Edelweiss Capital Ltd – Investor Presentation

Third Quarter Results

January 2009
Safe Harbor

This presentation and the discussion that follows may contain certain words or phrases that are forward - looking
statements, based on current expectations of the management of Edelweiss Capital Ltd. or any of its subsidiaries
and associate companies (“Edelweiss”). Actual results may vary significantly from the forward-looking statements
contained in this presentations due to various risks and uncertainties. These risks and uncertainties include the
effect of economic and political conditions in India and outside India, volatility in interest rates and in the securities
market, new regulations and Government policies that may impact the businesses of Edelweiss as well as its ability
to implement the strategy. The information contained herein is as of the date referenced and Edelweiss does not
undertake any obligation to update these statements. Edelweiss has obtained all market data and other information
from sources believed to be reliable or its internal estimates, although its accuracy or completeness can not be
guaranteed.

This presentation is for information purposes only and does not constitute an offer or recommendation to buy or sell
any securities of Edelweiss. This presentation also does not constitute an offer or recommendation to buy or sell
any financial products offered by Edelweiss. Any action taken by you on the basis of the information contained
herein is your responsibility alone and Edelweiss or its directors or employees will not be liable in any manner for the
consequences of such action taken by you. Edelweiss and/or its directors and/or its employees may have interests
or positions, financial or otherwise, in the securities mentioned in this presentation.

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Contents

1. Financial Highlights

2. Industry Trends

3. Performance Highlights

4. Challenges Going Forward

5. Edelweiss Across The Years

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1. Financial Highlights
Consolidated Results at a Glance

Revenues of INR 1,986 mn (INR 2,496 mn in second quarter FY09)

y Fee & Commission Income of INR 477 mn (INR 678 mn)

y Treasury, Arbitrage and Trading Income of INR 448 mn (INR 853 mn)

y Interest Income of INR 927 mn (INR 844 mn)

Profit After Tax and Minority of INR 381 mn (INR 436 mn)

y PBT Margin improvement to 36.5% (33.0%)

Diluted quarterly EPS of INR 4.93 (INR 5.56)

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Consolidated Unaudited Quarterly Results

INR Million FY09 FY09 FY08 FY09 FY08 FY08

Q3 Q2 Q3 9M 9M Annual

Fee and Commission Income 477 678 1,252 2,041 2,993 4,438

Treasury, Arbitrage and Trading Income 448 853 946 2,003 2,150 3,493

Investment and Dividend Income # 134 115 363 586 599 766

Interest Income 927 844 671 2,534 1,085 2,171

Other Operating Income 1 6 3 7 4 21

Total Revenues 1,986 2,496 3,235 7,171 6,831 10,889

Operating and other expenses * 579 723 628 1,960 1,373 2,280

Employee Cost 382 482 480 1,361 1,234 2,057

Financial expenses 258 423 673 1,120 1,182 2,012

Depreciation 42 44 17 120 40 73

Total Expenses 1,261 1,672 1,798 4,561 3,829 6,422

Profit Before Tax 725 824 1,437 2,610 3,001 4,467

Tax expenses 276 325 473 962 1,014 1,540

Profit After Tax 449 499 964 1,648 1,988 2,927

Share of minority interests in profits 67 63 40 193 81 195

Profit After Tax and Minority Interest 381 436 924 1,455 1,907 2,732

Diluted EPS (INR-not annualized) 4.93 5.56 12.95 18.81 30.03 39.99

(#) Quarter and 9 months ended 31st Dec 2008 includes income of INR 61.6 mn and INR 282.7 mn respectively, from liquid mutual funds.
(*) Quarter and 9 months ended 31st Dec 2008 costs include Securities Transaction Tax of INR 117.1 mn and INR 612.9 mn respectively.
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Key Metrics

Period ending 9M’09 2008 2007 2006 2005 2004

Net Worth (INR mn) * 25,692 23,274 7,222 1,787 539 302

Book Value Per Share (FV INR 5) (INR)# 269.6 246.5 93.6 39.3 15.8 9.2

Diluted EPS (FV INR 5) (INR)# 18.81 39.99 20.76 9.34 6.43 2.42

Pretax Margins 36% 41% 47% 41% 47% 38%

RoE (Annualized) 10% 28% 34% 39% 56% 30%

(*) Includes minority interest

(#) Adjusted for corporate actions, Not annualized for 9M’09

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Diversified Revenue Streams

FY07 FY08 9M’09

Fee & Commission Treasury Interest Investment & Others

Achieving Greater Balance Through Diversification of Revenue Streams

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2. Industry Trends
Secondary Markets

