credit or investment, or a financial contract . The cross-border aspect of finance can arise from the fact that the activity of the provider

and the user of funds may be located in two different countries. A lender can market and transfer funds to a borrower in another country, or the borrower can seek and attain funds from the lender in the lenders country. Similarly, an issuer of securities can market and distribute securities to investors in another country, or foreign investors can make investments by coming to the issuers country, as when a foreign investor buys U.S. equity on a U.S. stock exchange. Generally, concern with other countries domestic policies is mainly a matter of mutual concern for the most developed countries, the countries with the most tightly linked economies. Nonetheless, we have seen an expansion of international concern in recent years to the domestic economies and financial systems of almost all countries. There are a variety of reasons for this expanded concernpolitical (a stagnating country may ferment radicals), foreign aid consequences (a stagnating country may require more foreign aid) or debt subsidies (a stagnating country may borrow more from the developed countries and the International Monetary Fund). In short, international finance is very broad. It may effectively include any transaction or issue that involves more than one country.

Globalization of Financial Markets

There are difficulties in defining and measuring the globalization of financial markets. There appear to be four main approaches. First, one can look at the correlation of prices between markets. The higher the correlations in rates of returns on similar assets across

countries, arguably the more integrated the markets. One might also look to integration across asset classes internationally as compared to domestically. A second approach looks at quantity. For example, one can look at portfolio diversification. The evidence here is that investors overweight domestic securities in their portfolios. This so-called home bias effect is prevalent to various degrees in all local markets. A third approach looks at the links between savings and investment levels within countries. It has been showed that there is a very tight link between domestic savings and domestic investment levels. However, as investors diversify internationally, these domestic links should relax but recent studies have shown that these domestic links continue to be strong. A fourth approach looks at formal barriers to trade in financial assets. Sources of Law and Regulation Law and regulation in the field of international finance is mainly the purview of national governments, but multilateral institutions are becoming more important over time.

A. National Governments
National governments are the principal regulators of international financial transactions and the formulators of international policies. Every country has an international dimension to its domestic economic regulation. A variety of different regulators within a single country may be involved in regulating

foreign transactions or institutions. Moreover, the regulators of banks, insurance companies, and securities firms or issuers of securities, may be different. This poses a major problem for countries seeking to coordinate policies with each other.

B. Multilateral Institutions
(1) IMF and World Bank
For international finance, the IMF and the World Bank, established in 1944, are quite important. The IMF, which is effectively controlled by developed countries, with the United States as primus inter pares, was set up to help member countries maintain agreed exchange rates. However, with the abandonment of fixed rates in 1972, its mission has shifted to dealing with the financial problems of developing countries and the promulgation of international standards.

(2) Intergovernmental Groups, the G8.

There are also a number of important inter-governmental groups that formulate policies that lay the foundation for internationally coordinated law and regulation. The most important of these is the G8, which is composed of the major democratic industrial countriesCanada, France, Germany, Italy, Japan, Russia, the United Kingdom and the United States. The G8 holds annual economic summits at the head of state level and preparatory meetings at the finance minister level. These summits formulate important policies, such as debt forgiveness for heavily indebted poor countries at the meeting in

2005, which get translated into action through international institutions or sovereign initiatives.

(3) Functional Regulators

Increasingly important for international finance are functional international regulatory bodies that operate at more technical levels than the G8. The most important of these are the Banking Supervision Committee (the Basel Committee) of the Bank for International Settlements, the International Organization of Securities Commissions (IOSCO), the International Association of Insurance Supervisors (IAIS) and the International Accounting Standards Board (IASB). The Basel Committee is the most influential of the international functional regulators as a result of its formulation of the Basel capital adequacy standards.

(4) Coordination Among Functional Regulators

The work of the functional regulators of course overlaps, as financial institutions increasingly offer all financial products (so-called universal banks). In addition, there are important overlaps between the functional regulators and the IMF and World Bank.

(5) Trade Associations

It is also important to mention the numerous trade associations that formulate industry contractual standards for various financial transactions, like the Bond Market Association (BMA) and the International Swaps and Derivatives Association (ISDA).

(6) Bilateral arrangements

There are a variety of bilateral understandings between countries, particularly in the area of enforcement. For example, the SEC has entered into over 20 bilateral enforcement Memoranda of Understanding (MOUs) that permit the SEC and its country counterparty to obtain information necessary to investigate and prosecute enforcement matters. Each MOU is tailored to fit the particular legal frameworks of the two parties to the agreements. Another important development in bilateral arrangements is the establishment of Regulatory Dialogues between particular countries that deal with areas of regulation of mutual concern.

Approaches to Regulation
A major problem in international financial transactions is which countries rules should apply to a transaction. In the securities regulation context the issue is which rules apply when an issuer in one country (the home country) sells securities to investors in another country (the host country).

There are several basic approaches one can take to securities regulation. 1. one could harmonize all securities regulation, so that the same rules applied in all markets. 2. one could allow issuers of securities to choose which regulatory regime they would prefer.

3. one could always apply host country rules, so-called national treatment. 4. one could approach. 5. as between two countries, Country A would apply Country Bs rules if Country B would apply Country As, so-called mutual recognition. 6. the host country would apply its own rules unless the homecountrys rules were equivalent to those of the host country. 7. the host country would apply the home countrys rules but the issuer would have to explain how its home country rules differed from those of the host country. always apply the home countrys rules, so called home-country

FOREIGN EXCHANGE MARKET

The foreign exchange (currency or forex or FX) market exists wherever one currency is traded for another. It is the largest financial market in the world, and includes trading between large banks, central banks, currency speculators, multinational corporations, governments, and other financial markets and institutions. The foreign exchange market is unique because of its trading volumes, the extreme liquidity of the market, the large number of, and variety of, traders in the market, its geographical dispersion, its long trading hours: 24 hours a day except on weekends

the variety of factors that affect exchange rates.

The main trading centers are in London, New York, Tokyo, Hong Kong and Singapore, but banks throughout the Rank world participate. There is little or no 'inside information' in the foreign exchange markets. Exchange 1 2 Currency United States dollar Euro Japanese yen Swiss franc Australian dollar Canadian dollar Swedish krona Hong Kong dollar Norwegian krone code (Symbol) USD ($) EUR () JPY () CHF (Fr) AUD ($) CAD ($) SEK (kr) HKD ($) NOK (kr)

rate 3 4 fluctuations are usually caused by actual monetary flows 5 as well as by expectations of changes in monetary flows 6 7 caused by changes in GDP growth, inflation, interest 8 rates, budget and trade deficits or surpluses, large cross- 9 10 border M&A deals and other macroeconomic conditions. Supply and demand for any given currency, and thus its

British pound sterling GBP ()

value, are not influenced by any single element, but rather by several. These elements generally fall into three categories: economic factors, political conditions and market psychology.

