reliance infrastructure ltd Management discussions


Forward Looking Statements

Statements in this Management Discussion and Analysis of financial condition and results of operations of the Company describing the Companys objectives, expectations or predictions may be forward looking within the meaning of applicable securities laws and regulations. Forward-looking statements are based on certain assumptions and expectations of future events. The Company cannot guarantee that these assumptions and expectations are accurate or will be realised. The Company assumes no responsibility to publicly amend, modify or revise forward-looking statements on the basis of any subsequent developments, information or events. Actual results may differ materially from those expressed in the statement. Important factors that could influence the Companys operations include determination of tariff and such other charges and levies by the regulatory authority, changes in Government regulations, tax laws, economic developments within the country and such other factors globally.

The financial statements of the Company are prepared under historical cost convention, on accrual basis of accounting and in accordance with the provisions of the Companies Act, 2013 (the "Act") and comply with the Companies (Indian Accounting Standards) Rules. 2015 prescribed under Section 133 of the Act, The management of Reliance Infrastructure Limited (Reliance Infrastructure" or "Reliance Infra" or "the Company") has used estimates and judgments relating to the financial statements on a prudent and reasonable basis, in order that the financial statements reflect in a true and fair manner, the state of affairs and profit/loss for the Financial Year.

The following discussions on our financial condition and result of operations should be read together with our audited consolidated financial statement and the notes to these statements included in the annual report.

Unless otherwise specified or the context otherwise requires, all references herein to we", us", our", the Company", Reliance Infra", Reliance" or Reliance Infrastructure" are to Reliance Infrastructure Limited and its subsidiary companies and associates.

About Reliance Infrastructure Limited:

Reliance Infrastructure Limited is an infrastructure company, developing projects through various Special Purpose Vehicles (SPVs) in several high growth sectors such as power, roads and metro rail in the infrastructure space, the defence sector and Engineering and Construction (E&C) sector.

Fiscal Review:

The Companys total consolidated income for the year ended March 31, 2023 was Rs 23,1 96 crore (USD 2.82 billion) as compared to Rs 19,271 crore (USD 2.54 billion) in the previous Financial Year.

The total income includes earnings from sale of electrical energy of Rs 20,316 crore (USD 2.47 billion) as compared to Rs 15,879 crore (USD 2.10 billion) in the previous Financial Year.

During the year, interest expenditure increased to Rs 2,393 crore (USD 291 million) as compared to Rs 2,060 crore (USD 272 million) in the previous year.

The capital expenditure during the year was Rs 1,240 crore (USD 151 million), incurred primarily on modernizing and strengthening of the transmission and distribution network as also on road projects.

The total Plant Property and Equipment as at March 31, 2023 stood at Rs 9,048 crore (USD 1.10 billion).

In order to optimise shareholder value, the Company continues to focus on in-house opportunities as well as selective large external projects for its E&C and Contracts Division. The E&C and Contracts Division (the E&C Division) has a total order book position of Rs 6,653 crore (USD 0.81 billion).

The Companys consolidated net worth was Rs 9,294 crore (USD 1.13 billion).

Details of significant changes in Key Financial Ratios and Return on Networth:

The details of significant changes amounting to change of 25% or more as compared to the immediately previous Financial Year in Key Financial Ratios and Return on Networth along with detailed explanations therefore are given in Note no. 48 to the standalone financial statement

Update on various liquidity events:

1. Delhi Airport Metro Express Private Limited (DAMEPL) vs Delhi Metro Rail Corporation (DMRC) - Execution of Supreme Court Decree of September 2021

In the matter of arbitration dispute between DAMEPL, a subsidiary of the Company and DMRC, DAMEPL has thus far received a sum of Rs 2,599.18 crore from DMRC, based on undertakings by DMRC before Honble Delhi High Court. The entire proceeds have been utilized to repay DAMEPLs Lenders. The balance decretal sum to be recovered from DMRC as on the date of this report is Rs 4,757.30 crore.

In DAMEPLs execution proceedings, Honble Delhi High Court had impleaded the Union of India and Government of National Capital Territory of Delhi (GNCTD) and had passed an order in March 2023 directing as follows:

(a) The Union of India and GNCTD to consider DMRCs requests for sovereign guarantees/subordinate debt in 2 weeks. Upon receipt of the same, DMRC was directed to deposit the entire awarded sums with DAMEPL in one month.

(b) If DMRCs request was declined, Union of India was directed to repatriate all funds received by it from DMRC within 2 weeks, so as to restore the balance of DMRC accounts as on March 10, 2022. DMRC was thereafter directed to make full payment to DAMEPL forthwith.

(c) In case of failure of the aforesaid options, DMRCs accounts would stand automatically attached.

(d) The Honble Delhi High Court further observed that it would then consider appropriate directions against the Union of India and GNCTD to satisfy the award, consequent to lifting of the corporate veil of DMRC.

The order of March 2023 has been challenged by Union of India, GNCTD and DAMEPL before Honble Supreme Court.

2. Reliance Infrastructure Limited vs Damodar Valley Corporation (DVC) - update on the arbitration award

During December 2019, the Company succeeded in the arbitration invoked by it against DVC. By an unanimous award, DVC was directed to pay to the Company a sum

of Rs 898 crore along with interest and release six Bank Guarantees of the Company aggregating to a sum of Rs 354 crore.

DVC, thereafter, initiated proceedings before Honble Calcutta High Court to challenge the Award. The Company was successful in securing directions upon DVC to secure the award amount before Honble Calcutta High Court with intervention of Honble Supreme Court. DVC furnished a cash deposit Rs 595 crores and Rs 303 crore by way of Bank Guarantee. DVC complied with the directions for furnishing Security in July, 2022 and deposited the same with the Honble Registrar, Calcutta High Court. The Company has withdrawn the money against a bank guarantee and the withdrawn amount is appropriated with lenders. Proceeding initiated by DVC under Section 34 of the Arbitration Act to challenge the Award is being contested before Honble Calcutta High Court.

3. Reliance Infrastructure Limited vs Electricity Department, Government of Goa (GoG)- Supreme Court judgment in favour of the Company upholding the Award in entirety

A dispute had arisen between the Company and GoG on account non-payment of due for supply of power by the Company to GoG in terms of a Power Purchase Agreement dated January 10, 1 997. A petition was filed before the Central Electricity Regulatory Commission, leading to appointment of an arbitrator to adjudicate upon the disputes between the parties.

The arbitral tribunal pronounced an Award in favour of the Company in February, 2018. Proceeding initiated by GoG under Section 34 of the Arbitration Act to challenge the Award was decided in favour of the Company in terms of judgment of September, 2019,

GoG filed petition under Section 37 of the Arbitration Act challenging the above order before Honble Bombay High Court at Goa. In such proceedings, in terms of a judgment delivered in March, 2021, the award was partially set aside and the Company received a sum of Rs 190 crore. The amount received by the Company was appropriated to the lenders of the Company.

Both GoG and the Company challenged the March, 2021 judgment before Honble Supreme Court. The Company has succeeded in the Honble Supreme Court proceedings and by a judgment of May, 2023, the February, 2018 award in favour of the Company is upheld in its entirety.

In terms of May, 2023 judgment, the Company is entitled to receive a sum of Rs 316.24 crore as on May 1 5, 2023 along with further interest. The Company has filed an application before the District Court, North Goa to execute the award and realise the decreetal amount.

