Reliance Industries Ltd

BSE: 500325 | NSE: RELIANCE | ISIN: INE002A01018 
Market Cap: [Rs.Cr.] 3,17,140.55 | Face Value: [Rs.] 10
Industry: Refineries

Auditor's Report
Letter to Shareholders

A. PRINCIPLES OF CONSOLIDATION

The consolidated financial statements relate to Reliance Industries Limited (‘theCompany’) and its subsidiary companies, associates and joint ventures. Theconsolidated financial statements have been prepared on the following basis:

a) The financial statements of the Company and its subsidiary companies are combined ona line-by-line basis by adding together the book values of like items of assets,liabilities, income and expenses, after fully eliminating intra-group balances andintra-group transactions in accordance with Accounting Standard (AS) 21 -"Consolidated Financial Statements"

b) Interest in Joint Ventures have been accounted by using the proportionateconsolidation method as per Accounting Standard (AS) 27 - "Financial Reporting ofInterest in Joint Ventures".

c) In case of foreign subsidiaries, being non-integral foreign operations, revenueitems are consolidated at the average rate prevailing during the year. All assets andliabilities are converted at rates prevailing at the end of the year. Any exchangedifference arising on consolidation is recognised in the exchange fluctuation reserve.

d) The difference between the cost of investment in the subsidiaries, over the netassets at the time of acquisition of shares in the subsidiaries is recognised in thefinancial statements as Goodwill or Capital Reserve, as the case may be.

e) The difference between the proceeds from disposal of investment in subsidiaries andthe carrying amount of its assets less liabilities as of the date of disposal isrecognised in the consolidated Statement of Profit and Loss being the profit or loss ondisposal of investment in subsidiary.

f) Minority Interest’s share of net profit of consolidated subsidiaries for theyear is identified and adjusted against the income of the group in order to arrive at thenet income attributable to shareholders of the Company.

g) Minority Interest’s share of net assets of consolidated subsidiaries isidentified and presented in the consolidated balance sheet separate from liabilities andthe equity of the Company’s shareholders.

h) Investment in Associate Companies has been accounted under the equity method as perAccounting Standard (AS) 23 - "Accounting for Investments in Associates inConsolidated Financial Statements".

i) The Company accounts for its share in change in net assets of the associates, postacquisition, after eliminating unrealised profits and losses resulting from transactionsbetween the Company and its associates to the extent of its share, through its Statementof Profit and Loss to the extent such change is attributable to the associates’Profit or Loss through its reserves for the balance, based on available information.

j) The difference between the cost of investment in the associates and the share of netassets at the time of acquisition of shares in the associates is identified in thefinancial statements as Goodwill or Capital Reserve as the case may be.

k) As far as possible, the consolidated financial statements are prepared using uniformaccounting policies for like transactions and other events in similar circumstances andare presented in the same manner as the Company’s separate financial statements.

B. Investments other than in subsidiaries and associates have been accounted as perAccounting Standard (AS) 13 on "Ac- counting for Investments".

C. Other significant accounting policies

These are set out under "Significant Accounting Policies" as given in theCompany’s separate financial statements.

Notes on Consolidated Financial Statements for the Year ended 31st March, 2014

The previous year figures have been regrouped / reclassified, wherever necessary toconform to the current year presentation.

1. SHARE CAPITAL

(Rs. in crore)

As at 31st March, 2014 As at 31st March, 2013
Authorised Share Capital:
500,00,00,000 Equity Shares of Rs. 10 each 5,000 5,000
(500,00,00,000)
100,00,00,000 Preference Shares of Rs. 10 each 1,000 1,000
(100,00,00,000)
6,000 6,000
Issued, Subscribed and Paid up:
293,95,47,231 Equity Shares of Rs. 10 each fully paid up 2,940 2,936
(293,63,08,755)
Less: Calls in arrears - by others - -
[Rs. 3,113 (Previous Year Rs. 3,653)]
2940 2,936
TOTAL 2,940 2,936

 

1.1 1,45,94,41,214 Shares were allotted as Bonus Shares in the last five years by capitalisation of Securities Premium and Reserves.
(1,45,94,41,214)
1.2 6,92,52,419 Shares were allotted in the last five years pursuant to the Scheme of amalgamation with Reliance
(6,92,52,419) Petroleum Limited without payments being received in cash.
1.3 45,04,27,345 Shares were allotted on conversion / surrender of Debentures and Bonds, conversion of Term
(45,04,27,345) Loans, exercise of warrants, against Global Depository Shares (GDS) and re-issue of forfeited equity shares, since inception.
1.4 4,62,46,280 Shares were bought back and extinguished in the last five years.
(4,62,46,280)