Structure of indian foreign exchange market

The foreign exchange market in india consists of three segments or tiers . The first consists of transactions between Reserve Bank of India (RBI) and Authorised dealers (ADs) .The latter are mostly commercial banks. The second segment is the inter-bank market in which the Ads deal wth each other and the third segment consists of the transactions between Ads and their corporate customers , the retail market , the currency notes and the travellers cheques cater to the tourists .

THE MECHANICS OF INTER-BANK TRADING

The London Interbank Offered Rate is a daily reference rate based on the interest rates at which banks offer to lend unsecured funds to other banks in the London wholesale money market (or interbank market). LIBOR will be slightly higher than the London Interbank Bid Rate (LIBID), the rate at which banks are prepared to accept deposits. LIBOR is published by the British Bankers' Association (BBA) after 11:00 am (and generally around 11:45 am) each day, London time, and is a filtered average of inter-bank deposit rates offered by designated contributor banks, for maturities ranging from overnight to one year. There are 16 such contributor banks and the reported interest is the mean of the 8 middle values. The shorter rates, i.e., up to 6 months, are usually quite

reliable and tend to precisely reflect market conditions. The actual rate at which banks will lend to one another will, however, continue to vary throughout the day. LIBOR is often used as a rate of reference for Pound Sterling and other currencies, including US dollar, Euro, Japanese Yen, Swiss Franc, Canadian dollar, Australian Dollar, Swedish Krona, Danish Krone and New Zealand dollar. BBA LIBOR is the most widely used "benchmark" or reference rate for short term interest rates. It is compiled by the BBA in conjunction with Reuters and released to the market shortly after 11.00am London time each day. BBA LIBOR is compiled each London Business day by Reuters and distributed live via a number of data vendors including Reuters, Thomson Financial, Bloomberg, Quick, Infotec, Class Editori, IDC, Proquote and Telekurs. Many websites operated by financial services and media outlets are licensed to display BBA LIBOR data at the end of the day (that is, after 5pm London Time). Additionally, the financial press, including the Wall Street Journal and Financial Times publish BBA LIBOR data from the previous day. BBA LIBOR is important because: it is long established it offers the largest range of international rates it is a truly international reference rate it has a wide commercial use it enjoys wide international dissemination

its mechanism is transparent it provides a robust settlement rate the banks represented on the panels are the most active in the cash markets and

have the highest credit ratings BBA LIBOR is extremely market sensitive and affected by a number of factors such as liquidity in the London cash markets, constitution of the contributor panels and local interest rate policy. The BBA therefore is not able to provide any forecasts for the future. Long-term BBA LIBOR BBA LIBOR is a shortterm interest rate deposit rate and is only calculated up to a maturity of 12 months. We have never calculated BBA LIBOR rates beyond this nor do we have any intention of doing so as the liquidity in the London interbank cash market dries up after a one year maturity. Some people use interest rates swap rates as approximation for longer periods but please be aware that the methodology is likely to be quite different for BBA LIBOR. These abbreviations stand for the maturities for which BBA LIBOR is fixed. There are 15 different maturities for each currency and day of fixing. The shortest maturity is overnight (O/N) for Euro, US Dollar, Pound Sterling, and Canadian Dollar and spot/next (s/n) for all other currencies. 1 w stands for 1 week and 1m stands for 1 month. The longest maturity for which BBA LIBOR is fixed is 12 months. An "overnight" rate that you see quoted today will value today and mature tomorrow.

A "spot / next" rate that you see quoted today will value in 2 days (i.e. the day after tomorrow) and mature the day after that. BBA LIBOR rates are dependent on a number of factors, including local interest rates, banks expectations of future rate movements, the profile of contributor banks (contributor panels are changed annually), liquidity in the London markets in the currency concerned etc.
May-08 1-May EUR s/n-o/n 1w 2w 1m 2m 3m 4m 5m 6m 7m 8m 9m 10m 11m 12m USD s/n-o/n 1w 2w 2-May 4.08250 4.26563 4.30000 4.38625 4.68438 4.85625 4.86438 4.87250 4.88313 4.89000 4.90125 4.91250 4.92438 4.93938 4.95250 5-May 4.08000 4.27000 4.30375 4.38563 4.68000 4.85750 4.86438 4.87000 4.88000 4.89000 4.90000 4.91438 4.92688 4.94250 4.95688 6-May 4.07750 4.26250 4.30188 4.38625 4.68000 4.85563 4.86688 4.87313 4.88188 4.89063 4.90375 4.91563 4.92813 4.94375 4.95750 7-May 4.06125 4.25188 4.29938 4.38313 4.67875 4.85375 4.86125 4.87000 4.87813 4.88813 4.90375 4.91563 4.92875 4.94438 4.95688 8-May 4.03125 4.23375 4.29500 4.38438 4.67813 4.85313 4.86125 4.86938 4.87750 4.88750 4.89875 4.91375 4.92750 4.94063 4.95625

4.26625 4.30500 4.38813 4.68375 4.85375 4.86500 4.87500 4.88500 4.89375 4.90438 4.91688 4.93063 4.94313 4.95875

2.46000 2.60750 2.66375

2.47250 2.60500 2.65125

2.36500 2.58500 2.63000

2.21125 2.53375 2.58375

2.14500 2.47250 2.52125

FINANCING A POWER PROJECT

Issues related to financing of power projects are

A) Optimal financing mix (Debt Equity Ratio) B.) Debt

o Domestic Market o International Market C) Instruments of Debt

D) Managing Exchange risk variations E) Equity o Fresh Equity from Market

o

Internal Resources

FINANCING MIX
Power projects traditionally had DE ratio of 1:1 Private power policy announced in 1991 permitted project funding with maximum D/E of 80:20. CERC Tariff Regulation 2004 stipulates a maximum Debt Equity Ratio of 70:30 NTPC switched over to Debt Equity ratio 70:30 from earlier 50:50- VSTPP-II in 1995. CERC tariff regulation effectively reduces generation of internal resources which could be used as equity, therefore more reliance on debt than equity at present.

Optimal debt equity ratio depends on Debt Servicing capability of the organisation / project co. Depth of loan market and ability to tap.

