After presenting its final report on audit of Reliance Industries Limited‘s (RIL’s) KG-D6 gas block, Comptroller and Audit General (CAG) body has invited a lot of negative press as far its process of gauging industry procedures is concerned.

CAG, in its audit draft report, had lashed out against RIL for allegedly overstating its costs, while also pointing a finger at the oil ministry for showing laxity in implementation and management of production sharing contracts (PSCs). Reliance Industries took a stand on the charges stated by CAG saying that CAG had missed the mark as far as gauging E&P procedures, in relation to internal and external factors, is concerned. While RIL maintains that irrespective of the report, it continues to maintain a strong adherence to global benchmarking procedures, the after math of the allegations has left many operators in oil and gas sector questioning the forethought of the audit body.

Industry experts have stepped up in support of Reliance’s stand sharing the view that the entire shenanigan put up by CAG has left a detrimental mark on the reputation of the E&P sector. Also, independent reports by experts from E&Y, IPA and Daniel Johnston & Co. Inc. have entirely validated RIL’s stand in its responses to CAG. These independent reports have acknowledged RIL’s commendable efforts in ‘bringing to stream India’s first deep water hydrocarbons production facility in record time’ and the fact an energy major as big as BP Plc has entered into a strategic partnership with RIL in this exact block further strengthens Reliance’s stand and justifies its efforts and processes to a large extent.

As for the issue that has been stretched out of proportion by CAG, one thing that finds common ground in all opinions, including those of industry leaders and experts is that CAG has obtusely relied on going by book as against gauging a situation based on current trends and economic factors. Questioning the prudence of an operator is not a part of CAG’s mandate and questioning the technical and operational judgments of an operator that were in effect the best possible judgments at the time, is a factor that must find precedence in evaluating any procedure.

Comptroller and Audit General’s (CAG) final audit report on alleged irregularities in production sharing contracts (PSCs) in energy and petroleum sector has finally found the light of day, but on an incongruous note. While the report has criticized the government for allowing private operator Reliance Industries Limited (RIL) to retain an entire block after the first phase of exploration in violation of its PSC, it also happened to praise the government, ratheraberrantly, for developing world-class, deep-sea infrastructure in record time. CAG has also made a recommendation that the PSC structure be modified and that the government play a more vigilant role in the operations of the same.

Commenting on the audit report, RIL maintained that irrespective of what the report suggests, it has put in place a global benchmark for efficiency, project completion and capital costs in developing India’s oil and gas fields in a continually challenging environment. “We are proud of our achievements,” the company statement added.

Enconters with CAG have been a mixed bag of emotions for all players in E & P sector. The audit reports are known to be out and out harsh on the first count. Following many discussions with the company management and analysis of situation from an operator’s perspective is the stance diluted to an extent. However, many industry experts are of the view that this entire shenanigan by CAG has somewhat made a detrimental mark on the reputation of the E & P sector. As far as making recommendations to the industry procedures is concerned, many experts are of the opinion that CAG is not necessarilytechnically sound enough to do so.

As crude prices have consistently charted an escalating graph over the last five years, the production and development costs have proportionately been affected for almost all operators, especially those engaged in the deep water exploration projects. Experts, including R S Sharma, former ONCG chairman, have opined that capital investment, especially from private players in E&P space,is needed to explore and develop India’s large sedimentary resources, which lay undeveloped. Such reports which discourage foreign investment sentiments reflect badly on the industry and its players on the whole.

As the issue enters a steaming stage, industry experts have stepped up with their opinions regarding the matter concerning Reliance Industries Limited (RIL) and the allegation put on its account by Comptroller and Audit General (CAG) body of India. The subject matter of concern revolves around the allegation made by CAG accusing RIL of gold-plating its capital expenditure incurred on its oil and gas acreage, including KG D6 block, and a parallel assertion made on account of the oil ministry for allowing such price escalation, that too in violation of production sharing contract s (PSCs).

