Invest In India, India M&A , Doing Business in India, India Regulatory, India Tax 2013, Setting up Business in India, India Macro Economy Data, Real Estate India, India Automobile Sector, India Entry Strategy, India FDI Regulation, M&A India, Key Sectors India, India Capital Goods ,India Pharmaceutical, India FMCG Sector, India Power Sector,About RCS, RCS Capital Advisors, Key Sector updates India

1. Investing in India
May 2013

2.  India is the 7th largest country in the world by area and is ranked as the 3rd largest economy in the
world when taking Purchasing Power Parity as the measurement index.
 For the financial year 2012-13 India’s GDP grew at 5.0 per cent vs. 6.2 per cent in financial year
2011-12. Government of India is targeting average growth rate of 8 per cent over the next five years
(2012-17).
 National Stock Exchange (NSE) is the 2nd fastest growing exchange and 9th largest stock exchange in
the world by market capitalization USD 1.28 trillion as of January, 2013.
 India has emerged as an important investment destination with cumulative foreign investment inflow in
India has reached USD 287.12 billion as on February, 2013.
 Government plans USD 1 trillion spending on infrastructure in the 12th Plan period (2012-2017).
 Indian Government is focusing on skill development and has mandated National Skills Development
Corporation (NSDC) to create an ecosystem of vocational training institutions that will create150
million job ready workforce by 2022.
 Total M&A and private equity deals in the month of February 2013 were valued at USD 2.75 billion as
compared to USD 15.45 billion and USD 8.15 billion in corresponding months of 2012 and 2011
respectively.
INDIA OVERVIEW
Source: Economic Survey 2012-13

3. India’s GDP Growth Leading GDP Per Capital (PPP) – India and China
India Foreign Exchange Reserves Balance of Payment (USD Billion)
INDIAN ECONOMY AT GLANCE
249.07
253.98
257.77
261.29
260.08
253.36
256.84
240
245
250
255
260
265
Oct/12 Nov/12 Dec/12 Jan/13 Feb/13 Mar/13 Apr/13
USDBillion
Source: Reserve Bank of India, www.tradingeconomics.com
950
1,241 1,224
1,362
1,684
1,841 1,878
2,180
0
500
1,000
1,500
2,000
2,500
FY07 FY08 FY09 FY10 FY11 FY12 FY13E FY14E
USDBillion
Source: India Macroscope, Citi Research
166.16
189.00 182.44
256.16
309.77
291.20
257.63
308.52 300.64
383.48
499.53
479.60
0
100
200
300
400
500
600
FY08 FY09 FY10 FY11 FY12 FY13E
USDBillion
Exports Imports
6201.64
6809.64
7567.84
8442.23
2861.12
3086.02
3372.66
3649.53
0
1000
2000
3000
4000
5000
6000
7000
8000
9000
2009 2010 2011 2012
China India

4. Index of Industrial Production Credit Growth in Key Sector (Per cent)
Indian Central Bank’s Interest Rate
INDIAN ECONOMY AT GLANCE
51.5
1,090
1,061
25.1
16.7
29.0
33.8
14.9 18.5 20.0
24.6
27.4 29.9
25.0
19.6
18.2
20.5 21.4 20.8
19.2
0
10
20
30
40
50
60
H1 H2 H1 H2 H1
Electricity Cement Basic Metal Manufacturing
Source: Mid Year Economic Analysis 2012-13
FY 2012-13FY 2011-12FY 2010-11
Trends in growth of key sectors
5.5
8.1
9.3
4.7
-0.3
1.2
-4.8
8.38.9
7.0
9.5
2.6
11.9
1.0
5.1
-0.8
4.5
6.7
3.8
7.4
-6
-4
-2
0
2
4
6
8
10
12
14
2010-11 2011-12 2011-12* 2012-13*
Electricity Coal Steel Crude Oil Cement
Source: Mid Year Economic Analysis 2012-13
* April – September
179.4 181.8 176.2
157.6 160.7
140.5
191.2 193.4 190.9
132.2 135.0
124.0
0.00
50.00
100.00
150.00
200.00
250.00
Dec/12 Jan/13 Feb/13
General Electricity Manufacturing Mining
Source: Ministry of Finance, Department of Economic Affairs, Economic Division – INDIA
7.25%
7.50%
8.00%
8.25%
8.50%
8.00%
7.75%
7.50%
7.25%
6.60%
6.80%
7.00%
7.20%
7.40%
7.60%
7.80%
8.00%
8.20%
8.40%
8.60%
May
2011
Jun
2011
July
2011
Sep
2011
Oct
2011
Apr
2012
Jan
2013
Mar
2013
May
2013