Exposure norms Cost of borrowed capital compared to cost of Equity Internal resources generation & requirement Key to capacity addition Dividend Policy

SOURCES OF DEBT: AVAILABILITY&CONSTRAINTS

SOURCE SELECTION-CRITERIA
Selection of instrument of borrowings will depend upon availability, Regulation, cost of funds and maturities needed Maturities to match with cash flows Long term loans with moratorium period of four years or more will be preferred. Risk Mitigation Exchange Rate Risk Interest Rate Risk

RATE OF INTEREST
Factors effecting interest rate decision The rate of interest on any debt instrument is determined by demand and supply mechanism. The market is indifferent to the option of interest rate i.e. floating or fixed since there are a large number of players for both these options. The fixed rate quotes are available on Reuters screen etc. for different

maturities of the loan with respect to LIBOR which set once in a day at 1100 hours in London. Any lending decision is based on two factors

(a) Credit risk Specific to a corporate and depends on debt rating, capital structure, etc. (b) Liquidity risk Higher the tenure higher will be liquidity risk..

MARKET

SCENARIO

OF

DOMESTIC

DEBT

PRESENT EXPOSURE NORMS OF ALL INDIA FINANCIAL INSTITUTIONS (AIFIs) & BANKS Exposure to a particular borrower are presently fixed at 15% of the lenders

Capital Funds. For companies in infrastructure sector, limit is 20% of lenders Capital Funds.

Maximum exposure to a single borrower can be enhanced by 5%-exceptional

circumstances-Board Approval Group is 50% of the lenders Capital Funds incl. Infrastructure Tightening liquidity conditions domestically due to CRR hikes by RBI. Domestic borrowing costs have risen sharply due to successive interest hikes.

RESULTS : Indian borrowers are increasingly accessing the overseas debt markets

as the cost of borrowing is cheaper. Indian borrowers are attracted to JPY denominated loans/bonds .

DEBT - POSSIBLE SOURCES IN DOMESTIC MARKET

Indian Capital Market (Direct Market Borrowing) issue of bonds/debentures Private Placement: which are subscribed by Provident Fund, Pension Fund, Gratuity Fund, Insurance Cos, Regional Rural Banks, Foreign Banks, Corporate, Non-profitable institutions, Mutual Funds and Commercial Banks Public Issues

Term Loans from the Banks & FIs Term Loans from LIC, GIC The Loan could be

Secured Unsecured

LIMITATIONS OF DOMESTIC BORROWINGS

Exposure norms limit the market- reduced availability of funds despite being preferred borrower Banks which have large quantity of funds at their disposal can not generally meet the tenor requirement of the power projects (in regulatory context)

CHAPTER 4 WHY INTERNATIONAL FINANCING?

Fund availability subject to sectoral ceilings and existing exposures are also to be kept in mind.

Issue of creating security @ 1.25 times of the loan amount is also there. Availability of cheap funds in International Markets-6m- Libor for USD 5.43 % p.a., for JPY 6m- Libor is 1.10% p.a.

Foreign investors have started viewing India favorably. Investors are now willing to lend / invest in good Indian Corporates. To meet the cost of import

COMPONENTS FINANCING

OF

INTERNATIONAL

Loan agreement ( NEGOTIATION) Debt servicing Returns.

A loan agreement is a contract entered into between which regulates the terms of a loan. Loan agreements usually relate to loans of cash, but market specific contracts are also used to regulate securities lending. Loan agreements are usually in written form, but there is no legal reason why a loan agreement cannot be a purely oral contract .

Loan agreements are usually characterised either of two different ways: by the type of lender, or by the type of facility. Categorising loan agreements by lender usually simply sub-divides loans into: Bilateral loans

Syndicated loans

Categorising loan agreements by type of facility, usually results in two primary categories: term loans, which are repaid in set instalments over the term, or revolving loans (or overdrafts) where up to a maximum amount can be withdrawn at

any time, and interest is paid from month to month on the drawn amount. The power industry is at the a threshold of major growth cycle along the complete value chain in view of the fact that the GDP is expected to grow at over 8% per annum .The government is taking several initiatives to give thrust to the growth and reform of the sector and also make electricity reach the rural areas and the poor people .

MAJOR INITIATIVES HAVE BEEN TAKEN SUCH AS FORMULATION OF NATIONAL ELECTRICITY POLICY IN FEB 2005 FORMULATION OF NATIONAL TARIFF POLICY IN JANUARY 2006 CERCs POLICY FOR SETTING UP POWER EXCHANGE

KEY ISSUES FACING THE INDIAN POWER SECTOR ARE INADEQUATE POWER GENERATION CAPACITY (1,32,329 MW as on 31.03.2007) LACK OF OPTIMAL UTILISATION OF EXISTING GENERATION CAPACITY

INADEQUATE INTER-REGIONAL TRANSMISSION LINKS LARGE SCALE THEFT AND SKEWED TARIFF STRUCTIRE SLOW PACE OF RURAL ELECTRIFICATION.

CREDIT RATING
Why Rating
Each investor can not go into the details of management, accounts, prospects & risk factors A holistic view generally acceptable amongst lenders; Legal/customary requirement in certain cases- Domestic Bonds/USPP; Makes credit distinction- to some extent Provides comfort to the lenders

Domestic Credit Rating Agencies The credit rating information services of India ltd. (CRISIL) Investor credit rating agency (ICRA) CARE Fitch International Credit Rating Agencies Standard & Poors (S&P) Moodys Investor Service Ltd. (Moodys) Fitch Ratings

RATING CRITERIA
Sovereign risk Political climate Credit worthiness of country Govt. Policies

Industry Risk Demand supply Regulatory restriction

Organisation risk Long term planning and Strategic direction Quality of senior management Market share & competitive position Operating position Financial requirement Capital expenditure management Employee relation Liquidity concerns

Rating Definitions
AAA strong AA A BBB Very Strong Still Strong Exhibit adequate protection parameters. Highest Rating Capacity to meet financial obligation extremely

BB/B CCC/C D

Speculative Speculative Payment Default, filing of bankruptcy petition

Plus(+) or Minus(-) sign is added to show relative standing with in the major rating categories.

REQUIREMENT OF CREDIT RATING

Mandatory for:
US Yankee bonds US 144a offerings Sec- registered bonds

Optional for:
Euro bonds Samurai bonds Dragon bonds US private placements Syndicated loans

SOURCES OF FINANCE UPTO 31/03/07

Sources of Funds Amount INR/MLN

1.

- Equity Share Capital-GOI - Loan from GOI - Grant-in-Aid

78126 36730 33

2. 3. 4. 5. 6.

