SUBMITTED TO, SUBMITTED

N.L AHUJA SIR BY,

GROUP 4
1. Subharaj
2. Isha
3. Vishal
4.Pradip
5.Ankit
6.Dhawal
 INTRODUCTION

Reliance Communications (NSE: RCOM, BSE: 532712), formerly known as Reliance Infocomm,
along with Reliance Telecom and Flag Telecom, is part of Reliance Communications Ventures
(RCoVL). Reliance Communications Limited, founded by Dhirubhai H Ambani (1932–2002), is the
flagship company of the Reliance Anil Dhirubhai Ambani Group. The Reliance Anil Dhirubhai Ambani
Group currently has a net worth in excess of 64,000 crore (US$13.6 billion), cash flows of 13,000
crore ($2.8 billion), and a net profit of 8,400 crore ($1.8 billion). TheEquity Shares of RCOM are
listed on Bombay Stock Exchange Limited and National Stock Exchange Limited. TheGlobal
Depository Receipts and Foreign Currency Convertible Bonds are listed on Luxembourg Stock
Exchange andSingapore Stock Exchange respectively.
.
Background
It ranks among the top 5 telecommunications companies in the world by number of customers in a
single country. Reliance Communications corporate clientele includes 2,100 Indian and multinational
corporations, and over 800 global, regional and domestic carriers. The company has established a pan-
India, next-generation, integrated (wireless and wireline), convergent (voice, data and video) digital
network that is capable of supporting services spanning the entire communications value chain,
covering over 24,000 towns and 600,000 villages. Reliance Communications owns and operates the
next-generation IP-enabled connectivity infrastructure,comprising over 190,000 kilometers of fiber
optic cable systems in India, USA, Europe, Middle East and the Asia Pacific region.

Main subsidiaries

Reliance Telecommunication Limited (RTL)

In July 2007, the company announced it was buying US-based managed ethernet and application
delivery services company Yipes Enterprise Services for a cash amount of 1200 crore (the
equivalent of US$300 million). The deal was announced of the overseas acquisition, the Reliance group
has amalgamated the United States-based Flag Telecom for $210 million (roughly 950 crore). RTL
operates in Madhya Pradesh, West Bengal, Himachal Pradesh, Orissa, Bihar, Assam, Kolkata and
Northeast, offering GSM services.[3]

Reliance Globalcom

RGL owns the worlds largest private undersea cable system,spanning 65,000 km seamlessly integrated
with Reliance Communications. Over 110,000 km of domestic optic fiber provides a robust Global
Service Delivery Platform, connecting 40 key business markets in India, the Middle East, Asia, Europe,
and the U.S.

Reliance Internet Data Center (RIDC)

RIDC provides Internet Data Center (IDC) services located in Mumbai, Bangalore, Hyderabad and
Chennai. Spread across 650,000 sq ft (60,000 m2) of hosting space, it offers IT infrastructure
management services to large, medium and small enterprises. It is one of the leading data center service
provider in India and provides services likecolocation, managed server hosting, virtual private server
and data security. It has launched cloud computing services, offering product under its infrastructure as
a server (Iaas) and software as a service (Saas) portfolio, which enables enterprises, mainly small and
medium, a cost-effective IT infrastructure and application on pay-per-user model.

Reliance Big TV Limited

Reliance Big Tv launched in August 2008 and thereafter acquired 1 million subscribers within 90 days
of launch, the fastest ramp-up ever achieved by any DTH operator in the world. Reliance Big TV offers
its 1.7 million customers DVD-quality pictures on over 200 channels using MPEG-4 technology.

Reliance Infratel Limited (RITL)

RITL’s business is to build, own and operate telecommunication towers, optic fiber cable assets and
related assets at designated sites, and to provide these passive telecommunication infrastructure assets
on a shared basis to wireless service providers and other communications service providers under long-
term contracts.

Acquisition

FLAG Telecom
Yipes ethernet service
Digicable

Offices
Reliance Communications Limited has its offices in Ahmedabad, Bangalore, Bhopal, Chandigarh,
Chennai, Hyderabad, Jaipur, Kochi, Kolkata, Lucknow, Patna and Pune.