4. Reliance Infrastructure Limited vs National Highway Authorities of India (NHAI)- Award in favour of the Company

Disputes arose between the Company and NHAI in respect of the EPC work awarded to the Company for six laning of a road from Aurangabad to Chordaha Section of National Highway- 2 in Bihar which was wrongfully terminated by NHAI and the performance bank guarantee issued by the Company in favour of NHAI were encashed.

By an award pronounced in August, 2022, NHAI has been directed to pay a sum of Rs 109 crore in favour of the Company.

NHAI has filed an application for setting aside of the Award. The Company has also filed a petition for execution of the Award. Both the proceedings are pending before Honble Delhi High Court. Pursuant to the order passed by Honble Delhi High Court in February, 2023, NHAI, as a condition for stay of the Award, has deposited a sum of Rs 86.75 crore in April, 2023. The Company is in the process of furnishing Bank Guarantee to withdraw the amount deposited by NHAI.

5. TK Toll Road Private Limited (TKTRPL) vs NHAI- Award in favour of TKTRPL, a toll-road subsidiary of the Company

TKTRPL had invoked arbitration against NHAI on account of claims towards prolongation, damages for delay, etc. The award has been pronounced in October, 2022 and TKTRPL has succeeded in the arbitration. NHAI has been directed to pay TKTRPL a sum of Rs 1,057 crore (as on the date of Award) plus post-award interest.

Proceedings have been initiated by NHAI under Section 34 of the Arbitration Act to challenge the Award. TKTRPL has also filed a petition for execution of the Award. Both the matters are pending before Honble Delhi Court and listed in July, 2023. Additionally, in terms of applicable NHAI Circulars, TKTRPL is eligible to receive 75% of the Award amount as on date, inclusive of interest, upon furnishing Bank Guarantee of an equivalent amount. TKTRPL is pursuing further steps in this regard.

6. JR Toll Road Private Limited (JRTRPL) vs NHAI- Award in favour of JRTRPL, a toll-road subsidiary of the Company

JRTRPL had invoked arbitration against NHAI on account of claims towards prolongation, delay damages etc. The award has been pronounced in January, 2023 and JRTRPL has succeeded in the arbitration. NHAI has been directed to pay JRTRPL a sum of Rs 33.78 crore as on the date of Award, plus post-award interest. NHAI has filed an application for setting aside the Award. The proceedings are pending before Honble Delhi High Court.

7. GF Toll Road Private Limited (GFTRPL) vs Haryana Public Works Department, Government of Haryana (HPWD)- Award in favour of GFTRPL, a toll-road subsidiary of the Company

GFTRPL had invoked arbitration against HPWD on account of claims towards prolongation, delay damages etc. The award has been pronounced in October, 2022. HPWD has been directed to pay GFTRPL a sum of Rs 149.45 crore, as on the date of Award, plus post-award interest. Pursuant to an application by GFTRPL, seeking additional award on account of revision of toll fee from the due dates along with correction of typographical and clerical errors in the Award, the arbitral tribunal in January, 2023 awarded an additional sum of Rs 15.25 crores in favour of GFTRPL.

HPWD has filed an application for setting aside the Award. The proceedings are pending before the Honble District and Sessions Court, Chandigarh.

The proceeds of the above arbitration would help the Company in repaying its debt obligations.

Operational and Financial Performance of Businesses

We present hereunder detailed report of various business divisions during 2022-23:

A. The E&C Business

The E&C Division is a leading service provider of integrated design, engineering, procurement and project management services for undertaking turnkey contracts including coal- based thermal projects, gas-power projects, nuclear power projects, metro, rail and road projects.

The Division is equipped with the requisite expertise and experience to undertake E&C projects within the budgeted cost and time frame, ensuring customer satisfaction in terms of quality and workmanship. The Division has constructed various Greenfield projects in medium, large and mega categories over the last two decades. E&C Division focuses on execution of orders at hand and envisages consolidating its order book in coming year through targeted bidding of E&C opportunities with scope for Value Engineering.

Following major projects are currently under execution by the E&C Division:

a. Design & E&C of Common Services Systems, Structures & Components for Kudankulam Nuclear Power Unit 3 & 4:

Reliance Infra is providing E&C contract for common services systems, structures and components at Unit 3 & 4 of Kudankulam Nuclear Power Project being set-up by Nuclear Power Corporation of India Limited (NPCIL) in collaboration with the Russian Federation. Civil works are at advanced stage of completion and equipment supplies have already commenced for the project.

b. Mumbai Metro Line 4 - Packages 8, 10 & 12

The Company is executing E&C contract for elevated viaduct and Stations for Mumbai Metro Rail Project

- Packages 8, 10 & 12 which are part of Wadala

- Ghatkopar - Thane - Kasarvadawali Metro which will connect Wadala in Central Mumbai with the neighboring Thane district via the Eastern Express Highway. The corridor will provide more North- South rail connectivity and reduce the burden on the suburban rail network. This project is being carried out as a joint venture of Reliance Infrastructure Limited with WeBuild SpA.

c. Vikkaravandi to Pinalur-Sethiyahopu section of NH-45C in the State of Tamil Nadu

The Project is awarded by NHAI for improvement & augmentation of Four Laning from Vikkaravandi to Pinalur-Sethiyahopu section of NH-45C in the State of Tamil Nadu covering a length of 66 km. The scope of work includes four laning of 66 km with two major bridges and three Road overbridges. The project road is presently a two lane road which is not sufficient to cater to the present traffic. This route is like a chord line which reduces travelling

distance and time to the commuters who wish to reach Thanjavur from Chennai and hence this project gains high importance. The project highway is proposed to be improved & augmented as Four Laning carriageway with service roads.

d. Six laning of highway from Bihar-Jharkhand Border to Gorhar, Jharkhand

Reliance Infra is executing an E&C order from NHAI for Six Laning of Highway from Bihar-Jharkhand Border (Chordaha) to Gorhar section of NH-2 in the state of Jharkhand covering a length of 71.285 km. The project highway consists of three flyovers and two major bridges and also the plantation of around 15,500 trees. This project highway includes up- gradation of existing facilities, construction of new corridors for ensuring safe, smooth and uninterrupted flow of traffic. This project has achieved overall 61% progress till date.

e. Four laning and construction of twin tube six- lane tunnel at Kashedi Ghat, Maharashtra

Reliance Infra, in a joint venture with CAI-Ukraine, is executing an E&C order from MoRTH for Rehabilitation and Upgradation of Kashedi Ghat section of NH-17 (New NH-66) to four lanes with paved shoulders including construction of twin tube six-lane tunnel in the state of Maharashtra on E&C Mode. The Kashedi Ghat to Parshuram section of NH-66 (Old NH 17) is located in the costal districts of Raigad in the state of Maharashtra which consist twin tube six lane tunnel, five viaducts and seven minor bridges. This section creates the accident free and safe flow of traffic on that highway. Overall 80% of progress has been achieved.

f. Nagpur Mumbai Super Communication Expressway - Package 7

Reliance Infra is executing an E&C order from Maharashtra State Road Development Corporation (MSRDC) for construction of access controlled Nagpur-Mumbai Super Communication Expressway (Maharashtra Samruddhi Mahamarg) in the state of Maharashtra on E&C mode for Package 7, from 296.000 km to 347.190 km (section - village Banda to village Sawargaon mal) in district Buldhana. Nagpur - Mumbai Super Communication Expressway is an under-construction 6-lane wide (expandable to 8), 701 km long access-controlled expressway in Maharashtra, capable of providing enhanced connectivity to the Marathwada and Vidharbha region. It will be amongst the countrys longest Greenfield road project, connecting the two capitals of the Maharashtra state i.e. Mumbai and Nagpur. Overall 99% of progress has been achieved.

