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					                                                                                                                       Annual Report Update
                                                                                                                          SECTOR: OIL & GAS




                                                                                                     Reliance Industries
STOCK INFO.            BLOOMBERG
                                              3 June 2010
BSE Sensex: 17,022 RIL IN                                                                                                                Buy
                       REUTERS CODE
S&P CNX: 5,113         RELI.BO               Previous Recommendation: Buy                                                             Rs1,031
 Equity Shares (m)                3,286.2
 52-Week Range               1,186/841
 1,6,12 Rel. Perf. (%)            3/-5/-23
 M.Cap. (Rs b)                    3,388.1
 M.Cap. (US$ b)                      72.7

                                             All adjusted per share info and valuation ratios are adjusted for treasury shares held by company
RELIANCE ANNUAL REPORT 2010
                                              FY10 Annual Report Analysis
                                              Expanding gross block, contracting RoE

                                                  Commissioning of mega projects leads to doubling of balance sheet size
                                                  in three years: RIL’s balance sheet size has doubled in three years, led by its
                                                  investments in KG-D6 and the RPL merger. Its gross block has more than doubled
                                                  in the last two years, led by commissioning of the KG-D6 project and the merger
                                                  of RPL. Capitalized cost of KG-D6 is ~Rs390b while that of RPL is ~Rs330b.
                                                  RoE depressed due to higher DD&A and increased tax rate: RIL’s RoE for
                                                  FY10 was depressed at 13.4% v/s an average of 20% in the last three years, led
                                                  by higher DD&A charge, reduction in interest capitalized, and higher tax rate
                                                  (21% in FY10 v/s an average of 16% in last three years).
                                                  Average interest cost down 390bp to 4.4%: Gross interest cost for FY10 was
SHAREHOLDING PATTERN % (MAR-10)
                                                  4.4% v/s 8.3% in FY09. As 85% of RIL's total debt is forex-denominated, its
   Others                         Promoter        interest cost is partly a reflection of LIBOR rate, which declined from 2.9% to
   22.5%                           44.9%          1.3%. Despite 15% reduction in gross debt, net interest cost increased 14% to
                                                  Rs20b, led by lower interest capitalization (33% in FY10 v/s 66% in FY09).
                                                  1P reserves remain almost flat over the last four years: Though RIL has
                                                  reported large number of discoveries in the last few years, its 1P (only reports 1P)
                                                  reserve numbers have not increased significantly. Total reserves remained flat in
                                                  FY10 at 1.5bboe. We expect RIL to upgrade its reserve numbers once the appraisal
 Foreign
                                                  of the pending blocks is completed and approved by DGH (Director General of
  22.0%          Dom. Inst
                  10.5%
                                                  Hydrocarbons).
                                                  E&P has highest share in capex and depreciation: KG-D6 production start
                                                  has lead to significant increase in the depletion charge for RIL, resulting in highest
STOCK PERFORMANCE
                                                  share in the overall company depreciation. Also, in terms of capex share, E&P
               Reliance Inds.
               Sensex - Rebased                   capex was highest in FY10 at Rs118b as against total capex of Rs219b.
 1,400
                                                  Key things to watch: We believe investors should focus on: (1) ramp-up of KG-
 1,250                                            D6 volumes; (2) clarity on 7-year income tax holiday for KG-D6 gas (we model
                                                  tax holiday); (3) margin trend in refining and petchem and (4) any announcements
 1,100                                            in terms of new projects, acquisitions, discoveries. (We estimate US$8b of FCF
   950
                                                  over next 2 years).
                                                  Valuation and view: We value RIL on SOTP basis to arrive at a price target of
   800                                            Rs1,133 (incl E&P upside potential of Rs205/share). Adjusted for treasury shares,
     Jun-09   Oct-09     Feb-10     Jun-10
                                                  RIL trades at 11.7x FY12E EPS of Rs87.9. Maintain Buy.


