Final Results

24 July 2013

Greenko Group PLC

("Greenko", "the Company" or "the Group")

Preliminary Results for the year ended 31 March 2013

Greenko, the Indian developer, owner and operator of clean energy projects, today announces its preliminary unaudited results for the year ended 31 March 2013.

Financial Year Highlights

·; Revenue increased 10.4% and adjusted EBITDA increased 27.5%, on a constant currency basis

·; Reported revenue increased 3.8% to €38.3 million (2012: €36.9 million)

·; Adjusted1 EBITDA increased 19.9% to €32.8 million (2012: €27.3 million)

·; Power assets grew 69.0% to €516.7 million (2012: €305.8 million)

·; €205.6 million of committed but undrawn project debt currently in place

Operational Highlights

·; Generation grew 15.1% to 886.0 GWh (2012: 769.8 GWh)

·; Completed and operational capacity grew 69.4% to 309.2 MW (2012: 182.6 MW)

·; 425 MW of Himalayan hydro development concessions added in Himachal Pradesh and Arunachal Pradesh

Post year end

·; 806.6 MW operating, completed or in construction

·; £100 million equity investment received from the Government of Singapore sovereign wealth fund ("GIC")

·; Appointment of Keith Henry as Non-Executive Chairman and John Rennocks as a Non-Executive Director

1. Reported EBITDA adjusted for the one-off non-cash 2008 LTIP charge to enable a like for like comparison with the previous year.

Commenting on the results, Anil Chalamalasetty, CEO and MD of Greenko, said: 

"We are pleased with last year's progress. We grew EBITDA 20%, improved the margin from 74% to 85%, and increased generating capacity by 70% to 309 MW. As of today, we have 806 MW operating or under construction and are well on the way to our 1,000 MW target. Our focus for the current year is on commissioning a further 250 MW of new wind power capacity, and we continue to see great opportunities for renewable energy in India's rapidly developing power market."

A presentation for analysts will be held at 9.30am this morning at Tavistock Communications, 131 Finsbury Pavement, London, EC2A 1NT. Please contact Matt Ridsdale or Mike Bartlett on 020 7920 3150 if you would like to attend.

For further information please visit www.greenkogroup.com or call:

Report to Shareholders

Chairman's Statement

This was a successful year for Greenko. Our operating performance was good, EBITDA was ahead of expectations and we now have 806.6 MW either operating or under construction. During the year, we acquired 61 MW of attractively priced operational hydro assets; added six large Himalayan hydro development concessions; brought 180 MW of wind power into construction; and secured a £100 million equity commitment from GIC. Outside our control was on-going currency weakness that affected rupee profits reported in Euros and an unusually poor monsoon that impacted southern hydro performance. However, our portfolio diversification strategy meant that a strong performance by our northern hydro assets largely offset the monsoon's impact in the south, while on a constant currency basis our revenue increased by 10.4% and adjusted EBITDA by 27.5%. Our new financial year has also started strongly: Ratnagiri, our first wind farm, was commissioned; our second wind farm has been completed ready for connection; half the turbines are already up at our third wind farm; and the monsoon's early arrival is a good start to the year.

Substantial capacity growth is expected in the 2013-14 financial year, thanks to the major development programme that was completed in the 2012-13 year. We anticipate taking our fully commissioned asset base from 244 MW in March 2013 to over 500 MW this year, as the initial phases of our main wind clusters complete construction. Subsequent phases are likely to follow on swiftly, as the access roads and grid connections are already in place. We recently added Gamesa as a turbine supplier to complement GE, and help deliver this year's construction programme.

We have 65.6 MW of wind power already operational, with a further 51.2 MW completed at Basvanbagewadi1 and ready to deliver power when the grid modifications are completed in mid-August 2013. A further 258.6 MW of wind projects are currently under construction, with 471.5 MW at an advanced stage of development and soon ready for construction. In addition, there is a substantial pipeline of future opportunities that should feed into our active development pipeline.

Our hydro projects under construction are making good progress and remain set to begin commissioning in 2014. The 96.0 MW Dikchu project in Sikkim is our largest hydro project under construction. Despite the challenging terrain found in the Himalayas, the unusually high rainfall in recent months and the requirement for almost 10 km of tunnelling, the project is on budget and on track to start commissioning toward the end of the 2014-15 financial year. Building on the capabilities created at Dikchu, we secured six northern hydro development concessions (totalling 425 MW) that will enable us to access the high voltage transmission grid and sell across the entire Indian market.

We were delighted to welcome GIC, the Government of Singapore sovereign wealth fund, as an investor. Its investment of £100 million into our ordinary shares shows great confidence in our business model and the Indian renewable energy market. This was a demanding process and the executive team are to be congratulated on their success in attracting an investor of GIC's stature.

Market

The backdrop for power in India remains positive, with demand continuing to outstrip supply. Clean energy is an increasingly important part of the Indian energy market that attracts strong regulatory support and a favourable tariff structure. The renewable 'cost free' and local nature of our fuel source creates a unique opportunity for Greenko's portfolio of clean energy projects, which can now profitably sell power in most States at or below the price of conventional generation. This is further helped by the fact that wind and run-of-river hydro projects are quicker to build and do not require the onerous permitting and infrastructure associated with conventional generation. The recent recapitalisation of many State Electricity Boards has resulted in significant increases in power prices, from which we expect our projects under construction and active development to benefit.

Strategy

Our strategy is to create a well-diversified power portfolio that maximises returns for shareholders. Our focus remains on States that offer a good renewable resource, as well as a supportive economic and regulatory environment for renewable energy. As such, we work with project clusters that build on our local knowledge and goodwill, to ensure faster implementation, better operational management and more robust resource data. This mitigates risk, helps secure multiple revenue streams and positions us to capture the most attractive opportunities.

The next few years will see an increased focus on northern run-of-river hydro, which we believe is the most attractive power asset in India today. We also anticipate increasing average project sizes, to take advantage of the improved transmission network to reach a wider market of valuable commercial tariffs. To this end, we are now investing in the front-end development of projects that will drive our growth beyond 2015, with site work beginning later this year at the six run-of-river hydro projects recently announced in Himachal Pradesh and Arunachal Pradesh. As the opportunities arise, we will continue to evaluate, on a case-by-case basis, potential hydro asset acquisitions that offer attractive returns.

We have also built additional infrastructure capacity at our current wind power clusters, such that future expansion can happen more quickly and efficiently, in line with our philosophy of focussing on utility scale wind assets. While we will typically still build in phases of 50 MW, the eventual clusters are likely to be significantly larger and we will continue to use the latest Class-III wind technology to optimise returns. We minimise the risks of project cost over-runs by awarding fixed price 'engineering, procurement and construction' contracts with our main contractors, and our project teams work closely with the contractors to support and monitor their performance. We make full use of India based suppliers and almost all of the equipment, materials and services for our projects are sourced locally.

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1Fortune Five Phase 1

Board

At the end of the 2012-13 financial year Y Harish Chandra Prasad stepped down as a Director after seven years of diligent service, during which he successfully led the Board as Chairman from its inception. I know that all my Board colleagues join me in thanking Harish for his unstinting support over these formative years. Post the year-end, we were delighted to welcome John Rennocks to the Board as a Non-Executive Director. John brings significant FTSE-100 board experience and has joined our Audit Committee.

Outlook

With demand for power in the Indian market increasing and an emphasis on generation from clean energy sources, Greenko is very well positioned for strong and sustained growth. Although the Indian economy's growth slowed this year and uncertainty around the upcoming elections impacted the currency, we believe India's progress remains very attractive and we are confident of delivering substantial long-term value to our shareholders.

