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Reliance Industries Ltd.

BSE: 500325 Sector: Oil & Gas
NSE: RELIANCE ISIN Code: INE002A01018
BSE 00:00 | 20 Jan 2478.80 -42.60
(-1.69%)
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NSE 00:00 | 20 Jan 2477.45 -44.15
(-1.75%)
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OPEN 2497.00
PREVIOUS CLOSE 2521.40
VOLUME 202569
52-Week high 2750.00
52-Week low 1830.00
P/E 49.06
Mkt Cap.(Rs cr) 1,676,764
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 2497.00
CLOSE 2521.40
VOLUME 202569
52-Week high 2750.00
52-Week low 1830.00
P/E 49.06
Mkt Cap.(Rs cr) 1,676,764
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Reliance Industries Ltd. (RELIANCE) - Chairman Speech

Company chairman speech

Executing growth engines for India's future

Dear and Esteemed Fellow Shareowners

I have always started this letter by sharing with you the operationaland financial achievements of Reliance during the year. But the past year has been aparticularly challenging one for India and its people. The COVID-19 pandemic disruptedseveral lives and dealt a severe blow to the economic health of the nation. It has alsoput tremendous burden on the healthcare infrastructure of the nation which is crucial forsaving lives and reducing the impact of the pandemic. In these challenging times the mostremarkable and satisfying achievement of the company has been its humanitarian efforts instrengthening the nation's fight against the pandemic.

Right from day one Reliance has adopted a multi-pronged preventionmitigation adaptation and ongoing support strategy to fight the pandemic. Last year assoon as the first few cases of COVID-19 were reported in India Reliance Foundation (RF)set up India's

first dedicated COVID-19 hospital in Mumbai in just two weeks. Thisyear in response to the sudden surge in COVID-19 cases in the city RF rapidly scaled upits COVID operations to create 875-bed facilities dedicated to COVID care. It is thelargest contribution by a philanthropic organisation to COVID care in Mumbai. RF has alsoset up fully equipped 1000-bed COVID care facilities in Jamnagar. Overall Reliance issupporting the set-up and management of over 2300 beds across various locations.

Last year Reliance established a manufacturing unit in Silvassa tomass produce high quality PPE kits for the frontline warriors. It became the largestproducer of high-quality PPEs in India. This year in response to the urgent need formedical oxygen across the nation Reliance repurposed its plants in Jamnagar to producemedical-grade oxygen soon becoming the largest producer of medical-grade oxygen

from a single location in India. Since the beginning of the pandemicReliance has supplied over 55000 MT of medical grade liquid oxygen across the country. Ithas also taken several steps to boost India's capacity to swiftly and safely transportthis life-saving resource.

The Foundation also launched Mission Anna Seva a programme to providefree meals to marginalised communities and frontline warriors across the nation. So farRF has provided over 5.5 crore nutritious meals through ration kits food coupons andcooked meals across 18 states and one Union Territory. This is the single largest mealdistribution programme undertaken in the world by a corporate foundation.

In order to safeguard the health and well-being of our employees andtheir family members we have set up several initiatives such as a nationwide emergencyresponse infrastructure that is available 24x7. We have also created

the JioHealthHub app for free virtual video consultations with ourdoctors. Using the COVID-19 symptom checker we are tracking the health of our employeesand their family members. REFERS our emergency response service is constantly monitoringthe symptom tracker and reaching out to those showing the risk of being COVID- positive.In addition to this our teams of medical experts are helping employees preserve mentalhealth and emotional well-being through yoga and wellness sessions and psychologicalguidance.

A key initiative to safeguard employees from the pandemic isR-Surakshaa Reliance's own vaccination programme. Under R-Surakshaa Reliance hasinitiated a tech-enabled multi-location vaccination drive to vaccinate all employeespartners associates affiliates and their eligible family members for free. Thevaccination drive is fully compliant with government rules and regulations.

Also Reliance has put in place a liberal leave policy for employeesaffected by COVID-19. It is providing financial assistance of up to 3 months' pay asinterest-free salary advance in case of an exigency. In case of unfortunate demise of anemployee Reliance is providing financial support to the family and committing to shoulderthe educational expenses of the children.

While the war against COVID is far from over we the Reliance Familyare confident that in the end we will prevail. We care for each one of our stakeholdersincluding employees shareholders vendors customers and local communities.

I will now update you on your company's operating and financialperformance.

Despite unprecedented challenges we continued to execute on our growthplans across businesses. In our Retail business we expanded

our customer outreach by growing physical and digital footprint withstore additions strengthening of supply chain infrastructure and launch of JioMart. InDigital Services business we increased network capacity and spectrum footprint whilerapidly growing our customer base.

