RIL to invest $18 bn to double operating profit: Mukesh Ambani tells shareholders

Reliance Industries (RIL), the Mukesh Ambani-led energy giant, plans to invest $18 billion across its businesses in India to double its operating profit over the next four to five years.

The conglomerate reported its second consecutive quarterly drop in profit during the three months ended March 31, even as its shares are near a three-year low, and its rising cash pile has fuelled investor disquiet.

Chairman Mukesh Ambani told shareholders at the company's annual general meeting on Thursday that RIL aims to increase revenue from retail business by as much as six times in 3-4 years and is targeting a ten-fold increase in sales from its shale gas business in the US.



Battling a sharp dip in output at its showpiece KG-D6 gas fields, RIL will invest over $12 billion in the refining and petrochemical industries and has drawn plans to double natural gas output from its flagging fields to 60 million cubic meters a day (mscmd) on a "sustained" basis.

"I have set myself the target to double the operating profit of your company in about five years," Ambani said.

Operating profit fell 9 per cent to Rs 22,225 crore in the year ended March 31, the first decline since 2003. Standalone net profit was down to Rs 20,040 crore in 2011-12 from Rs 20,286 crore a year earlier.

"We are now ready for the next period of growth at Reliance by investing across all our core businesses in new capacity and margin improvement projects," Ambani told the company's annual general meeting.

The firm will "invest nearly Rs 1 lakh crore over the next five years to build a stronger and more diversified Reliance," he said.

Ambani, the richest Indian, said high rates of inflation, adverse foreign exchange rate movements, continuing fuel subsidies and slowdown in rate of economic growth has had an impact on doing business in the country.

With inputs from agencies