B. Delhi Power Distribution Companies

The Company has two material subsidiaries - BSES

Rajdhani Power Limited (BRPL) and BSES Yamuna Power

Limited (BYPL) (together called Delhi Discoms). These

Companies are involved in electricity distribution in Delhi.

BRPL caters to around 1 9 lakh subscribers in South

and West Delhi, while BYPL caters to around 30 lakh subscribers in East and Central Delhi.

During the FY22-23, Delhi Discoms registered an aggregate income of Rs 6,518.33 crore (BYPL) and Rs 1 1,880.57 crore (BRPL) against aggregate of

Rs 5,596.67 crore (BYPL) and Rs 10,255.04 crore (BRPL) in the previous year, excluding exceptional items which increased by 14.13% (BYPL) and 13.6% (BRPL) over last year.

The operating expenses are in line with the target and were achieved by following stringent budgetary control and rigorous monitoring of all expenses and commercial processes. The aggregate capital expenditure incurred during the year amounted to Rs 724 crore (BRPL) and Rs 309.25 crore (BYPL) for up-gradation, strengthening and modernization of the distribution network. The aggregate net block including Capital Work in Progress stood at Rs 5229.04 crore (BRPL) and Rs 2563.08 crore (BYPL).

Both the Discoms registered over 4% growth in in the total customer base in comparison with the previous year (BYPL - from 18.30 lakh to 19.04 lakh and BRPL - 28.70 lakh to 29.9 lakh) while maintaining the system reliability of over 99.9%. The Transmission and Distribution (T&D) loss levels at the Discoms remained comparable to international benchmarks with BRPL achieving 7.16% and BYPL achieving 7.27% in FY 2022-23.

During the year, as a result of increased commercial and industrial activities, combined peak demand for BYPL increased to 1,752 MW which is 5.4% up from previous year value of 1,662 MW while BRPL saw an increase of 7.9% from previous year value of 3,118 MW to 3,389 MW.

Key Regulatory updates

Some of the key regulatory highlights of FY 2022-23 are as below

• Delhi Electricity Regulatory Commission (DERC) has issued the last Tariff order on September 30, 2021 which remained in force during the year and Tariff from the consumers have been recovered accordingly.

• Honble Supreme Court (SC) vide its order dated December 1, 2021 has settled the long pending matters by dismissing the six Civil Appeals of DERC and directing DERC for implementation of Appellate Tribunal for Electricity (APTEL) Orders. DERC has filed Compliance Affidavits against which the Discoms have filed Miscellaneous Applications which were allowed by Honble SC by Order dated December 15, 2022 again directing DERC to implement the APTEL Orders. DERC has till date not implemented the Honble SC directions and therefore the Discoms have filed Contempt Petitions against DERC in Honble SC.

• Further, Honble SC on October 18, 2022 allowed the Appeals of Delhi Discoms filed against APTEL Order dated November 28, 2014. DERC is yet to implement the same.

• By its order dated February 8, 2022, APTEL has upheld the appeal by the Discoms and has allowed

them to withdraw from the power purchase agreement with NTPCs Dadri-I Plant and directed NTPC not to raise any invoices i.e. December 1, 2020 and to immediately refund the payment made by the Delhi Discoms under protest along with interest as specified in PPA. NTPC has since refunded the amounts. NTPC has filed appeal in Honble SC against the APTEL judgment.

• Keeping in view, the current scenario on account of impact of blending of imported coal and in order to make timely payments of short-term Power Purchase for maintaining 24x7 supply in Delhi, the Delhi Discoms made a representation before DERC for suitable PPAC. DERC by its Order dated March 16, 2023 directed to continue the PPAC of 20.69% for BRPL and 22.18% for BYPL till June 30, 2023.

• On March 29, 2023, DERC has issued the Business Plan Regulations, 2023 applicable from April 01, 2023. As directed by DERC, Delhi Discoms have filed petition for True-up of FY 2021-22 on December 01, 2022 and are in process of filing ARR of FY 2023-24 before DERC as per the above Regulations.

Consumer Services Digitization and Automation

The Discoms undertook a number of initiatives to ensure digitization and automation of Consumer services and thereby providing enhanced customer experience. The key highlights are as under:

• New connection service & Show Notices/ Acknowledgement service on WhatsApp

• CHD Services - "Take Appointment", "Get a Call Back" & "Virtually Connect "service

• Enhanced Customer Email Module to enhance operational efficiency

"Update Contact Details" (i.e. e-mail, mobile number, e-bill & sms alert) service through Power App

• "Opt for E-bill" - Quick opt in for e-bill service without any need of logging into "My Account"

• Website & Content Management System - To provide all departments /user groups at BRPL with a way to manage digital information on BSES website & BSES Intranet.

• Amazon Alexa Service - Users can now avail below given host of BRPL services through Alexa on Amazon by enabling BSES Rajdhani Power skill:

> Latest Bill Amount

> Bill Due Date

> Nearest Cash Counters

> Meter Reading Date

> Last 5 bills

> Register for E-bill

• Visually Impaired Help-Desk - Visually impaired consumers can raise call back or Braille bill request through BRPL Power App & Call Center (19123)

• Online end-to-end new connection services and prepaid meter balance check and recharge service through WhatsApp under e-services category

• CRM solution to enhance operational efficiency of Call Center & Consumer Help Desks

• Intra-DSK (Digi Seva Kendra) operations started for better customer service.

• Facility of "Know your meter reading schedule" service through Power App & Website to check next meter reading schedule / date

• Complaint about "Report Power Theft" service through Power App & Website

• Facility of payment receipt link included in instant payment acknowledgement SMS

• Enhancement in Online new connection process to improve overall user experience & reduce application rejection rate

C. Roads Projects

Our Roads Business portfolio comprises of 8 BOT (Built, Operate and Transfer) Toll Road projects with a total stretch of 620.75 kilometers (Km). All road projects are revenue operational, which are majorly urban centric roads in high traffic density corridors spread across four states in India.