Bonds issued in domestic market Loans from domestic financial Inst. Foreign Loans Private Equity Internal Resources & Share Premium Total Investment

69806 146001 145579 4329 188305 668909

Italian MULTILATERAL AND BILATERAL FUNDING IN Japan French 1% NTPC UK 24% 3% Saudi 1% West German 9% Russian 9% 2%

World Bank 51%

Regulatory Framework raising ECBs

in

India

for

ECB GUIDELINES- RBI-AUTOMATIC ROUTE

ECBs can be raised by either Automatic Route or under the Approval Route

Eligible

Borrowers-

Corporates

can

borrow

under

this

route.

Financial

intermediaries are exempt such as banks, FII, housing finance companies. Recognized Lenders International Banks, International capital markets, Multilateral financial

institutions such as IFC, ADB, IBRD etc., Export Credits etc. Suppliers of equipment, foreign collaborators, foreign equity bidders Amount & Maturity ECBs upto USD 20 million with avg. Maturity of 3 years for Foreign Currency

Expenditure ECBs above USD 20 million and upto USD 500 Million with avg. Maturity of 5

years for Foreign Currency Expenditure

End Use (Foreign Currency only)

For import of capital goods, new projects For infrastructure sector-power, telecommunications, roads, railways, ports,

industrial parks, urban infrastructure For Investment in JVs and WOS Not permitted for on-lending or investment in capital market by corporates Not permitted for real estate except integrated township

ECB GUIDELINES-RBI-AUTOMATIC ROUTE Parking of Funds abroad-allowed till actual use of funds in India. Prepayment-permitted upto USD 400 mn Refinancing- permitted provided outstanding maturity is maintained and the cost

of raising fresh loan is lower Guarantee- guarantee or letter of comfort from by banks , FIIs etc not permitted

RAISING DEBT FROM INTERNATIONAL MARKET

SOURCES
Syndicated Loans Export Credit from France , Sweden , Korea etc Bonds i.e Eurobonds and MTN Multilateral and Bilateral funds like from KfW Development Banks-through GOI like JBIC and IBRD.

SYNDICATED LOANS
A syndicated loan deal generally consists of : An arranger or lead manager, generally one (or more) banks chosen by

the borrower Members of the syndicate or consortium The remaining syndicate, or consortium, of banks generally simply provide

funds for the loan. A syndicate, or consortium, of banks act as a single financier, based on a single loan agreement. connected with the loan. . In case of disputes, all banks must concur with the majority vote The participating banks split and allocate the risks

EXPORT CREDIT
Financing for goods originating from the respective countries and in some cases,

for local/third country goods Usually upto 85% of the value of goods imported, individual agencies have

different limits Funds are usually provided by a commercial bank which gets guarantee for

political and/or commercial risk from the export credit guarantee agency Sometimes ECA also provide finances Loans are available for tenors ranging from 5-12 years and repayment are in

semi-annual installments

Interest rates are usually fixed and are determined on the date of submission

clear proposal to ECA - Minimum subsidized interest rates (Commercial Interest Reference RatesCIRRs) are applicable

MTN PROGRAM
An EMTN program is essentially a documentation platform which provide the

issuer an opportunity to enter frequently, efficiently and economically the international debt capital market: Can be used for large and small issuances; Multicurrency and Structured notes Any number of times with the cap on the aggregate amount Investor may initiate issuance- Reverse Enquiry

INTERNATIONAL BOND ISSUE : EURO BONDS

Bond issued internationally outside home countrys market in own or different

currency. e.g. a firm issuing yen bonds outside Japan e.g. - a US firm issuing dollar bonds outside US. Long tenure possible up to 30 years even perpetual Huge depth of market Primary market for first issue of securities

Secondary market trading after issue Private placement- Recent product USPP

EXPORTCREDIT
(OECD CONSENSUS)
content Minimum of 15% of contract to be paid before the use of the ECA facility Exporter have to win contract on product quality and price competitiveness Consensus is the basis for the actions of ECAs. An agreement for level playing field. Consensus rules relate to both terms of covers and terms of funding Borrower countries are classified under two categories An ECA can support finance or guarantee maximum of 85% of the export

and not on beneficial finance terms

KEY ADVANTAGES OF LOANS AREo New/consistent documentation can be established o High flexibility in terms of amount,drawdown,currency,interest rate payment redemption especially compared to bonds o Financing of large amounts possible or

CHAPTER 5 Case study----NTPC Energy Efficiency Programme-Kfw

Purpose-

To finance the project for rehabilitation and modernisation of NTPC ltd thermal power plants like Talcher,TPS Phase III, Singrauli Phase II and Farakka, Anta,Rihand etc in India..

Business

Daily

from

THE

HINDU

group

of

publications

Wednesday, Mar 28, 2007

New Delhi March 27 NTPC has signed an agreement with German lending agency KfW for a term loan of $100 million (nearly Rs 440 crore) to part-finance renovation and modernisation of its power plants. The loan is an unsecured facility without sovereign guarantee bearing variable interest linked to LIBOR with door-to-door maturity of 10 years, an NTPC release said. This would be the first loan that extended directly by KfW to NTPC, the statement said, adding that KfW had earlier routed funding for projects through the Government. The company had earlier announced plans to invest Rs 1,365 crore for renovation of three power plants - Singrauli, Rihand and Vindhyachal - with a total capacity of over 6,500 MW to enhance their lifespan by up to 25 years.

Lender KfW(Kreditanstalt fr Wiederaufbau)

Borrower NTPC LTD.
Two objectives of international financing department are :1.1. Centralized payment of currency (USD,EURO, JPYetc..) in respect of construction projects i.e Renovation & Modernization(R&M) but not repair & maintenance. 1.2. Arranging finances in foreign currencies where local currencies are

arranged by Budget department. Hedging policy is not the policy of NTPC LTD in accordance with regulations under CERC Act

INTRODUCTION- KfW
KfW is a German government-owned development bank, based in Frankfurt. It name originally comes from Kreditanstalt fr Wiederaufbau, meaning Reconstruction Credit Institute, and it was formed after World War II as part of the Plan. Recently, KfW has tied up with the Industrial Development Bank of India (IDBI) to help Indian companies identify projects, fund the projects and help earn carbon credits. The tieup would also help the companies find a suitable buyer in the International market. Kfw has been doing deal with NTPC LTD for many a times. This time a loan amounting US$100 million (100,000,000) , subject to negotiations has been borrowed.

The lender and the borrower have been agreed to undertake the financing of the project NTPC Energy Efficiency programme. To achieve this goal the lender has prepared to provide the loan to the borrower on 23 rd march 2007.

