The Board of Directors are pleased to present the Company's Fortieth Annual Report(Post-IPO) and the Company's audited financial statements (standalone and consolidated)for the financial year ended March 31 2017.
The Company's financial performance for the year ended March 31 2017 is summarisedbelow:
| ||STANDALONE ||CONSOLIDATED |
| || |
| ||Rs. crore ||US$ million* ||Rs. crore ||US$ million* ||Rs. crore ||US$ million* ||Rs. crore ||US$ million* |
|PROFIT BEFORE TAX ||40777 ||6288 ||36016 ||5436 ||40034 ||6173 ||38737 ||5847 |
|Less: Current Tax ||8333 ||1285 ||7801 ||1177 ||8880 ||1369 ||8042 ||1214 |
|Deferred Tax ||1019 ||157 ||831 ||125 ||1321 ||204 ||834 ||126 |
|PROFIT FOR THE YEAR ||31425 ||4846 ||27384 ||4134 ||29833 ||4600 ||29861 ||4507 |
|Add: Other Comprehensive Income ||2192 ||338 ||838 ||126 ||1827 ||282 ||946 ||143 |
|TOTAL COMPREHENSIVE INCOME FOR THE YEAR ||33617 ||5184 ||28222 ||4260 ||31660 ||4882 ||30807 ||4650 |
|Less: Total Comprehensive Income attributable to Non Controlling Interest ||- ||- ||- ||- ||(64) ||(10) ||111 ||17 |
| || || || || || || || || |
|TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO OWNERS OF THE COMPANY ||33617 ||5184 ||28222 ||4260 ||31724 ||4892 ||30696 ||4633 |
| || || || || || || || || |
|Add: Balance in Profit and Loss Account (Adjusted) ||25679 ||4638 ||26716 ||4794 ||7851 ||1393 ||7268 ||1304 |
|Add: Transferred from Capital Reserve Account ||- ||- ||- ||- ||- ||- ||839 ||127 |
|Add: On account of Amalgamation / Disposal of Subsidiaries ||- ||- ||- ||- ||(252) ||(39) ||(65) ||(10) |
| || || || || || || || || |
|Add: Movement in Other Comprehensive Income || || || || ||- ||- ||(1589) ||(240) |
|SUB-TOTAL ||59296 ||9822 ||54938 ||9054 ||39323 ||6246 ||37149 ||5814 |
|LESS: APPROPRIATION || || || || || || || || |
|Transferred to Statutory Reserve ||- ||- ||- ||- ||66 ||10 ||35 ||5 |
|Transferred to General Reserve ||24790 ||3823 ||22000 ||3321 ||24790 ||3823 ||22000 ||3321 |
|Transferred to Capital Redemption Reserve ||- ||- ||- ||- ||- ||- ||1 ||0 |
|Transferred to Debenture Redemption Reserve ||- ||- ||- ||- ||- ||- ||3 ||0 |
|Dividend on Equity Shares ||- ||- ||6039 ||911 ||- ||- ||6039 ||911 |
|Tax on dividend ||- ||- ||1220 ||184 ||- ||- ||1220 ||184 |
|CLOSING BALANCE INCLUDING OTHER COMPREHENSIVE INCOME ||34506 ||5999 ||25679 ||4638 ||14467 ||2413 ||7851 ||1393 |
* 1 US$ = 64.85 Exchange Rate as on March 31 2017 (1 US$ = 66.25 as on March 31 2016)
Figures for FY 2015-16 have been restated as per Ind AS and therefore may not becomparable with financials for FY 2015-16 approved by the Directors and disclosed in thefinancial statement of previous year.
INDIAN ACCOUNTING STANDARD
The Ministry of Corporate Affairs (MCA) on February 16 2015 notified that IndianAccounting Standards (Ind AS) are applicable to certain classes of companies from April 12016 with a transition date of April 1 2015. Ind AS has replaced the previous Indian GAAPprescribed under Section 133 of the Companies Act 2013 ("the Act") read withRule 7 of the Companies (Accounts) Rules 2014. Ind AS is applicable to the Company fromApril 1 2016.
The reconciliations and descriptions of the effect of the transition from previous GAAPto Ind AS have been set out in Note 41 in the notes to accounts in the standalonefinancial statement and in Note 42 in the notes to accounts in the consolidated financialstatement.
RESULTS OF OPERATIONS AND THE STATE OF COMPANY'S AFFAIRS
THE HIGHLIGHTS OF THE COMPANY'S
PERFORMANCE STANDALONE FOR THE YEAR ENDED MARCH 31 2017 ARE AS UNDER:
Revenue from operations increased by 5.5 % to 265041 crore (US$ 40.9 billion).
Exports increased 0.6% to 147755 crore (US$ 22.8 billion).
PBDIT increased by 10.2% to 51965 crore (US$ 8.0 billion). Profit before Tax increasedby 13.2 % to 40777 crore (US$ 6.3 billion).
Cash Profit increased by 11.2% to 40909 crore (US$ 6.3 billion).
Net Profit increased by 14.8 % to 31425 crore (US$ 4.8 billion).
Gross Refining Margin stood at US$ 11.0 / bbl for the year ended March 31 2017.
FINANCIAL PERFORMANCE REVIEW AND ANALYSIS CONSOLIDATED
The Company achieved a consolidated turnover of 330180 crore (US$ 50.9 billion) forthe year ended March 31 2017 an increase of 12.6% as compared to 293298 crore in theprevious year. Increase in revenue is primarily on account of increase in prices ofrefining and petrochemical products partially offset by lower volumes from E&Pbusiness. Turnover was also boosted by robust growth in retail business which recorded a60.2% surge in turnover to 33765 crore.
Brent crude oil price averaged US$ 48.6/bbl in FY2016-17 as compared to US$ 47.5/bbl inthe previous year. Exports (including deemed export) from India were marginally higher at147755 crore (US$ 22.8 billion) as against 146855 crore in the previous year.
During FY 2016-17 the Company took significant steps towards completion of the ongoinghydrocarbon projects with the commissioning of Para-xylene (PX) plant at Jamnagar makingit the 2nd largest producer of PX globally. During the year the Companycompleted the world's largest and most complex ethane project. It commissioned ethanereceipt and handling facilities at its Dahej manufacturing facilities in a record time ofless than three years. The Refinery Off-Gas Cracker (ROGC) and downstream projects as wellas gasiffcation linked to DTA refinery achieved the installation and mechanical completionduring the year and pre-commissioning and start up activities are in full swing. Theinstallation and mechanical completion for the gasiffcation linked to the Company's SEZrefinery has also been substantially achieved. The completion of the hydrocarbon capexcycle will significantly enhance the Company's cash flows and impart a high degree ofstability to its earnings stream.
The Board of Directors has recommended a dividend of 11/- (that is 110%) per equityshare of Rs.10/- each (last year 10.50 per equity share) for the financial year endedMarch 31 2017 amounting to 3916 crore (inclusive of dividend distribution tax of 661crore). The dividend payment is subject to approval of members at the ensuing AnnualGeneral Meeting.
The dividend payout is in accordance with the Company's Dividend Distribution Policy.
The Dividend Distribution Policy of the Company is annexed herewith as Annexure Ito this Report.
MATERIAL CHANGES AFFECTING THE COMPANY
There have been no material changes and commitments affecting the financial position ofthe Company between the end of the financial year and date of this Report. There has beenno change in the nature of business of the Company.
MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT
Management's Discussion and Analysis Report for the year under review as stipulatedunder the Securities and
Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 ("Listing Regulations") is presented in a separate section forming part ofthe Annual Report.
The developments in business operations/performance of major subsidiaries consolidatedwith the Company are as below:
REFINING & MARKETING BUSINESS
The revenue from the R&M segment increased y-o-y to 250833 crore (US$38.7billion) reflecting higher average oil prices and volumes during the year. Refining EBITincreased by 6.5% y-o-y to a record level of 25056 crore (US$ 3.9 billion) supported bystrong product demand lower freight rates and effective crude sourcing and robust riskmanagement. At US$11.0/bbl refining margins were at an 8 (eight) year high. Premium overSingapore GRM was also at an 8 (eight) year high of US$5.2/bbl.
The revenue from the Petrochemicals segment increased by 12.2% y-o-y to 92472 crore(US$ 14.3 billion) primarily due to increase in prices across polymers and polyesterchain. Petrochemicals segment EBIT increased sharply by 27.5% to 12990 crore (US$ 2.0billion) supported by favourable product deltas and marginal volume growth. PetrochemicalEBIT margins were at 5 (five) years high at the level of 14%.
OIL AND GAS EXPLORATION & PRODUCTION BUSINESS
During the year the Company commenced commercial production from its Coal Bed Methaneblock (CBM) at Sohagpur (West). The CBM project is India's largest surface hydrocarbonproject. The revenues for the domestic oil and gas operations declined by 34.6% to Rs.2787 crore. This was largely on account of 23% decline in production and reduced gasprice realisation. Consequently domestic upstream operations registered negative EBIT ofRs. (131) crore. In the US Shale operations weaker Natural Gas differentials in theMarcellus region along with lower volumes resulted in lower revenues and EBITDA. Thebusiness is taking a cautious approach to resuming development and focusing on conservingcash and retaining optionality.
Reliance Retail achieved a turnover of Rs. 33765 crore in FY 2016- 17 as against Rs.21075 crore during the previous year registering a strong growth of 60.2%. The businessdelivered record profits during the year with an EBIT of Rs. 784 crore as against Rs. 504crore in the previous year.
Reliance Retail added 371 stores during the year. It operated 3616 stores across 702cities with an area of over 13.5 million square feet. In addition to the retail storesReliance Retail operated 448 fuel outlets as on March 31 2017.
Reliance Jio announced the commencement of services with Jio Welcome Offer' inSeptember 2016. In a short period of 170 days Jio crossed a milestone of 100 millioncustomers on its all IP wireless broadband network reflecting an unprecedented level ofacceptance for any technology company globally.
In February 2017 Jio announced industry redefining tariff plans as it embarked uponthe world's largest migration from free to paid services. It announced the Jio PrimeMembership for its initial customers and within a month of announcing the Jio Prime offerover 72 million Jio customers signed up for Jio Prime making it one of the mostsuccessful customer privilege programmes anywhere in the world.
Within 6 months of the launch of Jio India became the highest mobile data userglobally with a monthly consumption of over 1 billion GB. This level of growth has beenunprecedented on any mobile network anywhere in the world and is a testimony to thecomprehensive digital ecosystem that Jio has created.
Jio continues to expand its current LTE network coverage foot print and is alsodeploying Fiber-to-the-home (FTTH) technology for wire-line broadband and Carrier-Wi-Fitechnologies for broadband via public hotspots.
MEDIA AND ENTERTAINMENT
Network18 improved its market-standing and continued investing for growth in what was atumultuous year for the media industry. The operating revenues on a consolidated basisstood at 1491 crore down by 2.4% from 1527 crore in FY 2015-16.
Driven by sustained investments into new businesses and entry into more regionalmarkets Network18 reported an consolidated EBIT of (201) crore for FY 2016-17 as against173 crore in FY 2015-16.
The Company's financial discipline and prudence is reflected in the strong creditratings ascribed by rating agencies as given below:
|Instrument ||Rating Agency ||Rating ||Outlook ||Remarks |
|International Debt ||S&P ||BBB+ ||Stable ||Two notches above India's sovereign rating |
|International Debt ||Moody's ||Baa2 ||Stable ||One notch above India's sovereign rating |
|Long Term Debt ||CRISIL ||CRISIL AAA ||Stable ||Highest rating awarded by CRISIL |
|Long Term Debt ||India Ratings ||IND AAA ||Stable ||Highest rating awarded by India Rating |
CONSOLIDATED FINANCIAL STATEMENT
In accordance with the Act and Ind AS 110 - Consolidated Financial Statements read withInd AS 28 - Investments in Associates and Ind AS 31 - Interests in Joint Ventures theaudited consolidated financial statement is provided in the Annual Report.
SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES
During the year under review companies listed in Annexure II to this Reporthave become or ceased to be Company's subsidiaries joint ventures or associate companies.
A statement containing the salient features of the financial statement of subsidiary/associate/ joint venture companies is provided as Annexure A to the consolidated financialstatement and therefore not repeated to avoid duplication.
The audited financial statement including the consolidated financial statement of theCompany and all other documents required to be attached thereto may be accessed on theCompany's website at the link: http://www.ril.com/InvestorRelations/FinancialReporting.aspx. The financial statements of each of thesubsidiaries may also be accessed on the Company's website at the link:http://www.ril.com/ InvestorRelations/Downloads.aspx. These documents will also beavailable for inspection on all working days that is except Saturdays Sundays andPublic Holidays at the Registered Office of the Company.
The Company has formulated a policy for determining material subsidiaries. The Policymay be accessed at the link: http://www. ril.com/InvestorRelations/Downloads.aspx.
DIRECTORS' RESPONSIBILITY STATEMENT
Your Directors state that: a) in the preparation of the annual accounts for the yearended March 31 2017 the applicable accounting standards read with requirements set outunder Schedule III to the Act have been followed and there are no material departuresfrom the same;
b) the Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at March 31 2017 and of the profit ofthe Company for the year ended on that date;
c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) the Directors have prepared the annual accounts on a going concern basis;
e) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and
f) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.
The Company is committed to maintain the highest standards of Corporate Governance andadhere to the Corporate Governance requirements set out by the Securities and ExchangeBoard of India (SEBI). The Company has also implemented several best Corporate Governancepractices as prevalent globally. The report on Corporate Governance as stipulated underthe Listing Regulations forms an integral part of this Report. The requisite certificatefrom the Auditors of the Company confirming compliance with the conditions of CorporateGovernance is attached to the Report on Corporate Governance.
The 16th ICSI National Awards for Excellence in Corporate Governance werepresented to the best Governed Companies by The Institute of Company Secretaries of India(ICSI) and the
Company was presented the prestigious ICSI Certificate of Recognition for Excellence inCorporate Governance for the year 2015-16.
BUSINESS RESPONSIBILITY REPORT
As stipulated under the Listing Regulations the Business Responsibility Reportdescribing the initiatives taken by the Company from an environmental social andgovernance perspective is attached as part of the Annual Report.
CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
All contracts / arrangements / transactions entered by the Company during the financialyear with related parties were in ordinary course of business and on arms' length basis.
During the year the Company had not entered into any contract / arrangement /transaction with related parties which could be considered material in accordance with thePolicy of the Company on materiality of related party transactions.