Over the next two years the shape and size of our operating portfolio will change substantially, as we add four large wind farms and complete the construction of six hydro projects. Developing and constructing projects, often in remote locations and very difficult terrain, is never an easy task but the experience gained has enabled the Greenko team to meet those challenges. There is now real momentum behind Greenko and our shareholders will see further tangible progress this year as we commission a significant number of projects. We remain on track to reach our target of 1,000 MW in 2015 and see Greenko emerging as one of the leading players in India's power generation sector. We look forward to reporting further progress to you in the coming months.

Keith Henry

Chairman

Executive Directors' Statement

Introduction

It is a pleasure to present Greenko's preliminary unaudited financial results for the year ended 31 March 2013, our sixth year as a public company. We demonstrated profitable growth, with a 19.9% increase in EBITDA and continued to build a portfolio that establishes Greenko as a strong utility in the Indian energy market. During the year, we agreed a £100 million investment into our ordinary equity with GIC. This gives us the balance sheet strength to readily reach our 2015 target of 1,000 MW and puts in place the foundations for growth beyond that. Our total portfolio currently available to generate power is 309.2 MW, with a further 51.2 MW completed and 446.2 MW under construction. We expect to commission several projects in the coming months and substantially increase our generating portfolio.

Financial Review

For the full year, the Company's revenue was €38.3 million (2012: €36.9 million), with generation of 886.0 GWh (2012: 769.8 GWh). The Rupee's depreciation against the Euro by approximately 6.4% over the financial year has again led to foreign currency translation differences in our accounts. Although generation increased 15.1%, reported revenue only increased 3.8%, due to a change in the generating mix and more significantly, the weakness of our functional currency (the Indian Rupee) relative to our reporting currency (the Euro). On a constant currency basis, revenue would have increased by approximately 10.4% and adjusted EBITDA by 27.5%.

Adjusted EBITDA, a key performance indicator for Greenko, increased 19.9% to €32.8 million (2012: €27.3 million), despite the adverse currency movements. Adjusted profit before tax was down slightly at €12.0 million (2012: €13.9 million) as EBITDA growth was offset by the depreciation and interest charges attributable to the 61 MW of hydropower added during the year. This was exacerbated by the timing of the Sumez acquisition, which occurred towards the end of the northern generating season. Adjusted fully diluted EPS was 5.42 cents (2012: 6.37 cents) reflecting the impact of the shares issued in June 2011 and June 2012.

The adjusted EBITDA margin increased from 74.0% to 85.4% and was affected by a number of one offs. The impact of the non-cash charge for the 2008 LTIP (€4.0 million), reported in our interim results, was partly offset by the sale of an unused biomass project licence (€1.2 million) and compensation received by the AMR (24.75 MW) and Rithwick (24.75 MW) hydro plants for reduced generation due to water abstraction by the State (€1.8 million). Underlying EBITDA (i.e. excluding share payments and the fair value adjustment) increased 18.4% to €25.3 million (2012: €21.4 million) on a reported basis and the margin increased to 65.9% (2012: 57.8%), while in constant currency terms underlying EBITDA would have increased 25.9% to approximately €26.9 million.

During the financial year, we invested €219.9 million in power assets through on-going construction activity and the hydropower acquisitions. This resulted in a 69.0% increase in Plant, Property and Equipment and Intangible Assets to €516.7 million (2011: €305.8 million). Cash (including deposits) at the end of the year was €35.8 million (2012: €63.2 million) as planned construction activity and acquisitions were funded by a mix of debt and equity. In the year, the final US$60 million was drawn from the Standard Chartered and GE commitments. Total borrowing at the end of the year was €247.9 million (2012: €153.1 million) and Greenko currently has €205.6 million of committed but undrawn debt facilities in place. Post the year-end, the £100 million equity investment was received as expected from GIC.

Market Environment and Group Strategy

The macro environment within India continues to support Greenko. Over a third of India's population does not have access to power and the country's GDP growth is still estimated to be in excess of 5% per annum. Given the continued population and GDP growth, a wider electrification programme and growing urbanisation, the country's installed capacity is expected to reach 290 GW by 2017, from a current base of approximately 205 GW. Therefore, with fossil fuel's difficulty in delivering sufficient cost-effective power capacity, Greenko remains well positioned to become a leading Indian power producer.

Our projects benefit from long term power purchase agreements ("PPAs") that are not available to conventional power producers, thereby enhancing the security and long-term visibility of our revenue. Most of our projects are registered under the Clean Development Mechanism ("CDM") and provide the Group with Carbon Emission Reduction ("CER") revenue. As disclosed last year, we are selling CERs on a consistent basis and, while carbon revenue enhances project profitability, our project assessments continue the existing prudent approach of excluding it from the fundamental economic analysis.

There is a trend towards rising tariffs, supported by the Central Electricity Regulatory Commission guidelines. This is particularly beneficial in wind power, where zone classification and general industry practices are used as a benchmark, which complements Greenko's strategy of developing top-quartile projects. The Generation Based Incentive scheme, which provides an incremental incentive of INR 0.5/kWh was restarted in April 2013 for new projects and should benefit all the wind capacity we expect to commission this year. Recent tariff increases have meant our wind and hydro projects can operate profitably at or below grid parity. As a result, we are starting to develop PPAs with commercial off-takers, beginning with our 15 MW Matrix wind farm, which is expected to improve returns through a mix of higher prices and inflation linking.

Greenko's projects also have access to Renewable Energy Certificates ("RECs") where the generator sells the local component of electricity at market prices and trades the environmental attribute in the form of RECs separately through an established Power Exchange. REC revenue was €1.6 million in the year (2012: nil) from our two qualified projects. Although REC revenue is expected to be substantial in the next four to five years, based on the present renewable energy capacity shortfall, we are prudently limiting the number of projects exposed to the scheme until this new market's teething problems have been resolved.

Operational and Development review

Greenko reports on its capacity as: operating assets, projects in-construction and concessions under active development. Together, these represent approximately 2.34 GW. Behind this is a significant pipeline of potential development projects, which are only classified as 'active development' once the key concessions, resource assessment and agreements are in place. Overall, we have today:

·; Operational: 309.2 MW

·; Completed/being commissioned: 51.2 MW

·; Under-construction: 446.2 MW

·; Active development: 1,529.4 MW

We expect to have completed construction on over 200 MW before the end of March 2014, and started construction on a further 179.5 MW of projects.

Hydro

Greenko's hydro portfolio is made up of run-of-river projects, grouped in four clusters. The northern hydro portfolio has clusters in the states of Himachal Pradesh, Sikkim and Arunachal Pradesh. Our southern hydro portfolio has only one cluster, in Karnataka. The southern cluster is made up of relatively large projects on rivers that are primarily monsoon dependent. The northern hydro portfolio is all high-head projects that typically run for most of the year, due to hydrology based on snow melt, glacier melt and rainfall. Underpinning each cluster is a larger pipeline of active development project companies that are acquired once they have secured the key concessions, resource assessments and agreements.

During the year we added 61 MW of operating hydro assets in Himachal Pradesh and 425 MW of development assets in Himachal Pradesh and Arunachal Pradesh. Today, we are one of the largest operators of sub-100 MW hydro projects in India and will continue to add medium sized hydro projects to ensure portfolio risk is spread geographically and across technologies. The hydro portfolio now consists of 165.25 MW of operating assets and 187.6 MW under construction.

Greenko's hydro portfolio performed well, with an average Plant Load Factor ("PLF") of 34%. A very weak monsoon impacted the southern hydro projects, although the effect on the portfolio was offset by a strong performance from the northern hydro assets, which delivered an average PLF of 58% across the year, despite a number of projects still being in post-commissioning stabilisation. In the south, Jasper Power (Sonna) had a particularly poor year due to difficult rainfall patterns linked to its position on an irrigation canal.

