65260881 presentation reliance industries ltd

5/20/2018 65260881 Presentation Reliance Industries Ltd

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Reliance Industries LimitedFinancial Presentation Q1 FY 2001-02

July 31, 2001


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Background

Major Subsidiaries & Associates

BCG Matrix

GE Nine Cell Matrix

Hofers Product Eolution !atrix

Contents


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"#erating Eniron!ent

$inancial Perfor!ance

Business %eie

%eliance Petroleu!

%eliance 'nfoco!

Su!!ar(

Contents


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Background

The Reliance Group, founded b !hirubhai"# $mbani %1&32'2((2), is India*s largestpri+ate sector enterprise, ith businessesin the energ and materials +alue chain#Group*s annual re+enues are in e-cess of./0 3( billion# The flagship compan,Reliance Industries Limited, is a ortune

Global (( compan and is the largestpri+ate sector compan in India# !hirubhai"# $mbaniounder hairman RelianceGroup !ecember 2, 1&32 ' 5ul 6, 2((2


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Refiner

Reliance 7etroleum Reliance Retail %R R L)

Reliance Global 8anagement /er+ices %7) Ltd

Reliance Biopharmaceuticals Ranger arms Ltd

Reliance 9ngineering $ssociates %7) Ltd

Reliance :il ; Gas ind 7etrochemicals Business

8a


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5amnagar Refiner= The 5amnagar Refiner is apri+ate sector crude oil refiner oned bReliance Industries Limited in 5amnagar, India#The refiner as commissioned on 14 5ul 1&&&ith an installed capacit of 661,((( barrels per

da %1(,1(( m>?d)# It is the largest greenfieldrefiner in the orld# @ith the completion of theR7L refiner, 5amnagar has emerged as theARefining "ub of the @orld ith the largest

refining comple- ith an aggregate refiningcapacit of 1#24 million barrels of oil per da in

an single location in the orld#

Refiner


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Refining acti+ities of Reliance Industries Limitedare carried out at the 5amnagar refiner comple-ith refining capacit of 2C million tonnes perannum#The refiner is able to process a ide +ariet of

crudes' from +er light to +er hea+ %from 1 to4 degree $7I) and from seet to +er hea+ %ithsulphur content from ( to 4#D)#

@ith an annual crude processing capacit of(,((( barrels %&2,((( m3) per stream da%B7/!), R7L is the si-th largest refiner in theorld#

Refiner


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Reliance 7etroleum Reliance 7etroleumLimited =/et up b Reliance Industries Limited %RIL), oneof India*s largest pri+ate sector companies#

R7L has a strategic alliance ith he+ron India"oldings 7te Limited, /ingapore, a holl onedsubsidiar of he+ron orporation ./$ %he+ron),hich currentl holds a D eEuit stake in the

ompan

Reliance 7etroleum Reliance7etroleum Limited


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Reliance Retail is the retail business ingof the Reliance business#

Reliance Retail continues to consolidate

its presence and operations ith more than&(( stores in o+er( cities here it isoperational toda#

9':ffice 7lanet 7ri+ate Limited, Reliances


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8an Brands come under the Reliance RetailBrand like ='Reliance resh#Reliance ootprint#Reliance Time :ut#

Reliance !igital#Reliance @ellness#Reliance TrendF#Reliance $utoFone#

Reliance /uper#Reliance 8art#Reliance i'/tore#Reliance "ome itchens#

Reliance 5eel#

Reliance Retail %RRL)


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Reliance Global /er+ices 7+t Ltd is one of the fastgroing IT solutions and ser+ices pro+ider ithoffices in ./$, "derabad'India, deli+ering best'in'class ser+ices to help clients reduce costs,enhance organiFational fle-ibilit, and impro+e

business and IT performance#It encompass='9R7 specialiFed in /$7#

ustom application de+elopment# $pplication maintenance and support#

8anagement'consulting ser+ices

Reliance Global 8anagement/er+ices %7) Limited


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# Reliance Global management teamcomprises of ace professionals, each ithears of managerial e-perience, richindustr knoledge and multidimensional

skills# The form a formidable think tankith their industr knoledge,understanding of client reEuirements,processes and ke client backgrounds

Reliance Global 8anagement/er+ices %7) Limited


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Reliance Life /ciences %Rabale, India), is buildinga protein manufacturing facilit at the !hirubhai$mbani Life /ciences enter at Rabale, near8umbai#

The compan has in+ested more than Rs& billion%02(( million) to build the comple-, hich ill beReliance*s first such facilit# It ill use mammaliancell and microbial fermentation technolog to

produce proteins#

The protein plant ill ha+e initial capacit for1(,((( liters of mammalian cell culture and 1,(((

liters of microbial cell culture #

Reliance Biopharmaceuticals


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Reliance resh to become a separateentit Reliance Industries is likel toturn their consumer retail pro