The Policy on materiality of related party transactions and on dealing with relatedparty transactions as approved by the Board may be accessed on the Company's website atthe link: http:// www.ril.com/InvestorRelations/Downloads.aspx
There are no materially significant related party transactions that may have potentialconflict with interest of the Company at large.
Members may refer to Note 30 to the standalone financial statement which sets outrelated party disclosures pursuant to Ind AS.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Board is pleased to inform that the Company was presented the first ICSI CSRExcellence Award in the large category in the ICSI CSR Excellence Awards functionorganised by The Institute of Company Secretaries of India (ICSI).
The Corporate Social Responsibility and Governance Committee (CSR&G Committee) hasformulated and recommended to the Board a Corporate Social Responsibility Policy (CSRPolicy) indicating the activities to be undertaken by the Company which has been approvedby the Board.
The CSR Policy may be accessed on the Company's website at the link:http://www.ril.com/InvestorRelations/Downloads.aspx
The key philosophy of all CSR initiatives of the Company is guided by three corecommitments of Scale Impact and Sustainability.
The Company has identified following focus areas for CSR engagement: RuralTransformation: Creating sustainable livelihood solutions addressing poverty hungerand malnutrition. Environment: Environmental sustainability ecological balanceconservation of natural resources and promoting bio-diversity.
Health: A ordable solutions for healthcare through improved access awarenessand health seeking behaviour. Education and Sports: Access to quality educationtraining and skill enhancement building sports & skills in young students.
Disaster Response: Managing and responding to disaster. Arts Heritage andCulture: Protection and promotion of India's arts culture and heritage.
The Company also undertakes other need based initiatives in compliance with ScheduleVII to the Act.
During the year the Company spent 659.20 crore (around 2.13% of the average netprofits of last three financial years) on CSR activities.
The annual report on CSR activities is annexed herewith marked as Annexure III.
Your Company has an elaborate Group Risk Management Framework which is designed toenable risks to be identified assessed and mitigated appropriately. The Risk ManagementCommittee of the Company has been entrusted with the responsibility to assist the Board in(a) Overseeing and approving the Company's enterprise wide risk management framework; and(b) Overseeing that all the risks that the organisation faces such as financial creditmarket liquidity security property IT legal regulatory reputational and other riskshave been identified and assessed and there is an adequate risk management infrastructurein place capable of addressing those risks.
More details on Risk Management indicating development and implementation of RiskManagement policy including identification of elements of risk and their mitigation arecovered in Management's Discussion and Analysis which forms part of this Report.
INTERNAL FINANCIAL CONTROLS
Internal Financial Controls are an integrated part of the risk management processaddressing financial and financial reporting risks. The internal financial controls havebeen documented digitised and embedded in the business processes.
Assurance on the effectiveness of internal financial controls is obtained throughmanagement reviews control self-assessment continuous monitoring by functional expertsas well as testing of the internal financial control systems by the internal auditorsduring the course of their audits. We believe that these systems provide reasonableassurance that our internal financial controls are designed effectively and are operatingas intended.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with the provisions of the Act and the Articles of Association of theCompany Smt. Nita M. Ambani and Shri Hital R. Meswani Directors of the Company retireby rotation at the ensuing Annual General Meeting and being eligible have offeredthemselves for re-appointment.
The term of Shri P. K. Kapil and Shri Nikhil R. Meswani as Whole-time Director is up toMay 15 2018 and June 30 2018 respectively. The Board of Directors on the recommendationof the Human Resources Nomination and Remuneration Committee has re-appointed Shri P. K.Kapil and Shri Nikhil R. Meswani as Whole-time Directors of the Company for a period of 5(five) years with effect from May 16 2018 and July 01 2018 respectively subject toapproval of shareholders.
The first term of office of Shri Yogendra P. Trivedi Prof. Ashok Misra Shri MansinghL. Bhakta Dr. D. V. Kapur Prof. Dipak C. Jain and Dr. Raghunath A. Mashelkar asIndependent Directors expires at the ensuing Annual General Meeting. Dr. D. V. Kapur hasrequested the Board not to consider him for re-appointment and relieve him from the officeof the director after the expiry of his present term. The Board has recommendedre-appointment of Shri Yogendra P. Trivedi Prof. Ashok Misra Shri Mansingh L. BhaktaProf. Dipak C. Jain and Dr. Raghunath A. Mashelkar as
Independent Directors of the Company for a second term of 5 (five) consecutive years.
The Board places on record its appreciation towards valuable contribution made by Dr.D. V. Kapur during his tenure as a Director of the Company.
Based on the recommendation of the Human Resources Nomination and RemunerationCommittee the Board has recommended that Dr. Shumeet Banerji be appointed as anIndependent Director by the members for a term of 5 (five) consecutive years.
The Company has received declarations from all the Independent Directors of the Companyand Dr. Shumeet Banerji confirming that they meet the criteria of independence prescribedunder the Act and the Listing Regulations.
The following policies of the Company are attached herewith marked as Annexure IV A andAnnexure IV B: a) Policy for selection of Directors and determining Directorsindependence; and b) Remuneration Policy for Directors Key Managerial Personnel and otheremployees.
The Company has devised a Policy for performance evaluation of the Board Committeesand other individual Directors (including Independent Directors) which includes criteriafor performance evaluation of the Non-executive Directors and Executive Directors. Theevaluation process inter alia considers attendance of Directors at Board and committeemeetings acquaintance with business communicating inter se board members effectiveparticipation domain knowledge compliance with code of conduct vision and strategybenchmarks established by global peers etc which is in compliance with applicable lawsregulations and guidelines.
The Board carried out annual performance evaluation of the Board Board Committees andIndividual Directors and Chairperson. The Chairman of the respective Board Committeesshared the report on evaluation with the respective Committee members. The performance ofeach Committee was evaluated by the Board based on report on evaluation received fromrespective Board Committees.
The reports on performance evaluation of the Individual Directors were reviewed by theChairman of the Board.
EMPLOYEES' STOCK OPTION SCHEME
The Human Resources Nomination and Remuneration Committee of the Board of Directors ofthe Company inter alia administers and monitors the Employees' Stock Option Scheme of theCompany which is in accordance with the applicable SEBI Regulations.
There is no material change in Employees' Stock Option Scheme during the year underreview and the Scheme is in line with the SEBI (Share Based Employee Benefits)Regulations 2014. The Company has received a certificate from the Auditors of the Companythat the Scheme has been implemented in accordance with the SEBI (Share Based EmployeeBenefits) Regulations 2014 and the resolution passed by the members. The certificatewould be placed at the Annual General Meeting for inspection by members.
Voting rights on the shares issued to employees under the Employees' Stock OptionScheme are either exercised by them directly or through their appointed proxy.
The details as required to be disclosed under the SEBI (Share Based Employee Benefits)Regulations 2014 are put on the Company's website at the link: http://www.ril.com/InvestorRelations/Downloads.aspx
AUDITORS AND AUDITORS' REPORT
As per the provisions of the Act the period of office of Chaturvedi & ShahChartered Accountants Deloitte Haskins & Sells LLP Chartered Accountants andRajendra & Co. Chartered Accountants Statutory Auditors of the Company expires atthe conclusion of the ensuing Annual General Meeting.
