GMR INFRASTRUCTURE LIMITED

1 PROSPECTUSD ated August 07, 2006 Please read Section 60B of the Companies Act, 1956100% Book Building IssueGMR INFRASTRUCTURE LIMITED (We were originally incorporated on May 10, 1996 as a public LIMITED company called Varalakshmi Vasavi Power Projects LIMITED in the State of Andhra Pradesh. On May 23, 1996 we received our certificateof commencement of business. On May 31, 1999 we changed our name to GMR Vasavi INFRASTRUCTURE Finance LIMITED . On July 24, 2000 we changed our name to GMR INFRASTRUCTURE LIMITED . On October4, 2004 we shifted our registered office from the State of Andhra Pradesh to the State of Karnataka. The Company is the holding company of the GMR Group, having interests in power generation,development, maintenance and operation of roads and airports)Registered Office and Corporate Office: Skip House, 25/1 Museum Road, Bangalore 560 025 Tel: +91 80 2207 0100; Fax: +91 80 2299 8118; Web site: ;Contact Person/Compliance Officer: Mr.

2 A. S. Cherukupalli Email: OF 38,136,980 EQUITY SHARES OF RS. 10 EACH AT A PRICE OF RS. 210 FOR CASH AGGREGATING RS. 8, MILLION (REFERRED TO AS THE ISSUE ), COMPRISING500,000 EQUITY SHARES OF RS. 10 EACH RESERVED FOR THE ELIGIBLE EMPLOYEES OF THE COMPANY AND A NET OFFER TO public OF 37,636,980 EQUITY SHARESOF RS. 10 EACH. THE ISSUE LESS THE EMPLOYEE RESERVATION PORTION SHALL BE HEREINAFTER REFERRED TO AS THE NET OFFER TO THE public . THE ISSUEWILL CONSTITUTE OF THE FULLY DILUTED POST ISSUE PAID-UP CAPITAL OF THE COMPANY. THE NET OFFER TO THE public WOULD CONSTITUTE THE FULLY DILUTED POST ISSUE PAID-UP CAPITAL OF THE PRICE OF RS. 210 PER EQUITY SHARE OF FACE VALUE RS. 10 EACHISSUE PRICE ISSUE PRICE IS 21 TIMES OF THE FACE VALUE*The Issue Price determined on completion of the Book Building Process for Retail Bidders and Bidders in the Employee Reservation Portion (for Bids upto Rs.)

3 100,000) is at a 5% discount to the Issue Pricedetermined for Bidders in the Employee Reservation portion (for Bids more than Rs. 100,000), Non Institutional Bidders and QIBs. Such differential amount shall be adjusted against the balance amountpayable (in case of Payment Method I) or be refunded to the Retail Bidders and Bidders in the Employee Reservation Portion (for Bids upto Rs. 100,000), as the case may be. For more details, please referto the Section Titled Issue Procedure on page 363 of this case of revision in the Price Band, the Bidding/Issue Period shall be extended for three additional days after such revision, subject to the Bidding/Issue Period not exceeding ten working days. Any revisionin the Price Band, and the revised Bidding/Offer Period, if applicable, shall be widely disseminated by notification to the Bombay Stock Exchange LIMITED ( BSE ) and the National Stock Exchange of IndiaLimited ( NSE ), by issuing a press release and by indicating the change on the web sites of the Book Running Lead Managers and the terminals of the terms of Rule 19 (2)(b) of the Securities Contract Regulation Rules, 1957 ( SCRR ), this being an Issue for less than 25% of the post Issue capital, the Issue is being made through the 100% Book BuildingProcess wherein at least 60% of the Net Offer to the public will be allocated on a proportionate basis to Qualified Institutional Buyers ( QIBs ), out of which 5% shall be available for allocation on aproportionate basis to Mutual Funds only.

4 The remainder shall be available for allocation on a proportionate basis to QIBs and Mutual Funds, subject to valid bids being received from them at or above theIssue Price. If at least 60% of the Net Offer to the public cannot be allocated to QIBs, then the entire application money will be refunded forthwith. Further, up to 10% of the Net Offer to the public will beavailable for allocation on a proportionate basis to Non-Institutional Bidders and up to 30% of the Net Offer to the public will be available for allocation on a proportionate basis to Retail Bidders, subject tovalid bids being received at or above the Issue Price. Further, up to 500,000 Equity Shares shall be available for allocation on a proportionate basis to the Eligible Employees, subject to valid Bids beingreceived at or above the Issue Retail Bidders and Bidders in the Employee Reservation Portion, two payment methods are available.

5 The details of the payment methods are given below. Please also refer to the section titled IssueProcedure on page 363 of this Prospectus and the risk factor associated with Payment Method I on page xxxv of this Prospectus. Payment Method I is not available to Non-Institutional Bidders and payable perPayment Method IPayment Method IIEquity Share(Only for Retail Bidders and BiddersRetail Biddersin the Employee Reservation Portion**)and BiddersNon-Institutionalin the EmployeeBiddersQIBsFace valuePremiumTotalReservation PortionAmount PayableRs. 5 (per Equity Share,Rs. 120 (per Equity Share, Rs. 125 (per Equity Share,100% of the Bid100% of the Bid10% of the Bidon Application irrespective of the Bid)irrespective of the Bid)irrespective of the Bid)Amount payable on allocationbut before allotmentNANANANANA90% of the BidBy Due Date for BalanceAmount PayableRs.

