July 19, 2019

Reliance
Industries Limited
BSE Limited National Stock Exchange of India Limited
Phiroze Jeejeebhoy Towers, Exchange Plaza, Plot No. C/1, G Block,
Dalal Street, Bandra-Kurla Complex, Sandra (East),
Mumbai 400 001 Mumbai 400 051
Scrip Code: 500325 Trading Symbol: RELIANCE

Dear Sirs,

Sub: "Annual General Meeting" of the members of the Company, "Record Date" and
Dividend payment I Warrant despatch date

This is to inform that the Forty-second Annual General Meeting (Post - IPO) of the members
of the Company will be held on Monday, August 12, 2019 at 11 :00 a.m. at Birla Matushri
Sabhagar, 19, Sir Vithaldas Thackersey Marg, Near Bombay Hospital & Medical Research
Centre, New Marine Lines, Mumbai 400 020 ("Annual General Meeting").

The Integrated Annual Report for the financial year 2018-19, including the Notice convening
the Annual General Meeting, is attached.

The Company will provide to its members the facility to cast their vote(s) on all resolutions set
out in the Notice by electronic means ("e-voting"). The e-voting communication giving
instructions fore-voting, being sent along with the Integrated Annual Report, is also attached.

The Company has fixed Monday, August 5, 2019 as the "Record Date" for the purpose of:
(a) determining the members eligible to receive dividend for the financial year 2018-19 and
(b) determining the members eligible to vote on all resolutions set out in the Notice.

The dividend, if declared at the Annual General Meeting, will be paid or warrants thereof
despatched within a week from the conclusion of the Annual General Meeting.

Thanking you,

Yours faithfully,
For Reliance Industries Limited

\~
K. Sethuraman
~ roup Company Secretary & Chief Compliance Officer
~ Encl.: As above

Copy to:
The Luxembourg Stock Exchange Singapore Stock Exchange Taipei Stock Exchange
Societe de Ia Bourse de Luxembourg 2 Shenton Way, 15F, No.100, Sec. 2,
35A Boulevard, Joseph II #19- 00 SGX Centre 1, Roosevelt Road,
B P 165, L-2011 Luxembourg Singapore 068804 Taipei, Taiwan, 10084
National Securities Depository Ltd. Central Depository The Bank of New York
Trade World, A Wing, 4th & 5th Floors, Services (India) Limited Mellon
Kamala Mills Compound, Marathon Futurex, A-Wing, 101 Barclay Street
Lower Parel, Mumbai - 13 25th Floor, NM Joshi Marg, New York, NY 10286
Lower Parel, Mumbai - 13
Karvy Fintech Private Limited
Karvy Selenium Tower B, Plot 31-
32,~~efiruli!\Cri:aL.tbtiiiltfim,,grd Floor, 222, Nariman Point, Post Box: 11717, Mumbai- 400 021. India.
Nanakram~ll~ole'lzbast soa~ Telefax: +91-22-2204 2268, 2285 2214. Website: www.ril.com
CIN: L17110MH1973PLC019786
“For those who dare to dream,
there is a whole world to win.”
Shri Dhirubhai H. Ambani
Founder Chairman

Connecting everyone.
Connecting everywhere.
Connecting everything.
The Jio Revolution.
The Reliance motto of 'Growth is Life' is a In a little over three years, Jio has customer touchpoints. Jio is being delivered
timeless expression of intent for Reliance, transformed the way India looks at as a stable, scalable and sustainable platform
even as we enter the fifth decade of our communication. Jio has ushered in a new on which the dreams and aspirations of
operations. Our belief in a connected future digital era, in which everyone, everywhere #NewIndia can be realised. Our large-
and shared value creation is unflinching has equal access to high-speed data, and scale investments in digital infrastructure
and absolute. It is reflected in the way we a bouquet of connected services that are empowers our network and provides citizens
think about our business, our people and meant to simplify lives, increase efficiency uninterrupted access to a wide repertoire of
our country. Our robust business portfolio and productivity, and make information services and conveniences. The introduction
ranging from energy to materials, retail to available at the fingertips of over a billion of our ‘connected living’ concept will see
digital services and entertainment touch people. everyone, being connected everywhere,
and transform in many different ways; to virtually everything. We are helping
The Jio Revolution has truly democratised
and our evolution mirrors the relentless transform the #InternetOfThings into the
digitalisation in India, helping India become
progress that our country has made over #InternetOfLife.
the largest consumer of mobile data
the years and the spirit of dynamism and
worldwide. Throughout this Integrated Annual Report,
hope that it brings to the world. The launch
we have tried to demonstrate how Reliance's
of digital services under the Jio brand At Reliance, we envision digital as an
businesses function and create value, and
is perhaps the strongest validation of all-encompassing, game-changing
how they further our founder's dream and
this spirit. paradigm that can positively impact
mission, in a quest to contribute to the
the lives of millions with applications
unstoppable growth of India and to make the
across business models, value chains and
lives of over a billion people better.

ABOUT THIS REPORT

The Reliance Integrated Annual Report has been prepared in alignment with the <IR> Framework laid down by the International Integrated Reporting Council. In
preparing the Report, GRI Standards, National Voluntary Guidelines (NVGs), United Nations Sustainable Development Goals (UN SDGs) and 13 other frameworks
were referenced and respected. The report outlines RIL's commitment to stakeholder value creation, and defines the actions taken and outcomes achieved for its
stakeholders.

Scan the QR Code on your Other reports and information at www.ril.com

smart device to view the • Corporate sustainability related information
Integrated Annual Report online at http://www.ril.com/Sustainability/CorporateSustainability.aspx
https://www.ril.com/ar2018-19/index.html • Quarterly results and analyst presentations
http://www.ril.com/InvestorRelations/FinancialReporting.aspx
• Financial statements of subsidiary companies
http://www.ril.com//InvestorRelations/Downloads.aspx
 HIGHLIGHTS FY 2018-19

₹6,22,809 crore ₹39,588 crore ₹8,63,996 crore

Consolidated Turnover Consolidated Profit After Tax Market Capitalisation
44.6% 13.1% 54.5%
y-o-y growth y-o-y growth y-o-y growth

INSIDE THIS REPORT

CORPORATE OVERVIEW MANAGEMENT REVIEW Consolidated
335 Independent Auditors’ Report on
2 Reliance at a Glance 48 Management’s Discussion and
Consolidated Financial Statements
4 Key Performance Indicators Analysis
346 Consolidated Balance Sheet
6 Letter to Shareholders 170 Report on Corporate Social
347 Consolidated Statement
10 Board of Directors Responsibility
of Profit and Loss
12 Theme Introduction
348 Consolidated Statement of Changes
14 Business Model:
GOVERNANCE in Equity
Integrated Reporting
350 Consolidated Cash Flow Statement
16 Refining and Marketing 184 Business Responsibility Report
352 Notes to the Consolidated Financial
20 Petrochemicals 204 Independent Reasonable Assurance
Statements
24 Oil and Gas Exploration & Production on Sustainability Disclosures
433 Salient Features of Financial
26 Retail 206 Corporate Governance Report
Statements of Subsidiary/Associates/
30 Digital Services 238 Board's Report
Joint Ventures
34 Media and Entertainment
36 Reliance Foundation
38 Reliance in Our Lives FINANCIAL STATEMENTS SHAREHOLDER INFORMATION
40 Awards and Accolades
Standalone 440 Notice of Annual General Meeting
43 Company Information
259 Independent Auditors’ Report on • Attendance Slip and Proxy Form
44 Product Flow Chart
Financial Statements • Members’ Feedback Form 2018-19
46 Financial Highlights
268 Balance Sheet
269 Statement of Profit and Loss
270 Statement of Changes in Equity
272 Cash Flow Statement
274 Notes to the Financial Statements

Connecting everyone. Connecting everywhere. Connecting everything.

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution.

RELIANCE AT A GLANCE
Realising India’s aspirations
RIL is India’s largest and most profitable private sector company. RIL continued to be a significant global player in the integrated energy
value chain while establishing leadership positions in the retail and digital services business in India. RIL is now focussed on building
platforms across its industry-leading businesses that will herald the Fourth Industrial Revolution and will create opportunities for the
nation to realise its true potential.

BUSINESS VERTICALS
REFINING AND The robust operational performance, superior configuration and
MARKETING consistent high utilisation of refineries at Jamnagar complex have
helped RIL outperform the Singapore refining benchmark.

₹3,93,988 cr 68.3 MMT

₹19,868 cr Crude throughput PAGE 16

PETROCHEMICALS Owns and operates one of the most integrated petrochemicals

facilities globally, with a portfolio comprising polymers, polyesters,
fibre intermediates, aromatics and elastomers.
₹1,72,065 cr 37.7 MMT
₹32,173 cr Highest ever Petchem production
PAGE 20

OIL AND GAS (E&P) Upstream portfolio in India includes operations in conventional
deepwater acreages and the unconventional Coal Bed Methane
(CBM) block.

₹5,005 cr 58.9 BCFe

₹(1,379) cr RIL’s share of domestic production PAGE 24

RETAIL India’s largest retailer by reach, scale, revenue and profitability.

Established presence across key consumption baskets and
holds a leadership position in food, consumer electronics and
fashion retailing.
₹1,30,566 cr
₹5,546 cr 6th fastest growing retail company in the world* PAGE 26

DIGITAL SERVICES Jio has built a world-class all-IP data, strong future-proof network
with the latest 4G LTE technology. It is the only greenfield all-IP
network supporting Voice over LTE (VoLTE) technology.

₹46,506 cr Ranked #1
₹8,784 cr in the country by Adjusted Gross Revenue (AGR)
PAGE 30

MEDIA AND Network18 is a media and entertainment powerhouse with its

ENTERTAINMENT foothold in television, filmed entertainment, digital business,
magazines, mobile content and allied businesses.

₹5,116 cr 800+ million PAGE 34

₹(52) cr people in India reached by Network18 TV channels
*Source: Global Powers of Retailing 2019, Deloitte
Revenue EBIT
2 Reliance Industries Limited  |  Integrated Annual Report 2018–19
 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

By combining economic success with environmental protec­tion and social responsibility, RIL is committed to delivering sustainable
growth and creating value for the nation through its products and services that enhance the quality of life for everyone, everywhere.

SUSTAINABILITY AT THE CORE VALUE DRIVERS FOR RIL

ENVIRONMENT INNOVATION AND R&D

2.1+ crore 120 900+
Saplings planted till date Patent applications granted Researchers and
during the year scientists
7.32+ crore m3
Rainwater harvesting capacity
PAGE 112
created since inception

PEOPLE SCALE AND TECHNOLOGY

1,94,056 World’s largest refinery at a single location
Direct employment Among the top 10 producers for key petrochemicals
India’s largest mobile data network
50+ lakh First retailer in India to cross the ₹1,00,000 crore turnover milestone
Indirect employment PAGE 120

CORPORATE SOCIAL PLATFORMS

RESPONSIBILITY
Software as a Service (SaaS) based platforms
₹904 crore Enterprise data lake
CSR expenditure during the year
Analytics and data science engines
26 million Enterprise integration capabilities
Lives touched across 18,000+ PAGE 170
villages and 200+ urban
locations since inception

VALUE ADDED (CONSOLIDATED)

Value added is defined as the value created by the activities of a business and its employees.
FY 2018-19 FY 2017-18

₹2,18,163 crore ₹1,68,110 crore

Stakeholders
(₹ in crore) Reinvested in the Group to (₹ in crore)
56,919 maintain and develop operations 49,233
Providers of Debt
27,749 18,087
Employee Benefits
12,488 9,523
Providers of Equity Capital 3,554
3,852*
Contribution to Society
904 771
Contribution to National Exchequer
1,16,251 86,942

* Dividend recommended for FY 2018-19 is `4,641 crore, including `789 crore as dividend distribution tax

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 3

KEY PERFORMANCE INDICATORS
Creating consistent value for all

PROFIT AND LOSS METRICS Consolidated BALANCE SHEET METRICS Consolidated

TURNOVER (₹ in crore) NET WORTH (₹ in crore)

₹6,22,809 crore 44.6% y-o-y ₹3,24,644 crore 12.0% y-o-y

CAGR
2018-19 6,22,809 31-03-2019 3,24,644 29.0%*

2017-18 4,30,731 31-03-2018 2,89,798

2016-17 3,30,180 31-03-2017 2,58,511
2015-16 2,93,298 31-03-2016 2,31,556
2014-15 3,88,494 31-03-2015 2,18,482

PROFIT AFTER TAX (₹ in crore) DEBT EQUITY RATIO

₹39,588 crore 13.1% y-o-y 0.74
CAGR
2018-19 39,588 26.1%* 2018-19 0.74
2017-18** 34,988 2017-18 0.75
2016-17 29,901 2016-17 0.75
2015-16 25,171 2015-16 0.78
2014-15 23,566 2014-15 0.74

EARNINGS PER SHARE (₹) BOOK VALUE PER SHARE (₹)

₹66.8 9.7% y-o-y ₹653.3 31.8% y-o-y

2018-19# 66.8 31-03-2019# 653.3

2017-18#
60.9 31-03-2018 #
495.6
2016-17 101.3 31-03-2017 891.2
2015-16 85.4 31-03-2016 785.5
2014-15 80.1 31-03-2015 742.3

SHAREHOLDERS METRICS

MARKET CAPITALISATION (₹ in crore) DIVIDEND PER SHARE (₹)

₹8,63,996 crore 54.5% y-o-y ₹6.5 8.3% y-o-y

CAGR
31-03-2019 8,63,996 31.9%* 2018-19# 6.5
31-03-2018 5,59,223 2017-18#
6.0
31-03-2017 4,28,909 2016-17 11.0
31-03-2016 3,38,703 2015-16 10.5
31-03-2015 2,66,847 2014-15 10.0
* CAGR since IPO
**Excludes exceptional item of `1,087 crore representing profit from divestment of stake in Gulf Africa Petroleum Corporation
#
Pursuant to issue of Bonus Shares in the ratio 1:1 in FY 2017-18

4 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

SOCIAL METRICS Consolidated

CONTRIBUTION TO NATIONAL
HSE EXPENDITURE (₹ in crore) R&D EXPENDITURE (₹ in crore) EXCHEQUER (₹ in crore)

₹664 crore 50.9% y-o-y ₹2,377 crore 30.3% y-o-y ₹1,16,251 crore 33.7% y-o-y

1,16,251
2,377
1,824
664

86,942
1,448

71,951
1,259
440
430

1,220
402

50,817
309

40,827
2014-15 2015-16 2016-17 2017-18 2018-19 2014-15 2015-16 2016-17 2017-18 2018-19 2014-15 2015-16 2016-17 2017-18 2018-19

CONSUMER BUSINESS METRICS RELIANCE FOUNDATION

NUMBER OF JIO
RETAIL STORES (nos) SUBSCRIBERS (FY 2018-19) (million) CUMULATIVE REACH (million)

10,415 306.7 million 26 million

26
10,415

306.7
7,573

20
280.1
252.3
3,616

12
215.3
3,245
2,621

6
5

2014-15 2015-16 2016-17 2017-18 2018-19 Jun 2018 Sep 2018 Dec 2018 Mar 2019 2014-15 2015-16 2016-17 2017-18 2018-19

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 5

LETTER TO SHAREHOLDERS
A robust foundation
for the golden decade

Dear Fellow Shareowners,

It gives me great pleasure to share with you the
exceptional performance of our Company in
FY 2018-19. Our revenue and profit numbers have
touched new heights, strengthening our position
as India’s largest private sector company by market
capitalisation and profitability.

Mukesh D. Ambani
Chairman and Managing Director

We now rank in the top 100 profitable In a volatile hydrocarbon chain subscribers at a rate unprecedented in the
companies in the Fortune Global 500 list of environment, Reliance recorded its highest- telecom world. With over 306.7 million
‘World’s Largest Corporations’. We delivered ever consolidated net profit of `39,588 mobile data subscribers, Reliance Jio has
a solid performance in our hydrocarbons crore (US$5.7 billion) during the year, propelled India to become the largest
businesses despite the volatile oil price registering a growth of 13.1% y-o-y. mobile data consuming market in the
environment and incremental capacities in The petrochemical business contributed world. The whole-hearted acceptance of
some of our product categories. record earnings, as the benefits of our Jio's digital services is evident from the
Consumer businesses witnessed investments in capacities and technologies sheer volume of data carried on its wireless
phenomenal growth in terms of revenues offset weak margins in the polymer chain. network – an astounding 3 exabytes per
and profitability, with Reliance Retail and Our refining business also delivered month. Jio is now ranked #1 among mobile
Jio now collectively contributing nearly resilient performance in a challenging telecom operators in the country, in terms
25% of consolidated segment EBITDA. global environment where gasoline of Adjusted Gross Revenue (AGR). With
margins have plummeted to a nine-year the demerger of fiber and tower assets,
Global economic growth remained healthy
low. Jio has emerged as an asset-light digital
at 3.6% in CY 2018, as against 3.8% in
services company. The demerger has also
CY 2017, impacted by weaker performance The strong financial performance also
significantly reduced our leverage and
in the European Union and China. reflected the increasing contribution
strengthened our Balance Sheet.
Economic activity was driven by a boost in of consumer businesses in Reliance’s
spending due to tax cuts by the US. earnings.
REFINING & MARKETING
Global trade growth was robust in the first
Retail business continues to scale Global oil demand growth at 1.2 mb/d in
half of 2018, but tapered later in the
new heights, achieving two important CY 2018 was around the 10-year average
year with trade tensions and higher
milestones during the year – crossing the despite higher oil prices. Brent, the global
energy prices.
turnover mark of `1,00,000 crore and the crude oil benchmark, at US$71/bbl in CY
The Indian economy continued to witness store count of 10,000. We are witnessing 2018 was higher at US$17/bbl y-o-y.
an increase in investments, with Gross strong traction across consumption US, China and India accounted for almost
Fixed Capital Formation growth at a baskets, achieved on the back of all of the global oil demand growth,
six-year high of 10%. Healthy industrial unmatched service and value proposition. with oil consumption in these economies
activity continued and service indicators The strong improvement in profitability rising by 1.1 mb/d.
sustained positive trends. Service exports reflects our increasing scale and focus on
On the other hand, global oil supply grew
growth is at a seven-year high of almost efficiencies.
by 2.6 mb/d in CY 2018. Non-OPEC supply
17%. The Indian economy remains the
It is heartening to see India embrace the grew by 2.7 mb/d, on the back of strong
fastest growing major economy in the
digital life. Reliance Jio continues to add
world.

6 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

supply growth in the US (2.2 mb/d) and The complex is currently under By leveraging the capabilities in polymer
Canada (0.4 mb/d). OPEC (Organization of stabilisation. On the domestic retail front, formulations, materials engineering,
the Petroleum Exporting Countries) supply with a countrywide operational network of product design and 3D printing, Reliance
contracted by 0.1 mb/d y-o-y in CY 2018 1,372 retail fuel outlets, RIL is covering all is strengthening its new business line for
as a result of sharp production declines the key highways in the country. Advanced Materials & Composites to deliver
in Venezuela and adherence to the supply innovative products and solution offerings
restraint deal between OPEC and non-OPEC PETROCHEMICALS to the industry.
producers. Petrochemicals segment demonstrated
the earning power of the new plants OIL & GAS
The Refining & Marketing segment reported
commissioned over the last investment FY 2018-19 marked progress on
a decrease of 19.8% y-o-y in EBIT– amidst a
cycle, unmatched integration and feedstock plans to monetise our discovered
challenging price margin environment and
flexibility. During the year, we commenced deepwater resources. Development work
particularly weak gasoline demand in the
cracking of Ethane at Nagothane. The for R-Cluster and Satellite Cluster fields
second half of the year. Gasoline margins
impressive earnings in the petrochemicals has commenced, while field development
have been impacted due to weak demand
business is a result of Reliance’s plans for MJ have been approved by the
growth, with high pump prices and strong
investments over the last few years. This is government. These fields are expected to
refinery runs leading to rising inventories.
reflected in the record production of 37.7 come on-stream from mid-2020.
At US$9.2/bbl, RIL's refining margin MMT and highest ever earnings delivered We also progressed on the second phase
remained relatively strong even by the business this year. The EBIT margins of development activities at our domestic
in a dynamic and volatile market. increased by 180 bps this year on the CBM blocks to enhance production from
RIL maintained a significant premium of back of strong integrated polyester chain these fields.
US$ 4.3/bbl over the benchmark Singapore margins.
Our ongoing upstream business continues
complex margins. RIL’s superior refining
The strong results were achieved in an to be impacted by a natural decline in
margins are a result of superior product
environment of declining utilisation rates in volumes. Domestic production was down
slate, robust risk management and higher
key product chains with new supply 25.4% at 58.9 Bcfe, while the US Shale
secondary unit throughputs.
ramp-up. This demonstrates the resilience volume fell 32.4% to 94.5 Bcfe during
All units of the gasification complex, of the Reliance business model, which is FY 2018-19. There has been steady
including air separation units, material based on deep inter-linkages between production from the CBM fields in
handling systems, gasifier islands, syngas refining and petrochemical chains, Sohagpur.
shift and processing facilities, sulphur feedstock flexibility and a wide
recovery units, and associated utilities and product portfolio.
off-sites, have been started safely.

At US$9.2/bbl, RIL's refining margin The petrochemicals business earnings Development work for R-Cluster and
remained relatively strong even in a reflect the benefits of Reliance’s Satellite Cluster fields has commenced
volatile market dynamics. investments over the last few years. while field development plans for
MJ have been approved by the
government.

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 7

LETTER TO SHAREHOLDERS (CONTD)

RELIANCE RETAIL DIGITAL SERVICES Wireline network connectivity in India

Reliance Retail became the first retailer in Jio added an average 10 million subscribers continues to remain underserved.
India to cross the `1,00,000 crore turnover a month and crossed the 300 million Jio is working towards serving the need
milestone and is now ranked 94th in subscriber milestone this year to become for better connectivity with its GigaFiber
Deloitte’s Global Powers of Retailing 2019 the world’s fastest growing digital services services. This would include home
list. Reliance Retail also crossed the 10,000 company. Jio has not only revolutionised broadband, entertainment and smart home
store count milestone. It has cemented India’s telecommunication industry but IoT solutions. Jio, with its FTTH services,
its position as India’s largest retailer also digitised its hinterlands through its has set a target to connect 50 million
by revenue and profitability, delivering extensive network penetration. Recently, homes across the country. To accelerate
superior value to its customers, suppliers Jio was recognised for its meaningful Jio’s commitment to connect 50 million
and other stakeholders. impact by being ranked #1 globally on homes with Jio’s solutions, RIL has
Fortune’s 'Change the World' list. made strategic investments in Hathway
Reliance Retail’s revenue growth in
The ranking evaluates companies that use Cable and Datacom Limited and DEN
FY 2018-19 was primarily driven by
the profit motive to help the planet and Networks Limited.
aggressive store addition and spurt in
make an important social impact.
same-store sales. Growing at a rate of During the year, Jio demerged passive
nearly 10 stores per day in the last two Jio maintained a healthy growth tower and fiber infrastructure into an
years, Reliance Retail witnessed one of momentum in financial parameters too, InvIT structure. Jio has now emerged
the fastest store expansions in the world. with its EBITDA and net profit witnessing as an asset-light, focussed digital
It added a total of 2,829 stores to its tally a sharp growth of 124% y-o-y and 310% services company.
during FY 2018-19. As on March 31, 2019, y-o-y, respectively.
Reliance Retail operated 10,415 retail stores CREATING AN INDIAN DIGITAL
The phenomenal level of customer
in over 6,600+ towns and cities, covering ECOSYSTEM
engagement on Jio’s platform is evident
22 million sq. ft. of area. We are making a strategic transition
from the fact that over 3 exabytes per
by creating multiple platforms across
Reliance Retail’s New Commerce initiative month of data is carried on its wireless
consumer business, agriculture, education
is now in the pilot phase. The differentiated network. Every Jio subscriber consumes
and healthcare that will accelerate our
business model will provide a technology on an average 10.9 GB data, 823 minutes
growth. In addition to its own digital
platform for millions of small merchants of voice calls and 17 hours of video per
platform, in the past year, Reliance has
across India to strengthen and grow month. In CY 2018, Jio carried close to 71%
partnered with more than a dozen
their business. Leveraging technology of the total 4G traffic of India.
coming-of-the-age businesses. These
and connectivity, the platform will drive
It has also entered into a series of content are mostly in the Technology, Media and
efficiency and value creation for all players
partnerships with Disney and Star India, Telecom (TMT) and retail sectors, along
in India’s retail market –principally the
among others, to provide best-in-class with strategic investments in two major
producers / brand owners, supply chain,
content to its subscribers. MSOs – Hathway and Den. Reliance
merchants and customers.
believes that creating an ecosystem with
new-age entrepreneurs will help unleash
the potential of India’s vast human capital.

ROBUST CASH FLOWS AND BALANCE

SHEET
During the year, Reliance generated a
record PBDIT of `92,656 crore, up 26.8%
y-o-y, and its highest ever net profit of
`39,588 crore, up 13.1% y-o-y. RIL enjoys
prime credit ratings as a result of its fiscal
prudence and strong cash flows. We have
retained our domestic credit ratings of
Expanding at the rate of nearly 10 Providing the power of data and
‘CRISIL AAA’ from CRISIL and ‘IND AAA’ from
stores per day in the last two years internet to rural India and the lowest
India Rating. For our international debt,
economic strata

8 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

we have an investment grade ‘Baa2’ rating SUSTAINABILITY I would like to convey my sincere
from Moody’s and ‘BBB+’ from S&P. We are committed to making continuous appreciation to the Board of Directors
improvements across the triple bottom line for their guidance. I would also like to
During FY 2018-19, Reliance Jio Infocomm
and enabling positive change in the society. express my heartiest gratitude to all our
Limited (RJIL) successfully tied up
Our ability to manage, utilise and transform stakeholders for their enduring faith in
JPY 53.5 billion – the largest Samurai
the six capitals – Natural Capital, Human Reliance.
loan for an Asian corporate and also for a
Capital, Manufactured Capital, Intellectual
telecom company. Additionally, RJIL tied
Capital, Financial and Social and
up US$825 million and EUR 150 million
Relationship Capital – is the key to creating With best wishes,
K-Sure-supported Export Credit Agency
value for our stakeholders. In our continued Sincerely,
(ECA) financing with door-to-door tenor
pursuit of excellence, noteworthy capital
of over 10 years – the largest financing
investments were undertaken, which led
transaction globally in the telecom sector
to reduction of carbon emissions and
supported by K-Sure.
enhancement of resource efficiency. We
The demerger of the tower and fiber are committed to becoming a leader in the
assets of Jio into separate InvITs has emerging circular economy and becoming
helped establish Jio franchise as an asset- one of the largest recyclers of plastics Mukesh D. Ambani
light digital services company. in India. Chairman and Managing Director
The transaction has resulted in a significant July 2, 2019
Integral to growing revenue is the
liability reduction for Reliance.
ongoing improvement of our social and
Reliance will also get to participate in
relationship capital. Reliance Foundation
value-unlocking through third-party use
is committed to bringing about a positive
of these infrastructure assets through the
change in the lives of our stakeholders. Our
preference shares that Reliance holds in
business objectives are aligned with the
these entities.
Global Sustainable Development Goals,
which is reflected through our work in
GOVERNANCE AND SAFETY
the areas of rural transformation, health,
Reliance’s governance standards are built
education, sports for development, disaster
on the foundation of systems that support
response, arts, culture and heritage, and
transparency and ethical business conduct.
urban renewal. In FY 2018-19, there was
In an effort to strengthen risk management
an impressive growth in the number of
and internal controls, Reliance instituted
beneficiaries of our community outreach
the Reliance Management System (RMS),
programmes.
designed to operationalise a harmonious
work culture by codifying and embedding
CONCLUSION
standardised processes into the DNA of
We are in a rapidly changing world where
every function. RMS has been further
digital connectivity and abundance of
strengthened by leveraging the power of
data is reshaping value creation models
digitised platforms.
across verticals. We continue to improve
In all our businesses, the health and safety and evolve consistently, fostering an
of our employees is sacrosanct. This year entrepreneurial mindset across the
marks a decade of safe operations in organisation. Overall, we delivered yet
the E&P business, which is a significant another year of robust performance,
achievement compared to any benchmark. achieving remarkable success across our
In FY 2018-19, we intensified our efforts businesses. I would like to thank the entire
on safety by implementing Competency team at Reliance for their untiring efforts
Assurance System to ensure reliable and unflinching commitment to achieve
operation delivery and safety competence the lofty goals we have set for our
among the frontline staff. golden decade.

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 9

BOARD OF DIRECTORS

Shri Mukesh D. Ambani Smt. Nita M. Ambani Shri Mansingh L. Bhakta

Chairman and Managing Director Non-Executive, Non-Independent Director Lead Independent Director

C C C M

Shri Yogendra P. Trivedi Prof. Dipak C. Jain

Independent Director Independent Director

Committees
 Audit Committee
 Stakeholders’ Relationship
Committee
 Corporate Social Responsibility
and Governance Committee
 Human Resources,
Nomination and
Remuneration Committee
 Finance Committee
 Health, Safety and Environment
Committee
M M M M C C M  Risk Management Committee

Dr. Raghunath A. Mashelkar Shri Adil Zainulbhai

C Chairman M Member
Independent Director Independent Director

10 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

M M M M M

Shri Raminder Singh Gujral Dr. Shumeet Banerji

Independent Director Independent Director

M M M M M C M M M

Shri Nikhil R. Meswani Shri Hital R. Meswani

Smt. Arundhati Bhattacharya
Executive Director Executive Director
Independent Director

M M M

Shri P. M. S. Prasad Shri Pawan Kumar Kapil

Executive Director Executive Director

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 11

Connecting everyone. Connecting everywhere.
Reach

Infrastructure

REFINING AND
MARKETING Managing
650 million transactions Fuel retail
Jamnagar site has annually across fuel RIL network serves
retail network processing
complexity index of 21.1 500 districts & cover
1.5% of global
68.3 MMT crude Every 3.5 minutes, transportation ~2,90,000 kms
RIL fuels a plane & every fuel of National and State
throughput Highways
9th diesel engine is fuelled
Crude Processing Capacity by RIL, in India
1.24 mbpd

PETROCHEMICALS
Created the world’s first Fashion-for-Earth
and only virtual pipeline initiative connected Petrochemical
for Ethane from USA to 2,000 million with end consumers for products exported
RIL plants in India with PET bottles recycled sustainability in to over
annually fashion with
6 VLEC’s and pipelines on 100 countries
the ground 75 million
impressions
World’s first ever Refinery
Off-Gas Cracker (ROGC)
complex of 1.5 MMTA
capacity
37.7 MMT petrochemicals
production

OIL & GAS

Shahdol-Phulpur
Portfolio includes
302 kms
operations in conventional pipeline connects
deep water acreages and CBM gas fields
unconventional Coal Bed (Shahdol, MP) to the Indian
Methane (CBM) block gas grid (Phulpur, UP)

100% Field uptime in

KG D6 operations

12 Reliance Industries Limited  |  Integrated Annual Report 2018–19

Connecting everything.

Infrastructure

RETAIL
Connects to the
customer through 10,415 stores covering
its presence over Over
500 million 22 million sq ft area
6,600
towns and footfall in Reliance Retail operates
cities including Retail stores
the most extensive store
Tier II and III cities network in the country

DIGITAL SERVICES
Jio is fast
approaching its Jio has built the country’s
306.7 million largest all-IP data network
subscribers on target of 99%
Jio network population on 4G-LTE technology
coverage
The Jio network carries
over 3 Exabytes of data
and over 250bn VoLTE
minutes per month

Network18's Network18's MEDIA &

digital content properties
are now used by
television channels 1 in every 2 Indians is a ENTERTAINMENT
reach out to consumer of Newtork18's
> 130 million 800+ million broadcast content Network18 boasts of a
people people in India portfolio of 55 domestic
channels.
#1 News network by
viewership

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 13

BUSINESS MODEL: INTEGRATED REPORTING
Multi-capital approach to value creation

INPUTS PROCESS
VISION
NATURAL CAPITAL Page 112
Through sustainable measures, Reliance creates value for the nation,
• Zero freshwater withdrawal at Jamnagar
enhances quality of life across the entire socio-economic spectrum and helps
Manufacturing Division
spearhead India as a global leader in all the domains where it operates.
• 2,650.68 (000' GJ) of energy saved from
conservation initiatives

HUMAN CAPITAL Page 120

• ₹664 crore of HSE expenditure
• 23,000+ ideas on Mission Kurukshetra
innovation platform Refining and Petrochemicals Oil and Gas
• 66+ lakh man-hours of training imparted Marketing Exploration &
PAGE 20
• Employees from over 16 nationalities PAGE 16 Production
PAGE 24
BUSINESS MODEL

MANUFACTURED CAPITAL   Page 132 ent

• ₹10,02,406 crore of asset value o nm S
r
vi 49 Pg tra
• Over 170 crude grades processed at 8-
11
Pg En

te 111
Jamnagar

gy
al
4

Deliverables

0-
ern

• Crude processing capacity of 1.24 mbpd

Ext

Inputs

INTELLECTUAL CAPITAL Page 140

• 164 patent applications filed during the year
Business
Differentiators

Outcomes
Digtal g 147

e
Pg formanc
• 900+ researchers and scientists

107
• Strategic partnerships with leading
P
Pla

organisations/institutes 52-
tfo

Per

• Partnering with technology platforms to

rm

create a digital ecosystem

s

Ent
erpr ent
ise Risk Managem
Pg 162-168
FINANCIAL CAPITAL Page 148
₹1,32,445 crore of capital expenditure

SOCIAL AND RELATIONSHIP Page 150

CAPITAL
• Goods and services worth ₹18,566 crore
sourced from indigenous suppliers Retail Digital Services Media and
• With over 8,000+ applications, 106+ start-ups Entertainment
supported through JioGenNext PAGE 26 PAGE 30 PAGE 34
• `904 crore spent on CSR initiatives

14 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

VALUE CREATION
RIL’s business model and outcomes are aligned with the Integrated Reporting framework of International Integrated
Reporting Council (IIRC), the United Nation’s Sustainable Development Goals (UN SDGs) and 14 other frameworks.