CAG had submitted its initial report on the KG D6 audit earlier in June, red lining many aspects of RIL’s production process, however, the audit report has failed to rationalize any claims it has made against RIL. RIL, in its reply to the audit report, had stated that the increase in cost was a result of increase in cost of deep sea exploration process altogether. Due to rise in cost of procurement of technology and labor worldwide, a ripple affect found its way to Indian operators as well, including Reliance. CAG had also noted that because of this unwarranted increase in cost, the government is at the brink of facing heavy losses, to which RIL has replied that it is in fact the operator that stands to face heavy losses; while the government stands to regain its share through reduction of subsidiary burden.

At present, when CAG is in the process of finalizing its audit report regarding RIL, industry experts have come to suggest that CAG is not the right body to raise questions at the prudence of an operator and question the technical and operational judgments of the operator that were in effect the best possible judgments at the time. It should consider every factor, internal and external, which led to a possible situation and try to reason the action undertaken by taking in the viewpoints of the operator as well. CAG cannot use a pre-existing yardstick to reason an outcome, which could have been taken as necessitated by the situation. Also, to suggest changes in the PSC is matter of deliberation for concerned authorities and not CAG.

Reliance Digital – India’s popular electronics retail destination – has opened its latest store in the buzzing city of New Delhi at Moments Mall, Kirti Nagar. This is Reliance Digital’s 5th store in the capital city. This is Reliance Digital’s fifth store in New Delhi, aside from those located in Vasant Kunj, Dwarka, Gurgaon and Ghaziabad.

Staying true to Reliance Digital’s long drawn tradition of ‘Bringing Technology to Life’, the latest store in Kirti Nagar certainly packs a punch. As a part of special launch festivities, Reliance Digital has put in place exclusive launch offers which range from price-offs and discounts to exchange offers. As a part of the ‘Mismatch Exchange’ scheme, customers can bring in their old refrigerators, washing machines and television sets in exchange for any of the latest electronic product from the store. Apart from this, all customers stand a chance to win assured gifts with every purchase made during the special launch festivities. Reliance Digital Store is also offering a special purchase scheme where customers can take home any product of their choice at an easy EMI of just Rs. 51. And every purchase will be backed by Reliance Digital’s customer support team at ‘Reliance resQ’, available 365 days a year.

About Reliance Digital: Reliance Digital is a multi-brand electronics retail chain from the house of Reliance, offering a multitude of electronic products and brands to choose from. From High end LCD and LED TVs, refrigerators, washing machines, microwave ovens, mobile phones, laptops, gaming consoles and software, home appliances, mp3 players to even the smallest of IT based devices, Reliance Digital carries it all. Spread over 10,000 sq.mt of space, Reliance Digital stores are spacious, well furnished and carry over 4000 products of 150 brands from world over.

Reliance Digital, the large format, multi-brand electronics retail store chain launches its new store in Dwarka, Delhi on 25th June 2011.

Reliance Digital brings a host of exciting propositions to its customers along with its launch in Delhi.

There would be a 15 day lowest price guarantee to assure customers of the best prices, a first in the industry. Moreover, easy financing options will be available to consumers shopping at the store in order to make shopping easier for them.

Apart from the Lowest Prices, customers at Reliance Digital Store in Delhi will also be greeted with Special Launch Offers. There would be an exchange offer, whereby customers can exchange their old Mobile phones for brand new electronics and appliances, with upto Rs 4,000 discount. There would be exchange offers for old TVs, Refrigerators, ACs & Washing Machines as well.

The first 100 customers would also be walking away with assured gifts, and get an opportunity to spin the ‘Wheel of Fortune’ with a chance to win Gift Vouchers.

There is a special finance offer for limited period, through which customers in Delhi will be able to walk away with any product by making an initial payment of Rs. 51 (Offer valid till 26th June).

The store provides Valet parking facilities for visitors. The store itself contains a Gaming Zone, an Experience wall and on the spot finance services.

