IRB InvIT Fund Directors Report.

ACTIVITIES OF THE TRUST

IRB InvIT Fund ("the Trust") has been settled by IRB Infrastructure Developers Limited (the "Sponsor") pursuant to the Indenture of Trust in Mumbai, India, as an irrevocable trust in accordance with the Trusts Act. The Trust has been registered with SEBI as an infrastructure investment trust under the Securities and Exchange Board of India (Infrastructure Investment Trusts) Regulations, 2014 ("the InvIT Regulations") (Registration Number: IN/InvIT/15-16/0001). The object and purpose of the Trust is to carry on the activity of an infrastructure investment trust under the InvIT Regulations, to raise resources in accordance with the InvIT Regulations, and to make investments in accordance with its investment strategy.

The Trust own, operate and maintain a portfolio of seven toll-road assets in the Indian states of Maharashtra, Gujarat, Rajasthan, Karnataka, Tamil Nadu and Punjab. These toll roads are operated and maintained pursuant to concessions granted by the NHAI. The Trust is listed on both the Stock exchanges i.e. National Stock Exchange of India Limited and BSE Limited since May 18, 2017.

FINANCIAL STATEMENTS

The Summary of financial information on Consolidated & Standalone Financial Statement of the Trust as on March 31, 2018 are as follows:

(Rs in lakhs)
Particulars

Consolidated

Standalone

Year ended

Year ended

Year ended

Year ended

March 31, 2018

March 31, 2017

March 31, 2018

March 31, 2017

Total Income 100,515.78 - 51,568.95 -
Total Expenditure 77,239.90 0.02 7,546.97 0.02
Profit before tax 23,275.88 (0.02) 44,021.98 (0.02)
Less: Provision for tax
Current tax 33.61 - - -
Profit after tax 23,242.27 (0.02) 44,021.98 (0.02)
Add: Profit at the beginning of the year (0.02) - (0.02) -
Profit available for appropriation 23,242.25 (0.02) 44,021.96 (0.02)
Appropriations:
Unit Issue Expenses (9,891.70) - (9,891.70) -
Interest Distribution (31,637.25) - (31,637.25) -
Other comprehensive income/(loss) for the period 6.26 - - -
Balance Carried Forward to Balance Sheet 18,280.44 (0.02) 2,493.01 (0.02)

MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis forms a part of the Annual Report.

ASSETS OF THE TRUST

Project wise brief details of the assets of the Trust:

(Rs in lakhs)
Particulars

IDAA Infrastructure Limited

IRB Surat Dahisar Tollway Limited

IRB Talegaon Amravati Tollway Limited

IRB Jaipur Deoli Tollway Limited

IRB Tumkur Chitradurga Tollway Limited

M.V.R. Infrastructure and Tollways Limited

IRB Pathankot Amritsar Toll Road Limited

(IDAA)

(IRBSD)

(IRBTA)

(IRBJD)

(IRBTC)

(MVR)

(IRBPA)
Concession period 15 12 22 25 26 20 20
(in years)
Concession start date January 2, 2007 February 20, 2009 September 3, 2010 June 14, 2010 June 4, 2011 August 14, 2006 December 30, 2010
Tolling start date September 25, 2009 February 20, 2009 April 24, 2013 September 27, 2013 June 4, 2011 August 14, 2006 November 27, 2014
Total project cost 140,549.00 252,857.40 89,259.50 177,469.60 114,200.00 30,759.90 144,531.00
(Rs in lakhs)
No. of Toll plazas 1 4 1 2 2 1 2
Km Length 65.00 239.00 66.73 148.77 114.00 68.63 102.42
Lane Km 390.00 1,434.00 267.00 595.00 684.00 275.00 410.00
State Gujarat Gujarat Maharashtra Rajasthan Karnataka Tamil Nadu Punjab
National Highway NH 8 NH 8 NH 6 NH 12 NH 4 NH 7 NH 15

The Trust has not invested in under-construction projects.

During the period, the Trust has acquired seven project assets from its sponsor, IRB Infrastructure Developers Limited and its Associates (six Projects acquired on May 9, 2017 and one Project on September 28, 2017). There was no divestment of assets during the period.

Details of enterprise value and payment to selling shareholders towards equity are as follows:

(Rs in lakhs)
Particulars

Six project assets* acquired through

Public Issue

Enterprise value 592,110.00
Consideration (incl. units) to selling shareholders towards Equity
- IRB Infrastructure Developers Limited (incl. units) 101,795.30
- Modern Road Makers Private Limited 4,706.50
- Ideal Road Builders Private Limited 5,151.10
- Aryan Toll Road Private Limited 2,773.70
- ATR Infrastructure Private Limited 3,169.90

* Details of Project assets are provided above

(Rs in lakhs)
Particulars

Pathankot Amritsar project acquired through debt

Enterprise value (net) 156,933.00
Consideration to selling shareholders towards Equity
- IRB Infrastructure Developers Limited 8,918.00
- Modern Road Makers Private Limited 991.00

PROJECT•WISE REVENUE FROM THE UNDERLYING PROJECTS

Details of Project wise revenue from the underlying assets are as follows:

(Rs in lakhs)
Particulars

Quarter ended June 30, 2017*

Quarter ended September 30, 2017

Quarter ended December 31, 2017

Quarter ended March 31, 2018

Total
IDAA 2,921.00 5,096.80 5,688.70 5,796.30 19,502.80
IRBSD 8,932.00 14,678.90 16,867.70 16,865.60 57,344.20
IRBTA 894.00 1,394.50 1,609.80 1,591.50 5,489.80
IRBJD 2,032.00 3,157.10 2,854.50 2,486.90 10,530.50
IRBTC 3,165.00 5,533.10 5,907.20 5,977.30 20,582.60
MVR 1,169.00 2,061.60 2,223.50 2,187.10 7,641.20
IRBPA - 106.60** 3,132.50 2,821.60 6,060.70
Total 19,113.00 32,028.60 38,283.90 37,726.30 1,27,151.80

*Toll collection for Q1 is considered from May 9, 2017 to June 30, 2017.