The Himachal cluster has 11 operational run-of-river hydro projects totalling 71 MW and two projects, totalling 33.6 MW under construction. A new development concession (115 MW) consisting of two cascading hydro projects in the Chamba District is due to begin site work later this year. These are near our existing projects and located on a tributary of the Ravi River, which has good hydrology data and relatively easy site access.

Our largest hydro project under construction, Dikchu (96 MW) in Sikkim, remains on track for commissioning to start in late 2014-15. Key components of the project are progressing well, with the first Alsthom turbine and its associated balance of plant on-site, along with initial deliveries for the second turbine. Project debt of INR 5.2 billion is being provided by an IDBI led banking consortium.

The Karnataka cluster has five operational run-of-river hydro projects totalling 94.25 MW. There are three projects, totalling 58 MW, that are under construction and that should be commissioned in 2014-15, all with key contracts in place and site work underway.

The Arunachal Pradesh projects form a new regional cluster and consist of four cascading run-of-river hydro projects. Arunachal is one of India's most mountainous states and is substantially covered by the Himalayas. This region is one of the few areas remaining in India where large run-of-river projects are feasible, due to the steep topography and high quality hydrology. The projects are located on the perennial Yargyap Chu River (a tributary of the Tato River) in the West Siang District and have a catchment area of approximately 839 sq km. The sites are particularly attractive, as they have good road access, reliable power evacuation and relatively little need for tunnelling.

Overall, we believe run-of-river hydro is the most attractive power asset in India today. However, shareholders will only see the tangible delivery of our extensive work from next year, as projects start to commission. In the interim, we are continuing to assess several acquisition opportunities that are consistent with our strategy, although we will only proceed where an attractive return is achievable. In the next eighteen months, our wind portfolio will show the most tangible growth, as we expect to commission a substantial number of projects.

Wind

Our wind strategy is based on extensive analysis aimed at delivering a reliable long term generation profile, using validated wind data, robust project design and economic return hurdles. Execution is differentiated from the broader Indian wind energy market by focusing on utility scale projects that can be efficiently built in phases around core infrastructure. As previously announced, we have 934.0 MW of wind assets in active development, plus three 100+ MW utility scale wind power projects that are in varying stages of construction.

Shortly after the year-end, we signed a turbine supply and construction agreement with Gamesa to support the build out of our wind portfolio. This complements our existing GE turbine supply agreement, but provides useful technology diversification and reduces the risk of supply constraint delays. The agreement is for the Gamesa G97-2.0 MW IIIA turbine, with a binding obligation for 200 MW and an option for an additional 100 MW. The G97-2.0 is a specialised 2 MW low wind speed turbine, with a hub height of 90m and rotor diameter of 97m. The contract includes a two-year warranty, five years' operations and maintenance, a 100% power curve guarantee and attractive availability guarantees linked to the Indian wind season. This contract helps Greenko maintain its growth rate, while diversifying its technology and delivery risk. An initial order of 100 MW was placed and the first G97 equipment has arrived at Basvanbagewadi Phase-2 (50.0 MW). A second order is likely to be placed in the next few weeks, for delivery before the end of 2013.

Phase-1 of our Ratnagiri Wind Farm (65.6 MW) in Maharashtra has been commissioned. Phase-2 (36.0 MW) is on track to begin construction in late 2013 and the order for the enhanced GE 1.6 XLE turbine has now been placed. On past experience, the access roads are likely to require remediation after the monsoon, before we can reliably get the sixty-six 40.3m long blades to site. This remediation takes only a matter of weeks, but can only start once the monsoon ends.

Basvanbagewadi Wind Farm (145.2 MW) is our second major wind project in construction. This is in Karnataka and Phase-1 (51.2 MW) is fully completed using the GE 1.6 XLE turbine. The electrical sub-station is currently being tested and delays with the transmission line mean that power sales will only begin in August. However, approval for total power evacuation from the project was increased from 101.2 MW to 145.2 MW (158 MW including Matrix) and this capacity is included in the existing transmission line. Phase-2 (50.0 MW) will use the Gamesa G97-2.0 machine and should be commissioned in early 2014.

Our third major wind project is Balavenkatpuram2 Wind Farm (200.0 MW) in Andhra Pradesh. Phase-1 (57.6 MW) will use the enhanced GE 1.6 XLE turbine, with full commissioning expected around the end of the 2013 monsoon. Phase-2 (50.0 MW) will use the G97-2.0 turbine with commissioning in early 2014, and we are now moving Phase-3 (50.0 MW) into construction. Half the Phase-1 turbines are already up and the sub-station is two-thirds through construction. Approved capacity was recently increased to 200 MW and we are starting the land acquisition process for this additional capacity.

Our fourth wind project, Matrix Wind Farm (15.0 MW - Karnataka), effectively extends our Basvanbagewadi site, but sells its power directly to a multi-national IT Park via a 10-year PPA. The attractively priced ReGen 1.5 MW V87 turbine is being used and all the turbines are on site. Project commissioning is planned for the end of the 2013 wind season.

Current regulatory uncertainty in Rajasthan means we have delayed our Tanot-Jaisalmer (100 MW) and Devgarh (49.5 MW) projects until there is more clarity. Although we believe Rajasthan remains an attractive location, the strength of our development portfolio means we have the option to redeploy resources to more predictable near-term opportunities.

Thermal projects

The 36.8 MW LVS gas plant continued to generate operating profits under the contract's quasi-tolling structure in line with expectations. Our 58.4 MW Greenko Godavari gas plant remains delayed by the well-publicised uncertainty over output from the Reliance Krishna Godavari KG-D6 basin. As a result, we have moved the project to the tail end of our active development pipeline, in order to free-up management resources for projects with greater near term certainty. We may revisit these timings when there is more certainty over the gas supply, as construction is relatively swift.

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2Rayala Phase 1 to 4.

The Group's 41.5 MW of biomass assets continued to perform below long-term expectations, with individual operating PLFs ranging from 19.9% to 80.4%. Whilst biomass power offers stable generation, it does not offer the scope for growth that can be achieved with our hydro or wind assets. As such, we realised €1.2 million through the sale of an unused biomass project license and are currently evaluating all options to improve the return on capital from the existing operating assets.

Business Development

In addition to the 2.34 GW already secured, we have a large pipeline of potential opportunities. The Company's infrastructure, brand and standing within the industry provide it with unrivalled access to deal flow. Greenko will continue to pursue a dual strategy in hydro, assessing both potential acquisitions as well as new concession tenders. The Greenko team is currently analysing a number of assets, but will only take forward the most attractive opportunities. However, our growth plans are unchanged and continue to assume a preference for new concessions, particularly in the wind sector where our strategy is highly differentiated and focussed on maximising shareholders' returns through high quality resource data and utility scale assets.

First quarter 2013-14 performance

In the first three months of our new financial year the overall portfolio performed marginally ahead of management expectations. Northern hydro achieved 89% of its budget, as a relatively harsh winter delayed the initial snowmelt, with approximately 110.9 GWh generated. However, generation in June was ahead of budget, as snowmelt picked up and the monsoon arrived early. Southern hydro generated 118% of budget (18.8 GWh), due to technical improvements at AMR and Rithwick that increased the projects' net head, and the early monsoon. Ratnagiri Phase-1 achieved good performance, with 25.8 GWh generated, or 132% of expectations, helped by the early monsoon. Total thermal generation was equivalent to 79.6 GWh, which was in-line with management expectations, net of various planned shutdowns.

While we cannot control wind or water flows, having the plant available to run when the resource is available is critical. In the first quarter, northern hydro achieved 99.8% availability and southern hydro 99.9%. This means southern generating capacity was only unavailable for less than two hours over a three-month period. This was exceptionally good performance by the northern and southern hydro assets, and a testament to the teams running those projects.