It is proposed to appoint S R B C & CO LLP Chartered
Accountants and D T S & Associates Chartered Accountants as Joint Auditors of theCompany for a term of 5 (five) consecutive years. S R B C & CO LLP CharteredAccountants and D T S & Associates Chartered Accountants have confirmed theireligibility and qualification required under the Act for holding the office as StatutoryAuditors of the Company.
The Notes on financial statement referred to in the Auditors' Report areself-explanatory and do not call for any further comments. The Auditors' Report does notcontain any qualification reservation adverse remark or disclaimer.
The Board appointed the following Cost Auditors for conducting the audit of costrecords of the Company for various segments for the FY 2016-17: (i) For Textiles Business- Kiran J. Mehta & Co. Cost Accountants;
(ii) For Chemicals Business - Diwanji & Associates Cost Accountants K.G. Goyal& Associates Cost Accountants V.J. Talati & Co. Cost Accountants Kiran J.Mehta & Co. Cost Accountants Shri Suresh D. Shenoy Cost Accountant Shome &Banerjee Cost Accountants and Dilip M. Malkar & Co. Cost Accountants;
(iii) For Polyester Business - V.J. Talati & Co. Cost Accountants Shri Suresh D.Shenoy Cost Accountant and V. Kumar & Associates Cost Accountants;
(iv) For Electricity Generation - Dilip M. Malkar & Co. Cost Accountants;
(v) For Petroleum Business Shri Suresh D. Shenoy Cost Accountant;
(vi) For Oil & Gas Business V.J. Talati & Co. Cost Accountants andShome & Banerjee Cost Accountants.
Shome & Banerjee Cost Accountants were nominated as the Company's Lead CostAuditors.
The Board appointed Dr. K.R. Chandratre Practising Company Secretary to conductSecretarial Audit for the FY 2016-17. The Secretarial Audit Report for the financial yearended March 31 2017 is annexed herewith marked as Annexure V to this Report. TheSecretarial Audit Report does not contain any qualification reservation adverse remarkor disclaimer.
MEETINGS OF THE BOARD
Six meetings of the Board of Directors were held during year. Particulars of meetingsheld and attended by each Director are detailed in the Corporate Governance Report whichforms part of this Report.
The Audit Committee comprises Independent Directors namely Shri Yogendra P. Trivedi(Chairman) Dr. Raghunath A. Mashelkar Shri Adil Zainulbhai and Shri Raminder SinghGujral. During the year all the recommendations made by the Audit Committee were acceptedby the Board.
CORPORATE SOCIAL RESPONSIBILITY AND GOVERNANCE COMMITTEE CSR&G
The CSR&G comprises Shri Yogendra P. Trivedi (Chairman) Shri Nikhil R. MeswaniDr. Dharam Vir Kapur and Dr. Raghunath A. Mashelkar.
The Vigil Mechanism of the Company which also incorporates a whistle blower policy interms of the Listing Regulations includes an Ethics & Compliance Task Force comprisingsenior executives of the Company. Protected disclosures can be made by a whistle blowerthrough an e-mail or dedicated telephone line or a letter to the Task Force or to theChairman of the Audit Committee. The vigil mechanism and whistle blower policy is put onthe Company's website and can be accessed at:http://www.ril.com/InvestorRelations/Downloads.aspx
PARTICULARS OF LOANS GIVEN
INVESTMENTS MADE GUARANTEES GIVEN AND SECURITIES PROVIDED
Particulars of loans given Investments made guarantees given and securities providedalong with the purpose for which the loan or guarantee or security is proposed tobe utilised by the recipient are provided in the standalone financial statement Pleaserefer Note 2 3 6 9 30 and 36 to the standalone financial statement.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The particulars relating to conservation of energy technology absorption foreignexchange earnings and outgo as required to be disclosed under the Act are provided in AnnexureVI to this Report.
EXTRACT OF ANNUAL RETURN
Extract of Annual Return of the Company is annexed herewith as Annexure VII tothis Report.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3)of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 asamended a statement showing the names and other particulars of the employees drawingremuneration in excess of the limits set out in the said rules are provided in the AnnualReport which forms part of this Report.
Disclosures relating to remuneration and other details as required under Section197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 are also provided in the Annual Report which forms partof this Report.
Having regard to the provisions of the first proviso to Section 136(1) of the Act andas advised the Annual Report excluding the aforesaid information is being sent to themembers of the Company. The said information is available for inspection at the registeredoffice of the Company during working hours and any member interested in obtaining suchinformation may write to the Company Secretary and the same will be furnished on request.
The Board of Directors state that no disclosure or reporting is required in respect ofthe following items as there were no transactions on these items during the year underreview:
1. Details relating to deposits covered under Chapter V of the Act.
2. Issue of equity shares with differential rights as to dividend voting or otherwise.
3. Issue of shares (including sweat equity shares) to employees of the Company underany scheme save and except Employees' Stock Option Scheme referred to in this Report.
4. The Company does not have any scheme of provision of money for the purchase of itsown shares by employees or by trustees for the benefit of employees.
5. Neither the Managing Director nor the Whole-time Directors of the Company receiveany remuneration or commission from any of its subsidiaries.
6. No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future.
7. No fraud has been reported by the Auditors to the Audit Committee or the Board.
The Board of Directors would like to express their sincere appreciation for theassistance and co-operation received from the financial institutions banks Governmentauthorities customers vendors and members during the year under review. The Boards ofDirectors also wish to place on record its deep sense of appreciation for the committedservices by the Company's executives staff and workers.
|For and on behalf of the Board of Directors |
|Mukesh D. Ambani |
|Chairman and Managing Director |
|Mumbai April 24 2017 |
DIVIDEND DISTRIBUTION POLICY
The Board of Directors (the "Board") of Reliance Industries Limited (the"Company") at its meeting held on April 24 2017 has adopted this DividendDistribution Policy (the "Policy") as required by Regulation 43A of the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 (the "ListingRegulations").
The objective of this Policy is to establish the parameters to be considered by theBoard of Directors of the Company before declaring or recommending dividend.
The Company has had an uninterrupted dividend payout since listing. In future theCompany would endeavor to pay sustainable dividend keeping in view the Company's policy ofmeeting the long-term growth objectives from internal cash accruals.
CIRCUMSTANCES UNDER WHICH THE SHAREHOLDERS MAY OR MAY NOT EXPECT DIVIDEND
The Board of Directors of the Company while declaring or recommending dividend shallensure compliance with statutory requirements under applicable laws including theprovisions of the Companies Act 2013 and Listing Regulations. The Board of Directorswhile determining the dividend to be declared or recommended shall take into considerationthe advice of the executive management of the Company and the planned and furtherinvestments for growth apart from other parameters set out in this Policy.
The Board of Directors of the Company may not declare or recommend dividend for aparticular period if it is of the view that it would be prudent to conserve capital forthe then ongoing or planned business expansion or other factors which may be considered bythe Board.
PARAMETERS TO BE CONSIDERED BEFORE RECOMMENDING DIVIDEND
The Board of Directors of the Company shall consider the following financial / internalparameters while declaring or recommending dividend to shareholders: Profits earned duringthe financial year Retained Earnings Earnings outlook for next three to five yearsExpected future capital / liquidity requirements Any other relevant factors and materialevents
The Board of Directors of the Company shall consider the following external parameterswhile declaring or recommending dividend to shareholders: Macro-economic environment -Significant changes in macro-economic environment materially affecting the businesses inwhich the Company is engaged in the geographies in which the Company operates Regulatorychanges Introduction of new regulatory requirements or material changes in existingtaxation or regulatory requirements which significantly affect the businesses in whichthe Company is engaged Technological changes which necessitate significant new investmentsin any of the businesses in which the Company is engaged
UTILISATION OF RETAINED EARNINGS
The Company shall endeavor to utilise the retained earnings in a manner which shall bebeneficial to the interests of the Company and also its shareholders.