**Toll collection for IRBPA is considered from September 28, 2017 to September 30, 2017 i.e. date of acquisition.

SUMMARY OF THE VALUATION

The Investment Manager has submitted valuation report for the financial year ended March 31, 2018 as received from Valuer with the Stock Exchanges. The summary of valuation report is provided as "Annexure A".

The Toll Revenue and O&M Cost Projection Report(s) issued by M/s. GMD Consultants - Technical Consultant, for Project SPVs were submitted to the Stock Exchanges.

VALUATION OF ASSETS AND NAV

Statement of Net Assets at Fair Value as at March 31, 2018

Particulars

(Rs in lakhs)

A. Assets 15,01,164.49
B. Liabilities 8,29,341.21
C. Net Assets (A-B) 6,71,823.29
D. Outstanding units 5,805.00
E. NAV at Fair Value (Per Unit) (C/D) 115.73

BORROWINGS

Details of Borrowings or repayment of borrowings on standalone and consolidated are as follows:

(Rs. in Lakhs)
Particulars

Opening Balance

Loan availed during the period

Loan repaid during the period

Closing Balance

Secured loan
Loan from SBI - 105,000.00 199.50 1,04,800.50
Loan from IDFC Bank - 50,000.00 190.00 49,810.00
Total - 155,000.00 389.50 154,610.50

UTILISATION OF IPO PROCEEDS

The total IPO proceeds of Rs 4,74,513.5 lakhs raised by the Trust is utilised as shown below:

(Rs in lakhs)
Particulars

Amount Outstanding as on December 31, 2016

Amount Proposed to be Repaid/ Prepaid

Actual outstanding as on May 18, 2017

Actual utilisation of fresh issue

Paid out of Over subscription proceeds

Repayment/prepayment, in part, of certain loans/facilities availed by the Project SPVs from their respective senior lenders
(a) Loans/facilities availed from senior lenders that are not the GCBRLMs and the BRLM, or associates of the GCBRLMs and BRLM 212,142.30 106,071.10 200,368.40 200,368.40 -
(b) Loans/facilities availed from senior lenders that are the GCBRLMs and the BRLM, or associates of the GCBRLMs and BRLM 139,127.80 68,407.90 135,387.40 90,873.90 44,513.50
(c) Prepayment, in full, of the subordinate debt provided to certain Project SPVs by the Sponsor and the Project Manager 69,850.00 69,850.00 69,850.00 69,850.00 -
(d) Prepayment, in full, of certain unsecured loans and advances availed by certain Project SPVs from the Sponsor, the Project Manager and certain members of the Sponsor group 74,174.30 74,174.30 59,040.60 59,040.60 -
(e) Repayment/prepayment, in part, of the balance portion of certain loans/ applicable facilities availed by the Project SPVs from their respective senior lenders Not 101,496.70 - - -
495,294.40 420,000.00 464,646.40 420,132.90 44,513.50
Add: IPO Expenses incurred upto June 30, 2017 10,000.00 10,000.00 (*) 9,867.10 9,724.80 -
Add: IPO Expenses incurred during the quarter ended September 30, 2017 - - - 142.30 -
Add: Balance Unutilised Portion - - - - -
Total 505,294.40 430,000.00 474,513.50 430,000.00 44,513.50

* The amount includes the amount of provision for IPO expenses.

There are no variations in respect of utilization of net proceeds from the IPO of the Trust as against those stated in the Final Offer Document dated May 12, 2017.

CREDIT RATING

CARE Ratings Limited has assigned "CARE AAA; Stable" to long term bank facilities of Rs 1,55,000 Lakhs availed by the Trust.

INVESTMENT MANAGER

IRB Infrastructure Private Limited is the Investment Manager (IM) of the Trust, and has been designated as such pursuant to the Investment Management Agreement dated March 3, 2016. The Investment Manager is responsible for making investment decisions with respect to the underlying assets or projects of the Trust (Project SPVs), including any further investment or divestment of its assets, in accordance with Securities and Exchange Board of India (Infrastructure Investment Trusts) Regulations, 2014, as amended (the InvIT Regulations) and the Investment Management Agreement.

The details of the Invesment Manager are as follows:

i) Past Experience of the Investment Manager

The Company has adequate net worth, experience, resources and personnel in the development of infrastructure and to perform functions of the Investment Manager. The Board of the Investment Manager comprises of majority of the Independent Directors having extensive experience in Infrastructure Sector and Project financing.

ii) Brief Profiles of the Investment Managers Directors

a) Mr. Rajinder Pal Singh (DIN : 02943155)

Mr. Rajinder Pal Singh, aged 66 years, is an Independent Director and Chairman of the Board of the Investment Manager. He is a retired I.A.S. Officer and has experience in areas of finance, industry and infrastructure development. Previously, he was the chairman and managing director of Punjab & Sind Bank and the secretary to the Department of Industrial Policy and Promotion, Ministry of Commerce and Industry, Government of India. Further, he was the chairman of National Highways Authority of India for a period of three years starting from June 2012. Currently, he is also a director on the board of directors of Maruti Suzuki India Limited, Bharti Infratel Limited and Lodha Developers Limited.

b) Mr. Vinod Kumar Menon (DIN : 03075345)

Mr. Vinod Kumar Menon, aged 52 years is a whole time director & Chief Executive Officer of the Investment Manager. He holds a Bachelor of Technology degree in Civil Engineering. He has experience in the fields of infrastructure development and management. Previously, he was the president (business development) of the Sponsor. He currently also serves as the vice-president of the National Highway Builder Federation – a non profit organisation.

c) Mr. B. L. Gupta (DIN : 07175777)

Mr. B. L. Gupta, aged 63 years, is an independent director of the Investment Manager. He holds a Bachelors degree in commerce and a Master of Business Administration degree. He is a certificated associate of the Indian Institute of Bankers. He has experience in banking, corporate and project finance. Previously, he was the chief general manager of India Infrastructure Finance Company Limited.

d) Mr. Sumit Banerjee (DIN : 00213826)

Mr. Sumit Banerjee, aged 61 years, is an independent director of the Investment Manager. He holds a Bachelor of Technology degree in Mechanical Engineering and has completed a Management Education Programme. He is a fellow and a Chartered Engineer (India) of the Institution of Engineers. He has experience in the fields of management. Previously, he served as the managing director of ACC Limited.