Outlook

The backdrop for power in India remains positive, as conventional power assets are struggling to supply power to the grid, due to fuel supply and off-take price issues. The grid parity achievement of the Group's wind and hydro portfolio, coupled with increased demand, means that Greenko is well positioned to provide financially attractive returns.

The Group enjoyed a successful twelve months in which we secured the finance to deliver our strategy and a significantly larger development pipeline. Commissioning Ratnagiri was an important milestone, as wind power will accelerate our growth and create a diversified generating portfolio that delivers strong returns to shareholders. We are pleased with progress at our projects under construction, as these underpin the significant growth we plan to deliver this year.

We strongly believe that Greenko's diversified portfolio of projects, both operating and under active development, is the most attractive long-term power asset in the Indian market. We are on track to meet our 2015 target of 1,000 MW and there are considerable further opportunities to profitably grow our business beyond that.

Anil Chalamalasetty

CEO and Managing Director

Consolidated statement of financial position as at 31 March 2013

The notes are an integral part of these consolidated financial statements.

Consolidated statement of comprehensive income for the year ended 31 March 2013

The notes are an integral part of these consolidated financial statements.

Consolidated statement of changes in equity (Audited)

The notes are an integral part of these consolidated financial statements.

Consolidated statement of changes in equity (continued) (Unaudited)

The notes are an integral part of these consolidated financial statements.

Consolidated statement of cash flowfor the year ended 31 March 2013

The notes are an integral part of these consolidated financial statements

Notes to the consolidated financial statements

1. General information

Greenko Group plc ("the Company" or "the Parent") is a company domiciled in the Isle of Man and registered as a company limited by shares under company number 001805V pursuant to the provisions of Part XI of the Isle of Man Companies Act 2006. The registered office of the Company is at 4th floor, 14 Athol Street, Douglas, Isle of Man, IM1 1JA. The Company is listed on the Alternative Investment Market ("AIM") of the London Stock Exchange.

The Company together with its subsidiaries ("the Group") is in the business of owning and operating clean energy facilities in India. All the energy generated from these plants is sold to state utilities and other electricity transmission and trading companies in India through long-term power purchase agreements ("PPA"). The Group holds licence to trade up to 100 million units of electricity per annum in the whole of India except the state of Jammu and Kashmir. However, the Group is yet to commence trading in electricity. The Group is also a part of the Clean Development Mechanism ("CDM") process and generates and sells Certified Emission Reductions ("CER"), Voluntary Emission Reductions ("VER") and Renewable Energy Certificates ("REC").

2. Summary of significant accounting policies

The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the periods presented.

2.1 Basis of preparation

The consolidated financial statements of Greenko Group plc have been prepared in accordance with the International Financial Reporting Standards ("IFRS") as adopted by the European Union. The consolidated financial statements have been prepared under the historical cost convention, as modified by the revaluation of available-for-sale financial assets, and financial assets and financial liabilities (including derivative instruments) at fair value through profit or loss.

The preparation of financial information in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying the Group's accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the consolidated financial information are disclosed in the critical accounting estimates and judgments section (note 5).

2.2 Consolidation

The consolidated financial statements include the assets, liabilities and results of the operations of the parent company and its subsidiaries. Subsidiaries are all entities over which the Group has the power to govern the financial and operating policies so as to obtain economic benefits from its activities, generally accompanying a shareholding of more than one half of the voting rights. The Group considers the existence and effect of potential voting rights that are presently exercisable or convertible in determining control. Subsidiaries are consolidated from the date on which the Group acquires effective control. Consolidation is discontinued from the date when control over the subsidiary ceases.

The acquisition method of accounting is used to account for the acquisition of subsidiaries by the Group. The cost of an acquisition is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date, irrespective of the extent of any non-controlling interest. The excess of the cost of acquisition over the fair value of the Group's share of the identifiable net assets acquired is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognised directly in profit or loss. Acquisition related costs are expensed as incurred.

Previously held identifiable assets, liabilities and contingent liabilities of the acquired entity are revalued to their fair value at the date of acquisition, being the date at which the Group achieves control of the acquired entity. The movement in fair value is recognized in profit or loss.

All intra-group transactions, balances and unrealised gains on intra-group transactions are eliminated. Unrealised losses are also eliminated but considered an impairment indicator of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

Non-controlling interests represent the portion of profit or loss and net assets that is not held by the Group and are presented separately in the consolidated statement of comprehensive income and within equity in the consolidated statement of financial position, separately from parent shareholders' equity.

Acquisitions of an additional stake or dilution of a stake from/ to non-controlling interests in the Group are accounted for using the equity method, whereby, the difference between the consideration paid or received and the book value of the share of the net assets is recognised in 'other reserve' within the statement of changes in equity. The Group attributes total comprehensive income of subsidiaries between the owners of the Parent and the non-controlling interests based on their respective ownership interests.

2.3 Segment reporting

The Group's operations predominantly relate to generation and sale of electricity. The chief operating decision maker evaluates the Group's performance and allocates resources based on an analysis of various performance indicators at operating segment level. Accordingly, there is only a single operating segment "generation and sale of electricity, related emission reductions and renewable energy certificates".

2.4 Foreign currency translation

a) Functional and presentation currency

Items included in the financial statements in each of the Group's entities are measured using the currency of the primary economic environment in which the entity operates ("the functional currency"). The consolidated financial statements are presented in 'Euro' ("€"), which is the Company's functional and presentation currency. The functional currency of the Group's subsidiaries in India is Indian Rupees ("INR").

b) Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the date of the transaction. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss.

c) Group companies

The results and financial position of all the Group entities (none of which has the currency of a hyper-inflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

·; assets and liabilities presented for each reporting date are translated at the closing rate at the reporting date;

·; income and expenses for each statement of comprehensive income are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rate on the dates of the transactions); and

·; resulting exchange differences are charged/ credited to other comprehensive income and recognised in the currency translation reserve within equity.

When a foreign operation is partially disposed of or sold, exchange differences that were recorded as other comprehensive income are recognised in profit or loss as part of the gain or loss on sale.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the closing rate.

2.5 Property, plant and equipment

Property, plant and equipment is stated at historical cost less accumulated depreciation and any impairment in value. Freehold land is not depreciated. Historical cost includes expenditure that is directly attributable to the acquisition of the items and borrowing cost. Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with them will flow to the Group and the cost of the item can be measured reliably. All other repairs and maintenance expenditure are charged to profit or loss during the period in which they are incurred. Depreciation is calculated on a straight-line basis over the estimated useful life of the asset as follows:

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefit is expected to arise from the continued use of the asset. Any gain or loss arising on de-recognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the item) is recognised in profit or loss in the period the item is derecognised.

2.6 Intangible assets

a) Goodwill

Goodwill represents the future economic benefits arising from a business combination that are not individually identified and separately recognised. Goodwill represents the excess of the cost of an acquisition over the fair value of the Group's share of the net identifiable assets of the acquired subsidiary at the date of acquisition. Goodwill on acquisition of subsidiaries is included in intangible assets. Goodwill is tested annually for impairment and carried at cost less accumulated impairment losses. Impairment losses on goodwill are not reversed. Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold. Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to those cash-generating units or groups of cash-generating units that are expected to benefit from the business combination in which the goodwill arose.

b) Other intangibles

Intangible assets acquired individually, with a group of other assets or in a business combination are carried at cost less accumulated amortization and any impairment in value. The intangible assets are amortised over their estimated useful lives in proportion to the economic benefits consumed in each period. The estimated useful lives of the intangible assets are as follows:

Amortisation of intangible assets is included within 'Depreciation and amortisation'.

2.7 Impairment of non-financial assets

Assets that have an indefinite useful life, for example goodwill, are not subject to amortization and are tested annually for impairment. Assets that are subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units). Non-financial assets other than goodwill that suffered impairment are reviewed for possible reversal of the impairment at each reporting date.