OUTPUTS OUTCOMES UN SDGs

Non-hazardous waste Total water recycled • Mitigating global warming
• Investments in long-term renewable
798.61 (000' MT) 73,142.1 (000' m ) 3
energy solutions
• Promoting use of eco-friendly fuels and
Waste water discharge One of the largest recyclers
clean technology
of PET bottles (~2 billion)
27,871.9 (000' m ) 3
• Resource stewardship

Focus on millenial Collaboration with • Healthier and safer working environment

workforce world-class universities • Enhanced employee engagement
• Investing in proficient workforce
• Direct and indirect employment
49.8% generated
plus are millennials
• Facilitating leadership programmes

Crude throughput • World-class infrastructure facilities

Over 500 million
• Creating a digital ecosystem
footfalls in Retail stores 68.3 MMT • Future-ready for transition to 5G and
Gross refining margin Petrochemical production beyond
• Most extensive retail store network in the
US$9.2/bbl 37.7 MMT country
Spectrum footprint
R|Elan specially engineered
1,108 MHz sustainable fibre

Have investments in Patents granted • Driving innovation culture with next-gen

IP-rich companies such as technologies
Haptik, Indiavidual
120 • Product stewardship
(Embibe), Reverie • Breakthrough R&D in big data and
Sankhyasutra among others digitalisation
Over 4,000
customisations of plant
manufacturing process

Total Revenue Return on Capital Employed • Strong earnings per share

(standalone) • 31.9 % CAGR in market capitalisation
`6,22,809 crore
24.9%
Profit After Tax Earnings per share
`39,588 crore `66.8
Villages impacted Urban locations impacted • Building sustainable livelihoods
• Enhanced community reach
18,000+ 200+ • Effective stakeholder engagement
through RF through RF
• Better customer experience through
digitisation
Customer engagement Total Value Added during
metrics continued to the year
increase
` 2,18,163 crore

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 15

BUSINESS REVIEW
Refining and Marketing (R&M)

MAJOR PRODUCTS AND BRANDS

Crude processing
capacity

1.24 mbpd

REFINING

Propylene
Feedstock for polypropylene
LPG Gasoline
Domestic, commercial and Transport fuel
industrial fuel
Alkylate
Naphtha High-octane blend stock for
Feedstock for petrochemicals gasoline
such as ethylene, propylene
Petroleum Coke
and fertilisers and as fuel in
Fuel for power plants, cement
power plants
plants and feed for gasification
High Speed Diesel
Superior Kerosene Oil
Transport fuel
Domestic fuel
Sulphur
Aviation Turbine Fuel
Feedstock for fertilisers and
Aviation fuel
pharmaceuticals

16 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

PETROLEUM RETAIL

Reliance Gas
Liquefied Petroleum Gas (LPG)
Domestic, commercial and
industrial fuel

Reliance Petroleum Retail

Transportation Fuels
Jamnagar site Retail distribution of fuels
has complexity
index of Auto LPG
Auto LPG
21.1 Auto fuel outlet

Trans Connect
Fleet Management Services
Fleet management solutions

A1 Plaza
Highway Hospitality Services
Highway food plaza

Qwik Mart
Convenience Shopping
Shopping of beverages, snacks
gifts on highways

Refresh
Foods
Passenger amenities / food
courts on highways

Relstar
Lubricants
Engine oil and lubricants

Reliance Aviation
Jet/Aviation Turbine Fuel
Aviation fuel

Reliance Petroleum
retail outlets

1,372

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 17

BUSINESS REVIEW (CONTD)

Refining and Marketing (R&M)

VISION
Jamnagar shall be the refinery
icon of the world with
best-in-class performance

MISSION
Ensure the Jamnagar refinery
is future-ready with a strategic
transformation to optimal
oil-to-chemicals

MEGATRENDS STRENGTHS
1
Bottomless Product Slate
Producing oil products at higher margins Best-in-class Portfolio
Jamnagar site has
complexity index
2 of 21.1
Oil-to-Chemicals
Integrated value chain from oil-to-chemicals Crude Selection and
Sourcing
Crude portfolio
3 Increasing the optimisation
Technological Revolution
Advantage
Innovation through application of technology
Through the Petcoke
Gasification complex
4 Readiness for
New Energy
oil-to-chemicals
Alternate energy ‘renewables’
Logistics and Supply-
5 Chain
Cleaner Fuel State-of-the-art
Cleaner and sustainable form of mobility, logistics infrastructure
including e-regulatory changes of IMO 2020

READ MORE ON PAGE 54

18 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

ILLUSTRATION

Propane – Surging
growth story

Action
Undertook detailed assessment to
identify potential industries and
benefits vis-à-vis substitutes of High
Speed Diesel (HSD) and partnered
with customers to provide know-how
on installation and usage

Outcome 
RIL has become the preferred
propane supplier to auto ancillary,

ceramic and steel industry.
Growth in monthly sales

400%

PERFORMANCE

Revenue (` in crore)  EBIT (` in crore)  GRM (US$/bbl) Outperformed Singapore complex refining margins by (US$/bbl)


6.6 8.4 8.6 9.2 8.1 8.6 10.8 11.0 11.6 9.2


3.1 3.2 0.7 1.4 2.2 2.3 3.3 5.2 4.4 4.3
5,00,000 

4,05,852 3,93,988
4,00,000 3,72,923 
3,39,890
3,26,532 3,06,095
3,00,000 2,50,833 
2,35,175 2,34,945
25,056 24,782*
1,75,120 23,534
2,00,000 
19,868
15,827
12,815 13,392
1,00,000 
9,182 9,847
6,056
0 
2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19
* Excludes exceptional item of ₹1,087 crore representing profit from divestment of stake in Gulf Africa Petroleum Corporation during FY 2017-18

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 19

5,00,000
BUSINESS REVIEW (CONTD)

Petrochemicals PHARMA AND HEALTHCARE

Medicine blister packs, syringes,
blood bags, IV bottles and lab coats
for doctors
MAJOR PRODUCTS AND BRANDS

INFRASTRUCTURE
Roads, buildings, windmills, solar panels
and telecom poles (Jio)

TRANSPORT AND
AUTOMOTIVE
Metro, cars, mass
transport and tyres

WATER STORAGE AND SUPPLY

Water storage tanks and PVC pipes

AGRICULTURE/PLASTICULTURE
Drip irrigations, pond linings, crop/fruit
covers, sprinklers, mulching and silage bags
37.7 MMT
Highest petrochemical
production

20 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

RESIDENTIAL
Apparels, beds, sofas, rugs,
pillows, wood floors, curtains,
consumer durables and FMCG
SPORTS
Golf balls, turf and
sportswear

World's
largest
Integrated polyester
producer

PACKAGING
Plastic bottles and disposable
packages

11
locations in India
INDUSTRIAL
3 Cables and ducting, and 3D printing
in Malaysia

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 21

BUSINESS REVIEW (CONTD)

Petrochemicals

VISION
To be among the Top 5
petrochemical companies
in the world

MISSION
To enrich lives and deliver
smiles by harnessing the power
of chemistry

MEGATRENDS STRENGTHS
1
Oil-to-Chemicals
Integrated value chain from oil-to-chemicals Integrated
Petrochemical Producer
Refinery generating
2 world-class products at
Technological Revolution
Jamnagar
Innovation through technology, materials
Wide Product Portfolio
engineering, product design and
Moving closer to the
market-focused application development
consumer with every
3 Sustainability/ Circular
Sustainability and Circular Economy product and brand
economy
Closing the loop and rethinking raw materials
Creating value from
waste
4 Feedstock Flexibility
Urbanisation
Increased with JMD
Meeting the new global market demands
expansion
Market Environment
and Responsiveness
5 Record high
Evolving Consumption Patterns
productions to meet
Transforming lifestyles of the diverse masses
market demands

READ MORE ON PAGE 62

22 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

ILLUSTRATION

Catalysing waste reduction, increasing sustainability in fashion

Fashion industry has a large carbon footprint due to the complexities involved in the long
value chains for raw material sourcing, manufacturing, product processing, dyeing and
colouration, shipping, retail, consumer use and post-use disposal.

Action
Reliance Petrochemicals launched 'Fashion-for-Earth', an overarching initiative that provides
a thrust to usage of materials in a sustainable manner, inculcates circularity in the fashion
industry and inspires like-minded partners and the downstream industry to adopt waste
reduction, thereby contributing to the enhancement of the quality of life of our future
generations. 
Scale of Impact: Reliance launched a number of nation-wide initiatives such as #earthtee,
Circular Design Challenge and #EOOTD under the Fashion-for-Earth initiative. More than 75
million consumer impressions were achieved. 

Outcome
Several industry leaders, designers, celebrities and social influencers were involved

in raising environmental awareness. Each initiative was covered by the leading
newspapers, magazines and television channels, leading to a multiplier effect.

PERFORMANCE 

Revenue (` in crore)  EBIT (` in crore)  EBIT margin (%)


14.6 14.1 10.5 7.6 8.1 8.6 12.4 14.1 16.9 18.7

2,00,000 
1,72,065

1,60,000 
32,173
1,25,299
1,20,000 1,04,018
94,177 96,804 92,472
86,462 21,179 
82,410
80,000 67,692
59,154
12,990 
9,540 10,186
40,000 8,641 9,060 8,291
7,159 8,403


0
2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19

2,00,000
Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 23
BUSINESS REVIEW (CONTD)

Oil and Gas Exploration & Production

MAJOR PRODUCTS AND BRANDS OIL AND GAS ASSETS

The Company’s oil and gas
assets include KG D6,
Panna- Mukta, Tapti and two
CBM blocks. RIL also has
two joint ventures in North
American shale plays – Pioneer
Natural Resources and Chevron.

₹35,000
crore
Development plan
underway in the
KG D6 block

100%
Field uptime in KG D6
operations

24 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

VISION
Towards energy security for
the nation
MISSION
Our mission is to maximise stakeholders'
value by finding, producing and marketing
hydrocarbons and to provide sustainable
growth while catering to the needs of
customers, partners, employees and the
local communities in which we do business.
We will conduct our business in a manner
that protects the environment as well as
the health and safety of our employees,
contractors and the local communities in
which we do business.

Deepwater Pipeline Installation

MEGATRENDS ILLUSTRATION
1 2
Energy Security within Advantaged Oil
jurisdiction Short cycle time for Effective use of thermal imaging
Meeting India’s energy field development camera for real-time detection of
demands
minor / major gas leaks
STRENGTHS

Action
Project Execution
Short duration from Portable infrared thermographic cameras being
discovery to extraction used which can operate in wavelengths as long as
14,000 nano metres to detect minor hydrocarbon
Resilient Infrastructure gas leaks as low as 0.35g/hr.
Strong offshore
Scale of Impact: Undetected gas leaks at more than
capabilities in India
20 locations were identified in the plant
and rectified.
Safety
Paramount focus on safety
(zero accidents and 100%
compliance) Outcome

Enhanced workplace safety, and reduced

Partnerships
emissions and maintenance costs.
Partner of choice for
global majors
READ MORE ON PAGE 72

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 25

BUSINESS REVIEW (CONTD)

Retail
STORE AND SERVICE CONCEPTS

MAJOR PRODUCTS AND BRANDS

Number of stores
opened over the last
two years

~ 10 a day

IN-STORE BRANDS

Presence in towns
and cities

6,600+

26 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

Reliance Retail
operates

10,415
stores

EXCLUSIVE PARTNERSHIPS

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 27

BUSINESS REVIEW (CONTD)

Retail

VISION
To be the most admired and successful
organised retail company in India that
enhances the quality of life of every Indian

MISSION
• Provide millions of customers with unlimited choice,
outstanding value proposition, superior quality and
unmatched experience across the full spectrum of
products and services
• Serve the entire spectrum of Indian society i.e., from
households, kiranas and traders, to small and medium
enterprises and large corporations
• Reach the length and breadth of the country through
our physical and digital distribution platforms
• Enable the choice, opportunity and livelihood of our
supplier ecosystem consisting of producers, farmers,
artisans, craftsmen and manufacturers
• Generate direct and indirect employment opportunities
with skill transformation and talent development on an
unprecedented scale

MEGATRENDS STRENGTHS
1
Integrating Value Chain
Diversified Portfolio of Customer-focussed
Connecting suppliers, small and large, to
Stores across Various Robust Ecosystem
B2B and B2C customers through a pan-India
Consumption baskets Providing unlimited
ecosystem
Leadership in key choice, superior value
consumption basket proposition, and
quality and unmatched
2 experience across all
Digitisation retail stores
Connecting physical and digital spaces, with
endless aisle kiosks and multiple payment Adaptive / Responsive Partner of Choice
modes with real-time analytics support Maintaining market Largest portfolio of
leadership international retail
brands in India

3
Bridging Urban-Rural Divide Serving the Multi-channel Strategy
Bringing quality products at affordable Underserved Markets Integrated
prices to smaller tier cities, meeting Expanding at the rate ‘offline-online’
demand gap and offering employment of 4 stores every day models
for the last 5 years

READ MORE ON PAGE 80

28 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

SOCIETAL VALUES (UN SDGs) ILLUSTRATION

Decent Work and Gender equality Responsible consumption

economic growth and production

Action Action Action

Providing employment to people with Specific focus on gender sensitisation Recycled plastic waste into objects
minimum education (10th or 12th standard), programmes for male staff, ensured high such as spectacles, park benches
giving them the opportunity to advance levels of awareness on Prevention of Sexual and fishing nets, and partnered
their education, and providing extensive Harassment (POSH) at workplace, opened 6 with Tetra Pak to run a 'Go Green'

functional and behavioural training Reliance SMART stores and 1 Reliance Digital initiative.
store run completely by women employees
Scale of Impact: Reliance Retail currently Scale of Impact: Integrating green
employs nearly 46,000 people with this Scale of Impact: As of March 31, 2019 22% practices in day-to-day operations.
qualification. of Reliance Retail's pan-India workforce
comprises of women.

Outcome Outcome Outcome
Balanced workplace with equal Equal opportunities to all individuals Sustainable growth through
opportunity at every level, inclusive and fairness in all employee-related responsible business practices,
growth, career progression and economic policies. ensuring societal values.
advancement of employees.

PERFORMANCE

Revenue (` in crore)   EBIT (` in crore)   EBIT (%)


(11.0) (11.1) (8.7) (2.8) 0.8 2.4 2.4 2.3 3.0 4.2

1,40,000 
1,30,566
1,20,000
5,546 
1,00,000

69,198 
80,000

60,000

33,765
40,000 21,075
14,556 17,640 2,064
784 
4,565 6,102 7,636 10,845
20,000 504
417
118
0 (503) (307) 
(679) (668)

2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19

1,40,000
Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 29
1,20,000
BUSINESS REVIEW (CONTD)

Digital Services

MAJOR PRODUCTS AND BRANDS

Jio4GVoice
VoLTE and rich
communication on all
phones

MyJio
Manage your Jio
account

306.7
million JioNews JioSaavn JioHealthHub
Subscribers for Complete package Music for you. Anytime, Your digital health
for digital news and Anywhere vault
Reliance Jio magazines

JioCinema
JioTV
Entertainment at your
Live and Catch Up TV on
fingertips
the move

30 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

JioCloud
Ranked Store and access your
files from anywhere
#1
In India by Adjusted JioNet
Gross Revenue Gateway to India’s
largest Wi-Fi network

er
i gaFib
G
Jio

ber
i gaFi
G
Jio

Embibe JioChat JioSecurity

Education platform Free chat, SMS, voice Protect your phone,
and video calls secure your data

JioGST JioMoney & Jio JioSwitch

GST service provider Payments Bank Secure file transfer
Experience cash-free living and share

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 31

BUSINESS REVIEW (CONTD)

Digital Services

VISION
To connect everyone and everything,
everywhere – always at the highest
quality and the most affordable price.
Jio’s vision is to transform India with
the power of digital revolution
MISSION
• Connectivity for every Indian
• Superior customer experience
• Affordable data
• Best-in-class fixed-line solutions platforms

Narrowing the Urban-Rural Divide

MEGATRENDS STRENGTHS
1
Mobility as First Screen for Internet
Low fixed-line penetration (<7% of households)
and improving mobile device ecosystem to Coverage
lead to >800 million mobile internet users Jio’s 4G coverage has allowed it to serve
2 underpenetrated areas and is approaching
Smartphone Transition
its target of 99% population coverage
Of the 850 million unique user base, only 400
million are smartphone users. This provides a
huge runway for growth.
3 Capacity
Narrowband IoT*
Extensive infrastructure deployment
Non-mobile IoT devices to reach >1.3 billion
with multiple spectrum band gives Jio
in India by 2022, finding utility in home and
unparalleled network capacity, low latency
enterprise applications
4 and high speed
Technology Platforms
Data network proliferation will lead to
platforms that will digitise customer lifecycle Distribution
across ecosystems Jio has set up an extensive distribution
5 network of over 7,600 Jio Stores (through
Narrowing the Urban-Rural Divide
Reliance Retail) and over 1 million retail
Low rural Internet penetration at 25% vis-à-vis
touchpoints to serve its expanding
93% for urban markets presents opportunity to
customer base
expand digital consumer services.

READ MORE ON PAGE 90

*Source: FICCI Media and Entertainment Report 2019

32 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

ILLUSTRATION

Providing prompt relief JioPhone empowering women

during natural disasters in rural India

Action Action
Resumed network services during Kerala Enable rural women to access the Internet
floods within 24 hours and helped BSNL and share information on education,
resume services in Munnar health, family welfare, farming and
government schemes
Scale of Impact: Connectivity
services in Kerala Scale of Impact: Women in rural India
(e.g., the e-Sakhi programme run by the
Government of Rajasthan)


Outcome Outcome

Helping people connect with Social and economic development
families by restoring network of women in rural India, thereby
accelerating India’s digital revolution 


PERFORMANCE


Operating Revenue (` in crore)   EBIT (` in crore)  Jio Subscriber Base (In million)

138.6 160.1 186.6 215.3 252.3 280.1 306.7 

13,609
14,000 
12,302
10,942
11,200 
9,653
8,136 8,421
8,400 7,213 

5,600 

2,362 2,665
1,715 2,042
2,800 1,440 1,495 
261

0 
Sep - 2017 Dec - 2017 Mar - 2018 Jun - 2018 Sep - 2018 Dec - 2018 Mar - 2019

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 33

14,000
BUSINESS REVIEW (CONTD)

Media and Entertainment

DIGITAL ENTERTAINMENT
Touching hearts everywhere,
everytime, across devices PUBLISHING BUSINESS
MAJOR PRODUCTS AND BRANDS Class-leading specialised print
magazines

TV CHANNELS
Diverse content, impactful brands
Network18 boasts of 55 channels
in India spanning news and
entertainment, including 16
international channels

DIGITAL COMMERCE
Pioneering, ubiquitous platforms

DIGITAL NEWS
Marquee properties that enlighten millions
FILMED ENTERTAINMENT
CONTENT ASSET
Fresh subjects and an enviable
MONETISATION
success rate

34 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

VISION & MISSION

MEGATRENDS
Network18 aims to be a channel-agnostic
provider of top-drawer content, across 1 2
genres, regions and languages. We aim to be Vernacular Content Digital Delivery
India’s top media house with unparalleled Consumption and the OTT Wave
reach, and touch the lives of Indians across
geographies and genres
STRENGTHS
Market leader in multiple genres (Business News #1,
leading premium urban channels in both Hindi
general news and general entertainment, and Kids #1 –
dominates the English entertainment space).

'Network effect' and play on vernacular media
growth - Benefits of regional portfolio across News
(14) and Entertainment (8) channels.

Marquee digital properties such as MoneyControl
and VOOT provide content synergy and future
growth avenues.

READ MORE ON PAGE 100

PERFORMANCE 

No. of domestic channels  Viewership share of overall TV (%)



100 

75 13.4 13.4 
12.9
11.9

50 52 55 
50
41

25 

0 
2015-16 2016-17 2017-18 2018-19

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 35

100
RELIANCE FOUNDATION
Catalysing transformative change
Reliance Foundation was instituted with a vision to build a stronger and inclusive India. CSR activities of RIL are
carried out under the umbrella of Reliance Foundation. Led by Smt. Nita M. Ambani, Reliance Foundation has a
comprehensive approach towards the nation's development. With the aim of building better lives and improving
the livelihood of the people for a stronger and inclusive India, the Foundation addresses some of India's most
pressing development challenges.

RURAL TRANSFORMATION
Creating sustainable livelihood solutions, addressing poverty,
hunger and malnutrition

7.2+ million 75%

Livelihoods Fisher folk reported positive
augmented since outcomes by following
inception information advisories

434 83% 80%

Water-secured Farmers reported Increase in daily vegetable
villages, since saving input cost on intake among children enrolled
inception agriculture in anganwadis under the
Nutrition Mission, Maharashtra

77% 73%
Of farmers reported Families are food-secure with availability
enhancement in of adequate quantity of food grains
income levels throughout the year

HEALTH
Affordable solutions for healthcare through improved access,
awareness and hygienic behaviour

6+ million 18,000+ 1,700

Health consultations, Corneal transplants Individuals from underprivileged
since inception for vision care, since segments were provided with
inception sight and livelihood

63% 93%
Of malnourished children showed Patients screened positive for
improved health tuberculosis were cured with
routine treatment and follow-ups

EDUCATION
Access to quality education, training and skill enhancement

12,285 14
Dhirubhai Ambani Schools with 16,000
scholarships disbursed students enrolled

1,000+ 98%
Teachers awarded RF Teachers award Pass percentage of students in
for their outstanding contribution Classes 10 and Class 12 in RF schools

36 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

SPORTS FOR DEVELOPMENT

Promoting sports amongst youth to facilitate their skills and
development

Sports programme marks its presence in additional 36 cities

(70 cities since inception)

5 million RF Jr. NBA

Children reached through the sports Scaled to 7,900 schools
initiative (18 million since inception) across 34 cities

5.5+ million 19 young champs

Children, adolescents and youth from 10 states awarded
were reached out through Reliance scholarships this year to develop
Foundation Youth Sports their football skills

DISASTER RESPONSE
Managing and responding to disasters

74,000+ During FY 2018-19, RF promptly

Affected families were helped communities affected
supported in Kerala flood relief by floods and cyclone in Andhra
Pradesh, Kerala, Gujarat,
Odisha, Uttar Pradesh and
Tamil Nadu

ARTS, CULTURE AND HERITAGE

Protection and promotion of India’s art, culture and heritage

Supported the annual concert

'Abbaji' organised by Ustad
Zakir Hussain as part of its arts
and culture initiative

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 37

RELIANCE IN OUR LIVES
Everytime. Everyday!

GOOD MORNING! GETTING TO WORK MEALS

• Recron – Mattresses, pillows • R|Elan™ A fabric that can be used across • Reliance Fresh – Fresh fruits and
and blankets apparel segments such as activewear, and vegetables, food, groceries and items of
• Relwood – Superior wood denim, ethnic and western wear, both daily use
substitute for indoor and formals and casuals • Reliance SMART – Fresh fruits and
outdoor furniture • Only Vimal – Suitings, shirtings and vegetables, food, clothing, footwear,
readymade garments electronics and general merchandise
• Reliance Trends – A wide range of apparels, • Reliance Gas – Domestic, commercial
handbags, footwear and accessories and industrial fuel
• Reliance Footprint – Speciality stores
dealing in footwear, luggage, handbags and
accessories

ENTERTAINMENT PARTIES AND CELEBRATIONS BACK HOME

• Viacom18 Motion Pictures – For full- • Reliance Jewels – Premium jewellery • JioTV – Live and Catch up TV on the move
length feature films within India chain offering a wide range of fine • JioSaavn – Large library of songs across
• Entertainment channels – Colors, MTV, jewellery across gold, silver, diamond various languages and genres accessible
VH1, Comedy Central, History TV18, Sonic among others anytime, anywhere
and MTV Beats • Project EVE – Speciality stores catering • JioCinema – Library of movies, TV shows,
• BookMyShow – Online ticket booking for to entire fashion and lifestyle needs of music videos and content across 11
movies, plays, sporting events and shows women languages and genres on phone, tablet,
TV and website

38 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

GETTING UP TO SPEED CONVENIENT COMMUTE DIGITISING WORK

• Network18 – News content • Reliance Petroleum Retail – • JioCloud – Store and access files from
through multiple channels in Transportation fuel for daily commute anywhere
multiple languages • Qwikmart – Convenience stores for • JioSwitch – Easy-to-use data transfer
• JioNews – Multiple daily shopping of beverages, snacks and gifts application for secure transfer and
newspapers/magazines on highways sharing of a wide range of files
from multiple Indian and • Reflex – Polymers and elastomers in tyres • JioMoney – Digitising everyday consumer
international cities and Automobiles transactions – simple, smart and secure
payments
• Jio4GVoice – HD voice and video calls,
and SMS

THE EVENING BREAK LUNCH TIME UPDATING KNOWLEDGE

• Relpet – Packaging for bottled water, • Repol – Containers for carrying food and • Moneycontrol – Comprehensive financial
beverages, confectionary, food beverages information, and news and in-depth
products among others • Relene – Containers and carrier bags for analysis of various sectors, industries and
• JioChat – Free chat, SMS, voice and carrying food and beverages businesses.
video calls • Forbes India – Magazine for financial/
business news and analysis

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 39

AWARDS AND ACCOLADES

Awarded Digital Icon of the Year 19th National Award for Excellent Energy-efficient Unit

LEADERSHIP QUALITY CAPITAL RESOURCES

• Shri Mukesh D. Ambani is among '100 • 'Quality Circle -Lakshya' from HDPE • 'Best Syndicated Loan' and 'Issuer of the
Most Influential People' as per TIME Plant, 'Udaan' of QC department, and Year – Corporate (South Asia)' by The
magazine for 2019 'Prayas' from CCPP Plant was awarded Asset
• Shri Mukesh D. Ambani received the with the highest category 'Gold Award' • 'Best ECA-backed Telecoms Finance
'Digital Icon of the Year' Award at the at the 6th Annual Convention on Quality Deals of the Year' by Trade and Export
Drivers of Digital Awards 2018 Concepts Finance (TXF) for its K-Sure supported
• Shri Mukesh D. Ambani is among • 'Quality Circle- Jazbaa' from QC ECA financing of $825 million and
the 'Top 100 Global Thinkers' for department was awarded with the €150 million
accelerating a smartphone internet highest category 'Gold Award' at • IFR Asia – Issuer of the Year award
revolution in the world's largest International Convention on Quality • Finance Asia – Issuer of the Year award
democracy as per Foreign Policy Control Circles (ICQCC 2018) at • The Asset Triple A – 'Best Trade Finance
magazine Singapore Solution', 'Best Supply Chain Solution'
• Shri Mukesh D. Ambani ranked 24th in and 'Treasurer of the Year'
Fortune list of '50 Greatest Leaders in the ENERGY AND WATER CONSERVATION/
World' EFFICIENCY HEALTH, SAFETY AND ENVIRONMENT
• Shri Mukesh D. Ambani is India's top • Won CII’s 'Excellent Energy-efficient • Received the 'Safety Innovation Award
philanthropist, according to the Hurun Unit' award at the '19th National Award 2018' from the Institution of Engineers
India Philanthropy List 2018, which is a for Excellence in Energy Management (India), Delhi State Centre
ranking of the most generous individuals 2018 • Awarded 'The APEX India Afforestation
from India • Won the 'Making India Energy Efficient' Excellence Award 2017' under Platinum
award for the year 2018 at Future of category
HUMAN RESOURCES Energy Management Summit, Mumbai. • Awarded 'Platinum Award' for
• Received Tata Institute of Social outstanding achievement in the field
Sciences (TISS) Leap Vault CLO (Chief TECHNOLOGY, PATENTS, R&D AND of Environment Management in Textile
Learning Officer) award in 2018 for 'Best INNOVATION Sector at the 18th Annual Greentech
Leadership Development Programme' • Received the 'North American Environment Award 2018
• Ranked 10th position in the 'LinkedIn Top Maintenance Excellence Award 2018' • Awarded 'International Safety Award'
Companies: Where India Wants to Work by the Foundation of Industrial with 'Merit from British Safety council'
Now' Maintenance Excellence, Florida, US • Awarded 'Platinum Award' at Grow Care
• Ranked in the India's Top 25 'Best • Won Best Innovative Project Award for India Safety Awards 2018
Companies to Work For' in the Business 'Acid Free Cooling Water Treatment • Won the 'Annual Greentech Gold
Today–People Strong Survey 2019 Program' Safety Award 2018' at the 17th Annual
• Won the highest 'Gold Award' at Greentech Foundation, New Delhi
ICCQC - 18 at Singapore for case study • Received 'HSE Award – Platinum
on 'Improving performance of 51/14 Category for the Year 2017-18'–the
denier'. highest among the three categories
• Won the "Shram Shree Award" from the (Platinum, Gold and Bronze) given by
state of Gujarat for special contribution the National Safety Council
to enhancing throughput of CP

40 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

Asia Sustainability Reporting Awards 2018 Retail Jeweller India Awards 2018 Annual Greentech Gold Safety Award 2018

CORPORATE SOCIAL RESPONSIBILITY • Winner of 'Sustainability Category' at • Reliance Jewels won 'Innovative
• Won the award from the Ministry of the 5th Edition of Aditya Birla Group: Marketing Campaign of the Year 2018'
Rural Housing and Information and 'Manufacturing Today: Reinventing The award at Gem and Jewellery Trade
Broad Casting, Government of Andhra Future' at Vadodara Council of India (GJTCI) Awards
Pradesh, on contribution made under • Reliance Foundation received 'Olive • Reliance Jewels won award for the TV
CSR activities in the East Godavari Crown Press Corporate – Silver Award' Campaign of the Year at the 14th FURA
District and vicinity areas of KG D6. at the International Advertising Retail Jeweller India Awards 2018
• Won CSR Award 2018-19 'Ek Kaam Desh Association’s India Chapter 2019 for • Petro Retail won the prestigious
Ke Naam' for the initiative 'Women creative excellence in communicating Federation of Indian Petroleum Industry
Empowerment through Skilling: sustainability for the second consecutive (FIPI) award for Digitalisation Initiatives
Transforming human into human year in the Oil and Gas Sector – Company of
resource'. the Year 2017
• Reliance Foundation won the 'Social RETAIL • Petro Retail won 'Gold award' from
Contributors' award at Pitch Top 50 • Reliance Fresh rated as India's 'Most Brandon Hall, US, for 'Product Loss
Brands Trusted Grocery Brand' in the Brand Training' case study under the
Trust Report category of 'Best Results of a Learning
SUSTAINABILITY • Reliance SMART won 'Rapid Expansion Programme' for 2018
• Won the 'Apex National Award for with SMART Hyper Model' award at
Manufacturing Competitiveness' (NAMC) IMAGES South India Retail Awards 2018 DIGITAL SERVICES
2018 under the Gold category • Reliance Digital awarded 'National • Jio ranked No. 1 in the 'Fortune Change
• Received 'Sustainability Award' for the Retailer of the Year' by India Retail and the World 2018 Top10' list
Best Green Process in Petrochemical e-Retail Awards 2018 • Jio won the 'Best Mobile Operator
Sector by FICCI • Reliance Digital received 'Most Admired Service for Consumers' award at the
• Received 'Asia’s Best Community Consumer Electronics Retailer of the Global Mobile GLOMO Awards 2018
Reporting Award' at Asia Sustainability Year' at IMAGES Retail Awards 2018 • Jio TV app won the 'Best Mobile Video
Reporting Awards • Reliance Digital received 'Best Use of Content' award at GLOMO Awards
• Won the 'Best Sustainable Corporate of Social Media in Marketing' at National • Jio was awarded the ‘Most Innovative
the Year 2018' at the Sustainability 4.0 Marketing Excellence Awards 2018 Company’ award by Economic Times
Awards by Frost and Sullivan and TERI (Times Network) • Jio was awarded the ‘Most Innovative
• Won the 'Sustainable Corporate of the • Reliance Digital received the following Company - JioSaavn’ award by Fast
Year Award – 1st Runner-up' 2019 at the awards for excellence at the ACEF Asian Company
Sustainability 4.0 awards by Frost and Leadership Award 2018: • Jio was awarded the ‘Most Innovative
Sullivan and TERI Gold for Grand Prix Award for the Company - Value-added Services’ award
• Won the 'CII-ITC Sustainability Awards 'Most Admired Brand of the Year' by Aegis Graham Bell
2018' Silver for 'Excellence in Brand • Jio earned the 17th spot on the global
• Won the 'India Green Manufacturing Awareness' list in American business magazine
Challenge (IGMC) Gold Medal Award • Project Eve was awarded the 'Most Fast Company’s 50 Most Innovative
2018' from International Research Admired Retail Launch' of the year by Companies list 2018
Institute for Manufacturing, India IMAGES Retail Awards

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 41

AWARDS AND ACCOLADES (CONTD)

Sustainability 4.0 Award by Frost & Sullivan and TERI Golden Peacock Award

• Won 'The Disruptor Award' from Indian Sector' award at Global Marketing MEDIA
Leadership Awards Excellence • CNBC TV18 and CNBC Awaaz were the
• Jio was awarded 'India’s Most Influential • Jio Cricket Play Along won the No. 1 in English and Hindi businesses,
Brands by IPSOS' 'Marketing Excellence in Sports respectively, in the news genre
• Jio KBC won the 'Best Mobile Game Marketing' award at Global Marketing • Nickelodeon is the No 1. Channel in the
Used for Marketing' Award at Indian Excellence kid’s category since August 2014
Digital Awards (IAMAI) 2018 • Jio Interact was awarded the 'Brand • CNBC Awaaz awarded 'Best Business
• Jio won the 'AFAQS India's Buzziest Excellence in Telecom Sector' at ABP Channel on International Commodities
Brand 2018' award across India in all Brand Excellence in Marketing awards Coverage' by Commodity Participants
categories • Jio Cricket Play Along won the award for Association of India (CPAI) 2018
• Jio for Swachhata won award for content marketing at ET Now Stars of • CNBC Awaaz awarded 'Leader in Hindi
'Marketing Strategy – Social Connect' at the Industry Awards Business News' by IMWBuzz TV-Video
Maddies 2018 • Jio Phone won the 'Best New Brand, Summit and Awards 2018
• Jio Cricket Play Along won award Product and Service Launch' award at • Talk show 'Bollywood Roundtables' won
for 'Channel/Media Strategy–Mobile ET Now Stars of the Industry Awards 'Best Talk Show 2018' at Asian Television
Applications' at Maddies 2018 • Jio KBC was awarded the 'Marketing Awards
• Hall of Fame won the 'Mobile Marketer Campaign of the Year' award at ET Now • Mr. Zakka Jacob won 'The Best News
of the Year' 2018 award at Maddies 2018 Stars of the Industry Awards Presenter' 2018 at Asian Television
• Jio Interact won awards for 'Brand • Jio Interact won the award for Marketing Awards
Campaign–Category Creation' and 'Excellence in Telecom Sector' at ET Now • Abby Awards – Viacom18 won the title
'Innovative Use of Technology Sector' at Stars of the Industry Awards of ‘Creative Company of the Year’ on the
Indian Marketing Award 2018 • Jio Cricket Play Along won the 'Best back of its work for MTV
• JioPhone won the 'Best Low-cost Consumer Mobile Service' award at • Media 360 Awards 'Best Use of
Smartphone' award at Mobby’s Indian Digital Awards(IAMAI) Experiential Marketing' –
Awards 2018 • Jio Cadbury’s Generosity Campaign won Dance Deewane (Viacom18)
• Jio Interact won the 'Best Use of Digital the 'Best Brand Awareness Campaign' • E4M Prime Time Awards – 'Best Program
Media in Marketing and Advertising' using mobile award at Indian Digital Promotion Strategy' – Single Medium –
Award at Mobby’s awards 2018 Awards (IAMAI) Bigg Boss 11 (Viacom18)
• Jio won the 'Disruptor of the Year', • Jio Interact won the 'Best Use of Bot'
'Digital Strategists' and 'Bottom of the award at Indian Digital Awards (IAMAI)
Pyramid' awards in Pitch Top 50 Brands • Jio Interact – 102 Not Out won the 'Best
• Jio KBC won the 'Best Integrated Use of Native Advertising' at Indian
Branded Content' and 'Best Use of Digital Awards (IAMAI)
Mobile Medium for Marketing' awards at
Indian Content Marketing Awards
• Jio Interact won the 'Marketing
Excellence in Telecom, Energy & Utility

