Reliance Group (formerly Reliance ADAG) is committed to reduce its debt, and is hopeful of getting a banking licence, its Chairman Anil Ambani told shareholders of his group companies on Tuesday.
The Reliance Group had a debt of Rs.1,13,543 crore as on March 30, 2013, according to a Credit Suisse report.
Addressing back-to-back annual meetings, Mr. Ambani said Reliance Communication (RCom) would remain free cash-flow-positive and the company would utilise all surpluses to reduce its debt.
He said the company’s foreign exchange debt servicing obligations would be fully covered by its Reliance Globalcom’s foreign exchange earnings.
He said the proposed monetisation of real estate through demerger of properties would contribute to a further reduction of debt.
Mr. Ambani said despite the challenging environment, Reliance Power had been executing projects as per schedule and operating capacity had been doubled from 1,200 MW to 2,545 MW. He said the operating capacity would go up over 5,000 MW in 12 months.
The 40 MW solar plant in Rajasthan generated 60 million units in the first year of operations. “Reliance Power is set to emerge as the largest clean and green power and resources company,” Mr. Ambani said.
Expressing confidence that his group would get a banking licence, he said banking would be a long-term growth opportunity for Reliance Capital (RCap).
“RCap’s consolidated debt would come down from Rs.20,000 crore to Rs.5,000 crore upon transfer of commercial finance business to the proposed bank,” Mr. Ambani said.
“Reliance Capital is adequately capitalised to fund the proposed bank and the company would list the proposed bank in three years,” he added.
Mr. Ambani said all of Reliance Infrastructure’s (RInfra) projects would be revenue operational within this financial year and the company would capitalise on its strongest balance-sheet in the sector to pursue growth opportunities.