The Company may utilize the retained earnings for making investments for future growthand expansion plans for the purpose of generating higher returns for the shareholders orfor any other specific purpose as approved by the Board of Directors of the Company.
PARAMETERS THAT SHALL BE ADOPTED WITH REGARD TO VARIOUS CLASSES OF SHARES
The Company has issued only one class of shares viz. equity shares. Parameters fordividend payments in respect of any other class of shares will be as per the respectiveterms of issue and in accordance with the applicable regulations and will be determinedif and when the Company decides to issue other classes of shares.
CONFLICT IN POLICY
In the event of any conflict between this Policy and the provisions contained in theListing Regulations the Listing Regulations shall prevail.
The Board may from time to time make amendments to this Policy to the extent requireddue to change in applicable laws and Listing Regulations or as deemed fit on a review.
|For and on behalf of Board of Directors |
|Mukesh D. Ambani |
|Chairman and Managing Director |
|Mumbai April 24 2017 |
COMPANIES WHICH BECAME / CEASED TO BE COMPANY'S SUBSIDIARIES JOINT VENTURES ORASSOCIATE COMPANIES:
1. Companies / Bodies Corporate which have become subsidiaries during the financialyear 2016-17:
|Sr. No. ||Name of the Company |
|1 ||Cluster Commercials Private Limited |
|2 ||Devashree Commercial Private Limited |
|3 ||Dignity Mercantile Private Limited |
|4 ||Girisha Commercials Private Limited |
|5 ||Jio Payments Bank Limited |
|6 ||Reliance Commercial Dealers Limited |
|7 ||Reliance Commercial Trading Private Limited |
|8 ||Reliance LNG Limited |
|2. ||Companies/ Bodies Corporate which ceased to be subsidiaries during the financial year 2016-17: |
|Sr. No. ||Name of the Company |
|1 ||Gapco Kenya Limited |
|2 ||Gapco Tanzania Limited |
|3 ||Gapco Uganda Limited |
|4 ||Gapoil (Zanzibar) Limited |
|5 ||GenNext Holding Investments LLC |
|6 ||Gulf Africa Petroleum Corporation |
|7 ||Reliance do Brasil Indstria the Comrcio de Produtos Txteis Qumicos Petroqumicos the Derivados Limiteda |
|8 ||Reliance Holding Acquisition Corp |
|9 ||Reliance USA Gas Marketing LLC |
3. Companies/ Bodies Corporate which ceased to be a joint venture or associate duringthe financial year 2016-17.
Reliance LNG Limited which was associate of the Company has become subsidiary of theCompany.
ANNEXURE IV A
POLICY FOR SELECTION OF DIRECTORS AND DETERMINING DIRECTORS' INDEPENDENCE
1.1 Reliance Industries Limited (RIL) believes that an enlightened Board consciouslycreates a culture of leadership to provide a long-term vision and policy approach toimprove the quality of governance. Towards this RIL ensures constitution of a Board ofDirectors with an appropriate composition size diversified expertise and experience andcommitment to discharge their responsibilities and duties effectively.
1.2 RIL recognises the importance of Independent Directors in achieving theeffectiveness of the Board. RIL aims to have an optimum combination of ExecutiveNon-Executive and Independent Directors.
2. SCOPE AND EXCLUSION:
2.1 This Policy sets out the guiding principles for the Human Resources Nomination andRemuneration Committee for identifying persons who are qualified to become Directors andto determine the independence of Directors in case of their appointment as independentdirectors of the Company.
3. TERMS AND REFERENCES:
In this Policy the following terms shall have the following meanings: 3.1 "Director"means a director appointed to the Board of a company.
3.2 "Human Resources Nomination and Remuneration Committee" means thecommittee constituted by RIL's Board in accordance with the provisions of Section 178 ofthe Companies Act 2013 and Regulation 19 of the Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015 ("ListingRegulations").
3.3 "Independent Director" means a director referred to in sub-section(6) of Section 149 of the Companies Act 2013 and Regulation 16 (1) (b) of ListingRegulations.
4.1 Qualifications and criteria
4.1.1 The Human Resources Nomination and
Remuneration (HRNR) Committee and the Board shall review on an annual basisappropriate skills knowledge and experience required of the Board as a whole and itsindividual members. The objective is to have a Board with diverse background andexperience that are relevant for the Company's global operations.
4.1.2 In evaluating the suitability of individual Board members the HRNR Committee maytake into account factors such as: General understanding of the Company's businessdynamics global business and social perspective; Educational and professional background;Standing in the profession; Personal and professional ethics integrity and values;Willingness to devote sufficient time and energy in carrying out their duties andresponsibilities effectively.
4.1.3 The proposed appointee shall also fulfill the following requirements: Shallpossess a Director Identification Number; Shall not be disqualified under the CompaniesAct 2013; Shall give his written consent to act as a Director;
Shall endeavour to attend all Board Meetings - and wherever he is appointed as aCommittee Member the Committee Meetings; Shall abide by the Code of Conduct establishedby the Company for Directors and Senior Management Personnel; Shall disclose his concernor interest in any company or companies or bodies corporate firms or other associationof individuals including his shareholding at the first meeting of the Board in everyfinancial year and thereafter whenever there is a change in the disclosures already made;Such other requirements as may be prescribed from time to time under the Companies Act2013 Listing Regulations and other relevant laws.
4.1.4 The HRNR Committee shall evaluate each individual with the objective of having agroup that best enables the success of the Company's business.
4.2 Criteria of Independence
4.2.1 The HRNR Committee shall assess the independence of Directors at the time ofappointment / re-appointment and the Board shall assess the same annually. The Board shallre-assess determinations of independence when any new interests or relationships aredisclosed by a Director. 4.2.2 The criteria of independence as laid down in CompaniesAct 2013 and Listing Regulations is as below: An independent director in relation to acompany means a non-executive director other than a managing director or a whole-timedirector or a nominee director a. who in the opinion of the Board is a person ofintegrity and possesses relevant expertise and experience; b. (i) who is or was not apromoter of the company or its holding subsidiary or associate company; (ii) who is notrelated to promoters or directors in the company its holding subsidiary or associatecompany; c. who has or had no pecuniary relationship with the company its holdingsubsidiary or associate company or their promoters or directors during the twoimmediately preceding financial years or during the current financial year; d. none ofwhose relatives has or had pecuniary relationship or transaction with the company itsholding subsidiary or associate company or their promoters or directors amounting totwo per cent or more of its gross turnover or total income or 50 lakh rupees or suchhigher amount as may be prescribed whichever is lower during the two immediatelypreceding financial years or during the current financial year; e. who neither himselfnor any of his relatives (i) holds or has held the position of a key managerialpersonnel or is or has been an employee of the company or its holding subsidiary orassociate company in any of the three financial years immediately preceding the financialyear in which he is proposed to be appointed; (ii) is or has been an employee orproprietor or a partner in any of the three financial years immediately preceding thefinancial year in which he is proposed to be appointed of - (A) a firm of auditors orcompany secretaries in practice or cost auditors of the company or its holding subsidiaryor associate company; or (B) any legal or a consulting firm that has or had anytransaction with the company its holding subsidiary or associate company amounting to 10per cent or more of the gross turnover of such firm; (iii) holds together with hisrelatives two per cent or more of the total voting power of the company; or (iv) is aChief Executive or director by whatever name called of any non-profit organisation thatreceives twenty-five per cent or more of its receipts or corpus from the company any ofits promoters directors or its holding subsidiary or associate company or that holds twoper cent or more of the total voting power of the company; or (v) is a material supplierservice provider or customer or a lessor or lessee of the company. f. shall possessappropriate skills experience and knowledge in one or more fields of finance lawmanagement sales marketing administration research corporate governance technicaloperations corporate social responsibility or other disciplines related to the company'sbusiness. g. shall possess such other qualifications as may be prescribed from time totime under the Companies Act 2013. h. who is not less than 21 years of age.