More details are available on the website www.reliancedigital.in

Phone No: 011- 64781344/45

About Reliance Digital: Reliance Digital is the CDIT (Consumer Electronics, Durables, IT & Telecom) retail arm of Reliance Retail Group. It currently spans across 31 stores across 17 cities within the country with an average store space of around 10,000 sq. ft. Reliance Digital sells a wide range of CDIT products & solutions ranging from High-end LCD, LED & Plasma Televisions, Refrigerators, Washing machines, Microwave Ovens, Digital Cameras, Laptops, to small items like IT accessories, HDMI cables & Pen drives. It also sells the entire Apple range.

Nita Ambani is the quintessential woman of modern times. Not only is she the first lady of corporate India, today she embodies almost every plausible characteristic that delegates to her the title of woman of substance. From supporting the varied ventures assumed by her husband Mukesh Ambani, Chairman of Reliance Industries Limited (RIL), to being an exceptional home maker; from being a proactive philanthropist to running a full-fledged IPL cricket franchise of Mumbai Indians, Nita Ambani does it all. And in the light of her most dear undertaking of Mumbai Indians, Nita Ambani invariably invokes inspiration.

Today, Mumbai Indians team is synonymous with two things – Sachin Tendulkar and Nita Ambani. While Sachin Tendulkar controls the reins on the field, Nita Ambani is present upfront to support her team in every way possible off the field. After a luckless start in the initial seasons of IPL, Mumbai Indians team was being regarded as an otiose undertaking. But Nita Ambani stepped up to the challenge of reforming this conception. After much re-structuring and adjustments to team’s administration, Mumbai Indians were invigorated to start afresh. Nita Ambani was determined to ensure her team’s comeback, and by the third season of IPL, her team had made it. Today, Mumbai Indians is more than just an undertaking; it is a flourishing team with high marketable and value quotient. The backing it received from the Ambani countess enabled the team and encouraged everyone associated with the team to push their mettle.

What is more admirable is the fact that she is a proactive female proprietor of a massive cricket franchise, which is largely male dominated – both in terms of players and their respective proprietors. It is good to see a woman take center stage in a male eclipsed sport, overlooking and managing it with all her capacity. Not only is she proactive in her team’s management but also in the know-how of the sport. She took the initiative to know the game and its working before commencing on its actual remodeling and subsequent supervision. Realizing the need to colligate the streamlining efforts, attune with the form of the team and its players, Nita Ambani took to the cause ardently. And the success of Mumbai Indians today is a testament of her triumphant efforts.

Reliance Trends, the retail chain that offers quality and fashionable clothing at low prices, is chalking out major expansion plans. The apparel arm of Reliance Retail is all set to expand its current base of 16 stores across the country to 155 by 2012 across 90 cities. Arun Sirdeshmukh, Chief Executive Reliance Trends says “You will see now and for the next two years, our growth rate would be far higher than any apparel retailer in the market.” According to senior company officials, with their incredible price offering, Reliance Trends is all set to revolutionize the apparel industry in India.

Conceived nearly two years ago, Reliance Trends’ mission is: to offer the common man quality and fashionable clothing at remarkably low prices. And although the company has had a slow start so far, it now plans to move ahead aggressively. Mr. Sirdeshmukh says that in the last year they have worked hard to create a blueprint for the next three years. From three stores in 2007-08 they moved to 10 in 2008-09 and by March 2010 they will have 21 stores. “Reliance Trends is probably the only format/retailer that has not closed down a single store during the slowdown,” he informs.

The main focus of Reliance Trends is affordability. At every stage of making a garment, they try and save every rupee without compromising on the quality. Right from sourcing raw materials to choosing business partners and designing, pricing is kept in the forefront. The biggest business for Reliance Trends is from the private labels and nearly 60 per cent of revenue comes from the private brands. Besides this Reliance Trends also stocks leading national and international brands.

Among the many exciting offerings from Reliance Trends are First Class jeans at just Rs 199. An anti-wrinkle business suit which costs around Rs 4,500 on an average is priced at Rs 2,499 at Reliance Trends. Among others, Reliance Trends also has a collection of technology clothes. These are fragrant clothes for infant, stain-free trousers, shirts and trousers with in-built moisture management and the like.

