25th Mar 2008 16:21
Alpha Tiger Property Trust Limited25 March 2008 25 March 2008 ALPHA TIGER PROPERTY TRUST LIMITED("ALPHA TIGER" OR THE "COMPANY") NOTIFICATION OF YEAR END RESULTS Alpha Tiger, the Indian real estate development and investment company, todayannounces its results covering the period from incorporation to 31 December 2007 Highlights include: • The Company is close to conditional full equity commitment based on executed transactions • Net Asset Value per share 99.1 pence up 3.1 per cent. since admission (after issue costs) • Profit after interest and tax for the period of £2.3 million (3.0 pence per share) • Developed strong local partnerships in India • Execution of legally binding framework agreement with Xansa Plc (‘ Xansa’) and progression of transactions within this agreement: • The agreement includes the purchase of 40 acres of development land in Chennai and Pune. In respect of the undeveloped land at Chennai: • the 25 acre long leasehold land, currently undeveloped, has been approved as a Special Economic Zone (“SEZ”); • approval from the freeholder, SIPCOT (State Industries Promotion Corporation of Tamil Nadu Limited), has been received for Alpha Tiger to act as co-developer; • it is intended that the Company will develop approximately 2.2 million sq. ft. on the land in four phases over four to five years. • The agreement provides for the sale and leaseback of Xansa’s real estate interests in India – at NOIDA, Chennai and Pune; and • Alpha Tiger has been appointed as Xansa’s preferred real estate supplier in India • The Company has developed a key strategic relationship with Logix Group (& ldquo;Logix”), one of the leading developers of business parks in North India. To date the Company has reached agreement on several opportunities with Logix and has specifically: • Executed a transaction at NOIDA, Sector 132 – “Logix Technova” - to co-develop approximately 575,000 square feet of business park and other support facilities at the site. The agreement provides for Alpha Tiger to acquire a 74 per cent. equity interest for a cash commitment of £11.5 million. Site works have commenced and completion is expected no later than December 2009; • Announced today, a further transaction at NOIDA in Sector 140a – to co-develop approximately 1.2 million square feet of business park-led space in an SEZ and representing a cash commitment of £14.7 million for a 50% interest. Contact: David JeffreysChairman, Alpha Tiger01481 723450 Brad BaumanFund Manager, Alpha Real Capital India+ 91 9980 00 11 22 -------------------------------------------------------------------------------- Alpha Tiger Property Trust Limited Results for the period from incorporation to 31 December 2007-------------------------------------------------------------------------------- Company summary and objective Objective Alpha Tiger Property Trust Limited ("the Company" or "Alpha Tiger") invests inand develops real estate in India that offers high total returns. The Companyfocuses on business parks and business park-led mixed use properties. Strategy Alpha Tiger seeks to work closely with international occupiers and local realestate companies in order to access land and transition it through thedevelopment process, up the property value and quality curve. The Companyfocuses on working in partnerships to achieve reasonably priced developments andinvestments which can deliver a number of key benefits to stakeholders, whichinclude: • High-quality, high-specification commercial space at competitive rents for Alpha Tiger's tenants; • Flexibility in terms of the scale, mix and timing of development for the benefit of both tenants and the communities in which Alpha Tiger participates; and • Strong profitability for investors. Management The Company's Investment Manager is Alpha Real Capital LLP ("the InvestmentManager"). Control of the Company rests with the non-executive Guernsey basedBoard of Directors. Listing The Company's shares were admitted to the Alternative Investment Market of theLondon Stock Exchange on 22 December 2006. Financial highlights Period 15 May 2006 to Period 15 May 2006 to 31 December 2007 30 June 2007 Net asset value (£'000) 74,338 73,121Net asset value per share 99.1p 97.5pProfit for the period (£'000) 2,267 1,051Earnings per share (basic and 3.0p 1.4pdiluted) -------------------------------------------------------------------------------- Chairman's Statement I am pleased to present the Company's results for the period from incorporationto 31 December 2007. Alpha Tiger was established for the purposes of investing in and developing realestate in India. The Company's objective is to target investment and developmentopportunities in real estate in India that will offer high total returns. TheCompany's investment strategy includes both property investment and development,focussing on business parks and business-park led mixed use properties andtownship projects. The Company seeks to diversify risk through investments in existing real estate,forward funding of development opportunities and development partnerships onboth a pre-committed and speculative basis, and to create a geographic spread ofproperties across India which provides a variety of tenants with strongcovenants. During 2007, the Indian real estate market has continued its robust performancedespite a global environment of financial uncertainty. Rents have continued togrow and property investment yields have fallen marginally as higher domesticinterest rates have stabilised despite continuing evidence of conservative banklending policies. Investment activity The Company has established a strong presence within the National Capital Region(NCR) of New Delhi. New Okhla Industrial Development Authority (NOIDA) hasconfirmed itself as a lower cost option for corporate occupiers and acompetitive alternative destination to Gurgaon for the IT/ITeS industry andother business park tenants. The Company is progressing substantial developments with Logix Group (Logix),one of the leading developers of business parks in Northern India. In NOIDASector 132 Alpha Tiger has executed an agreement with Logix to acquire a 74 percent. equity interest in a Special Purpose Vehicle (SPV) for the purposes ofholding and co-developing approximately 575,000 sq. ft. of business park andother support facilities. The anticipated cash commitment of the Company is£11.5 million. Subsequent to the year end, Alpha Tiger has invested £5.1million. Alpha Tiger has made a further investment in NOIDA at Sector 140a. This is aco-development in partnership with Logix to build 1.2 million square feet ofbusiness park-led space in an SEZ and representing a cash commitment of £14.7million for a 50% interest in the total development. Given its improving infrastructure and connectivity to Delhi and significanttenant demand for business park space, NOIDA is an ideal locality for theCompany to expand its activities. The Company is actively considering additionalprojects in this market. Additionally, as previously reported, the Company has conditionally agreed toacquire from Xansa plc (subsequently acquired by Groupe Steria SCA, listed onEuronext Paris) approximately 40 acres of development land and six investmentproperties in Chennai, Pune and NOIDA for up to £36 million, with the capacityto develop up to 3.4 million sq. ft. of new business park space. The Companycurrently intends to initially commit up to £40 million of additional capitalexpenditure to build 1.7 million sq. ft. of high-quality business park space. In aggregate, the Company is close to conditional full equity commitment basedon executed transactions. Results, finance and dividends Results for the period show a profit after interest and tax of £2.3 million. The net asset value per share was 99.1 pence at 31 December 2007. The Company has no existing borrowings but expects to target borrowing levels ofbetween 50% and 65% of Gross Assets in due course. In accordance with the dividend policy set out in the Company's AdmissionDocument, the Board does not propose to pay a dividend for the period. The Boardwill consider the payment of a dividend as the Company's development programmematures. Economic outlook India is the third largest economy in the world after the United States andChina as measured by purchasing power parity (PPP) with gross domestic product(GDP) in 2007 estimated to be $US 4.7 trillion (International Monetary Fund).India is also the second fastest growing major economy in the world, afterChina. Between 2004 and 2006, GDP grew at an average of 8.5% per annum. Thegrowth momentum has accelerated further and GDP is estimated to have grown atover 9.0% in 2007. This growth is supported by India's stable political outlook,growing foreign exchange reserves, sustained growth in its service andindustrial sectors, young demographic profile and regulated financialenvironment. The services sector, which is a key source of demand for business park space, isthe fastest growing sector in the Indian economy. From 2007 to 2011, growth inthis sector is expected to be 13.9% per annum. The Indian real estate industry has grown at 30% per annum over the past fewyears and is expected to grow in excess of 20% per annum over the next fewyears. The industry is expected to grow from US$48 billion in FY2007 to US$140billion by FY2012 (CAGR of 21% per annum.). (Ernst and Young - Indian RealEstate (December 2007)) Property market outlook Growth in rental and capital values is expected to continue in the year aheadwith demand for space from tenants likely to exceed supply. The absence of a securitised debt market has insulated India from the recentuncertainties in European and