4.2.3 The Independent Directors shall abide by the
"Code for Independent Directors" as specified in Schedule IV to the CompaniesAct 2013.
4.3 Other directorships / committee memberships
4.3.1 The Board members are expected to have adequate time and expertise and experienceto contribute to effective Board performance. Accordingly members should voluntarilylimit their directorships in other listed public limited companies in such a way that itdoes not interfere with their role as directors of the Company. The HRNR Committee shalltake into account the nature of and the time involved in a Director's service on otherBoards in evaluating the suitability of the individual Director and making itsrecommendations to the Board.
4.3.2 A Director shall not serve as Director in more than 20 companies of which notmore than 10 shall be Public Limited Companies.
4.3.3 A Director shall not serve as an Independent Director in more than 7 ListedCompanies and not more than 3 Listed Companies in case he is serving as a Whole-timeDirector in any Listed Company.
4.3.4 A Director shall not be a member in more than 10 Committees or act as Chairman ofmore than 5 Committees across all companies in which he holds directorships.
For the purpose of considering the limit of the Committees Audit Committee andStakeholders' Relationship Committee of all Public Limited Companies whether listed ornot shall be included and all other companies including Private Limited CompaniesForeign Companies and Companies under Section 8 of the Companies Act 2013 shall beexcluded.
|For and on behalf of Board of Directors |
|Mukesh D. Ambani |
|Chairman and Managing Director |
|Mumbai April 24 2017 |
ANNEXURE IV B
REMUNERATION POLICY FOR DIRECTORS KEY MANAGERIAL PERSONNEL AND OTHER EMPLOYEES
1.1 Reliance Industries Limited (RIL) recognises the importance of aligning thebusiness objectives with specific and measureable individual objectives and targets. TheCompany has therefore formulated the remuneration policy for its directors key managerialpersonnel and other employees keeping in view the following objectives:
1.1.1 Ensuring that the level and composition of remuneration is reasonable andsufficient to attract retain and motivate to run the company successfully.
1.1.2 Ensuring that relationship of remuneration to performance is clear and meets theperformance benchmarks.
1.1.3 Ensuring that remuneration involves a balance between fixed and incentive payreflecting short and long term performance objectives appropriate to the working of thecompany and its goals.
2. SCOPE AND EXCLUSION:
2.1 This Policy sets out the guiding principles for the Human Resources Nomination andRemuneration Committee for recommending to the Board the remuneration of the directorskey managerial personnel and other employees of the Company.
3. TERMS AND REFERENCES:
In this Policy the following terms shall have the following meanings: 3.1 "Director"means a director appointed to the Board of the Company.
3.2 "Key Managerial Personnel" means
(i) the Chief Executive Officer or the Managing Director or the Manager; (ii) theCompany Secretary; (iii) the Whole-time Director; (iv) the Chief Financial Officer; and
(v) such other officer as may be prescribed under the Companies Act 2013 3.3 "HumanResources Nomination and Remuneration Committee" means the committee constitutedby RIL's Board in accordance with the provisions of Section 178 of the Companies Act 2013and Regulation 19 of the Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 ("Listing Regulations").
4.1 Remuneration to Executive Directors and Key Managerial Personnel
4.1.1 The Board on the recommendation of the Human Resources Nomination andRemuneration (HRNR) Committee shall review and approve the remuneration payable to theExecutive Directors of the Company within the overall limits approved by the shareholders.
4.1.2 The Board on the recommendation of the HRNR Committee shall also review andapprove the remuneration payable to the Key Managerial Personnel of the Company.
4.1.3 The remuneration structure to the Executive Directors and Key ManagerialPersonnel shall include the following components: (i) Basic Pay (ii) Perquisites andAllowances (iii) Stock Options (iv) Commission (Applicable in case of Executive Directors)(v) Retiral benefits (vi) Annual Performance Bonus
4.1.4 The Annual Plan and Objectives for Executive Directors and Senior Executives(Executive Committee) shall be reviewed by the HRNR Committee and Annual Performance Bonuswill be approved by the Committee based on the achievements against the Annual Plan andObjectives.
4.2 Remuneration to Non-Executive Directors
4.2.1 The Board on the recommendation of the HRNR Committee shall review and approvethe remuneration payable to the Non-Executive Directors of the Company within the overalllimits approved by the shareholders.
4.2.2 Non-Executive Directors shall be entitled to sitting fees for attending themeetings of the Board and the Committees thereof. The Non-Executive Directors shall alsobe entitled to profit related commission in addition to the sitting fees.
4.3 Remuneration to other employees
4.3.1 Employees shall be assigned grades according to their qualifications and workexperience competencies as well as their roles and responsibilities in the organisation.Individual remuneration shall be determined within the appropriate grade and shall bebased on various factors such as job profile skill sets seniority experience andprevailing remuneration levels for equivalent jobs.
|For and on behalf of Board of Directors |
|Mukesh D. Ambani |
|Chairman and Managing Director |
|Mumbai April 24 2017 |
PARTICULARS OF ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGSAND OUTGO REQUIRED UNDER THE COMPANIES ACCOUNTS RULES 2014
A. CONSERVATION OF ENERGY
I STEPS TAKEN FOR CONSERVATION OF ENERGY
Energy security has always been one of the key components of RIL's business strategyand also one of the biggest challenges encountered globally. With the commissioning ofcoal based power plants at Dahej and Hazira in FY 2016-17 the Company is now betterequipped to benefit from volatile fuel prices and optimise energy cost.
The Company's systems and processes ensure optimum energy usage by continuousmonitoring of all forms of energy and increasing the efficiency of operations.
On the energy conservation front the Company continues its thrust on improving energyefficiency through adoption of new technology and optimisation of operation therebyreducing energy cost. The Company spent Rs. 222.83 crore as capital investment towardsprocurement and installation of energy efficient equipment.
A dedicated Energy Cell' both at the site and group levels is focusing onenergy management and closely monitors energy consumption pattern across all manufacturingsites. Periodic energy audits are conducted to improve energy performance and benchmarkwith other international refineries and petrochemical sites.
Major energy conservation and initiatives taken during the FY 2016-17
Refining & Marketing
Jamnagar manufacturing division (DTA)
Installation of heat recovery system from ue gasses to preheat combustion air for threeheaters in Coker plant and increase heater efficiency.
