Helped by a huge cash pile of over Rs 70,000 crore, corporate giant Reliance Industries has become a debt-free entity — a feat its billionaire chief Ms Mukesh Ambani had promised to achieve about 10 months ago.
At the end of last financial year ended March 31, 2012, Reliance Industries Ltd (RIL) had total cash balance of Rs 70,252 crore ($13.8 billion) against an outstanding debt of Rs 68,259 crore ($13.4 billion) — making the country’s most valued firm debt free on a net cash basis.
RIL’s outstanding debt rose marginally by about 1 per cent during last fiscal, but the surge in its cash position was much larger at about 66 per cent during this period.
As on March 31, 2011, RIL had outstanding debt of Rs 67,397 crore against a cash balance of Rs 42,393 crore.
Mr Ambani, Chairman and Managing Director, had told RIL’s shareholders at its annual general meeting on June 3, 2011, that the company would become debt-free during 2011-12.
“Reliance will be completely debt-free, net of cash balances within this year,” he had said at that time.
Meeting the target, RIL’s full-year financial results for the fiscal ended March 31, 2012 showed that the company has become “debt free on a net basis as compared to the gearing level of 13.5 per cent as on March 31, 2011.”
The company said that it has primarily invested its cash in fixed deposits, certificate of deposits with banks, mutual funds and Government securities or bonds.