42 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements

COMPANY INFORMATION
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

BOARD OF DIRECTORS COMMITTEES BANKERS MAJOR PLANT

LOCATIONS
Chairman and Managing Audit Committee Allahabad Bank
Director Yogendra P. Trivedi (Chairman) Andhra Bank Dahej Manufacturing
Mukesh D. Ambani Dr. Raghunath A. Mashelkar Bank of America N.A. Division
Adil Zainulbhai Bank of Baroda P. O. Dahej,
Independent Directors
Raminder Singh Gujral Bank of India Taluka: Vagra,
Mansingh L. Bhakta
Bank of Maharashtra District Bharuch - 392 130,
Yogendra P. Trivedi Stakeholders’ Relationship
Canara Bank Gujarat, India
Prof. Dipak C. Jain Committee
Central Bank of India
Dr. Raghunath A. Mashelkar Yogendra P. Trivedi (Chairman) Hazira Manufacturing
Citibank
Adil Zainulbhai Arundhati Bhattacharya Division
Credit Agricole Corporate and
Raminder Singh Gujral Nikhil R. Meswani Village Mora,
Investment Bank
Dr. Shumeet Banerji Hital R. Meswani P. O. Bhatha, Surat-Hazira Road,
Corporation Bank
Arundhati Bhattacharya Surat - 394 510,
Risk Management Deutsche Bank
Gujarat, India
Non Independent Director Committee The Hong Kong and Shanghai
Nita M. Ambani Adil Zainulbhai (Chairman) Banking Corporation Limited Jamnagar
Dr. Shumeet Banerji HDFC Bank Limited Village Meghpar/Padana, Taluka
Executive Directors
Hital R. Meswani ICICI Bank Limited Lalpur, Jamnagar - 361 280,
Nikhil R. Meswani
P. M. S. Prasad IDBI Bank Limited Gujarat, India
Hital R. Meswani
Alok Agarwal Indian Bank Jamnagar SEZ Unit Village
P. M. S. Prasad
Srikanth Venkatachari Indian Overseas Bank Meghpar/Padana, Taluka
Pawan Kumar Kapil
Oriental Bank of Commerce Lalpur, Jamnagar - 361 280,
Finance Committee
Chief Financial Officer Punjab National Bank Gujarat, India
Mukesh D. Ambani (Chairman)
Alok Agarwal Standard Chartered Bank
Nikhil R. Meswani KG D6 Onshore Terminal
State Bank of India
Joint Chief Financial Officer Hital R. Meswani Village Gadimoga,
Syndicate Bank
Srikanth Venkatachari Tallarevu Mandal,
Human Resources, Union Bank of India
East Godavari District – 533 463,
Auditors Nomination and Vijaya Bank
Andhra Pradesh, India
D T S & Associates Remuneration Committee
S R B C & CO LLP Adil Zainulbhai (Chairman) Nagothane Manufacturing
Yogendra P. Trivedi REGISTRARS & Division
Group Company Secretary
Dr. Raghunath A. Mashelkar TRANSFER AGENTS P. O. Petrochemicals Township,
and Chief Compliance
Raminder Singh Gujral Karvy Fintech Private Limited, Nagothane - 402 125, Roha
Officer
Dr. Shumeet Banerji Karvy Selenium Tower B, Taluka, District Raigad,
K. Sethuraman
Plot 31-32, Gachibowli, Maharashtra, India
Corporate Social
Joint Company Secretary Financial District,
Responsibility and Patalganga Manufacturing
and Compliance Officer Nanakramguda,
Governance Committee Division
Savithri Parekh Hyderabad 500 032, India
Yogendra P. Trivedi (Chairman) B-1 to B-5 & A3, MIDC Industrial
Tel: +91 40 6716 1700
Solicitors & Advocates Dr. Raghunath A. Mashelkar Area, P. O. Rasayani, Patalganga
Toll Free No.: 1800 425 8998
Kanga & Co. Dr. Shumeet Banerji – 410 220, District Raigad,
Fax: +91 40 6716 1680
Nikhil R. Meswani Maharashtra, India
e-mail: [email protected]
REGISTERED OFFICE Health, Safety and Website: www.karvy.com Vadodara Manufacturing
3rd Floor, Maker Chambers IV, Environment Committee Division
222, Nariman Point, Hital R. Meswani (Chairman) P. O. Petrochemicals,
Mumbai 400 021, India Dr. Raghunath A. Mashelkar Vadodara - 391 346,
Tel: +91 22 3555 5000 Arundhati Bhattacharya Gujarat, India
Fax: +91-22-2204 2268 P. M. S. Prasad
+91-22-2285 2214 Pawan Kumar Kapil
e-mail: [email protected]
Website: www.ril.com

42nd Annual General Meeting (Post-IPO) on August 12, 2019 at 11:00 a.m. at Birla Matushri Sabhagar, 19, Sir Vithaldas
Thackersey Marg, Near Bombay Hospital & Medical Research Centre, New Marine Lines, Mumbai 400 020

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 43

PRODUCT FLOW CHART
A diverse set of products
and end applications NATURAL
GAS

Light ends
Refinery C4 Offgas Propane Naphtha LPG Gasoline

BUTYL RUBBER Ethane/Propane Ethane

Jamnagar Expansion Project

Ethylene Propylene C4's C6+
Refinery C4
Butene-1 PP
EDC MTBE Benzene
HPIB
HDPE/LLDPE Butene-1 Toluene

Butyl Rubber LDPE Butadiene Xylenes

Halogen
EO
Halobutyl Rubber

VCM
Styrene SBR LAB Orthoxylene

PBR Paraxylene
PVC
DEG/TEG
Normal
Kerosene
Paraffin
Salt

MEG PET PTA

Caustic Chlorine
Acetic Acid

Polyester Chips

Filament Staple PET Bottles

(Recycled)
FDY PSF PFF

POY

PTY
Spun Yarn Non-woven
Applications

Texturised / Filler Products/

Twisted Dyed Yarn Non-wovens/
Technical Textiles
Fabrics

Apparel
Purchased Raw Materials Wool Viscose
Partly Purchased Raw Materials Silk Linen
Existing Products
New Products

44 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

CRUDE
OIL
CBFS Carbon Black feedstock
DEG Di-Ethylene Glycol
EDC Ethylene Di-Chloride
EO Ethylene Oxide
FDY Fully Drawn Yarn
Middle distillate Solids/fuels HDPE High Density Polyethylene
Diesel Jet/Kero Fuel Oil / CBFS Petcoke Sulphur HPIB High Purity Isobutylene
LAB Linear Alkyl Benzene
LDPE Low Density Polyethylene
LLDPE Linear Low-density Polyethylene
LPG Liquefied Petroleum Gas
MEG Mono-Ethylene Glycol
MTBE Methyl Tertiary Butyl Ether
PBR Poly Butadiene Rubber
PET Polyethylene Terephthalate
PETCOKE GASIFICATION PFF Polyester Filament Fibre
POY Partially Oriented Yarn
Jamnagar Expansion Project PP Polypropylene
PSF Polyester Staple Fibre
Pet Coke PTA Purified Terephthalic Acid
PTY Polyester Textured Yarn
Syngas Sulphur PVC PolyVinyl Chloride
SBR Styrene Butadiene Rubber
SNG Synthetic Natural Gas
Hydrogen SNG
TEG Tri-Ethylene Glycol
VCM Vinyl Chloride monomer

RELIANCE COMPOSITE SOLUTIONS

Glass rowing Multiple raw materials
(procured) PTA, EO, Styrene, etc.
(captive / procured)

Resin
Glass Fibre
(Polyester / Epoxy / Phenolic)

Filament Mass Transport Centrifugal

Pultrusion Sheet Molding Wind Mill Unit General Molding
Winding Unit Casting

Product plants

End use applications

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 45

FINANCIAL HIGHLIGHTS
RIL Standalone
(₹ in crore)

US $
FY 2018-19 FY 2017-18 FY 2016-17 FY 2015-16 FY 2014-15 FY 2013-14 FY 2012-13 FY 2011-12 FY 2010-11 FY 2009-10
million
Value of Sales & Services
57,984 4,00,986 3,15,357 2,65,041 2,51,241 3,40,814 4,01,302 3,71,119 3,39,792 2,58,651 2,00,400
(Revenue)
Total Income 57,020 3,94,323 3,13,555 2,73,750 2,59,062 3,49,535 4,10,238 3,79,117 3,45,984 2,61,703 2,02,860
Earnings Before 9,786 67,676 59,961 51,965 47,168 40,323 39,813 38,785 39,811 41,178 33,041
Depreciation, Finance Cost
and Tax Expenses(EBDIT)
Depreciation and
1,527 10,558 9,580 8,465 8,590 8,488 8,789 9,465 11,394 13,608 10,497
Amortisation
Profit For the Year 5,085 35,163 33,612 31,425 27,384 22,719 21,984 21,003 20,040 20,286 16,236
Equity Dividend % - 60 110 - 105 100 95 90 85 80 70
Dividend Payout 514 3,554 3,255 - 3,095 2,944 2,793 2,643 2,531 2,385 2,084
Equity Share Capital 917 6,339 6,335 3,251 3,240 3,236 3,232 3,229 3,271 3,273 3,270
Reserves and Surplus 57,694 3,98,983 3,08,312 2,85,062 2,50,758 2,12,923 1,93,842 1,76,766 1,62,825 1,48,267 1,33,901
Net Worth 49,762 3,44,128 3,13,114 2,83,288 2,53,998 2,16,159 1,97,074 1,79,995 1,66,096 1,51,540 1,37,171
Gross Fixed Assets 68,916 4,76,591 4,52,492 4,30,093 3,93,117 3,11,815 2,64,281 2,32,270 2,05,493 2,21,252 2,28,004
Net Fixed Assets 45,513 3,14,745 3,00,447 2,87,319 2,58,448 1,90,316 1,51,122 1,28,864 1,21,477 1,55,526 1,65,399
Total Assets 1,12,175 7,75,745 6,17,525 5,46,746 4,81,674 3,97,785 3,67,583 3,18,511 2,95,140 2,84,719 2,51,006
Market Capitalisation 1,24,936 8,63,996 5,59,223 4,28,909 3,38,703 2,66,847 3,00,405 2,49,802 2,44,757 3,42,984 3,51,320
Number of Employees 28,967 29,533 24,167 24,121 24,930 23,853 23,519 23,166 22,661 23,365
Contribution to National
9,774 67,589 56,997 51,399 43,117 33,322 31,374 28,950 28,197 28,719 17,972
Exchequer

Key Indicators
US $ FY 2018-19 FY 2017-18 FY 2016-17 FY 2015-16 FY 2014-15 FY 2013-14 FY 2012-13 FY 2011-12 FY 2010-11 FY 2009-10
Earnings Per Share - (`) 0.80 55.5* 53.1* 96.9 84.6 70.2 68.0 64.8 61.2 62.0 49.7
[excluding Exceptional item]
Turnover Per Share - (`) 9.15 632.6* 497.8* 817.2 775.3 1,053.3 1,241.7 1,149.5 1,037.8 790.5 612.9
Book Value Per Share - (`) 9.25 542.9* 496.7* 889.0 784.4 668.0 609.8 557.5 507.3 463.2 419.5
Debt : Equity Ratio 0.40:1 0.37:1 0.37:1 0.42:1 0.45:1 0.45:1 0.40:1 0.41:1 0.44:1 0.46:1
EBDIT / Gross Turnover % 16.9 19.0 19.6 18.8 11.8 9.9 10.5 11.7 15.9 16.5
Net Profit Margin % 8.8 10.7 11.9 10.9 6.7 5.5 5.7 5.9 7.8 8.1
RONW % ** 13.7 15.5 17.1 15.1 13.4 12.9 12.8 13.4 15.5 16.4
ROCE % ** 24.9 28.7 25.4 17.2 12.7 11.5 11.2 11.6 13.2 13.9
In this Integrated Annual Report, $ denotes US$, unless otherwise stated
US$1 = `69.155 (Exchange rate as on 31.03.2019)
* Adjusted for issue of Bonus Shares in 2017-18 in the ratio of 1:1
** Adjusted for CWIP and revaluation

46 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements

MANAGEMENT DISCUSSION AND ANALYSIS

2 ‒ 40 41 ‒ 179 180 ‒ 285 286 ‒ 425 426 ‒ 450

INSIDE THIS SECTION

YEARLY REVIEW
48 OVERVIEW
Refining and Retail
Macro environment – global and
Marketing PAGE 80
domestic
PAGE 54
49 HIGHLIGHTS AND KEY EVENTS
Brief overview of business
performance and other events
during the year
Petrochemicals Digital Services
52 FINANCIAL PERFORMANCE PAGE 62 PAGE 90
AND REVIEW
Financial information (consolidated
and standalone) and discussion on key
parameters
54 BUSINESS PERFORMANCE Oil and Gas Media and
Analysis and description of all major Exploration & Entertainment
business segments of Reliance Production PAGE 100
covering strategic advantages and PAGE 72
competitive strengths. The discussion
structure covers the environment
the business operates in and how 108 LIQUIDITY AND CAPITAL RESOURCES
Reliance’s business model and Insights including Reliance’s financing strategy, resource
operational excellence helped achieve raising, capital and risk management framework
a strong overall financial performance.
In addition, growth plans and strategy
is elaborated for each business
segment

SUSTAINABLE FUTURE & GROWING RESPONSIBILITY

110 SUSTAINABLE GROWTH AT 158 Reliance's Sustainability
Natural Capital and Climate Change
RELIANCE – THE INTEGRATED Reporting Journey
PAGE 112
APPROACH
162 RISK AND GOVERNANCE
Analysis and disclosure of Reliance’s
Human Capital and People Connect
approach towards sustainable and 169 GLOSSARY
PAGE 120
responsible growth through the lens
of International Integrated reporting
Manufactured Capital and
<IR> Framework, SDG, PMO’s initiatives
Product Stewardship
supported by the NITI Aayog and
PAGE 132
beyond. It reflects performance and
outcome, stewardship, and inter-
dependencies for the broad base of Intellectual Capital and Innovation
capitals (natural, human, intellectual, PAGE 140
manufactured, financial, social and
relationship) and communicates
Financial Capital and Credit Rating
the factors that materially affect the
PAGE 148
ability to create value over time - short,
medium and long-term
Social and Relationship Capital
110 Strategic Framework
PAGE 150
110 The Integrated Approach

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 47

MANAGEMENT DISCUSSION AND ANALYSIS

Forward-looking Overview
Statement GLOBAL
The report contains forward-looking Global economic growth remained healthy The economy continued to witness an
statements, identified by words like ‘plans’, at 3.6% in CY 2018, as against 3.8% in increase in investments, with Gross Fixed
‘expects’, ‘will’, ‘anticipates’, ‘believes’, CY 2017, impacted by weaker performance Capital Formation growth at a six-year-
‘intends’, ‘projects’, ‘estimates’ and so on. in the European Union and China. This high of 10%. Healthy industrial activity
All statements that address expectations was driven by a boost in spending due to continued, and services indicators
or projections about the future, but not tax cuts by the United States, which grew sustained positive trends with services
limited to the Company’s strategy for at 2.9%, equalling its decade-high growth credit, air traffic growth, and commercial
growth, product development, market achieved in 2015. Global trade growth was vehicle sales clocking double digit growth.
position, expenditures and financial robust in the first half of 2018, as oil prices Services exports growth at 17%, is at
results, are forward-looking statements. rallied due to the impending re-imposition a seven-year-high. With continuing
Since these are based on certain of sanctions on Iran by the United policy initiatives, India moved to the 77th
assumptions and expectations of future States along with continuing declines in rank from 100th, in terms of ease of
events, the Company cannot guarantee production in Venezuela. Trade tensions doing business.
that these are accurate or will be realised. and imposition of tariffs saw front loading
For FY 2018-19, India’s oil demand grew
The Company’s actual results, performance of imports in 2018.
at about 3% y-o-y with consumption-led
or achievements could thus differ from
Global trade weakened towards the end demand growth in gasoline (+8.1%), gasoil
those projected in any forward-looking
of 2018 partly due to the impact of tariff (+3.0%) and jet fuel (+9.1%). The demand
statements. The Company assumes no
increases in the United States and China was driven by robust growth in commercial
responsibility to publicly amend, modify
and higher energy prices. The global trade vehicle sales and strong air traffic growth
or revise any such statements on the basis
slowdown was led by a sharp deceleration during the year. On the rural side, tractor
of subsequent developments, information
in import demand in emerging markets. sales and three-wheeler sales declined
or events. The Company disclaims any
Given relatively weaker growth outlook, from the highs of FY 2017-18, but continued
obligation to update these forward-looking
China is implementing a stimulus package to grow in double digits. Domestic demand
statements, except as may be required by
and the United States Fed has indicated a growth for petrochemical products was
law.
pause in the monetary policy tightening healthy with both polymer and polyester
cycle. These policy support measures could demand growing at 7.0% y-o-y.
potentially help offset growth weakness in
India continues to embrace the digital
the European Union, and be supportive for
life. Reliance Jio has propelled India to
global demand and commodity prices in
become the largest mobile data consuming
the near term.
economy in the world. With ubiquitous
Higher oil prices had an impact on demand and reliable data services, data networks
across the hydrocarbon chain, with global are increasingly being used for media
oil demand growth slowing to and entertainment, education, market
1.2 mbpd in 2018 from 1.5 mbpd in 2017. information and for transactions among
Key petrochemical feedstock Ethylene other use-cases. Adoption of digital
demand growth in 2018 also slowed to transactions witnessed exponential growth.
3% y-o-y v/s 5.5% growth in the previous UPI payments grew from 0.7% of GDP in
year. Volatility in feedstock prices, muted FY 2017-18 to 4.7% in FY 2018-19, while
demand and incremental supply from new credit card growth averaged a strong 32%
capacities led to a challenging environment y-o-y in FY 2018-19.
for businesses in the energy chain.
Personal consumption trends remain
strong with personal credit at a
INDIA
healthy 18% y-o-y, reflective of the
Indian economy remained the fastest
strength in India’s consumption cycle.
growing major economy in the world in CY
Reliance Retail continues to benefit from
2018. In FY 2018-19, the estimated Gross
strong demand growth across consumer
Domestic Product growth rate is 6.8%,
staples and discretionary goods and its
driven by strong private consumption
ability to deliver a superior customer
growth at 8.1%.
experience and value proposition.

48 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

Highlights and Key Events

FY 2018-19 marked the coming of age of among mobile telecom operators in the
Reliance’s consumer businesses. From a country, by Adjusted Gross Revenue (AGR).
mere 2% EBITDA contribution in
Another key pillar of growth during the year
FY 2015-16, consumer businesses now
was the organised retail business, which
account for 24.6% of RIL’s consolidated
crossed the `1,00,000 crore milestone and
EBITDA. During the year, RIL’s segment
achieved record EBITDA of `6,201 crore.
EBITDA grew by 23% to `87,640 crore, led
Reliance Retail continued accelerated
by record earnings from petrochemicals,
expansion of its nation-wide footprint and
digital services and retail businesses.
operationalised 2,829 stores during the
Petrochemical business achieved record year, crossing the 10,000 stores milestone.
EBITDA of `37,645 crore, up 45.6% y-o-y. With 306.7 million mobile data
This was led by record production volume REFINING & MARKETING – WEAK subscribers, Reliance Jio has
of 37.7 MMT and a strong polyester chain LIGHT DISTILLATE CRACKS LEAD propelled India to become the largest
margin environment. Petrochemical DOWN MARGINS mobile data consuming market
earnings demonstrated the earnings During the year, benchmark Brent oil prices in the world.
power of the new plants commissioned were up 22% due to geo-political tensions,
over the last investment cycle, unmatched supply disruptions from Venezuela, Iran
integration and feedstock flexibility. and Libya as well as OPEC+ production
cuts. Demand growth was impacted by the
Refining business was impacted by weak
high pump level prices in the US and other
light distillate cracks and volatile crude
economies, along with slower growth in
price environment. During the year, all
the Chinese economy. Global oil demand
units of the Gasification complex were
growth slowed down to 1.2 mbpd, leading
started safely and are currently under
to supply-demand mismatch in products
stabilisation.
like gasoline resulting in significant margin
Reliance Jio continues to add subscribers erosion. Reliance Retail crossed the milestone
at a rate unprecedented in the telecom of turnover of `1,00,000 crore during
RIL’s gross refining margins declined to
or technology world. With 306.7 million FY 2018-19.
US$9.2/bbl led by weak light distillate
mobile data subscribers, Jio has been the
cracks, which was only partially offset
key catalyst in the creation of a broadband
by resilient middle distillate cracks.
data market in India and is now ranked #1

LLDPE facility at Refinery Off–Gas Cracker (ROGC) complex, Jamnagar

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 49

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Operational excellence and flexibility RELIANCE RETAIL – Jio is aiming to provide global standard
helped Reliance maintain a significant GROWTH ACROSS ALL KEY wireline infrastructure and services in India
US$4.3/bbl premium over the regional CONSUMPTION BASKETS through its FTTH and Enterprise offerings.
benchmark – Singapore Refining Margins. Reliance Retail achieved record turnover of To accelerate this rollout, RIL has made
The resilient performance by Reliance’s `1,30,566 crore, up 88.7% y-o-y. Turnover strategic investments in Hathway
refining business was supported by growth was driven by rapid store expansion Cable and Datacom Limited and DEN
proactive crude sourcing, optimising of and robust growth in same-store-sales. Networks Limited.
product yields and robust risk management
Reliance Retail achieved its highest ever Jio also continues to execute on its plans
in a challenging environment.
EBITDA of `6,201 crore, up 145% y-o-y. of building a digital ecosystem spanning
The strong operating performance was across media and entertainment,
PETROCHEMICALS – RESILIENT
driven by 100 bps improvement in EBITDA commerce, education, healthcare and
BUSINESS MODEL SHINING
margin to 4.7%. agriculture.
THROUGH
Petrochemicals business delivered its Continuing strong growth momentum,
MEDIA – STRENGTHENING
best ever performance, with EBITDA Reliance Retail has achieved revenue CAGR
OFFERING AHEAD OF EVOLVING
contribution of `37,645 crore, up 45.6% of 55% and EBITDA CAGR of 76% over the
MARKET TRENDS
y-o-y. Petrochemical production was also at last 5 years.
Reliance is committed to offering
a record high of 37.7 MMT, up 16% y-o-y.
Reliance Retail operated 10,415 retail stores differentiated and relevant media
The strong results were achieved in an in over 6,600 towns and cities covering content for the Indian market as part of
environment of declining utilisation rates an area of 22.0 million sq. ft. as of March its digital services bouquet. As part of
in key product chains with new supply 2019. A record footfall of over 500 million this commitment, Reliance is investing in
ramp-up. This demonstrates the resilience was received during the year, a growth of creation of original content relevant for
of the Reliance business model based on 44% y-o-y. Reliance Retail is now working the evolving trends in media consumption,
deep inter-linkages between refining and on plans to launch a differentiated New to be delivered in a pipe-and-platform-
petrochemical chains, feedstock flexibility Commerce platform, which will enable agnostic manner to India’s diverse
and the wide product portfolio. While millions of small merchants across the populace. Through owned content-engines
polymer chain margins were impacted by country to compete in a digital age. and symbiotic partnerships, Reliance
new supplies out of the US Ethane based is building an extensive media content
crackers, polyester chain profitability DIGITAL SERVICES – STRONG library which will cater to all segments of
continued to be robust led by a strong PTA TRACTION IN SUBSCRIBER the audience, and dovetail with its wide
and PX margins. ADDITION AND USER ENGAGEMENT delivery platforms.
Jio continued its robust growth momentum
With the commencement of ethane Reliance’s flagship media company
during FY 2018-19. Digital Services business
cracking at Nagothane, all the key Network18 continued on its growth
revenue grew by 94.5% to `46,506 crore
components of Reliance’s petrochemical trajectory, and invested in key areas to
and EBIT grew by 176.7% to `8,784 crore.
investment cycle are now fully contributing fill whitespaces or fortify its competitive
This was driven by strong adoption of Jio
to earnings. position. Impetus on identified growth
services, reflected in strong subscriber
areas of vernacular content and digital
addition and usage metrics on data and
OIL AND GAS EXPLORATION & delivery continued during the year, and the
voice. Reliance Jio added 120.1 million
PRODUCTION – NEW PROJECTS TO strength and reach of multiple powerful
subscribers during the year, taking total
START CONTRIBUTING FROM THE brands was extended across regions and
subscriber base to 306.7 million.
NEXT FISCAL YEAR mediums. Growing ad-spends in regional
Reliance is undertaking development Jio is now India’s largest mobile telecom channels (news, led by regional elections
of three ultra-deep / deepwater, High operator ranked by Adjusted Gross Revenue and continued rise of viewership share;
Pressure High Temperature (HPHT) (AGR). Jio leads the Industry in terms of and entertainment, driven by rising
R-Cluster, Satellite- Cluster and D55 (MJ) Average Revenue Per User (ARPU) (`126.2/ consumption and value-perception) was
fields. First gas from R-Cluster is expected month), with healthy average voice a consistent theme for the TV channel
by mid-2020 followed by Satellite Cluster consumption (823 minutes per user per portfolio as well as Digital properties.
and MJ fields over the next two years. The month) and average data consumption
new development will leverage Reliance’s (10.9 GB per user per month). Total data
partnership with BP, existing infrastructure consumption on a monthly basis exceeds
in the Krishna-Godavari Basin and 3 Exabytes in March 2019. Jio has built a
downturn in the capital equipment and video-ready all IP-network as evidenced by
service provider market. video data consumption on the network of
over 500 crore hours per month.
50 Reliance Industries Limited  |  Integrated Annual Report 2018–19
 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

CORPORATE STEWARDSHIP DIGITAL PLATFORMS Advancement and building efficient

Reliance is committed towards promoting During the year, Reliance initiated platform Manufacturing and Service capabilities.
a balanced economic growth and driven organisation processes
INDIAN FILM COMBINE
establishing an inclusive and sustainable to tap significant potential for its
RIL through its wholly-owned subsidiary
growth for all. businesses to improve efficiency and
has acquired majority stake in Indian Film
facilitate informed and agile decision
During FY 2018-19, Reliance contributed Combine, which is building a Drive-in
making process.
`1,16,251 crore to the national exchequer Theatre, Hotel, Retail Mall and Clubhouse at
and `904 crore towards various community Bandra Kurla Complex (BKC) in Mumbai.
REAL ESTATE DEVELOPMENTS
development initiatives focused in the
JIO WORLD CENTRE
areas of rural transformation, health, NMSEZ PROJECT
The Company is also constructing a state-
education, sports for development, disaster RIL entered into a Memorandum of
of-the-art, world-class Convention Centre,
response, arts, culture and heritage and Understanding (MoU) with the Government
Performing art Theatre, Retail Mall, Office
urban renewal. Reliance Foundation has of Maharashtra to develop a Global
space and Clubhouse at Bandra Kurla
touched the lives of 26 million Indians since Economic Digital & Services Hub with
Complex (BKC), Mumbai.
inception. global partnerships. RIL through its wholly
owned subsidiary has entered into an MoU Both these projects are aimed at
The management at RIL follows an
with NMSEZ to sub-lease land of about making BKC the most attractive Retail,
integrated thinking approach which leads
4,000 acres along with the associated Entertainment and Cultural destination
up to six capital approach and helps in
development rights. The Project will usher of Mumbai city along with a much needed
ensuring a sustainable future. Different
the Industry 4.0 Revolution in Maharashtra world-class Convention Centre.
businesses in Reliance foster physical,
and will induce significant Industrial
digital and biological innovations, thus,
growth, not only by offering world class
exhibiting readiness for future megatrends
Infrastructure but also by partnering with
and empowering the fourth industrial
the best of global technology companies
revolution.
in the areas of Innovation and Learning,
Research & Development, Technological

Reliance Retail has achieved revenue The resilient performance by Jio leads the Industry in terms of
CAGR of 55% and EBITDA CAGR of 76% Reliance’s refining business was ARPU (`126.2/month), average voice
over the last 5 years. supported by proactive crude consumption (823 minutes per user per
sourcing, optimising of product yields month) and average data consumption
and robust risk management in a (10.9 GB per user per month).
challenging environment.

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 51

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Financial Performance and Review

Alok Agarwal Srikanth Venkatachari

FINANCIAL INFORMATION – CONSOLIDATED AND STANDALONE

The year was characterised
by volatile macro-economic Particulars Consolidated Standalone
environment. Adding to uncertainty FY 2018-19 FY 2017-18 FY 2018-19 FY 2017-18
were higher oil prices in the first ` in US$ ` in ` in US$ ` in
half of the year and increasing crore in billion crore crore in billion crore
geo-political tensions through the
Value of Sales and Services
year. Reliance achieved its best ever 6,22,809 90.1 4,30,731 4,00,986 58.0 3,15,357
(Revenue)
performance in this environment
PBDIT 92,656 13.4 73,097* 67,676 9.8 59,961
with record contribution from
Cash Profit 64,478 9.3 54,947* 48,485 7.0 46,352
petrochemicals, retail and digital
Segment EBIT 66,222 9.6 51,299* 50,771 7.3 45,121
services businesses.
Net Profit 39,588 5.7 34,988* 35,163 5.1 33,612
Robust operating performance for Cash and Marketable
1,33,027 19.2 78,063 1,12,155 16.2 67,566
the year underscored the strength Securities
of the petrochemicals business that Tangible and Intangible Assets
5,65,840 81.8 5,85,094 3,14,745 45.5 3,00,447
we have reinforced over the last (Excluding Goodwill)
investment cycle. Furthermore, Gross Debt 2,87,505 41.6 2,18,763 1,61,720 23.4 1,16,881
our consumer businesses continue US$1 = `69.155 (Exchange rate as on 31.03.2019)
to scale new heights with industry *Excludes exceptional item of `1,087 crore representing profit from divestment of stake in Gulf Africa Petroleum Corporation
leading metrics. The scalability
of retail and digital services
business platforms has created
REVENUE PROFIT
unprecedented value for all
Reliance achieved consolidated revenue Volume growth in petrochemicals and
stakeholders.
of `6,22,809 crore (US$90.1 billion), rapidly increasing contribution from
At Reliance, we continue to an increase of 44.6%, as compared to consumer businesses led to significant
maintain strong balance sheet with `4,30,731 crore in the previous year. rise in operating profit for the year.
investment grade ratings. Increase in revenue was primarily Operating Profit before other income and
Our scale of energy business on account of volume increase with depreciation increased by 30.8% on a y-o-y
operations and growth catalyst stabilisation of petrochemicals projects basis to `83,918 crore (US$12.1 billion) as
in consumer businesses will help and oil price related increase in realisations compared to `64,176 crore in the previous
deliver superior and reliable returns in the refining and petrochemical products. year. Profit after tax before exceptional
over the long term. The higher volumes in petrochemicals item was higher by 13.1% at `39,588 crore
business are on account of first full year of (US$5.7 billion) as against `34,988 crore in
operations of new petrochemical facilities. the previous year. Relatively lower growth
Reliance’s consolidated revenue was also in profit after tax is mainly due to higher
boosted by robust growth in retail and interest charges and depreciation due to
digital services business, which recorded stabilisation of projects.
an increase of 88.7% and 94.5% in revenue,
respectively as compared to the
previous year.