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R9$L is a Reliance Group ompan dedicated to9ngineering procurement and construction of+arious pro


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These parts are used in a ide range ofdemanding and critical end'useapplications# Building on this coree-pertise#

Reliance 9ngineering pro+ides contractmanufacturing ser+ices for originaleEuipment manufacturers#

This ser+ice includes procurement to rigidspecifications and build'to'printassembl oflo to moderate +olume products#

Reliance 9ngineering $ssociates7ri+ate Limited %R9$L)


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1C

In 2((2, Reliance found natural gas in therishna Goda+ari basin off the coast of$ndhra 7radesh near Hishakapatnam#Reliance Industries %RIL) commenced

natural gas production from its !'6 block inthe rishna'Goda+ari %G) basin# The gasreser+e is C trillion cubic feet in siFe#9Eui+alent to 1#2 billion barrels %16 million

tonnes) of crude oil, but onl trillion cubicfeet are e-tractable#

Reliance atural gas

BCG MATRIX


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BCG MATRIX


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1&1&

RelianceBCG Matrix

!ogs%JLo groth,Lo marketshare)Reliance

7etrochemicals

IH

ash os%JLo

groth, "igh marketshare)%Reliance :il ;Gas,Reliance

Biopharmaceuticals,RelianceRanger farms Ltd)

III

Kuestion 8arks%J "ighgroth, Lo market share)

R9LI$9 79TR:L9.8

I

/tarsII%J"ighgroth,"ighmarketshare)

5amagarRefinar,Reliance

Global 8G8T/er+ices,Reliance9ngineering$ssociated ltd%Real),Reliance

Retail ltd%RRL)

Relati+e 8arket /hare 7osition

"igh1#(

8edium#(

Lo(#(

Indust

r/alesGro,

thRate

"igh2(

Lo'2(

8edium

(


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5ustification= %/T$R)=5$8$G$R R9I9RM= The rating on RelianceIndustries Ltd# reflects the compan*s global scale ofintegrated operations ith a strong competiti+e position inits core petrochemical and oil refining business and

intermediate financial risk profile#R9LI$9 GL:B$L 8$$G989T /9RHI9/=InThe /cenario :f Reliance Global 8anagement /er+ices"as $chie+ed $ onsiderable 7osition In The @orld8arket# Besides $ll These actors $ "igh In+estment $nd

Groth Rate Is Being 7rocured#R9LI$9 9GI99RIG $//:I$T9/ %7)LT!=Reliance engineering associates %p) ltd has not beenin form of pro+iding lot of amount as per current baseNhence it needs lot of amount to stand the business#

RelianceBG 8atri-


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5ustification= %/T$R)=R9LI$9 R9T$IL=Reliance Retail isthe retail business ing of the Reliancebusiness ha+ing high groth rate andhigh market share# The are not forlong term in+estment but thegenerated cash for the organiFation

5ustification#

RelianceBG 8atri-


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5ustification= %K.9/TI: 8$R)

R9LI$9 79TR:L9.8 LT!= In thecurrent reliance market condition, this issomething eEualiFing to high groth rateand lo or optimum in+estment#

RelianceBG 8atri-


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5ustification= %$/":@/)R$G9R $R8/ LT!= Ranger armdeals in food , fruits and +egetables andconsumer products hasn*t achie+ed a

dominant market position, that*s hat don*tgenerate much cash# @e need much cashbecause things are changing e+er minutein Reliance Retail of the market conditionsto stand the firm rigidl# lo groth and

high in+estment is primaril obser+ed#

RelianceBG 8atri-


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5ustification= %$/":@/)

R9LI$9 BI:7"$R8$9.TI$L/= RelianceBiopharmaceuticals is pro+iding orld'class therapies andrecombinant biopharmaceuticals for the treatment of bothacute and chronic diseases in 9uropean market# ThisreEuires focused efforts at keeping large amount of cashto gro their market share#

R9LI$9 :IL/ ; G$/= rishna'Goda+ari %G) !'6 block is amongst the fi+e largest deepater gas pro


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5ustification= %!:G/)

Reliance 7etrochemicals=Re+enue for the

petrochemicals segment for the ear 2(('2((&decreased marginall from Rs 3,((( crore to Rs#2,C6C crore %./0 1(#4 billion)# $ccording torecession period it had lo market share in a

highl lo groth market #

RelianceBG 8atri-


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GE Nine-cell Matrix

It is based on the pioneering eorts o the !eneral"lectric #!"$ co%pany o the united statessupported by the consulting ir% o &c'insey (co%pany)

*he nine cells o the !" %atri+ are grouped on thebasis o lo to high industry attractieness, andea. to strong business strength)