Harshad Borawake (HarshadBorawake@MotilalOswal.com);+91 22 39825432/Milind Bafna (Milind.Bafna@MotilalOswal.com); +91 22 39825445
                                                                                                                                     Reliance Industries




                                                   Highlights of FY10 Annual Report

                                                   RIL's balance sheet size doubles in three years (Rs b)
                                                                                     FY07                   FY08              FY09                     FY10
 2.5
        Balance Sheet size                         Shareholders Funds                 640                 814                1,264                    1,372
 2.0
        (Rs Trillion)                              Total Debt                         278                 365                  739                      625
 1.5
                                                   Deferred tax Liability              70                  79                   97                      109
 1.0
                                                   Total Liabilities                  988               1,258                2,100                    2,106
 0.5
                                                   NFA + CWIP                         712                 849                1,694                    1,654
 0.0
                                                   Investments                        163                 221                  216                      232
       FY90

              FY94

                     FY98

                            FY02

                                   FY06

                                            FY10




                                                   Net Current Assets                 113                 188                  190                      220
                                                   Total Assets                       988               1,258                2,100                    2,106




                                                   Gross block up Rs662b in FY10 v/s cash flow capex of Rs219b
 2.5
        Gross Block                                RS B                       FY06           FY07            FY08     FY09            FY10        YOY CHG
 2.0
 1.5
        (Rs Trillion)                              Gross Block                850             995           1,042    1,496           2,159               662
 1.0                                               Depreciation               293             359             423      493             626               133
 0.5                                               Net Block                  557             637             619    1,003           1,533               529
 0.0                                               CWIP                        70              75             230      690             121             (569)
       FY90

              FY94

                     FY98

                            FY02

                                   FY06

                                            FY10




                                                   Total (GFA + CWIP)         919           1,071           1,272    2,187           2,280                93




                                                   Despite Rs80b reduction creditors for capex are still high at Rs88b
                                                          (Rs b)
GROSS BLOCK CHANGE
                                                                                                                        168
DETAILS                                   RS B

Cashflow Capex            219
Change in CWIP            569
Interest Capitalized       10
                                                                                                                                                 88
Reduction in CL          (80)
towards Capex
Forex Difference         (53)
Other Adjustments          -3                                                         18                23
Total                     662                                      7
        Source: Company/MOSL
                                                               FY06                  FY07              FY08             FY09                 FY10




                                                   RIL’s FY10 RoE at 13.4%
                                                                       Depreciation as % of GFA             ROE     Interest capitalized (RHS)

                                                                                 22.4%                 21.5%           66.1%
                                                       21.9%
    TRIO (high D,D&A lower
  interest capitalization and                                                                       45.1%              15.7%
                                                              42.1%
                                                                                                                                                 13.4%
higher tax rate) impacts RoE                                                     31.0%
                                                                                                                                                      33.0%
                                                             4.9%                    5.2%              4.8%             4.1%                       5.7%



                                                             FY06                FY07                 FY08             FY09                  FY10




3 June 2010                                                                                                                                                    2
                                                                                                                               Reliance Industries



                                 FY10 gross debt down 15% while net debt down 5%
                                 (RS B)                              FY06                FY07               FY08               FY09               FY10

RIL’s Debt to Equity remains     Gross Debt                           219                 278               365                 739                625
 low at 0.46…. augurs well       Cash                                  21                  18                 43               222                135
                                 Net Debt                            197                 260                322                517                490
            for any big ticket
                                 Debt / Equity (x)                   0.44                0.44               0.45               0.58               0.46
   acquisition/investment …      Net Debt/Equity (x)                 0.40                0.41                0.4               0.41               0.36




                                 Sharp reduction in interest capitalized to 33% and cost of debt to 4.4%
                                 (RS B)                              FY06                FY07               FY08               FY09               FY10