The purpose of the loan is to finance both local and foreign exchange costs for the rehabilitation and modernisation of NTPC LTD thermal power plants. In accordance with ECB ( external commercial borrowings ) guidelines , an amount subject to US $500 million requires no RBI approval. Initially , NTPC LTD was engaged with ADB ( Asian development bank) for raising the loan of US $300 million. The US $200 was then decided to be raised through KfW .the negotiations started in the year 2006.

RENOVATION & MODERNISATION -R&M

In order to bridge the gap between demand and supply, especially in the context of limited financial resources available, it has become imperative to look for other options which are not as capital intensive as new capacity addition and which could be implemented in a comparatively shorter time frame. In this regard, optimum utilisation of existing installed capacity in the country to maximise the generation through Renovation & Modernisation (R&M) of existing power plants is considered to be the most cost effective option.

Objectives OF R&M Efficiency upgradation

Environmental control updating Improved reliability

NTPCs Purpose of R&M

Increasing output Improving heat rate Reducing future O&M cost Increasing avaibility Extending life time Reducing CO2 emissions Reduced fuel consumption Increased electrical output

R&M activities in NTPC

One of the major contributors for sustenance of the high performance levels of

NTPC units in spite of ageing of units has been the specific R&M interventions when the units completed 100,000 hours of operation which would otherwise result in serious accidents and danger to human life and plants. First cycle of R&M mainly one-is-to-one replacement- cater to specific problems,

obsolescence and the changing environmental standards.

Categories of R&M are One to one replacement- restoration of lost capacity, improved plant availability,

capacity utilisation and life extension of the plant through replacement of an existing component with an identical new component to take care of aging & natural wear and tear .

To

cater

to

fast

changing

environmental/statutory

standards-replacement

/augmentation of existing equipment with superior equipment and installation of new systems

To cater to changes in input/output of the plant-replacement of equipment to

cater to the deteriorationin the quality of the various inputs such as coal and water and outputs such as CERC guidelines etc.

To cater to technological obsolescence-replacement of equipment which has

become obsolete due to technological upgradation .

NTPC s Strategy for R&M

First cycle of R&M activities:

For coal fired units : after 100,000 hrs of operation For gas fired units : after 80,000 hrs of operation NTPC mainly targets sustenance of the high level of performance and caters to

obsolescence &environmental norms for the first cycle of R&M. The identification of R&M needs are essentially based on : Results of residual life assessment (RLA) studies. Review of O&M history, failure and input output changes.

PROCEDURAL ASPECTS OF NEGOTIATING A FOREIGN CURRENCY LOAN

In the pre-negotiation phase, the borrower must prepare an Information memorandum. This is particularly necessary for the borrowers who are new to the market . this document must contain information about the borrower the amount the maturity of the desired loan intended use of the loan the survey of the borrower country and its economy and so forth details of thee project should be included.

The information memorandum constitutes the basis of decision making by the banks and should be accurate and comprehensive

The borrower sends the invitations to submit credit proposals to the various banks accompanied by the information memorandum. Usually they are sent to the banks with whom the borrower had dealings in the past

The borrower should then constitute a loan negotiating panel consisting of its top management officials, finance managers . an operating officer and a legal officer.

The replies from the banks would spell out the business terms under which they would be willing to provide a loan . these terms would indicate the interest rates( spread over LIBOR in case of floating rate loans) management fees commitment fees participation fees repayment schedule grace period

The offer letter will indicate how long the offer is Valid . After the scrutiny of all the proposals received , the borrower awards the mandate to the bank to be the LEAD MANAGER(s). The acceptance of the proposal implies acceptance of th business terms and other conditions of the offer.

The negotiation phase next leads to the LOAN AGREEMENT. The banks present the borrower with a draft agreement at the start of the negotiations and the negotiations proceed sequentially through all the provisions.

The major provisions pertain to : 1. 2. 3. 4. 5. The business terms Changes of the circumstances Declaration of the borrower(representations and warranties) Conditions of the closing Positive and negative covenants

This scenario has been taken up as a Sample to have a broad horizon on how the negotiation takes place between Lender and Borrower and what are the lists of documents needed.

Initially,

KfW

gave there TERMS AND CONDITIONS ( lender) in

accordance with loan. Indicative Terms and Conditions were :-

( TERM SHEET)

Financial Assistance Lender KfW (Kreditanstalt fr Wiederaufbau ) Borrower NTPC LTD Currency Euro, US Dollar , Yen , other currencies on request ( later only US Dollar was requested ) Financial Instrument Term Loan . Date of signing 23rd March 2007. Amount 100 m USD

Maturity 10 years Availability period March 31st 2010. Grace period 3 days from the day of effectiveness of the loan agreement Payment in 14 consecutive half yearly instalments. Interest rate floating based on 6 month USD Libor (margin) Interest payment date March 15th and September 15th Day count factor- actual days / 360. Interest margin-xxx

Commitment fee-xxx

Management fee-xxx Collateral negative lien Covenants standard NTPC covenants like minimum debt equity ratio of 70:30 , parri passu clause , negative pledge and cross default clause . The environmental guidelines and resettlement and rehabilitation policy are formulated under Indian laws and regulations . Implementation of the loan is intended as per attached draft work schedule , which may be updated from time to time depending upon the progress of the project The terms and conditions as set out include the most important ones only. All further details and the usual clauses applicable to the international finance agreements will be contained in the loan agreement to be mutually agreed and concluded between NTPC LTD and kfW.

These indications are made under the provisions that KfWs due diligence and the risk assessment will lead to a satisfactory result, All necessary permits, approvals and authorizations required for the conclusions and implementations of the loan agreement will be obtained KfW Board will approve the loan.

Under the

Terms & Conditions given by NTPC LTD,

The currency in the form of US Dollar was requested. Initially the loan was raised only for Badarpur power plants but later on it was extended to other plants including ANTA AND UCHAR for rehabilitation and modernisation and the objectives of rehabilitation and modernisation Once the terms and conditions were finalised by both the lender and the

borrower , the approval from

Board of Directors

is taken .

The Memorandum of Association (MOA) and Articles of Association are taken into account. It states: Borrowing power conferred upon the company under objects incidental or

ancillary to the attainment of the main object Borrowing Power are stated as to borrow money or to receive money or

deposits for the purpose of financing the business of the company either with security or mortgage or other security charged on the undertaking on all or any of the assets of the

company including uncalled capital and to increase, reduce or pay off any such securities. And under Articles of Association Subject to the provisions of Section 58A, 292 and 293 of the Companies Act, and

Government Guidelines issued from time to time, the Board may be means of resolution passed at meetings of the Board from time to time accept deposits or borrow and/or secure the payment of any sum or sums of money for the purpose of the Company.

