>RELIANCE INDUSTRIES LIMITED: Sticking to knittings

• Playing to strengths: RIL chairman Mukesh Ambani reiterated group focus on domestic growth areas at the AGM. Other than core petrochem areas, he announced investments in power, telecom and retail. We believe this plays to group strengths of managing large, complex
projects in a fluid Indian regulatory environment.

• Entry into power: RIL plans to enter the power sector in India (generation, transmission and distribution). With an amended agreement between the brothers barring RIL from gas-based non-captive generation until 2022, the company would explore clean coal, hydro and nuclear
power.

• Petchem capacity additions: RIL stated its intention to build global scale in its petrochemical businesses, confirming plans to build a ~1.5mmtpa off-gas ethylene cracker at the Jamnagar refinery (43% of monomer capacity). RIL is also adding a cumulative 4.6mmtpa of polyester/polyester intermediate capacity (73% of total) to maintain its leadership position.

• E&P thrust to continue: RIL reiterated its thrust into the E&P segment, stating an intention to accelerate reserve accretion, both domestically (off-shore east coast) and internationally. The company would continue to build its shale gas portfolio in N. America. RIL also stated that they
would supply gas to RNRL once the govt. allocates gas supplies.

• Refining: The new refinery has been tested to run at 700kbopd (as against nameplate of 580kbopd). RIL also plans to build one of the world's largest petcoke gassification plants at the refinery, which would aid margins.

• Broadband/Retail: RIL outlined the vast potential of an increase in penetration of broadband technology, with partnership plans to ensure an asset light operating model. The company expects retail sales to increase 10-fold (from Rs45bn) in the next 5 years, with continued investments in various retail formats.

To read the full report: RIL