Increased heat recovery from Naphtha Splitter (NS) bottom stream to High PressureBoiler Feed Water (HP-BFW) and reduce Medium Pressure (MP) steam consumption.
Installation of new ue gas cooler in Fluid Catalytic Cracker Unit (FCCU) resulting inadditional steam generation. Reduction of power recovery train wind-milling steam with lowpressure steam line modification.
Increased heat recovery from Clarified Slurry Oil (CSO) and Light Cycle Oil (LCO)streams to preheat cold feed and boiler feed water by modifying heat exchanger network inFCCU.
Increased heat recovery from Hydrogen plant to preheat Boiler Feed Water.
Naphtha Splitter column is refurbished with divided wall column technology to reduceenergy consumption in distillation.
Routing propylene from Propylene Recovery unit (PRU) directly to Polypropylene (PP)unit and reduce pumping power consumption.
Medium Pressure Boiler Feed Water (MP-BFW) preheating by heat recovery from byOrtho-Xylene product.
Jamnagar manufacturing division (SEZ)
Installation of heat exchanger to increase medium pressure steam generation in DieselHydro Desulfurisation unit. Increased heat recovery from Clarified Slurry Oil (CSO) andLight Cycle Oil (LCO) streams to preheat cold feed and boiler feed water by modifying heatexchanger network in FCCU and reducing steam consumption.
Refurbishment of the Platformer heater in Heavy Naphtha Union ning Unit (HNUU)resulting in increased heat recovery from ue gasses.
Hazira manufacturing division
Combustion and air optimisation in cracker furnaces by reducing lower speed limit ofthe Induced Draft (ID) fan resulting in fuel gas consumption reduction.
Refflux flow optimisation and pressure reduction in Benzene Column resulted in MediumPressure (MP) steam consumption reduction in Aromatics plant.
Installation of new pressure control system in benzene tower for reduction of mediumpressure steam in aromatics plant. Stoppage of cooling tower fan in butane plant resultedin power consumption reduction.
Installation of Advanced Process Control (APC) in butane-1 plant resulted in reducedsteam consumption.
Refflux optimisation in Para Di-ethyl benzene plant resulted in High Pressure (HP)steam consumption reduction in Aromatics plant.
Reduction in Low Pressure (LP) steam consumption by increasing heat recovery viaSolvent Exchanger in Butadiene plant.
Installation of additional LP steam pipelines to increase Steam export from PuriffedTerephthalic Acid plant (PTA). Installation of ash vessel to generate IntermediatePressure (IP) steam from High Pressure (HP) condensate. Installation of high efficiencyair preheater for hot-oil vaporiser resulting in reduction of fuel gas consumption inPoly-Ethylene (PE) Plant.
Provision of soft switch in Styrene Butadiene Rubber (SBR) unit for operating dryerconveyor during cleaning resulting in power consumption reduction.
Reduction in diameter of Vinyl Chloride Monomer (VCM) hi-boil column bottom-up pumpimpeller resulted in power reduction.
Impeller replacement and corrosion proof coating in cooling tower pumps resulted inefficiency improvement and reduction in power consumption.
Effluent recycle from Demineralisation plant to
Demineralisation Reverse osmosis resulted in reduction of lter water consumption.
Replacement of DH Column Fin Fan condenser blades with high efficiency fans to reducepower consumption.
Vadodara manufacturing division
Drying column feed preheating with column bottom product resulted in steam consumptionreduction. Control system modification in deaerator of Gas Turbine Power Plant (GTPP) toincrease heat recovery from Poly-Butadiene Rubber (PBR) plant and reduce steamconsumption.
Dahej manufacturing division
Installation of Hydraulic Power Recovery Turbine (HPRT) to generate electrical powerfrom hydraulic pressure reduction.
Interconnected High Pressure (HP) and Low Pressure (LP) air headers to reduce airventing and to stop one air compressor.
Power consumption reduction by stoppage of one amine booster pump in Ethylene PropyleneRecovery Unit (EPRU) Refurbishment of condensate stripper in Gas Cracker Unit (GCU) forreduced steam and power consumption.
Installation of closed loop condensate system at GCU for increased recovery ofcondensate.
Nagothane manufacturing division
Low pressure condensate recovery in the Gas Cracker (GC) Optimisation of the main steamheader pressure at Captive Power Plant (CPP).
Installed a small air compressor and switched-off of a bigger compressor to avoidventing and reduce power consumption.
Stoppage of nitrogen compressor in Air Separation Plant through improved Nitrogen stockManagement to reduce power consumption.
Patalganga manufacturing division
Refurbishment of Air Pre-Heater (APH) of the back end heaters in Linear Alkyl Benzene(LAB) plant to reduce fuel consumption.
Replacement of burner tips with new energy efficient ones in stripper reboiler furnaceof Para-Xylene (PX) plant and increase furnace efficiency.
Replacement of internal packings of para n column in Linear Alkyl Benzene plant andreduce energy consumption in the distillation column reboiler.
Other initiatives taken at various manufacturing divisions
Replacement of old motors with Energy efficient motors in Barabanki and HoshiarpurManufacturing Divisions. Replacement of Fluorescent tube lights with LED lights inBarabanki and Naroda Manufacturing Divisions.
Installations of an Energy efficient boiler and air compressor to replace old ones forsaving energy at Naroda Manufacturing Division.
II STEPS TAKEN BY THE COMPANY FOR UTILISING ALTERNATE SOURCES OF ENERGY
Rooftop solar photo voltaic projects are being installed across RIL manufacturingunits.
Innovative applications of renewable energy such as solar thermal integration withmanufacturing processes biomass co-ring etc are being evaluated.
Biogas generation facilities being installed at various sites to process organic waste.
III THE CAPITAL INVESTMENT ON ENERGY CONSERVATION EQUIPMENT
|Sr. No. ||Manufacturing Division ||Capital investments on energy efficient equipment's (Rs.Crores) ||Energy savings (Gcal/hr) ||Financial saving (Rs. In crore per Annum) |
|(I) || || || || |
|1 ||Jamnagar manufacturing division (DTA) ||126.5 ||34.58 ||62.64 |
|2 ||Jamnagar manufacturing division (SEZ) ||15.35 ||45.9 ||83.16 |
|(II) || || || || |
|3 ||Hazira manufacturing division ||5.64 ||12.41 ||20.20 |
|4 ||Vadodara manufacturing division ||64.67 ||6.27 ||11.38 |
|5 ||Dahej manufacturing division ||6.08 ||4.26 ||8.69 |
|6 ||Nagothane manufacturing division ||0.07 ||10.71 ||18.57 |
|7 ||Patalganga manufacturing division ||1.33 ||2.43 ||4.83 |
|8 ||Other manufacturing divisions ||3.19 ||58.29 ||2.93 |
B. TECHNOLOGY ABSORPTION
Research and technology at RIL helps create superior value by harnessing internalresearch and development skills and competencies and creates innovations in emergingtechnology domains related to RIL's various businesses. Research and technology atReliance focuses on (i) new products processes and catalyst development to supportexisting businesses and create breakthrough technologies for new businesses (ii) advancedtroubleshooting and (iii) support to capital projects and profit and reliabilityimprovements in manufacturing plants.
1 MAJOR EFFORTS MADE TOWARDS TECHNOLOGY ABSORPTION
Refining & Marketing
Profitable disposal of gasiffer slag and value creation by extraction of nickel andvanadium from slag. Multi-functional sulfur soil nutrient for enhancing crop quality andyield as sodic soil amendment.