Reliance – Anil Dhirubhai Ambani Group, an offshoot of the Reliance Group founded by Shri
Dhirubhai H Ambani (1932-2002), ranks among India’s top three private sector business houses in
terms of net worth. The group has business interests that range from telecommunications (Reliance
Communications Limited) to financial services (Reliance Capital Ltd) and the generation and
distribution of power (Reliance Infrastructure Limited).
Reliance – ADA Group’s flagship company, Reliance Communications, is India's largest private sector
information and communications company, with over 100 million subscribers. It has established a pan-
India, high-capacity, integrated (wireless and wireline), convergent (voice, data and video) digital
network, to offer services spanning the entire infocomm value chain.
Other major group companies — Reliance Capital and Reliance Infrastructure — are widely
acknowledged as the market leaders in their respective areas of operation
Vision:
• By 2015, be amongst the top 3 most valued Indian companies,
• providing Information, Communication & Entertainment services, and being the industry
benchmark in
• Customer Experience, Employee Centricity and Innovation

Mission:
We will create world-class benchmarks by:
• Meeting and exceeding Customer expectations with a segmented approach
• Establishing, re-engineering and automating Processes to make them customer centric,
efficient and effective
 • Incessant offering of Products and Services that are value for money and excite customers
• Providing a Network experience that is best in the industry
• Building Reliance into an iconic Brand which is benchmarked by others and leads industry in
Intention to Purchase and Loyalty
• Developing a professional Leadership team that inspires, nurtures talent and propagates
RCOM Values by personal examples.

INTERNATIONAL SOURCES OF FUNDS:

• Reliance Communications Limited has informed the Exchange regarding a press release dated March 17, 2011,
titled "Reliance Communications draws down first tranche of Rs. 3,000 crore (US$ 665 Million) from China
Development Bank underwritten facility of Rs. 8,700 crore (US$ 1.93 Billion)" .
• Reliance Communications Ltd has informed BSE regarding a Media Release dated December 15, 2010
titled "Reliance Communications signs MoU with China Development Bank Corporation for 10 year
Financing of US$ 1.93 Billion (Rs. 9,000 crore)

Reliance Comm- Credit Rating

Reliance Communications Ltd has informed BSE that ICRA Limited has retained the Long Term rating of Reliance
Communications Limited at LAA+ level and placed under watch with negative implications and reaffirmed its rating of A1+ for
Short-Term Fund Based / Non Fund Based Limits.

KEY FINALCIAL RATIO:

Particular 201003 200903 200803 200703 200512

Liquidity Ratios
Debt/Equity Ratio 0.54 0.67 0.77 0.41 0.00
Current Ratio 2.45 2.14 1.76 2.05 5.13
Turnover Ratios
Inventory Turnover Ratio 49.16 66.41 98.70 207.19 0.00
Fixed Assets Turnover Ratio 0.35 0.51 0.70 0.98 0.00
Debtors Turnover Ratio 8.42 11.72 15.61 25.45 0.00
Interest Coverage Ratios 1.56 5.65 3.99 6.30 0.00
Profitability Ratios
Operating Profit Margin 23.93 51.60 35.95 36.95 0.00
PAT/Total Income 2.99 24.84 13.97 10.82 42.61
NPM (Net Profit Margin) 3.53 31.83 17.49 18.88 0.00
Return on Capital Employed 2.20 9.16 8.66 9.23 0.16
Return on Networth 0.94 12.55 11.40 10.92 0.10
Balance sheet
Mar ' 10 Mar ' 09 Mar ' 08 Mar ' 07 Dec ' 05
Sources of funds
Owner's fund
Equity share capital 1,032.01 1,032.01 1,032.01 1,022.31 0.05
Share application money - - - - 611.57
Preference share capital - - - - -
Reserves & surplus 49,466.88 50,658.31 23,808.02 19,503.23 14,783.43
Loan funds
Secured loans 3,000.00 3,000.00 950.00 5,113.57 -
Unsecured loans 21,478.28 27,903.61 19,336.43 9,454.27 -
Total 74,977.17 82,593.93 45,126.46 35,093.38 15,395.04
Uses of funds
Fixed assets
Gross block 39,838.17 37,941.15 21,576.32 20,625.82 198.09
Less : revaluation reserve - - - - -
Less : accumulated depreciation 9,225.69 6,533.38 4,688.69 2,527.37 31.85
Net block 30,612.48 31,407.77 16,887.63 18,098.45 166.24
Capital work-in-progress 1,683.52 3,643.86 7,117.56 2,185.60 -
Investments 31,898.60 31,364.75 13,844.14 5,434.43 12,074.10
Net current assets
Current assets, loans & advances 20,005.94 25,543.01 18,515.29 20,107.04 3,158.96
Less : current liabilities & provisions 9,223.37 9,365.46 11,238.16 10,732.14 4.25
Total net current assets 10,782.57 16,177.55 7,277.13 9,374.90 3,154.70
Miscellaneous expenses not written - - - - -
Total 74,977.17 82,593.93 45,126.46 35,093.38 15,395.04
Notes:
Book value of unquoted investments 31,898.31 31,364.63 13,844.14 5,434.43 12,074.10
Market value of quoted investments 0.29 0.12 - - -
Contingent liabilities 3,274.83 6,555.82 4,392.73 3,781.30 -
Number of equity sharesoutstanding (Lacs) 20640.27 20640.27 20640.27 20446.15 1.00
Profit loss account
Mar ' 10 Mar ' 09 Mar ' 08 Mar ' 07 Dec ' 05
Income
Operating income 13,554.60 15,086.66 14,792.05 12,756.30 -
Expenses
Material consumed 50.39 29.95 15.15 16.48 -
Manufacturing expenses 7,994.76 5,975.57 4,144.21 3,358.34 -
Personnel expenses 672.39 754.56 858.65 684.40 1.11
Selling expenses 662.96 773.21 1,067.76 1,399.88 -
Adminstrative expenses 1,980.67 2,323.44 2,532.99 1,784.19 0.55
Expenses capitalised - - - - -
Cost of sales 11,361.17 9,856.73 8,618.76 7,243.29 1.66
Operating profit 2,193.43 5,229.93 6,173.29 5,513.01 -
Other recurring income 797.98 675.12 28.68 169.61 13.26
Adjusted PBDIT 2,991.41 5,905.05 6,201.97 5,682.62 11.59
Financial expenses 1,253.84 1,153.24 870.05 456.55 -
Depreciation 1,511.24 1,933.51 1,843.66 1,836.12 2.74
Other write offs - - - - -
Adjusted PBT 226.33 2,818.30 3,488.26 3,389.95 8.86
Tax charges 1,404.59 1,488.64 1,393.66 1,043.38 3.20
Adjusted PAT -1,178.26 1,329.66 2,094.60 2,346.57 5.65
Non recurring items 1,657.19 3,473.01 491.85 62.28 -
Other non cash adjustments - - - - -
Reported net profit 478.93 4,802.67 2,586.45 2,408.85 5.65
Earnigs before appropriation 981.68 9,102.91 4,881.35 2,414.50 5.65
Equity dividend 175.44 165.12 154.80 102.23 -
Preference dividend - - - - -
Dividend tax 29.14 28.06 26.31 17.37 -
Retained earnings 777.10 8,909.73 4,700.24 2,294.90 5.65
COMPANY'S FINANCIALS INFORMATION