Our consumer businesses Reliance Jio and Reliance Retail have provedto be digital and physical lifelines of the nation in these challenging times.

Our O2C business demonstrated resilience to rapidly evolving businessenvironment. Agile business model superior product placement capabilities and highutilisation rates while ensuring safe and reliable operations helped achieve industryleading performance.

Financial Performance and Balance Sheet

In a volatile environment Reliance generated an EBITDA of '97580crore (US$13.3 billion) which is 4.6% lower than last year. Diversified earnings streamand resilient consumer businesses helped the company navigate through the unprecedentedpandemic headwinds. Reliance recorded a consolidated net profit of '53739 crore (US$7.4billion) during the year registering a growth of 34.8% y-o-y.

; Our consumer businesses retained their leadership positions andrecorded robust growth on all operating and financial parameters during the year in spiteof challenging hurdles. They now constitute nearly 50% of consolidated segment EBITDAcompared to 36% in FY 2019-20.

We executed the largest ever capital raise in India of '260074 crore(US$36 billion) through rights issue and asset monetisation. The fund raised along withcapital commitments exceeded net debt levels helping your company achieve a Net DebtFree balance sheet ahead of the stated timeline of March 2021.

We successfully completed India's largest ever Rights Issue of '53124crore (oversubscribed by 1.59 times) which is also the largest in the world by aNon-Financial Institution in the last 10 years.

During the year Jio Platforms and Reliance Retail raised '152056crore and '47265 crore respectively from strategic and financial investors includingFacebook and Google. bp invested '7629 crore for a 49% stake in our fuel retailingbusiness.

Strong operating cash flow and largest ever capital raise furtherstrengthened our balance sheet enabling us to deleverage and meet our net-debt zerocommitment ahead of stated timeline.

During the year RIL made pre-payment of US$7.8 billion of long-termforeign currency debt with requisite approvals from the RBI. This is the highest everpre-payment of debt undertaken by any corporate borrower in India.

We now have a strong balance-sheet with high liquidity that willsupport growth plans for our three hyper-growth engines - Jio Retail and O2C.

I The business delivered a healthy performance with record profitdelivery in an operating environment that continued to remain challenging. During theyear the business was impacted by restrictions with 80% stores operational and lowerfootfalls which were at 65% of last year.

Reliance Retail fulfilled its commitment to serve customers at scale byproviding grocery and essential supplies to millions of Indians at their doorstepovercoming enormous constraints during the lockdown.

Reliance Retail opened 1456 new stores taking the total store count toover 12700 stores across the country. Our Retail business operations ensured support forthe entire retail ecosystem including consumers farmers merchants small andmedium-scale manufacturers and supply-chain service providers. The business generated>65000 new jobs providing vital support to the community.

Reliance Retail's New Commerce initiative JioMart continues to growin scale with more traffic active users and orders. Rapid scale-up of digital commercesolutions including JioMart compensated for curtailed store operations and lowerfootfalls. Digital commerce channel Ajio.com witnessed 3x increase in business on higherorders and improvement across all key operating metrics.

I During FY 2020-21 Jio led

subscriber growth in the country with gross addition of 99 millionsubscribers. Jio became the first operator outside China to achieve 400 millionsubscribers in a single-country market.

With its next generation all-IP data network Jio continued torevolutionise digital adoption in India at an unprecedented rate.

Jio's high-speed connectivity services enabled millions of Indians towork from home study from home shop from home. It also enabled delivery of food andwellness at home medical consultation at home and above all kept families connectedthrough the pandemic. Higher acceptance of digital services reflects in 27% y-o-y growthin Jio's total data traffic to 1668 crore GB in 4Q FY 2021.

Jio Platforms is building a massive digital ecosystem for a billionIndians by providing world-class connectivity and digital solutions across businessverticals and customer lifecycle. Jio launched and scaled-up multiple digital platformslike JioMart JioMeet JioHaptik and JioUPI during the year. Jio's impact on internetusage in India has been recognised by Brand Finance who recognised Jio as the 5thstrongest brand globally terming its impact on the market as the 'Jio Effect'.

We are also excited with the development of a new generation cloudnative 5G RAN technology that is truly open and software defined. Qualcomm and Jiosuccessfully tested 5G solutions in India achieving the 1 Gbps milestone on Jio 5Gsolution.

Jio's innovation has spearheaded the transformation of India into oneof the world's largest consumers of mobile broadband service.

Market environment during the first half of the year witnessed a highlyvolatile crude and feedstock price environment.

