Reliance Capital Limited

Transcription

1 Reliance Capital Limited Review reprt n the results fr the financial year ended March 31, 2012 (Audited) May 19, 2012 Review reprt fr year ended March 31,

2 Safe Harbr This reprt and the discussin that fllws may cntain frward lking statements by Reliance Capital Limited ( RCL ) that are nt histrical in nature. These frward lking statements, which may include statements relating t future results f peratin, financial cnditin, business prspects, plans and bjectives, are based n the current beliefs, assumptins, expectatins, estimates, and prjectins f the directrs and management f RCL abut the business, industry and markets in which RCL perates. These statements are nt guarantees f future perfrmance, and are subject t knwn and unknwn risks, uncertainties, and ther factrs, sme f which are beynd RCL s cntrl and difficult t predict, that culd cause actual results, perfrmance r achievements t differ materially frm thse in the frward lking statements. Such statements are nt, and shuld nt be cnstrued, as a representatin as t future perfrmance r achievements f RCL. In particular, such statements shuld nt be regarded as a prjectin f future perfrmance f RCL. It shuld be nted that the actual perfrmance r achievements f RCL may vary significantly frm such statements. General Risk Investment in equity and equity related securities invlve a degree f risk and investrs shuld nt invest any funds in this Cmpany unless they can affrd t take the risk f lsing their investment. Fr taking an investment decisin, investrs must rely n their wn examinatin f RCL including the risks invlved. Cnvenience translatin We publish ur financial statements in Indian Rupees. All references herein t Indian Rupees and Rs. are t Indian Rupees and all references herein t US dllars and US$ are t United States dllars. All translatins frm Indian Rupees t United States dllars were made (unless therwise indicated) using the rate f Rs = US$ 1.00 fr Q4FY12 prfit and lss items (Rs = US$ 1.00 fr FY12 prfit and lss items) and the rate f Rs = US$ 1.00 fr balance sheet items as n March 31, All amunts translated int United States dllars as described abve are prvided slely fr the cnvenience f the reader, and n representatin is made that the Indian Rupees r United States dllar amunts referred t herein culd have been r culd be cnverted int United States dllars r Indian Rupees respectively, as the case may be, at any particular rate, the abve rates r at all. Any discrepancies in any table between ttals and sums f the amunts listed are due t runding ff. We als use the internatinal cnventin f presenting financial infrmatin in millins r billins f rupees. Nte: One millin rupees is equal t ten lakh rupees. Ten millin rupees is equal t ne crre rupees. One billin rupees is equal t ne hundred crre rupees. Review reprt fr year ended March 31,

3 Table f cntents Sectin 1 - Reliance Capital at a glance Sectin 2 - An verview Sectin 3 - Financial and perating highlights Sectin 4 - Stck market highlights Review reprt fr year ended March 31,

4 SECTION 1 RELIANCE CAPITAL - PERFORMANCE AT A GLANCE (Rs. Millin) Particulars Reliance Capital Limited (Cnslidated) Ttal Revenues 61,406 55,359 66,269 Prfit After Tax 4,345 2,912 4,578 Net wrth 77,125 78, ,963 Ttal Assets 254, , ,436 Reliance Capital Asset Management (Cnslidated) Ttal Revenues 6,817 7,330 6,647 Prfit Befre Tax 2,680 2,943 3,076 Reliance Life Insurance Ttal Premium (Net) 65,883 65,479 54,702 Prfit Befre Tax/(Lss) (2,838) (1,293) 3,726 Reliance Cmmercial Finance Ttal Revenues 13,252 13,741 19,450 Prfit Befre Tax ,693 2,537 Brking & Distributin businesses Ttal Revenues 2,585 3,109 4,661 Prfit Befre Tax Reliance General Insurance Grss Written Premium 19,797 16,554 17,125 Prfit Befre Tax/(Lss) (905) (3,098) (3,416) + Year ended March 31, Particulars Reliance Mutual Fund Average Asset under 1,144 1, Management (Rs. billin) Reliance Life Insurance New business premium 39,208 30,349 18,093 Reliance General Insurance Cmbined Rati (%) 116% 140% 145% Reliance Cmmercial Finance Lan bk size 91, , ,386 Reliance Securities Brking Accunts (Ns.) 640, , ,900 + All the financial highlights given are based n cnslidated audited results Review reprt fr year ended March 31,