There are 15 toll plazas operating in these 8 toll roads with an average daily traffic of 2.97 lakh vehicles and an average toll collection of Rs 3.02 crore per day. The details of the various toll projects are summarized as under:

a. NK Toll Road Limited

NK Toll Road is engaged in widening of 2-lane to 4-lane portion of Namakkal Bypass to Karur Bypass covering 14.4 Km on the NH 7 in Tamil Nadu as well as improvement, operation and maintenance of the flyover on Namakkal Bypass on a BOT basis. The project commenced commercial operations in August 2009. This project became debt-free in the FY 2021-22.

b. DS Toll Road Limited

The project stretch of 53 Km long 4-lane dual carriageway of 15 stretches on BOT and annuity basis, which included, inter alia, the package for design, construction, development, finance, operation and maintenance between the Dindigul bypass to Samayanallore on NH-7 in Tamil Nadu, is in operation since September 2009.

c. TD Toll Road Private Limited

The project stretch of 87 Km long 4 lane NH 45 road is in operation since January 2012 and provides connectivity to Trichy and Dindigul in Tamil Nadu. This SPV is under Corporate Insolvency Resolution Process.

d. TK Toll Road Private Limited

TK Toll Road Project was for strengthening and maintenance of the existing carriageway on the Trichy - Karur section of the NH67 covering 64 Km in Tamil Nadu, on a BOT basis. The project commenced commercial operations in February 2014.

e. SU Toll Road Private Limited

SU Toll Road project was envisaged to strengthen and maintain the existed carriageway for a stretch of 136 Km on the Salem - Ulundurpet section of NH 68 in the State of Tamil Nadu and widen the roads from two to four lanes, on a BOT basis. The project commenced commercial operations in July 201 2 and 3rd toll plaza was put in operation in September 2013.

f. GF Toll Road Private Limited

GF Toll Road project was for upgradation of 4 sections of the existing road on the Gurgaon Faridabad road covering a total stretch of 66 Km. This road contains four toll plazas and is operational since June 2012.

g. HK Toll Road Private Limited

HK Toll Road project was envisaged for strengthening and widening of the 60 Km stretch between Hosur and Krishnagiri on NH-7 from existing 4-lane to 6-lane as design, build, finance, operate and transfer (DBFOT) pattern in Tamil Nadu. This project is operational since June 2011.

h. PS Toll Road Private Limited

PS Toll Road project was envisaged to expand the Pune-Satara section of the NH-4, on a DBFOT basis, which in turn forms part of the Golden Quadrilateral, in Maharashtra. The project was set up with an objective to design, build and operate 140.35 Km long 6 lane between Pune and Satara in Maharashtra. Tolling on the project started in October 201 0. The provisional completion certificate was obtained at the end of April 2022.

D. Mumbai Metro One Private Limited

The Mumbai Metro Line-1 project of the Versova- Andheri-Ghatkopar corridor was awarded by the Mumbai Metropolitan Region Development Authority (MMRDA) through a global competitive bidding process on Public- Private Partnership (PPP) framework to the consortium led by the company for 35 years, including construction period. Due to its complex challenges during construction stage Mumbai Metro Line-1 has become one of the prestigious infrastructure projects to have taken shape in Mumbai.

Mumbai Metro One Private Limited (MMOPL) is in its 9th year of commercial operations and continues to provide world-class public infrastructure to the city of Mumbai and has served more than 800 million happy commuters since inception. Before the pandemic, the average ridership on weekdays was around 4.50 lakh per day, making it the busiest metro line in India and the 7th densest metro line in the world. After the easing of Covid-19 Pandemic induced restrictions the ridership has been constantly improving and reached close to pre-pandemic levels of about 4 lakh commuters on weekdays. Moreover, opening of two new

Metro lines, Line 2A: Dahisar (East) to D.N. Nagar and Line 7: Dahisar (East) to Andheri (East) at Western Express Highway Station, in January 2023 have further accelerated the ridership of Mumbai Metro Line-1. These two lines alongwith other upcoming lines in Mumbai will strengthen the infrastructure and overall growth.

MMOPL has continued to achieve excellence in the field of public transport operation. It has been achieving 100% train availability and over 99% on-time performance since its inception. The Rolling Stock and Civil maintenance processes of Mumbai Metro One are certified as ISO 9001. The trains are being operated from 05.30 AM to 11.45 PM with the highest frequency of 3.40 minutes in peak hours.

New Initiatives

Mumbai Metro Line-1 has launched in February 2023, the National Common Mobility Card (NCMC) which is an inter-operable transport card that enables the user to pay for travel, toll duties (toll tax), retail shopping and withdraw money. Earlier in April 2022, it had launched an e-Ticket via Whatsapp, the first ever in MRTS. MMOPL aims to achieve higher levels of efficiency, customer satisfaction and lower human intervention. E-Ticketing also helps MMOPL in its quest to be more environment friendly.

Mumbai Metro One strives to increase the non-fare revenue through significant initiatives such as Station Branding Rights (SBR), telecom infrastructure development, retail area development, train wraps, payment alliances etc. The advertising revenue has steadily shown an upward trend since resumption of services, after Covid-19 Pandemic. The leasing business has also seen an upward trend in the recent past.

MMOPL has been actively undertaking green initiatives like power generation through roof top solar panels, rain-water harvesting systems and use of recycled water for cleaning of trains, amongst other similar initiatives. MMOPL encourages eco-friendly mode of transportation and as an extension to this initiative, it has successfully extended the MyByk (a public bike-sharing service) from Versova & 6 more metro stations from January 2021 with support from MMRDA, WRI & Toyota Mobility Foundation.

E. Defence Business

Aligning with the government initiatives under "Manufacture in India" and "Atmanirbhar Bharat Abhiyan" the Companys Defence Business attempts to tap the enormous opportunities in the Defence Sector and aims at building capabilities and Indigenous development for Defence and Aerospace Industry.

The Companys defence business has two operational Joint Ventures, one of the largest Defence & Aerospace Park in Private Sector at MIHAN - SEZ and SPVs that together hold 12 Industrial licenses issued by the Department of Industrial Policy & Promotion (DIPP), Ministry of Commerce.

In the Defence and Aerospace domain, Reliance Defence Limited (RDL) has taken multiple initiatives to meet the needs of both military and civil aviation. The Dhirubhai Ambani Aerospace & Defence Park (DAAP) is one such initiative, located at the SEZ at MIHAN (Multi Modal

International Hub at Nagpur). The long term vision is to create a comprehensive Aerospace & Defence manufacturing hub, with capability to address the domestic as well as export Civil and Military markets.

Reliance Infra has an operational Joint Venture (JV) Company with Dassault Aviation of France - Dassault Reliance Aerospace Limited (DRAL) for its Aerospace programs. DRAL, in operations for five years now, has strength of more than 150 people and has successfully delivered large number of aero structures of Falcon-2000 business jets and components of Rafale fighter jets. DRAL is in process of adding more than 3,00,000 Sq Ft to its existing facility spread over 1,50,000 Sq Ft to expand its business with a target of final assembly, integration and delivery of Falcon 2000 business jet from MIHAN facility. The first made in India Falcon-2000 aircraft is expected to fly out of Nagpur in 2025.

Thales Reliance Defence Systems Limited (TRDS) is the second JV Company of Reliance in Aerospace & Defence domain, incorporated in partnership with Thales of France. TRDSs scope of work includes Assembly, Integration and Testing (AIT) of Airborne AESA Radars and Electronic Warfare Suite of Rafale fighter jets, Performance Based Logistics (PBL) support and undertaking Level 1 and 2 repairs to the Rafale aircraft fleet of the Indian Air Force (IAF). TRDS is also involved in Indigenization of various electronic assemblies / sub assemblies and integrating multiple Indian companies into Thaless global supply chain. As part of this initiative, TRDS has collaborated with various companies including BEL to manufacture Trans Receiver Modules (TR Modules) and Micro Modules which would be subsequently used for undertaking Active Electronically Scanned Array (AESA) airborne radar Integration. This will be the first time an Indian company will undertake AESA airborne radar Antennae integration. TRDS has already carried out successful AIT of airborne radars and EW suites of Rafale and has exported the same to Thales in France. TRDS is also participating in the upgrade / modification programs of various aircrafts of the IAF.