iii) Brief Profiles of the Investment Managers Key Personnel

a) Mr. Vinod Kumar Menon

For details in relation to Mr. Vinod Kumar Menon, see "ii) Brief Profiles of the Investment Managers Directors".

b) Mr. Tushar Kawedia

Mr. Tushar Kawedia, aged 38 years, is the chief financial Officer of the Investment Manager. Previously, he served as the deputy chief financial Officer of the Sponsor group. Mr. Kawedia holds a Bachelors degree in commerce and is a qualified chartered accountant (ICAI). Prior to joining the Sponsor, he was deputy general manager (accounts and finance) at Reliance Infrastructure Limited. He has experience in the fields of accounts and finance.

c) Mr. Urmil Shah

Mr. Urmil Shah, aged 33 years, is the company secretary of the Investment Manager and has been designated as the Compliance Officer by the Investment Manager with respect to the Trust. Previously, he served as the assistant company secretary of the Sponsor. Mr. Shah holds a Bachelors degree in commerce and is an associate of the ICSI. Prior to joining the Sponsor group in 2011, he was part of the secretarial department of Great Offshore Limited. He has several years of experience in secretarial and compliance functions.

iv) Details of the Holding by the Investment Manager and its Directors in the Trust

As on March 31, 2018, as per the disclosures received from the Directors of Investment Manager, except Mr. Sumit Banerjee (holding 10,000 Units), none of the Investment Managers Directors holds any Units of the Trust.

v) Summary of the Standalone Financial Statements of the Investment Manager

The Investment Manager has no subsidiaries. For the summary of the financial statements of the Investment Manager, as derived from the standalone financial statements of the Investment Manager, prepared in accordance with Ind AS and the Companies Act, 2013 as of and for the financial years ended March 31, 2018, please refer website of Investment Manager i.e. www. irbfl.co.in.

During the period, there is no change in the Board of Directors of the Investment Manager.

vi) Codes / Policies

In order to adhere to the good governance practices for the Trust, the Investment Manager has adopted the following policies in relation to the Trust:

Distribution Policy

The Investment Manager has adopted the Distribution Policy as disclosed in Final Offer Document to ensure proper, accurate and timely distribution for the Trust. The Distributable Income of the Trust is calculated in accordance with the Distribution Policy, the InvIT Regulations and any circular, notification or guidance issued thereunder.

Policy on unpublished price-sensitive information and dealing in units by the parties to the Trust (the "UPSI Policy")

The Investment Manager has adopted the UPSI Policy to ensure that the Trust complies with applicable law, including the InvIT Regulations or such other laws, regulations, rules or guidelines prohibiting insider trading and governing disclosure of material, unpublished price sensitive information.

Policy in relation to Related Party Transactions

To ensure proper approval, supervision and reporting of the transactions between the Trust and its Related Parties, the Board of Directors of the Investment Manager has adopted the Policy in relation to Related Party Transactions as disclosed in Final Offer Document, to regulate the transactions between the Trust and its Related Parties.

Representatives on the Board of Directors of each Project SPVs

The Investment Manager, in consultation with the Trustee, has appointed the majority of the board of directors of Project SPVs. Further, the Investment Manager ensures that in every meeting, including annual general meeting of Project SPVs, the voting of the Trust is exercised.

vii) Committees

In compliance with requirement of the Companies Act, 2013 and Rules made thereunder, Investment Managers Board of Directors constituted the following Committees:

i) Audit Committee; ii) Nomination and Remuneration Committee; and iii) Borrowing Committee

The Chairman of the Board, in consultation with the Company Secretary and the respective Chairman of these Committees, determines the frequency of the meetings of these Committees. The recommendations of the Committees are submitted to the Board for approval.

(i) Audit Committee

The chairperson of the Audit Committee is an independent director. All members of the Audit Committee are financially literate and Chairman of the Committee have accounting and related financial management expertise.

The Composition of Audit Committee as on March 31, 2018 consists of the following members viz.:

1) Mr. B. L. Gupta, Chairman

2) Mr. Sumit Banerjee, Member

3) Mr. Vinod Kumar Menon, Member

The Company Secretary acts as the Secretary of the Audit Committee. The composition, role, terms of reference as well as powers of the Audit Committee are in accordance with the Section 177 of the Companies Act, 2013 and InvIT Regulations, as applicable.

The brief terms of reference of the Audit Committee, inter alia, includes overseeing of the Companys financial reporting process, reviewing the financial statements with the Management, recommending appointment / re-appointment of auditors, fixation of audit fees, reviewing the adequacy of internal audit function, holding periodic discussions with auditors about their scope and adequacy of internal control systems, discussing on any significant findings made by Internal Auditors and following it up with action. The Audit Committee also reviews the financials of the Trust and matters related thereto.

(ii) Nomination & Remuneration Committee

The Composition of Nomination & Remuneration Committee as on March 31, 2018 consists of the following members viz.:

1) Mr. Sumit Banerjee, Chairman

2) Mr. B. L. Gupta, Member

3) Mr. R. P. Singh, Member

4) Mr. Vinod Kumar Menon, Member

The Company Secretary acts as the Secretary of the Nomination and Remuneration Committee.

The brief terms of reference of the Nomination and Remuneration Committee are as follows:

To determine, persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, recommend to the Board their appointment and removal and shall carry out evaluation of every directors performance, formulate the criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board a policy, relating to the remuneration for the directors, key managerial personnel and other employees.

Remuneration Policy

The Nomination and Remuneration Committee has laid down the criteria for determining qualifications, positive attributes and independence of a person proposed to be appointed as a Director and recommend to the Board a policy, relating to the remuneration for the Directors, Key Managerial Personnel and other employees.

The Policy ensures –

(a) the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate directors of the quality required to run the Company successfully;

(b) relationship of remuneration to performance is clear and meets appropriate performance benchmarks; and

(c) remuneration to Directors, Key Managerial Personnel and Senior Management involves a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the Company and its goals.