*hree /ones o three cells each are %ade,

denoting dierent co%binations represented bygreen, yello and red colours)


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GE Nine-cell Matrix

Green Oone=' *he signal is go ahead to groand build, indicating e+pansion strategies)

Mello Fone-the signal is ait and seeindicating hold and %aintain type o strategies

i%ed at stability and consolidation) Red Fone- the signal is stop indicating the

retrench%ent strategies o diest%ent andli4uidation or the rebuilding approach or adopting

turnaround strategies)


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GE Nine-cell Matrix


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GE NINE CELL MATRIX

3I!./TRM $TTR$TIH99//

"IG"

L:@

L:@

"IG"

M9LL:@-Reliance

communication-Reliance 7oer

GR99'7etroleum Refining

; 8arket Business':il ; Gas9-ploration 7roduct' Big 9ntertainment

GR99

R9! M9LL:@'Reliance apital

'RelianceInfrastructure

'Reliance Retail

GR99

R9!R9LI$9

79TR:"98I$L/

R9!'

M9LL:@

89!I.8

89!

3:879TITIH97:/ITI:


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Hofers product ar!et e"olution atrix

5oer6s and schendel proposed a 17 cell %atri+,that considers the stages o deelop%ent o theproduct or %ar.et and the co%petitie position odierent businesses in a co%pany6s corporate

portolio)


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Hofers product ar!et e"olution atrix

business in the deelop%ent or groth stage hasa potential to be a star)

I the %ar.et share is large in these groth orientedstages, %ore resources %ust be inested to deelop

co%petitie position) 8ut i %ar.et share is lo, a strategy to i%proe the

sa%e %ust be deeloped)

I the industry is relatiely s%all and %ar.et share is

lo despite high groth stage, %anage%ent %ustconsider diesting and redeploying resources inother co%petitie business)

H#$ER% &R#'(CT MAR)ET


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H#$ER % &R#'(CT MAR)ET

E*#L(TI#N MATRIX


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Reliance and t+e Indian Econo,

9eliance group6s leadership position in the Indianecono%y, is relected in its all-round contribution

- 3: o India6s !;P

- 7: o India6s total e+ports

-


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Leaders+ip in t+e Corporate %ector

9eliance group6s pre-e%inent role in the Indian corporate sector

- 30: o the total proits o the priate sector

- 10: o the proits o the entire corporate sector

- oer 12: o total %ar.et capitalisation

- eightage o 22: in the =ense+

- eightage o 1>: in the


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@ ;ate o irst IPAB all igures are or 9IC ( 9PC

Consistent Trac!-Record of &rofitale Gro.t+

Do%pounded nnual 9ate o !roth #:$

=ince 1>EE@ 10 Year7 Year

=ales 33 ?0 70


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Corporate &+ilosop+,

Gorld scale, and orld class

=tate-o-the-art technologies

!lobal co%petitieness

Ceadership in chosen areas o business

=uperior ProHect "+ecution

Financial Donseratis%

5ighest standards or 5ealth, =aety and "niron%ent

Donsistent oerall shareholder alue enhance%ent

RelianceReliance

benchmarksbenchmarks

itself withitself with

global bestglobal best

practicespractices

in all aspectin all aspect

of itsof its

operationsoperations


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(

9s) crores bn 9an.

=ales 0,00012) 1

"+ports >,0001)> 1

Dash Flo E,0001)7 1 1

Reliance is the largest, fastest groing, and the most +aluablebusiness group, in India '


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$inancial #1ecti"es

"%phasis on capital productiity, and returns, to generateattractie spreads oer cost o capital

*argets o %ini%u% 20: 9A", and 20: 7 year "P= D9!,

across business cycles

Donseratie gearing - %aintain top end credit ratings


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:perating 9n+ironment

K1 M 2((1'(2


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#peratin2 En"ironent

Aperating %argins or the global petroche%icals industry ere

under considerable pressure in Q1

=igniicant capacity additions in the petroche%icals industry in

the &iddle "ast and sia, and the K= slodonLLLL)caused a sharp decline in international and do%estic selling

prices o %aHor petroche%icals products

In addition, continuing olatility in crude oil prices led to olatility

in prices o the principal petroche%icals eedstoc., naphtha

he global petrochemicals industr! is witnessing amongst themost challenging conditions in its histor!