52 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

SEGMENT REVIEW Segment EBIT was at `8,784 crore for petrochemicals and refining business and
• Refining and Marketing – Revenue the year, with EBIT margin of 18.9% as in the organised retail business.
(including inter segment transfers) against 13.3% in previous year.
Reliance’s Gross Debt was at `2,87,505
increased by 28.7% y-o-y to `3,93,988
OTHER FINANCIAL HIGHLIGHTS crore (US$41.6 billion). This includes
crore (US$57 billion) primarily on
Other Income before exceptional item standalone gross debt of `1,61,720 crore
account of higher crude prices during
was lower at `8,635 crore (US$1.2 billion) and balance in key subsidiaries, including
the year. Segment EBIT decreased by
as against `8,862 crore in the previous Reliance Jio (`67,018 crore), Reliance
19.8% to `19,868 crore (US$2.9 billion),
year, primarily on account of adverse yield Holding USA (`34,848 crore), Reliance
impacted by significantly higher crude
movement. Retail Group (`12,832 crore), Independent
prices, weak product cracks, lower
Media Trust Group (`3,045 crore),
light-heavy differential and unplanned Finance Cost was at `16,495 crore
Hathway Cable and Datacom Limited
shutdown of Fluid Catalytic Cracking (US$2.4 billion) as against `8,052 crore
(`1,973 crore), Reliance Gas Pipelines
(FCC) Unit. GRM for FY 2018-19 stood at in the previous year. The increase was
Limited (`1,379 crore) and Recron Malaysia
US$9.2/bbl, outperforming Singapore primarily on account of commencement
(`1,170 crore).
complex margins by US$4.3/bbl. of digital services business, petrochemical
• Petrochemicals – Revenue (including projects at Jamnagar and higher loan Cash and Marketable Securities were
inter segment transfers) increased balances. at `1,33,027 crore (US$19.2 billion)
by 37.3% y-o-y to `1,72,065 crore resulting in net debt at `1,54,478 crore
Depreciation (including depletion and
(US$24.9 billion), primarily due to (US$22.3 billion).
amortisation) was higher by 25.3% to
higher prices and volumes, which
`20,934 crore (US$3.0 billion) as compared RIL’s standalone Revenue from Operations
reflected full benefits of ROGC and
to `16,706 crore in the previous year, for FY 2018-19 was `4,00,986 crore (US$58
Paraxylene capacity expansion projects.
primarily on account of commencement billion), an increase of 27.2% on y-o-y
Petrochemicals segment EBIT increased
of wireless service business in Reliance basis. Profit after tax was at `35,163 crore
sharply by 51.9% to its highest ever level
Jio. Higher depreciation also reflected (US$5.1 billion) an increase of 4.6% against
of `32,173 crore (US$4.7 billion).
the capitalisation of new projects in the `33,612 crore in the previous year. Basic
• Oil and Gas – Revenues decreased by
petrochemicals business. EPS on standalone basis for the year was
3.8% y-o-y to `5,005 crore. Volumes from
`55.5 as against `53.1 in the previous year.
domestic upstream fields and US shale Basic Earnings Per Share (EPS) for the
were lower on account of natural decline year ended March 31, 2019 was at `66.8
and slowdown in development activity. as against `60.9 in previous year.
Segment EBIT was at `(1,379) crore as Reliance achieved a consolidated
The Board of Directors of the Company
against `(1,536) crore in the previous revenue of `6,22,809 crore, growth of
has recommended dividend of `6.5/- per
year. For the year, domestic production 44.6% from previous year.
fully paid up equity share of `10/- each,
(RIL share) was at 58.9 Bcfe, down
aggregating `4,641 crore (US$671 million),
25.4% y-o-y and in US Shale (RIL share)
including dividend distribution tax.
business was 94.5 Bcfe, down 32.4% Standalone revenue from operations
y-o-y basis. Reliance’s fixed assets (excluding at `4,00,986 crore, growth of 27.2%
• Organised Retail – Revenues grew by goodwill) stood at `5,65,840 crore y-o-y.
88.7% y-o-y to ₹ 1,30,566 crore. Business (US$81.8 billion) as on March 31, 2019. This
PBDIT for FY 2018-19 grew by 145.2% includes RIL Standalone's fixed assets of
y-o-y to ₹ 6,201 crore. EBITDA margins `3,14,745 crore and balance of `2,51,095
improved 100 bps to 4.7% boosting crore in its subsidiaries mainly
operating profitability. Reliance Retail Reliance Jio, Reliance Holding USA and
further consolidated its leadership Reliance Retail.
position and is India’s largest, most
Capital Expenditure for the year ended
profitable and fastest growing retailer.
March 31, 2019 was `1,32,445 crore
• Digital Services – The business recorded
(US$19.2 billion), including exchange
revenues of `46,506 crore, with
rate difference. Capital expenditure
year-end subscribers base at 306.7
was principally on account of the
million. Reliance Jio reported strong
digital services business, projects in the
financial performance for the year.

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 53

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance

Refining and Marketing (R&M)

Hital R. Meswani C Borar Srinivas Tuttagunta P. Raghavendran Harish Mehta Surinder Saini

RIL continued to outperform

Singapore complex margins with a
premium of US$4.3/bbl, significantly
above its 5-year average. It reflects
the robust operational performance,
superior configuration and consistent
high utilisation of refineries at
Jamnagar.
Refining EBIT for the year was
down 19.8% y-o-y at ₹19,868 crore
led by lower GRM of US$9.2/bbl.
The segment performance was
impacted by volatile crude prices
and multi-year low light distillate
product cracks.
Petrochemicals intensity index
further improved with enhanced
integration post commissioning of
paraxylene and ROGC facilities at
Jamnagar. RIL also started up all units
of the Petcoke Gasification project.
On stabilisation, the gasification
complex will reduce supplemental
energy cost significantly. Petcoke
gasification project, is transforming
Jamnagar refinery into a unique
'bottom-less' refinery by converting
refinery residue into syngas.
RIL expanded its domestic fuel
retailing footprint to 1,372 outlets
and maintained industry leading
throughput per outlet.

Aromatics Complex at Jamnagar

54 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

STRATEGIC ADVANTAGES AND COMPETITIVE STRENGTH

BEST-IN-CLASS INCREASING LOGISTICS AND CRUDE SELECTION

PORTFOLIO THE ADVANTAGE SUPPLY-CHAIN AND SOURCING

• Jamnagar site has • On stabilisation, Petcoke • State-of-the-art logistics • Refinery configuration allows
complexity index of 21.1 Gasification complex will infrastructure to support crude portfolio optimisation
• Ability to run a wide basket of reduce supplemental energy the largest refining hub at with changing market
crudes and among the lowest cost significantly while Jamnagar dynamics
cost producers globally ensuring value addition to • Optimises freight costs • Eleven new crude grades
• Strong operational captive Petcoke through opportunistic use of processed, including new
performance with flexible • Debottlenecking of Diesel time charters North American light grades
product slate, selling to Hydro De-Sulphurisation • Global outreach with trading and opportunity crude
highest value markets (DHDS) unit to higher offices and tankages at key grades from Latin America
capacity locations
• Ramp-up of domestic retail
network to 1,372 outlets

MARKET ENVIRONMENT Global oil demand growth was led by

ROBUST OIL DEMAND GROWTH ethane, LPG and middle distillates.
ENABLING MARKET RE-BALANCING AND Demand growth for gasoil was supported
SUPPORTING PRICES by improved economic activity. Gasoline
Global oil demand growth at 1.2 mb/d in demand growth slowed in 2018 impacted
CY 2018 was around the 10-year average by increase in oil prices.
despite higher oil prices. Brent crude oil
Chinese oil demand growth was largely
price at US$71/bbl in CY 2018 was higher by
stable at 0.4 mb/d led by a growth in
30.9% y-o-y. US, China and India accounted
petrochemical feedstock and jet fuel.
for almost all of the global growth at
In China, gasoline demand was largely flat
1.1 mb/d. Oil demand growth in the US
y-o-y due to lower car sales. Diesel demand
was the highest at 0.5 mb/d aided by the
declined in China for 2018 owing to slowing
commissioning of large ethane crackers,
economic growth as well as rising share of
higher shale production as well as firm
natural gas in the energy mix.
economic growth. Growth in China at
0.4 mb/d and in India at 0.2 mb/d was
largely structural and broad based.

Asian Cracks US$/bbl Q1 Q2 Q3 Q4 FY 2018-19 FY 2017-18

Naphtha -1.4 -1.3 -6.4 -7.5 -4.1 0.3
Gasoline 12.1 11.6 4.7 3.7 8.0 14.6
Jet 15.3 14.5 15.6 13.0 14.6 13.3
Gasoil 15.3 15.4 15.8 14.0 15.1 13.3
Acid Gas Removal at Gasification
Fuel Oil -6.0 -4.2 -0.2 -0.9 -2.8 -4.0
Complex at Jamnagar

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 55

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Refining and Marketing (R&M)

NON-OPEC GAINS MARKET SHARE declines in Venezuela and adherence to the SUPPLY DISRUPTION LED BY
Global oil supply grew by 2.6 mb/d in supply restraint deal between OPEC and GEO-POLITICAL DISTURBANCE
CY 2018. Non-OPEC supply grew by 2.7 non-OPEC producers. Supply from Saudi SUPPORTED OIL PRICES
mb/d led by the strong supply growth in Arabia was higher by 0.4 mb/d y-o-y as Brent crude oil prices averaged
North America (2.2 mb/d in the US and 0.4 Saudi Arabia took a larger than mandated US$70.1/bbl in FY 2018-19, higher by
mb/d in Canada). Supply from Russia was cut in 2017. Supply from Venezuela fell 22% y-o-y. Oil prices increased despite
higher by 0.2 mb/d y-o-y while supplies further by 0.6 mb/d in 2018. Supply from significantly higher production from non-
from Mexico declined by 0.2 mb/d y-o-y. Iran for the full year 2018 was lower only OPEC suppliers. Heightened geopolitical
by 0.2 mb/d with US sanctions enforced tensions in the Middle East, sanctions on
OPEC supply contracted by 0.1 mb/d y-o-y
towards the end of the year. Iran, sharp production decline in Venezuela
in CY 2018 as a result of sharp production
and armed conflict in Libya added to the
uncertainty in oil supply.

OIL PRICES (US$/bbl)

80 Jet fuel demand growth remained strong with
 Brent
Aviation Turbine Fuel (ATF) demand growing
 West Texas Intermediate (WTI)
70 3.0% y-o-y aided by robust 6% y-o-y global
 Dubai
international passenger traffic growth and 7%
60 growth in global domestic air travel. Jet fuel
demand in India grew by 9.1% led by 18.6%
50 growth in air traffic in CY 2018.

40 FUEL OIL
Fuel oil demand declined in CY 2018 due to
30 substitution from other fuels. Fuel oil demand
from the power sector continued to be
20 impacted by natural gas substitution in the
Nov-17

Nov-18
May-17

May-18
Aug-17

Aug-18
Dec-17

Dec-18
Sep-17

Sep-18
Oct-17

Oct-18
Mar-17

Mar-18

Mar-19
Jun-17

Jun-18
Jan-17
Feb-17

Jan-18
Feb-18

Jan-19
Feb-19
Apr-17

Apr-18
Jul-17

Jul-18

Middle East and West Asia. Declining heavy

crude oil production (mainly in Venezuela and
FIRM MIDDLE DISTILLATE CRACKS on demand in the US, the largest gasoline Mexico) and lower Latin American refinery
SUPPORTED REFINING MARGINS market in the world, where demand was utilisation reduced the availability of fuel oil.
Singapore and North West European largely flat y-o-y. Growth in China slowed Further, OPEC oil output cut targeted mainly
refining margins were lower y-o-y as sharp after new car sales declined by 3% in towards medium and heavy crude grades and
decline in light distillate cracks weighed on CY 2018. Gasoline demand growth in India continuing refinery upgrades tightened fuel
stronger middle distillate cracks. Refining in FY 2018-19 was strong at 8.1% y-o-y oil supply and boosted fuel oil cracks.
margins in the US Gulf Coast were higher despite higher retail prices.
STABLE DEMAND OUTLOOK, IMO 2020
due to the access to deeply discounted
Middle Distillates IMPLEMENTATION TO SUPPORT REFINING
crude supply from the US as well as from
Middle distillate cracks strengthened in ENVIRONMENT
Canada primarily owing to logistical
FY 2018-19 over the previous year on firm Global oil demand is expected to grow by
constraints for evacuation of crude oil.
global demand growth. Middle distillate 1.3 mb/d in CY 2019 supported by moderating
Middle distillate cracks gained from firm
demand growth accounted for close to oil prices and start-up of petrochemical
economic growth and low inventories
two-thirds of the oil product demand projects in US and China. US crude production
across trading hubs. Refinery utilisation
growth globally. Gasoil demand was is expected to grow sharply in 2019 as well.
edged up in CY 2018 to 82.9% compared to
exceptionally strong in the US aided by
the 5 year average of 81.3% as net refinery Gasoil demand growth is expected to gain
good economic growth as well as higher
capacity addition lagged oil demand from the implementation of stricter marine
shale oil production. Gasoil demand in
growth. fuel sulphur specifications starting January
China however, fell by 4% in CY 2018 as
2020. Gasoline demand growth is expected
Light Distillates the share of natural gas in the energy mix
to recover on moderating oil prices as well as
Light distillate cracks were lower in continues to increase. Gasoil demand in
rising incomes in emerging markets. Global
FY 2018-19 due to moderation in gasoline India was resilient at 3% despite higher
refinery utilisation is expected to ease with
demand growth across key markets as well retail prices. Gasoil demand growth
the addition of large green-field refinery
as higher inventory especially in the US. generally remained firm in other parts of
capacities towards the second half of CY 2019.
Rising oil prices seemed to have an impact the world through CY 2018.

56 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

RIL PREMIUM OVER REGIONAL BENCHMARKS ABOVE 5-YEAR AVERAGE DOMESTIC MARKETING
At US$9.2/bbl, RIL refining margin remained relatively strong even in a volatile market. Market Environment
RIL maintained a significant premium of US$4.3/bbl over the benchmark Singapore In FY 2018-19, the petroleum product
Complex margins. RIL achieved superior refining margins due to optimal secondary unit consumption increased to 212 MMT, growth
utilisation, maximisation of middle distillate yield, dynamic crude sourcing and responsive of 2.7% y-o-y. The industry growth continues
product placement. to be led by transportation fuels with
improving accessibility due to increased
RIL processed 11 new crude grades this year, including new grades from North America and
network penetration, higher automobile
opportunity crudes from Latin America. During the year, 64 different crude grades were
sales and rising disposable income.
processed.
On account of their share, the transportation
Refining Margins vis-à-vis global benchmarks fuels are driving the strong oil demand
Regional Margins (US$/bbl) FY 2018-19 FY 2017-18 FY 2016-17 growth. Gasoline demand grew by 8.1% to
Singapore Complex 4.9 7.2 5.8 28 MMT and Diesel demand grew by 3.0% to
RIL GRM 9.2 11.6 11.0 84 MMT. Growth in demand was facilitated
Rotterdam (Brent) 5.6 6.3 5.3 by expansion of retail network and road
USGC (WTI) 13.6 12.8 8.7 infrastructure. The total number of retail
outlets in India has increased to over 64,624
FINANCIAL AND OPERATIONAL PERFORMANCE as both state owned oil marketing companies
FINANCIAL PERFORMANCE* and private players continue to expand their
network presence.
FY 2018-19 FY 2018-19 FY 2017-18 With the implementation of the ambitious
% Change
(₹ in crore) (US$ in billion) (₹ in crore) Bharatmala and Sagarmala Pariyojana, there
Revenue 3,93,988 57 3,06,095 28.7% is significantly higher government spend
EBIT 19,868 2.9 24,782# (19.8%) on infrastructure development ongoing in
EBIT% 5.0% 8.1% the country. These projects are creating
*consolidated new avenues for network expansion and
#
excludes exceptional item of `1,087 crore representing profit from divestment of stake in Gulf Africa Petroleum will support demand growth of petroleum
Corporation (GAPCO) during FY 2017-18. products in India over medium-term.
FY 2018-19 revenue from the R&M segment increased by 28.7% y-o-y to ₹3,93,988 crore
(US$57 billion), primarily on account of higher average oil prices during the year. Refining
EBIT decreased by 19.8% y-o-y to ₹19,868 crore impacted by volatile crude prices,
multiyear low gasoline and naphtha cracks. Crude throughput for the year was at
68.3 MMT.

REFINERY SALES (In MMT)

FY 2017–18 FY 2018–19

14.5 15.6

42.2 39.1

14.6 17.0

 Export    Captive    Domestic

DTA Refinery at Jamnagar

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 57

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Refining and Marketing (R&M)

Petroleum Retail Business fuels and has already started supplies of Mixing its customer-first approach with
With a countrywide operational network of the same in the National Capital Territory industry-leading practices, RIL will
1,372 fuel outlets, RIL is covering (NCT) and adjoining districts. continue setting higher benchmarks
all the key highways in the country. of customer fueling experience in the
After being the first Oil Manufacturing
At 0.2 Million, customer count enrolled country.
Company (OMC) to rollout dynamic
in RIL’s marquee fleet programme –
pricing regime, RIL has now also become B) Digitisation Strategy
Transconnect, grew by 12.5% during FY
the first OMC to implement Vapor RIL continues leveraging technology to
2018-19. RIL registered industry leading
Recovery System (VRS) at retail outlets exceed service expectations of all RIL's
throughput with innovative loyalty
at all the locations in the mandated internal and external stakeholders.
customer programmes and strong
geographies within stipulated timelines. As a part of RIL's digital transformation,
customer value proposition.
both RIL's Customer Service and
RIL has reinforced its customer value
RIL registered y-o-y growth of 9.1% Technology are rapidly evolving.
proposition by leveraging the unique
in retail Diesel and 21.8% in retail For enabling the same, RIL is working
synergy of RIL’s group companies –
gasoline volume compared to 2.6% and on the opportunities in the Industry 4.0
Reliance Retail and Reliance Jio.
8.1% for industry, respectively. Share of landscape. Next generation technologies
An array of co-located convenience
fleet (trans-connect) sales in the retail such as Artificial Intelligence, Blockchain
stores have already been launched in the
volumes is significantly higher than and Internet of Things (IoT) are the
retail network and company is working
competitors. RIL’s emphasis on quality epicentre of RIL's business improvement
on plans to augment the setup. Jio
and quantity (Q&Q) of Fuels, superior and enhancement initiatives.
connects each of RIL’s outlet through
service and technology enabled value
high end fiber providing best-in-class To augment seamless implementation of
added offerings at the retail outlets have
connectivity which would form the these services in the field, RIL has already
resulted in industry leading throughput.
backbone of RIL’s pioneering proactive initiated the rollout of state-of-art new
'Desh ka Sacha Pump' campaign built
customer service. age fuel dispensers across the network.
around showcasing RIL’s Q&Q proposition
continues to resonate with the customers. To take the fuel delivery to customer’s Empowering customers to monitor
door-step, RIL is working on next their fleet on the go, offering flexibility
A) Operating Strategy
generation business models. Over 260 of 24X7 fund transfer for loading their
RIL serves its family of satisfied
sites are serving diesel in packaged fleet account and introduction of virtual
customers with a unique Q&Q fuelling
containers to non-transport sector in card for enabling quicker transactions
experience through the entire supply
general and telecom sector in particular. continue to resonate well with RIL's key
chain to the Retail Outlets. RIL’s refinery
RIL has all the requisite regulatory customer segment.
is technically equipped to produce BS VI
permits for launching diesel in High
Through its social media channel, RIL
Density Polyethylene (HDPE) packs.
endeavours to work closely with the
last mile customer for getting service
feedback and upgrading the offerings to
meet their expectations.
Petroleum B2B Business
A) HSD – Direct
Bulk Diesel registered a y-o-y growth
of 5.1% in spite of the concerns around
growing electrification. During the year,
RIL registered a y-o-y volume growth
of 21.7% increasing market share to
8.5% despite difficult market conditions
and competition led margin pressure.
Non-railway business registered an
impressive 34% y-o-y growth.
Alongside strengthening railway
business, RIL has also created a strong
foothold in the second largest sector
in the direct HSD segment through the
Reliance petro retail outlet foray in State Transport Undertaking
(STU). Mines, infrastructure and fisheries

58 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

have all showed promising growth on the JAMNAGAR SUPERSITE HAS shall be eliminated for chemicals at initial
back of focused sector specific operating COMPLEXITY INDEX OF 21.1 stage. Final fuel de-risking shall target
strategy. Complexity index (CI) designates the elimination of gasoline, alkylate and diesel,
capabilities of a refinery to upgrade synchronised to the global evolution of
Growth in HSD – Direct sales volume
lowest quality crude to the highest quality E-mobility and transport fuel demand
would be driven by getting higher
refinery products, including fuels and decline.
volume share in STUs, designing unique
petrochemicals. Complexity index of
operating models for fisheries and mines In summary, the Jamnagar supersite shall
Jamnagar supersite, as per KBC, a global
along with strengthening presence in the continue to maintain a pre-eminence in
refinery consultant, has increased from
Southern markets. Reliance’s revenues and earnings, with the
earlier 12.7 to 21.1 or a 66.1% boost
oil-to-chemical growth plan.
B) Aviation Turbine Fuel (ATF) with the start-up of Jamnagar expansion
With a double digit growth for over 50 projects, including ROGC and downstream Market outlook
consecutive months, at a growth rate units, Paraxylene complex and Petcoke With expectations of global petrochemicals
of 18.6% in 2018, India is the fastest Gasification complex. RIL’s Jamnagar demand growing at a faster rate as
growing domestic aviation market in supersite ranks 1st in the world in compared to transportation fuels in longer
the world for the 4th consecutive year. complexity barrels, aided by best-in-class term, some companies are investing to
Demand for aviation fuel grew at 9.1% Refinery and Petrochemicals integration. integrate refinery to petchem to maximise
y-o-y in FY 2018-19. RIL achieved y-o-y yields of petrochemicals from every barrel
OIL TO CHEMICAL
Volume growth of 9.3% to its airline of oil processed. This can possibly lead to
Reliance has developed a future-ready
partners. significant cost savings through economies
Oil-to-Chemical strategic vision to,
of scale and improve competitiveness of
In addition to the best in class service progressively, transform the Jamnagar
companies undertaking such projects.
standards and end-to-end automation, refinery from a leading producer of fuels to
New complexes in Asia and the Middle East
RIL continues to be the only OMC offering chemicals.
have announced projects with 25-40%
unique turnkey solutions to its airline
The fundamentals of the Jamnagar oil-to- crude to chemical conversion. A Leading
partners for cost reduction across its
chemical strategy, are to employ advanced Middle Eastern NOC in collaboration with
network. Having the highest market
molecule management to upgrade the technology providers has undertaken
share at 20% of the operating airports
refinery intermediate streams, by value. research to maximise oil to chemical
reinforces customer’s trust in Reliance
The Jamnagar oil-to-chemical objectives conversion to 70%.
Aviation.
are to preserve as well as upgrade existing
R&M PLATFORM
To leverage the soaring Indian aviation refinery margins, while maximising asset
The R&M business has already embarked
market, RIL has enhanced its network of utilisation, for a sustainable competitive
on Journey of Platform Based Ways
Aviation Fuel Stations to 30 in cost of chemicals.
of Working. Also single unified source
FY 2018-19 and working on adding
RIL has developed a disruptive technology (Datalake) for all the organisation data,
another 10 locations in the near term.
innovation, a Multizone Catalytic Cracking is established. Advanced analytical
C) Facilitating Nation’s Energy Security (MCC) process, which converts a wide range models along with visualisation, are being
More than three quarters of RIL’s of feedstock to high value propylene and developed and delivered to business users
production of transportation fuels was ethylene in a single riser. This technology, in phase wise manner. These initiatives are
absorbed in the Indian market during protected by Reliance’s IP, shall underpin helping business users with insights for
FY 2018-19. In addition to selling through Jamnagar’s oil-to-chemical mission. informed decision making.
own retail network and HSD – Direct The oil-to-chemical programme is a
segment, the absorption was achieved roadmap implemented over a long time
by bridging the product deficit of all horizon, based on market outlook and
the major Public Sector Oil Marketing price triggers for refinery fuel products. The
Companies in India. ultimate goal is to achieve greater than 70%
conversion of crude refined in Jamnagar,
RIL is also partnering with Government
to competitive chemical building blocks of
in meeting their vision of abolishing
olefins and aromatics.
indoor pollution to improve the health
of rural women. Significant share of the The Jamnagar refinery product slate, at the
household cooking LPG demand of the culmination of oil-to-chemical transition,
Public Sector OMCs is met by RIL. shall be only jet fuels and petrochemicals.
All refined products priced below crude Jamnagar supersite ranks 1st in the
world, in complexity-barrels.

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 59

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Refining and Marketing (R&M)

QQ ILLUSTRATION: IMPACTING CUSTOMERS WITH A DIFFERENCE

Digital ecosystem Increase in customer Reinforce

engagement customer trust

Innovating Technology to Transform Technology adoption–Automated Convenience for Customers–

Transconnect Delivery Receipt (ADR) – Eliminating C Stores
manual intervention

Situation Situation Situation

There was a need to increase customer Primary purpose of eliminating manual To be more competitive in the market by
retention along with targeting new intervention was to increase transparency trying to offer more convenient shopping
customers with airline partners experience to customers

Action Action Action

• Issuance of Virtual Card for Instant • Installing state-of-the-art system to • Offering collocated one stop shop
enrolment allowing real-time provide 100% ADR to all scheduled (successful commissioning at 8 pilot
deliverance of marketing offers to airline partners points) for purchasing products of daily
customers needs and consumption
• Trans-Mobile for Instant transaction, • Leveraging synergy with Reliance Retail
cash loading and simplified account via convenience stores – Qwik Mart
updation
• Integration of customer and fleet
application, allowing real time viewing
of customer creation

Outcome Outcome Outcome

Improved customer experience leading Total transparency helped reinforce Reinforced competitiveness through
to higher customer retention reflected in customer trust in RIL service unique proposition
increased sales

60 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

PROJECT UPDATE
PETCOKE GASIFICATION
All units of the Gasification complex
including air separation units, material
handling systems, gasifier islands, syngas
shift and processing facilities, sulfur
recovery units, and associated utilities
and offsites have been started safely.
Currently, the gasification complex is under
stabilisation.
The pet-coke gasification project shall
transform Jamnagar into a unique
'bottom-less' refinery by upgrading low
value refinery residue, pet-coke, into
clean syngas. This will help in reducing
the impact of LNG price volatility by
substituting high cost LNG imports. It is one
of the largest ‘Clean Fuel’ projects in the
world. Syngas shall leverage LNG and pet-
coke price arbitrage to minimise the utility
cost of the Jamnagar complex.

BUSINESS STEWARDSHIP
The Jamnagar supersite is designed to
achieve zero freshwater withdrawal by
implementing design efficiency. It is also
capable of producing Euro VI fuel.

Jamanagar petcoke gasification – one of the largest ‘Clean Fuel’ projects in world

Petcoke Gasification Unit at Jamnagar

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 61

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance

Petrochemicals

Nikhil R. Meswani Vipul Shah Par Singh

RIL achieved record EBIT of `32,173 crore

(up 51.9% y-o-y) and production
of 37.7 MMT in the petrochemicals segment
for the year, reflecting value accretion
and growth acceleration through scaled
up capacities. RIL’s integrated operations,
feedstock flexibility and enhanced customer
focused approach, delivered a sustainable
bottom line for the Petrochemicals business
amidst a challenging global environment.
Completion of last mile connectivity of
the ethane pipeline and commencement
of ethane cracking at Nagothane
division underpinned RIL’s global cost
competitiveness.
Building on its 'Chemistry for Smiles'
theme, RIL continues to broaden its product
portfolio, through innovation and customer
centric initiatives, like R|ELan fabrics and
Recron Certified products. RIL launched the
'Fashion For Earth' and the eco-sustainability
porgramme, to promote circularity within
the fashion industry.
Reliance is also strengthening its newly
ventured Advanced Materials and
Composites businesses by leveraging
the capabilities in polymer formulations,
materials engineering and product design,
3D printing and application development
to deliver innovative products and solution
offerings to the industry.

Jamnagar supersite

62 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

STRATEGY

ROBUST ASSET SUSTAINING VALUE COMPETITIVE

PROFILE CREATION STRENGTHS

• One of the most integrated • Refinery off gas cracker, a unique project • Fully integrated operations providing
petrochemicals producers globally and expansion of downstream capacity cost competitiveness
• Leading market position across product to cater to expected demand growth • Captive and cost effective feedstock
categories • Ethane imports enable a cost advantage supplies provide feedstock security
• World class production facilities and feedstock security • Benefits of economies of scale
• Industry leading operating rates across • Strong brand initiatives enabling • High domestic market share across most
products Reliance’s shift in focus towards products
• Commissioning of High Purity Iso- consumers • Proximity to key consuming markets and
Butylene (HPIB) unit for C4 value diversified consumer base
addition

INTRODUCTION
HARNESSING THE POWER OF CHEMISTRY

Name Olefin Polymers Polyesters Aromatics and Fibre Elastomers

Intermediates

DESCRIPTION Unsaturated open chain Large molecule with Synthetic Fibres Raw Material for Polymers with rubber
hydrocarbon repeating subunits polyester and textile like elasticity
industries, Industrial
Chemicals

RIL PORTFOLIO Ethylene, Propylene, Polyethylene(PE), Polyester Filament Purified Terephthalic Poly-Butadiene
Butadiene Polypropylene(PP), Yarns (PFY), Polyester Acid (PTA), Monoethylene Rubber (PBR), Styrene
Polyvinyl chloride (PVC) Staple Fibres (PSF), Glycol (MEG), Paraxylene Butadiene Rubber
Polyethylene (PX), Benzene (BZ) (SBR), Butyl Rubber
Terephthalate (PET)

APPLICATIONS/ASSO- Industrial Chemicals Construction, Textile / Apparel Polyester and textile Tyres and Automobile
CIATED INDUSTRIES and Polymers Agriculture, Automobile, industries and industries, Industrial
Consumer Goods Beverages Chemicals

CAPACITIES/ GLOBAL Feedstock for PE: 2.3 MMTA/ 11th PFY and PSF: 2.1 MMTA PTA: 4.9 MMTA/ 4th PBR: 120 KTA
MARKET POSITION petrochemical products PP: 2.9 MMTA/ 5th PET: 1.1 MMTA/ 8th MEG: 1.5 MMTA/ 6th SBR: 150 KTA
Ethlyene: 3.6 MMTA PVC: 0.7 MMTA/ 16th PX: 4.8 MMTA/ 1st

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 63

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Petrochemicals

MARKET ENVIRONMENT PRICE AND MARGIN ENVIRONMENT

FY 2018-19 witnessed a firm energy price environment which, reflected in petrochemical Polymer chain
feedstock and product prices. However, the strength in product prices were relatively Crude oil prices saw high volatility during
modest as compared to feedstock prices, resulting in mixed petrochemicals margins. the year. The prices touched near 4-year
high amid geo-political concerns and
OLEFINS AND POLYMERS
production cut by OPEC. In the later
Global demand for ethylene increased by 3% y-o-y to 158 MMT in 2018. Global ethylene
part of the year, prices moderated due to
operating rates have declined to about 88% from about 89.5% in previous year. New
global economic concerns, crude stock
capacities of 6 MMTA was added during the year, resulting in capacity addition outpacing
build-up in the US and weaker energy
demand growth.
demand growth projection. Average
Global Ethylene Supply/Demand 2018 naphtha prices in Asia were up by 16% y-o-y
Production by feedstock Demand by end use
in FY 2018-19 amidst strong crude price
Production : 158 MMT Demand : 158 MMT
and sustained petrochemical demand.
Naphtha 40% Polyethylene 62%
Ethylene prices in Asia marginally softened
Ethane 39% Ethylene Oxide 15%
by 3% due to lower downstream PE prices
Propane 9% Ethylene Di-Chloride 9%
amid new capacity additions in the US.
Butane 5% Ethyl Benzene 6%
Propylene prices in Asia strengthened by
Others 7% Others 8%
12% with healthy downstream PP demand
growth and seasonal turnaround of
Source: IHS Markit
crackers in North East Asia.
USA has started 3.5 MMTA new ethane based crackers capacity in 2018. The other major
capacity additions were in China, Iran and South Korea. In the USA, another 4.3 MMTA South East Asia polymer margins
crackers capacity is expected to come online in 2019. These additional capacities are based (US$/MT) FY 2018-19 FY 2017-18
on low cost ethane from shale gas production, continuing to pressurise ethylene market HDPE-Naphtha 576 668
fundamentals. In Asia, 2.3 MMTA capacity is expected to come online in China in 2019 PP-Propylene 249 300
besides 1.3 MMTA capacity in Malaysia. PVC-EDC-Naphtha 465 583
Source: Platts and ICIS
Global propylene demand increased by 6% y-o-y to 112 MMTA in 2018. The higher
incremental demand compared to supply (5% y-o-y) resulted in operating rate increasing PP and PVC prices remained well above
to 80% from 78.5% in 2017. The addition of 2.8 MMTA capacities in 2018 is expected to 5-year average during FY 2018-19 with
keep markets well supplied in the near-term. Economics of Coal to Olefins (CTO) capacities healthy demand supply scenario. However,
improved during the year with softening of coal prices; however, environmental risk polymer margins weakened due to high
persists. On-purpose Coal to Olefins (CTO), Methanol to Olefins (MTO) and Propane feedstock prices. On y-o-y basis, PP, PE
Dehydrogenation (PDH) units remained the marginal supplier of Olefins to global markets. and PVC margins corrected by 17%, 14%
and 20%, respectively. PE prices weakened
Global Polyolefin and PVC Demand amid increased supplies as first wave of
(In MMT) CY 2018 CY 2017 % growth new ethane-based capacities came online
Polypropylene 74 70 5.7% in the US. PVC margins weakened due to
Polyethylene 101 96 5.2% high Ethylene Dichloride (EDC) prices led by
Poly Vinyl Chloride 45 43 4.7% a weak caustic price environment.
Ethylene 158 154 2.6%
Propylene 112 106 5.7%
Polyester and Fibre Intermediates
The polyester market remained volatile
Source: IHS Markit
during FY 2018-19 with overall weakness
Global polymer demand (PE, PP and PVC) in 2018 was estimated at 220 MMT. Polyethylene due to sluggish downstream demand.
(PE) accounted for 46%, Polypropylene (PP) 34% and Polyvinyl Chloride (PVC) 20% of the Initial strength was followed by gradual
market. Demand for polymers remained resilient amid uncertain global economic growth weakness in polyester sales, which further
and grew by a healthy 4.8% during the year, above the 5-year CAGR (4.6%). The global weakened as demand remained lacklustre
demand for polymers is expected to grow at a healthy pace in near term, driven by India, even after Chinese National holidays.
China and other emerging economies. Trade conflicts between the US and China re-routed
Overall, polyester prices during the period
global trade flow. Incremental supplies from the US have been diverted to the South East
were higher but margins declined due to
Asian market, while China increased its imports from the Middle East. China’s ban on
firm feed-stock prices. Globally, polyester
import of recycled polymers w.e.f. January 1, 2018 resulted in increased demand for virgin
demand growth was resilient at 3% during
resin in the region.
2018, driven by demand in Asia’s emerging