US credit markets and, despite rises in Indianinterest rates, investment asset prices have continued to strengthen, reflectingthe strong financial growth drivers underlying the Indian property market. The 39 million sq. ft. of new office supply absorbed in 2007 has demonstratedthe continued maturation of the Indian market with space absorption and rentalsreaching all time highs across many sub-markets. The rental trend line has continued to rise during the year with significantrental escalations in markets such as the NCR, Bangalore and Mumbai. Delhi National Capital Region The NCR market with its overall competitiveness, including infrastructure andmanpower, continues to grow as a corporate destination. Improvements such as theDelhi-Gurgaon Highway are expected to open in the next quarter improving thetraffic flow between the cities and communication within the NCR. The year aheadis expected to see continued demand for business park space. Chennai The city is still on a growth curve with improved focus on infrastructureincluding improvements to the Old Mahabalipuram Road, where the Company'sChennai development project is located. The city has witnessed substantial newinvestment in infrastructure and enjoys strong tenant demand. Pune The proposed expansion of the city limits by the Pune Municipal Corporation willpromote planned growth which should benefit the Xansa site at Talewade. Theskyline of the city is also set to change with State Government relaxation ofheight restrictions. In addition the repealing of the Urban Land Ceiling Actwill make land capable of supporting additional development. Real Estate Investment Trusts During the period, the Securities and Exchange Board of India released a draftproposal for the launch of a scheme for Real Estate Investment Trusts. This willallow retail investors to participate in the real estate industry which shouldprovide a further impetus for values and liquidity. It also has the potential toprovide the Company with a further avenue to create value in the future. Summary The Company continues to see attractive opportunities for investing in Indianreal estate - particularly business park developments. Generally, both economicand property market conditions remain favourable with strong and growing tenantdemand keeping pace with increasing availability of stock. In particular, thereremains a significant market opportunity for higher-quality, operationallyefficient business park space that meets the international standards of globaloccupiers. Alpha Tiger remains focused on creating value and quality real estate throughthe development of world class business park-led environments. David JeffreysChairman25 March 2008 -------------------------------------------------------------------------------- Property Investment Review Alpha Tiger has established a very strong base for future growth. The Company'spipeline has been further strengthened by forging promising relationships withleading local development partners demonstrating world-class execution and withinternational tenants. The Company executed a legally binding framework agreement with Xansa plc, aleading outsourcing and technology company, to purchase 40 acres of developmentland and the sale and leaseback of Xansa's real estate interests in India. Theagreement also appoints Alpha Tiger as Xansa's preferred real estate supplier inIndia to facilitate best-in-class development and management of the properties. Xansa subsequently announced a takeover by Groupe Steria SCA, and this islikely, in the opinion of the Investment Manager, to improve the potentialopportunity for the Company as a strategic real estate supplier for Xansa'scontinuing business expansion in India. The Company is advancing the execution of transactions envisaged within theframework agreement and will announce their completion in due course. Theproperties subject to the new agreement are as follows: Development Land Chennai - 25 acres The Chennai site is long leasehold with development rights over 25 acres ofundeveloped land. The land has received Special Economic Zone (SEZ) approval andis awaiting final notification from the Ministry of Commerce. Approval has beenreceived for the arrangements whereby the site will be transferred to a new SPVand for Alpha Tiger to be appointed as co-developers. Substantial progress hastaken place in respect of the project: a detailed feasibility study has beencompleted, development managers have been appointed, and the masterplanning ofthe site has been significantly progressed. The land will provide developmentpotential for at least 2.2 million sq .ft. of floor space and it is intendedthat the site will be developed in four phases over four to five years. Pune - 15.7 acres The Pune site is a long leasehold with development rights over approximately15.7 acres. This site has the ability to develop up to an additional area ofapproximately 1.2 million sq. ft. of floor space. The intention is to developthis site in three phases over three to four years. Investment Properties NOIDA The properties in NOIDA, within the National Capital Region of Delhi, consist oftwo separately located office buildings; one four storey building (with groundand two basement levels) over 180,000 sq. ft. of floor area; and a two-storeybuilding (with ground and basement level) over 42,000 sq. ft. of floor area. Pune The properties in Pune comprise two two-storey buildings within a master plannedbusiness park: (Phase I with basement, ground floor, first floor and canteen;Phase II with two basements, ground floor and first floor), in a campus-stylesetting with a combined floor area of over 95,000 sq. ft. Chennai (Madras) The properties in Chennai are in a campus-style development with two threestorey buildings representing a floor area of over 165,000 sq. ft. Development Funding NOIDA On 3 December 2007, the Company announced it had entered into an agreement toacquire a 74 per cent. equity interest in a business park project (LogixTechnova) in NOIDA Sector 132, in the NCR, near Delhi, India. Subsequent to thebalance sheet date, the Company has invested in partnership with Logix in a SPVincorporated for the purpose of holding and developing the land which is thesubject of the transaction. The Company together with Logix will develop approximately 575,000 sq. ft. ofbusiness park and other support facilities at the site. The estimated cashrequirement to be paid by the Company for 74 per cent. of the equity (voting andeconomic rights) in the SPV is INR 895 million (£11.5 million). This amountshall be satisfied in stages. Since the balance sheet date, INR 400 million(£5.1 million) has been paid, further to the satisfaction of certain conditionsprecedent. Upon the earlier of either the SPV achieving 90 per cent. of theleasable area being contracted to prospective tenants and 24 months from thedate of the transaction, Alpha Tiger shall subscribe for further equity toachieve 74% of voting and economic ownership of the SPV. Prior to thisconversion mechanism, the Company shall retain a 5 per cent. voting interest inthe SPV. The SPV has entered into a development agreement with VC Solutions PrivateLimited for the construction of the buildings and the development is forecast tobe completed and occupied within 24 months (by December 2009). On 25 March 2008, the Company announced that it had entered into an agreementwith Logix for a 1.2 million sq.ft. co-development in Sector 140a. The Companyhas agreed to acquire a 50% stake in an SPV which owns the development. The SPV has an agreement to sub-lease 45 per cent. of a larger 24.8 acre plotwhich was originally leased to Sarv Mangal Realtech Pvt Limited ("Sarv Mangal")from NOIDA on a 90 year lease. Development of an SEZ has been formally approvedby the Indian Government's Board of Approval. The SPV has also executed aco-development agreement with Sarv Mangal, providing equivalent developmentrights and benefits. Alpha Tiger has committed INR 1147 million (£14.7 million) to acquire the 50 percent. equity interest in the SPV which has an agreement to sub-lease the landand will undertake the development for an aggregate construction cost of c. INR2100 million (£26.9 million). Based on the above transactions representing 93 per cent of net proceeds atflotation, the Company is close to conditional full commitment and has anexciting portfolio of business park-led projects in India's major cities. Brad Bauman For and on behalf of the Investment Manager25 March 2008 -------------------------------------------------------------------------------- Directors David Jeffreys (aged 48) David Jeffreys qualified as a Chartered Accountant with Deloitte Haskins andSells. He was Managing Director of Abacus Fund Managers (Guernsey) Limitedbetween 1993 and 2004. Currently he carries out a number of consultancyassignments as well as being a director of a number of investment funds. Phillip Rose (aged 48) Phillip Rose has 25 years experience in the real estate, funds management andbanking industries in Europe, the USA and Australasia. He has been the Head ofReal Estate for ABN AMRO Bank, Chief Operating Officer of European shoppingcentre investor and developer TrizecHahn Europe, Managing Director of Lend LeaseGlobal Investment and Executive Manager of listed fund General Property Trust. Phillip is currently CEO of Alpha Real Capital LLP, a non executive director ofGreat Portland Estates Plc and a member of the Management Committee of theHermes Property Unit Trust. Serena Tremlett (aged 43) Serena Tremlett is Company Secretary of Assura Group Limited, a company listedon the London Stock Exchange investing primarily in healthcare property,pharmacy and related