TRDS is also engaged in establishing its manufacturing line for manufacture of Navigational Aids used for commercial and defence applications. In this regard, TRDS has already commenced manufacturing Differential VHF Omin Directional Receivers (DVOR) Systems. Establishing of manufacturing capabilities of Instrument Landing System (ILS), Distance Measuring Equipment (DME) and Non Surveillance Radar System (NRS) are also planned to be completed in FY24. As part of its CSR initiative, TRDS continues to contribute towards the Prime Ministers Relief Fund for the second year in a row.

F. Airport Business

The Company through its subsidiaries was awarded lease rights to develop and operate five brown field airports in the State of Maharashtra at Nanded, Latur, Baramati, Yavatmal and Osmanabad in November 2009 by the Maharashtra Industrial Development Corporation (MIDC) for 95 years.

In FY 2022-23, the 5 airports had around 1,740 Aircraft Movements. Nanded Airport is actively pursuing schedule airlines to start schedule air services at Shri Guru Gobind Singh Ji Airport, Nanded. Aerodrome License of Nanded Airport was renewed by DGCA for 2 years in April 2022.

The Baramati Airport handled 448 air traffic movements during the year while Latur Airport managed 1,152 air traffic movements. A spike in air traffic movement was observed during the year due to increase in Cross Country Training Flights.

G. Reliance Power Limited

The Company is a promoter of Reliance Power Limited (Reliance Power), a Company listed on BSE and NSE. During the year, the Company was allotted ~33.51 crore equity shares of Rs 1 0 each of Reliance Power upon conversion of warrants issued under Preferential allotment.

Reliance Power has one of Indias largest portfolios of private power generation and resources under development. The portfolio of Reliance Power comprises of multiple sources of power generation-coal, gas, hydro, wind and solar energy. Reliance Power also operates a 20 mtpa capacity coal mine in Singrauli, Madhya Pradesh and is developing coal mines in Indonesia. Reliance Power currently has an operational capacity of 5,945 MW comprising of 5,760 MW of thermal capacity and 185 MW of capacity in renewable energy. Thermal capacity of 5760 MW operated at PLF of 74% during FY 202223, exceeding the national average PLF of 64%. The operational thermal capacities include the 3,960 MW Sasan Ultra Mega Power Projects (UMPP) in Madhya Pradesh - the largest integrated power plant and coal mining project in the world. Coal for the project is being mined from the Moher and Moher-Amlohri captive mines. Sasan UMPP operated at Plant Load Factor (PLF) of 86% in its eight year of full operations. Coal production from Moher and Moher - Amlohri captive mines in FY 2022- 23 was 16.6 million tonnes. Reliance Power also owns and operates the 1,200 MW Rosa power plant in Uttar Pradesh and the 600 MW Butibori power plant in Maharashtra. In the renewable energy space, Reliance Power operates a 40 MW photovoltaic solar plant and 100 MW thermal solar plant in Rajasthan and a 45 MW wind farm in Maharashtra. Renewable portfolio of 185 MW operated at availability of 85% during FY 2022-23.

Human Resources

In a business environment and marketplace that is continuously changing, the major competitive advantage for a leading organization hinges upon knowledge, skills, and experience of its employees. At Reliance Infra, Human Resource (HR) drives organizational performance by harnessing unique capabilities of developing robust systems, processes and an engaging work environment, fostering critical skill development, improving employee experience and enhancing employee engagement. As a strategic enabler and business partner, HR strongly focuses on organizational development and employee engagement to accelerate businesses growth. Innovation, alignment of HR practices with business needs, total commitment to the highest standards of corporate governance, business ethics and social responsibility has lead our organization to create a work environment that nurtures empowerment, meritocracy, transparency and ownership. As on March 31, 2023, the Reliance Infrastructure Group had offered employment to ~35,000 people (Directly / indirectly)

The Companys strong foundation of policies and processes ensures health, safety and welfare of its employees. Rigorous practical training on safety and extensive safety measures like job safety assessment and safe construction techniques at project sites have been undertaken by the Company for its employees. Throughout the year, the Company has organized several medical camps and cultural activities for employees and their families. The Company has established harmonious industrial relations, proactive and inclusive practices with all employee bodies.

Risks and Concerns

Companys revenues are derived from the domestic market. Over the years, the Company has made significant investments in various infrastructure sectors like Power Distribution, Power Generation, Mumbai Metro, Roads and also in Defence. These sectors may potentially expose the Company to the risk of any adverse impact to the national economy and any adverse changes in the policies and regulations. The Company closely monitors the Governments policy measures to identify and mitigate any possible business risks.

In the Roads business, all projects are revenue operational. Potential risks to these projects include reduction in traffic due to economic slowdown and / or any unforeseen events. However, agreements are entered with the concerned authorities do provide for compensation in case of certain events arising out of government action or regulation.

In the E&C business, most of the projects are nearing completion or are already completed. The Company has to expand the E&C contracts by bidding for projects across power, transport infrastructure, civil infrastructure, defence, etc.

In the power distribution business, the consumer tariffs are regulated by respective State Electricity Regulatory Commissions. Any adverse changes in the tariff structure could have an impact on the Company. However, the Company endeavours to achieve the highest efficiency in its operations and has been implementing cost reduction measures in order to enhance its competitiveness.

There is also a risk of rising competition in the supply of electricity in the licensed area of the Company. The Company has built a large infrastructure and established a distribution network that is difficult to replicate by potential competitors and shall endeavor to provide reliable, quality and safe power at competitive costs, with the highest standards of customer care to meet the threat of competition.

In defence business, the Company through its Special Purpose Vehicle (SPV) has received licences for production of defence equipment under the aegis of Make in India initiative of the Government. The Company faces significant concentration risks as the Government of India is the sole customer for most of the defence equipments initially. Managing the supply chain, competition in domestic and international market, capacity to innovate and compliance with a wide range of regulations and restrictions are some of the challenges faced in the defence sector. The Company has recruited experienced professionals for implementing the projects within the framework of the policies and regulations being formulated by the Government for private sector participation in the defence industry.

Infrastructure projects are highly capital intensive, run the risks of (i) longer development period than planned due to delay in statutory clearances, supply and sourcing of equipments or non-availability of land, non-availability of skilled manpower, etc., (ii) financial and infrastructural bottlenecks, (iii) execution delay and performance risk resulting in cost escalations. The past experience of the Company in implementing projects without significant time overruns provides confidence about the timely completion of these projects.

On the finance side, any adverse movement in the value of the domestic currency may increase the Companys liability on account of its foreign currency denominated borrowings in rupee terms. The Company undertakes liability management on an ongoing basis to manage its foreign exchange rate risks.

Risk Management Framework and Internal Control Systems

The Company has a defined Risk Management policy applicable to all businesses of the company. This helps in identifying, assessing and mitigating the risk that could impact the Companys performance and achievement of its business objectives. The risks are reviewed on an ongoing basis by respective business heads and functional heads across the organization.

Company has Risk Management Committee consisting of Independent Directors and senior managerial personnel. On a quarterly basis, the Risk Management Committee independently reviews all identified major risks & new risks, if any, and assess the status of mitigation measures/plan.