1.5 The reconciliation of the number of shares outstanding is set out below :

Particulars As at 31st March, 2014 As at 31st March, 2013
No. of Shares No. of Shares
Equity Shares at the beginning of the year 293,63,08,755 297,87,04,713
Add : Shares issued on exercise of Employee Stock Options 32,38,476 1,86,891
Less : Shares cancelled on buy back of Equity Shares - 4,25,82,849
Equity Shares at the end of the year 293,95,47,231 293,63,08,755

1.6 The Company has reserved issuance of 13,05,05,114 (Previous year 13,37,43,590)Equity Shares of Rs. 10 each for offering to eligible employees of the Company and itssubsidiaries under Employees Stock Option Scheme (ESOS). During the year, the Company hasgranted 60,866 (Previous Year NIL) options to the eligible employees at a price of Rs. 860per option plus all applicable taxes, as may be levied in this regard on the Company. Theoptions would vest over a maximum period of 7 years or such other period as may be decidedby the Human Resources, Nomination and Remuneration Commitee from the date of grant basedon specified criteria.

1.7 Issued, Subscribed and paid up capital excludes 29,23,54,627 (Previous Year29,23,54,627) equity shares directly held by subsidiaries/trust, before their becomingsubsidiaries of the Company, which have been eliminated.

1.8 Share application money pending allotment represents application money receivedon account of employees stock option scheme.

2. RESERVES AND SURPLUS

(Rs. in crore)

As at 31st March, 2014 As at 31st March, 2013
Capital Reserve
As per last Balance Sheet 572 603
Add: On Consolidation of Subsidiaries (Net) (280) 49
292 652
Less: Transferred to Profit and Loss Account (Refer Note No. 11.7) 85 80
207 572
Exchange Fluctuation Reserve
As per last Balance Sheet 1,097 1,069
Add : During the year 706 28
1,803 1,097
Capital Redemption Reserve
As per last Balance Sheet 56 13
Add : Transferred from Profit and Loss Account on 38 43
buy back / redemption of Shares
94 56
Securities Premium Reserve
As per last Balance Sheet 42,226 45,258
Add : On issue of shares 205 12
42,431 45,270
Less : On buy back of Equity Shares - 3,044
42,431 42,226
Less : Calls in arrears - by others - -
[Rs. 1,93,288 (Previous Year Rs. 2,21,548)]
42,431 42,226
Debentures Redemption Reserve
As per last Balance Sheet 1,117 1,117
Statutory Reserve
As per last Balance Sheet 86 78
Add : Transferred from Minority Interest - 2
Add : Transferred from Profit and Loss Account 14 6
100 86
Revaluation Reserve
As per last Balance Sheet 1,661 3,740
Add: On Revaluation 346 -
2,007 3,740
Less: Transferred to Profit and Loss Account 1,083 2,081
(Refer Note No. 11.7)
Add: Transferred from / (to) Minority Interest (76) 2
848 1,661
General Reserve*
As per last Balance Sheet 1,18,004 1,00,004
Add: Transferred from Profit and Loss Account 18,000 18,000
Less: Transferred to Profit and Loss Account (Refer Note No. 11.7) 790 -
1,35,214 1,18,004

 

As at 31st March, 2014 As at 31st March, 2013
Share in Reserves of Associates
Revaluation Reserve
As per last Balance Sheet 10 10
Profit and Loss Account
As per last Balance Sheet 14,265 14,574
Less: Adjustment arising out of Scheme of Arrangement and Amalgamation# 1,532 -
(Short) Provision of Tax for earlier years (net) - (54)
(Rs. 8,26,209)
(Short) Provision of Tax for earlier years (net) - Minority Interest - -
[(Rs. 781), Previous Year (Rs. 43,379)]
Less: Expenses on Amalgamation - 10
Add: Profit for the year 22,493 20,879
35,226 35,389
Less: Appropriations
Transferred to Statutory Reserve 14 6
Transferred to General Reserve 18,000 18,000
Transferred to Capital Redemption Reserve on buy back / redemption of Shares 38 43
Proposed Dividend on Equity Shares** 2,793 2,628
[Dividend per Share Rs. 9.5/- ; (Previous Year Rs. 9.0/-)]
Tax on Dividend** 475 447
Proposed Dividend on preference shares - -
(Minority Interest Rs. 9,749/- ; Previous Year Rs. 19,880/-)
Tax on Dividend on Preference Shares - -
(Minority Interest Rs. 1,657/- ; Previous Year Rs. 3,379/-)
13,906 14,265
TOTAL 1,95,730 1,79,094

* Cumulative amount withdrawn on account of Depreciation on Revaluation is Rs. 3,353crore (Previous Year Rs. 2,563 crore).