Recently, Reliance Trends was awarded the Asia Retail Congress – Retail Marketing Campaign of the year Award. So, with this new growth plan, approach and rapid expansion is Reliance setting new “Trends”.

Source:http://news-views.in/reliance-trends-a-growth-path/

Lured by rising consumer demand and a huge untapped market, organised shoemakers and retailers such as Reliance Footprint and Metro Shoes, Catwalk are scaling up their presence to get a foot in the Rs 11,900 crore retail shoe market in the country.

Reliance Footprint, part of Reliance Retail, plans to spend Rs 400 crore to add 100 outlets across the country in two years to sell branded footwear such as Gel-Kayano of Asics, Adidas and Hush Puppies in its stores.

“The premium segment is growing at the rate of 15%, hence there is tremendous opportunity for eryone,” said Gopalkrishnan Sankar, CEO of Reliance Footprint, which sells mid to high-end products.

The Mukesh Ambani firm, which now runs 16 outlets, recently tied up with premium global brands such as Timberland of the US and Pavers of the UK has planned to scale up till 100 outlets. With the country’s economy continuing to flourish despite the global downturn and population growing younger, richer and more aspirational than ever, India has become one of the most lucrative markets for footwear players.

“India is big opportunity for retail shoe business as well as premium shoe brands. This segment grew by 12% last year, which was an abnormal year due to the global financial crisis.

Source:http://economictimes.indiatimes.com/news/news-by-industry/services/retailing/Retailers-scale-up-ops-to-get-foothold/articleshow/5536578.cms

The Dutch Government’s Nodal Investment Agency says that they will support RIL’s for LyondellBasell if the deal goes through. The Netherlands, which is supporting Mukesh Ambani’s $12 billion plus bid for the Rotterdam based pet-chem giant, is the parent country of LyondellBasell.

Bass Pulles, Commissioner of the Dutch Foreign Investment Agency, which facilitates investments in an exclusive interview with ET Now’s Sumit Chaturvedi, in Hague, Netherlands said the government will support RIL’s bid for LyondellBasell. “Since RIL is a foreign company, and so is LyondellBasell, we do offer assistance in the process which surrounds the take over, for instance speeding up immigration procedures or giving a warm shoulder from the ministry”, he said.

Reliance Industries Limited submitted an all-cash non-binding bid to buy a controlling stake in LyondellBasell in 21st of November, 2009. The bid came after LyondellBasell, the third largest petrochemical company in the world, filed for bankruptcy in January, 2009. The deal, if consummated, would facilitate growth of Reliance’s core business. As LyondellBasell has large petrochemical capacities coupled with a good tech portfolio as well as joint ventures in the Middle East, it would help Reliance Industries grow and reach the Western markets.

In December, 2009 Reliance Industries stated that it had no intentions of buying any of the debt from LyondellBasell. The month of January, 2010 witnessed Mukesh Ambani-led Reliance Industries stepping up its offer for the acquisition by offering $13.5 billion instead of the earlier $12 billion.

The Netherlands government support comes as a shot in the arm for Mr. Mukesh Ambani as he prepares to bid for the Rotterdam based LyondellBasell. When asked why the vote of confidence, Pulles said, “They might consider to reinvest again, they might send out positive message to other companies back home or they might inform us on any other strategic developments in their industry.”

The Netherlands is home to global brands like Philips, ING Bank and wants to attract more talent and capital from India. They already have big investments from over 120 odd companies in India such as Infosys and TCS. If Mukesh Ambani does tide over the resistance from some lenders of LyondellBasell, he can be rest assured about support from Dutch Authorities.