2.8 Financial assets

The Group classifies its financial assets in the following categories: loans and receivables, and available for sale. The classification depends on the purpose for which the financial asset was acquired. Management determines the classification of its financial assets at initial recognition.

a) Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for maturities greater than 12 months after the reporting date. These are classified as non-current assets. The Group's loans and receivables comprise trade and other receivables, investment in bank deposits and cash and cash equivalents in the statement of financial position (notes 2.12, 2.13 and 2.14). Loans and receivables are initially recognised at fair value plus transaction costs. Loans and receivables are carried at amortised cost using the effective interest method.

b) Available-for-sale financial assets

Available-for-sale financial assets are non-derivatives that are either designated in this category or not classified in any of the other categories. They are included in non-current assets unless management intends to dispose of the investment within 12 months of the reporting date.

Changes in the fair value of monetary and non-monetary securities classified as available-for-sale are recognised in other comprehensive income. When securities classified as available-for-sale are sold or impaired, the accumulated fair value adjustments recognised as other comprehensive income are included in the profit or loss as 'gains and losses from investment securities'. Dividends on available-for-sale mutual fund units are recognised in the profit or loss as a part of other income.

Regular purchases and sales of financial assets are recognised on the trade-date - the date on which the Group commits to purchase or sell the asset. Investments are initially recognised at fair value plus transaction costs for all financial assets not carried at fair value through profit or loss. Financial assets are derecognised when the rights to receive cash flows from the investments have expired or have been transferred and the Group has transferred substantially all risks and rewards of ownership. Available-for-sale financial assets are subsequently carried at fair value.

The fair value of the mutual fund units is based on the net asset value publicly made available by the respective mutual fund managers.

The Group assesses at each reporting date whether there is objective evidence that a financial asset or a group of financial assets is impaired. Impairment testing of trade receivables is described in note 2.12.

The Group derecognises financial assets when it transfers substantially all the risks and rewards of ownership of the financial asset. On de-recognition of a financial asset the difference between the carrying amount and the consideration received is recognised in profit or loss.

2.9 Options with non-controlling interests in subsidiaries

The Group has entered into put and call options over certain non-controlling interests in subsidiaries. The option exercise price is fixed and the options are exercisable within a fixed timeframe. The potential cash payments related to options issued by the Group over the equity of subsidiary companies are accounted for as financial liabilities at the present value of the redemption in line with the requirements of IAS 32 and 39. The amount that may become payable under the option on exercise is initially recognised at fair value with a corresponding debit to 'Option Reserve' under equity. Such financial liabilities are subsequently measured at amortized cost, using the effective interest rate method.

2.10 Derivative financial instruments

a) Forward contracts

The Group purchases foreign exchange forward contracts to mitigate the risk of changes in foreign exchange rates associated with its loans denominated in US dollars. These derivative contracts do not qualify for hedge accounting under IAS 39, and are initially recognised at fair value on the date the contract is entered into and subsequently re-measured at their fair value. Gains or losses arising from changes in the fair value of the derivative contracts are recognised in profit or loss.

b) Sale commitments

IAS 39 requires contracts to buy or sell non-financial items to be treated as derivatives and accordingly fair valued on the reporting date, unless the contracts qualify for the 'own use' exemption. The Group qualifies for the limited 'own use' exemption from derivative accounting on the basis that its emission reduction purchase and sale commitments are entered into and continue to be held for the purpose of the receipt or delivery of emission reductions in accordance with the Group's expected purchase and sale requirements. Own use contracts are outside the scope of IAS 39 and are therefore accounted for as executory contracts.

2.11 Inventories

a) Raw material, stores and consumables

Inventories of raw material, stores and consumables are valued at the lower of cost and net realisable value. Cost includes expenses incurred in bringing each product to its present location and condition and is determined on a weighted average basis. Net realisable value is the estimated selling price in the ordinary course of business less any applicable selling expenses.

b) Emission Reductions ("ER") and Renewable Energy Certificates ("REC")

Inventories of ER and REC are stated at the lower of cost or net realisable value. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and selling expenses. ER are generated and held for sale in the ordinary course of business. Electricity and ERs/RECs are treated as joint products, as they are generated simultaneously. Cost of generation is allocated in the ratio of relative net sale value of the products. Cost comprises all production, acquisition and conversion costs and is aggregated on a weighted average basis. To the extent that any impairment arises, losses are recognised in the period they occur. The costs associated with generating inventories are charged to the profit or loss in the same period as the related revenues are recognised.

2.12 Trade and other receivables

Trade receivables are recognized initially at fair value. They are subsequently measured at amortised cost using the effective interest method, net of provision for impairment, if the effect of discounting is considered material. The carrying amounts, net of provision for impairment, reported in the statement of financial position approximate the fair value due to their short realisation period. A provision for impairment of trade receivables is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of receivables. The provision is measured as the difference between the asset's carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the receivables' original effective interest rate. The amount of the provision is recognized in the profit or loss.

2.13 Investment in bank deposits

Investments in bank deposits represent term deposits placed with banks earning a fixed rate of interest. Investments in bank deposits with maturities of less than a year are disclosed as current assets and more than one year as non-current assets. At the reporting date, these deposits are measured at amortised cost using the effective interest method. Cash and cash equivalents which are pledged with the banks for availing short term loans are classified as part of investment in bank deposits.

2.14 Cash and cash equivalents

Cash and cash equivalents include cash in hand and at bank, and short-term deposits with an original maturity period of three months or less. Bank overdrafts that are an integral part of cash management and where there is a legal right of set-off against positive cash balances are included in cash and cash equivalents. Otherwise bank overdrafts are classified as borrowings.

2.15 Share capital

Ordinary shares are classified as equity and represent the nominal value of shares that have been issued.

Share premium includes any premiums received on the issue of ordinary shares. Any transaction costs associated with the issuing of shares are deducted from share premium, net of any related income tax benefits.

Share-based payment reserve represent fair value of employee services received in consideration for the equity instruments (options) of the Group.

The revaluation reserve within equity comprises gains and losses due to the revaluation of intangible assets.

Foreign currency translation differences arising on the translation of the Group's foreign entities are included in the translation reserve.

Other reserves include all other transaction with the owners in their capacity as owners, impact of changes in the ownership interest in subsidiaries that do not result in loss of control and government grants accounted under capital approach.

Option reserve represents fair value of non-controlling interests put on initial recognition.

Retained earnings include all current and prior period retained profits.

All transactions with owners of the Parent are recorded separately within equity.

2.16 Trade payables

Trade payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, if the effect of discounting is considered material.

2.17 Borrowings

Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in profit or loss over the period of the borrowings using the effective interest method.

The fair value of the liability portion of a non-convertible bond with detachable warrants is determined using a market interest rate for an equivalent non-convertible bond without detachable warrants. This amount is recorded as a liability on an amortised cost basis until extinguished on maturity of the bonds. The remainder of the proceeds is allocated to the warrants. This is recognised in shareholders' equity.

Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the reporting date.

2.18 Current and deferred income tax

Tax expense recognised in profit or loss comprises the sum of deferred tax and current tax not recognised in other comprehensive income or directly in equity.

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the reporting date in the countries where the Company's subsidiaries operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit/loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantively enacted by the reporting date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.

Deferred income tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised.

Deferred income tax is provided on temporary differences arising on investments in subsidiaries, except where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future.

2.19 Employee benefits

Wages, salaries, bonuses, social security contributions, paid annual leave and sick leave are accrued in the period in which the associated services are rendered by employees of the Group. The Group operates two retirement benefit plans.

a) Gratuity plan

The Gratuity Plan is a defined benefit plan that, at retirement or termination of employment, provides eligible employees with a lump sum payment, which is a function of the last drawn salary and completed years of service. The liability recognised in the statement of financial position in respect of the gratuity plan is the present value of the defined benefit obligation at the reporting date less the fair value of plan assets, if any, together with adjustments for unrecognised past-service costs. The defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest rates of Government of India securities that have terms to maturity approximating to the terms of the related gratuity liability.

Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are charged or credited to the profit or loss in the period in which they arise.

b) State administered Provident Fund

Under Indian law, employees are entitled to receive benefits under the Provident Fund, which is a defined contribution plan. Both the employee and the employer make monthly contributions to the plan at a predetermined rate (currently 12.0 per cent.) of the employees' basic salary. The Group has no further obligation under the Provident Fund beyond its contribution, which is expensed when accrued.

c) Share-based compensation

The Group operates an equity-settled, share-based compensation plan, under which the entity receives services from employees as consideration for equity instruments (options) of the Group. The fair value of the employee services received in exchange for the grant of the options is recognised as an expense. The total amount to be expensed is determined by reference to the fair value of the options granted, including the impact of market conditions. Non-market vesting conditions are included in assumptions about the number of options that are expected to vest. The total amount expensed is recognised on a graded vesting basis over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied. At each reporting date, the entity revises its estimates of the number of options that are expected to vest based on the non-market vesting conditions. It recognises the impact of the revision to original estimates, if any, in profit or loss, with a corresponding adjustment to equity. If the terms of an equity-settled award are modified, at a minimum an expense is recognised as if the terms had not been modified. An additional expense is recognised for any modification that increases the total fair value of the share-based payment arrangement, or is otherwise beneficial to the employee, as measured at the date of modification.

The proceeds received net of any directly attributable transaction costs are credited to share capital (nominal value) and share premium when the options are exercised.

2.20 Provisions

Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. Where the Group expects some or all of a provision to be reimbursed, for example under an insurance contract, the reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain. The expense relating to any provision is presented in the statement of comprehensive income net of any reimbursement. If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability. Where discounting is used, the increase in the provision due to the passage of time is recognised as other finance expense.

2.21 Revenue recognition

a) Sale of electricity

Revenue from the sale of electricity is recognised on the basis of the number of units of power exported in accordance with joint meter readings undertaken on a monthly basis by representatives of the buyer and the Group at the rates prevailing on the date of export as determined by the power purchase agreement.

b) Sale of emission reductions

Revenue from sale of CER is recognized after registration of the project with United Nations Framework Convention on Climate Change (UNFCCC), generation of emission reductions, execution of a firm contract of sale and billing to a customer.

VER are emission reductions achieved by the power generation plants before the effective date of registration by the UNFCCC. The quantity of the VER is based on the estimation of the management, verification by an independent assessor and subject to the satisfaction of the buyer. Revenue is recognized upon execution of a firm contract of sale and on billed VER to the customers.

c) Sale of REC

Revenue from sale of RECs is recognized after registration of the project with central and state government authorities, generation of power and execution of a contract for sale through Indian Energy Exchange (IEX).

d) Interest income

Interest income is recognised as the interest accrues to the net carrying amount of the financial asset using the net effective interest rate method.

2.22 Leases

Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to the profit or loss on a straight-line basis over the period of the lease.

2.23 Government grants

Grants from the government are recognised at their fair value where there is a reasonable assurance that the grant will be received and the Group will comply with all attached conditions. The Group follows the capital approach under which a grant is credited directly to equity when the grants received by the Group represent incentives provided by government, unrelated to costs, to promote power generation based on certain renewable energy sources.

Other government grants are recognised as income over the period necessary to match them with the costs for which they are intended to compensate, on a systematic basis. Government grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the Company with no future related costs are recognised in profit or loss in the period in which they become receivable.

2.24 Borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset are capitalised during the period of time that is necessary to complete and prepare the asset for its intended use or sale. Other borrowing costs are expensed in the period in which they are incurred and reported in finance costs.

3. New standards and interpretations not yet adopted

At the date of authorisation of these financial statements, certain new standards, amendments and interpretations to existing standards have been published by the International Accounting Standards Board ("IASB") but are not yet effective, and have not been adopted early by the Group.

Management anticipates that all of the relevant pronouncements will be adopted in the Group's accounting policies for the first period beginning after the effective date of the pronouncement. Information on new standards, amendments and interpretations that are expected to be relevant to the Group's financial statements is provided below. Certain other new standards and interpretations have been issued but are not expected to have a material impact on the Group's financial statements.

IFRS 9 'Financial Instruments' (IFRS 9)

The IASB aims to replace International Accounting Standard ("IAS") 39 Financial Instruments: Recognition and Measurement in its entirety. IFRS 9 is being issued in phases. To date, the chapters dealing with recognition, classification, measurement and de-recognition of financial assets and liabilities have been issued. These chapters are effective for annual periods beginning 1 January 2015. Chapters dealing with impairment methodology and hedge accounting are still being developed.

Further, in November 2011, the IASB tentatively decided to consider making limited modifications to IFRS 9's financial asset classification model to address application issues. The Group's management have yet to assess the impact of this new standard on the Group's consolidated financial statements. However, the management does not expect to implement IFRS 9 until all of its chapters have been published and they can comprehensively assess the impact of all changes.

Consolidation Standards

A package of new consolidation standards is effective for annual periods beginning or after 1 January 2013. Information on these new standards is presented below. Management is in the process of its assessment of the impact of these new and revised standards on the Group's consolidated financial statements.

IFRS 10 'Consolidated Financial Statements' (IFRS 10)

IFRS 10 supersedes IAS 27 'Consolidated and Separate Financial Statements' (IAS 27) and SIC 12 'Consolidation - Special Purpose Entities'. IFRS 10 revises the definition of control and provides extensive new guidance on its application. These new requirements have the potential to affect which of the Group's investees are considered to be subsidiaries and therefore change the scope of consolidation. However, the requirements on consolidation procedures, accounting for changes in non-controlling interests and accounting for loss of control of a subsidiary remain the same. Management's provisional analysis is that IFRS 10 will not change the classification (as subsidiaries or otherwise) of any of the Group's existing investees at 31 March 2013.

IFRS 11 'Joint Arrangements' (IFRS 11)

IFRS 11 supersedes IAS 31 'Interests in Joint Ventures' (IAS 31). It aligns more closely the accounting by the investors with their rights and obligations relating to the joint arrangement. In addition, IAS 31's option of using proportionate consolidation for joint ventures has been eliminated. IFRS 11 now requires the use of the equity accounting method, which is currently used for investments in associates. As at 31 March 2013 the Group's does not have any joint arrangement within the scope of IFRS 11.

IFRS 12 'Disclosure of Interests in Other Entities' (IFRS 12)

IFRS 12 integrates and makes consistent the disclosure requirements for various types of investments, including unconsolidated structured entities. It introduces new disclosure requirements about the risks to which an entity is exposed from its involvement with structured entities.

Transition guidance for IFRS 10, 11, 12

Subsequent to issuing the new standards the IASB made some changes to the transitional provisions in IFRS 10, IFRS 11 and IFRS 12. The guidance confirms that the entity is not required to apply IFRS 10 retrospectively in certain circumstances and clarifies the requirements to present adjusted comparatives. The guidance also makes changes to IFRS 11 and IFRS 12 which provide similar relief from the presentation or adjustment of comparative information for periods prior to the immediately preceding period. Further, it provides additional relief by removing the requirement to present comparatives for the disclosures relating to unconsolidated structured entities for any period before the first annual period for which IFRS 12 is applied.

The new guidance is also effective for annual periods on or after 1 January 2013.

Consequential amendments to IAS 27 'Separate Financial Statements' (IAS 27) and IAS 28 'Investments in Associates and Joint Ventures' (IAS 28)

IAS 27 now only addresses separate financial statements. IAS 28 brings investments in joint ventures into its scope. However, IAS 28's equity accounting methodology remains unchanged.