COMPANIES ACT 1956 SECTION 292

The Board of Directors of a company shall exercise the following powers on behalf of the company, and it shall do so only by means of resolutions passed at meetings, a) The power to make calls on shareholders in respect of money unpaid on their

shares ; b) c) d) e) The bower to issue debentures ; The power to borrower moneys otherwise than on debentures ; The power to invest the funds of the company ; and The power to make loans.

finalized ,

Under

the

Agenda,

the

Processing Work Schedule

was

Amortization installment Amortization installment Disbursement of funds

OCT 17 OCT 10 ARRIL 07

Finalization of the loan agreement Approval of ECB Board decision Due diligence mission Analysis of documentation Content of NTPC LTD to term sheet

FEB / MARCH 07 FEB O7 DEC 06 NOV / DEC 06 NOV 06 OCT 06

KfW PROPOSAL OF AMOUNT OUTSTANDING 100.00 100.00 100.00 100.00 100.00 100.00 92.86 85.71 78.57 71.43 64.29 57.14 50.00 42.86 35.71 28.57 21.43 14.29 7.14 0.00

KfW submitted its proposal on how repayment

amount would be discharged.

DATE PAYMENT 1-Apr-07 1-Apr-07 1-Apr-09 1-Oct-09 1-Apr-10 1-Oct-10 1-Apr-11 1-Oct-11 1-Apr-12 1-Oct-12 1-Apr-13 1-Oct-13 1-Apr-14 1-Oct-14 1-Apr-15 1-Oct-15 1-Apr-16 1-Oct-16 1-Apr-17 1-Oct-17 REPAYMENT AMOUNT NO.OF DAYS 366 365 183 182 183 182 183 183 183 183 182 183 182 183 182 183 183 183 182 183 6.756 PRODUCT 36600 36500 18300 18200 18300 18200 16993.38 15684.93 14378.31 13071.69 11700.78 10456.62 9100 7843.38 6499.948 5228.31 3921.69 2615.07 1299.48 0 246600

7.14 7.14 7.14 7.14 7.14 7.14 7.14 7.14 7.14 7.14 7.14 7.14 7.14 7.14 0 100

Once the proposal of KfW proposal on repayment was decided, for the

purpose of due diligence Two samples were taken ANTA coal station and UNCHAHAR gas station out of other stations for vigilance. Several presentations were made to board of directors and lender for the successful implementation.

Questionnaire

for due diligence was conducted by KfW in NTPC LTD in

accordance with the LOAN AGREEMENT. After several modifications , the final Questionnaire was as follows :-

Renovation & Modernization policy In march 2006 , NTPC has proposed to reorganize the R&M activities. As a new feature R&M aims at upgrading the

Please provide answers to the following questions.

power plants beyond 150,000 operating hrs in order to achieve higher efficiency , higher together output, with higher availability

reduced

environmental

impact. Anta and Unchahar are taken as samples for the above purpose Has the new R&M scheme been accepted by NTPC LTD management and board and CERC? It has been accepted by the NTPC management. Reorganizing the R&M activities is an inhouse exercise and does not require the consent of CERC.

Has new engineering manpower

Existing

manpower

in

R&M

will

be

been allocated accordingly? Which power would be included in KfW scheme?

strengthened progressively Anta power plants like Talcher,TPS Phase III, Singrauli Phase II and Farakka, Anta,Rihand etc in India..

Projected balance sheet and profit

Projections have been submitted and the matter was explained to the

and loss account . please provide the complete excel model for better

representatives

understanding of the figures

Environmental guidelines undertaken with respect to

project.
To achieve and maintain a leaders role in the area of environment management in

the power sector in the country. To keep in the view the various environmental requirements in all its business

decisions . To continuously adopt ways and means for Environment Protection and Environment

improvement around its business units. To adopt sound environment management practices.

To aim at full compliance with the statutory norms and requirements.

To meet strong commitments to the environment and considering the multifaceted requirement of the environmental issues, the institutional framework in NTPC provides for dedicated Environment Management Group ( EMG) at the station level as well as the corporate level. The various Environmental Groups alongwith their placements under different directorates at the corporate centre are as follows o o o o Environment Management Group (EMG) at the operations level. Environment Science Group ( ESG) in R&D centre in the operations division. Environmental Engineering group (EEG) in the engineering division. Safety,Welfare and Public Health in the personnel division.

Environmental concerns which were Highlighted

Selection of proper equipment and systems. Technology adoption like Waste water treatment plants , Cooling Towers, Sewage

Treatment Plants. Develop standards and guidelines for monitoring methods , frequency, analysis

and data reporting Environmental research .

Norms and standards

There are number of acts related to Environment and guiding rules about pollution. Following acts are in existence as of today

Factory act Electricity act Air act Water act Environmental protection act

In addition to the above Environment Policy of the organization , all operations of NTPC have been certified for ISO-14001 by national/ international certifying agencies and therefore , each station has an environment policy as a part of Environment Management Systems

Various rounds of discussions were held for the finalization of the LOAN

AGREEMENT
It included :1. 2. 3. 4. Definitions an interpretation loan Disbursement Fees

5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18.

Interest Repayment and Early repayment Calculations and payments in general Taxes , Duties and costs Representations and warranties by the borrower Financial ratios General undertaking of the borrower Undertakings with regard to the project Information covenant Termination Transfer of rights and obligations General provisions Notices and communications Applicable law : Dispute resolution and jurisdiction.

1) a)

Definitions and Interpretation

Banking day - a day ( other than Saturday or Sunday ) on which

commercial banks are open for general business in Frankfurt am main , Germany, new york , U.S.A and London,UK. b) Borrower NTPC LTD , a company existing under the laws of the

India , whose registered office is at NTPC bhawan , scope complex, 7 institutional

area , lodhi road new delhi 110003 registered in the commercial register of the local court in new delhi under registration number. c) Early repayment any repayment of an outstanding Loan amount

in advance of its maturity as set forth in the repayment schedule . d) e) ECB guidelines as it is prescribed above. Financial year- means the financial year of the borrower which is

determined to be the period from the 1st April of the given calendar year until 31 st march of the following calendar period f) Interest period a period during which interest at a variable

interest rate is payable on a loan amount or for which default interest and lumpsum compensatory damages are charged. g) Lender- KfW , a public law institution existing under the laws of the

federal republic of Germany with its headquarters in Frankfurt am mian. h) i) Margin shall be xxx % per annum. Reference interest rate USD LIBOR or in the event the relevant

information does not appear on the Reuters or Bloomberg pages specified under the definition of USDLIBOR , the replacement rate 2.

loan

The amount is subject to the provisions of this agreement , KfW shall

grant the borrower a loan for an amount of upto USD 100,00,000 for the purpose to fianance the project . 3.