5 SECTION 2 AN OVERVIEW Intrductin: Reliance Capital is ne f India s leading private sectr financial services cmpanies and ranks N. 1 amng financial services cmpanies, in terms f net wrth. Reliance Capital is a part f the Reliance Grup and is a cnstituent f CNX Nifty Junir and MSCI India. Reliance grup is amngst India s leading business huses with ver 230 millin custmers. It has a strng presence acrss a wide array f high grwth cnsumer facing businesses f financial services, telecm, energy, pwer, infrastructure and media and entertainment. Reliance Capital has interests in asset management and mutual funds; life and general insurance; cmmercial finance; equities and cmmdities brking; investment banking; wealth management services; distributin f financial prducts; exchanges; private equity; asset recnstructin; prprietary investments and ther activities in financial services. Reliance Capital Asset Management Reliance Capital Asset Management (RCAM) managed Rs. 1.4 trillin (US$ 27.5 billin) as n March 31, 2012 acrss: mutual funds* - Rs billin (US$ 15.3 billin) pensin funds - Rs billin (US$ 11.6 billin) managed accunts - Rs billin (US$ millin) and hedge funds - Rs billin (US$ millin) * - average assets under management fr the quarter ended March 31, 2012 RCAM s incme frm its peratins fr the year ended March 31, 2012 was at Rs. 6.6 billin (US$ millin) - YY decrease f 9%, mainly n accunt f 6% decline in AAUMs RCAM s ttal expenditure frm its peratins fr the year ended March 31, 2012 was at Rs. 3.6 billin (US$ 74.5 millin) - YY decrease f 19% in line with fcus n leaner cst f peratins Prfit befre tax fr the year ended March 31, 2012 was Rs. 3.1 billin (US$ 64.2 millin) - YY increase f 5% Review reprt fr year ended March 31,

6 Fcus n retail lng term debt and higher yield prducts, imprved PBT margins t 46.3% in FY12 frm 40.1% in FY11 Achievements: Nippn Life, largest private life insurer in Asia, signed final agreements t acquire a 26% stake in RCAM, subject t regulatry apprvals The transactin pegs RCAM valuatin at Rs. ~56 billin (US$ 1.1 billin), translating t 7% f AAUM This is the largest FDI in Indian Mutual Fund Sectr till date and the largest investment in any Indian AMC Nippn Life is a 122 year ld Glbal Frtune 100 cmpany, and manages ver Rs. 30 trillin (ver US$ 600 billin) in assets, amngst the largest ttal assets in the wrld fr any life insurer Nippn Life t invest Rs billin (US$ millin) fr 26% stake Adjudged as the Best BFSI Asset Management Cmpany by Business & Ecnmy Magazine Awarded the Best Fund Huse 2011 by MneyLife, a persnal finance magazine, based n five-year perfrmance f Equity Funds RCAM wn fur awards at the 9 th Annual ICRA Mutual Fund Awards 2012 Wn awards fr being the Mst investr Friendly Fund Huse f The Year and fr Reliance Gld Savings Fund as the Mst Innvative Fund Of The Year at the CNBC - TV18 CRISIL Mutual Fund Awards 2012 Awarded Asia's 10 th Best Emplyer fr by Asia s Best Emplyer Brand Awards Reliance AnyTime Mney Card and Edge - The Learning Academy - rated amng Tp 50 Financial Inclusin Prjects by Skch Cnsultancy Services Reliance Mutual Fund Reliance Mutual Fund (RMF) is amngst the tp 2 mutual funds in India in terms f Assets under Management, with a market share f 12% Review reprt fr year ended March 31,