medical businesses. She was previously the Head of GuernseyProperty Funds at Mourant Guernsey Limited where she sat on the board of anumber of property and other investment funds. Jeff Chowdhry (aged 47) Jeff Chowdhry is currently Head of Emerging Market Equities at F&C AssetManagement plc, with overall responsibility for investments in global emergingmarkets. Previously, from 1997 to 2005, he was a director of Sun F&C AssetManagement (India) Limited and also (until 1999) managed the Indian InvestmentCompany SICAV, an open ended investment fund registered in Luxembourg. In 1994he managed the India Fund Inc, a closed ended investment fund listed in New Yorkthat seeks long-term capital appreciation through investing primarily in Indianequities. Roddy Sage (aged 55) Roddy Sage is currently chief Executive Officer of the AFP group of companies,providing corporate and taxation advisory services in Asia. Prior to that hespent 20 years with KPMG Hong Kong, 10 years of which were as Senior Tax Partnerfor Hong Kong and China. He has held Chairmanships within KPMG and outside asChairman of the Hong Kong General Chamber of Commerce's Taxation Committee andis a non-executive director of Tai Ping Carpets International. -------------------------------------------------------------------------------- Directors' report The Directors present their report and financial statements of the Company andthe Group for the period from its incorporation on 15 May 2006 to 31 December2007. Status The Company was founded on 15 May 2006. Its shares are traded on the AlternativeInvestment Market, a market operated by the London Stock Exchange. The company is a closed-ended Guernsey registered investment company. Principal activities During the period the Company carried on business as a property investment anddevelopment company, investing in commercial property in India. Business review A review of the business during the period is contained in the Chairman'sStatement. Results and dividend The results for the period are set out in the financial statements. Inaccordance with the dividend policy set out in the Company's Admission document,the Board does not propose to pay a dividend for the period. Directors The directors, all of whom are non-executive and have served to the date of thisreport, are detailed below: AppointedDavid Jeffreys (Chairman) 15 May 2006Phillip Rose 15 May 2006Serena Tremlett 15 May 2006Jeff Chowdhry 15 May 2006Roddy Sage 15 May 2006 At each annual general meeting of the Company, one third by number of thedirectors shall retire from office in accordance with the Articles ofAssociation. The inaugural Annual General Meeting is scheduled for 23 May 2008. A retiring director shall be eligible for reappointment. No director shall be required to vacate his office at any time by reason of thefact that he has attained any specific age. The biographies of the Directors are above. The Board considers that there is a balance of skills and experience within theBoard and that each of the Directors contributes effectively. Directors' interests The following Directors had interests in the shares of the Company at 31December 2007: Number of ordinary sharesDavid Jeffreys 10,000Phillip Rose 200,000Serena Tremlett -Jeff Chowdhry 20,000Roddy Sage - There have been no changes in the Directors' interests since the period end. Directors' remuneration During the period the directors received the following emoluments in the form offees from Group companies: £David Jeffreys 30,904Phillip Rose 20,603Serena Tremlett 20,603Jeff Chowdhry 20,603Roddy Sage 20,603Total 113,316 The Company's Articles of Association limit the aggregate fees payable to theDirectors at £200,000 per annum. Directors' and officers' liability insurance cover is in place in respect of theDirectors. There are no service contracts in existence between the Company and Directors,however each of the Directors was appointed by a letter of appointment whichsets out the main terms of their appointment. Substantial shareholding Shareholders with holdings of more than 3 per cent of the issued ordinary sharesof the Company as at 13 March 2008 were as follows: Name of investor No. of ordinary shares % held Vidacos Nominees Limited 14,799,597 19.7Chase Nominees Limited 11,400,000 15.2Citigroup Global Markets U.K. Equity Limited 10,586,526 14.1Deutsche Bank Aktiengesellschaft London 5,771,900 7.7Wedd Jefferson (Nominees) Limited 5,100,000 6.8Nortrust Nominees Limited 4,762,600 6.4HSBC Global Custody Nominees (UK) Limited 4,563,400 6.1IPGL Fund Services Ltd 3,000,000 4.0Goldman Sachs Securities (Nominees) Limited 2,600,000 3.5 Management The Investment Manager provides investment advisory services to the Company andproperty advisory, property management and monitoring services to those membersof the Group which acquire properties, in each case in accordance with theinvestment objective and investment policy and restrictions of the Group. Directors' responsibility statement Company law requires the directors to prepare Financial Statements for eachfinancial period, which give a true and fair view of the state of affairs of theCompany and of the Group at the end of the period and of the profit or loss ofthe Company and the Group for that period. In preparing those Financial Statements, the directors are required to: (1) select suitable accounting policies and then apply them consistently; (2) make judgements and estimates that are reasonable and prudent; (3) state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the Financial Statements; (4) prepare the Financial Statements on the going concern basis unless it is appropriate to assume that the Group and Company will not continue in business. The Directors are responsible for keeping proper accounting records whichdisclose with reasonable accuracy at any time the financial position of theCompany and of the Group and to enable them to ensure that the financialstatements comply with The Companies (Guernsey) Law, 1994. They are alsoresponsible for safeguarding the assets of the Group and hence for takingreasonable steps for the prevention and detection of fraud and otherirregularities. The Directors confirm that they have complied with the above requirements inpreparing the Financial Statements. Corporate Governance A statement of Corporate Governance is below. Going Concern After making enquiries, and bearing in mind the nature of the Company's businessand assets, the Directors consider that the Company has adequate resources tocontinue in operational existence for the foreseeable future. For this reason,they continue to adopt the going concern basis in preparing the FinancialStatements. Annual General Meeting The inaugural AGM of the company will be held in Guernsey on 23 May 2008. Auditors BDO Novus Limited have expressed their willingness to continue in office asauditors and a resolution to reappoint them will be proposed at the forthcomingAnnual General Meeting. By order of the Board, David Jeffreys Serena TremlettDirector Director25 March 2008 -------------------------------------------------------------------------------- Corporate governance Guernsey does not have its own corporate governance regime and, as a Guernseyregistered company, the Company is not required to comply with the Combined Codeon Corporate Governance, issued by the Financial Reporting Council. However itis the Company's policy to comply with best practice on good corporategovernance including taking measures to ensure the Company complies with theCombined Code to the extent appropriate. The Board's arrangements in respect ofcorporate governance are explained in the paragraphs that follow: Role of the Board The Board has determined that its role is to consider and determine thefollowing principal matters which it considers are of strategic importance tothe Company: 1) Review the overall objectives for the Company and set the Company's strategy for fulfilling those objectives within an appropriate risk framework; 2) Consider any shifts in strategy that it considers may be appropriate in light of market conditions; 3) Review the capital structure of the Company including consideration of any appropriate use of gearing both for the Company and in any joint ventures in which the Company may invest from time to time; 4) Appoint the Investment Manager, Administrator and other appropriately skilled service providers and monitor their effectiveness through regular reports and meetings; 5) Review key elements of the Company's performance including Net Asset Value and payment of dividends. Board Decisions At board meetings, the Board ensures that all the strategic matters areconsidered and resolved by the Board. Certain issues associated withimplementing the Company's strategy are delegated either to the InvestmentManager or the Administrator. Such delegation is over minor incidental mattersand the Board continually monitors the services provided by these independentagents. The Board considers there are implementation matters that aresignificant enough to be of strategic importance and should be reserved solelyfor the Board (e.g. all acquisitions, all disposals, significant capitalexpenditure, leasing and decisions affecting the Company's financial gearing). Board Meetings The Board meets at least quarterly and as required from time to time to considerspecific issues reserved for decision by the Board including all potentialacquisitions. At the Board's quarterly meetings it considers papers circulated in advanceincluding reports provided by the Investment Manager and the Administrator. TheInvestment Manager's report comments on: • The Indian property markets including recommendations for any