RIL AGM 2011: Mukesh says company will be debt free this fiscal

Reliance chairman Mukesh Ambani addressing thecompany's annual general body meeting(AGM) said the energy-to-retailconglomerate will be free of debt by March next year, using cash earned fromselling stake in oil and gas fields to UK's BP Plc, on whom it is also pinninghopes for reviving sagging natural gas output at KG-D6 fields.

He added India's largest listed firm plansto raise plastic manufacturing capacity and invest aggressively in its retailbusiness by launching cash-and-carry, or wholesale, outlets.

On the company's broadband foray, he saidReliance was conceptualising its foray into broadband wireless services but didnot live up to the market expectation of unfolding blueprint for entry intofinancial services and giving guidance on when the falling output at itscrown-jewel eastern offshore KG-D6 fields will be arrested.

Ambani said BP will acquire "30 percent participating interest in (Reliance's) 23 oil and gas blocks, includingthe currently producing KG-D6 block" for $7.2 billion (Rs 32,400 crore).

The transaction, plus about Rs 30,000 crorein cash flows that the company generates mostly from oil refining and gasbusiness would help Reliance become debt free.

"Reliance will be completely debtfree, net of cash balances within this year," he announced.

It had an outstanding debt of Rs 67,397crore as on March 31, 2011 and cash and cash equivalent of Rs 42,393 crore.

Ambani said after government approval,Reliance and BP will "jointly assess" problems the KG-D6 fields thathave seen output dip to about 48-49 million cubic metres per day from 61.5mmcmd instead of rising to planned 69 mmcmd.