** Proposed Dividend on Equity Shares and Tax on Dividend are net of reversal of excessprovision of previous year pertaining to Equity Shares bought back before the record dateof Dividend, aggregating to Rs. NIL (Previous Year Rs. 17 crore).

# Net effect of the various Scheme of Arrangement and Amalgamation (‘theScheme’) filed by the subsidiary Companies under the sections 391 to 394 of theCompanies Act, 1956 sanctioned by the Hon’ble High Court of Judicature at Bombay.

2.1 In view of the loss for the year, the subsidiary Company Reliance Jio InfocommLimited has not created the Debenture Redemption Reserve for a cumulative amount of Rs.352 crore (Previous Year Rs. 252 crore) in terms of section 117C of the Companies Act,1956. The Company shall create the Debenture Redemption Reserve out of profits, if any, inthe future years.

3. LONG TERM BORROWINGS

(Rs. in crore)

As at 31st March, 2014 As at 31st March, 2013
Non Current Current Non Current Current
Secured
Non Convertible Debentures 1,434 434 1,842 4,182
Term Loans from Banks 3,138 - 7 4
Long Term Maturities of Finance Lease Obligations 21 13 32 11
4,593 447 1,881 4,197
Unsecured
Bonds / Debentures 32,407 - 28,347 -
Term Loans- from Banks 63,775 4,500 40,726 13,697
Term Loans- from Others 241 -
Deferred Payment Liabilities 3 3 6 3
96,426 4,503 69,079 13,700
TOTAL 1,01,019 4,950 70,960 17,897

3.1 Non Convertible Debentures referred above to the extent of:

a) Rs. 370 crore are secured by way of first mortgage / charge on the immovableproperties situated at Hazira Complex and at Jamnagar Complex (other than SEZ units) ofthe Company.

b) Rs. 917 crore are secured by way of first mortgage / charge on all the propertiessituated at Hazira Complex and at Patalganga Complex of the Company.

c) Rs. 30 crore are secured by way of first mortgage / charge on certain propertiessituated at Surat in the State of Gujarat and on fixed assets situated at AllahabadComplex of the Company.

d) Rs. 51 crore are secured by way of first mortgage / charge on movable and immovableproperties situated at Thane in the State of Maharashtra and on movable propertiessituated at Baulpur Complex of the Company.

e) Rs. 500 crore are secured by way of first mortgage / charge on the immovableproperties situated at Jamnagar Complex (SEZ unit) of the Company.

3.2 Secured Term Loans from banks referred above to the extent of:

a) Rs. 3127 crore are secured by way of mortgage on Oil and Gas properties outsideIndia and related assets.

b) Rs. 11 crore are secured by way of hypothecation of vehicles and are repayable overa period of 2 to 5 years.

3.3 Finance Lease Obligations are secured against leased assets.

4. DEFERRED TAX LIABILITY (Net)

(Rs. in crore)

As at 31st March, 2014 As at 31st March, 2013
Deferred Tax Liability
Related to fixed assets 16,282 14,682
Deferred Tax Assets
Related to fixed assets 27 38
Disallowances under the Income Tax Act 176 109
Carried forward loss of subsidiaries 4,154 2,947
4,357 3,094
TOTAL 11,925 11,588

5. OTHER LONG TERM LIABILITIES

(Rs. in crore)

As at 31st March, 2014 As at 31st March, 2013
Others # 807 -
TOTAL 807 -

# Includes Premium payable on forward contracts, Liability on revaluation offorward contracts and exchange loss.

6. LONG TERM PROVISIONS

(Rs. in crore)

As at 31st March, 2014 As at 31st March, 2013
Provisions for Annuities 226 231
Others # 64 300
TOTAL 290 531

# Includes provision for Decommissioning and Liability for derivative transactions.

7. SHORT TERM BORROWINGS

(Rs. in crore)

As at 31st March, 2014 As at 31st March, 2013
Secured
Working Capital Loans
From Banks
Foreign Currency Loans 828 601
Rupee Loans 7,566 27
8,394 628
From Others
Rupee Loans 1,199 -
Unsecured
A. Other Loans and Advances
From Banks
Foreign Currency Loans * 23,128 17,569
Rupee Loans 9 110
23,137 17,679
B. Loans from related parties (Refer Note No. 28) 62 55
TOTAL 32,792 18,362

* Includes Buyers Credit/Packing Credit

7.1 Working Capital Loans from Banks referred above to the extent of:

(a) Rs. 3,906 crore are secured by hypothecation of present and future stock of rawmaterials, stock-in-process, finished goods, stores and spares (not relating to plant andmachinery), book debts, outstanding monies, receivables, claims, bills, materials intransit, etc. save and except receivables of Oil and Gas Division.