(iii) Borrowing Committee

The Borrowing Committee was constituted to deal with issues related to raising debt for acquisition of Pathankot Amritsar Project and matters connected thereto. This Committee was dissolved on April 30, 2018.

The Composition of Borrowing Committee as on March 31, 2018 consisted of the following members viz.:

1) Mr. Vinod Kumar Menon, Chairman

2) Mr. Sumit Banerjee, Member

The Company Secretary acts as the Secretary of the Borrowing Committee.

The brief terms of reference of the Borrowing Committee were as follows:

1) To borrow money for the purposes of, and for matters connected to, the Trusts proposed acquisition of IRB Pathankot Amritsar Toll Road Limited from the Sponsor (including its nominee shareholders) and the Project Manager, and finalize the terms and conditions of such borrowings, in consultation with the relevant banks and/ or financial institutions, in the best interest of the Trust and the Unitholders, up to an aggregate sum of Rs 1,55,000 lakhs and/or equivalent thereto in any foreign currency;

2) To determine, the manner of utilization of the funds borrowed, including but not limited to the prepayment/repayment, in part or full, of the outstanding loans/facilities availed by IPATRL from its senior lenders; prepayment, in full, of the subordinate debt provided by the Sponsor and the Project Manager to IPATRL to fund project costs; prepayment, in full, of the unsecured loans and advances provided by the Sponsor and its subsidiary companies; and other expenses, payments and/or charges incurred or required to be incurred in connection with the Trusts proposed acquisition of IRB Pathankot Amritsar Toll Road Limited; on such terms and conditions as the Committee thinks fit at its sole discretion, and in the best interest of the Trust and the Unitholders;

3) To create mortgage, hypothecate, provide guarantees and/or undertakings, pledge and/or create charge any of the assets of the Trust Group (comprising the Trust and the Project SPVs owned by the Trust), including the movable and/or immovable properties of the Trust and/or the Project SPVs, including any securities issued/proposed to be issued, or the whole, or substantially the whole, of the undertaking or undertakings of the Trust Group, on such terms and in such manner as the Committee may think fit, together with power to take over the management of the business or concern of the Trust Group in certain event(s), including for securing any loan(s) obtained/to be obtained by the Trust Group from Bank(s), Financial or other Institution(s), Debenture

Trustees, Mutual Fund(s), Non-Resident Indians (NRIs),Overseas Corporate Bodies (OCBs), Foreign Institutional Investors (FIIs) or any other person(s), body(ies) corporate, etc., whether Unitholder of the Trust or not (hereinafter collectively referred to as "lenders"), for an amount not exceeding Rs 1,55,000 lakhs and/or equivalent thereto in any foreign currency, together with any interests, fees, compound/ additional interest, commitment charges, costs, expenses and all other monies payable by the Trust Group to the concerned lenders;

4) To authorise Key Managerial Personnel of the Investment Manager to execute, for and on behalf of the Investment Manager (acting in its capacity as the investment manager of the Trust), all such agreements, applications, deeds, documents and any other writings in connection with, and to give effect to, the aforesaid resolution, and if required, to issue Power of Attorney in favour of such persons for this purpose; and

5) To authorize affixation of common seal on such documents as may be required.

viii) Functions, Duties and Responsibilities of the Investment Manager

The functions, duties and responsibilities of the Investment Manager are in accordance with the Investment Management Agreement and the InvIT Regulations. The Board of the Investment Manager comprises of majority of the Independent Directors having extensive experience in Infrastructure Sector and Project financing. The business operations of the Investment Manager are managed by a team of professionals with experience in the road infrastructure sector.

Sponsor

IRB Infrastructure Developers Limited (the Sponsor) is Sponsor of the Trust. The Sponsor is one of the largest infrastructure development and construction companies in India in terms of net worth in the roads and highways sector according to the NHAIs annual prequalification for public private partnerships in national highway projects report for 2016. The Sponsor has been listed on the Indian Stock Exchanges since 2008.

As of March 31, 2018; the Sponsor has 17 road projects, of which 11 are being tolled and balance are under various phases of development. The Sponsor has a large project portfolio of 8,745 Lane Kilometres of roads and highways in operation, under construction or under development as of March 31, 2018.

During the period, there is no change in the Board of Directors of the Sponsor.

For more details about the Sponsor, please refer their website www.irb.co.in

TRUSTEE

The Sponsor has settled the Trust pursuant to the Indenture of Trust dated October 16, 2015, as amended on February 17, 2017, and appointed IDBI Trusteeship Services Limited (the "Trustee") in accordance with the provisions of the InvIT Regulations.

The details of the Trustee are as follows:

Details of Trustees Registration with SEBI

The Trustee registered with SEBI as a debenture trustee under the Debenture Trustees Regulations, having SEBI registration number IND000000460. The Trustees SEBI registration certificate is valid unless it is suspended or cancelled by the SEBI.

Background of the Trustee

The Trustee is a trusteeship company, which has been registered with SEBI as a debenture trustee, and has been jointly promoted by IDBI Bank Limited, Life Insurance Corporation and General Insurance Corporation for providing corporate and other trusteeship services.

The Trustee is permitted to engage in the following activities:

i) Debenture / bond trustee;

ii) Security trustee/ facility agent;

iii) Securitization trustee;

iv) Share pledge trustee / share monitoring agent;

v) Escrow agent;

vi) VCF trustees/ AIF Trustees;

vii) Safe keeping / lockers services;

viii) Management of private trusts / execution of wills; and

ix) Special corporate services (e.g. provision of nominee directors)

The Trustee has experience in providing trusteeship services to a range of corporates and institutions.

The Trustee is not an Associate of the Sponsor or the Investment Manager. Further, Trustee (i) is not debarred from accessing the securities market by the SEBI; (ii) is not a promoter, director or person in control of any other company or a sponsor, investment manager or trustee of any other infrastructure investment trust which is debarred from accessing the capital market under any order or directions made by the SEBI; or (iii) is not in the list of the willful defaulters published by the RBI.

To the best of the knowledge of the Trustee, none of the promoters or directors of the Trustee (i) is debarred from accessing the securities market by SEBI; (ii) is a promoter, director or person in control of any other company or a sponsor, investment manager or trustee of an infrastructure investment trust which is debarred from accessing the capital market under any order or direction made by SEBI; or (iii) is in the list of willful defaulters published by the RBI.