7 The AAUM fr the quarter ended March 2012 was at Rs billin (US$ 15.3 billin) as against Rs. 1.0 trillin fr the crrespnding previus perid RMF cntinues t be the mst prfitable Mutual Fund in India fr the cnsecutive secnd year. High fcus n the untapped retail pprtunity Reliance Mutual Fund had launched an unique retail Gld Savings Fund NFO in February 2011 This fund was the largest and first Gld fund in India The ETF + FF has crssed ver Rs billin (US$ millin) in AAUM fr the quarter ended March 31, YY grwth f 511% RMF had 28% market share in gld AAUMs as n March 31, 2012 The Systematic Investment Plan (SIP) investr accunts at the end f the year, were nearly 1.7 millin As n March 31, 2012, there were ttal f 44 schemes - 21 Equity riented schemes, 20 debt riented schemes, 2 exchange traded schemes and 1 fund f funds scheme At the end f FY12, RCAM had a wide distributin netwrk spanning ver 250 ffices acrss India Reliance Life Insurance Reliance Life Insurance (RLI) ffers prducts that fulfill savings and prtectin needs f custmers. Reliance Life ffers 25 prducts, f which 19 are targeted at individuals and 6 at grup business Reliance Life Insurance has 16 ptinal rider fferings t prvide cmprehensive risk prtectin t custmers. Of these, 12 are fr Individual Business Segment and the rest fr the Emplyee Benefits Business Segment Reliance Life is cmmitted t emerge as a transnatinal Life Insurer f glbal scale and standard and attaining leadership rankings in the industry within the next few years Review reprt fr year ended March 31,

8 RLI is amngst the leading Indian private sectr insurers in terms f new business premium with a private sectr market share f 5.53%. (Surce: March 2012 data, IRDA website) Ttal premium (Net f Reinsurance) fr the year was Rs billin (US$ 1.1 billin) Renewal premium fr the year was Rs billin (US$ millin) New business premium fr the year ended March 31, 2012, was Rs billin (US$ millin). Nearly 70% f the new business individual premium was cntributed by traditinal prducts RLI achieved a prfit befre tax f Rs. 3.7 billin (US$ 77.7 millin), fr the year ended March 31, RLI has been making cnsistent mnthly prfits since September The declared results f Reliance Capital include cnslidatin f 38% stake f RLI During FY12, net surplus amunt transferred frm plicyhlder s accunt t sharehlders accunt std at Rs. 3.2 billin (US$ 63.4 millin). This surplus has been included in the Q4 and FY12 pretax prfit The ttal funds under management were at Rs billin (US$ 3.7 billin) as n March 31, 2012 The distributin netwrk std at 1,230 ffices acrss India The number f agents as n March 31, 2012 were at 150,590 as against 189,304 agents as n March 31, YY planned decline f 20%, in line with fcus n prductivity and perfrmance f agents Maintained leading psitin amngst private life insurers in terms f number f plicies sld in FY12. Nearly 1.1 millin plicies were sld in FY12 by RLI Capital infusin during the year std at Rs. 3.0 billin (US$ 58.6 millin), pst the strategic stake sale t Nippn Life. The ttal capital invested in this business, as n March 31, 2012, was Rs billin (US$ millin) Achievements: Nippn Life, Japan s largest private life insurer, acquired a 26% stake in Reliance Life Insurance fr Rs billin (US$ millin) Review reprt fr year ended March 31,

9 The transactin values Reliance Life Insurance at apprximately Rs. 115 billin (US$ 2.2 Billin) This is the largest FDI in Indian Financial Services sectr and by far, the largest FDI in Insurance sectr RLI is amngst the tp 3 mst trusted Insurance brands in India as per Mst Trusted Brands Survey 2011 by Brand Equity and Nielsen Wn the Best Nn-Urban Cverage award at the Indian Insurance Awards 2011 Wn the Quality Cuncil f India (Gvernment f India) - D.L. Shah Natinal Award 1 st Life Insurance C. in India t be rated AAA by Brickwrks Rating fr Enterprise wide Risk Management Achieved best-in-class Custmer and Advisr satisfactin scres in the survey cnducted by Nielsen fr Reliance Life Insurance Reliance Cmmercial Finance Reliance Cmmercial Finance (RCF) ffers a wide range f prducts which include Hme lans, Lans against prperty, SME lans, Cmmercial Vehicle lans, Lans fr Cnstructin equipment, Car lans and Infrastructure financing RCF is amngst the leading lenders in the Indian nn banking finance sectr The fcus at Reliance Cmmercial Finance is nt nly credit grwth per se but the quality f credit surced. In line with this, the Cmpany has been disbursing nly secured asset backed lans and winding dwn the unsecured lans prtfli As n March 31, 2012, nearly 100% f the utstanding bk was secured as against 97% as n March 31, 2011 The disbursements fr the year ended March 31, 2012 were Rs billin (US$ 1.6 billin) as against Rs billin fr crrespnding previus perid - decrease f 10% As n March 31, 2012, the assets under management (including securitized prtfli) was Rs billin (US$ 2.9 billin) as against Rs billin as n March 31, YY increase f 9% Review reprt fr year ended March 31,