changes in strategy that the Investment Manager considers may be appropriate; • Performance of the Group's portfolio and key asset management initiatives; • Transactional activity undertaken over the previous quarter and being contemplated for the future; • The Group's financial position including relationships with bankers and lenders. The Administrator provides the compliance report. These reports enable the Board to assess the success with which the Group'sproperty strategy and other associated matters are being implemented and alsoconsider any relevant risks and to consider how they should be properly managed. The Board also considers reports provided from time to time by its variousservice providers reviewing their internal controls. In between its regular quarterly meetings, the Board has also met on a number ofoccasions during the period to approve all transactions and for other matters. Committees of the Board The Board has operated an Audit Committee throughout the period under review andon 28 November 2007 constituted a Remuneration Committee and a NominationCommittee. The Audit Committee The Audit Committee is chaired by David Jeffreys and includes Roddy Sage andSerena Tremlett. The Audit Committee meets not less than twice a year and ifrequired meetings can also be attended by the Investment Manager, theAdministrator and the Independent Auditors. The Audit Committee is responsible for reviewing the half-year and annualFinancial Statements before their submission to the Board. In addition, theAudit Committee is specifically charged under its terms of reference to advisethe Board on the terms and scope of the appointment of the auditors (includingremuneration), the independence and objectivity of the auditors, and reviewingwith the auditors the results and effectiveness of the audit. Members of the Audit Committee may also, from time to time meet with theCompany's valuer to discuss the scope and conclusions of their work. The Remuneration Committee The Remuneration Committee, chaired by Serena Tremlett includes Jeff Chowdhryand David Jeffreys and is required to consider the terms and remuneration of theCompany's directors and senior employees. The Nomination Committee The Nomination Committee, chaired by Roddy Sage includes Phillip Rose and SerenaTremlett and is convened for the purpose of considering the appointment ofadditional directors as and when considered appropriate. The table below shows the attendance at Board and other Committee meetingsduring the period to 31 December 2007: Director Board Audit Remuneration Nomination committee committee committee David Jeffreys 20 2 1 -Phillip Rose 8 - - 1Serena Tremlett 20 2 1 1Jeff Chowdhry 7 - 1 -Roddy Sage 5 2 - 1No. of meetings during the 20 2 1 1year Investment management agreement The Company has entered into an agreement with the Investment Manager. This setsout the Investment Manager's key responsibilities which include proposing aproperty investment strategy to the Board, identifying property investments torecommend for acquisition and arranging appropriate lending facilities tofacilitate the transaction. The Investment Manager is also responsible to theBoard for all issues relating to property asset management. Shareholder relations Shareholder communications are a high priority of the Board. Members of theInvestment Manager's Investment Committee make themselves available at allreasonable times to meet with key shareholders and sector analysts. Feedbackfrom these sessions is provided by the Investment Manager at the quarterly Boardmeetings. In addition, the Board is also kept fully appraised of all market commentary onthe Company by the Investment Manager and other professional advisors includingits brokers. Through this process the Board seeks to monitor investor relations and to ensurethat the Company's communication programme is effective. The Chairman and the Investment Manager will be available at the Annual GeneralMeeting to answer any questions that shareholders attending may wish to raise. -------------------------------------------------------------------------------- Independent auditors' report To the members of Alpha Tiger Property Trust Limited We have audited the Group and parent Company financial statements ("theFinancial Statements") of Alpha Tiger Property Trust Limited for the periodended 31 December 2007, which comprise the Consolidated and Company IncomeStatement, Consolidated and Company Balance Sheet, Consolidated and Company CashFlow Statement, Consolidated and Company Statement of Changes in Equity and therelated notes 1 to 18. These Financial Statements have been prepared inaccordance with the accounting policies as set out below. This report is made solely to the Company's members, as a body, in accordancewith Section 64 of the Companies (Guernsey) Law, 1994. Our audit work isundertaken so that we might state to the Company's members those matters we arerequired to state to them in an auditors' report and for no other purpose. Tothe fullest extent permitted by law we do not accept or assume responsibility toanyone other than the Company and the Company's members as a body, for our auditwork, for this report, or for the opinions we have formed. Respective responsibilities of the directors and auditors As described in the Directors' Responsibility Statement within the Directors'Report, the Company's directors are responsible for the preparation of theFinancial Statements in accordance with applicable law and InternationalFinancial Reporting Standards ("IFRS"). Our responsibility is to audit the Financial Statements in accordance with therelevant legal and regulatory requirements and International Standards onAuditing (UK and Ireland). We report to you our opinion as to whether the Financial Statements give a trueand fair view and are properly prepared in accordance with the Companies(Guernsey) Law, 1994. We also report to you if, in our opinion, the Directors'Report is not consistent with the Financial Statements, if the Company has notkept proper accounting records, if we have not received all the information andexplanations we require for our audit, or if the information specified by law isnot disclosed. We read the other information included in the Annual Report and consider whetherit is consistent with the audited Financial Statements. This other informationcomprises only the Company Summary and Objective, Financial Highlights,Chairman's Statement, Property Investment Review, Directors, Directors' Reportand Corporate Governance. We consider the implications for our report if webecome aware of any apparent misstatements or material inconsistencies with theFinancial Statements. Our responsibilities do not extend to any otherinformation. Basis of opinion We conducted our audit in accordance with International Standards on Auditing(UK and Ireland) issued by the Auditing Practices Board. An audit includesexamination, on a test basis, of evidence relevant to the amounts anddisclosures in the Financial Statements. It also includes an assessment of thesignificant estimates and judgements made by the directors in the preparation ofthe Financial Statements, and of whether the accounting policies are appropriateto the Company's circumstances, consistently applied and adequately disclosed. We planned and performed our audit so as to obtain all the information andexplanations which we considered necessary in order to provide us withsufficient evidence to give reasonable assurance that the Financial Statementsare free from material misstatement, whether caused by fraud or otherirregularity or error. In forming our opinion we also evaluated the overalladequacy of the presentation of information in the Financial Statements. Opinion In our opinion: • The Group Financial Statements give a true and fair view, in accordance with IFRS, of the state of the Group's affairs at 31 December 2007 and of its profit for the period 15 May 2006 to 31 December 2007. • The Company Financial Statements give a true and fair view, in accordance with IFRS, of the state of the Company's affairs at 31 December 2007 and of its profit for the period 15 May 2006 to 31 December 2007. • The Financial Statements have been properly prepared in accordance with the Companies (Guernsey) Law, 1994. BDO Novus LimitedChartered AccountantsElizabeth House, St Peter Port, Guernsey25 March 2008 -------------------------------------------------------------------------------- Consolidated income statement For the period from 15 May 2006 to 31 December 2007 Revenue Capital Total Notes £'000 £'000 £'000 IncomeRevenue - - -Total income - - - ExpensesAdministration costs 4 (2,056) - (2,056)Total expenses (2,056) - (2,056) Operating loss (2,056) - (2,056) Finance income 3 4,323 - 4,323 Profit before taxation 2,267 - 2,267 Taxation 5 - - - Profit for the period 2,267 - 2,267 Earnings per share (basic and diluted) 7 3.0p - 3.0p The total column of this statement represents the Group's income statement,prepared in accordance with IFRS. The revenue and capital columns are suppliedas supplementary information permitted under IFRS. All items in the abovestatement derive from continuing operations. There are no minority interests. The accompanying notes form an integral part of this statement. -------------------------------------------------------------------------------- Consolidated balance sheetAs at 31 December 2007 Notes £'000 Current assetsTrade and other receivables 11 791Cash and cash equivalents 74,104 Total assets 74,895 Current liabilitiesTrade and other payables 12 (557)Total liabilities (557) Total assets less current liabilities 74,338 Net assets 74,338 EquityShare capital 13 -Share