The Board of Directors of the Trustee as on March 31, 2018 is as follows:

Sr. No. Name Designation

DIN

1. Mr. G. M. Yadwadkar Chairman 01432796
2. Ms. Sashikala Muralidharan Director 08036523
3. Mr. Ravishankar G. Shinde Director 03106953
4. Ms. Madhuri J. Kulkarni Director 07787126
5. Mr. Swapan Kumar Bagchi Managing Director and CEO 07743570

Functions, Duties and Responsibilities of the Trustee

a) Change in Control of the Trustee

The Trustee shall obtain the prior approval of the Unitholders in the event of a proposed change in control of the Trustee or change in the Trustee, in accordance with the InvIT Regulations and applicable law.

b) Change in Control of the Investment Manager

The Trustee shall obtain the prior approval of the Unitholders in the manner specified under Regulation 22 of the InvIT Regulations (where the votes cast in favour of a resolution shall not be less than one and a half times the votes cast against such resolution) in the event of a proposed change in control of the Investment Manager.

c) Change in Control of the Project Manager

The Trustee is required to obtain the prior approval of the relevant concessioning authority, where applicable, and such other person as may be required under the InvIT Regulations.

d) Change or Removal of the Investment Manager

The Trustee is required to ensure that a new investment manager of the Trust is appointed within such period as may be prescribed under the InvIT Regulations. Further, the Trustee is required to ensure that all the conditions in connection with removal of an investment manager and appointment of a new investment manager as prescribed under the InvIT Regulations are adhered to.

e) Change or Removal of the Project Manager

The Trustee is required to do all such acts and take all such steps as may be prescribed in the InvIT Regulations in the event of any change in the Project Manager for removal or otherwise.

f) Interests of the Unitholders

The Trustee shall at all times exercise due diligence in carrying out its duties and protect the interests of the Unitholders. The Trustee shall make distributions and ensure that the Investment Manager makes declarations of distributions to the Unitholders in a timely manner, in accordance with Regulation 18 of the InvIT Regulations.

g) Income Due to the Trust

The Trustee shall ensure that the Investment Manager undertakes prompt and proper collection of the income due to the Trust. The Trustee shall also ensure that the Investment Manager provides the Trustee with a certificate on a quarterly basis detailing such income.

Any receipt signed by the Trustee for any monies, stocks, funds, shares, securities investment or property, paid, delivered or transferred to the Trustee under or by virtue of the Indenture of Trust or in exercise of the duties, functions and powers of the Trustee shall effectively discharge the Trustee or the person or persons paying, delivering or transferring the same therefrom or from being bound to see to the application thereof, or being answerable for the loss or misapplication thereof, provided that the Trustee and such persons shall have acted in good faith, without negligence and shall have used their best efforts in connection with such dealings and matters.

h) Transactions by Certain Persons

The Trustee shall ensure that all transactions executed and the activities carried out by the Investment Manager and any service provider to whom the Trustee has delegated any powers or duties, subject to the InvIT Regulations, are done in accordance with the Indenture of Trust, the Investment Management Agreement, the Project Implementation Agreements and any agreement executed with such service provider.

i) Trust Fund

The Trustee shall hold the Trust Fund in the name of the Trust and for the benefit of the Unitholders and shall also be responsible for opening and operating bank accounts on behalf of the Trust. The Trustee must ensure that the Trust Fund is held in a bank account opened in the name of the Trust.

j) Trust Assets

The Trustee shall hold the Trust Assets in the name of the Trust and for the benefit of the Unitholders and shall also be responsible for opening and operating bank accounts in the name of the Trust.

k) Subscription amounts

The Trustee shall ensure that the subscription amounts are kept in a separate bank account in the name of the Trust and are only utilised for adjustment against Allotment of Units or refund of money to the applicants till the time such Units are listed.

l) Books of Accounts

The Trustee shall ensure that the Investment Manager shall cause to be maintained, the books of accounts of the Trust in accordance with the Indenture of Trust and the InvIT Regulations.

m) Valuation of the Trust Assets

The Trustee shall ensure that the Investment Manager shall ensure that a detailed valuation is undertaken of the Trust Assets by the valuers at such intervals and in the manner as may be prescribed under the InvIT Regulations. The Trustee shall ensure that the remuneration of the Valuers is not linked to or based on the value of the Trust Assets being valued.

n) Statutory charges or levies payable by the Trust

The Trustee shall ensure that the Investment Manager shall pay all taxes, duties and any other statutory charges or levies that may be payable by the Trust or on behalf of the Unitholders from the Trust Fund.

o) Reports to be filed by the Trust

The Trustee shall, and shall ensure that Investment Manager does, from time to time file such reports as may be required by the SEBI or other governmental agency under applicable law, with respect to the activities carried on by the Trust.

p) Documents and information to be provided to Unitholders

The Trustee shall, and shall ensure that Investment Manager shall, from time to time provide such documents and information to the Unitholders, as may be required under applicable law, with respect to the activities carried on by the Trust.

q) Confidentiality

The Trustee and its directors, Officers, employees and agents shall at all times maintain confidentiality with respect to all the investments and all matters connected with the investments, and shall not disclose any confidential information to any person or use such information in a manner prejudicial to the interest of the Trust, subject to disclosure of information to any court or tribunal or regulatory, supervisory, governmental or quasi-governmental authority where so required under applicable law.

r) Segregation of assets and liabilities

The assets and liabilities of the Trust shall at all times be segregated from, the assets and liabilities of any other trusts managed by the Trustee. The assets held in the name of the Trust shall be held for the exclusive benefit of the Unitholders of the Trust and such assets shall not be subject to the claims of any creditor or other person claiming under any other trust administered by the Trustee or managed by the Investment Manager, as the case may be.

s) Attainment of Objects of the Trust

The Trustee shall ensure that all acts, deeds and things are done with a view to attain the objects of the Trust in compliance with the Trusts investment strategy, applicable law, Indenture of Trust, Investment Management Agreement and Project Implementation Agreements in order to secure the best interests of the Unitholders.

t) Winding up of the Trust

The Trustee shall wind up the Trust only as set out in the Indenture of Trust and in accordance with applicable law. Upon winding up of or dissolution the Trust, the Trustee shall surrender the certificate of registration to the SEBI.

u) Investments by the Trustee

The Trustee shall not invest in the Units unless permitted to do so under applicable law.

v) Grievance redressal

The Trustee shall periodically review the status of Unitholders complaints and their redressal undertaken by the Investment Manager in accordance with the InvIT Regulations.

w) Delegation to Investment Manager

The Trustee shall delegate all such powers to the Investment Manager as may be required by the Investment Manager to carry out its obligations under the Investment Management Agreement and under applicable law.