INR bn USD bn

Volumes down 17% on QoQ basis, 41% YoY Net outflow of ~ USD 13 bn in last four quarters
Includes volumes on BSE and NSE
Source: BSE, NSE

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ECM and Advisory Transactions

Public Equity Deals Domestic Debt Market

Volume in INR bn

Volume in INR bn
No. of Deals

No. of Deals
Notes:
Public Equity Deals include Domestic Equity Offerings, Rights, FCCBs and Depository Receipts
Domestic Debt Markets include Debt Private Placements and commercial papers
Source: Bloomberg, Prime Database, Venture Intelligence

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ECM and Advisory Transactions

M&A Deals Private Equity

Volume in INR bn
Volume in INR bn

No. of Deals
No. of Deals

Notes:
M&A Deals are announced deals all announced deals which may or may not have been completed
Source: Bloomberg, Prime Database, Venture Intelligence

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3. Performance Highlights
Agency Businesses

Investment Banking business closed 3 transactions in Q3 and 9 transactions YTD

Key transactions include

• Acquisition of PeopleSupport, Inc. by Aegis for USD 250 mn

• Private equity placement of USD 75 mn for SKS Microfinance

Adjudged winner in the Best Merchant Banker category in the Outlook Money NDTV
Profit Awards 2008

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Agency Businesses

In the first full year of operations of Debt Syndication Desk

• Ranked #1 as per Prime Database in Short Term Debt Placement for CY’08

• Ranked #9 by Bloomberg and Thomson Reuters in Indian Domestic Bonds Market

League Table for CY’08

Equity and Derivatives average daily trading volumes

• Q3’09 of INR 31.5 bn; 9M’09 of INR 43 bn

• Market share* of 6.6% of total average daily volumes – 9M’09

Research covers over 200 stocks across 19 sectors accounting for 70% of total
market capitalization

Alternate Asset Management AUMs/AUAs now stand at USD 440 mn. Launched a new
debt fund this quarter

(*) Market share based on the reported volumes on NSE and BSE
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Capital Businesses

One of the worst quarters for the equity indices globally

Risk management approach tested, kept focus on capital preservation

Moved part of the treasury allocation to Bank FDs

Treasury book size reduced, but yields remained stable

Fall in arbitrage revenues, partly offset by increase in interest income and reduction in
STT

STT for the quarter was INR 11.7 cr, down from INR 24.3 cr in the previous quarter

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Interest Businesses

Interest businesses comprises of interest income on collateralized lending and the

interest earned on working capital in the form of Bank FDs

Interest income increased for the quarter by 10% reflecting higher yields on the
lending book and increase in FDs base

Bank FDs as of end of quarter stood at INR 15.5 bn

As on end of quarter, lending book asset base stood at INR 8 bn (INR 10 bn at end of
previous quarter)

Maintained sufficient collateral cover across all loans, average collateral cover above
2.9x at the end of the quarter

0.5% Prudential General Loan Loss Provision in the Lending Book

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4. Challenges Going Forward
Key Challenges and Our Approach
Risks
Business Volatility
Fall in business volumes in the midst
of domestic and global financial
turmoil
Risk to Capital
Sharp fall in asset prices, one of the
worst quarters for equity indices,
deteriorating credit environment
Liquidity Risk
Significant asset liability mismatches
compounded by global liquidity
squeeze
Our Approach
Diversified Business Model
Flexible resources: capital and people
Flexible cost base: nearly half of our costs are
variable in nature
Strong risk management culture
Approach to Capital Preservation
Board level oversight
Board Risk committee headed by an external Director
Strong and Liquid Balance Sheet
• Balance Sheet size of INR 33 bn, Group net-worth
in excess of INR 25 bn
• Low gearing
• Reverse ALM position – duration of assets is lower
than that of liabilities
Maintaining higher cash and cash equivalents
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5. Edelweiss Across the Years
Consolidated Financials
(In INR mn except per share data)