The internal financial controls for all the significant processes have been identified based on the risk evaluation in the business process and same have been embedded/ implemented in the business processes. These processes and controls have been documented. Professional internal audit firms review the systems and processes of the Company and provide independent and professional opinion on the internal control systems. The Audit Committee of the Board reviews the internal audit reports, adequacy of internal controls and risk management framework periodically. These systems provide reasonable assurance that our internal financial controls are designed effectively and are operating as intended.

Key Awards and Achievements

Reliance Infras performance has been recongnised and appreciated through various awards received by its businesses.

Delhi Discoms have been recognized at various national and international forums and won prestigious awards for their exemplary performance and best practices in distribution business, corporate governance, green initiatives, HR initiatives, CSR programs and safety practices. REC has recognized BRPL and BYPL as Number one is customer service survey. BYPL and BRPL are the only discom Companies in the category.

Further, BRPL has won the following awards:

• Certificate of Appreciation for Outstanding Contribution for Diversity & Inclusion category and Outstanding Contribution for Best Employer Women category (Assocham).

• Excellence Award in Energy Management (CII)

• Employee Wellbeing Award (National Ability Award)

• Green Energy Initiatives Award, Overall Innovation with Impact Award (General States), Innovative and Jury Choice Award and Technology adoption Award (ICC)

• Best Green Procurement Initiatives Award and Best Consumer Proposition of the Year Award (EV Charge India Awards 2021).

• Jury Special mentioned award (Frost & Sullivan and TERI Sustainability 4.0 Awards 2021)

• Gold Award for "Employees Retention Strategy Award 2020" (Apex India Foundation)

BYPL was honored with the following awards:

• Safety Award 2021 (Greentech Foundation)

• Innovation Awards 2022 (India Smart Grid Forum - ISGF)

• Effective Safety Culture Award 2021 (Greentech

Foundation)

• Innovation with Impact Award 2021 (Indian Chamber of Commerce - ICC)

• Golden Peacock Award for Energy Efficiency 2021 (Institute of Directors)

• National Energy Award for Excellence in Energy Management 2021 (CII)

• National Award for Excellence in Training & Development (World HRD Congress)

MMOPL was honored with the following awards:

• Golden Peacock National Training Award for the year 2022, by Institute of Directors India.

• Excellence in Commuter Friendly Technology Innovation" in Urban India Business Summit.

• iNFHRA Award - Workplace Excellence Award in "Safety and Security" category.

Corporate Social Responsibility (CSR)

As part of the CSR mandate, Reliance Group focuses on its endeavour to bring about a tangible change in the Society around and through its various CSR initiatives, aims at achieving the equitable development at its project locations. The CSR interventions of the group focuses on key Thematic areas covering Education, Healthcare and Rural Transformation that includes development of infrastructure facilities, skill building and promotion of sustainable livelihood, improving the socioeconomic status of women and the youth and Environment and sanitation under Swachh Bharat Abhiyan.

A few of the significant CSR interventions and initiatives were as under:

Rural Transformation and Women Empowerment

• Financial Literacy and Self Help Groups (SHGs) - For promoting financial literacy among the under privileged, BRPL, through its CSR programs, is spreading awareness about financial concepts, personal finance, and money management. Bank accounts are being opened for beneficiaries who do not have accounts and are willing to be part of the formal banking system. A total of 6,000 women benefitted in FY 22-23.

• The SHGs are envisaged as an instrument to bring social and economic empowerment to women, particularly those belonging to the impoverished sections of society. The project aims to strengthen the skill capabilities of five SHGs (around 100 women) in West Delhi for making women socially and economically empowered.

• Sanitary Napkins & Masks - Due to the large proportion of unemployed urban poor women in the community, the group, through its Discoms, chose the production of sanitary napkins to enhance their economic as well as social status. Establishing entrepreneurship among women, over 400,000 sanitary napkins and 33,500 masks were stitched and distributed.

• BRPL has been promoting menstrual hygiene practices among women from the weaker sections of society by providing them with accessible, affordable, and safe sanitary pads through its Self Help Groups. Eleven sanitary vending machines cum incinerators have been installed at the Government Hospital and Nursing Home, this year.

• Vocational Training Centres and Digital Library - Through their vocational training (VT) centers, job-oriented courses on Computers, Beauty Culture, and Tailoring are being provided. More than 1,800 students have enrolled in the BRPL VT centers, and a job fair/Rozgar Mela was also organized in Dwarka in West Delhi.

• A digital library is operating in Jamina Nagar Police Station for underprivileged students by the Shikar Organization supported by BRPL, and more than 62,000 students have benefited so far.

• Self Defense Training for Girls - With the aim to protect girls and women, BRPL organized a self-defense training program in five schools in West Delhi and around 240 girls participated.

• Tobacco de addiction campaign - This Campaign is being carried out by the Discoms with a great amount of success. Around 280 people participated and 225 pledged to quit their habit. BYPL partnered with Society for Advancement of Village Economy to successfully conduct two tobacco de-addiction camps in Janta Colony (Yamuna Vihar division) benefiting 173 men and women.

Healthcare Initiatives:

• School Health Clinic - The Group, through its Discoms partnered with the Governments ambitious School Health Clinic (SCH) project in South and West Delhi, initially covering 20 Delhi Government schools and benefiting more than 20,000 students and staff. Health is not merely the absence of disease or infirmity but a state of complete physical, mental, and social well-being. Holistic healthcare for children, one of the most vulnerable sections of our society, needs equal focus on physical as well as mental health. These SHCs are taking care of the overall well-being of students.

• Support to Government hospitals: In FY 22-23, medical equipments were provided to three Government hospitals. Electromyography machine was handed over to Institute of Human Behaviour and Allied Sciences (IHBAS). A high-end 4D Echo Cardiography Scanning machine was donated to the Govind Ballabh Pant Institute of Postgraduate Medical Education and Research (GIPMER). Chacha Nehru Bal Chikitsalaya (CNBC) was provided with 50 desktop computers.

• Supporting Differently-abled person: In FY 22-23, four programs were organized through implementing partner Artificial Limbs Manufacturing Corporation of India (ALIMCO) to distribute appliances and assistive aid to people with disability. Distribution programs were held at ALIMCO Head Office, Anukriti Special School, Govt. Primary School for the Deaf and School for Mentally Retarded Children where the Companys team distributed aids and appliances to 164 people with disability.

• Pradhan Mantri TB Mukt Abhiyaan at Jag Pravesh Chandra Hospital: BYPL, as a Ni-Kshay Mitra provided nutritional

support assistance to 100 registered TB patients of Jag Pravesh Chandra Hospital in Shastri Park for six months through NGO Society for Advancement of Village Economy.

• Physical Fitness and Yoga - BRPL provides football training, including diet and related support to the underprivileged youth from rural/semi-urban areas. Three players under this programme were selected for the Indian Archery team under 18, and they also took part in Hero Women Indian League held in Odisha. One of them was a member of the Indian Football Team for Asia Cup 22.

• Yoga camps were organized at regular intervals for physical and mental well being of police personnel and teaching and non-teaching staff at government schools. . Celebration of International Yoga Day was also organized on June 21, 2022.