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C+an2e in feedstoc! and product prices

D change in international prices K1 M(2 o+er K1 M(1

/elling 7rices of 7roducts%./0?8T) P" -12: PP -10:

PMD -2>: PAY ->: P=F -1?: P* ->: &"! -21: PN -1:

L))but international selling pricesof products declined sharpl

Ra 8aterial osts

Drude oil #Obbl$ -1:


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D change in domestic prices K1 M(2 o+er K1 M(1

/elling 7rices of 7roducts%Rs?kg) P" -: PP 0:

PMD -10: PAY 3: P=F ->: P* -: &"! -11: PN :

PP# but domestic selling prices of

most products also declined

Ra 8aterial osts

Drude oil #Obbl$ -1:


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RILs 30 &erforance Hi2+li2+ts

Plants operated at aerage capacity utilisation rate o 103:Production olu%es increased E: to record 2) %illion tonnes

;o%estic %ar.et sales accounted or nearly >0: o total sales

"+ports stood at K= 17> %illion #9s) E?> crores$ e+ports

ere 9s) crores per annu% Hust 7 years bac.

&ar.et shares ere 77: or polyester, EE: or polyester

inter%ediates, and 70: or poly%ers

RIL has maintained its track record of strong operationalperformance despite challenging industr! conditions


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Financial Peror%anceFinancial Peror%ance

Q1 FY 2001-02Q1 FY 2001-02

RIL I % f 30 $4 5660 65


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K1 M 2((1'(2 K1 M 2((('(1 D hange

Rs#crs# 0 mn# Rs#crs# 0 mn#/ales 6,3&( 1,3 6,136 1,3C3 4D

Trading /ales ' ' 4C& 1(C

9BIT!$ 1,3(2 2CC 1,23 2C D

Interest 27E 77 2> E -1?:

!epreciation 3> ? 3 2

Ta- 30 2

!eferred Ta- 1

et 7rofit 61 131 43 122 14D

ash 7rofit 1,0?7 222 >3E 210 12:

RIL Incoe %tateent for 30 $4 5660-65

"et Profit increased #$% in a difficult operating environment

RIL7R&L I % f 30 $4 5660 65


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K1 M 2((1'(2 K1 M 2((('(1 D hange

Rs#crs# 0 mn# Rs#crs# 0 mn#

Gross /ales 1,2 3,243 12,& 2,2( 21D

9BIT!$ 2,23 4C 1,66 41 2(D

Interest 700 10 ?E0 107

!epreciation 7>7 12 701 112

Ta- 1? 72 12

et 7rofit 1,(C4 22 43 1& 2CD

ash 7rofit 1,E37 3 1,3> 313 2?:

RIL7R&L Incoe %tateent for 30 $4 5660-65

RIL and RPL have combined cash flows of Rs& #,'() crores*+S -.. mn/ in 0#

&rofora Consolidated RIL Incoe


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K1 M 2((1'(2Rs#crs# 0 mn#

RILs 9BIT!$ 1,3(2 2CC

Income from $ssociates 243 2

and /ubsidiaries

Interest 2

!epreciation 3&6 4

Ta- 3( 6

!eferred Ta- 1 '

et 7rofit 6( 13

&rofora Consolidated RIL Incoe

%tateent for 30 $4 5660-65

he true picture of RIL1s profitabilit! is reflected b! theproforma consolidated income statement, which includes

financials of subsidiaries, RPL, RCL, RIIL and S3S


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Eleents of RILs Net &rofit Gro.t+

5igh capacity utilisation rates leading to olu%e groth5igher proportion o sales in do%estic %ar.et

Increased share o speciality products, contributing higher

%argins

Productiity i%proe%ents and cost reduction

Interest cost saings, oing to loer debt and reinancing

;iidends o only 9s) 1 crores #K= 3)? %n$ ro% 9PC

accounted in Q1 on pro-rata basis total diidends on 9eliance6s

?: sta.e or ull year 9s) 173 crores #K= 33 %n$

Profit growth arising from successful twin business strategies

of improving sales realisations and lowering costs


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omposition of 4D /ales Re+enue Groth

Impact of +olume groth6D

Impact of price changes '2D

RIL - Eleents of %ales Gro.t+

7roduction +olume up CD to 2# million tonnes

:+erall a+erage capacit utilisation rate Q 1(3D

7olmers capacit utilisation rate 11(D, polester &D and

polester intermediates 1(D


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RIL &rofitailit, Ratios

RIL has amongst the highest Returns on 34uit! *R53s/amongst the top petrochemicals companies globall!

K1 M 2((1'(2K1 M 2((('(1

:78 D 1#4D1C#4D

78 D CD#&D

R:9 D 1#3D16#4D

97/ ' Rs# %0) 23#4%(#()2(#4 %(#46)

ash 97/ ' Rs%0) 3#%(#2)34#3 %(#CC)

@ e+cluding FN gains

& f C lid t d & fit ilit R ti


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Proforma consolidation of financials, to include income fromsubsidiaries, RPL, RCL , RIIL and S3S, reflects the true

picture of returns on RIL1s investments

K1 M 2((1'(2

78 D 13#D

R:9 D 2#2D97/ ' Rs# %0) 32#6%(#6&)