premium 14 -Special reserve 14 72,031Warrant reserve 14 40Revenue reserve 14 2,267 Total equity 74,338 Net asset value per share 8 99.1p The Financial Statements were approved by the board of directors and authorisedfor issue on 25 March 2008. They were signed on its behalf by David Jeffreys andSerena Tremlett. The accompanying notes form an integral part of this statement. David Jeffreys Serena TremlettDirector Director -------------------------------------------------------------------------------- Consolidated cash flow statement For the period from 15 May 2006 to 31 December 2007 £'000 Operating activities Profit for the period 2,267 Adjustments for:Finance income (4,323) Operating cash flows before movements inworking capital (2,056)Movements in working capital: Increase in operating trade and other receivables (129) Increase in operating trade and other payables 557 Cash used in operations (1,628) Interest received 4,211Taxation - Cash flows from operating activities 2,583 Investing activities Acquisition costs - deposit paid and costs (550) Cash flows from investing activities (550) Financing activities Proceeds from issue of ordinary share capital 75,000 Issue costs (2,929) Cash flows from financing activities 72,071 Net increase in cash and cash equivalents 74,104 Cash and cash equivalents at beginning of period - Cash and cash equivalents at end of period 74,104 The accompanying notes form an integral part of this statement. -------------------------------------------------------------------------------- Consolidated statement of changes in equity For the period from Share Special Warrant Revenue Total 15 May 2006 to premium reserve reserve reserve reserves31 December 2007 £'000 £'000 £'000 £'000 £'000 Changes in equityfor the periodProfit for the period 2,267 2,267Total recognised income and expense for the period - - - 2,267 2,267 Shares issued 75,000 - - - 75,000Share issue costs (2,929) - - - (2,929)Share based payments (40) - 40 - -Transfer to specialreserve (72,031) 72,031 - - -At 31 December 2007 - 72,031 40 2,267 74,338Notes 13, 14 The accompanying notes form an integral part of this statement. -------------------------------------------------------------------------------- Company income statement For the period from 15 May 2006 to 31 December 2007 Revenue Capital Total Notes £'000 £'000 £'000 IncomeRevenue - - -Total income - - - ExpensesAdministration costs 4 (2,056) - (2,056)Total expenses (2,056) - (2,056) Operating loss (2,056) - (2,056) Finance income 3 4,381 - 4,381 Profit before 2,325 - 2,325taxation Taxation 5 - - - Profit for the period 2,325 - 2,325 The total column of this statement represents the Company's income statement,prepared in accordance with IFRS. The revenue and capital columns are suppliedas supplementary information permitted under IFRS. All items in the abovestatement derive from continuing operations. The accompanying notes form an integral part of this statement. -------------------------------------------------------------------------------- Company balance sheetAs at 31 December 2007 Notes £'000Non-current assetsInvestment in subsidiary undertaking 9 -Amount receivable from subsidiary 9 2,658undertaking Current assetsTrade and other receivables 11 791Cash and cash equivalents 71,504 Total assets 74,953 Current liabilitiesTrade and other payables 12 (557)Total liabilities (557) Net assets 74,396 EquityShare capital 13 -Share premium 14 -Special reserve 14 72,031Warrant reserve 14 40Revenue reserve 14 2,325 Total equity 74,396 The Financial Statements were approved by the board of directors and authorisedfor issue on 25 March 2008. They were signed on its behalf by David Jeffreys andSerena Tremlett. The accompanying notes form an integral part of this statement. David Jeffreys Serena TremlettDirector Director -------------------------------------------------------------------------------- Company cash flow statement For the period from 15 May 2006 to 31 December 2007Cash flows from operating activities Profit for the period 2,325 Adjustment for:Finance income (4,381) Operating cash flows before movements inworking capital (2,056)Movements in working capital:Increase in operating trade and other receivables (129)Increase in operating trade and other payables 557 Cash used in operations (1,628) Interest received 4,211Taxation - Cash flows from operating activities 2,583 Investing activities Loan to subsidiary (2,600) Acquisition cost - deposit paid and costs (550) Cash flows from investing activities (3,150) Financing activitiesProceeds from issue of ordinary share 75,000capitalIssue costs (2,929) Cash flows from financing activities 72,071 Net increase in cash and cash equivalents 71,504 Cash and cash equivalents at beginning of -period Cash and cash equivalents at end of period 71,504 The accompanying notes form an integral part of this statement. -------------------------------------------------------------------------------- Company statement of changes in equity For the period from Share Special Warrant Revenue Total15 May 2006 to 31 premium reserve reserve reserve reserves31 December 2007 £'000 £'000 £'000 £'000 £'000 Changes in equity for the periodProfit for the period 2,325 2,325Total recognised incomeand expense for the period - - - 2,325 2,325Shares issued 75,000 - - - 75,000Share issue costs (2,929) - - - (2,929)Share based payments (40) - 40 - -Transfer to special reserve (72,031) 72,031 - - -At 31 December 2007 - 72,031 40 2,325 74,396 Notes 13, 14 The accompanying notes form an integral part of this statement. -------------------------------------------------------------------------------- Notes to the financial statements 1. General information The Company is a limited liability, closed-ended investment company incorporatedin Guernsey. The address of the registered office is given below. The nature ofthe Group's operations and its principal activities are set out in theChairman's Statement. The Financial Statements were approved and authorised forissue on 25 March 2008 and signed by David Jeffreys and Serena Tremlett onbehalf of the Board. 2. Significant accounting policies A summary of the principal accounting policies, all of which have been appliedconsistently throughout the period, is set out below. Basis of accounting The Financial Statements of the Company and of the Group have been prepared inaccordance with IFRS, which comprise standards and interpretations approved bythe International Accounting Standards Board ("IASB"), and InternationalAccounting Standards and Standards Interpretations Committee interpretationsapproved by the International Accounting Standards Committee ("IASC") thatremain in effect, and to the extent that they have been adopted by the EuropeanUnion. The principal accounting policies adopted are set out below. a) Standards early adopted by the Company IFRS 7, Financial Instruments: Disclosures, and the complementary Amendment toIAS1, Presentation of Financial Statements - Capital Disclosures, wereearly adopted. IFRS 7 introduces new disclosures relating to financialinstruments. This standard does not have any impact on the classification andvaluation of the Company's financial instruments. In accordance with therequirements of the Amendment to IAS 1, additional disclosures have beenprovided on the Company's objectives and policies for its capital. b) Standards and interpretations in issue and not yet effective At the date of authorisation of these financial statements, the followingstandards and interpretations, which have not been applied in these financialstatements, were in issue but not yet effective:- New standards IFRS 8: Operating segments - for accounting periods commencing on orafter 1 January 2009. Revised and amended standards IFRS 2: Share Based Payments - for accounting periods commencing on orafter 1 January 2009. IFRS 3: Business Combinations - for accounting periods commencing on orafter 1 July 2009. IAS 1: Presentation of Financial Statements - for accounting periodscommencing on or after 1 January 2009. IAS 23: Borrowing costs - for accounting periods commencing on or after1 January 2009. IAS 27: Consolidated and Separate Financial Statements - for accountingperiods commencing on or after 1 July 2009. IAS 32: Financial Instruments; Presentation - for accounting periodscommencing after 1 January 2009. Interpretations IFRIC 9: Reassessment of Embedded Derivatives - for accounting periodsbeginning on or after 1 June 2006. IFRIC 10: Interim Financial Reporting and Impairment - for accountingperiods beginning on or after 1 November 2006 IFRIC 11: IFRS 2 - Group and Treasury Share Transactions - foraccounting periods commencing on or after 1 March 2007. IFRIC 12: Service Concession Arrangements - for accounting periodscommencing on or after 1 January 2008. IFRIC 13: Customer Loyalty Programmes - for accounting periodscommencing on or after 1 July 2008. IFRIC 14: IAS 19 - The limit on a Defined Benefit Asset, Minimum FundingRequirements and their Interaction - for accounting periods commencingon or after 1 January 2008. The Directors anticipate that the adoption of these standards andinterpretations in future periods will not have a material impact on thefinancial statements of the Company or of the Group. Basis of consolidation The consolidated financial statements incorporate the financial statements ofthe Company and the SPVs controlled by the company, made up to 31 December eachyear. Control is achieved where the Company has the power to govern thefinancial and operating policies of an investee entity so as to obtain benefitfrom its activities. The results of SPVs acquired or disposed of during the period are included inthe