IFRS 13 'Fair Value Measurement' (IFRS 13)

IFRS 13 clarifies the definition of fair value and provides related guidance and enhanced disclosures about fair value measurements. It does not affect which items are required to be fair-valued. IFRS 13 applies prospectively for annual periods beginning on or after 1 January 2013. Management is in the process of reviewing its valuation methodologies for conformity with the new requirements and its assessment of their impact on the Group's consolidated financial statements.

Amendments to IAS 1 'Presentation of Financial Statements' (IAS 1 Amendments)

The IAS 1 Amendments require an entity to group items presented in other comprehensive income into those that, in accordance with other IFRS: (a) will not be reclassified subsequently to profit or loss and (b) will be reclassified subsequently to profit or loss when specific conditions are met. It is applicable for annual periods beginning on or after 1 July 2012. The Group's management expects this will change the current presentation of items in other comprehensive income; however, it will not affect the measurement or recognition of such items.

Amendments to IAS 19 'Employee Benefit's (IAS 19 Amendments)

The IAS 19 Amendments include a number of targeted improvements throughout the Standard. The main changes relate to defined benefit plans. They:

• eliminate the 'corridor method', requiring entities to recognise all gains and losses arising in the reporting period

• streamline the presentation of changes in plan assets and liabilities

• enhance the disclosure requirements, including information about the characteristics of defined benefit plans and the risks that entities are exposed to through participation in them.

The amended version of IAS 19 is effective for financial years beginning on or after 1 January 2013. The management does not expect the application of this revised standard to have any material impact on its financial statements when it becomes effective.

Offsetting Financial Assets and Financial Liabilities (Amendments to IAS 32)

The Amendments to IAS 32 add application guidance to address inconsistencies in applying IAS 32's criteria for offsetting financial assets and financial liabilities in the following two areas:

• the meaning of 'currently has a legally enforceable right of set-off'

• that some gross settlement systems may be considered equivalent to net settlement.

The Amendments are effective for annual periods beginning on or after 1 January 2014 and are required to be applied retrospectively. Management does not anticipate a material impact on the Group's consolidated financial statements from these Amendments.

Disclosures - Offsetting Financial Assets and Financial Liabilities (Amendments to IFRS 7)

Qualitative and quantitative disclosures have been added to IFRS 7 'Financial Instruments: Disclosures' (IFRS 7) relating to gross and net amounts of recognised financial instruments that are (a) set off in the statement of financial position and (b) subject to enforceable master netting arrangements and similar agreements, even if not set off in the statement of financial position. The Amendments are effective for annual reporting periods beginning on or after 1 January 2013 and interim periods within those annual periods. The required disclosures should be provided retrospectively. Management does not anticipate a material impact on the Group's consolidated financial statements from these Amendments.

Annual Improvements 2009-2011 (the Annual Improvements)

The Annual Improvements 2009-2011 (the Annual Improvements) made several minor amendments to a number of IFRSs. The amendments relevant to the Group are summarised below:

Clarification of the requirements for opening statement of financial position:

• clarifies that the appropriate date for the opening statement of financial position is the beginning of the preceding period (related notes are no longer required to be presented)

• addresses comparative requirements for the opening statement of financial position when an entity changes accounting policies or makes retrospective restatements or reclassifications, in accordance with IAS 8.

Clarification of the requirements for comparative information provided beyond minimum requirements:

• clarifies that additional financial statement information need not be presented in the form of a complete set of financial statements for periods beyond the minimum requirements

• requires that any additional information presented should be presented in accordance with IFRS and the entity should present comparative information in the related notes for that additional information.

Tax effect of distribution to holders of equity instruments:

• addresses a perceived inconsistency between IAS 12 'Income Taxes' (IAS 12) and IAS 32 'Financial Instruments: Presentation' (IAS 32) with regards to recognising the consequences of income tax relating to distributions to holders of an equity instrument and to transaction costs of an equity transaction

• clarifies that the intention of IAS 32 is to follow the requirements in IAS 12 for accounting for income tax relating to distributions to holders of an equity instrument and to transaction costs of an equity transaction.

Segment information for total assets and liabilities:

• clarifies that the total assets and liabilities for a particular reportable segment are required to be disclosed if, and only if: (i) a measure of total assets or of total liabilities (or both) is regularly provided to the chief operating decision maker; (ii) there has been a material change from those measures disclosed in the last annual financial statements for that reportable segment.

The Annual Improvements noted above are effective for annual periods beginning on or after 1 January 2013. Management does not anticipate a material impact on the Group's consolidated financial statements from these Amendments.

4. Financial risk management

4.1. Financial risk factors

The Group's activities expose it to a variety of financial risks; market risk, credit risk and liquidity risk. The Group's overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group's financial performance. The financial instruments of the Group, other than derivatives, comprise loans from banks and financial institutions, non-convertible bonds, demand deposits, short-term bank deposits, trade and other receivables, available for sale investments, trade and other payables.

4.1.1 Market risk

Market risk is the risk that the fair values of future cash flows of a financial instrument will fluctuate because of volatility of prices in the financial markets. Market risk can be further segregated as: a) Foreign exchange risk and b) Interest rate risk

a) Foreign exchange risk

Foreign exchange risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Group has made borrowings denominated in US dollar ("$") in respect of which it is exposed to foreign currency exchange risk.

If the € had weakened or strengthened by 0.50% against the $, with all other variables held constant, Property, plant and equipment for the year ended 31 March 2013 would have been lower or higher by €273,105 as a result of foreign exchange gains or losses on translation of the $ denominated borrowings.

The sensitivity analysis is based on a reasonably possible change in the underlying foreign currencies computed from historical data.

b) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. As the Group has no significant interest-bearing assets other than investment in bank deposits, the Group's income and operating cash flows are substantially independent of changes in market interest rates. The Company considers the impact of fair value interest rate risk on investment in bank deposits as not material. The Group's interest rate risk arises from long-term borrowings. Borrowings issued at variable rates expose the Group to cash flow interest rate risk. Borrowings issued at fixed rates expose the Group to fair value interest rate risk. During the year, the Group's borrowings at variable rate were largely denominated in the functional currency of its Indian entities, being INR, although two loans were denominated in $.

If interest rates on borrowings had been 50 basis points higher or lower with all other variables held constant, post-tax profit for the year would have been lower or higher by €544,358 mainly as a result of the higher or lower interest expense on long term floating rate borrowings.

The sensitivity analysis is based on a reasonably possible change in the market interest rates computed from historical data.

4.1.2 Credit risk

Credit risk is the risk that a counter-party will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Group's credit risk arises from accounts receivable balances on sale of electricity, CER and REC. In respect of trade and other receivables, the Group is not exposed to any significant credit risk exposure to any single counterparty or any group of counterparties having similar characteristics. The Indian entities have entered into PPA with transmission companies incorporated by the Indian State Governments and other electricity transmission and trading companies to export the electricity generated. The Group is therefore committed to sell power to these customers and regards any potential risk of default as being predominantly a governmental one. The Group is paid monthly by the transmission companies for the electricity it supplies. The CER are sold under contractual emission reduction purchase agreements ("ERPA") concluded with the purchaser of the CER. The Group assesses the credit quality of the purchaser based on its financial position and other information.

The Group maintains banking relationships with only creditworthy banks which it reviews on an on-going basis. The Group enters into derivative financial instruments where the counter-party is generally a bank. Consequently, the credit risk on the derivatives and bank deposits is not considered material.

4.1.3 Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash and cash equivalents and maintaining adequate credit facilities.