5. India Savings Rate (% of GDP) Indian Inflation Scenario
Indian Govt. Debt to GDP (%)
Source: Planning Commission, Govt. of India
7.55
8.07
7.24 7.18
6.62 6.84
5.96
0
1
2
3
4
5
6
7
8
9
Oct/12 Nov/12 Dec/12 Jan/13 Feb/13 Mar/13 Apr/13
36.8
32.0
33.7 34.0
30.8 31.0
32.4
27
28
29
30
31
32
33
34
35
36
37
38
2008 2009 2010 2011 2012 2013E 2014E
75.440
74.724 74.973
69.427
68.053
67.570
62.00
64.00
66.00
68.00
70.00
72.00
74.00
76.00
78.00
2008 2009 2010 2011 2012 2013*
* Till April 2013
Foreign Direct Investment (USD Billion)
34.843
41.873
37.745
34.847
46.553
33.912
0
5
10
15
20
25
30
35
40
45
50
2008 2009 2010 2011 2012 2013*
* Till Feb 2013
INDIAN ECONOMY AT GLANCE

6. REGULATORY FRAMEWORK
Investing in India
Financial Investors
(FII or FVCI)
Invest in a Company with a services fulfillment
subsidiary in India
Invest in a Tax Haven with a services fulfillment
subsidiary in India
Direct investment in an Indian company from outside
India (Tax Havens)
Direct investment in an India company from outside
India through a venture capital fund registered with
SEBI
Strategic Investor (FDI)
Operate as a
Foreign company
Liaison Office
Branch Office
Project Office
Operate as an
Indian Company
Wholly owned
subsidiary
Private
Public
Joint Venture
INDIA ENTRY STRATEGY

7. REGULATORY FRAMEWORK
INDIA ENTRY STRATEGY
− No prior permission required. Only requirement to inform Central Bank (‘Reserve
Bank of India’) within 30 days of inflow / issue of shares
Government Approval Route
− Prior government (i.e Foreign Investment Promotion Board) (‘FIPB’) approval needed.
The approval required for FDI in the following cases:
− Where provisions of Press Note 1(2005 Series) are attracted; or
− Proposals for foreign equity beyond 24% in MSE reserved sector; and
− Proposals falling outside notified sectoral policy/caps
− Decision generally communicated within 6-8 weeks intimation as mentioned in
automatic approval route still needs to be complied with
Automatic Route
FDI in India can be undertaken through two routes:

8. REGULATORY FRAMEWORK
FDI REGULATIONS – KEY SECTORS
Sector/Activity FDI Cap Entry Route Note
Infrastructure including Power, Roads, Ports 100% Automatic
Subject to provisions of the Electricity Act, 2003,
NHAI Guidelines, and other sectors specific
regulations
Drugs & Pharmaceuticals including those involving
use of recombinant DNA technology
100% Automatic
Banking - Private sector 74% (FDI+FII) Automatic
Subject to guidelines for setting up branches/
subsidiaries of foreign banks issued by RBI.
Non Banking Finance Companies 100% Automatic
Minimum capitalization norms exist for various
kinds of NBFCs for fund based/non fund
based/JVs etc.
Construction Development projects
Note: Not allowed in Real Estate Business
100% Automatic
Subject to certain conditions related to minimum
capitalization
Petroleum & Natural Gas sector: Refining
49%(PSUs)
100%(Private)
FIPB (PSUs)
Automatic
(Private)
Subject to Sectoral policy and no divestment or
dilution of domestic equity in the existing PSUs
Print Media: Publishing of newspaper/ periodicals
dealing with news & current affairs
26% FIPB
Subject to Guidelines notified by Ministry of
Information & Broadcasting
Retail & trading
100% (C&C)
100% (Single
brand)
51% (Multi brand)
Automatic (C&C)
FIPB (Single
brand)
FDI in single brand product retail trading is
subject to certain conditions.
Telecom
A) Basic/Cellular
B) Passive Infrastructure
C) Telecom Equipment
A) 74%
B & C) 100%
A&B) Automatic
up to 49%.
FIPB beyond
C) Automatic
Subject to various conditions and sectoral caps