6 5Rs. **Rs. 10Rs. 210Rs. 210**The Issue Price determined on completion of the Book Building Process for Retail Bidders and Bidders in the Employee Reservation Portion (for Bids up to Rs. 100,000) is Rs. per EquityShare, which is at a 5% discount to the Issue Price.**for bids up to Rs. 100,000 RISK IN RELATION TO FIRST ISSUEThis being the first public issue of Equity Shares of the Company, there has been no formal market for the Equity Shares of the Company. The face value of the Equity Shares is per Equity Share and theIssue Price is 21 times of the face value. The Issue Price (as determined by the Company, in consultation with the Book Running Lead Managers, on the basis of assessment of market demand for the EquityShares offered by way of book building) should not be taken to be indicative of the market price of the Equity Shares after the Equity Shares are listed.

7 No assurance can be given regarding an active and/orsustained trading in the Equity Shares of the Company or regarding the price at which the Equity Shares will be traded after Company has not opted for IPO RISKSI nvestment in equity and equity related securities involve a degree of risk and investors should not invest any funds in this Issue unless they can afford to take the risk of losing their investment. Investors areadvised to read the risk factors carefully before taking an investment decision in this Issue. For taking an investment decision, investors must rely on their own examination of the Issuer and the Issue includingthe risks involved. The Equity Shares have not been recommended or approved by the Securities and Exchange Board of India (SEBI) nor does SEBI guarantee the accuracy or adequacy of this attention of investors is invited to the section titled Risk Factors beginning on page xi of this S ABSOLUTE RESPONSIBILITYThe Issuer having made all reasonable inquiries, accepts responsibility for and confirms that this Prospectus contains all information with regard to the Issuer and the Issue, which is material in the context ofthe Issue, that the information contained in the Prospectus is true and correct in all material aspects and is not misleading in any material respect, that the opinions and intentions expressed herein are honestlyheld and that there are no other facts.

8 The omission of which make this Prospectus as a whole or any of such information or the expression of any such opinions or intentions misleading in any material Equity Shares are proposed to be listed on the Bombay Stock Exchange LIMITED , Mumbai ( BSE ) and the National Stock Exchange of India LIMITED ( NSE ) and the Company has received in-principleapprovals from these Stock Exchanges for the listing of its Equity Shares pursuant to letters both dated May 26, 2006. For purposes of this Issue, the Designated Stock Exchange is PROGRAMMEBID / ISSUE OPENS ON : July 31, 2006 BID / ISSUE CLOSES ON : August 4, 2006 BOOK RUNNING LEAD MANAGERSJM Morgan StanleyPrivate Limited141 Maker Chambers III,Nariman Point, Mumbai 400 021 Tel: +91 22 6630 3030 Fax: +91 22 2204 7185 Email: site: Person : Mr. Kushal DoshiEnam Financial ConsultantsPrivate Limited801, Dalamal Towers,Nariman PointMumbai 400 021 Tel: +91 22 6638 1800 Fax: +91 22 2284 6824 Email: site: Person : Ms.

9 Shital ShahSSKI Corporate FinancePrivate Limited803-804, Tulsiani Chambers,8th Floor, Nariman Point,Mumbai 400 021 Tel: +91 22 6638 3333 Fax: +91 22 2204 0282 Email: site: Person : Mr. S. VenkatraghavanREGISTRAR TO THE ISSUEK arvy Computershare Private LIMITED "Karvy House", 46, Avenue 4, Street Hills,Hyderabad 500 : + 91 40 2331 2454 Fax: + 91 40 2331 1968 Email: Person : Mr. M. Murli KrishnaDSP Merrill Lynch LimitedMafatlal Centre, 10th Floor,Nariman Point, Mumbai 400 021 Tel: +91 22 2265 1702 Fax: +91 22 2262 1187 Email: Person : Mr. ShekharTABLE OF CONTENTSSECTION I : DEFINITIONS AND / General Related / Industry related II : RISK Conventions; Use of Market III : Financial of the Terms of Issue / Issue for Issue of Possible Tax Benefits available to the Company and its IV : ABOUT THE ISSUER of Important Project and and Corporate Party rates and currency of V : FINANCIAL and Other Information of Group s Discussion and Analysis of Financial Condition and Results ofOperations of GMR INFRASTRUCTURE LIMITED based on the Audited ConsolidatedFinancial Statements prepared as per Indian GAAP.

10 295 SECTION VI : LEGAL AND OTHER Litigation and Of Certain VII : OTHER REGULATORY AND STATUTORY VIII : ISSUE of the IX: DESCRIPTION OF EQUITY SHARES AND TERMS OF THE ARTICLES OF of Equity Provisions of the Articles of Association of GMR INFRASTRUCTURE X : OTHER Contracts and Documents for I : DEFINITIONS AND ABBREVIATIONSTermDescription GIL, the Company , our Company ,Unless the context otherwise requires, refers to GMR INFRASTRUCTURE LIMITED , incorporatedunder the Companies Act and having its registered office at Skip House, 25/1 MuseumRoad, Bangalore 560 025 Airport BusinessUnless otherwise indicated shall include the GMR Group s initiatives in the airport sectorincluding the activities undertaken by GHIAL, Delhi International Airport and GatewaysBharat Sugar / BSMLB harat Sugar Mills LIMITED , incorporated under the Companies Act and having its registeredoffice at Bangur Nagar, Dandeli, Karnataka 581 325 Delhi International Airport / DIALD elhi International Airport Private LIMITED .