&rofora Consolidated &rofitailit, Ratios

RIL Li8uidit, Ratios


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RIL Li8uidit, Ratios

RIL1s financial strength is reflected b! its conservative li4uidit!

ratios and top end credit ratings

K1 M 2((1'(2M 2((('(1

!ebt = 9Euit 0)30)E2

Gearing ??:?1:

Interest o+er 3)7+3)3+

Total !ebt?ash lo 2)01)

C i $i i l M


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Conser"ati"e $inancial Mana2eent

credit ratings ro% D9I=IC and FI*D5 or do%estic debt International debt rated 88 #=table outloo.$ ro% =(P and 8a2

ro% &oody6s constrained by soereign ceiling

Geighted aerage %aturity o oreign e+change deno%inateddebt o K= 1,300 %n #9s) ,000 crores$ is 21 years

nnual ore+ deno%inated interest liability coered %ore than E

ti%es by K= deno%inated e+ports, and oil and gas reenues

Reliance1s strong financial position provides a high degree of

financial fle6ibilit! to capture future opportunities

R li i I di L E


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Reliance is Indias Lar2est Exporter

9eliance is India6s largest e+porter ith group e+ports o K= 2

bn #9s) >,3E0 crores$ in FY 2001

Indiidually too, 9IC and 9PC are India6s top 2 e+porters

9IC6s %anuactured e+ports declined 10: to K= 17> %n #9s)

E?> crores$ in Q1

9IC e+ports products to oer 100 countries, including to the

%ost 4uality conscious custo%ers in the K= and "urope

9IC recently beca%e India6s irst %anuacturing entity to receiethe status o !olden =uper =tar *rading 5ouse

Reliance1s high e6ports demonstrate the international 4ualit! of

its products, and its abilit! to compete against global leaders

C i G + i E R


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Consistent Gro.t+ in Exports Re"enues

36ports still represent onl! #)% of total sales even after 7

times increase in absolute terms over the last . !ears

6 1(C 366 61,4C 2,&6(

C,C6 ,C3(

13,4(414,33

1&,&6

2,C31

(

(((

1((((

1(((

2((((

2(((

3((((

3(((

&'&6 &6'&C &C'& &'&& &&'(( (('(1

9-ports Total /ales

Rs#crores


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8usiness 9eie8usiness 9eie

& d t Mi


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&roduct Mix

omposition of RILs sales

Petrochemicals businesses dominate RIL1s portfolio, with an7'% share of sales 8 share of oil and gas business likel! toincrease

hemicals

1(D

7lastics ; Int#

32D

abrics

1D7olester

22D

ibre Int#

32D

:il ; Gas

3D

#il 9 Gas Re"ie.


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C1

#il 9 Gas - Re"ie.

9IC is India6s largest priate sector "(P operator in India


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Reliances 7roduction K1 M(2 K1 M(1 Dhange

Ail #in .*$ 100 >2 :

!as #in .*A"$ 17 17E :

#il and Gas - Existin2 &roduction

5utput from the 2 currentl! producing oil and gas fields of

Panna:;ukta and apti *P;/ has further increased in 0#

he -% share in RIL1s revenues b! 5il and


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C3

eliance s #il 9 Gas ope ties/"$LL:@ @$T9R BL:/8CAD' 1 'utch Ashore8CAD' 2 =aurashtra8CAD' 3 =aurashtra @8CAD' ? &u%bai Ashore8CAD' 7 &u%bai Ashore

8CAD' 'erala-'on.an8CAD' 1 'rishna !odaari8CAD' 1> 'rishna !odaari8CAD' 20 'rishna !odaari8CAD' 27


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&ol,ester - Bac!2round

Ceading global ran.ings, and loest cost positions

- 2nd largest producer o P=FOPAY

- 3rd largest producer o PN

- ?th largest producer o P*

=trong de%and potential in do%estic %ar.ets - per capitaconsu%ption a%ongst the loest in the orld

5igh tari protection re%oed - i%port duties already at restingpoint o 20:, as per the G*A bound rates

nti du%ping duties i%posed on PAY e+ports ro% leadingregional producers, to counter unair co%petition

he Indian pol!ester market has witnessed compounded

double digit annual demand growth rates over 2 decades

&ol,ester - Re"ie.


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&ol,ester - Re"ie.