9. REGULATORY FRAMEWORK
M&A in INDIA
Acquisition in India
Stock Sale Business Sale
Unlisted Company Listed Company
Asset Sale
(Piecemeal Asset Sale)
Slump Sale
(Sale as going concern)
− Companies Act (sec 391-
394, Minority
shareholder’s rights at
25%)
− Sale of shares entails
income tax @ 10% after
one year
− Companies Act (sec 391-
394, Minority
shareholder’s rights at
25%)
− SEBI Takeover Code
− SEBI insider trading
guidelines
− SEBI Issue Of Capital
and Disclosure
Requirements Regulations
− Corporate governance
− NIL capital gains tax for
shares sold on the floor
of stock exchange after
one year
− For off-market
transaction, capital gain
tax is 20% with indexation
and 10% without
indexation
− Companies Act
(shareholder approval by
simple majority)
− Stamp duty
− Sales tax, VAT
− Income tax (capital gains
@ 30% of gain over tax
WDV)
− Companies Act
(shareholder approval by
simple majority)
− Stamp duty
− Income tax (capital gains
@ 20% of gain over
networth of division used
for more than 2 years)

10. REGULATORY FRAMEWORK
M&A in INDIA
Type Schematic Description Comments
Stock (listed and
unlisted
companies)
− Key approval would be Central Government
(FIPB) approval, if applicable
− In case of a listed company, an acquisition
would trigger the requirement that the buyer
make a public tender offer as per the SEBI
takeover code
− The acquisition price would be driven by the
market price in addition to the negotiated
price in the case of a listed target company
Asset
− Piecemeal sale of assets allows buyer to pick
and choose. Buyer can choose to pick
employees potentially with fresh contracts
− Regulatory claims would typically stay with
owner Company. However certain assets
linked claims (Factories act, environment
related) would move to the buyer company.
Slump
− Target business sold as a going concern.
Allied assets, liabilities, people etc. also move
− Assets values not identified for each asset
and hence need to be allocated on a fair value
basis in the buyer’s balance sheet
− Typically liabilities related to people, income
tax, sales tax and excise etc. move with the
going concern
− Typically, litigation stays with owner
company

11. REGULATORY FRAMEWORK
KEY REGULATION THAT AFFECT M&A in INDIA
Regulation / Regulator Key area of influence / Regulation
Foreign Direct Investment Policy
− Dept of Industrial Policy & Promotion, Foreign Investment
Promotion Board (FIPB)
− Reserve Bank of (RBI) – Exchange Control Department
− Investment in existing entities may require FIPB and RBI
approvals, if the particular sector is subject to foreign investment
restrictions
− Valuation benchmarks when a non-resident is acquiring/selling
shares from/to a resident
Takeover Regulations
− Securities and Exchange Board of India
− Tender offer requirements for acquiring shares/control of a listed
company
− Pricing is linked to historical and prevailing market price as well as
the negotiated deal
Delisting Regulations
− Securities and Exchange Board of India
− For delisting a company from all stock exchanges and taking the
company private
− Pricing is determined by reverse book-building by the
shareholders of the company
Competition Regulations
− Competition Commission of India (CCI)
− Post M&A transaction, if an entity exceed particular combined
limit of assets or turnover, an approval from commission may be
required
Initial Public Offer Regulations
− Securities and Exchange Board of India
− Initial public offer / follow-on offering requirements by a
listed/unlisted company to the public

12. REGULATORY FRAMEWORK
KEY REGULATION THAT AFFECT M&A in INDIA
Regulation / Regulator Key area of influence / Regulation
Companies Act
− (Relevant) High Court
− Registrar of Companies and Department of Company Affairs
− Implementing a Scheme of Merger or Demerger or any hybrid
arrangements
− Matters requiring approval of shareholders (simple majority and
super majority)
− Permissible instrument types
Stamp Duty Act, Sales Tax Act
− Registrar of Stamps, in the respective state government,
(relevant) state/central authorities
− Transaction cost implications of a proposed structure, especially
if relevant state Stamp Act is ambiguous on a certain proposed
structure
Income Tax Act
− Income Tax Department, Ministry of Finance
− Tax implications of a proposed structure especially treatment of
capital gains
− Corporate tax rate in is 32.23%
− Capital gain from sale of equity shares exempt from tax if shares
are held for more than one year and sold on the floor of the Stock
Exchange
Other Regulations
[Continued Listing, Corporate Governance, etc.]
− Securities and Exchange Board of India
− Dealing with and conditions relating to public shareholding, and
corporate governance requirements of existing and to-be-listed
companies