The Trustee shall delegate all such powers to the relevant Project Manager as may be required by such Project Manager to carry out its obligations under the relevant Project Implementation Agreement and under applicable law.

x) Related Party Transactions

The Trustee shall review the transactions carried out between the Investment Manager and its Associates and obtain a certificate from a practising chartered accountant or valuer, as applicable, with respect to any related party transactions involving the Investment Manager and its Associates, where the Investment Manager has advised that there may be a conflict of interest, stating that such transactions have been done at an arms-length basis.

y) Monitoring

The Trustee may require the Investment Manager to set up such systems and procedures and submit such reports to the Trustee, as may be necessary for the effective monitoring or the functioning of the Trust. The Trustee shall oversee activities of the Investment Manager in the interest of the Unitholders, shall ensure that the Investment Manager is in compliance Regulation 10 of the InvIT Regulations at all times and shall obtain a compliance certificate from the Investment Manager. Further, the Trustee shall ensure that the Investment Manager complies with reporting and disclosure requirements in accordance with the InvIT Regulations and in case of any delay or discrepancy, the Trustee will ensure that the Investment Manager rectifies such delay or discrepancy on an urgent basis.

The Trustee shall also oversee the activities of the Project Manager with respect to compliance with the InvIT Regulations and the Project Implementation Agreement. The Trustee shall obtain a compliance certificate from the Project Manager in this regard, as specified under the InvIT Regulations.

z) Unitholders Meeting

The Trustee shall ensure that the Investment Manager convenes meetings of the Unitholders in accordance with the InvIT Regulations. The Trustee shall also oversee the voting by the Unitholders at such meetings. The Trustee shall ensure that the Investment Manager convenes meetings of Unitholders not less than once every year and the period between such meetings shall not exceed 15 months. In issues pertaining to the Investment Manager such as change in the Investment Manager, including removal of the Investment Manager or change in control of the Investment Manager, the Trustee shall convene and handle all activities pertaining to the conduct of such meetings. In respect of issues pertaining to the Trustee, including any change in the Trustee or change in control of the Trustee, the Trustee will not be involved in any manner in the conduct of such meetings. The Trustee may take up with the SEBI and/ or the Stock Exchanges, any matter which has been approved in any meeting of the Unitholders, if the matter requires such action.

aa) Others

The Trustee shall ensure that the activity of the Trust is operated in accordance with the Indenture of Trust, the InvIT Regulations, the Final Offer Document and Offer Document. In the event, any discrepancy is noticed by the Trustee, then the Trustee shall promptly inform the SEBI in writing. The Trustee shall provide to the SEBI and Stock Exchange such information as may be sought by the SEBI or the Stock Exchanges pertaining to the activity of the Trust.

The Trustee shall promptly inform the SEBI about any act which is detrimental to the interest of the Unitholders.

bb) Compliance Certificate

The Trustee shall obtain a compliance certificate in the form and manner prescribed under applicable law on a quarterly basis, from each of the Investment Manager and the Project Manager.

cc) Power to appoint the Investment Manager

The Trustee shall have the power to appoint the Investment Manager as the investment manager of the Trust. The Trustee shall have the power to execute the Investment Management Agreement or any other agreement or arrangement, from time to time, with the Investment Manager in this regard.

dd) Power to appoint the Project Manager

The Trustee shall in consultation with the Investment Manager have the power to appoint the Project Manager. The Trustee shall have the power to execute the Project Implementation Agreement or any other agreement or arrangement, from time to time, with the Project Manager and the Project SPV in this regard.

VALUER

As per confirmation received from the Valuer, the details of the Valuer is as follows:

WALKER CHANDIOK & CO LLP

L-41, Connaught Circus,

New Delhi – 110 001

Tel: +91 11 4278 7070

Fax: +91 11 4278 7071

Firm Registration No.: 001076N/N500013

GENERAL DISCLOSURES

Except as stated otherwise in this report and in any other public disclosures, during the period under review:

1) there are no changes in the clauses of trust deed, investment management agreement or any other agreement pertaining to activities of the Trust.

2) there are no material regulatory changes that had impacted or may impact cash flows of the underlying projects.

3) there is no change in material contracts or any new risk in performance of any contract pertaining to the Trust.

4) there were no legal proceedings which may have significant bearing on the activities or revenues or cash flows of the Trust.

5) there were no material changes, events or material and price sensitive information to be disclosed for the Trust.

UNIT PRICE PERFORMANCE OF THE TRUST

Particulars

BSE (Rs)

NSE ( )

Unit price quoted on the exchange at the beginning (Closing price of May 18, 2017) 101.79 101.80
Unit price quoted on the exchange at the end (Closing price of March 28, 2018) 82.05 82.04
Highest unit price (May 18, 2017) 105.00 105.00
Lowest unit price (March 19, 2018) 75.25 74.99

MONTHLY HIGHEST AND LOWEST UNIT PRICE

Month

BSE

NSE

High (Rs)

Low (Rs)

High (Rs)

Low ( )

May, 2017 105.00 97.77 105.00 97.76
June, 2017 100.49 94.21 100.00 94.20
July, 2017 99.15 92.76 99.25 92.71
August, 2017 100.00 95.00 100.00 95.05
September, 2017 99.90 93.66 96.75 93.51
October, 2017 95.00 92.50 95.00 92.45
November, 2017 95.85 89.50 95.79 89.50
December, 2017 93.00 86.31 89.75 86.55
January, 2018 89.99 85.75 89.80 85.75
February, 2018 86.80 83.42 86.80 83.05
March, 2018 84.50 75.25 84.50 74.99