64 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

economies, which cover 85% of the global to grow by 3% CAGR till 2022. India demand passenger car assembly grew at 2.3% while
market. The Indian polyester market is around 10% of the global consumption commercial vehicles production grew by
witnessed healthy demand growth of 7%. (68 MMTA). 5.3% y-o-y. The operating rates of both PBR
and SBR are expected to improve in near
Global PET prices for the year surged by Monoethylene Glycol (MEG) markets
future with growing demand and limited
18% y-o-y as demand remained healthy witnessed weakness as margins declined
capacity addition.
amidst tight supplies with delays in the by 23% y-o-y during the period. MEG
restart of the PET units in USA, Europe markets had a strong start to the year but DOMESTIC SCENARIO AND
and China. PET margins surged by 32% faltered due to rising port inventories and OPERATIONAL PERFORMANCE
y-o-y owing to firm demand from beverage slower offtake from polyester sector. Global Polymers
segment, tight supplies and curtailed capacity grew by 6% y-o-y during 2018, The Indian polymer market registered a
output. During CY 2018, global PET demand compared to 8% y-o-y demand growth. healthy growth of about 7% in FY 2018-19
was estimated at 24 MMT, compared to China introduced trading in MEG at Dalian y-o-y. PE demand growth was healthy at 4%
global PET capacity of 31 MMT. Asia / Far Futures Exchange to streamline investment y-o-y (led by LLDPE growth of 11% y-o-y)
East region account for 42% of global into MEG and curb speculative trading. driven by increasing disposable income and
PET demand with China’s PET demand growth in e-commerce sector. PP demand
International cotton prices improved 5%
estimated at 5.5 MMT (23% of global PET growth was at 7% y-o-y driven by boost in
y-o-y during FY 2018-19. Cotton to polyester
demand). infrastructure and cement industry. PVC
price differential narrowed marginally and
demand growth has been fuelled by pipe
Polyester and fibre intermediates margins stayed above 5-year average, favouring
demand, both in the construction and
polyester consumption. Global cotton
(US$/MT) FY 2018-19 FY 2017-18 agriculture sectors. Enhanced focus on R&D
PX 479 346
production in 2018-19 (August-July) is
in automobile and appliance sector led to
PTA 181 131
expected to decline 4% y-o-y to 26 MMT
sustainable growth in the PP co-polymer
MEG 417 538
against increased consumption of 1% y-o-y
segment in India. Increasing awareness
POY 262 282
at 27 MMT. Slower than expected arrivals
and policies against single usage plastic
PSF 154 201
in Indian markets have bolstered domestic
resulted in lower demand growth in tubular
PET 222 167
cotton prices. India’s cotton supply is
quench (TQ) and thermoforming sectors of
estimated to drop 1% y-o-y to 7.19 MMT
Source: Platts, ICIS, CCF Group PP and PE.
during cotton season 2018-19. Total cotton
During FY 2018-19, polyester chain margins consumption is estimated to be stable at India is the world’s fastest growing polymer
remained healthy, indicating strong 6.49 MMT, resulting in 13% y-o-y lower market with a 5-year CAGR (2014-18)
market sentiments. Operating rates across closing stock at 0.70 MMT, conducive to demand growth of 9.1%. It is the second
polyester chain remained healthy favouring polyester substitution largest demand hub for polymer in Asia
integrated polyester producers during the after China.
Elastomers
year.
During 2018, global Natural rubber
During the year, PX prices gained 25% y-o-y production was at 13.9 MMT, up 2.5% y-o-y
driven by firm feedstock prices and healthy while demand growth was up about 4.9%
PTA demand. During CY 2018, global PX y-o-y to 13.87 MMT. Slowdown in economic
capacity grew by 4% y-o-y, compared to 9% activities driven by the US-China trade
y-o-y demand growth. However, start-up conflict weighed on downstream operation
issues in new PX units and subsequent and rubber consumption.
planned turnarounds kept PX markets
Global capacity of Butadiene continues to
tight, supporting prices and margins.
remain stable at 15.2 MMTA with average
PTA markets remained buoyant amidst operating rate of around 78% in CY 2018.
healthy operational efficiencies, supported With more light feed crackers coming
by strong downstream demand and tight up, mainly in the US, the availability of
supplies. PTA margins improved 38% y-o-y Butadiene is expected to be limited.
with firm demand from markets outside
The global capacity of PBR is 4.5 MMTA
China. During 2018, Global PTA capacity
in 2018 with average utilisation rate of
grew by 7% y-o-y compared to 8% y-o-y
78%, while the global capacity of SBR is
demand growth. China continues to
6.7 MMTA in 2018 with average utilisation
be the largest consumer of PTA,
rate of 68%. PBR and SBR demand are
accounting for 58% of the global Cracker Control Centre
directly linked to growth in automobile
consumption. China demand is expected
and tyre sectors. During CY 2018, global

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 65

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Petrochemicals

FINANCIAL AND OPERATIONAL PERFORMANCE Automobile demand in the latter part of the
Financial Performance year was impacted by poor festive demand,
revised axle norms and high fuel prices.
FY 2018-19 FY 2018-19 FY 2017-18 %
(` in crore) (US$ in Billion) (` in crore) Change Butadiene witnessed demand growth of
Revenue 1,72,065 24.9 1,25,299 37.3 15% y-o-y to 360 KT during the year as
EBIT 32,173 4.7 21,179 51.9 against an installed capacity of 550 KTPA.
EBIT (%) 18.7% 16.9% PBR and SBR demand in India is estimated
to be 194 KT and 330 KT respectively in
FY 2018-19 revenue from the RIL’s continuous efforts towards FY 2018-19 and is expected to grow at 5-7%
Petrochemicals segment increased strengthening of supply chain network, annually in the medium-term.
by 37.3% y-o-y to `1,72,065 crore enabled the Company to place polymers
NEW PRODUCT DEVELOPMENTS
(US$24.9 billion), primarily due to higher in more than 70 countries globally during
Polymers
volumes and prices, which reflected full the year.
• PE Net for paddy stubble bales:
benefits of ROGC and Paraxylene capacity
Polyester and Intermediates Broadening Plasticulture applications.
expansion projects. Petrochemicals
Production • Special PE sleeves for saplings:
segment EBIT increased sharply by 51.9%
Global production* Protection from wildfires in Maharashtra
to its highest ever level of `32,173 crore
(Production in MMT) FY 2018-19 FY 2017-18 • Cast film PP for food packaging: Increase
(US$4.7 billion). Strong integrated polyester
POY 1.1 1.1 shelf-life of perishables and products
chain margins offset weakness across the
PSF 0.7 0.7 containing high fatty acid
polymer chain, which was impacted by
PET 1.2 1.1 • PE bubble film for greenhouses: Better
incremental supplies from new US crackers.
PX 4.3 3.7 technical performance and higher shelf-
Petrochemical segment recorded strong
PTA 4.9 4.7 life of nearly 10 years, reducing farmers’
EBIT margin of 18.7%, aided by strength in
MEG 1.7 1.2 recurring expenses
PX margins.
* Malaysia numbers included • High melt flow index PE: For applications
Polymer Production of stretch films
During the period, Indian polyester
• 100% recyclable PE pouch: For consumer
filaments market grew by 10% y-o-y while
packaging application
(Production in MMT) FY 2018-19 FY 2017-18 PET market grew by 9%. PFY markets were
PP 2.9 2.8 buoyant in the early part of the year as PROJECT UPDATE
PE 2.1 1.4 downstream units diversified with new Record production during the year was
PVC 0.7 0.7 applications, expansion and re-stocking achieved with full utilisation of the ROGC
Ethylene 3.7 2.6 due to firm prices. PSF markets weakened and PX projects which were commissioned
due to liquidity crunch, increased recycled in the previous year. RIL also completed the
RIL is a leading global manufacturer
PSF availability and weak international last leg of ethane pipeline between Dahej
of polymers with 6 state-of-the-art
price environment. PET demand firmed and Nagothane during the year. Ethane
manufacturing facilities. RIL maintained
amidst improved downstream buying, cracking at Dahej, Hazira and Nagothane
its leadership position in Indian polymer
supported by Government’s decision has been streamlined and all the plants
market with domestic industry market
to exclude PET from ban on single-use achieved highest ever ethylene production.
share of 33%.
plastics.
RIL is the world’s fifth largest producer
Domestic Elastomer Production
of PP. During FY 2018-19, the Company
recorded its highest ever production of PP Elastomer production
at 2.9 MMT and maintained 45% domestic (Production in MMT) FY 2018-19 FY 2017-18
market share. Post start-up of ROGC and Butadiene 0.2 0.2
downstream plants, RIL became world’s PBR 0.1 0.1
7th and 11th largest producer of LLDPE and SBR 0.1 0.1
LDPE respectively. RIL produced 2.1 MMT
Indian elastomers sector witnessed stable
of PE, which helped grow the domestic
demand environment during the year, led
PE market share to 28% and LDPE market
by commercial vehicle demand growth
share from 35% (before start-up of ROGC)
(17.6%). Passenger vehicle demand
to 62%. RIL’s PVC production was at
growth was muted during the year at 2.7%. Refinery Off Gas Cracker at Jamnagar
0.7 MMT with 23% domestic market share.

66 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

INTEGRATED BUSINESS MODEL

TRANSFORMING RIL PETROCHEMICAL BUSINESS, BUILDING A CUSTOMER CENTRIC ORGANISATION

Petrochemicals

R&M Integrated Value Chain

Naphtha C3/ Reformate Deliver a lasting value
Propane proposition to customers
Opportunity in asset base
Cracker Manage risks across cycles
Delivering sustainable
Ethane C2/ C3/ C4 solutions
Polymers Elastomers Polyesters

Ethane Imports PE SBR Aromatics

PP PBR PTA, MEG
PVC Fibres, PET

Global business process Reliance Management Systems Integrated SCM CRM R-HR

World-class IT and analytics APO Price Mgmt. System Forecasting Tools SAP-BPC

CONSUMER FACING BUSINESS

R|ELAN – NEXT GENERATION FABRIC

R|Elan™ is a portfolio of innovative fabrics that has been developed to offer more
to end consumers, across apparel segments like activewear, denim, ethnic and
western wear, both formals and casuals. Fabrics from R|Elan™ are made from
specially engineered fibres that combine functionality and fashion with a focus on
sustainability.

Flagship products Widespread acceptance In order to support circularity in fashion

R|Elan™ Kooltex used in making In line with RIL’s B2B2C focus, R|Elan™ and catalyse waste reduction in the fashion
activewear apparels directly connects with brands and retailers industry, R|Elan™ has launched the ‘Circular
who know their target consumers. R|Elan™ Design Challenge’ through its ‘Fashion
R|Elan™ FreeFlow used in manufacturing
has been gaining overwhelming acceptance for Earth’ initiative together with the UN
sarees and dress material, western and
from domestic and global brands across all Environment in India and Lakme Fashion
ethnic wears
apparel segments. Week of IMG-Reliance.
R|Elan™ SuperSoft used in shirting
Committed to a larger purpose
R|Elan™ GreenGold, the textile made R|Elan™ is committed to a circular
out of the greenest fibres in the world, economy in fashion industry and is one
manufactured by recycling used PET of the world’s 'greenest' recycler of PET
bottles that finds its way in trousers bottles into fabric, thereby helping reduce
and denim pollution and carbon footprint.
R|Elan™ SuperBlack used in suiting

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 67

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Petrochemicals

RECRON® CERTIFIED  

Developing a unique consumer brand Focus areas

BRAND PROPOSITION:
Fifteen years ago, Reliance identified • Strengthen its portfolio further by
THE SLEEP EXPERTS
the under-served ‘sleep and dream’ penetrating deeper into the home
The brand consists of a wide range
product category as an opportunity comfort segment
of products in the Sleep Comfort
area and developed Recron® Certified, a • Extend consumer trust from pillows to
category – pillows, cushions, bolsters,
unique consumer brand franchise-based mattresses, leveraging brand strength,
comforters and quilts. With the recent
business. Since then, Recron® Certified has category expertise and quality emphasis.
addition of a number of products
consolidated its position as a true-value, It aims to enhance customer comfort
variants in the high-growth mattress
high-quality home-comforts product brand during sleep and become a leading
segment, Recron® Certified is now
and has become the largest selling pillow mattress brand in the chosen segment
truly a one-stop shop for all sleep and
brand in the country. Owing to the depth
dream products.
of its merchandise and wide-spread reach,
One in 10 families in India has
Recron® Certified is a brand appealing to In each of its product categories,
experienced the comfort of sleeping
both the value-seeking mass segment and significant investments in R&D
on a Recron® Certified pillow.
the premium class-seeking segment. have ensured that the brand offers
superior attributes, including
aesthetics, ergonomics, durablity and
value in use.

ADVANCE MATERIAL
Reliance is developing a new business
vertical in the Advance Material domain.
Material properties and material
engineering coupled with design, provides
a development platform that will add
value to Reliance’s current and new
product offerings and enable Reliance to
deliver compelling solutions to customers.
RelWoodTM is one such advance material,
replacing wood across categories.
Reliance has already ventured into
Fibre-Reinforced Composites as part of
its Advance Material strategy, which helps
in light weighting and rendering superior
properties. It has the potential to reduce
steel usage in infrastructure projects.
RECRON® CERTIFIED – HELPING MILLIONS SLEEP BETTER Reliance is also working on two-
Pan-India presence through an extensive channel network comprising Authorised dimensional nanomaterials such as
Licensee manufacturers, Distributors and Retailers (both traditional as well as modern graphene, which when added to the
retail formats) existing polymer portfolio, would deliver
new formulated materials that will provide
100% quality control – Committed to offering products with highest quality standards as
exceptional value to the customers.
per the existing RIL standards, and consistent across all the markets, using the
‘Zero Defect Principle’
75% products made using ‘green fibres’, thereby making them environmentally friendly,
generating societal value and promoting a circular economy

68 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

RELWOOD™ – ONE MATERIAL, ENDLESS fire-resistant, but is virtually and aerospace. RCS leverages in-house
POSSIBILITIES indistinguishable from wood by look or designing and development capabilities
The consumption of wood in India has risen touch. It can also be thermoformed to to deliver new applications and solutions,
with the growth of construction industry create unique shapes and designs. tailor made as per customer requirements.
at about 10% y-o-y. However, for nearly a
RELX™ COMPOSITES AND
century, there has been no path-breaking
CARBON FIBRE
innovation in the wood material industry
RIL acquired the assets of Kemrock
in India, except for the advent of plywood.
Industries in FY 2017-18, which is now
Reliance identified an opportunity in this
launched as Reliance Composite Solutions
space and innovated RelWood™, a natural
(RCS) under the trademark RelX™. RCS
fibre polymer composite. RelWood™ is
has a state-of-the-art manufacturing
the result of a disruptive technology that
facility spread across 198 acres, having
combines the aesthetics and warmth of
composites processing units consisting of
wood with a focus on sustainability.
3 feedstock and 7 finished goods plants.
Made with patented German technology, RCS will provide solutions to markets like
RelWood™ is 100% waterproof, mass transport and railways, renewable
RelWood furniture
termite-proof, UV-resistant and energy, infrastructure, automotive, defence

QQ INNOVATIVE PRODUCT DEVELOPMENT

1 FTTX POLE FOR TELECOMMUNICATION

These are composite poles used for transmitting gigabytes of data and are produced by pultrusion process.
Poles are designed as per TIA-222 G2 (US telecom standard). These poles are lightweight and cost competitive,
compared with existing metal or concrete ones. The design is flexible to attach additional fixtures and can be
used as a utility pole or as a next generation smart pole. Reliance is also engaged in developing new innovative
composite material for a smart light pole for 5G infrastructure.

2 UNDERGROUND FUEL STORAGE TANK (UST)

These are underground FRP storage tank prototypes for storing petroleum products. It is designed according
to the latest standard EN13121-3 and tested for UL-1316. The use of composite has benefitted the tank with
non-corrosive property, less manufacturing time and improved product life.

3 TRAIN COACH TOILETS

Reliance materials – right from thermoplastics to composites – are used in the production of prototype of toilet
modules with a new radical design considering aesthetic, functional and passenger comfort requirement.

4 TRAIN INTERIORS FOR COACH

Reliance’s composites are being used in prototypes of new passenger locomotive interiors with new features such
as inclined stair arrangement for easy ingress and egress of passengers and foldable ladder for giving passengers
easy access to berths.

5 CARBON FIBRE WRAP

Using carbon fibre wrap, Reliance Composites has the capability to design and implement solutions aimed at
restoring building, pipeline, road and bridges infrastructure.

Reliance Composites is building an application development centre to showcase capabilities and to help customers understand
the applications. It will be equipped with state-of-the-art characterisation and testing facility to foster innovation and new product
development.
RIL is also investing in India’s first and largest carbon fibre production line with homegrown technology–to cater to India’s aerospace and
defence needs and other specialty industrial applications.

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 69

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Petrochemicals

• Predictive analytics on demand forecast RELIANCE’S APPROACH TO CIRCULAR

integrated for accurate planning to serve ECONOMY
customers better Plastics play a major role in improving the
• Customer interface for fabric certification quality of life and help in tackling number
and brand management for R|Elan brand of societal challenges. Plastics directly aid
was built on open source, microservices in achieving the UN’s SDGs by reducing
based platform architecture food waste (increasing shelf life of food),
helping reduce resource consumption
PROCESS AUTOMATION AND (current alternatives use more energy and
ENHANCED DECISION MAKING water in production) and providing raw
• Robotic Process Automation (BOT) for materials for life saving medical instruments.
automating repetitive processes Through innovative solutions/ applications,
like E-way bill, e-BRC, B2B order plastic products help in improving process
processing etc. efficiency, thereby reducing overall GHG
• No touch sales order processing based emissions particularly in automotive and
on auto allocation through system construction industries.
• Block chain platform integrated with
ReleXTM Applications electronic Bill of Lading (eBL) to issue
and manage eBL. Blockchain enabled LC
transaction through a consortium led by
3D PRINTING TECHNOLOGY
HSBC
Additive Manufacturing, commonly known
• “Business Command Center” system of
as 3D printing, is gaining acceptance
role based dashboards that leverages
rapidly with increase in number of
information for collaborative operations
proven applications in end-use parts in
and enhanced decision making
various industries. RIL has developed
• Data Science and Predictive Analytics Unfortunately, due to unchecked littering,
capabilities to design and print prototypes
deployed for Price forecasting, Customer plastics as a whole get maligned. The
as well as end-use parts for Oil and
Credit risk management and freight cost benefits of plastics need to be acknowledged
Gas, Medical, Electronics and Industrial
analysis by encouraging proper collection,
Tooling industries. RIL is also working on
segregation and education. This will ensure
developing 3D-printable materials out of DIGITAL SUPPLY CHAIN
our smooth transition, as a society, towards a
RIL’s downstream products such as PP • Warehouse Management (EWM) operated
circular economy.
and PE. on smart devices simplifies complex
logistics, optimises inventory tracking, For Reliance, ‘Sustainability’ is not just a buzz
DIGITAL INITIATIVES AND PLATFORM distribution operations, multi-channel word, it is about how Reliance operates. RIL
fulfilment, and more, all real time strives to promote Circular Economy and
DIGITAL CUSTOMER EXPERIENCE
• Ensure distribution safety through deliver Societal Value. Reliance’s approach
• Enhancing user experience and enabling
'Emergency Response Center' on is to innovate, collaborate and educate
Sales and Collection transactions on
IoT enabled Vehicle Tracking System communities to help end plastic waste in the
smart devices
integrated with biometrics and voice box environment:
• E2E tracking of Order Fulfilment is
• Automation through EDI (Electronic Data
enabled on mobility Platform • I nnovate through circular business
Interface) with major ports and shipping
• Machine Learning enabled Chatbot for models: Reliance continues to be
lines
customers, agents and transporters one of the largest recyclers of the
• ePOD mobile app for drivers to capture
• Delivery tracking through IOT enabled post- consumer PET waste and converting
electronic proof of delivery and auto
Vehicle Tracking System is implemented it into value added, branded products like
service certification for transporters
for dedicated fleet R|Elan™ and Recron® Certified. During
• Integrated Business Planning and
• Collaborative planning through CRM FY 2018-19, RIL recycled about 2 billion
Optimisation implemented with objective
platform to effectively manage customer waste PET bottles, converting it to
to maximise contribution rate
demand products like Recron® GreenGold – one of
• Cloud based systems for digital
• Mobility apps like approvals, account the lowest carbon foot-print globally.
settlement of commercial contracts, eBL
management, customer visits to
and road freight management • E
 ducate (Communication and
empower Sales Force for better customer
Awareness): Reliance continues to
service
engage with internal and external
stakeholders to educate and improve

70 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

consumer awareness. During FY 2018-19, QQ ILLUSTRATION

the Company carried out awareness
sessions across the manufacturing sites Reliance’s Fashion For Earth
and also carried out awareness at major
launched the ‘Circular
schools in Mumbai.
• Collaborate: Reliance engages and Design Challenge’ at Lakme
collaborates with governments, Fashion Week with the UN
businesses and consumers to drive
effective solutions. For instance, RIL
Environment Circular Design Challenge
led participation of Indian Industry at
Need to reduce waste and implement
UNEA-4 Nairobi
circular economy concepts in the fashion BUSINESS STEWARDSHIP
value chain In keeping with the motto of ‘Chemistry
for Smiles’, Reliance continues to produce
eco-friendly products such as GreenGold
Action Taken (made from recycled PET bottles using
renewable energy, with one of the lowest
To incentivise waste reduction
carbon footprints globally), R|Elan™
and catalyse adoption of circular
(a fabric with increased breathability,
BEFORE economy in the Indian textile
anti-odour benefits, and excellent drape)
industry, Reliance, UN Environment
among others. Additionally, the Company
and Lakme Fashion Week,
continues to be one of the largest recyclers
successfully launched and concluded
of PET bottles in India.
the first edition of the ‘Circular Design
Challenge’. The ‘Circular Design
Challenge’ is an annual competition
where fashion and product designers
AFTER submit a proof of concept of
creating a fashion collection that
encompasses key principles of
RIL worked with Afroz Shah’s team to
circularity, sustainability, aesthetics
clean up the Versova beach in Mumbai.
and scalability. First edition of the
RIL sponsored the BobCat to expedite
challenge was won by Stefano Funari
retrieval of solid waste off the beaches
and Poornima Pande for their brand
and from the oceans. This one-of a
‘I was a Sari’.
kind solution has replaced the need for
manual clean-up drives by volunteers.
It has resulted in a more efficient and Scale of Impact
systematic cleanup recovering about
1.5 Million Kgs. of solid waste in 180 First edition of the Circular Design
days – that much less waste in the Challenge saw over 900 registrations
oceans from over 30 cities across the
country.
INITIATIVES HIGHLIGHTS
• Reliance has 3 plastic-to-roads projects
underway on pilot basis. These
initiatives have helped create solution
Outcome
for disposal of non-recyclable post-
consumer plastic waste. As a first pilot, Through such initiatives Reliance has
1.2 tonnes of plastic waste has already helped raise awareness on textile
been used for construction of 2,600m2 waste generation and promote the
of road in Reliance Corporate Park. use of sustainable materials and offer
Further, about 50 tonnes of plastic solutions that are helpful in reducing
waste will be used at Nagothane environmental impact caused by
Manuacturing Division for construction waste in the fashion, textile industry.
of 40 km of road.

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 71

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance

Oil and Gas Exploration & Production

P.M.S. Prasad Naresh Narang Sanjay B. Roy

FY 2018-19 marked progress on plans

to monetise discovered resources in
deepwaters.
RIL has commenced development
work for R-Cluster and Satellite
Cluster fields in the KG D6 Block.
Field Development Plans for MJ have
been approved by Government.
These fields are expected to come
onstream from mid-2020 onwards.
There has been steady production
from the Coal Bed Methane (CBM)
fields in Sohagpur. Development
activities are underway to further
enhance the production.
Reliance continues to focus on
value preservation in the Shale Gas
business. In this regard, Reliance is
restructuring its Shale Gas assets
through cross-border merger of
RHUSA with RIL.

CBM Group Gathering Station

72 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

STRATEGIC ADVANTAGES AND COMPETITIVE STRENGTH

Reliance’s upstream business encompasses PROJECT SAFETY

the complete chain of activities from EXECUTION
acquisition to exploration, development
and production of hydrocarbons in both KG D6 – India’s first and till date only Over 11 years of safe operation, with
conventional and unconventional areas. greenfield deepwater project safety record among the best in the world
Reliance has an advantageous position in since commencement of production in
CBM – India’s largest surface footprint
offshore deepwater capabilities, coupled deepwater block KG D6 and in Coal Bed
hydrocarbon project in remote tribal areas
with the knowledge of operations in Methane
with no prior infrastructure
unconventional areas such as CBM.

SIGNIFICANT PARTNERSHIPS
INFRASTRUCTURE
ON THE EAST COAST

RIL has commenced development of Partnerships with global majors in

discovered resources in the KG D6 Block conventional as well as unconventional
leveraging the existing infrastructure on the hydrocarbon plays. The partnerships
East Coast. combine Reliance’s project execution skills
with global expertise

MARKET ENVIRONMENT New exploration is also on the rising trend

In 2018, global oil demand slowed down although it is yet to return to levels prior
to 1.2 mb/d. Demand growth was largely to the price collapse. Global upstream WIP
driven by growth in USA, China and India. investment is set to rise for the third
Oil demand was led by ethane, LPG and consecutive year and is expected to
middle distillates while gasoline demand increase by 4% in 2019 following higher
slowed down. Demand growth was than expected spending last year.
impacted due to high pump level prices in
INDIAN REGULATORY ENVIRONMENT
USA and other economies. Brent oil prices
During the year, there have been many
strengthened 22% during the year due to
initiatives by the Government of India to
geo-political tensions, supply disruptions
promote the Indian Oil and Gas industry.
from Venezuela, Iran and Libya as well as
OPEC+ production cuts. Open Acreage Licensing Policy (OALP) was
implemented, which provides options for
US Henry Hub (HH) gas prices averaged
operators to select exploration areas on
above US$3/mmbtu and peaked as high
their own. Under OALP Bid Round-I, 55
as US$4.8/mmbtu in the second half of
Blocks were awarded and subsequently,
the year. Asia LNG prices strengthened,
the Government has launched OALP Bid
averaging around US$9/mmbtu;
Round-II offering Blocks under Petroleum
however, the prices they remained volatile
Operation Contract for International
throughout the year.
Competitive Bidding.
Upstream capital expenditure showed a
rising trend with increased drilling activity Subsea Structure Foundation Installation
especially in North America. in Deepwater (about 2,000 m WD)

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 73

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Oil and Gas Exploration & Production

OIL AND GAS PORTFOLIO

RIL JV Acreage
Block Country Partner Status
Stake (in acres)
CONVENTIONAL
DOMESTIC
KG-DWN-98/3 India NIKO–10% (see Note1); 60% 3,16,216 1 Producing Fields
BP–30% Field Development Plan (FDP) approved for R-Cluster, Satellite
Cluster and MJ, Field Development activities underway
Panna Mukta India BG–30%; 30% 2,98,256 Producing Fields. Production Sharing Contract (PSC)
ONGC–40% to expire in December 2019
Mid and South Tapti India BG–30%; 30% 3,63,492 Decommissioning and site restoration activities underway
ONGC–40%
NEC-OSN-97/2 India BP – 33.33% 66.67% 2,05,520 FDP Submitted. Under review with GoI
GS-OSN-2000/1 India Hardy–10% 90% 1,48,263 Declaration Of Commerciality (DOC) reviewed
INTERNATIONAL
Block 39 Peru Perenco–55%; 10% 2,13,746 RIL has withdrawn from the PSC. Assignment under approval
PetroVietnam -35% with Government of Peru.
UNCONVENTIONAL
DOMESTIC
CBM
SP(East)-CBM-2001/1 India - 100% 1,22,317 Development ongoing
SP(West)-CBM-2001/1 India - 100% 1,23,552 Production started
INTERNATIONAL
Shale
Pioneer JV USA Pioneer – 46.4%; 45% 1,49,128 Producing
Newpek – 8.6%
Chevron JV USA Chevron – 60% 40% 2,18,104 Producing
Notes
1: Post default of Cash Call, RIL-BP issued Default notice to NIKO on October 16, 2018. Since the dues are not cured by NIKO, RIL-BP has issued notice to NIKO to withdraw from
Joint Operating Agreement (JOA) and PSC and assign their Participating Interest (PI) to RIL-BP. NIKO has served a notice of arbitration in response to the withdrawal notice.
The arbitration tribunal has been constituted and proceedings to commence.
2: Reliance and BP sold their stake in onland Block CB10 to Sun Petro.

Coal Bed Methane Station

74 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

FINANCIAL AND OPERATIONAL PERFORMANCE* 1 mmscmd this year. As CBM Reservoirs

are initially 100% saturated with water,
FY 2018-19 FY 2018-19 FY 2017-18 % the wells go through ‘Dewatering Phase’
(` in crore) (US$ in million) (` in crore) Change during initial years of production. In the
Revenues 5,005 724 5,204 (3.8%) dewatering phase of CBM production,
EBIT (1,379) (199) (1,536) water is pumped out continuously to
increase the gas saturation in the reservoir,
*Consolidated basis
resulting in ramp up of gas production
FY 2018-19 revenues for the Oil and Gas segment decreased by 3.8% y-o-y to `5,005 crore. from these wells. Dewatering process
Volumes from domestic upstream fields and US shale were lower because of natural in RIL’s fields is underway for achieving
decline and slowdown in development activity. Segment EBIT was at `(1,379) crore as further production ramp-up.
against `(1,536) crore in the previous year. For the year, domestic production (RIL share)
Reliance Gas Pipeline Limited, a
was at 58.9 Bcfe, down 25.4% y-o-y and in US Shale (RIL share), business was 94.5 Bcfe,
subsidiary of RIL, operates the 302 km
down 32% y-o-y basis.
Shahdol-Phulpur Pipeline from Shahdol
OPERATIONAL PERFORMANCE – DOMESTIC (MP) to Phulpur (UP). This pipeline
Production Performance connects the CBM Gas fields with the
Indian Gas Grid.
Unit of NORTH AMERICAN SHALE GAS
JV production FY 2018-19 FY 2017-18
measurement OPERATIONS
KG D6 Production Performance
Oil MMBBL 0.26 0.75
Gas BCF 36.4 67.9 JV Unit of CY CY
Condensate MMBBL 0.03 0.05 production measurement 2018 2017
PANNA- MUKTA Gas BCF 73.8 111.8
Oil MMBBL 4.1 5.4 Condensate MMBBL 3.5 4.7
Gas BCF 51.1 62.1
Business Performance
CBM
Reliance is restructuring its Shale Gas
Gas BCF 12.6 7.1
assets through cross-border merger of
RHUSA with RIL, integrating the US gas
KG D6 production was partially offset by better resources with the Indian market, as done
KG D6 gas production declined by 46% production optimisation and successful with ethane for petrochemicals. This will
for the year to 36.4 BCF due to natural revival of a few wells, which were shut in allow shale gas assets to benefit from the
decline of D1D3 field and cessation of MA due to integrity issues. expected upcycle in commodities.
Field in September 2018. KG D6 operations
The Production Sharing Contract (PSC) The Company continued to focus on
continue to achieve field uptime of 100%,
for Panna-Mukta Block is expiring on value maximisation of remaining two JVs
which continues to be the global standard
December 21, 2019 and necessary through production stabilisation, well
for deepwater facilities. Despite challenges
preparations are in progress for handover design improvements reflecting latest
associated with substantial reservoir
of the assets to the Government (i.e. GoI completion designs and improving well
depletion and sand and water influx, the
nominee) on expiry of the PSC. inventory through development plan
focus remains on sustaining production
optimisation and acreage consolidation.
until future projects are commissioned. The ‘Decommissioning Plan for Tapti
Part B Facilities’ is approved by GoI and As part of this strategy, the sale of certain
Panna-Mukta-Tapti
the contract for Engineering Preparation Eagle Ford assets in the Western Eagle Ford
Panna-Mukta field produced 4.1 million
Removal and Disposal (EPRD) has been area to Sundance Energy Inc., was closed
barrels of crude, a reduction of 24% on
awarded. The decommissioning activities during the first half of 2018.
y-o-y basis and 51.1 BCF of natural gas,
are scheduled to be completed by end
a reduction of 18% on y-o-y basis. Reliance’s aggregate capital investments
2021.
The fall in production is due to natural across JVs dropped considerably and was
decline and increasing water cut in the CBM (Sohagpur East and Sohagpur West) US$159 million during CY 2018.
field, shut in of wells due to integrity RIL commenced production from its Coal
For 2019, the thrust remains on preserving
issues and unplanned field shutdown due Bed Methane (CBM) block SP (West)–in
long-term value through high-grading of
to tilting of single buoy mooring facility March 2017. More than 200 wells are on
land and development portfolio, retaining
by water ingress in July 2018. Loss in production, with production averaging

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 75

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Oil and Gas Exploration & Production

optionality, improving execution efficiency Year average gross JV production declined 4. Safe Reliable Operations using
and cost structure. by 17% to 131 BCFe from 159 BCFe in Operations Platform – providing real-
CY 2017, reflecting slowdown in JV time insights into well performance,
Operational Performance
operated activity despite improved production optimisation by monitoring
At Pioneer JV, drilling and completion
operational efficiency and strong well and modelling physical constraints
activities commenced at the end of third
performance. Reliance share of net sales across the production systems
quarter of CY 2018 with the objective of
volume stood at 45.2 BCFe, compared to
testing wells in a new area. At Chevron BIO-CBM
55.0 BCFe in CY 2017.
JV, drilling and completion activity To increase recovery from CBM fields,
commenced in the second half of Reliance is engaged in R&D efforts in
EXPLORATION OUTLOOK
2018 in the JV operated areas, while addition to the established methods.
RIL is in leadership position in exploring
activity continued to ramp up, in the Current focus of this research is Bio-CBM.
and producing hydrocarbons from
non-operated areas. The joint ventures
deepwaters off India’s East Coast, In CBM, methane gas which is adsorbed
drilled 28 wells and put 11 wells on
specifically in KG basin through resources and trapped naturally in coal seams
production.
established, produced and variable plays is produced. Bio-CBM technology uses
Gross JV production was about 0.62 targeted. RIL has the necessary basin and microbe injection to produce in-situ
BCFe/d for the 2 JVs, down 30% y-o-y. play know-how for assessing the petroleum methane where either the coals are devoid
Reliance’s share of production and systems in the area. RIL's strategy aims of methane or conventional CBM extraction
sales were at 94.5 BCFe and 84.0 BCFe, to explore prospects that may eventually is uneconomical.
respectively, in CY 2018, compared to leverage existing infrastructure.
Currently, this technology is in the nascent
139.7 BCFe and 121.4 BCFe in CY 2017.
Application of new technology played stage and the initial lab tests have shown
Pioneer JV a pivotal role, extending the data and encouraging results with respect to
At Eagle Ford, development activities interpretation to its technical limits. methane production potential. Future work
commenced drilling of one pad with 3 wells BroadSeis and BroadBand technology
to explore a new area in the agreement. application aided to image scanning
JV drilled only 1 well and did not frack any deeper targets with improved geological
well during the year while the production understanding. Enhancing the data for fluid
has been rolled over to 2019. With zero contact analysis through optical stacking
activity and natural decline of the has de-risked prospects. Application of
existing wells, year average gross JV robust pore pressure integrated wellbore
production was 21% down at 93 BCFe stability models helped in drilling safe and
compared to 118 BCFe in CY 2017, while economic wells.
Reliance share of net sales volume was at
38.7 BCFe compared to 47.5 BCFe in TECHNOLOGY AND INNOVATIONS
CY 2017. The share of liquids slightly E&P PLATFORM
declined from 67.0% to 66.5% in CY 2018. Aligned with Reliance Enterprise Digital
Vision of 'Reimagining the business model Umbilical Installation at Live
Chevron JV Platform (CRP)
by adopting platform way of working to
While 2018 was characterised by optimised
scale-up stakeholders' experience and
cost structure (well costs and Lease
value 'E&P's digital vision is anchored
Operating Expenses (LOE)), there was little
on the following focus areas, judiciously
progress on JV operated areas, considering
blending open source technologies and
low gas prices that prevailed in early 2018.
Original Equipment Manufacturers (OEM)
With upward trend that prevailed in gas
technologies:
prices during the second half of 2018,
development activity in JV operated areas 1. Cross Domain Collaboration using
restarted from 3Q CY 2018. There was 1 rig Geo-Technical Platform
operating in the JV operated area. There
2. Collaborative Well Planning and
was also significant progress in non-
Drilling Analytics using Drilling
operated areas (with very small working
Platform
interest) in terms of drilling and wells put
on production. 3. Smart Capital Project execution using Deepwater Pipeline Installation Pipes
Project Management Platform being welded at welding stations