                                 Total Debt                        219                   278            365                        739                625
                                 Total Debt (with RPL)                -                  333            493                        739                625
  Average interest cost down     Gross Interest                     15                     17            20                         51                 30
                                 Interest Capitalized                6                      5             9                         34                 10
            to 4.4% v/s 8.3%
                                    As a % of Gross Interest        42                     31            45                         66                 33
                                 Interest                            9                     12            11                         17                 20
                                    Interest Rate (%)              7.4                    6.9           6.1                        8.3                4.4
                                 83% of RIL’s loans are forex denominated; *1 year       LIBOR was at 1.3% in FY10 v/s             2.9% in FY09




                                 No increase in reserves over the last four years
                                 PROVED RESERVES              FY03        FY04        FY05          FY06        FY07        FY08       FY09       FY10

                                 Crude Oil (mmt)
                                 Opening Balance              5.34      4.97        5.18          5.70       6.71       12.47         11.64       11.02
     No increase in reserves     Addition/(deletion)                    0.61        0.95          1.53       6.33       -0.16          0.12        1.13
                                 Production                -0.37       -0.40       -0.43         -0.52      -0.57       -0.67         -0.74       -1.04
  despite increase in number
                                 Closing Balance            4.97        5.18        5.70          6.71      12.47       11.64         11.02       11.11
               of discoveries    Natural Gas (bcm)
                                 Opening Balance           23.27       82.72     136.44         172.63     178.67      222.15        222.19    220.47
                                 Addition/(deletion)       60.40       54.62      37.23           7.17      44.68        1.71          0.17      5.35
                                 Production                -0.94       -0.90      -1.04          -1.12      -1.21       -1.66         -1.89    -14.61
                                 Closing Balance           82.72      136.44     172.63         178.67     222.15      222.19        220.47    211.21
                                 Total (Oil + Gas)
                                 In mmt                   79.42       127.97   161.06   167.51   212.40   211.61   209.44   201.20
                                 In mmboe                585.34       943.16 1,187.04 1,234.58 1,565.39 1,559.56 1,543.58 1,482.86




                                 RIL reported 42 discoveries till March 2010 in its domestic acreage

                                      19
                                                                          Blockwise Discoveries
Only KG-D6 has commenced
    production, many other
  blocks to follow in future
                                                 8


                                                          3           3           3
                                                                                                2
                                                                                                            1           1             1           1


                                    KG-D6     NEC-25   KG-III-5      KG-D3       CB-10       KG-III-6      GS-01       CY           KG-D4     Pre-NELP




3 June 2010                                                                                                                                             3
                                                                                                                                         Reliance Industries



                                RIL reported 42 discoveries till March 2010 in its domestic acreage
                                  Steady Rate of Discoveries                                                            KG-D4
                                                                                  KG-III-6       P re-NELP                1
                                                                                    2                 1
   Consistent discovery rate
                                                                                                     KG-III-5           GS-01
    over the years…..success                                   NEC-25         NEC-25
                                                                                                        1                 1
                                                                 4              2                    NEC-25             KG-D3
     rate of 54% - one of the                                                                           1                 1
             highest globally                                                                                          KG-III-5                       CB -10
                                                                                                                         2                             3
                                    KG-D6                                         KG-D6              KG-D6                              KG-D3
                                      4                        KG-D6                4                  4                NEC-25
                                                 KG-D6                                                                                    1
                                                                 3                                                        1
                                                   2                                                                    KG-D6                         KG-D3
                                                                                                                                        KG-D6
                                                                                                                          1                             1
                                                                                                                                           1
                                     FY03        FY04             FY05            FY06                FY07               FY08            FY09          FY10




                                E&P capex share remains high
                                SEGMENTAL CAPEX (RS B)                      FY06                FY07                   FY08             FY09          FY10

                                E&P                                          22                  57                    134              103           118
                                Refining & Marketing                         32                  63*                   191*             103           94
                                Retail Marketing                              -                   -                      -                -            -
  E&P share highest in total    Petrochemicals                               32                   5                      5               25            7
                                Common                                        9                  14                     29               16            0
   capex led by development
                                Total                                        95                  138                   360              247           219
        expenses for KG-D6      Break-up (%)
                                E&P                                         23                   41                    37               42            54
                                Refining & Marketing                        34                   45                    53               42            43
                                Retail Marketing                             0                    0                     0                0             0
                                Petrochemicals                               34                   3                     1                10            3
                                Common                                       9                   10                     8                7             0
                                Total                                       100                  100                   100              100           100
                                *Adjusted for RPL capex