AVERAGE DAILY VOLUME TRADED

Month

Average daily volume

BSE

NSE

May, 2017 26,88,500 1,13,28,500
June, 2017 11,47,619 19,23,864
July, 2017 14,60,000 9,08,571
August, 2017 1,90,476 5,27,857
September, 2017 14,42,143 7,74,048
October, 2017 2,32,105 6,93,250
November, 2017 85,909 3,98,182
December, 2017 5,38,000 6,62,750
January, 2018 12,16,591 9,65,227
February, 2018 65,000 2,16,842
March, 2018 9,20,526 13,68,947

DISTRIBUTIONS

The Investment Manager on behalf of the Trust has made four distribution(s) aggregating to Rs 10.55/- per Unit for the period ended March 31, 2018 to the Unitholders of the Trust ( 7.65/- per Unit in the form of Interest & Rs 2.90/- per Unit in the form of Return of Capital). The Distribution was paid to Unitholders within time period stipulated in the InvIT Regulations.

INVESTOR COMPLAINTS

The status of investor complaints as received from Registrar & Transfer Agent is reported to the Board on a quarterly basis. During period ended March 31, 2018, the investor complaints received by the Company were general in nature, which were responded in time to the unitholders. Details of unitholders complaints on quarterly basis are also submitted to stock exchanges within stipulated time period.

SEBI Complaints Redress System (SCORES)

The investor complaints are processed in a centralised web based complaints redress system.

The salient features of this system are centralised database of all complaints, online upload of Action Taken Reports (ATRs) by the concerned companies and online viewing by investors of actions taken on the complaint and its current status.

Your Trust has been registered on SCORES and Investment Manager makes every effort to resolve all investor complaints received through SCORES or otherwise within the statutory time limit from the receipt of the complaint.

GREEN INITIATIVE

Investment Manager is concerned about the environment and utilises natural resources in a sustainable way. The InvIT Regulations allows the Trust to send official documents to their Unitholders electronically.

In terms of the InvIT Regulations, Investment Manager propose to send documents like the Notice convening the general meetings, Financial Statements, Auditors Report and other documents to the email address provided by you with the relevant depositories.

We request you to update your email address with your depository participant to ensure that the Annual Report and other documents reach you on your preferred email.

ISSUE AND BUYBACK OF UNITS

During the Period, the Trust has not issued any additional Units. Further, during the period, the Trust has not bought back any Units.

MATERIAL LITIGATIONS AND REGULATORY ACTIONS

Brief details of material litigations and regulatory actions, which are pending, against the Trust, sponsor(s), Investment Manager, Project Manager(s), or any of their associates and the Trustee if any, as at the end of the period are provided as "Annexure B".

RISK FACTORS

(In this section "We", "Our", "InvIT" means "the Trust and/or Project SPVs owned by the Trust")

Risks Related to our Organization and the Structure of the Trust

1. The debt financing provided by the Trust to each of the Project SPVs comprises of certain unsecured, interest-free and interest-bearing loans as well as loans that is secured by a subordinate charge on (i) the cash flows deposited in the escrow account and (ii) the escrow account of such Project SPV. The payment obligations of the respective Project SPVs in relation to such debt financing will be subordinated to all existing and future obligations of the Project SPVs towards any secured senior lenders.

2. Any payment by the Project SPVs, including in an event of termination of the relevant concession agreement, is subject to a mandatory escrow arrangement which restricts their flexibility to utilise the available funds.

3. The regulatory framework governing infrastructure investment trusts in India is untested and the interpretation and enforcement thereof involve uncertainties, which may have a material, adverse effect on the ability of certain categories of investors to invest in the Units, our business, financial condition and results of operations and our ability to make distributions to Unitholders.

4. We must maintain certain investment ratios, which may present additional risks to us.

5. The Valuation Report, and any underlying reports, are not opinions on the commercial merits of the Trust or the Project SPVs, nor are they opinions, expressed or implied, as to the future trading price of the Units and the valuation contained therein may not be indicative of the true value of the Project SPVs assets.

6. Certain of the Project SPVs have experienced losses in prior years and any losses in the future could adversely affect our business, financial condition and results of operations, our ability to make distributions to the Unitholders and the trading price of our Units.

7. We may not be able to make distributions to Unitholders or the level of distributions may fall.

8. We expect to derive a substantial amount of our revenues from the operation of the Surat–Dahisar NH 8 Project, the Tumkur–Chitradurga NH 4 Project and the Bharuch–Surat NH 8 Project. Any factors adversely affecting these projects could have a material, adverse effect on our business, financial condition and results of operations.

Risks Related to Our Business and Industry

9. Our failure to extend applicable concession agreements or our inability to identify and acquire new road assets that generate comparable or higher revenue, profits or cash flows than the Project SPVs may have a material adverse impact on our business, financial condition and results of operations and our ability to make distributions.

10. The Project SPVs toll-road concessions may be terminated prematurely under certain circumstances.

11. A decline in traffic volumes would materially and adversely affect our business prospects, financial condition and results of operations and our ability to make distributions to Unitholders.

12. Certain investigations are pending against the Related Parties of the Sponsor, the outcome of which may materially and adversely affect the Sponsor / our reputation, business and financial condition.

13. IRB Tumkur Chitradurga Tollway Limited (ITCTPL) and M.V.R. Infrastructure And Tollways Limited (MITPL) are required to pay annual premiums / negative grants in consideration for being granted the right to build and operate their respective projects. Failure to make such payments could result in the termination of the relevant concession agreement by the NHAI.

14. Changes in the policies adopted by governmental entities or in the relationships of any member of the Trust Group with the Government or State Governments could materially and adversely affect our business, financial performance and results of operations.

15. Certain provisions of the standard form of concession agreement may be non-negotiable or untested, and the concession agreements may contain certain restrictive terms and conditions which may be subject to varying interpretations.

16. We may be subject to increases in costs, including operation and maintenance costs, which we cannot recover by increasing toll fees under the concession agreements.