• Eye Care and Blood Donation camps - Multiple eye screening camps were organized in Delhi in association with I-Care hospital. At these camps free eye consultations including screening for cataract, reading glasses and eye medicines were provided. Eye check up camp was organized at Hosur-Krishnagiri project in association with Agarwal Eye Hospital, Krishnagiri in the month of May 22. Health check-up camps with a major focus on eye screening were organized at schools in the nearby villages and at some of the toll plazas.

• BRPL organized a blood donation camp in association with the Indian Red Cross Society, and 50 people donated their blood for this noble cause.

• Other Health & Safety Programs:

> Organized health check up of Toll collectors and Maintenance Labors in Gurgaon- Faridabad Main toll plaza.

> Health checkup done by Government Primary Health Centre, Ammyanayakkanur to the Road Users, General Public & Toll Staffs in Dindigul- Samaynallur project.

> General Body Checkup was conducted by Government Primary Health Centre, Ammyanayakkanur to the Road Users, General Public & Toll Staffs.

> Organised Free Health Check Camp at Salem- Ulunderpet project (Mettupatti Toll Plaza).

> Road Safety Awareness program was organized at Gurgaon Faridabad Toll Plaza and in Hosur Krishnagiri project.

> Safety Awareness & Certificate distribution was organised under the PMs flagship program "Azadi Ka Amrut Mahotsav" campaign.

> In Namakkal Karur project, Safety training for truck drivers, Road Safety, First aid & Driving Techniques was organized.

• Distribution of assistive aid and appliances to People with Disability - In Delhi, assistive aids and appliances were distributed to around 50 people with disabilities. Wheelchairs, tricycles (motorized and manual), and artificial limbs were provided to the Divyangjans. The visually impaired were handed-over smartphones with

special software as part of the discoms Sparsh initiative. Children from the National Association for the Blind (NAB) were helped by providing them with necessary facilities, including Braille and Audio Books to aid in their education.

Education related initiatives:

• SASHAKT Scholarship 2022-23 - This year, 3363 students registered for the 3rd BYPL Sashakt Scholarship programme implemented by Buddy4study India Foundation. From these registered candidates, 187 final year graduation students from colleges in Delhi (like DTU, Gargi, Hindu, Hansraj, Miranda, SRCC etc.) received the BYPL SASHAKT scholarship in 2022-23.

• Effective Education for Students - Mini Science Centres: The Group, through Delhi discoms, has partnered with NGO AROH Foundation and STEM Learning Pvt. Ltd. to set up Mini Science Centres to encourage students to better understand STEM (Science, Technology, Engineering and Maths) concepts at 15 Government Schools in Delhi. These Mini Science Centres have 80 plug and play models - teaching aids for school children to better grasp concepts of physics, biology, mathematics and engineering.

• Support to Public Libraries - Books and equipments were provided to Dyal Singh Public Library, Shaheed Ratanlal Library at Nand Nagri police station and Umeed Delhi Police Public Libraries at Karawal Nagar and Jyoti Nagar which are run for the public and the youth in particular.

• Tihar Jail Rehabilitation Project - Through association with NGO Sofia Educational and Welfare Society, various interventions were introduced like vocational training facilities and providing tutors for inmates of Central Jail 11 & 16 of Tihar Jail at Mandoli.

• Facilities to School - One of the Toll Companies is supporting Government Higher Secondary School, Mettupatty Located in Tamil Nadu. With a strength of about 1200 Students from nearby villages from economically backward background by providing Smart class room with Computer, Smart Board, Projector with audio system and necessary equipment along with Furniture (Steel Table and Benches) for Students including the required painting work/ minor civil repair works for the Smart class building. CSR activity was also carried out at Primary Government School at Nunehera Village Gurugram in November 2022.

Other CSR Interventions:

• Tree Plantation and Energy Conservation - BRPLs CSR programs continued to build on the annual tree-plantation drive that started in July. Around 30,000 plants were planted in Delhi Police premises, Delhi Government and MCD Schools, Community centers, and crematoriums. This is also part of Delhi Governments Annual Green Initiative Drive.

• Five consumer awareness programs on energy conservation and power theft were organized in South Delhi.

• Water ATMs and Water Coolers - With the aim to provide safe drinking water to residents in Delhi, especially the underprivileged section of society, two water ATMs have been installed, one each in South & West Delhi. BRPL also installed six water coolers in MCD schools with the aim

to provide safe & cool drinking water to the MCD school students and staff.

• Surakshit Sadkein Sampann Dilli - Road safety project - The Delhi discoms CSR team is lending support to this pilot project to encourage safe road use practices and reduce fatalities at a high fatality traffic junction, the Signature Bridge in Delhi. The implementing partner Save LIFE Foundation submitted tactical redesign project report and conducted a communication campaign to raise public awareness on road safety and encourage behavioural change. This project was completed in FY 22-23.

• Green Crematorium - BRPL has set up an Electric Furnace at MCD Sarai Kale Khan Crematorium in South Delhi with an aim to promote eco-friendly cremation process. It has also provided facilities like Benches, Chairs, Exhaust Fans, Fans, Water Tanks, Dustbins, etc. in the crematoriums located in West Delhi.

• Awareness programs on the safe disposal of sanitary waste and hygiene were organized at various locations in South and West Delhi, benefiting around 3,200 people under this project. Focus was largely on reducing waterborne diseases, sensitization, and improving sanitation at home and surrounding areas and also on limiting the school dropout rate among girl students and sensitizing them about hygiene in slums of Delhi Cantonment area.

• Swachh Bharat Abhiyan - Cleanliness drives were conducted around the company plant and offices and the neighbouring localities with an objective to create a clean and healthy workplace. The roads business toll plazas and project highway inculcated the concept of cleanliness and hygiene by putting Placards and Signages in Public areas for not spitting, littering, placements of dustbins, maintenance of toilets and way side amenities / user facility to encourage commuters to use them and not to spoil the Highway or Toll Plaza area. Swachh Bharat Abhiyan was organised at Crusher Zone Toll Plaza of Gurgaon-Faridabad Road on October 2022.

• Green Highways - The Union Ministry of Road Transport and Highways has framed the Green Highways (Plantation, Transplantation, Beautification and Maintenance) Policy-2015 with a vision to develop eco-friendly National Highways with participation of concerned stakeholders. Under this Policy, we have undertaken plantation and landscaping work activities in operational projects. For the projects under development, the avenue plantation and median plantation are being done as per the direction of NHAI. Reliance Infra road business has covered approximately 630 Km of area under avenue plantation and approximately 500 Km under tree plantation in the median plantation and the same is maintained regularly. Close to 23,920 trees have been planted in Salem Ulundurpet project and 8,500 trees in Hosur Krishnagiri project.

Har Ghar Tiranga: The Group celebrated Azadi ka Amrit Mahotsav by distributing flags to residents of East and Central Delhi.

Others - Mumbai Metro Line-1 continues to engage in CSR activities, wherever possible, in association with organizations like ADAPT (formerly known as the Spastics Society), etc.

Industry Structure and Development, Opportunities and

Threats

• Mumbai Metro business

> Despite the other alternate means of transport, Mumbai Metro is largest and efficient means for local transport after Mumbai suburban railway in Mumbai. It has future growth opportunities with various other metro lines operational & to start operations in near future (Line 2, 3, 4, 6). This would provide cross feeding of ridership and increase ridership for Mumbai Metro business.

