Reliance to raise 53,215 crore

The company said earnings were impacted by a one-time loss of 4,267 crore due to fall in fuel prices and demand destruction post covid-19. Revenue from operations for the March quarter declined 2.4% to 1.36 lakh crore.
RIL reported a consolidated profit of ₹6,348 crore in the quarter to March, a 39% decline from ₹10,362 crore a year ago. (Reuters File Photo)
RIL reported a consolidated profit of ₹6,348 crore in the quarter to March, a 39% decline from ₹10,362 crore a year ago. (Reuters File Photo)
Published on May 01, 2020 03:43 AM IST
Copy Link
Hindustan Times, Mumbai | BySwaraj Singh Dhanjal and Kalpana Pathak

Reliance Industries Ltd plans to raise 53,215 crore by selling shares to existing investors, the biggest such fundraising by a company in India, as the energy conglomerate aims to wipe off its massive debt.

Shareholders of Reliance will be offered one new share for every 15 held at 1,257 apiece, a discount of 14% to Thursday’s closing price of 1,467.05. It’s the first such share sale by India’s most valuable firm in three decades. The announcement of the record fundraising came after the company reported a sharp drop in quarterly profit because of a slump in fuel sales due to lockdowns around the world to stem the spread of the coronavirus. RIL reported a consolidated profit of 6,348 crore in the quarter to March, a 39% decline from 10,362 crore a year ago.

The company said earnings were impacted by a one-time loss of 4,267 crore due to fall in fuel prices and demand destruction post covid-19. Revenue from operations for the March quarter declined 2.4% to 1.36 lakh crore.

For the full year, RIL recorded a 0.1% rise in consolidated profit (after exceptional item) at 39,880 crore, against 39,837 crore in FY19. Revenue rose 5.4% to 659,205 crore in FY20. Gross refining margins (GRMs) in the March quarter were $8.9 per barrel, outperforming Singapore complex margins by $7.7 per barrel, the company said.

“Covid-19 is significantly impacting business operation of the companies, by way of interruption in production, supply chain disruption, unavailability of personnel, closure / lockdown of production facilities, etc. Further, during March 2020/April 2020, there has been significant volatility in oil prices, resulting in reduction in oil prices,” an RIL statement said. At 50% shareholding, Mukesh Ambani, Asia’s richest man, will have to pump in at least 26,600 crore to subscribe to his portion of the rights issue.

The firm also unveiled austerity measures, as a part of which Mukesh Ambani will forgo his annual salary, and directors, executive directors and senior leaders of the flagship oil and gas business will forgo 30-50% of their compensation, an internal note said. “Our employees in hydrocarbons with compensation in excess of 15 lakh per annum will have a 10% reduction in fixed pay,” Hital R Meswani, executive director and member of the RIL board said in the note.

SHARE THIS ARTICLE ON
Close Story
SHARE
Story Saved
×
Saved Articles
Following
My Reads
Sign out
New Delhi 0C
Thursday, January 20, 2022