17. Certain actions of the Project SPVs require the prior approval of the NHAI, and no assurance can be given that the NHAI will approve such actions in a timely manner or at all.

18. Leakage of the toll fees on the Project SPVs roads may materially and adversely affect our revenues and financial condition.

19. We will depend on certain directors, executive Officers and key employees of the Investment Manager, the Project Manager and the Project SPVs, and such entities may be unable to retain such personnel or to replace them with similarly qualified personnel, which could have a material, adverse effect on the business, financial condition, results of operations and prospects of the Trust Group.

20. There can be no assurance that we will be able to successfully undertake future acquisitions of road assets or efficiently manage the infrastructure road assets we have acquired or may acquire in the future.

21. The Project SPVs concessions are illiquid in nature, which may make it difficult for us to realise, sell or dispose of our shareholdings in the Project SPVs.

22. The Project SPVs may be required to undertake certain development of the Road Assets owned by the Trust, which may present additional risks to us.

23. The Project SPVs may not be able to comply with their maintenance obligations under the concession agreements, which may result in the termination of the concession agreements, the suspension of the Project SPVs rights to collect tolls or the requirement that the Project SPVs pay compensation or damages to the NHAI.

24. Our insurance policies may not provide adequate protection against various risks associated with our operations.

25. The Project SPVs, the Sponsor, the Investment Manager, the Project Manager and the Trustee are involved in certain legal and other proceedings, which may not be decided in their favour.

26. ISDTPL has filed claims before the NHAI and governmental entities in relation to certain disputes arising out of the Surat–Dahisar NH 8 Project, which are still pending and may not be decided in IRB Surat Dahisar Tollway Limiteds (ISDTPL) favour.

27. We do not own the "IRB" trademark and logo. Our license to use the "IRB" trademark and logo may be terminated under certain circumstances and our ability to use the trademark and logo may be impaired.

28. We will depend on various third parties to undertake certain activities in relation to the operation and maintenance of the Initial Road Assets. Any delay, default or unsatisfactory performance by these third parties could materially and adversely affect our ability to effectively operate or maintain the Initial Road Assets.

29. The Project SPVs may be held liable for the payment of wages to the contract labourers engaged indirectly in our operations.

30. Our contingent liabilities could adversely affect our results of operations, cash flows and financial condition.

31. Our actual results may be materially different from the expectations expressed or implied in the Revenue, Profit and Cash Flow Projections and the assumptions are inherently uncertain and are subject to significant business, economic, financial, regulatory and competitive risks and uncertainties that could cause actual results to differ materially from those projected.

32. Our business will be subject to seasonal fluctuations that may affect our cash flows.

33. Certain Project SPVs operations and revenue are, currently, geographically concentrated in Gujarat, Maharashtra and other Indian states and consequently we will be exposed to certain risks emanating therefrom.

34. The Road Assets are concentrated in the infrastructure sector and toll-road industry in India, and our business could be adversely affected by an economic downturn in that sector or industry.

35. Political and other agitations against the collection of tolls may affect our ability to collect tolls over prolonged periods, which could have a material, adverse effect on our business, results of operation and financial condition.

36. The cost of implementing new technologies for collection of tolls and monitoring our projects could materially and adversely affect our business, financial condition and results of operations.

37. We may be unable to renew or maintain the statutory and regulatory permits and approvals required to operate the Initial Road Assets.

38. Compliance with, and changes in, safety, health and environmental laws and regulations in India may materially and adversely affect our business.

39. The Project SPVs financing agreements entail interest at variable rates, and any increases in interest rates may adversely affect our results of operations, financial condition and cash flows.

40. The Project SPVs are subject to restrictive covenants under their financing agreements that could limit our flexibility in managing our business or to use cash or other assets.

41. We have obtained a credit rating of CARE AAA from CARE Ratings Ltd for long term bank facilities of Rs 1,550 crores availed by the Trust. Any downgrade of our credit rating may restrict our access to capital and materially and adversely affect our business, financial condition and results of operations.

42. We will enter into related-party transactions. There can be no assurance that we could not have achieved more favourable terms if such transactions had been entered into with third parties.

Risks Related to the Trusts Relationships with the Sponsor and the Investment Manager

43. The Sponsor, whose interests may be different from the other Unitholders, will be able to exercise significant influence over certain activities of the Trust.

44. The ROFO/ROFR Deed and the Future Assets Agreement will terminate in certain circumstances and shall be subject to the terms of the concession agreement and applicable law.

45. The Sponsor is a listed company and operates other road assets, and anything that impacts the business, results of operations and trading price of the Sponsors equity shares may have a material, adverse effect on the Trust and the trading price of the Units.

46. The Investment Manager may not be able to implement its investment or corporate strategies and the fees payable to the Project Manager are dependent on various factors.

47. Parties to the Trust are required to maintain the eligibility conditions specified under Regulation 4 of the InvIT Regulations on an ongoing basis. The Trust may not be able to ensure such ongoing compliance by the Sponsor, the Investment Manager, the Project Manager and the Trustee, which could result in the cancellation of the registration of the Trust.

48. The Investment Manager is required to comply with certain ongoing reporting and management obligations in relation to the Trust. There can be no assurance that the Investment Manager will be able to comply with such requirements.

Risks Related to Tax

49. Changes in legislation or the rules relating to tax regimes could materially and adversely affect our business, prospects and results of operations.

50. Some of our roads assets enjoy certain benefits under Section 80-IA of the Income Tax Act and any change in these tax benefits applicable to us may materially and adversely affect our results of operations.

51. Tax laws are subject to changes and differing interpretations, which may materially and adversely affect our operations.

52. Entities operating in India are subject to a variety of Government and State Government tax regimes and surcharges and changes in legislation or the rules relating to such tax regimes and surcharges could materially and adversely affect our business.

53. Investors may be subject to Indian taxes arising out of capital gains on the sale of Units.

INFORMATION OF THE CONTACT PERSON OF THE TRUST

Mr. Urmil Shah

Compliance Officer

Address: IRB Complex, Chandivali Farm,

Chandivali Village, Andheri (East),

Mumbai – 400 072

Tel: +91 22 6640 4299

Fax: +91 22 6640 4274

E-mail: info@irbfl.co.in