76 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

is planned to establish the ability of this knowledge of regulatory requirements to decided in favour of the Claimants. Arbitral
technology to scale up to a commercial give impetus to the Bio-CBM research. Tribunal is yet to schedule recomputation
operation. of accounts and the quantification phase of
UPDATE ON ARBITRATION AND the arbitration, which will take place post
Several microbial consortia were
OTHER LEGAL ISSUES determination of Claimants’ request for
isolated from various locations within
KG D6 COST RECOVERY ARBITRATION increase in cost recovery limit under the
India, screened for methane production
Arbitration claim commenced by the PSCs. The Government has also filed an
potential and the best consortium is being
Company in November 2011 seeking execution petition before the Hon’ble Delhi
optimised.
declaration that it is entitled to recover High Court under sections 47 and 49 of the
RIL is leveraging its infrastructure 100% of its contract costs under the Arbitration and Conciliation Act, 1996 and
(advance laboratories), requisite diverse Production Sharing Contract for the KG Section 151 of the Civil Procedure Code,
inter-disciplinary technical skills, CBM D6 Block (KG D6 PSC). Parties have filed 1908 seeking enforcement and execution
production expertise, CBM fields and their respective pleadings before the of the FPA.
Arbitral Tribunal and are in the process of
DISPUTE WITH NTPC
completing the arbitration proceedings.
QQ ILLUSTRATION NTPC filed suit for specific performance
PUBLIC INTEREST LITIGATIONS of contract for supply of natural gas of 132
Flare stack inspection with Three Public Interest Litigations (PILs) trillion BTU annually for a period of 17
were filed before the Supreme Court years. This suit is still pending adjudication
drones at KG D6 against the Company in relation to the KG in the Bombay High Court and the
onshore terminal D6 PSC, seeking reliefs in the nature of Company’s fact witnesses in the suit are to
disallowance of cost recovery, quashing be cross examined by NTPC.
Flare stack inspections are carried out GOI’s decision to approve certain gas
ARBITRATION RELATING TO ALLEGED
to check the healthiness of the system price formula and termination of PSC.
MIGRATION OF GAS
at regular intervals. The inspection The Company has submitted that the
GOI sent a notice to the KG D6 Contractor
involves major shutdown of processes, underlying issues in the PILs are already
on November 4, 2016 asking the Contractor
flare downtime, use of heavy weight subject matter of ongoing arbitrations
to deposit approximately US$1.55 billion
winches, scaffolding erection and the relating to the KG D6 Block. Matter is still
on account of alleged gas migration from
associated risks. pending in the Supreme Court.
ONGC’s blocks. RIL, as Operator, for and on
PMT ARBITRATION behalf of all constituents of the Contractor,
Arbitration was initiated by BG Exploration initiated arbitration proceedings against
and Production India Limited and RIL the GOI. The Arbitral Tribunal vide its
Action Taken
(together the Claimants) against the Final Award dated July 24, 2018 upheld
Safe, reliable and quick inspection of Government on December 16, 2010 under Contractor’s claims.
flare system with minimum human PSCs for Panna – Mukta and Tapti blocks
GOI filed an appeal on November 15, 2018
intervention using drones due to difference in interpretation of
before the Hon’ble Delhi High Court, under
certain PSC provisions between Claimants
section 34 of the Arbitration Act, against the
and Government. The Arbitral Tribunal by
Final Award of the Arbitral Tribunal and the
majority issued a final partial award (FPA),
appeal is currently pending adjudication
Scale of Impact and separately, two dissenting opinions in
before the Hon’ble Delhi High Court.
Elimination of shutdown times, the matter on October 12, 2016. Claimants
minimisation of manual intervention, challenged certain parts of the FPA before WRIT PETITION FILED AGAINST FIR IN
data accuracy and time and cost the English Courts, which delivered its ANTI-CORRUPTION BUREAU
reduction judgment on April 16, 2018 and remitted In 2014, four individuals filed a complaint to
one of the challenged issues back to the the then Chief Minister of the Government
Arbitral Tribunal for reconsideration. The of National Capital Territory of Delhi
Arbitral Tribunal decided in favour of the alleging collusion between the then
Outcome Claimants in large part vide its final partial Ministers of the Central Government and
Enabled access to otherwise award dated October 1, 2018 (‘2018 FPA’). the Company in relation to increasing the
inaccessible structures and details, The Government has filed an appeal before price of gas produced by the Company from
and actionable information during the English commercial court against this the KG D6 Block. The then Chief Minister of
shutdown period 2018 FPA. The Claimants have also filed Delhi had ordered the ACB to register the
an appeal against the 2018 FPA on limited FIR and investigate the matter.
aspects of the 2018 FPA, which were not

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 77

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Oil and Gas Exploration & Production

The Company has filed a Writ Petition domestic production, which will reduce underway which is expected to commence
before the Hon’ble Delhi High Court India’s energy import dependence. in FY 2019-20.
questioning the jurisdiction of the ACB in
Reliance has rich project execution To accrete hydrocarbon resources,
registering the FIR against the Company.
experience, including knowledge infrastructure led exploration efforts are
The Company has contended that the ACB
in deepwater oil and gas projects. being pursued in the proven petroleum
lacks jurisdiction to file the FIR. The matter
Additionally, it expects to leverage its play fairways. These pursuits would benefit
is currently pending before the Hon’ble
partnership with BP, existing infrastructure from the existing world class deepwater
Delhi High Court.
in the Krishna-Godavari Basin and current infrastructure.
LCIA ARBITRATION FILED BY NIKO downturn in the capital equipment and
CBM
(NECO) LIMITED (NIKO) service provider market.
To sustain plateau production, further
Due to Niko’s failure to pay the cash
For R-Cluster development, all contracts CBM development is being undertaken.
calls issued by RIL as Operator of KG D6
have been awarded and engineering Development activities of block SP
Block pursuant to the terms of the Joint
and fabrication activities are ongoing. (West)–CBM–2001/1 Phase II and SP
Operating Agreement (JOA), RIL and BP
Drilling and completion activity for six (East)–CBM–2001/1 block is currently
issued a Notice of Withdrawal to Niko
development wells commenced during underway. Phase II includes drilling and
in terms of the JOA requiring Niko to
the year. Majority of materials / equipment completion of more than 100 wells along
withdraw from the KG D6 PSC and JOA.
have been delivered and first offshore with an additional gas gathering station
Thereafter, Niko has initiated arbitration
installation campaign has been completed and associated water gathering stations for
proceedings against RIL and BP on
successfully. collection and processing of CBM Gas and
December 19, 2018 and the arbitration
water respectively. Phase II development
tribunal has been constituted. For Satellite Cluster development, contracts
activities are in advanced stage and is
have been awarded. Detailed engineering
expected to come online in the second half
PROJECT UPDATE and manufacturing of Subsea Production
of FY 2019-20.
KG D6 System (SPS) is in progress. Well planning
Reliance commenced the development of and preparation for drilling campaign is
BUSINESS STEWARDSHIP
three deepwater fields, R-Cluster, Satellite underway, which is expected to commence
Employee volunteering and community
Cluster and D55 (MJ) fields. First gas from in FY 2019-20.
participation are encouraged within the
R-Cluster is expected by mid-2020 followed
For MJ field development, contracting of Company. Acting as a responsible business,
by Satellite Cluster and MJ fields over
long lead items is underway. Well planning the Company also ensures productive
the next two years. These projects are
and preparation for drilling campaign is employment for members of the local
estimated to contribute upto 20% of India’s
community.

Fabrication of Subsea Structure Subsea Structure Foundation Installation

78 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

QQ ILLUSTRATION

Green Cover Medical camp Women Promoting education Improved child

Empowerment in rural areas health

Action
1,500 coconut trees Comprehensive health Enhanced livelihood Commemorating As a part of community
planted at Gadimoga check-up camp was opportunities for 100 birth anniversary of connect, two anganwadi
panchayat and organised and prescribed widows at Pedavalasala Reliance’s Founder centres Katkona and
Bhairavapalem, medicines distributed village by promoting Chairman Shri Dhirubhai Lalpur have been
Theerdalamondi and to reduce incidence and creating awareness H Ambani, district adopted by teams of RIL
Dariyalatippa villages of communicable and about backyard poultry. Level quiz competition employees and their
on the occasion of seasonal diseases by a is being organised spouses. The teams
Gandhi Jayanti and 20 member–specialist by RIL covering all work towards the basic
women members were doctors’ team. schools across the East health and nutritional
mobilised to safeguard Godavari District, Andhra supplements to children
the trees after plantation Pradesh since 2010 with with provisions of
at identified households participation from over sport materials at the
as a part of community 2,200 students from 550 centres, and promoting
ownership. schools. awareness on health and
hygiene.

Scale of Impact
Generating employment opportunities for communities and
ensuring healthy employee-community engagement

Outcome
Employee Social Responsibility has resulted in communities extending
their co-operation and assistance for the project

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 79

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance

Retail

Subramaniam V. Brian Bade Damodar Mall Akhilesh Prasad Shawn Gray Darshan Mehta

Sunil Nayak Kaushal Nevrekar Ashwin Khasgiwala

Reliance Retail has effectuated a

consumption boom in the country,
taking organised retail to the smallest
of towns and making it accessible to
middle class customers in India.
Reliance Retail continues to deliver
remarkable results as it nearly
doubled its revenues and tripled its
profits in FY 2018-19. Reliance Retail’s
inclusion in the list of top 100 global
retailers* is a testimony of its growth
and depicts the trust of consumers.
With 10,415 retail stores, presence in
6,600 plus towns and cities and
22 million sq. ft. retail space, Reliance
Retail is the largest retailer in India.
Reliance Retail is committed to its
ethos of shared prosperity–making a
difference to the life of every Indian.
Reliance Retail continues its journey
of making shopping enjoyable for the
entire family.

*
Global Powers of Retailing 2019, Deloitte
Menswear focused apparel store

80 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

STRATEGIC ADVANTAGES AND COMPETITIVE STRENGTH

DIVERSIFIED PORTFOLIO OF
STORES ACROSS VARIOUS SERVING THE PARTNER OF
CONSUMPTION BASKETS UNDERSERVED MARKETS CHOICE

 eliance Retail has developed and

R Reliance Retail has been expanding at Reliance Retail has emerged as the partner
strategically positioned a wide array of the rate of 4 stores every day for the last 5 of choice for international brands and
stores with a mindset to serve customers years, penetrating into markets unserved has established exclusive partnerships
and achieve leadership within its category. and underserved by organised retail. It with many revered international brands.
The strategy has worked well as Reliance enjoys a first mover advantage in many It operates the largest portfolio of
Retail has achieved leadership in key cities. international retail brands in India.
consumption baskets and has emerged as
India’s largest retailer.

ADAPTIVE / CUSTOMER FOCUSSED MULTI-CHANNEL

RESPONSIVE ROBUST ECOSYSTEM STRATEGY

Reliance Retail operates on a framework Reliance Retail has created an ecosystem Reliance Retail has adopted a
that fosters rapid adaptation to the ever consisting of farmers, manufacturers, multi-channel strategy and has
changing external environment whether it suppliers, supply chain and logistics integrated ‘offline-online’ models to truly
pertains to technology evolution, consumer partners, distribution partners with differentiate the customer experience.
experience or the way shopping habits are a scalable and integrated network
changing. This has helped Reliance Retail of infrastructure. This enables it to
in maintaining its market leadership by provide unlimited choice, superior value
anticipating and responding quickly to proposition, quality and unmatched
the ever evolving customer and market experience across all retail stores.
dynamics.

Destination Supermarket

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 81

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Retail

RELIANCE RETAIL OPERATING MODEL

BUYING MOVING SELLING
VENDOR ECOSYSTEM Efficient and seamless supply: Direct CHANNEL ECOSYSTEM
Comprehensive network of vendors delivery to stores from chain network, fleet of Providing anytime, anywhere, shopping
from farmers to large enterprises vehicles and logistic partners experience through stores, e-com, connected
Direct delivery to stores from suppliers in kiosks and catalogue sales; after sales service
select cases through ResQ and dedicated customer care

Buying Moving Selling

Design & develop solutions Need gap and planning Data analytics

DESIGN & DEVELOP NEED GAP AND PLANNING DATA ANALYTICS

SOLUTIONS CUSTOMERS
DESIGN ECOSYSTEM Serving individuals, kiranas,
 ombination of inhouse and
C hotels, restaurants, caterers and
external design support for B2B customers; engagement
product development through loyalty porgramme,
enriching shopping experience
through consumer insights

Leveraging technology backbone Inhouse engineering, procurement People — microservices

across entire value chain and and construction team supporting organisation with defined roles and
integrated IT systems rapid expansion responsibilities

MARKET OVERVIEW contribute 88.8% of organised retail market c) Grocery, d) Petro Retail and e)
India’s retail market is estimated at around in 2017. Reliance Retail has established Connectivity. Under each consumption
US$700 billion in 2017 and is expected to large presence across these categories to basket, Reliance Retail operates multiple
grow at a CAGR of approximately 12% over serve market opportunity and transform customer centric store concepts that
the next 4 years to reach around US$1,100 the retail landscape in India. provide superior customer experience,
billion by 2021. The penetration of organised focused assortment, attractive price value
The strategy and business model of
retail market is estimated at 9% in 2017 proposition and best quality products.
Reliance Retail has consistently helped it
and is expected to grow to 13% by 2021. Reliance Retail operates one of the most
outpace the growth of organised retail and
The organised retail market is estimated at extensive retail store networks in the world
it is fully geared up to be able to continue
around US$67 billion in 2017 and is expected backed by committed and well trained
this growth momentum in future.
to grow at a CAGR of approximately 21% manpower, robust infrastructure backbone
over the next 4 years to reach around and an integrated value chain. Reliance
BUSINESS OVERVIEW
US$145 billion by 2021. Retail has created an ecosystem that
Reliance Retail is engaged in the business
connects producers and manufacturers to
Food and grocery, apparel and accessories, of retailing products and services across
consumers seamlessly in over 6,600 towns
jewellery and consumer electronics together five key consumption baskets: a) Fashion
and cities of India through its 10,415 stores.
and Lifestyle, b) Consumer Electronics,

82 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

FASHION AND LIFESTYLE 350 cities. Reliance Retail operates multiple is a multi-brand store concept offering
The organised apparel, accessories and speciality store concepts, which cater to national and international brands. Trends
footwear market is estimated at around all income segments ranging from value to has developed a strong portfolio of in-store
US$16 billion in 2017 and is expected to mid segment and premium to luxury. brands such as Avaasa, DNMX, Netplay,
more than double to around US$35 billion Performax, Teamspirit, etc. to cater to
Trends is Reliance Retail’s flagship fashion
by 2021. Organised retail penetration the diverse tastes and preferences of
concept positioned in the value segment
in apparel and accessories category is customers. Many of these brands have
and built on the principle of democratising
estimated at approximately 24% and shown tremendous acceptance with
fashion for aspiring Indian consumers.
in footwear category, it is estimated at customers and have grown up to match
It is India’s largest apparel destination
approximately 27%. This is expected to in size and scale equivalent to established
with over 670 stores across 350 cities.
grow to in the range of 37% and 31%, national brands. In-store brands contribute
Trends stores are spread across malls,
respectively by 2021. over 70% to Trends revenues.
high streets and city centres connecting
Reliance Retail is the largest fashion with customers in best settings. Trends
retailer in India with 1,769 stores across

RELIANCE RETAIL FASHION LANDSCAPE

FASHION PYRAMID
Luxury
Affordable Luxury
Premium
Mainstream
Value

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 83

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Retail

The ability of Trends stores to cater to fine jewellery. It offers exquisitely crafted
an ever increasing number of customers gold, diamond, bridal jewellery, ornaments
comes from its vertically integrated for special occasions as well as daily wear
operating model which, allows it to control with a profuse mix of traditional and
the entire fashion value chain. Trends has contemporary designs. The stores provide a
set up in-house design studios, which, delightful customer experience guaranteed
supplemented with international design by a promise of 100% purity in quality and
houses, generates new designs on a regular transparency in prices. Reliance Jewels has
Reliance Digital–Personalising Technology
basis. Trends sources its own fabric and an inhouse design team and a dedicated
gets the designs manufactured through production facility enabling it to exercise
hundreds of vendor partners across India complete control over superior crafted through kiosks, fulfil orders, facilitate
and international markets. This translates jewellery sold through its stores. returns, replacement and refund. AJIO
into fresh fashion across stores on a regular delivers products across 17,800 PIN codes.
Reliance Brands works with international
basis.
brands in the premium to luxury segment CONSUMER ELECTRONICS
Reliance Footprint is a leading multi-brand with a focus on apparel, footwear and The organised consumer electronics
footwear chain offering over 50 prominent lifestyle categories. With a portfolio of over market is estimated at US$11 billion in
international, domestic and in-store 40 revered international brands, Reliance 2017 and is expected to more than double
brands. The store provides offers wide Brands operates the largest portfolio of to US$26 billion by 2021. Organised retail
collection of products across footwear, premium and luxury brands in India. penetration in the consumer electronics
luggage, handbags and accessories. Over the years, Reliance Brands has category is estimated at 27% and is
The stores offers high quality products emerged as a partner of choice for best expected to grow to in the range of 35% by
at attractive value proposition, making it international brands. Reliance Brands 2021.
a destination for all footwear and travel operates the largest store network of
Reliance Retail operates Reliance Digital,
needs. international retail brands in India with over
the largest consumer electronics speciality
400 stores.
‘Project Eve’, is a unique and first of its kind retail chain in India with 357 stores
experiential store concept that caters to AJIO is a curated fashion platform offering across 166 cities. Reliance Digital offers
the entire fashion and lifestyle needs of the trendiest and most unique styles from a wide range of technology products
women. Positioned in the mid to premium across India and the world. It features over and consumer electronics from mobiles,
segment, the store offers apparel, beauty 500 national and international brands laptops, cameras to large appliances such
and cosmetics, accessories, footwear, alongside an in-store brand collection under as UHD TVs, Air Conditioners, Washing
in-store salon and a café, all under one the name ‘AJIO’. AJIO operates a digital Machines and much more. Reliance Digital
roof to address entire fashion needs of ecosystem and democratises fashion for stores are located on high streets and
a woman. Since its launch in July 2017, consumers across India. AJIO operates malls, serving technology needs of all age
Project Eve has now scaled to 20 stores on an omni-channel model by providing groups, including millennials to Generation
across major cities. anytime anywhere shopping to consumers. Z and income strata across households.
It leverages many of its partner brands’
Reliance Jewels is a leading premium Personalising technology for every Indian,
network of stores to serve consumers
jewellery chain, offering a wide range of Reliance Digital is transforming the way
India shops for technology products
and consumer electronics by providing
product experience zones, wide range
of assortment across 200 national and
international brands, quality service
through ResQ, supported by trained and
knowledgeable staff and much more.
Reliance Digital has a wide portfolio of
in-store brand products under 'Reconnect',
'JioPhone' and 'LYF' brands. The brands are
built on the premise of product innovation,
unmatched user experience, superior
quality and give customers a wider choice
Curated Fashion and lifestyle of products that serve their needs.

84 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

ResQ is Reliance Digital’s service arm Reliance SMART is the destination various categories such as staples, food,
and India’s only ISO 9001 certified supermarket store, dealing in fresh foods, FMCG, home and personal care and general
electronics service brand. ResQ staples, items of daily needs, home and merchandise. Best Farms, Good Life, Masti
provides multi-brand, multi-product personal care items, apparel and general Oye, Kaffe, Enzo, Mopz, Expelz, Home One,
service, including installation, repairs, merchandise with attractive price-value Graphite, RelGlow, etc. are some of the
maintenance and comprehensive ResQ proposition. Reliance SMART operates 154 brands that have developed a strong liking
care plans to consumers, thereby providing stores across 96 cities. by consumers. These brands are available
a one stop solution to consumers. across Reliance Fresh, Reliance SMART and
Reliance SMART stores are operated across
Reliance Market stores.
Jio Store is a small store concept offering key cities in high traffic areas such as
range of mobility, connectivity and smaller residential catchments, city centres, Reliance Retail operates on a farm-to-fork
sized tech products such as mobiles, malls, etc. with a focus to serve every grocery value chain. It directly partners
laptops, cameras, memory cards, etc. household’s recurring food and non-food with a large number of farmers and small
It acts as an interface for providing consumption. The stores operate on an vendors, which ensures and enhances
Jio’s connection, recharge services and everyday low-price strategy and promises quality of produce through ground level
resolving customer concerns. These stores 365 day savings with a minimum 5% support, reduction in wastages and quicker
are located in high traffic areas such as discount on maximum retail price (MRP) of movement of produce to consumers,
high streets, commercial complexes, etc. the products, attractive promotions and a thereby benefiting all.
across 6,600 plus towns and cities in India. wide variety of products to choose from.
PETRO RETAIL
Jio Stores leverage this deep-rooted
Reliance Market is the largest chain of Reliance Retail operates 516 owned Petro
reach by depicting, demonstrating and
cash and carry stores serving thousands Retail outlets. These outlets are spread
selling Reliance Digital’s catalogue of
of kirana, hotel, restaurants and catering across India with a focus on serving highway
consumer electronics and technology
(HORECA), small and medium institutional corridors between major cities.
products to consumers. Nearly 10%
partners and households across fresh
of Jio Stores’ revenues come through Reliance Petro Retail outlets yield
foods, FMCG products, staples, non-food
catalogue sales. Thus, it fills the much significantly higher volumes than industry
and general merchandise items. It operates
needed demand-supply gap for consumers average led by efficient processes,
46 stores across 42 cities.
based in remote pockets of India, thereby technology backbone and well-trained
enabling the ease of living for every Indian. The core business model of Reliance Market employees. It offers diesel, petrol and LPG to
is to serve all kinds of small / large market its customers with a focus on serving clean
GROCERY
participants across the trading value chain and pure fuel.
The organised food and grocery market
through efficient sourcing and distribution,
is estimated at US$16 billion in 2017 CONNECTIVITY
including last mile distribution to
and is expected to more than double to Reliance Retail works as the Master
member partners.
US$41 billion by 2021. Organised retail Distributor for Jio connectivity services.
penetration in the food and grocery With a focus to provide quality produce to The distribution network comprises over
category is estimated at 3% and is consumers at affordable prices, Reliance 7,600 Jio stores. These in turn work with over
expected to grow to in the range of 6% Retail has developed in-store brands, which 1 million retailers across the country for new
by 2021. provide a wide range of offerings across customer acquisition and recharges.
Reliance Fresh is India’s leading chain of
neighbourhood stores with 378 stores
across 57 cities. Rated as India's Most
Trusted Grocery Brand by Brand Trust
Report 2018, Reliance Fresh offers fresh
fruits and vegetables, staples, cereals,
and items of daily needs to consumers at
attractive prices with a focus on providing
quality produce.
Reliance Fresh stores are placed in
residential neighbourhood catchments,
which gives it the ability to reach out to a
set of customers and serve them for their
daily needs.
Reliance SMART

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 85

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Retail

INTEGRATED VALUE CHAIN

Behind all of Reliance Retail’s stores and omni-channel initiatives is its integrated value chain that connects farmers, small producers,
manufacturers, national and international brands to consumers through its pan-India presence of stores, B2B ecosystem and service network.

RELIANCE RETAIL INTEGRATED VALUE CHAIN ACROSS MULTIPLE CONSUMPTION BASKETS

FIBRE TO WARDROBE FASHION VALUE CHAIN

Design and Sourcing Fabric procurement: Contracted capacity Controlling quality Robust planning from
Own team Buying offices in India and with hundreds of vendor of products through demand to design
Design houses in India abroad, buying from village partners, regional inspection and lab tests
and abroad and cottage industries, producers
small and big enterprises

Integrated network of Network of supply chain Ensuring fresh fashion

distribution centres and and logistics partners at stores
transport fleet

CONSUMER ELECTRONICS VALUE CHAIN

Strong partnerships with over 200 national and Research and Robust demand Integrated network ResQ’s express
international brands – enabling exclusive and product design and inventory of distribution service and support,
latest products, building customer experience teams building planning, ensuring centres and network of service
zones compelling portfolio latest products are transport fleet partners–timely
of in-store brand available at stores delivery and
products every season installation

FARM TO FORK GROCERY VALUE CHAIN

Network of farmers, Buying from FMCG Integrated network Leveraging Ensuring availability Leveraging store
growers, producers majors, small and of collection centres, sophisticated tools of fresh food at stores network, delivering
and small scale large enterprises. distribution centres, for demand planning throughout the day products to the
industries. Access to cold storage and and inventory doorsteps of
Arrangements with
agriculture produce transport fleet replenishment consumers across
vendor partners
markets select cities
for developing and
sourcing in-store
brand products

86 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

FINANCIAL AND OPERATIONAL PERFORMANCE

FY 2018-19 FY 2018-19 FY 2017-18 % change in
Parameter
(` in crore) (US$ in million) (` in crore) y-o-y
Revenue 1,30,566 18,880 69,198 88.7%
PBDIT 6,201 897 2,529 145.2%
PBDIT Margin (%) 4.7% 4.7% 3.7%
EBIT 5,546 802 2,064 168.7%
EBIT Margin (%) 4.2% 4.2% 3.0%

Reliance Retail achieved a turnover of of Reliance Retail demonstrates the During the period, Trends rolled out 65
`1,30,566 crore in FY 2018-19, an increase leadership position it has established in small town Trends stores, thus further
of 88.7% y-o-y. The business delivered the market. Reliance Retail’s growth is not penetrating in to Tier III/ IV towns. The
an EBIT of `5,546 crore for FY 2018-19, only noticeable in the Indian context but concept has received encouraging
more than doubling over previous year. also at a global scale. Reliance Retail has response from consumers, paving way
Core Retail (excl. Connectivity, Petro-Retail) been ranked as the 6th fastest growing retail for its expansion. Trends Man and Trends
PBDIT margin improved to 7.0% vs company in the world and features 94th Women concepts continue to gather
6.0% last year. in the list of Global Powers of Retailing by strong traction from consumers and have
Deloitte based on FY 2017-18 revenues. expanded to 10 stores and 21 stores,
Reliance Retail operated 10,415 retail
respectively. Trends is the largest and
stores in over 6,600 towns and cities During the period, Reliance Retail formed
fastest growing fashion retail chain in India
covering an area of 22 million sq. ft. as several long-term strategic partnerships.
and has opened more than 125 new stores
on March 31, 2019. Additionally, Reliance These partnerships add significant value to
during the period.
Retail operated 516 petro retail outlets as its offerings across all consumption baskets.
on March 31, 2019. During the period, Reliance Retail acquired
• Partnership with Disney to develop and
from ITC Limited all rights, title, interest,
BUSINESS PERFORMANCE market co-branded (Disney and Reliance
trade-marks and intellectual property in
Reliance Retail witnessed resilient growth in-store brand) SKUs across various
the brand ‘John Players’. John Players
across all consumption baskets during categories such as food, fashion, toys and
is a mid-segment menswear brand with
FY 2018-19. It continued accelerated much more
national presence.
expansion of stores and operationalised • Reliance Brands formed an exclusive
more than 2,800 stores across all partnership with Mothercare, UK The curated online fashion destination
consumption baskets during the period. along with the purchase of the current AJIO continued to grow with strong
A record of over 500 million footfalls was Mothercare India business customer traction during the period.
received during the period, a growth of • Genesis Luxury Fashion and Genesis It features more than 1,30,000 options and
44% y-o-y. Colors, which became a subsidiary of witnessed nearly 2/3rd revenue from repeat
Reliance acquired exclusive rights for customers. AJIO mobile app continues to
REVENUE MIX–FY 2018-19 (%) Salvatore Ferragamo, an Italian luxury be one of the top shopping apps on
brand Google Play Store and Apple iStore with
10.2 17.9 • Reliance Brands announced a partnership over 12.7 million app downloads during
with Replay Jeans, Italian leader in the the period.
premium denim segment
AJIO implemented omni-channel
• Reliance Brands announced a partnership
initiatives during the period whereby 555
with Williams-Sonoma to bring Pottery
Trends stores were integrated for online
33.5 30 Barn, Pottery Barn Kids and West Elm to
order fulfilment, return and refund. AJIO
India
also launched AJIO Gold during the period,
In Fashion and Lifestyle, Trends witnessed which offers a collection of premium and
strong growth backed by accelerated store luxury brands such as Superdry, Steve
8.4 expansion and strong same-store sales Madden, Dune, DC, Scotch and Soda, Gas,
 Grocery   Consumer Electronic growth during the period. Trends continued and many more.
 Fashion and Lifestyle its mission to democratise fashion across
Reliance Brands launched a new
 Connectivity   Petro Retail India. More than 2/3rd of Trends stores
multi-brand store ‘The White Crow’
are now serving Tier II and III cities and
featuring brands like Diesel, Marc Jacobs,
Reliance Retail operates more stores than generating strong growth from these
Onitsuka Tiger, etc. The White Crow is a
any other organised retailer in India. markets.
destination store for the world’s finest
The FY 2018-19 revenue and profits
international brands.
Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 87
MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Retail

Reliance Jewels opened over 80 stores design and develop ‘solutions’ than just to provide anytime, anywhere shopping
during the period. It now operates 143 products to address demands of aspiring experience to consumers. Reliance
stores / Store-in-Stores (SIS) pan India. consumers, follow up and periodically Retail will further develop and enhance
assess the consumer feedback. core capabilities such as mobile
In Consumer Electronics, Reliance Digital
apps, social media linked interactive
witnessed strong growth driven by robust Reliance Retail is rightly positioned to
app features, delivery and fulfilment
customer demand, wider coverage, exploit this opportunity and transform
infrastructure, etc. to provide superior
effective marketing communication and the retail landscape in India. Reliance
omni-channel solutions to connected
rapid store expansion during the period. Retail has been growing at a rapid pace
and mobile consumers across all
It continued to outpace the market growth with revenues growing over 7 times and
consumption baskets.
across key categories of mobiles, laptops, EBITDA growing over 14 times in the last
UHD TVs, Air Conditioners, Washing five years. Reliance Retail aims to continue c. Strengthening in-store brand portfolio
Machines, etc. Reliance Digital continued this journey of rapid growth. Following key Developing a set of robust in-store
to delight customers by upgrading store drivers will form growth pillars as business brands across consumption baskets
environment to enhance customer marches ahead: and its acceptance by consumers will
experience, aggressive opening price provide Reliance Retail an edge in terms
a. Continued expansion of physical store
points and focused promotions. of generating sustainable demand,
presence
growing revenues and improving
In Grocery, Reliance Retail witnessed Reliance Retail has opened more than
profitability. The growing market
strong growth across staples, fruits and 10 stores a day over the last 2 years to
opportunity provides tremendous
vegetables, home and personal care, cross 10,415 stores across 6,600 plus
potential to create wider portfolio of
confectionery and snacks and general towns and cities with careful planning
in-store brands across multiple
merchandise categories. It strengthened and execution. This provides Reliance
categories, which can serve consumers
in-store brand portfolio with new product Retail a first mover advantage across
through Reliance Retail’s physical
launches across food FMCG, home so many Tier 3 and Tier 4 towns.
reach and distribution. Reliance Retail
and personal care, staples, luggage, Reliance Retail will continue to invest
would continue to innovate with
disposables and stationary categories. in expanding the existing store network
in-store brands through a solution-
A glimpse of new product launches is across all consumption baskets.
based approach to share increased
depicted in the below image. Reliance
b. Integration of online and offline value with its supply partners and
Market saw strong growth backed by
channels connecting everyone, customers.
growth in business with Kirana and
everything, everywhere
HORECA members. d. Enhancing customer experience
To further supplement the reach of
Reliance Retail operates with a vision
physical stores, Reliance Retail has
OUTLOOK to be the most admired and successful
created an online channel for its
With the world’s largest millennial retailer that enhances the quality of life
consumer electronics and fashion and
population embracing digitisation, social of every Indian. With this ethos, Reliance
lifestyle businesses. The physical stores
media and technology, India’s retail Retail has always endeavoured and will
are now being equipped with kiosks
trade has no longer remained a mere continue to provide superior customer
so that consumers can browse endless
buy-move-sell architecture. It is imperative experience through continuous
aisles and shop for products which may
that retailers deploy sophisticated tools improvements in store environment
not be readily available at stores. Stores
such as artificial intelligence, analytics, and create consumer focused store
are also being equipped to handle
automation, etc. to identify existing concepts.
delivery, return, replacement and refund
need gaps, foresee future requirements,

In-store brand products

88 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

Further, Reliance Retail aims to enhance • People with disabilities usually find it Retail has been able to create work
its core capabilities, including leveraging extremely challenging to get jobs in opportunities in thousands of small
customer insights through use of India. However, Reliance Retail employs towns and spread avenues of livelihood
sophisticated tools and much more to over 1,000 Persons with Disability (PwD) for such families.
cater to the ever increasing demand of in various roles at store level. PwD • Reliance Trends’ leading position in
surging India and consolidate its market employees bring immense potential and India’s fashion apparel market is backed
leadership across all consumption value to the workplace and their attrition by its ‘Make in India’ commitment.
baskets and store concepts. rate is the lowest in the Company. The This year, Trends sourced more than
Company has laid down focused hiring 3 crore metres of fabric from Indian
BUSINESS STEWARDSHIP strategies to ensure steady growth of producers. Reliance Trends works
Reliance Retail operates its business these numbers. closely with over 400 vendors across
keeping societal well-being as a key • Urbanisation has been on a rise in India India, providing them with committed
objective. Few of the social initiatives that as more and more people from small volumes, educating them on modern
demonstrate how Reliance Retail is making towns are migrating to larger cities in manufacturing techniques and
a difference to the society are captured search of work opportunities. With the supporting them to enhance productivity
below: spread of Reliance Retail store network and quality.
in 6,600 towns and cities, Reliance

QQ ILLUSTRATION

DIVERSITY, EQUITY AND INCLUSION

Reliance Retail’s HR policies carry an agenda for Diversity, Equity and Inclusion across three pillars of Employment, Engagement
and Empowerment.