Demand destruction in the first half resulted in sharpest global oildemand contraction in decades with a decline of 9.5 mb/d to ~90.5 mb/d in CY 2020. Travelrestrictions significantly impacted the global demand for transportation fuels. Fordownstream products demand destruction in automotive housing & constructionconsumer durables were partially offset by heightened demand from health & hygienepackaging and e-commerce.

Business environment for O2C segment improved sharply in the secondhalf of the year with gradual easing of lockdowns and revival in economic activitiesresulting in demand recovery to near pre-COVID levels by the end of the year. Marginenvironment also improved in the second half of the year with rising demand and supplydisruptions.

Agile business operations through the COVID-19 crisis enabled Relianceto operate its O2C facilities at near 100% by shifting products to export markets. Highoperating levels helped Reliance meet commitments to suppliers vendors and consumersensuring continuity of operations for the entire ecosystem.

Recently we initiated process of reorganising our O2C business into aseparate subsidiary. The reorganisation will facilitate value creation through strategicpartnerships and attract dedicated pool of investor capital. O2C's goal is to maximisecrude to chemicals conversion and create a sustainable growth business. The schemereceived an overwhelming support from our shareholders and creditors.

Despite extraordinary constraints during the period Reliancesuccessfully commissioned R Cluster field in KG D6 Block.

Located at a water depth of greater than 2000 meters R Cluster isAsia's deepest and India's first ultradeepwater gas field.

This was followed by commissioning of Satellite Fields in April 2021which was done ahead of schedule. It showcases your company's commitment towards India'stransition into a cleaner and greener gas-based economy.

These complex deepwater projects have been executed in over 34countries and at peak more than 4000 people have been working offshore and onshore.Additionally the pandemic constrained movement of people and material across the globe.Despite these odds the projects had flawless and safe commissioning.

R Cluster and Satellite Fields are two of the three new developments inthe KG D6 block the other being MJ fields which together are expected to meet ~15% ofIndia's gas demand by 2023 and account for ~25% of domestic production. Peak gasproduction from the three fields is expected to be ~1 bcf/ day by 2023. It will helpreduce India's dependence on imported gas.

Sustainability

Our philosophy of inclusive growth is depicted in the way we conductour businesses. Growth and development are often defined conventionally in terms of netprofit revenue and other financial performance. While we realise that all these areimportant our mission remains to continue growing as a responsible organisation thatbelieves in enriching lives.

We continue undertaking social initiatives in the areas of EducationHealthcare Community Infrastructure Skill Enhancement and Social Security.

The growing demand for energy is causing an imbalance in limitedresources especially in developing and emerging countries like India. We are committed todevelop and grow in a responsible manner while meeting the expectations of all ourstakeholders.

We believe that business priorities co-exist with social commitmentsand our activities support inclusive growth. While we work towards achieving our goals wesee the need to meet the society's evolving expectations. And therein lies the need toform enriching partnerships that will help us create a sustainable future.

The world is now closing ranks for a strong global action on ClimateChange. This gives Reliance the right opportunity to accelerate our own ambitious NewEnergy and New Materials business wedded to the vision of clean and green development. Tocombat climate change Reliance has set itself a target to become Net Carbon Zero by 2035.This is part of a wider ambition to achieve best-in-class standards across environmentalsocial and governance

parameters under the oversight of our Board. Our vibrant Board consistsof independent thought leaders with requisite skill sets and domain expertise to guide ourbusinesses on their future growth path.

Conclusion

As we passionately strive for a better future we continue to set newparadigms every single day. In an unpredictable and challenging environment agility andinnovation are key to staying consistently successf ul. As technology becomes a drivingforce in all businesses and facets of life the future belongs to organisations that canlead and leverage the digital revolution.

I would like to place on record my sincere appreciation to the Board ofDirectors for their guidance. I would also like to express my gratitude to all ourstakeholders for their unwavering faith in Reliance. And I would like to thank the entireteam at Reliance for their untiring efforts and unflinching commitment to achieve thelofty goals we have set ourselves for our Golden Decade.

I also want to express my deepest gratitude to scientists doctorsnurses police volunteers and many others who are waging the battle against COVID-19. Weall owe a great deal to them. I am confident that we are going to ultimately win the fightagainst COVID-19.

Because each one of us is engaged in this fight and the human spirit tofight and survive is greater than any disease or pandemic. With our collective effortIndia will eventually triumph over the crisis and emerge stronger bigger and better thanever.

With best wishes

Sincerely

Mukesh D. Ambani
Chairman and Managing Director
May 27 2021

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