consolidated income statement from the effective date of acquisitions or upto the effective date of disposal as appropriate. When necessary, adjustments are made to the financial statements of SPVs tobring the accounting policies used into line with those used by the Company. All intra-group transactions, balances, income and expenses are eliminated onconsolidation. Presentation of income statement In order to better reflect the activities of an investment company and inaccordance with guidance issued by the Association of Investment Companies ("AIC"), supplementary information which analyses the income statement betweenitems of a revenue and capital nature has been presented alongside the incomestatement. Revenue recognition Interest income is accrued on a time basis, by reference to the principaloutstanding and the effective interest rate applicable. Foreign currencies a) Functional and presentation currency Items included in the financial statements of each of the Group entities aremeasured in the currency of the primary economic environment in which the entityoperates (the "functional currency"). The consolidated financial statements arepresented in pounds Sterling, which is the Company's functional andpresentational currency. b) Transactions and balances Transactions in currencies other than pounds Sterling are recorded at the ratesof exchange prevailing on the dates of the transactions. At each Balance Sheetdate, monetary assets and liabilities that are denominated in foreign currenciesare retranslated at the rates prevailing on the Balance Sheet date. Non-monetaryassets and liabilities carried at fair value that are denominated in foreigncurrencies are translated at the rates prevailing at the date when the fairvalue was determined. Gains and losses arising on retranslation are included innet profit or loss for the period, except for exchange differences arising onnon-monetary assets and liabilities where the changes in fair value arerecognised directly to equity. c) Group companies The results and financial position of all the Group entities that have afunctional currency different from the presentational currency are translatedinto the presentational currency as follows: i) assets and liabilities for each balance sheet presented are translated at the closing rate at the date of the balance sheet; ii) income and expenses for each income statement are translated at the average exchange rate prevailing in the period; and iii) all resulting exchange differences are recognised as a separate component of equity. On consolidation, the exchange differences arising from the translation of thenet investment in foreign entities are taken to shareholders' equity. When aforeign operation is sold, such exchange differences are recognised in theincome statement as part of the gain or loss on sale. The year end exchange rate used is £1.00 : INR 78.76 and the average rate forthe year used is £1.00 : INR 79.73. Operating profit Operating profit includes revenue and administration costs and excludes financeincome and finance costs. Expenses All expenses are accounted for on an accruals basis and include those of theAdministrators, the Investment Manager and the Directors. In respect of theanalysis between revenue and capital items, presented within the incomestatement, all expenses have been presented as revenue items except as follows: Expenses which are incidental to the acquisition of an investment property areincluded within the cost of that investment property. Taxation The Company is exempt from Guernsey taxation on income derived outside ofGuernsey and bank interest earned in Guernsey under the Income Tax (ExemptBodies) (Guernsey) Ordinance, 1989. A fixed annual fee of £600 is payable to theState of Guernsey in respect of this exemption. No charge to Guernsey taxationarises on capital gains. The Group is liable to foreign tax arising onactivities in the overseas subsidiaries. At present the Group only hassubsidiary operations in Cyprus. Deferred tax is the tax expected to be payable or recoverable on differencesbetween the carrying amount of assets and liabilities in the financialstatements and the corresponding tax bases used in the computation of taxableprofit, and is accounted for using the Balance Sheet liability method. Deferredtax liabilities are generally recognised for all taxable temporary differencesand deferred tax assets are recognised to the extent that it is probable thattaxable profits will be available against which deductible timing differencescan be utilised. The carrying amount of deferred tax assets is reviewed at each balance sheetdate and reduced to the extent that it is no longer probable that sufficienttaxable profits will be available to allow all or part of the asset to berecovered. Deferred tax is calculated at the tax rates that are expected toapply in the year when the liability is settled or the asset realised. Deferredtax is charged or credited in the income statement, except when it relates toitems charged or credited directly to equity, in which case the deferred tax isalso dealt within equity. Dividends Dividends are recognised as a liability in the group's financial statements inthe period in which they become obligations of the Company. Segmental reporting The Directors are of the opinion that the Group is engaged in a single segmentof business being property investment business. The Group operates in a singlegeographical segment (India). Share-based payments The Group makes equity-settled share-based payments to certain advisers andservice providers. Equity-settled share-based payments are measured at fairvalue as at the date of grant. The fair value determined at grant date isexpensed on a straight line basis over the vesting period, based on the Group'sestimate of the number of instruments that will eventually vest. Investment in subsidiaries Investments in subsidiaries are initially recognised and subsequently carried atcost less provisions for impairment (where applicable) in the Company'sfinancial statements. Financial instruments Financial assets and financial liabilities are recognised on the Group's balancesheet when the Group becomes a party to the contractual provisions of theinstrument. The Group shall offset financial assets and financial liabilities ifthe Group has a legally enforceable right to set off the recognised amounts andinterests and intends to settle on a net basis. (a) Financial assets The Group's financial assets fall into the categories discussed below, with theallocation depending to an extent on the purpose for which the asset wasacquired. The Group has not classified any of its financial assets as fair valuethrough profit or loss, held to maturity or as available for sale. Unless otherwise indicated, the carrying amounts of the Group's financial assetsare a reasonable approximation of their fair values. (a)(i) Loans and receivables These assets are non-derivative financial assets with fixed or determinablepayments that are not quoted in an active market. These arise principallythrough cash and cash equivalents, but also incorporate other types ofcontractual monetary assets. They are initially recognised at fair value plustransaction costs that are directly attributable to the acquisition on issue andsubsequently carried at amortised cost using the effective interest rate method,less provision for impairment. The effect of discounting on these financial instruments is not considered to bematerial. Impairment provisions are recognised when there is objective evidence (such assignificant financial difficulties on the part of the counterparty or default ofsignificant delay in payment) that the Group will be unable to collect all ofthe amounts due. The amount of such a provision being the difference between thenet carrying amount and the present value of the future expected cash flowsassociated with the impaired receivable. Cash and cash equivalents are held to maturity are carried at cost and consistof cash in hand and short term deposits in banks with an original maturity ofthree months or less. (a) (ii) De-recognition of financial assets A financial asset (in whole or in part) is derecognised either: • when the Group has transferred substantially all the risks and rewards of ownership; or • when it has transferred nor retained substantially all the risks and rewards and when it no longer has control over the asset or a portion of the asset; or • when the contractual right to receive cash flow has expired. (b) Financial liabilities The Group's financial liabilities comprise of trade and other payables which areclassified as financial liabilities measured at amortised cost. Unless otherwise indicated, the carrying amounts of the Group's financialliabilities are a reasonable approximation of their fair values. (b) (i) Financial liabilities measured at amortised cost These include trade payables and other short-term monetary liabilities, whichare initially recognised at fair value and subsequently carried at amortisedcost using the effective interest method. (b) (ii) De-recognition of financial liabilities A financial liability (in whole or in part) is derecognised when the Group hasextinguished its contractual obligations, it expires or is cancelled. Any gainor loss on de-recognition is taken to the income statement. (c) Share capital Financial instruments issued by the Group are treated as equity only to theextent that they do not meet the definition of a financial liability. TheGroup's ordinary shares are classified as equity instruments. For the purposesof disclosures given in note 18 the Group considers all its reserves and equityas capital. The Company is not subject to any externally imposed capitalrequirements. (d) Effective interest method The effective interest method is a method of calculating the amortised cost of afinancial asset or liability and of allocating interest income or expense overthe relevant period. The effective interest rate is the rate that exactlydiscounts estimated future cash receipts or payments (including all fees onpoints paid or received that form an integral part of the effective interestrate, transaction costs and other premiums or discounts) through the expectedlife of the financial asset or liability, or, where appropriate, a shorterperiod. 