Disbursement

a) Drawdown notice- The borrower shall have the right to submit to KfW

b) Minimum amount with the exception of the last disbursement of funds , each loan amount loan drawn must not be less than USD xxx ( in dollars ) . c) Availability period KfW shall have the right to refuse the disbursement of funds

after march 31, 2010.

4.Fees
Management fees- the borrower shall pay the lender a one time management fees in the amount of USD xxx at the earliest of 30 days after the date of signing of this agreement or before the first disbursement under the loan .

5. Interest a) Interest shall accrue and shall be paid on each loan amount as from the date

the account maintained by the borrower at KfW s debited with such loan amount to the amount necessary for repayment thereof is credited to the account b) c) Interest payment dates The interest accruing on a loan amount shall be paid by the borrower in arrears On the following dates Before the maturity date of the first repayment installment, in each case on march 31 and September 30 of nay given year , commencing from 30 2007 d) Interest payments at the variable interest rates would be calculated on the basis of Reference interest rates plus the margin

6. Repayments and Early Repayments

The borrower shall pay to the lender in 14 equal consecutive semi- annual installments according to the following repayments schedule Maturity date repayment installment Sep 30 2010 March 31 2011 Sep 30 2011 March 31 2012 Sep 30 2012 March 31 2013 Sep 30 2013 March 31 2014 Sep 30 2014 March 30 2015 Sep 30 2015 March 31 2016 Sep 30 2017 March 31 2017 7,142,850 7,142,850 7,142,850 7,142,850 7,142,850 7,142,850 7,142,850 7,142,850 7,142,850 7,142,850 7,142,850 7,142,850 7,142,850 7,142,850

7. Taxes, Duties and Costs

a) b) c) All payments made by the borrower on the basis of this agreement shall be made without any deductions or withholdings . In the event if it is required by law or any other reason to make deductions then that equivalent amount will be paid to KfW .

d) e) f) g) h)

Duties , costs and expenses Taxes, charges and other public duties and expenses incurred in connection with the preparation , negotiation , execution, registration. amendment of this agreement shall be borne by the borrower . Increased costs include any reduction in the KfW percentage return on equity or any reduction in the amount owned by the borrower.

8. Representations and Warranties by the borrower The borrower expressly represents and warrants to KfW that the following is true and correct Existence of legal entity the borrower is a limited liability company , duly incorporated and validly.Existing under the laws of Republic of India . Accurate financial information the statements regarding the assets , the financial condition and the results of the operations are true, complete and accurate Accurate periodic reports the most recent periodic reports submitted to KfW in each case give a true, complete and accurate view of the borrowers assets ,its financial condition and its results of the operations . Negative pledge to the extent the borrower has not reported , the assets of the borrower and all of companies of the group are free and clear from any encumbrances .

9. Financial Ratios
Unless otherwise agrees , the borrower shall at all times maintain and abstain from any action that may result in the breach of the following financial ratios

Leverage ratio the borrowers leverage ratio may not be higher than 2:1 Interest coverage ratio the borrowers interest coverage ratio may not be lower than 1.75:1

10. Reports
The following reports have to be submitted to KfW on the following dates Annual financial statements no later than 150 days after the end of the respective financial year Annual report immediately after publication Business plan no later than 30 days before the end of financial year Progress report- no later than 30 days after march 31 and September 30 of each year Periodic reports for as long as KfW has any claims against the borrower under the loan agreement Progress reports for as long as the project is being implemented . The reports are sent on 6 months basis. Periodic report shall include Executive summary and project specific . The information may include past financial year- name of the plants rehabilitated, budget spent on R&M measures Current financial year name of the plants to be rehabilitated , measures planned Environmental issues emissions ,ash generated, ash usage The progress report shall be accompanied by the itemized list signed by

the internal auditor of the borrower of all ininvoices and amounts paid in connection with the project

11. General undertakings of the borrower

the borrower shall not

without the prior consent of KfW change the business activity in which it has engaged itself at the time of agreement.

The borrower shall make periodic reports in accordance with Indian GAAP Parri passu ranking the borrower shall ensure to the extent legally possible that its payment obligations under this agreement rank at least pari passu with all its other present and future unsecured and unsubordinated payment obligations .

12. Undertakings with regard to the projectborrower undertakes with KfW that it will : use the complete amount of the loan to financethe project

The

procure the supply and work contracts related to the implementation of the project. Ensure that no bidder will participate in the bidding process which is ruled out by sanctions issued by the UN security control.

13.Termination- The events of defaults are

Non payment Other breaches of duty that cannot be cured

Misrepresentation Cross default Insolvency Legal consequences of an event of default are that KfW may terminate this agreement in whole or in part

14. Notices & Communications

Any notices or communications in connection with the agreement must be in writing and shall include as a reference Loan no. xxx and the name of the project Any notices and communications in connection with the agreement would be effective upon their receipt . All correspondence between KfW and the borrower in connection between the agreement shall be conducted in English language only.

Till now with successful implementation of all the clauses of LOAN AGREEMENT , NTPC LTD has withdrawn $43 million

CHAPTER 6 GROWTH PLANS

Growth plans
Over the last three decades, NTPC has spearheaded development of thermal power generation in the Indian power sector. In this process, it has built a strong portfolio of coal and gas/liquid fuel based generation capacities. The company has made initial forays in the area of hydropower development and plans to have a significant share of hydro power in its future generation portfolio. Although NTPC is also offering technical services, both in domestic and international markets, through its Consultancy Wing, the generation business would continue to be the single largest revenue generator for NTPC. The Indian power sector is witnessing several changes in the business and regulatory environment. The legal and policy framework has changed substantially with the enactment of the Electricity Act 2003. To meet the twin objectives of ensuring availability of electricity to consumers at competitive rates, as well as attract large private investments in the sector, a new Tariff policy has also been issued. The power sector thus offers a mixed bag of challenges and opportunities to players and NTPC would continue to review its business strategy and portfolio in light of these changes.