                                E&P DD&A share highest in total depreciation
                                ACTUAL DEPR BREAKUP (%)             FY05             FY06                FY07                 FY08            FY09        FY10
      Higher depletion with     Petrochemicals                   38.8        41.1         53.6                             48.2            42.2          19.6
    commencement in KGD6        Refining                        42.3         49.5         37.6                             38.5            37.0          30.9
     production contributes     E&P                               0.0         0.0          8.3                             11.0            12.5          44.7
                                Others                           16.3         9.2          0.2                              1.4             7.1           3.3
   45% to total E&P D,D&A
                                Unallocable                       2.6         0.2          0.2                              0.9             1.2           1.6
                                Total                          100.0        100.0        100.0                            100.0           100.0         100.0
                                *RIL follows Full Cost Method of Accounting for its E&P business


                                FY10 petchem volumes rebound strongly
                                PETCHEM ('000 MT)          FY06            FY07               FY08              FY09         YOY (%)           FY10    YOY (%)

FY09 volumes were impacted      PP                        1,285          1,641               1,712           1,466                -14      2,399               64
                                PE                        1,031          1,011               1,083             996                 -8      1,068                7
       by (1) de-stocking by
                                PVC                         619            562                 579             614                  6        624                2
 customers and (2) RIL plant    Total Polymer             2,935          3,214               3,374           3,076                 -9      4,091               33
               shutdowns….      PFY                         497            663                 683             646                 -5        724               12
                                PSF                         557            718                 621             559                -10        597                7
                                PET                         220            257                 268             329                 23        345                5
        …. FY10 production
                                Total Polyester           1,274          1,638               1,572           1,534                 -2      1,666                9
     increase was led by (1)    PX                        1,395          1,779               1,878           1,879                  0      1,875                0
 higher demand and (2) new      PTA                       1,304          1,777               2,035           1,978                 -3      2,049                4
    900KTA PP plant in SEZ      MEG                         776            781                 801             726                 -9        695               -4
                                Total Intermediates       3,475          4,337               4,714           4,583                 -3      4,619                1
                    refinery
                                Total                     7,684          9,189               9,660           9,193                 -5     10,376               13



3 June 2010                                                                                                                                                      4
                                                                                                                  Reliance Industries



Related party transaction value has increased substantially YoY
KEY RELATED PARTY COMPANIES (RS M)                 FY09      FY10   (RS M)                                              FY09      FY10