Development of low cost Carbon dioxide adsorbent and capture process.
Development of the process for direct synthesis of dimethyl carbonate from Carbondioxide.
Benzene extraction process from ole nic uidised catalytic cracking (FCC) gasoline.
Development of high active FCC catalyst. Production of nPnO linear alkyl benzene (LAB)feedstock from Light Coker Gas Oil (LCGO) at Jamnagar.
Demo unit to demonstrate multi zone catalytic cracking process (MCC).
Removal of oxygenates and Carbon di-sulphide (CS2) from petrochemical naphtha.
Development of Zeolite Socony Mobil5 (ZSM-5) additive (RMP-5) to improvepropylene yield in the FCC.
Accelerated deactivation protocol for Vacuum gas oil Hydro treating unit (VGOHT)catalyst.
Fast characterisation of crude using Near-infrared (NIR) to provide assay updatesupport.
In-house corrosion model developed to estimate true corrosivity of crude to optimisecrude purchases. In-house RIL platformer model developed and is being used to maximisevalue of C5-C12 pool.
Development of in-house RIL model for VGOHT is started.
Development of a Reliance proprietary process to manufacture Chlorinated PolyvinylChloride (CPVC) resin. Development of Reliance proprietary catalyst for reformingdehydrogenation of hydrocarbons.
Development of novel speciality materials like self-healing elastomers for extendedlife of a tire. Development of high strength fibre and lm for ballistic armours.
Development of a Reliance proprietary catalyst and process to replace Hydroffuoric Acid(HF) in the manufacture of Linear Alkyl Benzene (LAB) for use in detergents.
Puriffcation of crude terephthalic acid using ionic liquids based technology tosignificantly reduce operations and capital cost.
Novel processes for production of polymer monomers such 1-hexene butadiene.
Homo grade polypropylene development through Reliance proprietary catalyst system forbetter operational reliability and higher performance of products.
HDPE process and product quality enhancement for bimodal HDPE.
Modiffcations in styrene butadiene rubber process improvement and product qualityenhancement. Novel halo butyl process development and next generation products for nicheapplications. Hybrid sulfur polymers development for construction and coating sectors.
Biodegradable polyalyl carbonates polymerisation using carbon dioxide as raw material.
Novel polypropylene product development ranging from medium to high molecular weightfor niche applications.
Metallocene polyethylene (PE) products and process development for packagingapplications.
Self-adhesive material development for health sector. Self-healing halo butyl rubberdevelopment.
Successful development and commercialisation of opaque polyethylene terephthalate (PET)resin mainly for specialty milk products and ultra-high temperature milk packagingapplications.
Successful development of Extrusion Blow Moulding (EBM) grade of PET.
Successful development and commercialisation of low antimony PET for fibreapplications.
Design development and installation of manufacturing facility for eco-friendlypolyester polymerisation catalyst at Hazira. The catalyst required is manufactured forin-house consumption.
Development of sparkle polyesterfibre for fancy yarn and development of ne denierhollowfibre for winter wear.
Polyesterfibre developed for Acquisition Distribution Layer (ADL) application.
Development of specialty polyesterfibre for asbestos replacement.
Development of RecoSilk polyesterfibre and lament for low temperature dyeing forhandloom sector. Development of polymerisation reactor models and their utilisation inpolyester plants for process optimisation / troubleshooting.
Biofuels and Bio-Chemicals
Development of Green Bio crude' from algae using sea water sunlight and low costnutrients.
Development of high yielding biofuel hybrid crops. Development of high yielding wasteland based non- edible crops for large scale cultivation for production ofbiofuels/chemicals.
In-house research and external technology for converting abundantly availablecellulosic biomass in India to fuels and chemicals.
Application of biotechnology to enhance the productivity of biofuels species.
Testing the best hybrids produced by us and others at different agro-climatic zones toidentify most productive cultivators.
Popularising the cultivation of bio-fuel crops by growers by conducting method andvarietal demonstrations. Genetic modifications synthetic biology high throughputscreening and metabolic ux analysis for biomolecule production.
Developed a web portal (algorithm) for predicting genes for improving industrial traitsfor biofuel production.
Other R&D Activities
Development of indigenous Polymer Electrolyte Membrane (PEM) fuel cell technology.
Work is underway to develop a technology to produce methane from unminable undergroundcoal reserves. If the technology is successful it will help increase production ofcoal-bed methane.
One step process for production of Carbon Nano Tubes (CNT) for non-woven mats (NWM)composites andfibre.
Advance Process Control (APC)/ Real Time
Optimisation (RTO) implementation in all our major manufacturing facilities.
Modelling and simulation scale up support and advance trouble shooting.
Development and use of online soft sensor for I.V. measurement in SSP reactor.
2. THE BENEFITS DERIVED LIKE PRODUCT IMPROVEMENT COST REDUCTION PRODUCTDEVELOPMENT OR IMPORT SUBSTITUTION
The potential benefits derived from R&D and Technology absorption adoption andinnovation initiatives in FY 2016-17 is approximately Rs. 295 crore.
3. INFORMATION REGARDING IMPORTED TECHNOLOGY IMPORTED DURING LAST THREE YEARS
|Details of technology imported ||Technology import from ||Year of import ||Status implementation / absorption |
|AMT-ADP process for azeotropic distillation ||AMT USA ||2015-16 ||Design and construction under progress |
|Halogenated Isobutylene Isoprene Rubber (HIIR) JV with Sibur ||Yarsintez Russia ||2015-16 ||Basic engineering package is completed. |
|SSP and IDY Spinning ||Dalian China and TMT Japan ||2015-16 ||Plant under commissioning |
| || || || |
|Ethylene (Cracker) Ethane feed flexibility project ||Technip Houston ||2014-15 ||Engineering execution and start-up completed at Dahej. At Hazira and Nagothane engineering completed and construction close to completion. |
|Synthetic natural gas (SNG) ||Johnson Matthey UK ||2014-15 ||Plant under design and construction |
|Hydro treatment of extract ||Axens France ||2014-15 ||Plant under construction |
|Impact Reactor facility at JMD DTA PP line B ||WR Grace ||2014-15 ||Plant construction nearing completion |
4.EXPENDITURE INCURRED ON RESEARCH AND DEVELOPMENT
|Sr. No. ||Particulars ||in crore |
|a) ||Capital ||593 |
|b) ||Revenue ||855 |
| ||Total ||1448 |
C. FOREIGN EXCHANGE EARNINGS AND OUTGO
I ACTIVITIES RELATING TO EXPORT INITIATIVES TO INCREASE EXPORTS DEVELOPMENTS OF NEWEXPORT MARKETS FOR PRODUCTS AND SERVICES AND EXPORT PLAN.
The Company has continued to maintain focus and avail of export opportunities based oneconomic considerations. During the year the Company has exports (FOB value) worth138856 crore (US$ 21.4 billion).
II TOTAL FOREIGN EXCHANGE EARNED AND USED
| ||in crore |
|Foreign Exchange earned in terms of actual inflows ||139131 |
|Foreign Exchange outgo in terms of actual outflows ||179949 |
Note: Actual inflows does not includes total savings in Foreign Exchange throughproducts manufactured by the Company and deemed exports amounting to 75568 crore (US$11.7 billion)