Establishing a Global Presence To become a truly global company serving global markets, it is essential for NTPC to establish its brand equity in overseas markets. NTPC would continue to focus on offering Engineering & Project Management Services, Operations & Maintenance services, and Renovation & Modernization services in the international market. Establishing a successful services brand would be a precursor to taking higher investment decisions in different markets. Going forward, NTPC would continue to evaluate various options for strengthening its presence in global markets including setting up power generation capacity, acquisition of gas blocks etc. Circa 2017: NTPCs corporate profile By the year 2017, NTPC would have successfully diversified its generation mix, diversified across the power value chain and entered overseas markets. As a result NTPC would have altered its profile significantly. Elements of the revised profile that NTPC would seek to achieve are: Amongst top five market capitalisation in the Indian market An Indian MNC with presence in many countries Diversified utility with multiple businesses Setting benchmarks in project construction and plant availability & efficiency Preferred employer Have a strong research and technology base

Loyal customer base in both bulk and retail supply A leading corporate citizen with a keen focus on executing its social responsibility

Findings - :

SELECTED FINANCIAL STATEMENTS 1. CURRENT RATIO - CURRENT ASSETS

CURRENT LIABILITIES

2003- 2004- 200504 05 06 2006-07 1.67 1.91 2.56 3.16

The current ratio of the company measures its short term solvency, that is its ability to meet the short term obligations . It indicates the rupees of current assets available for each rupee of current liability . It is a measure of margin of safety to the creditors.

2. RETURN ON CAPITAL EMPLOYED = NET PROFIT AFTER

TOTAL CAPITAL EMPLOYED

2003-04 20042005200605 06 07 12.93 12.77 12.46

13.89

Capital employed provides the basis to test the profitability related to the sources of the funds. In the year 2006-07 it has been at 13.89 with the highest, which indicates how efficiently capital employed is being used as compared to 12.93 in the year 2003-04

3. RETURN ON NET WORTH = NET PROFIT AFTER TAX

AVERAGE TOTAL SHAREHOLDERS EQUITY

200320042005200604 05 06 07 14.94 14.33 14.16 15.57

This ratio reveals how profitably the owners funds have been utilized by the firm with the improvement in the ratio from 14.94 to 15.57. They dont opt for diluted equity ( AS-20) .

4. DEBT TO EQUITY = LONG TERM DEBT

SHAREHOLDERS EQUITY

200320042005200604 05 06 07 0.43 0.41 0.45 0.5

The relationship between borrowed funds and the owners capital is a popular measure of the long term financial solvency of the firm. This ratio reflects the relative proportions of the debt and equity in financing the assets of the firm. For financing the new projects the ratio of 70:30 is made applicable, which is continuously improving year after year.

5. INTEREST COVERAGE RATIO EARNINGS BEFORE INTEREST AND TAX

INTEREST

200320042005200604 05 06 07 2.81 5.01 4.74 5.79

This is also known as Time Interest earned ratio . This ratio measures the debt servicing capacity of a firm . It indicates the extent to which a fall in the EBIT is tolerable in the sense that the ability of the firm to service its interest payments would not be adversely affected.

6.OPERATING PROFIT RATIO = EARNINGS BEFORE INTEREST AND TAXES

SALES

200320042005200604 05 06 07 1.86 3.52 3.12 3.78

It has increased considerably over the years. This ratios are indicative of managements ability to operate the business with sufficient success not only to recover from revenues of the period or expenses.

7. Earnings per share = NET PROFIT AVAILABLE TO EQUITY HOLDERS

NUMBER OF ORDINARY SHARES OUTSTANDING

200320042005200604 05 06 07 6.73 7.26 7.06 8.33

EPS has increased over the years , it does not mean that necessarily the firms profitability has improved because the increased profits to the owners may be the effect of an enlarged equity capital as the result of profit retentions , though the number of ordinary shares outstanding still remains constant.

8. P/E RATIO

MARKET PRICE EPS

MARKET PRICE AS ON 31ST MARCH 2007 = Rs 150 i.e 18.

The P/E ratio reflects the price currently being paid by the market for each rupee of currently reported EPS. It measures the investors expectations and the market appraisal of the performance of the firm. It will take 18 years to recover at the present market price.

LEARNINGs
o I learned how International markets promote domestic investments and

allows the countries to import the capital.

o I learned how other departments of the company are interlinked with

International financing department and the implications of basic terms. o I learned the general management practices followed at NTPC LTD in

International Financing, and to get the International exposure of the Industry working abroad o To learn the functioning of Finance Department and funding

requirements in power sector.

RECOMMENDATIONS Conclusion

AND

The potential benefits of International finance are fairly clear. Access to worldwide capital markets may allow a company to smooth its financial needs, borrowing in bad times and lending in good times. As a related matter, International markets can promote domestic investment and growth by allowing countries to import capital.

Internationalization may increase competition, and therefore lead to more efficient banking systems or cheaper securities offerings.

NTPC LTD may opt for Hedging policy after completion of CERC tariff rates, this would help them to run their Ultra mega projects. NTPC LTD may apply for ADR/GDR or right issues for further procurement of funds.

GLOSSARY
LIBOR- London Inter Bank Offer Rate MIBOR- Mumbai Inter bank Offer Rate Yield- Annual Rate of Return on an Investment expressed as a %. G Sec- (Yield on) Government Securities UST- Treasury Rate of US Securities Forex- Foreign Exchange (currency of any country other than domestic currency Spread- the additional amount (generally in %) charged by the lender/seller over the Benchmark Rate; CIRR- Commercial Interest Reference Rate used by OECD member countries of ECA Spot- Forex Quotation for two business days hence (T+2) Basis Points- 100th part of a Percentage i.e. 1% = 100 Basis Points Floating Interest Rates: Rate of Interest which changes with every interest period.

Fixed Interest Rate: Rate of Interest which remains constant over entire life of the loan

Interest Reset- a clause instituted in the loan agreement with fixed interest rate which allows the lender to revise the interest rate with reference to a given benchmark periodically or on specified dates.

Foreign Bonds- Bonds issued by a non-resident in the domestic currency- eg Bonds issued by an Indian Company in $ in US

Yankee Bonds- Foreign Bonds issued in US i.e. $ bonds in US Samurai Bonds- Foreign Bonds issued in Japan i.e. bonds in Japan

BIBLIOGRAPHY

WWW.INFOSEEK.COM WWW.WIKIANSWERS.COM WWW.CERC.NET.IN WWW.BBA.COM WWW.INDIAMINT.COM WWW.NTPC.CO.IN

INTERNATIONAL FINANCIAL MANAGEMENT- P G APTE