(b) Rs. 3,281 crore are secured by way of lien on fixed deposits and Rs. 978crore are secured by lien on Government Securities.

(c) Rs. 229 crore is secured by hypothecation of Plant and Machinery.

7.2 Working Capital Loan from Others of Rs. 1,199 crore are securedby lien on Government Securities.

8. TRADE PAYABLES

(Rs. in crore)

As at 31st March, 2014 As at 31st March, 2013
Micro, Small and Medium Enterprises 109 66
Others 60,751 49,634
TOTAL 60,860 49,700

9. OTHER CURRENT LIABILITIES

(Rs. in crore)

As at 31st March, 2014 As at 31st March, 2013
Current maturities of long term debt 4,937 17,886
Current maturities of finance lease obligations 13 11
(Refer Note No. 3) 4,950 17,897
Interest accrued but not due on borrowings 612 690
Unclaimed Dividend # 175 152
Application money received and due for refund # 1 1
Unpaid matured debentures and interest accrued thereon # 1 1
Other Payables * 11,319 4,914
TOTAL 17,058 23,655

* Includes statutory dues, security deposit, Creditors for Capital expenditure, advancefrom customers and Income received in advance.

# These figures do not include any amounts, due and outstanding, to be credited toInvestor Education and Protection Fund except Rs. 12 crore (Previous Year Rs. 10 crore)which is held in abeyance due to legal cases pending.

10. SHORT TERM PROVISIONS

(Rs. in crore)

As at 31st March, 2014 As at 31st March, 2013
Provisions for Employee Benefits 244 194
Proposed Dividend 2,793 2,643
Tax on Dividend 475 449
Provision for Wealth Tax 61 46
Provision for Income Tax (Net of advance tax) 25 7
Other Provisions * 848 1,218
TOTAL 4,446 4,557

* Includes primarily provision for Customs duty, Excise Duty on Finished Goods, Otherduties and taxes.

11. FIXED ASSETS

(Rs. in crore)

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Gross Block Depreciation / Amortisation Net Block
Description As at 01-04-2013 Additions/ Adjustments Deductions/ Adjustments As at 31-03-2014 As at 01-04-2013 For the Year# Deductions/ Adjustments As at 31-03-2014 As at 31-03-2014 As at 31-03-2013
TANGIBLE ASSETS :
OWN ASSETS :
Leasehold Land 2,809 245 394 2,660 500 108 20 588 2,072 2,309
Freehold Land 6,482 238 2 6,718 - - - - 6,718 6,482
Buildings 11,939 1,324 22 13,241 3,432 365 32
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Futures & Options Quote
Expiry Date :
1,006.60    [14.45] ([1.42]%)
Instrument: FUTSTK
Expiry Date: 31-Jul-2014
Open Price: 1,020.10
Average Price: 1,009.85
No. of Contracts Traded: 32,642
Open Interest: 1,19,72,750
Underlying: RELIANCE
Market Lot: 250
Previous Close: 1,006.60
Day's High | Low: 1,023.15 | 1,001.50
Turnover (Cr.): 824.09
Open Int. Change: 0,34,40,500 ([22.32]% )
Key Information

Key Executives:

Mukesh D Ambani , Chairman & Managing Director

Nikhil Rasiklal Meswani , Executive Director

Hital R Meswani , Executive Director

Mansingh Laxmidas Bhakta , Director


Company Head Office / Quarters:

3rd Floor Maker Chambers IV,
222 Nariman Point,
Mumbai,
Maharashtra-400021
Phone : Maharashtra-91-22-22785000 / Maharashtra-
Fax : Maharashtra-91-22-22785111 / Maharashtra-
E-mail : investor_relations@ril.com
Web : http://www.ril.com

Registrars:

Karvy Computershare Pvt Ltd
Plot No 17-24 ,Vittal Rao Nagar ,Madhapur ,Hyderabad-500081

 
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