> Metro business, to improve last mile connectivity, has tied up with Bus infrastructure and also done harmonization / synchronization of Metro time table of other travel modes.

> In addition to last mile connectivity, Mumbai Metro business to develop further has taken various initiatives like - usage of bicycle to improve the connectivity of metro to consumers

• Roads Infrastructure business

> Currently India is in high growth phase and will experience increase in vehicular traffic. Vehicle sales registered a 21% growth in FY23.

Category Units sold (FY23) Units sold (FY22) Growth (in%)
Two-Wheeler 1,59,95,968 1,34,94,214 19
Three-wheeler 7,67,071 4,17,108 84
Passenger vehicles 36,20,039 29,42,273 23
Commercial vehicles 9,39,741 7,07,185 33
Tractor 8,27,403 7,66,545 8

> This would result in an incremental impact on Passenger traffic - Cars and Buses along with increase in Commercial traffic - trucks, cargo trailers etc.

> Above growth in vehicles would result in increase in traffic which has resulted the central government intentions to accelerate the construction of roads in FY24 by 16-21% to 1 2,000-12,500 km, with a healthy pipeline of projects and an increase in capital expenditure

> With current growth in vehicles and increase in traffic, there is construction of parallel road infrastructure. Thus, though Road business faces threats of parallels roads being constructed across current existing roads infrastructure and same would not impact RInfras roads business with current growth in India Economy and Vehicular growth and increase in traffic.

> To provide seamless and faster travel experience on FASTag system has been a great boon for travelers since it has reduced queuing problems at toll plazas. With FASTag, wastage of time has reduced for travelers as there is no stoppage at toll plaza for payment of toll. Further National Highway Authority of India (NHAI) has been trying to implement toll collection through Global Positioning System

(GPS) based FASTag reading which will remove toll plaza completely resulting in lower operations and maintenance cost for Roads business.

• Power Distribution business

> The Electricity (Amendment) Bill, 2022 that has being drafted and pending for approval by Parliament is to proposed to bring remarkable change in the industry sector. The following are the Key Highlights of the Bill

? The Electricity Act, 2003 permits more than one distribution licensee (discom) to operate in the same area. They are required to supply electricity through their own network. The Bill removes this requirement and now a network-owning discom will be required to provide open and non-discriminatory access to its network to other discoms.

? The power and associated costs from existing power purchase agreements (PPAs) will be shared among all discoms in an area.

? The State Commission will determine the floor and ceiling tariffs for retail supply, if there is more than one discom in an area.

? The state government will set up a Crosssubsidy Balancing Fund to deposit surplus of cross-subsidy with one discom, and to provide for any deficit with another discom in the same or any other area.

? The Bill provides for a payment security mechanism to ensure timely payment to generation companies.

> This provides an opportunity for RInfra to exploit new markets for power distribution across India with its current experience in Power Distribution business. However, the same also poses a threat of competition from the new entrants to RInfras existing Power Distribution business.

• Engineering and Construction (E&C) business

> India has to enhance its infrastructure to reach its 2025 economic growth target of US$ 5 trillion. Indias population growth and economic development requires improved transport infrastructure which would be achieved through investments in roads, railways, and aviation, shipping and inland waterways.

> E&C business of the Company has high growth potential in line with the growth in the Indian Economy. Following budgetary allocation by Government of India for various sectors viz., Capital, Construction and Roads sector opens huge opportunity for the Companys E&C business.

? Under the Union Budget 2023-24, the Government of India has allocated Rs 2.7 lakh crore (US$ 33 billion) to the Ministry of Road Transport and Highways.

? The Government of India has allocated Rs 111 lakh crore (US$ 13.14 billion) under the National Infrastructure Pipeline for FY 2019-25. The Roads sector is expected to account for (~ Rs 20 lakh crore) 18% capital expenditure over FY 2019-25.

> Further, in Budget 2023-24, capital investment outlay for infrastructure is being increased by 33% to Rs 10 lakh crore (US$ 122 billion), which would be 3.3% of GDP.

• Defence business

> Demand growth is likely to accelerate with rising concerns of national security. Defence exports grew by 334% in last five years; India now exporting to over 75 countries due to collaborative efforts.

> India has the worlds third-la rgest defence expenditure, as of 2021, and expects to export equipment worth US$ 15 billion by 2026. The Government of India opened the defence industry for private sector participation to provide impetus to indigenous manufacturing.

> The Union Budget for Financial Year 2023-24 envisages an outlay of US$ 72.2 billion (~ Rs 5.9 lakh crore), which is 13.18 % of the total budget.

> Over the next 5-7 years, the Government of India plans to spend US$ 130 billion for fleet modernisation across all armed services.

> The Indian defence sector is one of the worlds largest and most profitable industries, with a 10- year pipeline of over US$ 223 billion in aerospace and defence capital expenditure and a projected medium-term investment of US$ 130 billion.

> The present Defence Production & Export Promotion Policy (DPEPP) 2020 is positioned as Ministry of Defences overarching guiding document to provide a focused, structured and significant thrust to defence production capabilities of the country for self-reliance and exports.

> The DPEPP has goal - to achieve a turnover of Rs 1.75 lakh crore (US$ 25 billion) including export of Rs 35,000 Crore (US$ 5 billion) in Aerospace and Defence goods and services by 2025.

> Above initiatives and promotion by Government of India will result India to be export hub for Aerospace - Aviation, Defence goods (Arms and ammunition) and services sector

• Airport business

> India has become the third-largest domestic aviation market in the world and is expected to overtake the UK to become the third-largest air passenger market by 2024.

> By 2036, India is projected to have 480 million flyers which would be more than Japan (just under 225 million) and Germany (just over 200 million) combined.

> India is expected as the top aviation market globally by 2030, surpassing the United States and China.

> By 2023, total Indias freight traffic is expected to touch 4.1 MT, exhibiting a Compound Annual Growth Rate (CAGR) of 7.27% between FY16 and FY23. In addition, international freight traffic is expected to grow at a CAGR of 7.13% and domestic freight traffic is expected to grow at a CAGR 7.50% between FY16 and FY23.

> The Companys Airport business with current operations at five locations in Maharashtra has potential for development into Cargo hubs for moving the local products viz, Agriculture and local perishable goods which will lead to growth in the Airport business, in ancillary industry, in transportation system with better road infrastructure and connectivity.

Outlook

The Indian economy has risen from being 10th to the 5th largest economy globally. The per capita income has doubled and increased to 1.97 lakh in 9 years. Indian economy is expected to grow by 5.9% in FY 2023-24 and by an average rate of 6.1% over the next five years. The economy has been on a recovery path after the impact of the pandamic.

In the Financial year 2023-24, India has budgeted the capital investment outlay for infrastructure sector to 10 lakh crore (US$ 122 billion), which would be 3.3% of GDP and almost three times the outlay in 201 9-20. Infrastructure Finance Secretariat is being established to enhance opportunities for private investment in infrastructure that will assist all stakeholders for more private investment in infrastructure, including railways, roads, urban infrastructure, and power.

This depicts the upward trajectory of the Indian infrastructure space which is on the rise. Also, India has to enhance its infrastructure to reach its 2025 economic growth target of US$ 5 trillion. The economy boost is only possible with the infra development at the forefront.