Arranged company-wise                                               Arranged category-wise
Reliance Ports and Terminals                     12,597    27,620   Electric Power, Fuel and Water                      6,857    9,603
Reliance Utilities Private                         3,959    6,745   Reliance Utilities and Power Private                2,899    2,858
Reliance Jamnagar Infrastructure                     600    3,732   Reliance Utilities Private                          3,959    6,745
Reliance Gas Transportation Infrastructure (RGTIL)    71    3,146   Hire Charges                                          763    5,590
Reliance Utilities and Power Private               2,899    2,858   Reliance Europe                                        46        -
Reliance Retail                                      937    1,059   Reliance Industrial Infrastructure                    225      320
Gujarat Chemicals Port Terminal Company              421      489   Gujarat Chemicals Port Terminal Company               421      489
Reliance Infosolutions Private                         -      480   Reliance Gas Transportation Infrastructure             71    3,146
Reliance Supply Chain Solutions                      210      360   Reliance Ports and Terminals                            -    1,636
Reliance Corporate IT Park                             -      215   Manpower Deputation Charges                           446    1,266
Reliance Industrial Infrastructure                   132      208   Reliance Retail                                       208      337
Reliance Europe                                      212      202   Reliance Trends                                       120        -
Reliance Polyolefins                                   -       90   Reliance Petroinvestments                              28        -
Reliance Fin. Distr. and Advisory Services           140       50   Reliance Industrial Infrastructure                     42      118
Reliance Trends                                      120        -   Reliance Ports and Terminals                           45      741
Reliance Petroinvestments                             28        -   Others                                                 36       70
Total                                            22,325    47,252   Payment to Key Managerial Personnel                   382      409
                                                                    Sales and Distribution Expenses                    26,050   26,050
                                                                    Reliance Retail                                       728      721
                                                                    Reliance Ports and Terminals                       12,553   25,244
Value of related parties transaction doubled YoY led by             Others                                             12,769       85
                                                                    Professional Fees                                     556    1,131
(1) payment for utilizes used by new SEZ refinery and
                                                                    Reliance Financial Distribution and Advisory Services 140       50
(2) gas transportation tariffs paid to RGTIL                        Reliance Supply Chain Solutions                       210      360
                                                                    Reliance Infosolutions Private                          -      480
                                                                    Reliance Europe                                       166      202
                                                                    Others                                                 40       39
                                                                    General Expenses                                      751    4,021
                                                                    Reliance Jamnagar Infrastructure                      600    3,732
                                                                    Reliance Polyolefins                                    -       90
                                                                    Reliance Industrial Infrastructure                     90       90
                                                                    Others                                                 61      109
                                                                    Donations                                             372      190
                                                                    Dhirubhai Ambani Foundation                           355      163
                                                                    Others                                                 18       27
                                                                    Interest                                               36    2,145
                                                                    Reliance Corporate IT Park                              -      215
                                                                    Others                                                364    1,931




3 June 2010                                                                                                                          5
                                                                                                           Reliance Industries



                                 Retail venture yet to stabilize – FY10 losses at Rs2.6b
                                 (RS M)                                        TOTAL ASSETS      REVENUE      PBT         PAT

                                 Reliance Fresh                                        18,276     20,840   (2,171)    (1,352)
          Reliance Fresh has
                                 Reliance Hypermart                                    14,281      5,168     (677)      (425)
        highest share it sales   Reliance digital Retail                                2,408      4,119      (98)       (60)
             as well as losses   Reliance Dairy Foods                                   1,121      2,935      (62)       (42)
                                 Reliance Retail                                       59,848      2,907      (70)        182
                                 Reliance Trends                                        2,243      1,842      (21)       (14)
                                 Reliance Food Processing Solutions                     2,510      1,333     (557)      (349)
                                 Reliance Supply Chain Solutions                        2,784      1,315      (56)       (31)
                                 Strategic Manpower Solutions                             112      1,269      (17)         (7)
                                 Reliance Wellness                                        688      1,219     (175)      (114)
   Reliance operates ~1,000      Retail Concepts & Services (India)                       610      1,095      (46)       (18)
    retail stores in 14 states   Reliance Agri Products Distribution                      256        745      (82)       (52)
                   (85 cities)   Reliance Home Store                                      678        609     (136)       (90)
                                 Reliance Footprint                                       727        535      (47)       (28)
                                 Reliance Leisures                                        553        443      (68)       (52)
                                 Delight Proteins                                         195        328      (32)        (11)
                                 Reliance Digital Media                                    90        190       (7)         (5)
                                 Reliance Autozone                                        260        178      (18)       (12)
                                 Reliance Financial Distribution and Advisory Services    149         98       (2)       (15)
                                 Reliance Retail Insurance Broking                         31         63        18          25
       Reliance has invested     Reliance People Serve                                     23         56       (3)         (2)
       Rs52b of equity in its    Reliance Universal Ventures                              338         25       (1)           1
              retail ventures    Reliance Review Cinema                                    3.2        10       (2)         (1)
                                 Reliance Loyalty & Analytics                                5        10      (23)       (23)
                                 Reliance Lifestyle Holdings                            1,594          6      (78)       (50)
                                 Reliance Gems and Jewels                                 281          6      (80)       (42)
                                 Reliance Replay Gaming                                    1.4         6       (0)           -
                                 Reliance F&B Services                                     12          2       (3)         (3)
                                 Reliance Retail Securities and Broking Company            0.4         2       (2)         (2)
    Investments in retail had    Reliance Integrated Agri Solutions                       253          1      (22)       (22)
                                 Reliance Personal Electronics                             3.9         1       (3)         (3)
  slowed down substantially
                                 Reliance Retail Travel & Forex Services                     1         1       (0)         (0)
                     in FY10     Reliance Trade Services Centre                            0.3         1       (6)         (6)
                                 Reliance Retail Finance                                1,039          -       (4)         (1)
                                 Reliance Brands                                          378          -         -           -
                                 Reliance Vantage Retail                                1,076          -      (46)          22
                                 Reliance-GrandOptical Private                             0.5         -         -           -
                                 Reliance Universal Commercial                             45          -         -           -
                                 Reliance Global Commercial                                45          -         -           -
                                 Reliance Nutritional Food Processors                      12          -       (0)         (0)
                                 Total                                                112,927     47,357   (4,596)    (2,598)




