Reliance Industries Ltd has created a record of sorts by becoming India’s first private sector company to make a net profit of over $1 billion. The oil/petrochem giant’s profits are equivalent to the sales of Infosys and Wipro which became $1 billion sales companies recently.Government-owned Indian Oil Corporation and ONGC are already in the $ one billion profit club.Beating market expectations, Reliance — India’s largest private sector firm — has made a net profit of Rs 5,160 crore for the year ended March 2004, an increase of 26 per cent over last year’s profit of Rs 4,104 crore. Its gross turnover was a staggering Rs 74,418 crore as against Rs 65,061 crore.Despite announcing good results, its shares fell more than two per cent to Rs 529.20 on the stock exchanges. The BSE Sensex too declined by 45 points to 5,668.43 on sustained selling pressure.Addressing a news conference here today, Reliance Vice Chairman and Managing Director Anil Ambani announced a capital expenditure plan of Rs 35,000 crore in the next five years.Talking about his various business units, Ambani said Reliance will set up 5,000 retail outlets by investing Rs 7,000 crore. It has already started 11 outlets which are selling products from RIL’s Jamnagar refinery. ‘‘We are happy with Reliance’s performance in year which showed clear signs of petrochemical business entering into an upcycle,’’ said Ambani, adding, ‘‘The significant improvement in diesel consumption during the second half of the year marks a welcome reversal of low to negative growth trends observed in the first-half of current fiscal.’’The board which met on Thursday recommended a 52.2 per cent dividend (Rs 5.25) per equity share of Rs 10 each, involving a payout of Rs 825 crore. The company, during the fourth quarter ended March 31, 2004, reported a 29 per cent rise in its net profit of Rs 1,419 crore as against of Rs 1,101 crore while the total income grew to Rs 14,585 from Rs 13,081 crore posted during the same period previous fiscal.The production of oil, gas and petrochemicals rose by four per cent to 12.4 million tonnes, Ambani said. The Jamnagar refinery operated at 109 per cent and processed 29.6 million tonnes of crude. Total assets of the company stood at Rs. 71,157 crore. On its infocom venture, Ambani said the parent company will stop making any further investment and Reliance Infocomm will generate its own cash flows and take debt to fund its future plans. Apart from providing telecom solutions and broadband, Reliance Infocomm will also offer value added services like video-on-demand, Ambani said. Reliance Infocomm has cornered 22 per cent of the Indian mobile phone market with seven million customers. By year-end Infocomm will have enough capacity to provide 40 million telephone lines.