3. Finance income For the period from 15 May For the period from 15 May 2006 to 31 December 2007 2006 to 31 December 2007 £'000 £'000 Group Company Bank interest 4,323 4,323Foreign exchange gain - 58Total 4,323 4,381 The above interest income arises from financial assets classified as loans andreceivables (including cash and cash equivalents) and has been calculated usingthe effective interest rate method. 4. Administration costs For the period from 15 May For the period from 15 May 2006 to 31 December 2007 2006 to 31 December 2007 £'000 £'000 Group CompanyAuditors' remuneration for audit 14 14servicesOther professional fees 247 247Accounts and administrative fees 190 190Investment Managers fees 1,492 1,492Non-executive directors fees 113 113Total 2,056 2,056 The Group and Company have no employees. No amounts were paid to BDO NovusLimited by the Company and its subsidiary undertakings in respect of non-auditservices. 5. Taxation (a) Company The Company is exempt from taxation under the provisions of the Income Tax(Exempt Bodies) (Guernsey) Ordinance, 1989. (b) Group The Group's tax expense for the period comprises: For the period from 15 May 2006 to 31 December 2007 £'000 GroupTax expense reconciliationProfit for the period 2,267Less: Income not taxable (4,323)Add: Expenditure not taxable 2,056Total - There are no deferred tax assets or liabilities at 31 December 2007. 6. Dividends No dividend has been paid or proposed for the period ended 31 December 2007. 7. Earnings per share The calculation of the basic and diluted earnings per share is based on thefollowing data: For the period 15 May 2006 to For the period 15 May 2006 to 31 December 2007 30 June 2007 Earnings per income statement 2,267 1,051(£'000)Weighted average number ofordinary shares (000's) 75,000 75,000 Basic and diluted earnings 3.0p 1.4pper share The warrants issued to the investment manager (note 15) could potentially dilutebasic earnings per share in the future. The average share price over the period is lower than the exercise price of thewarrants and therefore these are not dilutive. 8. Net asset value per share 31 December 2007 30 June 2007 Net asset value (£'000) 74,338 73,121Number of ordinary shares (000's) 75,000 75,000 Net asset value per share 99.1p 97.5p 9. Investment in subsidiary undertakings A list of the significant investments in subsidiaries, including the name,country of incorporation and the proportion of ownership interest is givenbelow. Name of subsidiary undertaking Class of share % of class held Country of Principal with voting incorporation activity rights Alpha Tiger Cyprus Holdings Limited Ordinary 100 Cyprus Holding Company The Company has invested £2,600,000 in 20,935 redeemable preference shares ofINR1 each at a premium of INR 9,999 each in Alpha Tiger Cyprus Holdings Limited.The shares are redeemable at any time by the Company with each share beingredeemed at the initial issue price. The shares carry no right to income. The Directors do not intend to request redemption of the preference shareswithin one year and accordingly these shares have been classified as anon-current amounts receivable from the subsidiary undertaking. 10. Categories of financial assets and liabilities Notes Loans and Receivables Group Company £'000 £'000Non-current financial assetsAmounts receivable from 9 - 2,658subsidiaryTotal non-current financial - 2,658assets Current financial assetsTrade and other receivables 11 791 791Cash and cash equivalents 74,104 71,504Total current financial assets 74,895 72,295Total financial assets 74,895 74,953 Notes Financial liabilities measured at amortised cost Group Company £'000 £'000Current financial liabilitiesTrade and other payables 12 557 557Total current financial liabilities 557 557 11. Trade and other receivables Group Company £'000 £'000 Accrued bank interest 112 112Other debtors 679 679Total 791 791 Other debtors include a fully refundable deposit paid to Xansa plc in relationto the execution of the framework agreement (£500,000) and associated deferredcosts. No trade and other receivables were impaired during the period. The Directorsconsider that the carrying amount of trade and other receivables approximatetheir fair value. 12. Trade and other payables Group Company £'000 £'000 Accruals 189 189Investment Manager's fee payable 368 368Total 557 557 Trade and other payables comprise amounts outstanding for trade purchases andongoing costs. The Group has financial risk management policies in place toensure that all payables are paid within the credit time frame. The Directorsconsider that the carrying amount of trade and other payables approximate theirfair value. 13. Share capital Number of shares £'000AuthorisedOrdinary shares of no par value Unlimited - Issued share capitalAt 15 May 2006 - -Ordinary shares of no par value issued in the 75,000,000 -periodAt 31 December 2007 75,000,000 - The Company has one class of ordinary share which carries no right to fixedincome 14. Reserves The movements in the reserves for the Group and the Company are shown in theGroup and Company Statements of Changes in Equity. Share Premium On 12 January 2007 the Royal Court of Guernsey confirmed the reduction ofcapital by way of cancellation of the amounts standing to the credit of itsshare premium account on that date. The amount cancelled was credited to thespecial reserve. Special reserve The special reserve is a distributable reserve to be used for all purposespermitted under Guernsey company law, including the buy- back of shares andpayment of dividends. Warrant reserve The warrant reserve contains the fair value of share-based payments in respectof the warrants issued to the Investment Manager but not exercised. Revenue reserve Any surplus arising from net profit after tax is taken to this reserve, whichmay be utilised for the buy-back of shares and payment of dividends. 15. Share based payments Warrants The Company has issued warrants to the Investment Manager pursuant to which ithas been granted the right to subscribe for 3,750,000 ordinary shares in theCompany at an exercise price of £1 per share. Such warrants can be exercised atany time up to and including 21 December 2011. The warrant instrument providesthat the holder of the warrant may from time to time transfer all or some of itswarrants to third parties. The fair value of the warrants at grant date has been measured as £39,553 usingan appropriate option pricing model. In light of the immaterial amount of thefair value the directors do not consider it worthwhile to disclose theassumptions used in determining this fair value. As noted above, the Grouprecognised a charge of £39,553 in respect of the warrants; this charge was takento the share premium account. The weighted average exercise price of outstanding warrants at 31 December 2007was £1.00, with a weighted average remaining contractual life of 4 years. 16. Events after the balance sheet date On 3 December 2007, the Company announced it had entered into an agreement toacquire a 74 per cent. equity interest in a business park project (LogixTechnova) in NOIDA Sector 132.. The Company together with Logix, one of theleading developers of business parks in North India , will develop approximately575,000 sq. ft. of business park and other support facilities at the site. Theanticipated cash commitment of the Company is £11.5 million. Subsequent to theyear- end and further to the satisfaction of certain conditions precedent, AlphaTiger has invested £5.1 million. On 25 March 2008, Alpha Tiger announced a further transaction at NOIDA in Sector140a to co-develop with Logix approximately 1.2 million square feet of businesspark-led space in an SEZ and representing a cash commitment of £14.7 million fora 50% interest in the total development. 