3 June 2010                                                                                                                  6
                                                                                   Reliance Industries



              Valuation and view

              Our assumptions for RIL
              (1) We model average gas production of 70mmscmd for FY11 and 95mmscmd in FY12
                  (current at ~60mmscmd).
              (2) Well-head gas price of US$4.2/mmbtu.
              (3) GRM of US$7.6/8.5/bbl in FY11/FY12. (US$1/bbl change in RIL's GRM, changes
                  RIL's EPS by Rs5).

              KEY ASSUMPTIONS

              KEY METRICS                         FY07     FY08     FY09    FY10      FY11E    FY12E

              Exchange Rate (US$/bbl)             45.2     40.3     45.8    47.5       46.0     44.5
              Refining
              Capacity (mmt)                      33.0     33.0     33.0    62.0       62.0     62.0
              Production (mmt)                    31.7     31.8     32.0    60.9       60.8     60.8
              Capacity Utilization (%)            96.1     96.3     97.0    98.2       98.0     98.0
              GRM (US$/bbl)
              Blended (RIL & RPL)                 11.7     15.0     12.3     6.9        7.6      8.5
              Singapore GRM                        6.1      7.6      5.8     3.6        4.0      4.0
              Premuim to Singapore                 5.6      7.3      6.5     3.3        3.6      4.5
              E&P
              Gas Production (mmscmd)                                       39.8       70.0     95.0
              Oil Production (kbd)                                          10.7       35.0     35.0
              Pricing
              Brent Oil (US$/bbl)                 64.5     82.8     85.0    69.0      70.0     70.0
              Wellhead Gas Price (US$/mmbtu)                                 4.2       4.2      4.2
                                                                              Source: Company / MOSL


              Our SOTP value at Rs1,133
              We value RIL on SOTP basis to arrive at a price target of Rs1,133 (incl E&P upside
              potential of Rs205/share). Adjusted for treasury shares, RIL trades at 11.7x FY12E EPS
              of Rs87.9. Maintain Buy.




3 June 2010                                                                                            7
                                                                                                                Reliance Industries