Present capacity o PAY, P=F and P"* >00,000 tonnes per year

to be increased 33: to 1)2 %illion tonnes per year, in ne+t 2 years

Dapacity e+pansion planned through attractie ac4uisition deals,

and building cost co%petitie acilities at e+isting sites

9IC is the only player %a.ing inest%ents to capture uture groth

opportunities in polyester in India

9IC6s %ar.et share o PAY, P=F and P"* has gron to 77: -

relecting ac4uisitions o 270,000 tonnes oer the past e years

=emand fundamentals point to sustainable double digit growth

rates for pol!ester in India in the medium to long term

& l t E i ti & d ti


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&ol,ester - Existin2 &roduction

Industr Reliance

#Production in Q1 Q1 : Q1 Q1 :R000 tonnes$ FY602 FY601 change FY602 FY601 change

Polyester 3E0 3?> : 207 1E 17:

#PFY, P=F, P"*$

Inter%ediates 0 >1 -1: 1 E2 -:

#P*, &"!, PN$

7olester demand groth of 6D Euarter'on'Euarter

& l B ! d


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CC

&ol,ers - Bac!2round

9eliance a%ongst the top 10 players globally in poly%ers

India the orld6s astest groing poly%ers %ar.et

Ci.ely to be the orld6s third largest %ar.et ithin this decade

9IC6s %aHor poly%er, PP, accounting or 0: o production,

itnessed de%and groth o oer 1>: this year

I%port taris already don to 37: - gradual urther reduction by

7: per year oer the ne+t 3 years

RIL enjo!s a leading .)% share in the rapidl! growing pol!mersmarket in India

&ol,ers Existin2 &roduction


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&ol,ers - Existin2 &roduction

Industr Reliance#Production in Q1 Q1 : Q1 Q1 :

R000 tonnes$ FY602 FY601 change FY602 FY601 change

Plastics 3E E0E 1: ?1 3E :

#P", PP, PMD$

Pol!mers demand growth of #'% 4uarter on 4uarter

>igher industr! production growth rate reflects impact of

capacities of new pla!ers operating at higher rates compared to

the last !ear


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C&

PAY 2: E70 - 12,000 2: - 2E:

P=F 7>: 2,00 - 10,200 7: - 1>:

P" 21: 7 - ,77 1): - 1:

PP 20: 330 - 3,330 1: - 10:

Ep+asis on Hi2+er Mar2in %pecialit, Grades

=peciality as : Pre%iu% oer

o *otal Molu%e Do%%odity

Q1 FY602 #9s)O&*$ #:$

Specialit! grades !ield premium pricing and contribute to highermargins, product differentiation, and relative insulation fromcommodit! c!cles


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(

9eliance Petroleu%9eliance Petroleu%

R&L - :orld class refiner,


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1

Dapacity o 7?0,000 bOd

co%parable to K= and"uropean supersites

Gorld6s largest greenield

reinery and Eth largest in the

orld

Do%ple+ity at top end o global

range

Dapability to produce higher

alue products ro% loer

cost, heaier grade crude

R&L :orld class refiner,

US supersites refer to a sample of refineries with capacities of at least 225 kbpd and complexities of at least 9.5

European supersites refer to a sample of refineries with capacities of at least 245 kbpd and complexities of at least 6.5

Certain US and European supersites include petrochemical facilities

Sources !"#$ %ood &acken'ie

Comparisons

kb(d

0

100

200

300

400

500

600

RPL US supersite European

supersite

0

2

4

6

8

10

12

14

Complexit)*ndex

Shell Singapore

Reliance

JanagarUS supersite European

supersite

Shell Singapore

16

RIL

Petrochem

plants

RPL

refinery

R&L &eer coparisons


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2

R&L - &eer coparisons

Source Stud) b) Solomon +ssociates$ *nc. on !"# ,&arch -999

-. *ndian peers refer to se/en *ndian refineries that participated in the -996 stud) b) Solomon +ssociates$ *nc.

2. +sian peers refer to four refineries that are amon0 the better refineries in +sia accordin0 to Solomon +ssociates$ *nc.

1. US pacesetter refineries represent a 0roup of se/en refineries located in the U.S. and Canada$ which ha/e achie/ed first or second

uartile rankin0s in all of the ma3or indicators in the past three or four studies b) Solomon +ssociates$ *nc.

4. Europe pacesetter refineries refer to a 0roup of six refineries located in Europe which ha/e achie/ed similar rankin0s as the US pacesetter refineries

Total cash operating costs Energy intensity index

Crude sulfur Crude gravity

(

1(

12(

2

3(3

4(

Indian peers $sian peers 9uropepacesetters

./pacesetters

R7L

US cents / Utilied E!uivalent "istillation Capacity

(

2(

4(

6(

(1((

12(

Indian peers $sian peers 9uropepacesetters

./pacesetters

R7L

(#(

(#

1#(

1#

2#(

2#

I ndi an pe ers $si an p ee rs 9urope

pacesetters

./

pacesetters

R7L

#eight $

26

2

3(

32

34

36

3

Indian peers $sian peers 9urope

pacesetters

./ pacesetters R7L

"egree %PI

R&L - Hi2+er GRMs


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3

! Do%ple+ity

! !ood product it

R&L Hi2+er GRMs

! Co crude deliery

cost

! Faorable tarieniron%ent

;riers o high reining %argins

! Fiscal

beneits

(

1

2

3

4

6

C

$pr'5une*(( 5ul'/ep*(( :ct'!ec*(( 5an'8ar*(1 $pr'5une*(1

R7L

./ Gulf oast

8editerranean

Rotterdam

/ingapore

,

?b

b l

R&L ; Consistent Increase in #peratin2 Rates


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4

9PC6s record capacity utilisation rate o 10: is ar ahead o the

aerage 7: or other reineries in India and sia Paciic region, :or "urope, and >2: or 7:

10:

0:

7:

>0:

>7:

100:

107:

110:

Q1 FYS01 Q2 FYS01 Q3 FYS01 Q? FYS01 Q1 FYS02

R&L - Incoe %tateent for 30 $4 5660-65


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R&L Incoe %tateent for 30 $4 5660 65

R% is Indias largest company in terms of sales and is secondonly to RI% in terms of net profits, net worth, and assets

K1 M 2((1'(2 K1 M 2((('(1 D hange

Rs#crs# 0 mn# Rs#crs# 0 mn#

Gross /ales ,6 1,4 ,&3 1,33& 4D

9BIT!$ &33 1& 631 141 4D

Interest 2?3 72 1E2 3>

;epreciation 1>> ?2 137 30

*a+ 37 E 2? 7

et 7rofit 46 &C 3(( 6C 2D

Dash Proit >0 1?E ?7> 103 70:


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6

Eleents of R&Ls Net &rofit Gro.t+

5igh capacity utilisation rates o 10: leading to 2: olu%egroth ro% 7) to E)3 %illion tonnes

Increased processing o heaier and relatiely less e+pensie

arieties o crude oil

I%proed product %i+ to ta.e adantage o niche opportunities

I%port tari rationalisation in Actober, 2000, as ell as in &arch

and pril, 2001, leading to higher eectie i%port tari dierentials

Angoing productiity gains and cost reductions

'trong volume growth and superiority of R% refinerysconfiguration have contributed significantly to net profit growth

R&L - &rofitailit, Ratios


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C

R&L &rofitailit, Ratios

RPL1s R53 ranks amongst the highest in refining companiesgloball!

K1 M 2((1'(2K1 M 2((('(1

AP&: 10)3:10)3:


75/91

8 ,

(() rating from *RI'I% and +I*- . a uni$ue achievement for a

company of this scale in /ust over a year of operationsRecently concluded Indias largest syndicated loan facility for 0'1

"5# mn Rs3 4,5## crores . enhancing financial fle6ibility

K1 M 2((1'(2M 2((('(1

;ebt "4uity 0)>0)

!earing ?E:??:

Interest Doer 3)32)>

*otal ;ebt O Dash Flo 2)22)3

R&L - Indias Lar2est Exporter


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&

2 p

9PC is India6s largest e+porter ith e+ports o K= 1,3E7 %n #9s)

,?10 crores$ in FY 2001

Q1 e+ports o 9PC6s products hae increased 200: to K= 30 %n

#9s) 1,??0 crores$

"+ports to the K= and other discerning %ar.ets relect

!global co%petitieness

!international 4uality o products

!operational le+ibility!orld class logistics capabilities

R%s ability to deliver international $uality products provides asignificant competitive edge in a decontrolled environment

Inte2ration .it+ Mar!etin2


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&(

2 2

9PC proposes to enter the business o retail %ar.eting o controlledproducts in India, in line ith goern%ent policies

9PC is currently ealuating a %ulti-pronged strategy, enco%passing

- potential Hoint entures and alliances

- ac4uisitions o %ar.eting and distribution assets, andOor

- deelop%ent o its on distribution and %ar.eting inrastructure

9PC6s &e%orandu% A Knderstanding ith Indian Ail Dorporation

or or%ation o a JM or %ar.eting, and the co%pany6s participation in

the process or disinest%ent o I8P, relect this strategy

R%s entry into marketing will enhance integration and provideopportunities for generating attractive returns


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9eliance *eleco%9eliance *eleco%

Reliance Teleco - Re"ie.


79/91

&2

Reliance Teleco - Re"ie.

17: groth in cellular subscriber base oer last one year

double the industry groth rate o E:

Durrent subscriber base o oer 23,000 ith serices in 113 cities

across 17 states

Ceading %ar.et shares in all E circles

Pre paid account or >0: o cellular reenues lo ris. strategy

=trength o 9eliance &obile brand and e+pertise in building retail

consu%er ranchise de%onstrated

Reliance1s e6isting mobile operations span #?-rd of India1sgeographical area and cover nearl! $)) million people


80/91

9eliance Inoco%9eliance Inoco%

Reliance Infoco - Re"ie.