Employment Engagement Empowerment

Action Action Action

Reliance Retail is an equal opportunity Rigorous employee training of 1-3 weeks Launching Womens Resource Groups
employer, employing without any covering all SOPs/Processes before (WRG), which are steered by senior
discrimination with respect to age, joining the shop floor; focused leadership women colleagues to guide and mentor
gender, caste or disabilities. Furthermore, development and step-up programmes women through their careers, mentoring
the Company celebrates diversity for employees and particularly for young mothers returning from maternity
and promotes inclusivity through women; same training and benefits for all breaks
several leadership programmes such employees including PWDs
as 'Saksham' for PwDs and 'Jagriti' for
female employees

Impact Impact Impact

As of March 31, 2019, Reliance Retail 24 women taking over store leadership role Promoting and empowering women in
has 22% women employees pan India, in Reliance Fresh, Reliance SMART the workplace
over 1,000 PwD employees ; offered and Reliance Market
employment to nearly 40,000 unskilled
resources during FY 2018-19

Outcome Outcome Outcome

Equal opportunity, fairness and equity Attrition dropping by 33% and customer Safety and security for women and PwD
in employment practices, which ensure complaints reducing by 50% staff in all locations
customer satisfaction

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 89

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance

Digital Services

Sanjay Mashruwala Mathew Oommen Pankaj Pawar Kiran Thomas Harish Shah Jyotindra Thacker

Anish Shah Anshuman Thakur Rajneesh Jain V. Sridhar Ashish Lodha Shyam Mardikar

Anuj Jain Prateek Pashine Aayush Bhatnagar

Jio is the fastest growing digital company globally with

306.7 million subscribers as of March 31, 2019. Among
the many accolades it has received since inception, Jio
was ranked as the top company globally on Fortune's
'Change The World' list that ranked companies that have
helped the planet and made an important social impact.
The whole-hearted acceptance of Jio’s digital services is
evident from over 3 Exabytes per month of data that is
carried on its wireless network.
Jio has been the key catalyst in the creation of a
broadband data market in India and is now ranked
#1 amongst mobile telecom operators in the country
by Adjusted Gross Revenue (AGR). Following up on its
success in wireless, Jio is now aiming to catapult the
wireline infrastructure and services in India to global
standards, with the launch of its FTTH and Enterprise
services. Jio continues to build a digital ecosystem
spanning across media and entertainment, commerce,
financial services, education, healthcare and agriculture
through group affiliates.
Jio remains committed to the Digital India campaign
with focus on providing world class digital services at
affordable prices to every citizen of the country.
Connecting lives through JioPhone

90 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

STRATEGY AND VISION

Jio is determined to connect everyone and everything, everywhere – always at the highest quality and the most affordable price. In this
context, the strategy and vision is to completely digitise the customer lifecycle. Through platforms held by group affiliates, Jio will offer
not just connectivity solutions but also services across media and entertainment, commerce, financial services, education, healthcare
and agriculture.

COVERAGE DATA QUALITY AFFORDABILITY AGILITY

Coverage refers to Average per capita data India has been a supply Affordable and simple Jio’s adoption of agile
anytime, anywhere consumption on Jio’s constrained market pricing plans have been model while developing
mobile broadband networks is nearly with limited network the key to the large-scale its systems has
access. Jio’s 4G coverage 11 GB per month with infrastructure. Jio adoption of Jio services. Jio supported its ability to
at present is greater potential upside from offers services on an has been able to offer these scale and adapt in an
than 2G coverage new use cases coming all-IP, LTE network with on the back of superior orderly manner.
in India and is fast up every day. best-in-class customer technology based operating The same was
approaching its target service, easy app-based efficiencies, enabling it to demonstrated post
of 99% population customer interaction offer services at the most discontinuation of
coverage. This coverage for query resolution and affordable price. Aadhar based e-KYC.
is backed by pan India recharges, and AI based Jio implemented the
4G spectrum across bots to provide seamless alternative digital KYC
three bands and the onboarding and service process seamlessly in a
best fiber and tower experience. timely manner, without
infrastructure in the affecting its operations.
country, providing the
best network experience
and farthest reach.

Media and Entertainment Commerce Education Healthcare Agriculture

JioTV O2O platform Digitally enabled Overcome deficit of Combine digital tools
JioCinema Enable 20 million small education to overcome physical infra with wisdom of farmers
JioSaavn merchants to compete infra challenges Telemedicine, Tech for water
JioNews with organised retail Connect 58,000 colleges Tele-radiology, conservation, soil
Network18 Data Analytics and AI for and 1.9 million schools e-Diagnostics, Genomics management, precision
BookMyShow consumer insights Infra for 200 million Long gestation farming
children in 2 years opportunity

BEST IN CLASS CONNECTIVITY

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 91

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Digital Services

MARKET ENVIRONMENT AND Data Localisation – Jio has been a strong Last mile connectivity and intracity fiber
OUTLOOK supporter of local storage of data, which networks will be a key differentiator. In this
Adoption of VoLTE – India now has over is critical for national interest and security context, Jio is well positioned to tap this
500 million mobile broadband data given the increasing sophistication of virtually greenfield opportunity to offer
subscribers, buoyed by Jio’s entry and cyber-attacks. Data localisation will also FTTx services with its extensive layout of
subsequent adoption of its services. spur investment in creating server and fiber network and customer touch points
Jio’s VoLTE offering on its fully dedicated cloud capacity in India, incentivising across 1,600 cities.
IP-networks has prompted an industry research and development and creating
wide transition from Circuit Switched employment in line with the Government of BRIDGING THE URBAN
technology to VoLTE (Voice over LTE), and India’s 'Make in India' initiative. RURAL DIVIDE
deeper penetration of 4G networks. Device India has set new incentivising standards
Jio believes that Indians are the true
ecosystem too has seen a transition with for mobility led inclusion, driven by
owners of their data and the ownership
100% of the smartphones shipped into a combination of private and public
should not be transferred to any corporate
India now being 4G enabled. initiatives. Jio realises that reducing
entity. Without the consent of the user,
the digital inequality is crucial to
Data upsurge – Adoption of LTE and no data should be collected, processed or
ensure equal access to information and
improving device ecosystem has led to used by any corporate. This would require
knowledge, as well as foster innovation
a transition in data consumption trends, a regulatory framework to ensure that
and entrepreneurship. Jio has been a key
with more than 90% of wireless data in the corporates are taking adequate measures
catalyst for data usage across geographies
country carried on 4G network now. There to ensure data protection.
and strata of society with its deep network
has also been a surge in video usage with
Wireline networks – Wireline remains a coverage and affordable data plans.
70% of all data traffic on Jio network being
huge opportunity in India, given that fixed This has been the primary reason for the
used for video.
broadband penetration is at less than 7% data boom that the country has seen over
A combination of increasing device of households, with most being served by the past two years. Prior to the launch
and network penetration, and higher legacy infrastructure and technology. Fiber of Jio services, the total mobile data
affordability is likely to result in further penetration at less than 2% is significantly traffic across all networks in India was
increase in data demand across wireless lower than global benchmarks. Given the 0.2 Exabytes per month. At present, Jio
networks in India. As per data in the Cisco trend in mobile broadband consumption network alone carries over 3 Exabytes per
VNI report, mobile data in India is expected wherein close to 70% of data is consumed month, with the industry data traffic being
to grow 9x during FY 2017-22. Government’s indoors, need for high speed fiber more than 5 Exabytes per month.
strong policy framework and push towards connectivity at homes and enterprise is
‘Digital India’ is helping in this rapid well established.
transition towards digital economy and
society.
Regulatory impact – From regulatory INDUSTRY DATA USAGE (Crore GBs, Quarter Ending)
perspective, TRAI had set a definitive path
4G Others
towards eliminating Interconnect Usage 140
Charges (IUC) with effect from January 1,800 146 1,445
1, 2020. This will hasten the adoption of
1,600 158 1,282
more efficient technologies like VoLTE,
which have a negligible cost for carrying 1,400 155
1,097
and servicing essential voice services. Jio
1,200 887
has been a pioneer in the rollout of digital 138
technologies and this sets a clear path 1,000 120 669
forward for an industry wide rollout. 107
800 532
81
TRAI has also set the ball rolling for 5G 50
436
600 44
spectrum auctions in India with availability 340
297
in newer frequency bands like 700 MHz 400 47 243
and 3,300-3,600 MHz. Jio with its 5G
200 27
ready network would play a key role in
development of the 5G ecosystem in the 0
Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Mar-19
country, based on market dynamics.

92 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

India is the second largest smartphone As per EIU forecasts, Indian households JIO – AN INTEGRATED DIGITAL
market in the world after China, with have been witnessing an upward trend in SERVICES FRANCHISE
approximately 400 million smartphone their disposable income for the last few Jio’s transformative entry and collaborative
users. Notwithstanding, smartphone years. Deloitte expects that rising affluence approach across the consumption value
penetration has been low, constrained will drive adoption of internet-based chain has catalysed industry transition
by low affordability and adoption in rural services. Supported by affordable network towards convergence of wireless, wireline,
areas. This should improve as device prices and devices, India’s young population is set media entertainment and other value-
go down and per capita incomes increase. to lead the data revolution in the coming added services.
JioPhone has played an important role in years as untapped markets start adopting
providing the power of data and internet to more digital services.
rural India and the lowest economic strata.
The 'Monsoon Hungama' plan for JioPhone
has been very successful in driving first
LARGE HEADROOM FOR RURAL INTERNET PENETRATION (%)
time adoption by mobile internet users,
especially in rural areas. Also, Government 70 59.2 57.1
initiatives on Digital India has been a big 56.3 58.5
driver along with deeper rollout of LTE 60 50.8
48.1
networks. 50
Despite this, rural India remains a highly 40
underpenetrated market and presents 23.9 25.4
30 21.8
a huge opportunity for digitisation. 13.7 14.6
According to data from TRAI, rural mobile 20 12.8
penetration stands at 57% while rural 10
internet penetration is 25%, indicating that
rural remains primarily a voice market. 0
Sep-15 Sep-16 Sep-17 Sep-18 Dec-18 Mar-19
Rural broadband penetration is even lower Rural mobile penetration  Rural internet penetration
at 21%.

JIO LEADING FROM FRONT

ADVANTAGE INDIA

Robust Demand Attractive Opportunities Supportive Industry Policy Growing Middle Class
World’s 2nd largest Rural teledensity at 57.13% Proactive efforts to Young population and
telecommunications market (March 19) transform India into a global increasing disposable income
with 1,161 million subscribers 2nd largest internet market telecommunications hub Quick adoption to digital life
(March, 2019) globally New National Digital 750 million internet users by
70% of population lives in GoI launches Digital India Communications Policy 2018 to 2020
non-metro, non-urban areas programme set the tone for full digitisation 1.25 billion broadband
and is not fully data enabled Education, healthcare, path subscribers by 2024*
Increasing consumption of data commerce and agriculture will *Source: Ericsson Mobility Report 2019
and media on mobile networks be connected through internet

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 93

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Digital Services

NETWORK BUILT FOR COVERAGE AND Jio with its partners is a part of two undersea Virtualisation (NFV) have been incorporated
CAPACITY cable network consortiums: into its design. Combined with significant
Jio has built the country’s largest all-IP in-house data centre capacity already
• BBG (Bay of Bengal Gateway), a state of
data network on 4G-LTE technology. The built and investments into CDN (Content
the art 8,100 kms undersea cable system
network has been built as a mobile video Distribution Network), the network
providing direct connectivity to SE Asia
network, provides VoLTE and is future does not just support superior customer
and Middle East, then onward to Europe,
ready for transition to 5G and beyond. Jio’s experience but is also future ready, with
Africa and Far East. This strategically
target is to reach 99% population coverage, potential transition to 5G in cost and time
important undersea cable facility has a
significantly ahead of any 2G network efficient manner.
landing facility in Chennai
coverage in India. It is also augmenting
• AAE-1 (Asia Africa Europe) stretches over NETWORK AND PLATFORM INNOVATION
capacity by adding new sites, fiber
25,000 kms from Marseille, France to Jio has been on the forefront of innovation,
backhaul and small cells.
Hong Kong. This is the longest 100 Gbps be it for network technology, platforms
BEST IN CLASS NETWORK QUALITY undersea cable system with 21 landing or consumer services. Till date, the
Jio’s wireless network now carries stations across Europe and Asia. In India, it company has filed 100 patents for the
over 3 Exabytes of data and nearly has a landing station in Mumbai pioneering initiatives it has undertaken,
25,000 crore minutes of voice per month. of which 18 have been granted. In FY
Across the 306.7 million subscriber base, JIO DIGITAL VISION 2018-19 alone, the company filed for 35
this translates to a per capita usage of 10.9 patents and was granted 12. These patents
Gigabytes and 823 minutes per month. span across devices, network, cloud,
DEMOCRATISING DATA
Despite this growing traffic, call drop rate digital media, branding and customer
on Jio networks remains the lowest in Most affordable experience. Jio’s patents cover areas of
the industry and data download speed data in the world – ensuring access to cutting-edge technology including video
is also by far the fastest in the industry. the common man bots, blockchain, NFV (Network Function
Best value offering in data
According to TRAI’s data, Jio is the fastest Virtualisation) and eMBMS (Evolved
4G operator with highest average download Multimedia Broadcast Multicast Services).
Connectivity for every Indian
speed for the last 27 months – registering
Rich bouquet of digital services TRULY DIGITAL JIO PLATFORMS
average download speed of 20.8 mbps Affordable devices with data Since its inception, Jio has taken a platform
on its network, more than twice to that connectivity and applications approach to integrate digital experience
of the nearest operator (at 9.5 mbps).
and services with Jio Digital Platforms.
The entire scale up of Jio has come High quality data This has made all systems and processes
alongside sustained network performance Uninterrupted and high speed data
extremely modular resulting in quick
underlining its quality and capacity. access anywhere, anytime
time to market for any new solution or
High speed video ready network
LIBERALISED SPECTRUM ACROSS system changes. This was evident in recent
THREE BANDS suspension of Aadhar based eKYC process
Jio’s network is designed to seamlessly Widest network in India during the year, when the new process
work across 800 MHz, 1800 MHz and 2300 Spread across cities and villages was developed and deployed across the
To cover >99% of India’s population
MHz frequency bands. In fact, each of the country in less than 2 weeks.
sites on the network radiates all three
Taking the same approach further,
bands. The combined spectrum footprint BEST IN CLASS NETWORK
JioCloud is now hybrid cloud ready and
of 1,108 MHz (uplink + downlink) across ARCHITECTURE
migrated to an open source. To keep pace
the three bands in 22 circles provides Investment in infrastructure and innovation
with technology transitions, the company
significant network capacity and deep are crucial drivers of economic growth
has created horizontal organisational
in-building coverage. Average life of the and development, and Jio has been a
frameworks and communities to
spectrum portfolio is over 14 years with all forerunner in deploying world class digital
institutionalise all current and ongoing
spectrum liberalised, which can be used to infrastructure, while constantly thriving
learnings at Jio.
roll out any future technology. for innovative solutions to deliver the
best services for its subscribers. Jio’s next
UNDERSEA CABLE NETWORK FOR
generation network is amongst the best
GLOBAL CONNECTIVITY
in the world. Built from the ground up to
Jio has been actively creating a multi
support high data usage and low latency,
terabit capacity international fiber network.
advanced features such as Software Defined
Networking (SDN) and Network Function

94 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

JIO-INTEGRATED DIGITAL SERVICE FRANCHISE

All-IP Network Rich Capacity Seamless Service experience

Instant call connectivity, Sufficient capacity for every Seamless Voice,
minimal call drop, user on the network, at all Video and Messaging
unmatched HD quality times (combination of fiber and experience
spectrum)

Seamless In-building coverage Ubiquitous Coverage footprint

Superior indoor coverage using India’s largest LTE network Superior Data experience
Macro and Small cells, backed by deployment with FDD and TDD Sufficient throughput for the
Pan India FTTH roll out spectrum (800/ 1800/ 2300 Bands) highest end applications
with fiber backhaul

CREATING A MICROSYSTEM WITH NEW recharges. In addition to this, services are the most popular in their respective
ENTREPRENEURS also sold through the MyJio application, the categories and have won various accolades.
India is fast emerging as an innovation most popular self-care application in the Most popular ones include JioTV (630+
centre for new technologies. Young country. channels of live and catch up TV, across
entrepreneurs are using technology to 16 languages and, 11 genres), JioCinema
MAJOR CONTENT PARTNERSHIPS
solve customer problems across the strata (Video on Demand, 10,000+ movies,
IN FY 2018-19
of population. Jio, because of its best in 1,20,000+episodes, 70,000+ music videos),
To improve customer engagement on
class 4G network has been a key catalyst for JioMoney, JioNews (Personalised news
the network, Jio has entered into a series
this ecosystem. Taking this a step further, app with use of AI and ML algorithms
of content partnerships in FY 2018-19
Reliance is nurturing and developing this consolidating various content formats
to provide best in class content to its
ecosystem further through investment and including Live TV, Short videos, News
subscribers. These include:
collaboration. articles, Magazines and Newspapers) and
• Partnership with Disney to offer content JioChat. Through the MyJio app, digital
In FY 2018-19, through group affiliates
from Disney, Pixar, Marvel, Lucas Film self-service and e-Care capability is offered,
Reliance has invested in companies
on JioCinema app. The app hosts a which proves to be a cornerstone of Jio’s
like C-Square (software), EasyGov
dedicated Disney branded section on the Digital proposition for its customers.
(e-governance), Grab-a-grub (logistics),
homepage with content spanning across
Haptik (chatbot solution), Netradyne (AI, During the year, JioMusic and Saavn were
movies, animation and short series
logistics), NEWJ (digital and social media), brought together into a single application,
• Agreement with Star India for a period of
Radisys (5G, IoT), Reverie (language as a creating industry leading user interface
5 years, for the telecast of all BCCI Cricket
service platform), Sankhyasutra (simulation and analytics with a library of over 45
matches (T20, One Day Internationals,
services) and SkyTran (transportation million tracks in 16 languages. The platform
International Test Matches, BCCI
technology). Each of these investments is differentiated through the exclusive
Domestic Tournaments) on the JioTV
have been carefully selected to fit into content produced via its Artist Originals
platform
Reliance digital ecosystem to enhance and Program. This is the first Jio OTT (Over
keep its offering across mobility, homes SUITE OF DIGITAL SERVICES The Top) content application which is also
and enterprises future ready. Jio’s all IP network is fully enabled and available to non-Jio customers across the
capable of delivering content focused world, on a freemium model. JioSaavn
DISTRIBUTION TO COVER THE LENGTH
services. This enriches customer experience has global collaborations with leading
AND BREADTH OF THE COUNTRY
due to the network’s ability to carry and artists. During the year JioSaavn’s Artist
Reliance Retail works as the Master
deliver multimedia content. Jio through Originals 'AO' facilitated collaboration
Distributor for Jio connectivity services.
its group affiliates has created a rich suite between Bollywood composer Pritam and
The distribution network comprises of
of applications and tools that encompass Marshmello, which got 70 million views
over 7,600 Jio stores. These in turn work
entertainment, news, information, of ‘BIBA’ track on OTT platforms, and AO
with over 1 million retailers across the
commerce and self-service. Jio’s digital collaboration between global hip hop
country for new customer acquisition and
suite of applications are already amongst legend Nas and India’s two biggest rap
stars, Divine and Naezy.
Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 95
MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Digital Services

SUITE OF DIGITAL APPS FOR THE CONSUMER

MyJio JioTV JioCinema JioMoney

Full service app with 

Live and catch up TV – 
Video on demand– 10,000+ Jio Money is a digital payment
MACD – Prepaid Postpaid 16 languages, 11 genres, 630+ movies, 1,20,000+ episodes, platform. Jio Payments bank is
payments, Voucher, Loyalty, channels, 130+ HD channels 70,000 + music videos, Exclusive a JV with SBI where live trials
Troubleshooting, Vitual Assistant Web Originals are in progress.

JioNews Embibe JioChat JioSaavn

Intelligently packaged Unique data driven AI based Fully encrypted messaging, HD Launched integrated JioSaavn
consolidated and personalised education services platform quality group voice and video app with refreshed UI/UX
news app with use of AI and ML catering to Engineering, conferencing, events and 45+ million tracks under license
algorithms Medical, Banking and Class 8-10 play-along initiatives across 16 languages with key
Varied contents formats differentiation through Artist
including Live TV, Short videos, Originals Program
News articles, Magazines and
Key initiatives include new
Newspapers
original content releases and
175+ Live channels, 900+
programmatic ad deals and live
magazines, 300+ newspaper
lyrics/karaoke
editions

RIL also acquired a majority equity stake stay options, routes and maps, win-win outcome for Local Cable Operators
in Indiavidual Learning Pvt Ltd (Embibe), family locator, multimedia devotional (LCOs), consumers, content providers
a leading AI-based education platform content, news alerts and entertainment, and overall ecosystem. Through these
leveraging data analytics to deliver among others. investments, Jio will be strengthening
personalised learning outcomes to each the 27,000 LCOs aligned with DEN and
WIRELINE NETWORK TO ENHANCE
student. The investment in Embibe Hathway to provide Jio Home solutions
CONNECTIVITY
underlines Reliance's commitment to millions of homes. This will accelerate
India currently has only 19 million
to developing the education sector in Jio’s commitment to provide services to 50
households (6.3% penetration) with
India and the world, making education million homes in the shortest possible time.
fixed broadband connections, including
accessible to the widest possible group of
less than 2% fiber connected households. DEMERGER OF TOWER AND FIBER
students by deploying technology. Reliance
Jio has set out a target to connect 50 ASSETS
aims to connect over 1.9 million schools
million homes across the country with Board of Reliance Jio Infocomm Limited
and 58,000 universities across India with
its GigaFiber services. These services (RJIL) approved the demerger of its passive
technology, while strengthening Jio's
would include home broadband, wireline, infrastructure, tower and fiber assets into
leadership position as a digital technology
content and smart home IoT solutions. Jio two separate SPVs. The scheme of the
company.
GigaFiber is designed to provide fast and demerger was effective from March 31, 2019
During the year, Jio also came out with a secure ultra-broadband home experience post all requisite internal, shareholder, debt
unique and differentiated offering, Kumbh to the Indian audience. holder and regulatory approvals. The assets
JioPhone to enrich the spiritual experience would be held by a separate SEBI registered
To accelerate this rollout, RIL has made
of devotees visiting the Kumbh. The Kumbh Infrastructure Investment Trusts (InvIT).
strategic investments in Hathway Cable
JioPhone offered a suite of benefits like real This demerger deleverages the balance
and Datacom Limited and DEN Networks
time travel information, ticket bookings, sheet and establishes Jio franchise as an
Limited. These investments will create a
asset-light, digital services company.

96 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

FINANCIAL, OPERATING AND Jio continues to transform Indian Telecom OUTLOOK

CUSTOMER ENGAGEMENT METRICS industry with its leading performance Jio will continue to invest and build world
Jio continued its momentum from the benchmarks as follows: class digital infrastructure for the citizens
previous year to FY 2018-19, reporting of the country, making a meaningful
• Industry leading ARPU of `126.2 per
robust revenue growth and margin socio-economic impact and generating
month during the quarter ended March
performance. This was driven by strong shareholder returns over the next several
2019
adoption of Jio services, reflected in strong decades. This will be built on the tenets of
• Average voice consumption at 823
subscriber addition and usage metrics on providing data network with best coverage
minutes per user per month (highest per
data and voice. Subscriber addition of 120 and network quality at the most affordable
subscriber usage in the industry) during
million in FY 2018-19 was well ahead of prices. In addition to connectivity solutions
the quarter ended March 2019
the 83 million added in FY 2017-18. Gross and already established media and
• Average data consumption of 10.9 GB
revenue of `46,506 crore for FY 2018-19 on entertainment services, Jio strives to create
per user per month (amongst highest
a subscriber base of 306.7 million and EBIT a comprehensive digital ecosystem, with
per subscriber usage globally) during the
margin of 18.9% marked the continuation focus on scaling up its new offerings across
quarter ended March 2019
of profitable growth. commerce, education, healthcare, financial
• Total wireless data consumption of 956
services and agriculture.
FINANCIAL PERFORMANCE crore GBs during the quarter ended
March 2019 (one of the world’s largest Working on its commitment to Wireline
FY 2018-19 FY 2017-18
Financial and fastest growing mobile data services, Jio has built the product and
Parameter ` in US$ ` in network) services to transform every home to
crore in million crore • Video consumption drove most of the SMART Home by serving the digital needs
usage, increasing to over 500 crore hours of tomorrow’s India today – including
Gross
46,506 6724.9 23,916 per month ultra-high speed internet, content, Home
Revenue
EBIT 8,784 1270.2 3,174
voice services and Home IoT services,
EBIT (%) 18.9% 13.3%
among a list of digital services. Jio will
continue to work relentlessly to provide
widespread fiber connectivity to Modern
India.

TARGETING DIFFERENT CUSTOMER GROUPS WITH TAILOR MADE SERVICES

Mobile Customer Home Broadband Enterprise customer

Connectivity Smart Home Cloud Application
Payments Voice activated commerce Data Analytics
Media UHD entertainment Machine Learning
Health VR Gaming (overlay with traditional voice + data
Education Video Conferencing services, Machine to Machine (M2M)
Commerce (combination of ubiquitous IoT (overlay with Quad play Offering) interfacing, M2M connectivity)
connectivity and physical retail)

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 97

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Digital Services

RELIANCE JIO-AN INTEGRATED DIGITAL SERVICE COMPANY

Growth
Engines

Network JioPhone FTTH Enterprise Digital Technology

4G LTE > 2G coverage Large addressable market Priming market for Untapped market Large addressable market
growth opportunity
On track for 99% 450 million feature Bouquet of media/OTT
population coverage phones in India Minimal wireline Enterprise connectivity content for customers
More extensive fiber Affordable tariff plans for broadband penetration and suite of new Exclusive partnership to
network new data users provides huge offerings enhance the platform
Pan India 4G- LTE opportunity Affordable services for Opportunities across
across 800/1800/2300 Fiber backbone in place SME segment commerce, financial
MHZ bands services, education,
healthcare and agriculture

QQ ILLUSTRATION: CORPORATE SOCIAL RESPONSIBILITY

•
Jio Apps and Smart education Better farm productivity Superior healthcare
Smart education for Girl Child Increasing farm output Bringing superior healthcare to people

Situation
Jio has been a key catalyst for the digital revolution in India, building numerous cases of
social, economic and sustainability benefits across the country.

Action Taken Action Taken Action Taken

Jio Gyan Shala was inaugurated at Providing farmers with easy availability As a test case, the first ever tele-robotic
Maharani Laxmi Bai Government Girls of expert advice on fertilisers, pest operation was conducted in the state of
Higher Secondary School in Satna, management and animal husbandry Gujarat (using Jio’s fiber connectivity over
Madhya Pradesh through JioChat 32kms)

Scale of Impact Scale of Impact Scale of Impact

Smart classes to help over 2,000 girl Farmers across multiple states Performing intervention by operating
students robotically controlled instrument

Outcome Outcome Outcome

Bringing high quality education to the Boosting agriculture output during both Building new cases for long distance
girls in villages Rabi and Kharif seasons, improving treatment and surgery for overcoming
milk productivity in livestock thereby healthcare infrastructure challenges in
increasing annual earnings of farmers the country

98 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

QQ ILLUSTRATION: JIOPHONE
•
Affordable devices and digital education Improved business results
Improving digital education Multiple business cases emerging among small business
owners (and MSMEs)

Situation
JioPhone was launched with the objective of empowering every Indian with the power of digital services, especially first-time
mobile data users who could not afford a smartphone. Its adoption and popularity have empowered many and changed countless
lives for the better.

Action Action
JioPhone delivers online learning content used for primary / With the affordable device and solutions, multiple use cases
middle school students in rural India where there is sub-optimal have emerged with businesses using video chat to track their
education infrastructure field sales force, training manpower, tourist operators facilitating
connectivity in remote areas and fishermen using it for tracking
weather patterns and relaying information

Scale of Impact Scale of Impact

Rural population and first-time mobile internet users in villages All small business owners across sectors ranging from small
machinery and parts manufacturing, sales and services
organisations, tourism and fishery

Outcome Outcome
Significant opportunity for improving rural education content Leverage affordable technology to improve business results,
using digital platforms, ready access to updated educational create efficiency, improve customer experience and navigate
content, increasing awareness among children and adults hazardous situations

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 99

MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance

Media and Entertainment

Rahul Sudhanshu Jyothi Ramesh

Joshi Vats Despande Damani

Network18 continues to grow in

stature and significance, with an
aim to deepen engagement through
extending our powerful brands in
news and entertainment across
mediums, distribution platforms and
business models. With India’s vibrant
media sector as its playground, and
an unbridled aim to reach out and
intermesh with the lives of Indians
across demographics and languages,
Network18 maintains its position at
the cutting edge, touching the lives
of 1 in every 2 Indian. Network18’s
forays into subscription models
through its flagship digital properties
are aimed at embracing change and
accelerating growth as it continues to
invest towards becoming an industry
leader.

Inform, enlighten and entertain

100 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

STRATEGIC ADVANTAGES AND COMPETITIVE STRENGTH

Network18 is RIL’s flagship investment position amongst News networks in and a leading OTT platform.
into the media and entertainment sector. India. Its 20 domestic channels span 15 • Network18’s digital content properties
It is one of the most diversified media languages, providing a solid leadership across news and entertainment are now
conglomerates in the country, with in reach. With a 10.6% share of news used by over 130 million people; and one
footprints across television broadcasting, viewership in FY19, TV18 maintains its in every four internet users in India is on
movie production and distribution, digital leadership even versus to legacy brands Network18 websites or apps.
content and commerce, print magazines, and free-to-air networks.
Network18’s operating model puts the
mobile content and allied media services. • Subsidiary Viacom18 is the youngest and
audience at the centre, and is driven
fastest growing premium entertainment
• Network18’s television channels by its zeal to provide consumers with
network in India. It is the #3 pan-India
reach out to 800+ million people in best-in-class media and entertainment
entertainment broadcaster (ex-sports),
India, representing 95%+ of the TV products and content that establish new
with an 11.1% viewership share in FY19.
viewing universe. This makes more benchmarks in creative excellence, fair
Apart from TV broadcasting, its full
than 1 in every 2 Indian, a consumer of journalism and audience engagement.
portfolio-offering includes a film studio
Network18's broadcast content.
renowned for clutter-breaking cinema
• Subsidiary TV18 has cemented its #1

OPERATING PILLARS

NETWORK
CHANNEL- REACH FOR THOUGHT
SYNERGY
AGNOSTIC IMPACT LEADERSHIP
APPROACH
 etwork18 strives to be
N Network18 is future-ready Network18 is steered Network18 comprises leading
channel-agnostic to ensure its with its relentless focus on by a professional and television channels, digital
content reaches seamlessly the identified axes of growth: experienced team that helps and mobile properties and
to consumers through their regional content and digital it to consistently strive to host publications in all key media
platform of choice. This delivery. This two-pronged thought leadership on-air, genres. This facilitates
approach is increasingly approach enables the online and on-ground. It is cross-promotion and cross-
relevant considering the advent Company to reach its audiences driving leadership not only pollination of content and
of digital entertainment and regardless of geography, through consumption numbers, expertise across its network,
the splintering of platforms. language or demography. but also by facilitating the enabling enhanced advertising
development of new ideas and and subscription revenue
emerging thought processes. generation.

STRATEGIC BRAND
COLLABORATIONS EXCELLENCE OPERATING MODEL

Network18 has a track record At Network18, the focus is on Brand Business Model
of building successful strategic driving the highest standards of
alliances with international creative excellence by fostering
media companies such as a culture of innovation to build Audience
Viacom in entertainment, new content formats across
CNN in English general news platforms, thereby creating
and CNBC in business news, strong brands across diverse Content Medium
A+E Networks in factual media.
entertainment and Forbes in
the business magazine genre.

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 101
MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Media and Entertainment

Value-chain: Network18 dovetails with the Jio ecosystem across content creation and distribution, thereby delivering the best of Indian
and global content and brands to discerning audiences across India’s vast demographic diversity.