Year Ended March 31 9M’09 2008 2007 2006 2005 2004

Total Income 7,171 10,889 3,718 1,533 727 281

Total Expenditure 4,561 6,422 1,971 898 383 175

Profit Before Tax 2,610 4,467 1,747 636 345 106

Tax Expenses 962 1,540 646 218 107 28

Net Profit (after tax and minority interest) 1,455 2,732 1,099 417 237 78

Paid up Equity Share Capital 375 375 45 38 29 28

Net Worth* 25,692 23,274 7,222 1,787 539 302

Diluted Earnings Per Share (FV INR 5) (INR)# 18.81 39.99 20.76 9.34 6.43 2.42

Book Value Per Share (FV INR 5) (INR)# 269.6 246.49 93.58 39.33 15.83 9.16

(*) Includes minority interest

(#) Adjusted for corporate actions, Not annualized for 9M’09

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Solid Track Record of Profitable Growth

Revenues Profit After Tax*

9M

INR mn
INR mn

9M

Net
Income 25% 29% 26% 30% 25% 20%
Margin

(*) after minority interest

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Solid Track Record of Profitable Growth

Net Worth* Return on Equity#

INR mn

(*) Including minority interest

(#) Based on average equity for the year, annualized for 9M’09

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 6. Edelweiss Profile

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Well Diversified Integrated Financial Services Model

Agency-based

Capital-based

Lending

Treasury

Asset Management

Wealth Management

Treasury Private Client Broking

Institutional Equities Institutional Equities

Investment Banking Investment Banking Investment Banking

2000 2003 2008

Strategy of selectively building new businesses adjacent to our current offerings

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Shareholding Pattern & Top External Shareholders

Other
Top 5 External Shareholders#
Institutions*
12.9%
Private Equity As on 31st December 2008
Investors
34.4%
Individuals Name Percent
14.6%
1 GIC (Singapore) 8.3%

2 Galleon 7.9%

3 Greater Pacific Capital 6.5%

4 Fidelity 4.3%
Promoters
38.1%
5 Americorp Ventures Ltd. 4.0%

Quality institutional investors from different geographies

(*) includes FII, DII, Insurance companies, Banks, MFs etc.

(#)Holding of known affiliates have been clubbed together for the purpose of this information
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Active Board of Directors with complementary skills

Experienced Board of Directors with diverse areas of expertise

Six independent /non-executive directors out of eight

Independent Risk Committee headed by an external director

Strong corporate governance

Rashesh Shah Venkatchalam

Sanjay Kunnasagaran Ramanan Sunil P.N. Narendra Jhaveri
Management Ramaswamy
Santhanam Chinniah Raghavendran Wadhwani Venkatachalam Independent
Representative Management
Non-Executive Non-Executive Independent Independent Independent
Representative

Former
MD & Head of Risk Former MD Jt. MD ICICI
Executive Executive V.P. Managing Partner Co-Founder & CEO
Chairman & CEO Galleon Group State Bank Former Chairman
Director GIC, Singapore Kubera Partners iGATE Corporation
[Head of Risk Committee] of India ICICI Securities
[Head of Audit Committee]

18 yrs experience Diverse Strong expertise Extensive Strong Extensive Extensive

in public and experience in risk Experienced experience in background in experience in experience
private markets in financial management and in global managing entrepreneurship Indian credit in Indian
in India sector alternate asset private equity Investments globally across markets capital markets
management geographies

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Experienced Management Team

Experienced and Capable

Strong track record of identifying business opportunities and executing on strategy
Management

Depth in Management Team Experienced business heads supported by a deep layer of skilled middle managers

Continuity Track Record A large % of the senior management team have been with the company for over five years

Management and employees together hold approximately 55% shares (including ESOPs)
Employee Ownership
of the Company (20% owned by non-promoter employees)

Senior Management Team

Rujan Panjwani Naresh Kothari

Venkat
Rashesh Shah Asset Management Broking Deepak Mittal
Ramaswamy
Chairman & CEO Global Risk Wealth Management CFO
Executive Director
Member of CEO Office Member of CEO Office

Vikas Khemani Peeyoosh Chadda Mohan Natarajan Ravi Bubna

Institutional Equities Asset Management Private Client Group Wholesale Financing

45 Member Senior Leadership Team (SLG)

80 Member Leadership Team (LG)

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Thank you
For more information, please visit www.edelcap.com
Or email ir@edelcap.com