RIL sees projects worth $35 bn getting on stream in FY17
05 August 2016
Reliance Industries Ltd (RIL) expects to bring alive projects, including expansion of petrochemical projects, with total investment of $35 billion, in 2016-17. The completion of these project would place RIL among the top 10 global producers in the sector.
RIL has also sought shareholders' approval to raise Rs10,000 crore through non-convertible debentures (NCDs) this financial year.
Addressing shareholders of the company, Mukesh Ambani, chairman of Reliance Industries invested over Rs112,000 crore ($17 billion) in its various businesses operations during 2015-16, which he claimed was the highest-ever by any corporate in India in creating growth engines for the future.
RIL said with the completion of its petrochemical plant expansion, the company would have the capacity and earning potential of a top producer in the world. It is also upbeat on the impending launch of the Reliance Jio Infocomm telecom service.
Assuring shareholders that significant progress has been made in erecting the infrastructure for Reliance Jio, along with some 1.5 million test users, Ambani said the commercial launch will happen in the "coming months''. He did not, however, specify the date.
RIL said Reliance Jio Infocomm will launch its 4G LTE services at "substantially lower "rates than rivals, rekindling fears of a bruising tariff war in an already competitive industry.
RIL also expanded its fuel retail pump network to 1,000 and hopes to expand network further. "Both Reliance and its partner BP are evaluating the new policy and investment plans to develop discovered resources," the company stated.
"In the polyester chain, we added substantial volumes in an effort to further integrate our business ...Reliance is confident of placing all our incremental output from the new projects in the domestic markets to meet India's growing demand," chairman Mukesh Ambani said in a letter to shareholders.
"The ability to operate at high utilisation levels and switch product to suit market conditions enabled RIL to capture margin optimisation opportunities in the market. Overall, effective utilisation of secondary processing units, innovative approach to optimise logistics cost and utilisation, production flexibility to swing to higher netback products and sourcing of best value crude and feedstock-enabled RIL to sustain its performance even in a challenging margin environment,'' Ambani stated.
During the year, RIL and its subsidiaries arranged long-term foreign currency facilities of about $6.3 billion. RIL, which reported a gross refining margin of $10.8 a barrel in 2015-16, managing to outperform the Singapore benchmark with a premium of $3.3 a barrel, expects margin pressure, but hopes to perform better than the benchmark.