VALUE CHAIN

Producer

Content Creation and Curation

(IP ownership with broadcaster)

Digital–Own Platform(B2C)

Subscription Advertising
Audience TV–Cable/DTH/FTTx (B2B2C) Advertiser
Income Revenue

Digital–Telco Platform (B2B)

Content Syndication
(Inbound and Outbound)

Partner

Network18 and its affiliates across the of wider variety of content, especially in the dominant medium while Digital is the
media, telecom and broadband value- Indic languages. fastest growing (after the nascent segment
chain are stitching together a compelling of online gaming), and is likely to overtake
Within the media and entertainment sector,
value-proposition for its viewers in a Films this year and Print by 2021.
the subs-sectors that Network18 primarily
pipe-agnostic manner. Synergies in content (Source: EY-FICCI FRAMES 2019 report)
plays in are well-placed; TV continues to be
creation and efficiency in distribution serve
to amplify the reach of Network18’s brands,
delivering impactful ideas and immersive MEDIA AND ENTERTAINMENT SECTOR SEGMENTS
imagery in class-leading packaging.
0 500 1,000 1,500 2,000 2,500

MARKET ENVIRONMENT 660 303 156 119 238 Rs bn

India’s media and entertainment sector 2017 1,476

grew at a robust pace in CY 2018 (13.4%
y-o-y) to reach a size of `1.67 trillion, 740 306 175 169 285
driven by a strong recovery following 2018 1,674
the temporary ad-revenue hiccups post 815 317 194 223 338
implementation of GST in the previous year. 2019E 1,887
The industry is slated to grow at 12% CAGR
over CY 2018-21, reaching a size of `2.35 955 338 236 354 467
trillion in CY 2021. This growth is likely to be 2021E 2,349
driven by tailwinds of better connectivity,
higher disposable incomes and availability TV Print Films Digital Others Total

(Source: EY-FICCI Frames 2019 report)

102 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

GROWTH DRIVERS 4. Telco partnerships for Digital media: While paid digital video viewers grew from
7million in 2017 to 12-15 million in 2018 (driving Digital subscription up 262% to `14
Consumption drivers:
billion), the percentage of paying subscribers to total consumers is still less than 5%. In
1. Socio-economic tailwinds: With more
contrast, over 200 million people accessed digital content through telco data bundles.
households having television sets,
As a result, ~60% of video viewership volumes were generated by telcos.
better rural electrification allowing
(Source: EY-FICCI FRAMES 2019 report)
for more consumption, and improved
awareness and propensity to watch, TV 5. Rise of vernacular consumption: India is a linguistically diverse market, and people
viewership in India continues to rise. As wish to consume content in their own language to a very large degree. Hence, content
measured by BARC, TV penetration in producers (both Indian and Global, across broadcast and digital) have increasingly
India currently stands at 66% and overall created vernacular offerings, which have found instant traction. A substantial chunk of
viewership is still rising, despite the viewership growth on TV is presently being led by regional languages as a result.
advent of the Digital medium.
2. Advent of digital medium: India is still VIEWERSHIP GROWTH WAS LED BY REGIONAL LANGUAGES (%)
substantially a single-screen market Oriya 34
(only 4 million out of 198 million homes
Assamese 26
have multiple TVs), and hence co-
viewership at home is the norm. The Marathi 25
availability of cheap data and handsets Bhojpuri 22
has spurred a mobile revolution in Urdu 20
India, which has opened up a wide pipe English 15
that is used the maximum for content
Hindi 15
viewership. As mobile (and especially
smartphone) penetration has risen, Gujarati 15
the convenience and personalisation Tamil 14
of viewing content digitally has caught Kannada 14
on, which has created a parallel channel Bengali 10
for video consumption vis-a-vis TV. As a
result, Indians spent 30% of their phone
Telugu 9
time on media and entertainment apps All India/2+/Channel Lang/Wk 38-50/2017 and 2018
(EY-FICCI FRAMES 2019 report) (Source: BARC)

6. Segmentation of content offerings: As the number of channels has risen and the
MOBILE SUBSCRIBER GROWTH digital medium has grown in significance and scale, more segmented content which can
(million) cater to different sensibilities and age groups is being created. While escapism GEC and
Movies still command the lion’s share of viewership, other genres are attaining critical
668
Urban mass.
646
499
Rural
526 3% 1%
2017 2018 6%
Source: TRAI 6%
3. OTT revolution underway: Led by 53%
7%
the promise of direct-to-consumer
monetisation, OTT apps have
proliferated, with Global and Indian
content players (broadcasters and
24%
producers) as well as distribution
platforms launching their (mostly video)
offerings. 325 million people viewed
videos online in 2018, a growth of
25% from 2017 (EY-FICCI FRAMES 2109 GEC  Movies  News  Kids  Music  Sports  Others
report). All India/2+/Wk 37-49/2018

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 103
MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Media and Entertainment

Monetisation drivers: even traditional advertisers to allocate and indirect subsidiaries of Network18
1. Digitisation of cable: The digitisation ad-budgets to digital too. This is driving and TV18 with the respective parent was
of cable has enabled improved sharp growth in digital advertising approved by the National Company Law
subscription revenue, as it has on local media platforms, despite Tribunal (Mumbai bench). The scheme
reduced rampant under-reporting of global behemoths like Google (esp. became effective from 1st November 2018,
subscribers as well as improved billing YouTube) and Facebook cornering a the appointed date being 1st April 2016.
and identification of customers. India’s disproportionate chunk presently.
NEW TARIFF REGIME
ARPU (average revenue per user) has
New tariff order (NTO) implementation is
continued to rise as a result, and the FINANCIAL AND OPERATIONAL
medium-term positive, but has resulted
broadcaster share has risen to 25%. PERFORMANCE
in viewership being impacted for all
FINANCIAL OVERVIEW
ARPU (Rs/month) broadcasters as process of consumers
Network18 continued on its growth
choosing channels/packs and distribution
Markets 2017 2018 trajectory, and invested in key areas to fill
realignments is still underway. This also
DAS-I 250-350 250-350 whitespaces and ring-fence its position.
resulted in volatile viewership data, and
DAS-II 200-325 200-325 While the first three quarter of FY 2018-19
advertisers pulling back spends in Q4
DAS-III 150-225 175-225 were buoyed by the revival in ad-spends
FY 2018-19, dragging full year growth.
DAS-IV 125-200 125-225 and rising traction with viewers across
Subscriber base has yet to normalize due to
the board, the last quarter dragged due to
(Source: EY-FICCI FRAMES 2019 report) implementation challenges. The channels
the new tariff regime for TV channels, and
(through ‘Colors wala pack’ as well as
2. New TRAI tariff regime: The new tariff impact of absence of movie ‘Padmaavat’,
distributor packs) have witnessed strong
regime ushered in by the regulator Union budget and some Cricket/Live
uptake in this transition phase; led by
allows for unbundling of bouquets to events this year. On a comparable basis,
breadth of content at a value price-point,
enable customer choice, and betters FY 2018-19 ex-film revenue rose 7%
and improved distribution tie-ups.
transparency across the broadcast y-o-y on regional growth and a reviving
value chain. This process shall allow ad-environment. FY 2018-19 operating We believe that in the new regime, pay
strong content propositions to thrive, EBITDA was up 13% y-o-y despite `131 channels will have better consumer
and optimize the financials of a channel crore additional investments into regional connect as well as distribution economics
based on its demand and the propensity channels and digital expansions (VOOT in the medium term. Our Free-to-Air (FTA)
to garner advertising and subscription International & Kids and CricketNext). This channels Rishtey (General Entertainment)
revenue. While it shall lead to some flux was led by regional news gestation losses and Rishtey Cineplex (Hindi Movies)
in the short-run, the regulation shall compressing 42% y-o-y, and Business-as- were withdrawn from DD Freedish, and
turn the broadcaster model from B2B to usual Entertainment EBITDA margins rising relaunched as pay channels with strong
B2C, which is a positive for monetisation to 9% (vs 5% in FY 2017-18). EBIT however content propositions.
as the broadcaster share of on-ground was impacted by fair valuation of financial
 V18 News still retained its leadership even
T
collections shall rise substantially. The assets.
versus FTA peers despite being a pay-
new regime shall also reduce carriage/
Reported network, though the cluster’s viewership
placement expenses substantially,
FY FY share fell to 9.3% post NTO implementation
which has been a major pain-point for %
2018-19 2017-18 Change (11.5% pre-NTO).
(especially new) broadcasters.
` in US$ ` in y-o-y
 ost NTO and shift from Freedish, the
P
3. Adoption of Digital Advertising: As the crore in million crore
viewership share of top 4 entertainment
advent of digital content consumption
Revenue 5,116 739.8 1,839 178%# broadcasters (ex-sports) all fell by 2 to
(especially video) continues, more
4% each. Our Entertainment cluster’s
advertisers are increasingly attracted EBIT (52) (7.5) (25)
viewership share was 8.6% (11.7%
to digital advertising. As volumes of EBIT
Margin (%)
(1.0%) (1.3%) pre-NTO), maintaining its #3 position.
digital content have risen very sharply,
advertising rates on digital have been #
+2% on a comparable basis THE YEAR OF VERNACULAR
under pressure; but the influx of new The year was defined by regional content
CORPORATE RESTRUCTURING
advertisers onto the medium and the consumption as well as monetisation
There have been realignments in corporate
promise of impact-measurability is witnessing accelerated growth across all
structure for group simplification, which
making digital advertising an integral parts of the media industry that Network18
have provided operational synergies.
part of media plans. The aim of reaching plays in, whether broadcasting or digital;
out to varied audiences coupled with The scheme of arrangement for the merger and straddling news, entertainment and
the possibility of targeting has driven by absorption of wholly-owned direct film.

104 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

QQ OPERATIONAL OVERVIEW

1 TELEVISION BUSINESS

NEWS Business News constitutes CNBC TV18 and CNBC Awaaz, No. 1 in English and Hindi business news genre, respectively,
and CNBC Bajar, India’s first Gujarati business news channel.
Highlights of the year: Amidst choppy markets, the business news channels continued their dominant leadership in their
respective genres.
General News includes CNN-News18 and News18 India.
Highlights of the year: News18 India became the #2 General Hindi News channel. The channel also touched #1 position
in primetime in a highly competitive genre.
Regional News includes 13 News18 channels (including erstwhile ETV channels) and News18 Lokmat.
Highlights of the year: The market share of News18 regional channels has grown from 2.5% in late 2016 to 6% (pre-NTO).

ENTERTAINMENT
Hindi General Entertainment includes flagship general entertainment channel (GEC) Colors, GEC Rishtey, and Hindi movie
channel Rishtey Cineplex.
Highlights of the year: For the entire FY 2018-19, Colors was the #2 player in the pay Hindi GE category and a clear category
leader in all day prime time. Despite a much smaller library, Rishtey Cineplex as an FTA channel continued to climb, taking
the #1 spot in a cluttered genre of Hindi movie channels, led by smart curation and distribution.
Youth and Music includes MTV India, the No. 1 youth brand, and 24x7 Bollywood music channel MTV Beats
Highlights of the year: MTV Beats remained the fastest growing music channel in the country.
English Entertainment has VH1, Comedy Central (India’s first 24-hour English comedy channel) and Colors Infinity.
Highlights of the year: While Comedy Central is the top-ranked English Entertainment Channel, the English cluster comprising of
Comedy Central, Colors Infinity and VH1 combined to control nearly 60% share of the English Entertainment space
Kids Entertainment constitutes of Nickelodeon, Sonic, Nick Jr. /Teen Nick and Nick HD+.
Highlights of the year: Nickelodeon has been the No.1 channel in the kid’s category since August 2014 and continues to
lead the segment.
Regional Entertainment The regional entertainment bouquet comprises of Colors Kannada and Colors Super (Kannada),
Colors Bangla, Colors Oriya, Colors Gujarati and the latest entrant Colors Tamil.
Highlights of the year: The regional portfolio was extended into movies to further provide segmented offerings to a
growing consumer-base, with the launch of Colors Kannada Cinema.
Infotainment has factual entertainment channel History TV18 and lifestyle channel FYI TV18.
Highlights of the year: FYI TV18 has grown from strength to strength to cement its position as the No.1 Lifestyle channel.
2 FILM BUSINESS
Film business includes Viacom18 Studios and Jio Studios.
Highlights of the year: Andhadhun, became the highest rated 2018 Indian Film on IMDb. Manto, one of our finest movies
was India's official entry in the 'Un Certain Regard' Category at Cannes. Viacom18 Studios successfully forayed into Telugu
cinema with 'Devadas' and into Malayalam cinema with “Kodathi Samaksham Balan Vakeel”.
3 DIGITAL BUSINESS
Digital Content includes Moneycontrol.com (leader in the finance category), VOOT (#2 broadcaster–OTT in the country) and
News18.com (digital destination for all general news), as well as fledgling properties IN.com (celeb news) and CricketNext.
Highlights of the year: Broadcast OTT VOOT has amassed over 130 mn gross downloads, and boasts of the highest
watchtime in broadcast-OTTs at 45mn+.
Digital Commerce includes Bookmyshow
Highlights of the year: BookMyShow entered into Live event production with world’s largest live entertainment company Cirque
Du Soleil with their production show “Bazzar”. The show which was held for the first time in India in Nov-Dec18 at Mumbai and
Delhi got an overwhelming response.
4 PRINT/PUBLICATION BUSINESS
Publication business Publication business has a portfolio of highly reputed magazines comprising Forbes India, Overdrive,
Better Photography and Better Interiors.

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 105
MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Business Performance Media and Entertainment

• Growing ad-spends in regional channels extend MoneyControl MoneyControl took RISKS

(news, led by regional elections; initial steps to venture into subscription TRAI’s new tariff order shall benefit
and entertainment, driven by rising model (ad-free and premium features) and broadcasters in the long-run as carriage/
consumption and value-perception) was transactions (mutual fund distribution). placement costs gets rationalized, the
a consistent theme for the TV channel business becomes more B2C than B2B, and
Cricket portal CricketNext (#3 portal in
portfolio as well as Digital properties like transparency improves broadcasters share
India) was relaunched with a dedicated
News18.com and VOOT. of consumer ARPU. However, the changed
app. Over the next few months, CricketNext
business model on subscription and flux in
• Viewership share of our regional news intends to build on this momentum with its
advertising mechanics is likely to impact
cluster increased further to 6% of all coverage of the IPL and World Cup.
business in the short run.
news viewed in India, vs 2.5% two years
News 18 Languages portfolio has
ago. Improved ad-traction and active Fragmentation of viewership: With the
steadily grown its spread across
cost control pruned gestation losses of advent of Digital and a launch of multiple
regional languages, with content in Hindi,
our 8 regional news channels launched new platforms led by cheaper bandwidth,
Marathi, Bangla, Gujarati, Kannada, Tamil,
over FY 2015-17. viewership has expanded significantly,
Malayalam, Telugu, Punjabi and Urdu
thereby fragmenting the consumer base
• Regional entertainment channels (Malayalam was launched in May 2018 and
across platforms. This higher churn rates and
continued their viewership and Telugu went live in August 2018). Unique
lower stickiness provides an opportunity
monetisation improvements across most Users on languages grew 118 per cent
to wean away viewers from traditional
of our geographies, clocking in excess of (December 18), with more than 96 per
dominant players in television, but also is a
30% growth y-o-y on aggregate. cent of our users coming through mobile
challenge as monetisation models are still
phones.
• Viacom18 Studios sharpened its focus evolving.
into regional cinema, through films Entertainment portal IN.com was
Digital monetisation is lagging investments,
like Thackeray (bilingual in Hindi and relaunched in August 18. It will be India’s
especially amidst strong competition.
Marathi), Ani…Dr Kashinath Ghanekar premiere destination with opinionated
(Marathi) and Devadas (foray into content around celebrities. Largely aimed Content costs: Spike in demand for content
Telugu). at millennials, the language and content creation/curation is driving up content costs
promises to be fresh and young. across Digital, Movies and GEC.
GROWTH AND INNOVATION
Regional movie channel Colors Kannada Consolidation (both horizontal and vertical)
Network18 has been striving to improve its
movies was launched in Q2 FY 2018- continues to exert influence on the market.
portfolio as well as enhance its outreach,
19, to complement our leading GECs There have been multiple cases of M&A
so as to realise economies of scale and
in Karnataka. It solidifies our existing across the broadcast and digital value chain,
attain leadership. Substantial investments
leadership, and is #2 with 15% share in examples of which include Star’s acquisition
continue to be made to create a compelling
Kannada movie genre. by Disney, DishTV acquiring Videocon D2H,
proposition for viewers.
and Reliance Industries taking controlling
VOOT’s product proposition has been
Free-to-Air (FTA) channels, Rishtey stakes in Den and Hathway.
bolstered through making news channel
and Cineplex, were taken to the pay
content available on it too. Additionally, the
ecosystem and rebranded as Colors OUTLOOK
platform is making rapid strides towards a
Rishtey and Colors Cineplex respectively, Network18’s growth aspirations stem from
pay model too, with the first international
establishing the channels as premium an inherently high-quality portfolio of
launch in UK through a partnership with
urban entertainment destinations. The properties, a relentless drive for garnering
Virgin mobile. VOOT Kids, a differentiated,
Colors Cineplex library is being beefed market-share, and a concerted effort to
niche pay offering went into Beta
up, to function as a full-fledged pay movie utilise synergies and push efficiencies across
channel. In the case of Colors Rishtey, it Viacom18 studios announced its digital its owned and affiliate media (traditional
is likely to allow for an overall increase in content arm–Tipping Point in May 2018. and digital) and telecom portfolio. The
monetization in the long-run, and slots-in The intention was to create short-form Company believes that India’s media
better with industry dynamics in the new content for Digital (especially for VOOT) by and entertainment sector is poised for
tariff regime. utilizing the strengths of the movie studio; substantial growth, as the segment steadily
thereby creating high-value content in- gains international stature in terms of both
Investments were made to revamp and
house, amidst the current high-competition advertising and consumer spends.
war for content.

106 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

BUSINESS STEWARDSHIP QQ ILLUSTRATION

At Network18, Corporate Social
Responsibility (CSR) is embedded in the
Company’s long-term business strategy.
Innovation in interactive content
The Company’s community initiatives
help elevate the quality of life of millions,
Action Taken
especially the disadvantaged sections
of the society. Network18 seeks to ‘Voting on Voot’ Launching Launching Launched Play Launched as
transform people’s lives by promoting was launched ‘Video Vichaar’ an ‘Ask me Along with Ke a pre-budget
health, education and sports. across genres on Bigg Boss Anything’ Hobe Banglar interactivity
and languages– S12 fans an interactivity Kotipoti to
Some socially relevant programs
Bigg Boss S12, opportunity format to allow allow users be
undertaken during the year are -
Sur Nava Dhyas to share their users vote on part of game
• A s a responsible broadcaster, Nava, Bigg Boss opinions question they show through
Nickelodeon has an annual pro socio Kannada S06 via video want to ask in innovative
campaign, Together for Good, which submission reality shows weekly games
aims at making kids responsible and
positive agents of change in society.
• In an industry first, Viacom18 has Scale of Impact
partnered with the world's largest
350 Mn+ Votes 60K+ video Over 2 million Participation Union Budget
philanthropic organisation, Bill
cast on submissions votes on from 1.50 Poll saw 300K
and Melinda Gates Foundation,
the platform on Bigg Boss national million users interactions
and development communications
television
specialists, BBC Media Action to
create a general entertainment fiction
series with an underlying behaviour
Outcome
change message on sanitation.
• CNN-News18 did the chilling expose •  oot empowering today’s digital audience through interactivity
V
#ChildSexHighway which uncovered • 2nd screen engagement across 11 formats and 30 shows
the disturbing secret of child sex trade • Fans involved In the conversation of the show
along national highways. • Facilitated users to analyse budget impact on products
• Swasth Immunised India–Network18
and Serum Institute of India joined
hands to help immunise the kids JIO STUDIOS Eros and JioSaavn to maximize the creative
of India. The aim of this campaign Jio Studios, RIL’s media arm, has been set bandwidth within the group.
is to spread awareness about up with the vision to build a 360 degree
Jio Studios intends to work with all the
immunisation in India. content ecosystem of films, web series,
top talent across Hindi and regional
• Road Safety Initiative – The road to music and other content in Hindi and
entertainment industry including producers,
safety campaign created by Network regional languages. “Stree” and “Luka
directors, writers and actors as well as
18 in partnership with DIAGEO created Chuppi”, the first two Hindi film releases
music artistes and composers to bring
awareness and inspired change for under the Jio Studios banner enjoyed
interesting stories to the market in multiple
millions of people in India. Backed by tremendous box office success and there
languages whether in the form of film, web
ministers, bureaucrats and celebrities are several projects under development.
series or original music videos. Being a
across 20+ states in the country, the With a rapidly growing 306.7 million Jio
technology company, the focus is on weaving
campaign reached more than 130+ user base on mobility and the imminent
innovative elements into content to promote
million people. State wise road safety launch of the fiber-to-the-home services,
interactivity and increase engagement
issues were deliberated to ensure Jio Studios is tasked with aggregating
between users and content.
impactful steps are being taken to the best in class content for JioTV and
reduce the number of accidents. JioCinema as well as producing quality The mantra at Jio Studios is to become
content to create a differentiated a one-stop-shop for every Indian’s
compelling consumer offering across all Jio entertainment needs by bringing them
platforms. Jio Studios will also look to build interesting stories that can be enjoyed across
synergies with other media investments of any device inside or outside the home.
Reliance such as Viacom18, Balaji Telefilms,

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 107
MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Liquidity and Capital Resources

Srikanth Soumyo
Venkatachari Dutta

FINANCING STRATEGY ii) US$1.5 billion equivalent syndicated

Managing Liquidity and Capital Reliance has over the last few years term loan facilities – These facilities were
resources for Reliance and all its successfully executed the largest tied-up in USD and JPY. The facilities
group companies is a key focus investment cycle in its corporate history. were tied up in March with availability
area within Treasury. The financial Over the last couple of years, Reliance periods between 6 to 9 months and
markets witnessed heightened has rolled out its digital services business average life of 5.25 and 5.5 years from
uncertainty and volatility on ‘Reliance Jio’ across India weighted average drawdown date.
the back of geopolitical and
Through prudent financial discipline, REFINANCING
trade tensions as well as some
Reliance has maintained a judicious mix of As part of its liability management exercise,
significant changes in the banking
funding sources across instrument classes, during FY 2018-19, Reliance successfully
regulatory environment in India.
financing products, financial markets and refinanced long-term financing of US$2.7
Reliance Treasury focused on
investor classes. billion syndicated term loan facilities.
providing liquidity at the optimal
Reliance lengthened the maturity of its
risk adjusted cost by using a Reliance maintains strong relationships
long-term debt portfolio through this
variety of markets, instruments with more than 100 banks and financial
refinancing exercise. This was the most
and currencies. By maintaining its institutions. It has also built relationships
widely syndicated loan by Reliance till date
investment portfolio in low risk with 14 Export Credit Agencies (ECA)
with participation from 44 banks and a total
liquid investments, it was able globally – the highest number for any
amount of US$1 billion syndicated.
to navigate the dislocation in the corporate in the world. This, along with its
financial markets in the second exceptional credit profile and high quality This syndicated loan was awarded the
half of the year. In partnership with credit rating, strengthens its ability to raise ‘Best Syndicated Loan’ by The Asset, Asia’s
banks it continued to innovate by long-term resources from global financial leading financial publication for issuers and
deploying new technologies like markets at very competitive rates. investors.
API and investing in Blockchain.
Reliance has capitalised on opportunities RIL also issued non-convertible debentures
Reliance continues to enjoy
to optimise cost of borrowing and align aggregating to `19,000 crore in the Indian
a strong credit rating and is
maturity profile of existing debt portfolio capital markets.
currently rated two notches above
with business strategy
sovereign by S&P and at par with FINANCING IN SUBSIDIARIES
sovereign by Moody’s. During FY 2018-19, Reliance tied-up new During FY 2018-19, Reliance Jio Infocomm
financing as well as refinanced its existing Limited (RJIL) successfully tied up JPY
loans as part of its on-going liability 53.5 bilillion, the largest Samurai loan for
management exercise. an Asian corporate and also for a telecom
company. The loan was successfully
NEW FINANCING
syndicated to 9 local Japanese banks
During FY 2018-19, Reliance tied-up:
aggregating to JPY 19.5 billion, thereby
i) US$340 million and EUR 136 million taking the total number of participating
SACE backed facility – This is the first banks to 12. Additionally, RJIL also
transaction globally under the SACE tied-up term loan facilities aggregating to
Push Facility where SACE support is US$1.5 billion.
“untied” and based on potential future
In June 2018, RJIL tied up US$825 million
engagement with Italian vendors.
and EUR 150 million Korea Trade Insurance
The deal was structured with four
Corporation (K-Sure) supported ECA
different tranches at differential levels of
financing with door to door tenor of over
SACE cover and bank pricing.

108 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

ten years. This transaction was the largest Reliance believes that the Group has classes ensures the most optimum risk-
financing transaction globally in the sufficient working capital resource for returns combination for the portfolio.
telecom sector supported by K-Sure. foreseeable requirements. It continuously The investment portfolio is monitored
monitors and optimises its working capital and operated under a prudent risk
The K-Sure deal has been awarded ‘Best
requirements by leveraging diverse trade management framework.
ECA-backed Telecoms Finance Deals of the
financing solutions covering receivable and
Year’ by Trade and Export Finance (TXF) The risk management and investment
payable cycles and executing innovative
as part of their perfect 10 awards, which process is regularly reviewed to refine
structured trade products.
recognise only 10 deals globally within the processes and incorporate evolving
Export and Project finance for 2018. Reliance has a well diversified investments best practices
portfolio, which assures liquidity and
CAPITAL RESOURCES steady returns across different market
During FY 2018-19, Reliance and its environments. An efficient allocation
subsidiaries tied up facilities across various of the portfolio across various asset
financing products and maturities. The
table below shows debt levels for the year CREDIT RATING
ended March 2019 and March 2018 for Reliance’s financial discipline and prudence is reflected in the strong credit ratings
Reliance on a consolidated basis. ascribed by rating agencies. The table below depicts the credit rating profile:

(` in crore)
March 31, March 31, Rating
Particulars Instrument Rating Outlook Remarks
2019 2018 Agency
Cash and Marketable International Debt S&P BBB+ Stable Two notches above India’s
1,33,027 78,063 sovereign Rating
Securities
International Debt Moody’s Baa2 Stable At par with India’s sovereign Rating
Gross Debt 2,87,505 2,18,763 Long-Term Debt CRISIL CRISIL AAA Stable Highest rating awarded by CRISIL
Long-Term Debt India Rating Ind AAA Stable Highest rating awarded by
Net Debt 1,54,478 1,40,700
India Rating

LIQUIDITY AND TREASURY RATINGS DEFINITIONS

MANAGEMENT S&P BBB+: An obligation rated BBB exhibits adequate protection parameters. However,
Reliance has a strong focus on liquidity and adverse economic conditions or changing circumstances are more likely to lead to a
maintains a robust cash position to ensure weakened capacity of the obligor to meet its financial commitment on the obligation.
the Group has adequate cover to respond
Moody’s Baa2: Obligations rated Baa are judged to be medium-grade and subject to
to potential short term market dislocation.
moderate credit risk and as such may possess certain speculative characteristics.
Reliance’s liquidity and borrowing plans
CRISIL AAA: Instruments with this rating are considered to have the highest degree of
are established within the context of its
safety regarding timely servicing of financial obligations. Such instruments carry the lowest
annual financial and strategic planning
credit risk.
processes. Cash generated through
operating activities remains the primary Ind AAA: Instruments with this rating are considered to have the highest degree of safety
source for liquidity along with undrawn regarding timely servicing of financial obligations. Such instruments carry the lowest credit risk.
borrowing facilities and levels of cash and
cash equivalents.

Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 109
MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Sustainable Growth at Reliance

Reliance has been at the forefront of integrating sustainability The four enablers are:
into its core business, pioneering change at the technological, A. Strategic Framework
behavioural as well as the policy levels. In its business strategy, B. Integrated Approach
the Company has gone much beyond risk management to C. Risk and Governance
inculcate a future growth oriented management philosophy D. Digital Platform
which draws from four key enablers that reinforce the
Company’s fundamental philosophy – ‘Growth is Life’.

adopted the six capitals postulated by

A. STRATEGIC FRAMEWORK AT C. RISK AND GOVERNANCE
the International Integrated Reporting
RELIANCE Risk management at Reliance is
Council’s (IIRC) Integrated Reporting
A prudent financial framework, a reviewed based on the ever-changing
<IR> framework to aptly delineate its
robust risk management framework external and internal environment
value creation story:
and the Company’s short and long to ensure decision-making is aligned
term objectives linked to value creation • Natural Capital and Climate with the organisation’s business
define Reliance’s Strategic Framework. Change strategy, improving the resilience
It also outlines the expectations and • Human Capital and People of the organisation, which creates
boundaries within which each of the Connect sustainable value. The Company
Company’s businesses must operate. • Manufactured Capital and recognises that effective risk
The intent is to also provide guidance Product Stewardship management is fundamental to its
to the established as well as evolving • Intellectual Capital and Innovation continued profitability and long-term
businesses in the Group by setting • Financial Capital and Credit Rating sustainability. The infrastructure for risk
effective business objectives for each. • Social and Relationship Capital and governance activities at Reliance
The entire framework is underpinned comprise of the Enterprise Risk
A strong balance sheet is the outcome
by the core belief that value creation Management (ERM) framework. The
of a robust financial framework.
and preservation are paramount. ERM framework identifies, evaluates,
By capitalising on additional
This cuts across the entire set of manages and reports risks arising
opportunities such as efficient use of
internal and external stakeholders and from the Company’s operations. ERM
natural resources which leads to cost
leverages a strong knowledge and asset enables Reliance to manage its risks
reduction and maintaining strong
base as well as investment in strategic within acceptable limits by using risk
relations with stakeholders, Reliance is
opportunities. mitigation techniques and allocating
able to further augment its bottom line.
necessary resources.
Reliance’s Strategic Framework can be Reliance’s growth ambitions are fueled
divided into three pillars: by its people who are being constantly
D. DIGITAL PLATFORM
up-skilled and brought up to speed
• Approach Taking the Reliance Management
with the use of latest technologies.
System (RMS) journey forward and
• Value creation This enables the Company to leverage
to create an agile and responsive
investments in emerging technologies
• Enablers organisation, Reliance embarked on
which bring in more efficiency, which
its Digital Platforms Journey in 2018.
also leads to safer and environmentally
B. THE INTEGRATED APPROACH The move to Digital Platforms enables
friendly operations. The Company’s
Reliance is cognisant of the value it the Group to evolve the Reliance
growth also fuels fast paced economic
creates across its value chain for all of Management System (RMS) to the next
growth of the areas where it operates.
its stakeholders. This value creation level.
RIL also leverages digital technology
is not only monetary but also takes
and smart manufacturing applications
several other forms, both tangible
to create innovative solutions for
and intangible. The Company has
business functions.

110 Reliance Industries Limited  |  Integrated Annual Report 2018–19

 Corporate Management Governance Financial Notice
Overview Review Statements
1 ‒ 46 47 ‒ 183 184 ‒ 257 258 ‒ 439 440 ‒ 450

Approach Value Creation Enablers

Driving growth, value, innovation Shareholder value Reliance’s Group Strategy is founded on five
and transformation in society Reliance’s approach to drive shareholder value rests on active enablers. These include safe operations,
Reliance is moving at great portfolio management to continuously enhance the quality of its digital technology, capital productivity,
pace towards the new age of business portfolio, and consistently deliver enhanced shareholder operational excellence and ethics.
industrialisation. At the core of this returns by maintaining a focus on long-term growth potential. Reliance believes that the Health and Safety
transformation is the Company’s Employee value of its people supersedes all production
unique ability to optimise value Reliance’s growth is intrinsically linked to the growth of its people. targets. There is a continued focus on ensuring
creation from its existing asset base The Company’s approach towards value creation for its employees compliance, which helps Reliance to preserve
while simultaneously augmenting focuses on continuous learning, structured career progression enterprise value, and provide a perpetual
investments which drive growth opportunities and an industry-leading employee value proposition. license securing its right to operate across India
exponentially. Customer value and globally.
Technology is playing a pivotal role Reliance drives customer value through its product innovation Digital technologies have become the prime
in all of this and the Company is for customers, application and service levels; ability to deliver a movers of Reliance’s new-age businesses as
deriving the maximum possible value consistently better consumer experience and its overall reputation well as the significant enablers for driving the
from the ongoing digital revolution. and brand promise in the markets it operates in. efficiency and safety of existing businesses.
Reliance leverages its strategic Societal value Reliance is a pioneer in harnessing new digital
investments and leadership position Reliance is cognisant of its responsibility towards the communities technologies and mobility initiatives that
in India to take advantage of the that it operates in. Apart from creating direct and indirect economic transform its value creation model.
large domestic market while building benefits for the society such as job creation and infrastructure Reliance’s approach to maximise value creation
competencies that can be rolled out upgradation, Reliance, through a dedicated team of developmental also hinges on its ability to optimise resource
on a global scale. professionals, directly engages with the society to identify their needs and capital efficiency. Whether it is customer
All of Reliance’s business activities and designs interventions, which lead to an overall enhancement in facing and internal, Reliance drives a mind-set
and new investments have to stand the quality of life of citizens. for continuous improvement and processes
the litmus test of creating value which forms the bedrock of all its operations.
for its shareholders, employees, Reliance is committed to conduct all its
customers and society. initiatives with the highest levels of integrity.
Key Reflections of 2018-19
• Integrating backward–Started Shareholder value Safety and compliance
with textile, then integrated • *Dividend Recommended–`4,641 crore • Use of drones for safety
hydrocarbon business now a • *Market Capitalisation – `8,63,996 crore • E&P has a track record of over 10 years of
significant player in consumer • 31.9% Market Capitalisation CAGR, since IPO safe operations
facing businesses • *Maintained high RONW (adj.) of 13.7% (standalone) Digital technologies
• Global Scale • Omni-channel initiatives in Reliance Retail
Employee value
• World’s largest Refinery complex • Employing people from 16 nationalities, including 55 foreign • *GST for community
at Jamnagar nationals in the leadership team • Future Ready 5G, 6G and beyond
• “Reliance Retail” the largest • Reliance's millennial (under 30) strength grown to 49.8%
retailer by revenue in India Capital productivity
• Digital learning platforms for employees to learn anytime, • *ROCE (adj.) for FY 2018-19 – 24.9%
• Jio is shaping the future of India anywhere
through transformative, quality • *Substantial interest savings from
• R-University: Driving employee learning and training successful refinancing of long-term loans
and affordable access of end-
to-end digital services for every • *Imparted 66.93 lakh man hours of training Operational efficiencies and effectiveness
Indian and making digital India Customer value • Anytime, anywhere uninterrupted
vision a reality • 306.7 million Jio subscribers high-speed data access
• *Transforming India’s telecom landscape with a compelling Ethics
customer value proposition • Ethics and Compliance Task Force oversees
• Over 500 million footfalls across all stores of Reliance Retail and monitors implementation of ethical
• *Network18’s digital properties are used by 130 million+ people; 1 business practices
in every 4 Indian Internet user is on Network18 websites or apps
• Mottos of 'Chemistry for Smiles' and 'Transforming Life into Quality Life'
Societal value
• 1.94 lakh direct employment generation
• *`67,589 crore contribution to the national exchequer
• Reliance Foundation touched the lives of over 26 million people
since inception
• Indians impacted across 18,000+ villages and 200+ urban locations
through Reliance Foundation
• CSR activities in conformity with SDGs
• *CSR expenditure of `904 crore
*Current year outcome
Connecting everyone. Connecting everywhere. Connecting everything. The Jio Revolution. 111
MANAGEMENT DISCUSSION AND ANALYSIS (CONTD)

Sustainable Growth At Reliance

The Integrated Approach: Natural Capital and Climate Change

Pawan Kumar Kapil Par Singh

RIL incorporates Natural capital

considerations (air, water and
soil) into its decision-making at all
stages in its operational locations:
design stage, operation stage and
above all, in its interactions with
the external world. Through sound
governance, environmental impacts
of each manufacturing location are
maintained at levels which are lower
than the prescribed legal obligations
with respect to air quality, fresh
water usage, soil use, impact on flora
MATERIAL TOPICS OTHER FRAMEWORKS REFERENCED
and fauna, and marine ecosystems.
Reliance believes in the concept of
1. Energy Efficiency of Operations  PI/IPIECA, UNGC, WBCSD, GHG Protocol,
A
resource optimisation, extracting
2. Carbon Abatement and Offsetting TCFD, Natural Capital protocol, UNGP,
more value from bottom of the barrel
3. Managing Environmental Impact NVG-SEE, NGRBC
production in its hydrocarbon business
4. Water management
and handling maximum GB of data per
5. Waste management
unit of emission in its digital business.
6. Renewable and alternative energy
The Company’s strategy towards
7. Ecosystems and Biodiversity
combating climate change aims to
reduce emissions in its operations,
allow better assessment of impacts UNITED NATION’S SDGs
and support an orderly transition to
a low-carbon economy. Reliance’s
refining complex, which is the largest in
the world, is designed to operate solely
on desalinated sea water, thus making
fresh water resources from lakes and
rivers available for communi