(i) The Company issued FCCBs in two tranches; 5,00,000 FCCBs for 5 Years, 4.65%, USD 500 million
issued on 9th May, 2006 and 10,000 FCCBs for 5 Years, 4.95%, USD 1000 million issued on
28th February, 2007. Pursuant to the exercise of an option by the FCCB Holders and in
accordance with the terms and conditions thereof, the Company, during an earlier year, allotted
1,87,44,801 fully paid Equity Shares of Rs. 5 each at a pre determined premium of Rs. 475.68
per share against 2,03,051 FCCBs and 6,67,090 fully paid Equity Shares of Rs. 5 each at a pre
determined premium of Rs.656.23 per share against 100 FCCBs respectively.
(ii) During the year, the Company has bought back and cancelled 297 nos. (Previous year 350 nos.) of 5
Year, 4.95%, FCCBs of the face value of USD 1,00,000 each, as per approval of the Reserve
Bank of India, at a discount to the face value. This has resulted in a saving of Rs. 24.49 crore
(Previous year Rs. 79.61 crore) which has been reflected as part of Other Income. Consequent
upon such buy back and cancellation, the Company’s obligations to convert the said Bonds into
Shares, if so claimed by the Bond Holders and/ or to redeem the same in foreign currency, has
come to an end vis-à-vis the cancelled Bonds. Rs. 14.48 crore (Previous year Rs. 7.68 crore)
being provision for premium on redemption relatable to such cancelled Bonds has been reversed
on buyback and cancellation of FCCBs. Out of total FCCBs issued, 2,96,949 (Previous year
2,96,949) FCCBs and 9,253 (Previous year 9,550) FCCBs from the respective tranches were
outstanding as on 31st March, 2010.
(iii) In the event, these outstanding FCCBs are fully converted into Equity Shares, the Equity Share
Capital of the Company would increase by approximately 8.91 crore (Previous year 9.11 crore)
Equity Shares of Rs. 5 each.
(iv) In case of the above mentioned FCCBs, on and at anytime after 9th May, 2009 and 28th February,
2010 respectively, on and prior to the maturity date, the Company may, subject to certain terms
and conditions as per the offering memorandum, redeem the FCCBs in whole and not in part at
their Early Redemption amount, provided that no such redemption may be made unless the
aggregate value (as defined in the terms and conditions) on each trading day during the
period of not less than 30 consecutive trading days, ending not earlier than 14 days prior to the
date upon which notice of such redemption is given, was at least 130 percent of the Early
Redemption amount.
(v) FCCBs amount includes Rs. 942.32 crore (Previous year Rs. 733.62 crore), being the premium on
redemption of FCCBs computed on pro rata basis for the period up to 31st March, 2010.
3 Foreign Exchangen
In accordance with an amendment to Schedule VI of the Companies Act, 1956 (“the Act”) and
in line with the Accounting Standard (“AS”) 11, “The Effect of Changes in Foreign Exchange
Rates”, the Company continues the policy of accounting for the changes in the amounts of
loans/ liabilities relating to Fixed Assets, consequent to changes in foreign exchange rates, as
profit or loss of the Company for the year in which the changes take place without adjusting the
amount of the change in the cost of fixed assets.The net gain of Rs. 1,572.16 crore (Previous
year Rs. 119.57 crore) including gain of Rs. 21.98 crore (Previous year Rs. 32.76 crore)
on account of conversion of overseas bank balances and Rs. 2,126.92 crore relating to loans
liabilities (Previous year foreign exchange loss of Rs. 4,464.57 crore relating to loans/ liabilities
which was debited to Profit and Loss Account and withdrawn from the General Reserve of the
Company in accordance with the terms of the Schemes of Arrangement, leaving no impact vis-
à-vis profit of the year ended 31st March, 2009) have been reflected in “Financial Charges
(net)” as the effect of Foreign Currency Exchange Fluctuation in Profit and Loss Account.
During the year, loss of Rs. Nil (Previous year Rs. 139.03 crore) arising out of marking related
Derivative Contracts to market has also been recognised in the Profit and Loss Account, in
 compliance with the announcement dated 29th March, 2008 by The Institute of Chartered
Accountants of India (ICAI) regarding Accounting for Derivatives. As a measure of prudence,
the Company has decided that, unlike in earlier years, not to recognise any mark to market gains
in respect of any outstanding class of derivative contracts related to loans, liabilities and assets
expressed in foreign currency. Accordingly, the Company has not recognised gain of Rs. 34.30
crore on mark-to-market valuation of derivative contracts outstanding as at the end of the year.
If the Company had not made this change of policy, net profit after tax would have been higher
by an amount of Rs. 34.30 crore for the year.4 Schemes of Amalgamation and Arrangement of
earlier yearsThe Company, during the past years, undertook various Schemes including
restructuring of ownership structure of telecom
