Spurt in Reliance Industries sales

By Our Staff Correspondent

MUMBAI, JAN. 31. Reliance Industries has announced a net profit of Rs. 2,106 crores for the nine months ended December 31, 2000 against Rs. 1,749 crores in the corresponding period of last year. Sales have spurted to Rs. 21,564 crores from Rs. 13,707 crores. Other income amounted to Rs. 205 crores (Rs. 426 crores).

The company provided Rs. 925 crores (Rs. 699 crores) for interest and Rs. 1,018 crores (Rs. 705 crores) for depreciation. There is no provision for taxation as before. During the period, the production was up 24 per cent at 7.9 million tonnes and manufactured exports including deemed exports at Rs. 2,292 crores (Rs. 759 crores). During the nine month period, capital expenditure was Rs. 400 crores.

In polyester, the company has been ranked the second largest producer in the world and the largest in India with a market share of 52 per cent. Production volumes in the polyester business (PSF, PFY and PET) were up 16 per cent at 5.60 lakh tonnes. During the period, 63 per cent of PSF production and 19 per cent of PFY output represented speciality products, contributing a premium of 5-25 per cent over commodity prices.

In fibre intermediates (paraxylene, PTA and MEG), Reliance is among the top producers in the world. Production volumes during the period were up 45 per cent to 2.18 million tonnes reflecting the impact of commissioning of the 1.4 million tpa paraxylene facilities at the Jamnagar petrochemicals complex.

The company produced 5.54 lakh tonnes of ethylene and 2.64 lakh tonnes of propylene at its Hazira complex.

Reliance is the largest polymer (PP, PE and PVC) producer in India with a market share of 53 per cent. The polymers business reported a 30 per cent increase in production volumes to 1.2 million tonnes mainly due to the commissioning of the 6 lakh tpa PP capacity at Jamnagar.

In oil and gas, RIL holds a 30 per cent interest in an unincorporated joint venture with Enron and ONGC to develop the proven Panna, Mukta and Tapti (PMT) oil and gas fields. Enron's stake of 30 per cent is up for sale and Reliance is now weighing its options.

ONGC has the balance 40 per cent share. Oil and gas accounted for 3 per cent of RIL's revenues during the period under review.

During the period, RIL has, in a 90:10 consortium with Niko Resources of Canada, been awarded 12 new exploration blocks by the Government. These blocks cover a wide range of geological settings and together with the two blocks awarded to Reliance in earlier rounds of bidding, RIL now emerges the country's largest E&P (exploration and production) player in the private sector. Development work on the blocks is to commence shortly.

According to Mr. Anil Ambani, managing director, RIL will participate in the NELP II also and over the next five years, oil and gas will contribute between 10 and 20 per cent of the company's revenues. He added that the company would spend around $200 million over the next three years as developmental costs in these blocks and that gas production has the potential to increase three times.

For the quarter ended December 31, 2000, the company declared a net profit of Rs. 759 crores against Rs. 627 crores in the corresponding quarter last year on a sales of Rs. 6,555 crores (Rs. 5,034 crores). Other income amounted to Rs. 51 crores (Rs. 148 crores). The company provided Rs. 294 crores (Rs. 276 crores) for interest, Rs. 353 crores (Rs. 258 crores) for depreciation and nil (nil) for tax.

Commenting on the results, Mr. Ambani said, ``Record high levels of energy prices, leading to a steep increase in feedstock costs and simultaneous sharp declines in selling prices of most products, characterised the operating environment for the third quarter, placing unprecedented pressures on margins of petrochemical companies worldwide. Reliance has now reported higher quarter-on-quarter sales and profits for 43 consecutive quarters in a row, through several economic and business cycles.''

Mr. Ambani said Reliance Telecom's subscriber base had increased to 1.50 lakhs in 75 cities and the cellular operations are cash positive. Reliance Infocom, the lead company for undertaking/promoting all future telecom/infocom initiatives of the group, has filed for voice offerings in 11 circles. The fibre optic cable backbone is being laid in 13 States and the company hopes to complete this by end-2002. Services will be rolled out in a phased manner in each of the States. Mr. Ambani said a potential listing on the bourses would be considered in 2-3 years.

On Reliance's foray into insurance, Mr. Ambani said the company had secured the general insurance licences while that for life insurance is awaited.

Send this article to Friends by E-Mail

Section  : Business
Previous : Maran for 100 p.c. FDI in leather sector
Next     : Reliance Petro earns Rs. 1,167 cr. profit