17. Related party transactions Parties are considered to be related if one party has the ability to control theother party or exercise significant influence over the other party in makingfinancial or operational decisions. Alpha Real Capital LLP is the InvestmentManager to the Company under the terms of the Investment Manager Agreement andis thus considered a related party of the Company. The Investment Manager is entitled to receive a fee from the Company at anannual rate of 2 per cent of the net assets of the Company, payable quarterly inarrears. The Investment Manager is also entitled to receive an annualperformance fee calculated with reference to total shareholder return ("TSR"),whereby the fee is 20 per cent of any excess over an annualised TSR of 15 percent subject to a rolling 3 year high water mark. Details of the Investment Manager fees for the current accounting period aredisclosed in note 4 and the balance payable at the balance sheet date is shownin note 12. The Investment Manager has also been issued warrants over the Company's ordinaryshare capital, further details of which are provided in note 15. The Directors of the Company received fees for their services with a totalcharge to the income statement during the period of £113,316. Further detailsare provided within the Directors Report. The Investment Manager received payment of £300,000 in respect of time costs andexpenses incurred by the Investment Manager in connection with the initialplacing and admission to AIM. Pacific Investments Plc, a company controlled by Sir John Beckwith, who alsocontrols the Investment Manager, was paid £150,000 in respect of theirprofessional costs and expenses in connection with the initial placing andadmission to AIM. Pacific Investments Plc owned 457,000 shares in the Company at31 December 2007. The following, being partners of the Investment Manager, held the followingshares in the Company at 31 December 2007: Number of shares heldSir John Beckwith 1,000,000P. Rose 200,000M. Johnson 50,000B. Bauman 50,000S. Wilson 2,500 18. Financial instruments risk exposure and management In common with similar businesses, the Group is exposed to risks that arise fromits use of financial instruments. This note describes the Group's objectives,policies and processes for managing those risks and the methods used to measurethem. Further quantitative information in respect of these risks is presentedthroughout these financial statements. Principal financial instruments The principal financial instruments used by the Group and Company from whichfinancial instrument risk arises, are as follows: • Amount receivable from subsidiary undertaking • Trade and other receivables • Cash and cash equivalents • Trade and other payables The Group and Company held no derivative instruments during the period ended 31December 2007. General objectives, policies and processes The Board has overall responsibility for the determination of the Group's riskmanagement objectives and policies and, whilst retaining ultimate responsibilityfor them, it has delegated the authority for designing and operating processesthat ensure the effective implementation of the objectives and policies to theGroup's finance function. The overall objective of the Board is to set polices that seek to reduce risk asfar as possible without unduly affecting the Group's competitiveness andflexibility. The above financial instruments risk exposure and managementpolicies apply equally to the Group and Company. Further details regarding thesepolicies are set out below. Credit risk Credit risk arises when a failure by counter parties to discharge theirobligations could reduce the amount of future cash inflows from financial assetson hand at the balance sheet date. a) Group The Group's credit risk principally arises from cash and cash equivalents. TheGroup policy is to maintain its cash and cash equivalent balances with a numberof financial institutions as a means of diversifying credit risk. The Groupmonitors the placement of cash balances on an ongoing basis and has policies tolimit the amount of credit exposure to any financial institution. b) Company The Company's credit risk principally arises from amounts due from subsidiaryundertakings and cash and cash equivalents. The Company follows the same grouppolicy with regards to diversification of banking arrangements. Amountsreceivable from subsidiaries are of a long term nature and the loans aremonitored on a regular basis. The Group and Company's maximum exposure to credit risk by class of financialinstrument is shown below: Group Group Company Company £'000 £'000 £'000 £'000Maximum Exposure Carrying Value Maximum Exposure Carrying Value Maximum ExposureAmount receivable fromsubsidiary undertaking - - 2,658 58Trade and other receivables 791 791 791 791Cash and cash equivalents 74,104 74,104 71,504 71,504 Total 74,895 74,895 74,953 74,953 Liquidity risk Liquidity risk is the risk that arises when the maturity of assets andliabilities does not match. An unmatched position potentially enhancesprofitability, but can also increase the risk of losses. The Group hasprocedures with the object of minimising these risks such as maintainingsufficient cash and other highly liquid current assets. Cash and cashequivalents are placed with financial institutions on a short term basisreflecting the Group's desire to maintain a high level of liquidity in order toenable timely completion of investment transactions. All of the Group and Company's financial liabilities are repayable within oneyear. Market risk a) Foreign exchange risk The Group intends to operate in India and will be exposed to foreign exchangerisk arising from various currency exposures, primarily with respect to Sterlingand Indian Rupees. Foreign exchange risk arises from future commercialtransactions, recognised monetary assets and liabilities and net investments inforeign operations. At 31 December 2007 the Company had a small foreign exchange exposure in Rupeesin relation to the loan given to the Subsidiary. The Group had no exposure toRupees as all of the Group's financial assets and liabilities are denominated inSterling. b) Cash flow and fair value interest rate risk The Group and Company interest rate risk arises from the following financialassets and liabilities. Interest Rate Profile Weighted average interest rate Group Group Company CompanyAs at 31 December 2007 % £'000 % £'000Amounts receivable fromsubsidiary undertakingsNon interest bearing - - - 2,658 Trade and other receivablesNon-interest bearing - 791 - 791 Cash and cash equivalentsVariable rate % 5.7 74,104 5.7 71,504 Financial liabilities carriedat amortised costTrade and other payablesNon-interest bearing - 557 - 557 The Group and Company's cash flow is periodically monitored by the Board. The sensitivity analysis below is based on a change in an assumption whileholding all other assumptions constant. In practice, this is unlikely to occur,and changes in some of the assumptions may be correlated - for example,changes in interest rate and changes in market value. For the Group, an increase of 100 basis points in interest yields would resultin an increase in post-tax profits of £741,000. A decrease of 100 basis pointsin interest yields would result in a decrease in post tax profits of £741,000. For the Company, an increase of 100 basis points in interest yields would resultin an increase in post-tax profits of £715,000. A decrease of 100 basis pointsin interest yields would result in a decrease in post tax profits of £715,000. Capital risk management The Company's objectives when managing capital are to safeguard the Group'sability to continue as a going concern in order to provide returns forshareholders and benefits for other stakeholders and to maintain an optimalcapital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Company may adjust theamount of dividends paid to shareholders, return capital to shareholders, issuenew shares or sell assets to reduce debt. The Group and Company have no borrowings, accordingly the Group had a nilgearing ratio, but expects to target borrowing levels of between 50-60% of grossassets in due course. All funds are currently held as cash. -------------------------------------------------------------------------------- Directors and Company information Directors: Independent Valuers: Legal Advisors in the UK: David Jeffreys (Chairman) Colliers International (Hong Kong) Norton RoseJeff Chowdhry Limited 3 More London RiversideRoddy Sage Suite 5701 Central Plaza London SE1 2AQPhillip Rose 18 Harbour Road Serena Tremlett Wanchai, Hong Kong Registered Office: Financial and Corporate Advisors: Legal Advisors in India: Regency Court Kinmont Limited FoxMandal LittleGlategny Esplanade FM HouseSt Peter Port 5 Clifford Street A-9, Sector - 9Guernsey London W1S 2LG NOIDA 201301 NCR of DelhiInvestment Manager: Auditors: India BDO Novus LimitedAlpha Real Capital LLP Elizabeth House124 Sloane Street Ruette BrayeLondon SW1X 9BW St Peter Port Bankers in Guernsey: Guernsey GY1 3LL Royal Bank of Scotland International Limited Royal Bank PlaceAdministrator and Secretary: 1 Glategny Esplanade Tax Advisors in the UK: St Peter PortInternational Administration Guernsey GY1 4BQ(Guernsey) Limited Ernst & Young LLPRegency Court 1 More London Place Registrar:Glategny Esplanade London SE1 2AF Computershare Investor Services (ChannelSt Peter Port Islands) Limited Ordnance HouseGuernsey GY1 3CH Tax Advisors in India: 31 Pier Road St Helier BMR Advisors Jersey JE4 8PWNominated Advisor The Great Eastern Centreand Joint Broker First FloorPanmure Gordon (UK) Limited 70, Nehru PlaceMoorgate Hall New Delhi - 110 019155 Moorgate IndiaLondon EC2M 6XB Legal Advisors in Guernsey:Joint Broker Carey OlsenCanaccord Adams 7 New Street St Peter PortCardinal Place Guernsey GY1 4BZ7th Floor80 Victoria Street London SW1E 5JL -------------------------------------------------------------------------------- Shareholder information Further information on the Company, compliant with AIM Rule 26, can be found atthe Company's website: www.alphatigerpropertytrust.com Share Price The Company's Ordinary Shares are listed on the London Stock Exchange andreported daily in the Financial Times. Change of address Communications with shareholders are mailed to the addresses held on the shareregister. In the event of a change of address or other amendment, please notifythe Company's Registrar under the signature of the registered holder. Investment Manager The Company is advised by Alpha Real Capital LLP which is authorised andregulated by the Financial Services Authority in the United Kingdom Financial CalendarFinancial reporting DateNotification of full year 25 March 2008resultsPublication of annual report and 30 April 2008notice of Annual General MeetingAnnual General Meeting 23 May 2008Trading statement (quarter 1) 30 May 2008Half Yearly Report 25 September 2008 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Alpha Real