business so as to align the interest of the shareholders. Accordingly, pursuant to the Schemes of
Amalgamation and Arrangement (“the Schemes”) under Sections 391 to 394 of the Companies
Act, 1956 approved by the Hon’ble High Court of respective judicature, the Company, during
the respective years, recorded all necessary accounting effects, along with requisite disclosure in
the notes to the accounts, in accordance with the provisions of the said Schemes. The
cumulative effects of the Schemes 68 Reliance Communications Limited in case of Equity
Share Capital of the Company have been disclosed below the respective Schedule to the
Accounts. Reserves,
pursuant to the said Schemes, include:
(i) Rs. 9,171.93 crore, being Securities Premium Account, which was part of the Security Premium of
erstwhile Reliance Infocomm Limited (RIC), the transferor company.
(ii) General Reserve I of Rs. 5,538.00 crore representing the unadjusted balance being the excess of
assets over liabilities relatable to Telecommunications Undertaking transferred and vested into
the Company.
(iii) General Reserve II of Rs. 2,785.21 crore representing the unadjusted balance of the excess of
assets over liabilities received by the Company relatable to Telecommunications Undertaking
transferred and vested into the Company.
(iv) During the year, General Reserve III and General Reserve IV representing opening balances of Rs.
4,335.43 crore and Rs. 27,030.86 crore respectively have been combined as General Reserve
III. General Reserve III includes an amount of Rs. 25,854.38 crore (Previous year Rs.
27,030.86 core) pursuant to transfer of assets and liabilities and write off of investment of Rs.
2,096.43 crore, in accordance with the Scheme, for cancellation of investment in erstwhile
Reliance Gateway Net Limited (RGNL) and net effect on fair valuation of assets and liabilities
of the Company of Rs. 12,698.18 crore.
(v) Reserve for Business Restructuring of Rs. 1,287.10 crore representing the unadjusted balance of
revaluation of investment in Reliance Communications Infrastructure Limited, the holding
company of Reliance Infratel Limited (RITL) after withdrawing an amount equivalent to
writing off of Passive Infrastructure assets, transferred to RITL, to the Profit and Loss Account.
Balance in Reserve for Business Restructuring shall be available to meet the increased
depreciation, costs, expenses and losses, including on account of impairment of or write down
of assets etc.
(vi) Additional depreciation arising on fair value of the assets has been adjusted from Provision for
Business Restructuring.
(vii) The Company incorporated the effects of the Scheme, for demerger of Optic Fiber Undertaking
into Reliance Infratel Limited, in the accounts of the previous year ended 31st March, 2009,
then pending the filing of the Order of the Hon’ble High Court, sanctioning the Scheme, with
the Registrar of Companies (RoC) as required by Section 394 (3) of the Companies Act, 1956.
The said Order was filed with RoC on 15th September, 2009. Consequently, the Scheme had
become effective.
5 Depreciation on Electronic EquipmentsDuring the year, the Company carried out technical/
technology assessment to determine the useful life of some of its telecommunication
equipments. The useful life of such telecommunication equipments has been re-assessed and
ascertained as 18 years, impacting the provision for depreciation of these assets for the year
ended on 31st March, 2010. As a result, depreciation charge is lower and profits for the year are
higher by Rs. 771.00 crore for the year. The accounting treatment so determined is fully in
accordance with the applicable provisions of the Companies Act, 1956.
6 Provisions
(i) Provisions include, provision for disputed claims of verification of customers Rs. 9.04 crore
(Previous year Rs.9.04 crore) and others of Rs. 1,650.88 crore (Previous year Rs. 1,835.76
crore) and Provision for Commission to Non Executive Directors of Rs. 0.60 crore
(Previous year Rs. 0.60 crore).
(ii) During the year, an amount of Rs. 140.00 crore (Previous year Rs. Nil) relating to Roll out
obligations, Rs. Nil (Previous year Rs. 4.40 crore) relating to commission to Non Executive
Directors and Rs. 50.52 crore (Previous year Rs. Nil) relating to disputed liablities have been
reversed. An amount of Rs. 5.64 crore (Previous year Rs. Nil) has been provided towards
disputed interconnect usage charges and an amount of Rs. Nil (Previous year Rs. 31.18 crore)
has been reversed out of disputed interconnect usage charges. An amount of Rs. Nil (Previous
year Rs. 29.22 crore), was paid towards disputed liablities and an amount of Rs. 0.60 crore
(Previous year Rs. 30.60 crore) was paid towards commission to Non Executive Directors.
(iii) On determination by the Board of Directors, the liability against provision for commission
to Non Exucutive Directors will be paid during the year 2010-11.
(iv) Also refer Note 2 (v) above.
The aforesaid provisions shall be utilised on settlement of the claims, if any, there against.