13. Pharmaceutical
Infrastructure
Capital GoodsFMCG & Retail
Power
Automotive
Key Sectors
KEY SECTORS

14.  Indian Automotive Industry is expected to be
the world’s 7th largest automobile market by
2016 and the 3rd largest by 2030.
 Indian Two Wheeler Industry is the 2nd largest
in the world after China.
 Strong demand growth due to rising incomes,
growing middle class, and a young population
is likely to propel India among the world’s top
five auto - producers by 2015.
 The industry turnover is estimated to reach
USD 145 billion by 2016.
 India has significant cost advantages; auto
firms save 10-25 per cent on operations in
India compared to Europe and Latin America.
 India has a large pool of skilled manpower and
a growing technology base.
 Government aims to develop India as a global
manufacturing as well as R&D hub.
0.3
0.5 0.5 0.5
0.04 0.04 0.08 0.1
0.2 0.2
0.3
0.4
1.0
1.1
1.5
2.0
0.00
0.50
1.00
1.50
2.00
2.50
2008-09 2009-10 2010-11 2011-12
Exports of Automobile from India (Mn units)
Passenger Vehicle Commerical Vehicle Three Wheelers Two Wheelers
Indian Automotive Clusters
AUTOMOBILE
Source: IBEF, SIAM

15. 27.9
31.3
45.3
38.3
58.1
67.1
0
10
20
30
40
50
60
70
80
FY 07 FY 08 FY 09 FY 10 FY 11 FY 12
India’s growing engineering exports (USD billion)  The Indian engineering industry accounts for
27 per cent of the total factories in industrial
sector and represents 63 per cent of the overall
foreign collaborations.
 Indian engineering exports stood to at USD
67.1 billion in FY12 as compared to USD 58.1
billion in FY11.
 Over the period FY07-12, exports from the
sector have posted a CAGR of 19.2 per cent.
 Under the 12th five year plan the demand for is
projected to grow at an average CAGR of 15
per cent.
 Cumulative projects pipeline building up of
over USD 72 billion of government projects to
be awarded in the 12th five year plan.
 Key policy initiatives aimed at accelerating the
investment spend such as:
− Development of Delhi Mumbai Industrial
Corridor
− 1500 kms to be awarded in FY14 under the
Dedicated Freight Corridor Corporation
CAPITAL GOODS
Source: IBEF, Department of Heavy Industries – Report of working group on capital goods and engineering sector for 12th five year plan
236.78 130.96
452.32
3016.62
232.5 301.18
2806.04
317.83
0
500
1000
1500
2000
2500
3000
3500
Machine
Tools
Plastic
Machinery
EMM* HEE** Metallurgical Process Plant Engineering
Sector
Dies and
Moulds
Projected Market Size by FY 2016-17 (USD billion)
*EMM – Earthmoving and Mining Machinery
**HEE – Heavy Electrical Equipment

16.  India is the 5th largest producer and consumer of
electricity in the world after China, US, Russia
and Japan.
 Indian power sector is one of the key sectors
attracting FDI inflows into India; inflows
recorded at CARG of 63 per cent during FY 06-
12.
 Aggregated capacity addition of 20,334 MW
have been planned during the XIIth Five Year
Plan (2012-17).
 Government of India is planning 9 Ultra Mega
Power Projects of 4 GW each with an estimated
investment of USD 36 billion.
 National Grid is being developed and is
estimated to have a capacity of 200,000 MW and
an inter-regional transmission capacity of 37,000
MW by 2012.
 100 per cent FDI is allowed in Indian Power
Sector (except under nuclear segment).
 Government policy and support:
− Elimination of licensing for various
segments, removal of entry barriers
− Cost reduction and rationalization of tariffs;
development of Ultra Mega Power Projects
− Fuel supply agreement of power producers
with Coal India
40.77%
29.73%
29.49%
Total Installed Capacity by Sector
State
Central
Private
4,780
39,416
25,856
141,714
0
20000
40000
60000
80000
100000
120000
140000
160000
Nuclear Hydro RES* Thermal
Installed capacity in MW (as on Jan 31st, 2013)
POWER
Source: IBEF
*RES – Renewable Energy Source

17.  Infrastructure sector in India has been
witnessing rapid growth in its different
segments with the growing urbanization.
 National Highways Authority of India alone
has awarded 17 projects worth USD 5.15
billion.
 USD 1 trillion worth of expenditure in
infrastructure is estimated over the next five
years (FY 13-17).
 Investment of USD6.4 billion is expected in
constructing roads, bridges and bypasses in
FY13.
 Roads and bridge infrastructure industry to be
worth USD 19 billion by FY17.
 Road infrastructure is a key government
priority; the sector has received strong
budgetary support over the years.
 Encouragement to private sector participation;
relaxation of foreign investment norms.
 FDI of up to 100 per cent is allowed under the
automatic route in most asset class.
7
8
9 9
11
13
16
19
0
2
4
6
8
10
12
14
16
18
20
FY 10 FY 11 FY 12 FY 13F FY 14F FY 15F FY 16F FY 17F
Roads/Bridges infrastructure value in India
(USD billion)
INFRASTRUCTURE
Source: IBEF
2.84
3.48
3.18
5.6
6.4
0
1
2
3
4
5
6
7
FY 09 FY 10 FY 11 FY 12 FY 13
Outlay for roads under respective Union Budgets (USD billion)
Road transport and highways