The Group intends to be acquisitive in the immediate future. In respect of its existing operations, the Group funds its activities primarily through long-term loans secured against each power plant. In addition, each of the operating plants has working capital loans available to it which are renewable annually, together with certain intra-group loans. The Group's objective in relation to its existing operating business is to maintain sufficient funding to allow the plants to operate at an optimal level and in particular purchase the necessary raw materials required.

In respect of each acquisition, the Group prepares a model to evaluate the necessary funding required. The Group's strategy is to primarily fund such acquisitions by assuming debt in the acquired companies or by borrowing specific long-term funds secured on the power plant to be acquired. In relation to the payment towards equity component of companies to be acquired, the Group ordinarily seeks to fund this by the injection of external funds by debt or equity.

The Group has identified a large range of acquisition opportunities which it is continually evaluating and which are subject to constant change. In respect of its overall business the Group therefore does not, at the current time, maintain any overall liquidity forecasts. The table below analyses the Group's financial liabilities into relevant maturity groupings based on the remaining period at the reporting date to the contractual maturity date. The Group manages its liquidity needs by monitoring scheduled debt servicing payments for long-term financial liabilities and the data used for analysing these cash flows is consistent with that used in the contractual maturity analysis below.

The amounts disclosed in the table are the contractual undiscounted cash flows.

4.1.4 Capital risk management

The Group's objective when managing capital is to safeguard the Group's ability to continue as a going concern in order to provide returns for shareholders and benefits for stakeholders. The Group also proposes to maintain an optimal capital structure to reduce the cost of capital. Hence, the Group may adjust any dividend payments, return capital to shareholders or issue new shares. Total capital is the equity as shown in the consolidated statement of financial position. Currently, the Group primarily monitors its capital structure in terms of evaluating the funding of potential acquisitions. Management is continuously evolving strategies to optimize the returns and reduce the risks. It includes plans to optimize the financial leverage of the Group.

The capital for the reporting year under review is summarised as follows:

4.1.5 Fair value estimation

The fair value of financial instruments that are not traded in an active market (for example, forward contracts) is determined by using valuation techniques. The Group uses its judgment to determine an appropriate method and make assumptions that are based on market conditions existing at each reporting date. The fair value of forward foreign exchange contracts is determined using quoted forward exchange rates at the reporting date.

The carrying value less impairment provision of trade receivables and payables are assumed to approximate their fair values due to the short-term nature. The fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at the current market interest rate that is available to the Group for similar financial instruments.

5. Critical accounting estimates and judgements

The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial information and the reported amounts of revenue and expenses during the reporting period. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily available from other sources.

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

a) Income taxes

The Group is subject to income taxes in a number of jurisdictions. Significant judgment is required in determining provision for income taxes. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The Group recognises liabilities for anticipated tax issues based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made.

b) Estimated impairment of goodwill

In accordance with the accounting policy stated in note 2.6, the Group tests annually whether goodwill has suffered any impairment. The recoverable amounts of cash-generating units have been determined based on value-in-use calculations. These calculations require the use of estimates including future operating margins and discount rates (note 7). No impairment charge was accounted during the year.

c) Application of business combination accounting rules, including identification of intangible assets acquired in a business combination

The Group allocates the purchase price of the acquired companies towards the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values. The Group engages third-party external appraisal firms to assist in determining the fair values of the acquired assets and liabilities. Such valuation requires the Group to make significant estimate and assumptions, especially with respect to identification and valuation of intangible assets.

d) Useful life of depreciable assets

Management reviews the useful life of depreciable assets at each reporting date, based on the expected utility of the assets to the Group. The carrying amounts are analysed in note 8. Actual results, however, may vary due to technical obsolescence, particularly relating to software and IT equipment.

e) Application of lease accounting rules

Significant judgment is required to apply lease accounting rules under IFRIC 4 Determining whether an Arrangement contains a Lease and IAS 17 Leases. In assessing the applicability to arrangements entered into by the Group management has exercised judgment to evaluate customer's right to use the underlying assets, substance of the transaction including legally enforced arrangements and other significant terms and conditions of the arrangement to conclude whether the arrangements meet the criteria under IFRIC 4.

f) Application of interpretation for service concession arrangements

Management has assessed applicability of IFRIC 12: Service Concession arrangements for certain arrangements that are part of business combinations acquired during the year. In assessing the applicability the management has exercised significant judgement in relation to the underlying ownership of the assets, the ability to enter into power purchase arrangements with any customer, ability to determine prices etc in concluding that the arrangements don't meet the criteria for recognition as service concession arrangements.

g) Classification of financial instruments as equity or liability

Significant judgment is required to apply the rules under IAS 32: Financial Instruments: Presentation and IAS 39: Financial Instruments: Recognition and Measurement to assess whether an instrument is equity or a financial liability. The management has exercised significant judgment to evaluate the terms and conditions of certain financial instruments with reference to the applicability of contingent settlement provisions, evaluation of whether options under the contract will be derivative or a non-derivative, assessing if certain settlement terms are within the control of the Company and if not whether the occurrence of these events are extremely rare, highly abnormal and very unlikely, clarifications between the parties to the agreement subsequent to the date of the agreement etc to conclude that the instruments be classified as an equity or liability instrument.

6. -Interest in subsidiaries

Set out below are the Group's subsidiaries at 31 March 2013. Unless otherwise stated, the subsidiaries as listed below have share capital consisting solely of ordinary shares, which are held directly by the Group and the proportion of ownership interests held equals to the voting rights held by Group. The country of incorporation or registration is also their principal place of business.

* The beneficial and economic interest of the Group is 100% due to agreement with the other shareholders.

# Entities has preferential shares in additions to ordinary shares.

7. Intangible assets

Amortization and impairment charges are included under 'Depreciation and amortization' in the statement of comprehensive income. The average remaining amortization period for licences is 27.6 years and for electricity PPA is 3.6 years.

Impairment tests for goodwill

Goodwill acquired through business combinations have been allocated to each individual power generation unit ("CGU"). A CGU level summary of goodwill is presented below:

The recoverable amount of a CGU is determined based on value-in-use calculations. These calculations use pre-tax cash flow projections prepared by management based on balance life of the license or the plant and equipment where the license has indefinite life. The growth rate does not exceed the long-term average growth rate for the business in which the CGU operates.

The key assumptions used for value-in-use calculations are as follows:

Management has determined gross margins based on industry trends and the existing PPA with the transmission companies. The PPA is a long-term contract with agreed price per unit of power sold, and the growth rates used are consistent with those contracts. The discount rate used is pre-tax and reflects the specific risks associated with the entity.

8. Property, plant and equipment

Borrowings as at 31 March 2013 aggregating to €247,863,208 (31 March 2012: €153,069,265) are secured against all of the Group's present and future moveable and immovable assets, including the property, plant and equipment shown above. These loans are also secured by the personal guarantees of certain directors and pledge of shares of the subsidiaries held by the Group.

During the year, the Group has capitalised borrowing costs amounting to €21,178,906 (31 March 2012: €5,950,176) on qualifying assets. Borrowing costs were capitalised at the weighted average rate of its general borrowings of 13.52 percent. Notes 26 (e) and (f) provide details of asset purchase commitments outstanding as at 31 March 2013.

9. Financial instruments by category

The accounting policies for financial instruments have been applied to the line items below:

Investment in bank deposits as at 31 March 2013 include restricted balances aggregating to €10,108,461 (31 March 2012: €8,434,986).

The carrying amounts reported in the statement of financial position for cash and cash equivalents, trade and other receivables, trade and other payables and other liabilities approximate their respective fair values due to their short maturity.

Fair value hierarchy

Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3 - Inputs for the assets or liabilities that are not based on observable market data (unobservable inputs).

The following table presents the fair value hierarchy of assets and liabilities measured at fair value on a recurring basis as of 31 March 2013:

10. Available-for-sale financial assets