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Dhir India Inv. plc (DHIR)

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Wednesday 03 October, 2007

Dhir India Inv. plc

First Investment

Dhir India Investments plc
03 October 2007


                           Dhir India Investments plc
                        ("Dhir India" or the "Company")

                               Maiden Investment

             Acquisition of assets of Jaipur Metals and Electricals

Dhir India (AIM: DHIR), the first UK quoted company established to invest in the
circa $50 billion* Indian non performing assets sector, announces that it has
established Turquoise Metals and Electricals Private Ltd., a Special Purpose
Vehicle ("SPV"), for the function of acquiring the assets of Jaipur Metals and
Electricals Ltd. ("JMEL"). The transaction will involve the break up and sale of
assets of JMEL.

Under the terms of the agreement, it is expected that Dhir India will invest
£4.91 million and Alok Dhir and/or certain of his connected persons will invest
£1.64 million by way of settlement of payment of JMEL's existing lenders and
payment of its statutory liabilities. Out of the aggregate expected investment
of £6.54 million an amount of around £1.5 million has already been invested to
acquire around 28% of the debt of JMEL.

JMEL was a manufacturing company, which, due to an inability to restructure the
business and invest in plant and machinery, ceased production in 1998. Its plant
is located on a 41,000 square metre site located near Jaipur railway station in
the centre of the city, which is the capital of Rajasthan. The investment is
secured on these real estate assets, comprising of both land and factory
buildings, which were recently valued at over £18.29 million. Dhir India intends
to clear the land, plant and machinery to recover its investment.

It is expected that the entire process of acquisition, resolution and disposal
of the land will take around 12-15 months.

Commenting on Dhir India's maiden investment, Alok Dhir of Dhir India commented:
"This investment is our first since listing on AIM in July and represents the
management's first opportunity to validate its strategy for creating value. We
believe strongly that the JMEL assets are attractive, well located and we expect
to extract significant value from the project over a 12 to 15 month period.

"The fundamentals of the Indian underperforming assets sector remain compelling
and we continue to see a number of promising opportunities to leverage our
expertise and access to capital to create value for our shareholders."

(*Source: The Wharton School, February 2007)

For further information, please contact:

Dhir India Investments    Evolution Securities       Tavistock Communications
Alok Dhir                 Tom Price                  Simon Hudson
Shivi Agarwal             Jeremy Ellis               Rachel Drysdale
Chris Clarke
Tel: +91 11 424 10000     Tel: +44 (0)20 7071 4300   Tel: +44 (0)207 920 3150


About Dhir India
Dhir India provides shareholders with both income and capital growth and was the
first UK quoted vehicle to provide western fund managers with the opportunity to
invest in the Indian non performing assets market. In July 2007 it raised £25
million and commenced trading on AIM.

The Company primarily considers four types of investment opportunity:
   - Turnaround of companies
   - Re-sale of assets or companies
   - Break-up and sale of assets
   - Bridge financing

The current stock of non performing assets (NPAs) in India was built up
primarily as result of the transformation of the Indian economy in the 1990s
from a centrally regulated to a more free market economy. During this time,
commercial lending rates were as high as 18-20 per cent. per annum, whilst the
industrial growth rate remained sluggish at 2-3 per cent. per annum and Indian
industries could not cope with the competition from international companies,
which did not have such a high cost of capital.

This has created an opportunity to invest in NPAs, which are typically
over-leveraged capital structures with insufficient liquidity and in default of
their obligations to creditors. Often these companies have significant assets
and/or solid underlying business fundamentals, which are not being fully
utilised in spite of the fact that the rate of growth in the industrial sector
has caught up with that of the rest of the economy, being an estimated 9-10 per
cent. per annum since 2004-2005.

In such circumstances, Dhir India believes that the resolution of the existing
debts, and in some cases a turnaround of the underlying business, can lead to
substantial profits on exit from the investments being generated in the short
and medium term.



                      This information is provided by RNS
            The company news service from the London Stock Exchange

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