RELIANCE: SUM OF PARTS VALUATION

BUSINESS                             US$ B     RS B   RS/SH   COMMENTS

Core business:                         39.5   1,817    610
Refining                               20.2     929    312    Core business EV @7x FY12E EBITDA
Petchem and Others                     19.3     888    298    EV @7x FY12E EBITDA (includes PMT)
E&P Initiatives                        23.0   1,056    355    Includes KG-D6, NEC-25, CBM, KG-III-6 and Yemen block
KG - D6 Gas (KG Basin)                 13.6     624    210    DCF; 90% stake; Plateau of 120 MMSCMD; 23 TCF recovery
KG - D6 MA1 Oil (KG Basin)              1.9      85     29    DCF; 90% stake; 95 mmbbls recovery; (LT Brent - $70/bbl)
NEC - 25 (Mahanadi basin)               2.0      90     30    DCF; 90% stake; reserves of 3.7 TCF, prodn likely in in 2012-13
Sohagpur East & West (CBM blocks)       1.0      48     16    DCF; 100% stake; OGIP of 3.65 TCF, assumed 50% recovery,
                                                              production to commence in FY12-13
KG - III - 6 oil (KG Basin)             0.8     37      12    Reserve size yet to be assessed. Value based on market news on
                                                              reserves at 1b bbls, @US$2/bbl
Block - 9 (Yemen)                       0.8     38      13    Currently producing. 2P reserves of 332 mmbbls valued, assumed
                                                              50% recovery valued at @US$20/bbl; RIL stake 25%
Shale Gas JV                            2.9     134     45    Average of DCF and peer multiple
Investments                             2.8      92     31
  Investments in RGTIL                  0.4      20      7    Investments of Rs20b
  Investments in RIIL                   0.1       4      1    45% stake valued at CMP
  Investments in fuel Retailing         1.7      40     13    At estimated book value
  Investment in SEZ                     0.6      28      9    At book value
Reliance Retail                         2.2     100     34    100% subsidiary of RIL, valued at total investments
Less: Net Debt                          6.6     304    102
Total Base Value                         61   2,762    928    Based on fully diluted equity of 2,977m (excl 309m treasury shares)
Potential Upside                         13     612    205    E & P Upside Potential
E&P
  KG-D6 Gas - additional prospects      7.2    332     112    DCF based, indicated 50TCF potential in NFDP. Potential upside
                                                              recovery of 11TCF assuming 70% recovery.
  KG-D6 oil - additional prospects      1.4     65      22    DCF based, identified prospect of 1.6b bbls, Base case has only 6%
                                                              recovery. Assumed additional 4% recovery
  Sonhat, Barmer 1and 2 (CBM Blocks) 1.3        61      21     Based on 8TCF reserve size - data from DGH projections on potential
                                                              resources & RIL OGIP of 1.5TCF for Sonhat (@US$1/BOE or
                                                              US$0.17/MCF)
  NEC - 25 (Mahanadi basin)             0.7     31      10    Upside potential of 2TCF (2P) (@US$2/BOE or US$ 0.25/MCF)
  KG-DWN-2001/1 (D9)                    1.6     76      25    Risked prospective resources of 1.1bboe as per Hardy; RIL stake 90%,
                                                              valued at US$1.8/boe
  KG-DWN-2003/1 (D3)                    1.0     47      16    Risked prospective resources of 645mmboe as per Hardy; RIL stake
                                                              90%, valued at US$1.8/boe
  MN-DWN-2003/1 (D4 Block)               0       0       0    As per Niko (15%) partner, this block has very similar geological system
                                                              as KG-D6 and could be potentially larger than KG-D6 or NEC-25; we
                                                              currently do not ascribe any value now as exploratory drilling yet to
                                                              commence
  CY-DWN-2001/2 (Cauvery Basin)          0       0       0    Most recent discovery in Cauvery deep water; Potentially a large find
                                                              based on large gas and oil flow rate from test well; Further exploratory
                                                              drilling continuing; we do not ascribe any value as reserve/resource
                                                              estimate yet to be announced
  KG-OSN-2001/1 (KG Basin)               0       0       0    Gas discovery in Sep 2006; Commerciality under evaluation; we do not
                                                              ascribe any value
  GS-OSN-2000/1 (Gujarat Saurashtra)     0       0       0    Gas discovery in May 2007; RIL's first discovery in large potential
                                                              carbonate reservoirs; Commerciality under review
  SEZ                                    0        0       0   We await more clarity on RIL's SEZ plans
Total incl upside potential             74    3,374   1,133
                                                                                                                        Source: MOSL




3 June 2010                                                                                                                         8
                           Reliance Industries



Financials and Valuation




3 June 2010                                 9
                                                                                                                                                  Reliance Industries




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       Disclosure of Interest Statement                    Reliance Industries
       1. Analyst ownership of the stock                           No
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