18.  India is 3rd largest market in the world in terms
of volume and 14th in terms of value.
 Indian pharmaceutical industry sales stood at
USD 15.6 billion during FY 2011 and is
projected to reach USD 55 billion by FY 2020.
 Pharma exports from India are forecasted to
double over the next five years. The trade
surplus in pharma sector is likely to expand to
USD 16.5 billion by FY 2016.
 India has 120 US FDA approved plants in
addition to 84 UK MHRA approved plants.
 India rates higher than other countries on cost
efficiency. Cost efficiency continues to create
opportunities for pharma companies in
emerging markets and Africa.
 Indian pharmaceutical companies are scaling up
the value chain by focusing on innovation.
 By 2017, government plans to provide free
generic medicines to half the population at an
estimated cost of USD 5.4 billion.
 Government is also sponsoring programmes
set to provide health benefits to over 380
million people by 2017.
6.57
12.96
24
55
0
10
20
30
40
50
60
2005 2010 2015 2020
Indian Pharma market is expected to grow to $ 55 Billion by 2020
PHARMACEUTICAL
Source: IBEF
3.9
5.1
6.1
7.0
8.6
10.7
13.3
0
2
4
6
8
10
12
14
2009 2010 2011 2012 2013F 2014F 2015F
Pharma exports from India (USD billion)

19.  India is among the world’s youngest nations,
with a median age of 25 years as compared to
43 in Japan and 36 in the US.
 India is poised to become the world’s 5th largest
consuming country by 2025.
 Food products is the largest consumption
category in India, accounting for nearly 21 per
cent of the country’s GDP.
 India is recognized as a cost-effective quality
manufacturing base in the world market.
 India’s consumer class is estimated to grow
~12x with more than 23 million people likely to
be listed among the world’s wealthiest citizens.
2%
12%
43%
8%
4%
4%
5%
22%
Indian FMCG market Segments
Baby Care Fabric Care Food Products Hair Care
Household OTC Products Others Personal Care
25
43
74
0
10
20
30
40
50
60
70
80
2008 2013 E 2018 E
Market Size ($ Bn)
FMCG
Source: IBEF

20. 350.20
425.00
825.00
0
200
400
600
800
1000
2009 2010 2014 E
Indian Retail market ($ Bn)
62%
10%
8%
6%
4%
4%
3%
2%
1%
Market Segment
Food
Fashion
Fashion accessories
Leisure & Entertainment
Consumer Durables
Health & Beauty
Furniture
Telecom
Books
RETAIL
Source: IBEF
 Indian Retail market size is estimated at USD
425 billion and is projected to grow at 25 per
cent per annum to reach USD 825 billion by
2015.
 Food is the largest segment in terms of its
contribution to the total value of the retail
market, followed by fashion and fashion
accessories.
 Indian luxury retail market is expected to grow
to USD 30 billion by 2015, making it the 12th
largest luxury retail market in the world.
 With the rise in disposable income and
increasing urbanization, the number of luxury
goods consumers in India is increasing rapidly.

21. RCS Advisors is a leading strategy and investment advisory firm, which focuses on cross border
M&A and investment related activities.
RCS Advisors is built on a rigorous intellectual platform and a truly broad global network, and
reinforced by clients' trust accumulated over years of unbiased board room advices.
Founded in 2002, RCS has advised leading industrial groups in India like Aditya Birla Group,
TATA Group, Larsen & Toubro, Godrej Industries, Kalyani Group for their overseas ventures
and foreign clients like Sany Heavy Industries, Weichai Power, Johnson Controls, Sinoma,
Edelmann, Metalsa for their India investments.
We operate under the principal that the trinity of financial, strategy and operational advice
delivered by the same advisor can unlock vast economic value and stimulate optimal performance
for our clients. Our client relationships are among our greatest competitive assets. We deepen and
enrich these relationships through disciplined growth, innovation, and seamless execution.
RCS joined Asia M&A Group in 2011 to strengthen its reach in major Asian economies like
Australia, China, Indonesia, Japan, Korea, Singapore and Vietnam.
ABOUT Us

22. Contact Us:
RCS Advisors (India) Pvt. Ltd.
407 Winners Court, 23 Lullanagar Cross,
Kondhwa, Pune 411040
INDIA
Tel: +91-20-26837941
Fax: +91-20-26835981
Email: pune@rcsadvisors.in