News Video :- http://www.youtube.com/watch?v=kDRan0kps6k

Higher natural gas production from the KG D6 fields off the eastern coast of India is likely to buoy revenues of Reliance Industries Ltd, or RIL, in the December quarter though lower margins on petrochemicals and oil refining are expected to temper profit growth, according to analysts tracking India’s most valuable company.
RIL is scheduled to announce its quarterly results on Friday.
A Mint poll of six domestic and foreign brokerages forecast an expected average net profit of Rs3,921 crore for the October-December quarter, an increase of 12% over the corresponding quarter of the previous fiscal, and average revenue of Rs51,577.2 crore, a jump of 63.4%.
Eroding revenue: RIL’s Jamnagar refinery. Lower margins on oil refining and petrochemicals are expected to temper the firm’s profit growth. AFP
The poll also pegged RIL’s gross refining margins (GRMs)—or earnings from turning crude oil into a number of high value fuels and products—at nearly $5.7 (Rs260.49) per barrel, way short of the $10 a barrel levels in the same quarter last year.
In a 6 January note to their clients, Mumbai-based Edelweiss Securities Ltd’s analysts Niraj Mansingka, Ruchi Vora and Abhishek Agarwal wrote: “RIL’s earnings will benefit from the ramp-up of KG D6 gas volumes. However, muted refining margin expectations and decline in petrochemical margins will limit results.”
Pointing to the possibility of the Mukesh Ambani-led company reporting the “lowest ever GRMs in the past several quarters” owing to a weak refining environment, Rohit Nagraj, sector analyst for Prabhudas Lilladher Pvt Ltd, wrote in his report the same day: “Petrochemical prices remained stable during the quarter. However, the feedstock prices moved up slightly. Hence, (these) margins are anticipated to be a tad lower sequentially (compared with July-September quarter).”
According to Nagraj, average Krishna-Godavari basin gas volumes, an estimated 45 million cu. m a day (mscmd) this quarter, will add heft to RIL’s profits.
Another analyst with the Indian arm of a foreign brokerage said one of the key things to watch out for was whether RIL’s new 580,000 barrels a day Jamnagar refinery has stabilized its operations or not. “KG D6 gas and the new refinery are assets that are contributing to revenues this year. Not only were these revenue taps not turned on last year, the corresponding quarter last year was also affected by adverse demand conditions in the aftermath of the global meltdown, leading to a base effect.” Base effect refers to an unusual spike or drop in a company’s financials in one quarter due to extraordinary reasons. Year-on-year comparisons in such cases appear much better or worse.
The analyst, who did not want to be named, agreed that it was business as usual for the oil-to-yarn and retail conglomerate, and that much of the “noise surrounding the company has been on account of its acquisition efforts or fund raising exercises”.
Reliance Group has submitted a preliminary, non-binding bid for the bankrupt Dutch petrochemical maker LyondellBasell Industries AF in its largest and most ambitious acquisition attempt. Analysts are watching how far RIL will go to acquire the firm, which is being valued upwards of $13.5 billion by the Street and will need to be integrated in the difficult labour markets of the US and Europe. As of now, its offer is being pushed back by the existing management and secured creditors of LyondellBasell, which could mean that RIL will have to sweeten the bid and raise its offer price.
RIL has raised nearly Rs12,980 crore by selling its treasury stock in three tranches over the last four months, most likely to create a war chest for the LyondellBasell deal.
RIL’s takeover bid comes on the back of a subdued sectoral outlook. Motilal Oswal Securities Ltd’s analysts Harshad Borawake and Milind Bafna in their sector preview report have said that they “expect margin pressure on petrochemicals to continue from likely supply from new Middle East petrochemcial plants”.
RIL could look forward to revenues from KG basin as gas production is expected to be ramped up to 60 mscmd by December and 80 mscmd by March, added Borawake and Bafna.
Gas revenues, however, depend on the outcome of a three-year-old legal battle between RIL and Anil Ambani’s Reliance Natural Resources Ltd. The latter is claiming 28 mscmd of gas at a price 44% cheaper than the government price, citing a family demerger arrangement in 2005. The matter is awaiting a decision from the Supreme Court.

Source:http://www.livemint.com/2010/01/18211608/RIL8217s-Q3-profit-expected.html