81/91

&4

9eliance Inoco% to be the holding co%pany or all inoco% and

related businesses o 9eliance group

9eliance Inoco% to inest up to 9s) 27,000 crores #K= 7 bn$

oer the ne+t 7 years

ProHect proposed to be inanced ith 21 debte4uity

9IC is the lead inestor ith ?7: e4uity sta.e

Reliance Infoco Re"ie.

Reliance is leveraging its superior project e6ecutioncapabilities and successful e6perience in telecom business

Reliance Infoco - (pdate


82/91

&

First co%pany to receie licences or proiding i+ed line serices

in 1 circles national ootprint e+cluding *a%ilnadu and J('

Fi+ed line licences also enable tapping o %obile seg%ent through

lo cost GiCC serices in addition to e+isting !=& business

First co%pany to receie


83/91

&6

Plans announced or Indian teleco% %ar.ets by seeral do%estic

and international players scrapped

Donsolidation o teleco% industry in India gathers pace

=igniicant reduction in e4uip%ent and ibre costs oing to global

teleco% slodon and cancellation o large nu%ber o proHects

Phased approach by 9eliance toards inoco% inest%ents,

based on

!strong cash los

!attractie I99s

!lo paybac. period

Reliance Infoco (pdate

Reliance Infocom is building amongst the lowest costintegrated communications networks in the countr!


84/91

=u%%ary=u%%ary

Indias Top < :ealt+ Creators in 5666-60


85/91

&

%Rs#crs) %./0 mn) %Rs#crs) %./0 mn)

RIL 41,1&1 ,3 ,(1 1,C2C

IT 1&,& 4,2C 1,&4 41

"! 6,4&( 1,3&2 1,&4C 41

B7L ,C1C 1,226 1,C6 3C&

estle 4,C& 1,(4C 1,2C( 2C2

Total C,26 16,C 14,&1 3,213

8kt# ap on

31'8ar'(1

$ddition in

2((('(1

RIL is the "o& # wealth creator in the !ear 2))):)# : wealthcreation e6ceeds the ne6t compan! b! a factor of $ times

RILs %uperior %+are &rice &erforance


86/91

&&

p f

RIL shares have consistentl! outperformed the broad marketover all time frames

D change

7eriod RIL /ense- ift

Mear to date 'D '1CD '16D

1 ear 'D '23D '2(D

2 ear C6D '2D '1&D

3 ear 12&D 2D 14D

ear 2(4D 'D D

/ince 1&&4 3D '24D '

1( ear 2CD 1((D '@ Cast e4uity place%ent ro% 9IC

Returns fro RIL to $inancial Institutions


87/91

1((

Returns fro RIL to $inancial Institutions

$mount %Rs# crores)

7ri+ate placement in :ctober 1&&4 &4

urrent +alue of RIL shares %4#& crore shares SRs# 313) 136

Income from di+idends including rein+estments 1(

Total profit earned b Is till date C41

7rofit from an eEui+alent in+estment in /ense- '14%including di+idends and rein+estments)

Total returns o+er market returns &

.TI, LI, and GI ha+e earned total returns of Rs# & crores o+er

market returns, on their original in+estment of Rs# &4 crores

RIL stock price has appreciated 3D from its placement price,

outperforming the /ense- b CCD o+er this period

Reliance Industries Ltd#

&rice &erforance of Leadin2 Index Mo"ers


88/91

1(1

&rice &erforance of Leadin2 Index Mo"ers

D change

7eriod RIL "LL IT

Mear to date 'D 6D '14D

1 ear 'D 'D 3D2 ear C6D '2(D '22D

3 ear 12&D 2CD 22D

ear 2(4D 16(D 1C(D

he RIL stock is the best performing inde6 heav!weight overvirtuall! all time frames

R&Ls %uperior %+are &rice &erforance


89/91

1(2

p f

D change

7eriod R7L /ense- ift

1 ear '&D '23D '2(D

2 ear 4&D '2D '1&D

3 ear 12D 2D 14D

ear 26(D 'D D

RPL shares have outperformed the broad market over all timeframes, creating superior value for both RPL and RILshareholders

%uar,


90/91

1(3

%uar,

Production olu%es in e+isting petroche%icals business li.ely to

cross 11 %illion tonnes in the current year!lobal petroche%icals operating %argins li.ely to re%ain under

pressure during the current year

9IC6s inest%ent in 9PC no generating attractie returns9IC6s uture inest%ents in Ail and !as and inoco% to generate

signiicant returns in the %ediu% to long ter%

9IC6s proor%a consolidated "P= o 9s) 32) #K= 0)>$ relects

the true picture o returns on its oerall inest%ents

RIL will endeavour to maintain its demonstrated andconsistent track record of shareholder value enhancement


91/91

Reliance Industries Limited

Indias @orld lass orporation

65260881 presentation reliance industries ltd

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