PRESS RELEASE OF RELIANCE COMMUNICATIONS

• Reliance Communications Limited has informed the Exchange that the Registrar and Transfer Agent of
the Company - M/s. Karvy Computershare Private Limited, have shifted their office to the following new
address : Karvy Computershare Private Limited, Unit : Reliance Power Limited, Madhura Estates,
Municipal No. 1-9/13/C, Plot No. 13 & 13C, Survey No. 74 & 75, Madhapur Village, Hyderabad - 500 081.
• Reliance Communications Ltd - Fixes Book Closure for Dividend & AGM
Reliance Communications Ltd has informed BSE that the Register of Members & Share Transfer Books of
the Company will remain closed from September 15, 2010 to September 28, 2010 (both days inclusive)
for the purpose of Payment of Dividend & 6th Annual General Meeting (AGM) of the Company.
• Reliance Communications Limited has informed the Exchange that the Company has fixed the book
closure from September 15, 2010 to September 28, 2010 (both days inclusive) for the purpose of Annual
General Meeting and payment of dividend, if approved at the ensuing Annual General Meeting of the
members of the Company.
• Reliance Communications Ltd has informed BSE that ICRA Ltd has retained the Long Term rating of
Reliance Communications Ltd. at LAA+ level but assigned negative outlook to the rating and reaffirmed
its Short-Term rating at A1+.
• Reliance Communications Ltd - Reliance Communications signs MoU with China Development Bank
Corporation
Reliance Communications Ltd has informed BSE regarding a Media Release dated December 15, 2010
titled "Reliance Communications signs MoU with China Development Bank Corporation for 10 year
Financing of US$ 1.93 Billion (Rs. 9,000 crore)"

SUGGESTION
 · Reliance should Increase Network coverage in Indore of
high Speed Data Card.
· Some of area does not have Reliance high speed data
card Network like :
Annapurna mandir , Airodrum , Sudama Nagar ,
Rajendra Nagar, Tower square area and some
other areas .These area Covered ¼ Population of
Indore. Reliance should try to cover all these
area to target maximum customer.
· Reliance should improve Service given to the customer.
· There should be a unlimited plan.
· Try to make long relationship with customer.
· High speed data card is also available in market in
comparatively low price then available at
reliance world store, this price fluctuation
should be removed.

CONCLUTION:
We can conlude that the company was successful in raising
fund from the international as well as from equity and debt
and hybrid financing. Reliance-communications-ltd is in 2st
position having large number of customers & providing good
services to them. The company has a wide customer base, so
it should concentrate on this to retain these customers.

RESOURCES:

• http://www.moneycontrol.com/stocks/stock_market/corp_notices.php?autono=415418
• http://money.rediff.com/companies/reliance-communications-ltd/15200050/balance-sheet
• http://money.sulekha.com/reliance-communications_key-financial-ratios
• http://www.rcom.co.in/Rcom/aboutus/ir/pdf/Final_RCOM_AR-2009-10_Full.pdf
• http://www.rcom.co.in/Rcom/aboutus/ir/pdf/3Q_FY11_Earnings_Call_Transcript.pdf
• http://profit.ndtv.com/company/notices/reliance-communications-ltd