10 As n March 31, 2012, the utstanding lan bk was Rs billin (US$ 2.6 billin) as against Rs billin as n March 31, YY increase f 8%. This lan bk is spread acrss 94,202 custmers frm tp 18 Indian metrs During the year, RCF securitized lans f Rs billin (US$ millin), as against Rs billin in previus year - a YY increase f 23% Ttal incme std at Rs billin (US$ millin) in FY12 as against Rs billin in crrespnding previus perid - YY increase f 42% The Net Interest Incme fr the year ended March 31, 2012 was Rs. 5.1 billin (US$ millin) RCF achieved a prfit befre tax f Rs. 2.5 billin (US$ 52.9 millin) despite 87% increase in interest csts Brking business Reliance Capital s brking business cnsists f Reliance Securities, ne f the leading retail brking huses in India, that prvides custmers with access t equities, equity ptins and cmmdities futures, wealth management, prtfli management services, mutual funds, IPOs and investment banking, and Quant Capital, which caters t whlesale client segment f the capital markets, including freign and dmestic institutins, crpratins and ultra high net wrth individuals The fcus is n the key business verticals f brking, wealth management and investment banking Equity Brking: It had 684,917 retail brking accunts as n March 31, YY increase f 3% Daily average stck exchange turnver std at Rs billin (US$ millin) Wealth Management: In wealth management, client needs are assessed t create custmized financial investment pprtunities. Custmized individual prtflis are based n their diverse investment needs and risk prfiles Review reprt fr year ended March 31,

11 The AUM as n March 31, 2012 has increased t Rs. 5.8 billin (US$ millin) frm Rs. 2.3 billin as n March 31, an increase f 152% Investment Banking: In investment banking, the capital requirements f enterprises are addressed thrugh varius instruments - IPOs, private placements, M&A etc. In FY12: As Syndicate member, handled 2 issues in FY12; ttal amunt mbilized - Rs. 792 millin (US$ 15.5 millin) IPO funding - Rs. 1.4 billin (US$ 26.4 millin) Cmmdity Brking: It had ver 35,450 cmmdity brking accunts as n March 31, YY increase f 4% The average daily cmmdities brking turnver was Rs. 9.8 billin (US$ millin) - YY increase f 195% Revenues f the brking business std at Rs. 3.6 billin (US$ 75.1 millin) fr the year ended March 31, YY increase f 43% The business achieved a prfit befre tax f Rs millin (US$ 6.7 millin) fr the year ended March 31, YY increase f 54% Awards Received Best Emplyer brand award by The Emplyer Branding Institute, Singapre Received Brand Leadership legacy award, Business Leadership Award and Business Super Achiever Award at the Asian Leadership Awards Dubai 2011 Distributin business - Reliance Mney The distributin business f Reliance Capital, branded as Reliance Mney is a cmprehensive financial services and slutins prvider, prviding custmers with access t mutual funds, life and general insurance prducts, mney transfer, currency exchange, lans, gld cins and premium prducts Review reprt fr year ended March 31,

12 As n March 31, 2012, Reliance Mney had a pan India distributin netwrk f ver 6,000 utlets Reliance Mney is manufacturer agnstic and distributes mutual funds, life & general insurance prducts, lans and precius metal retailing Reliance Mney sld ver 2.2 tns f gld in the year ended March 31, % YY increase Reliance Mney is the largest private sectr partner fr Western Unin Mney Transfer in India millin mney transfer transactins handled during the year - 12% YY increase Reliance Mney achieved revenues f Rs. 1.1 billin (US$ 22.1 millin) fr the year ended March 31, YY increase f 81% The business achieved a prfit befre tax f Rs millin (US$ 4.9 millin) fr the year ended March 31, YY increase f 88% Reliance General Insurance Reliance General Insurance (RGI) ffers insurance slutins fr aut, health, hme, prperty, travel, marine, cmmercial and ther specialty prducts RGI is the amngst the leading private sectr general insurance players in India with a private sectr market share f 7.6% Grss Written Premium fr the year ended March 31, 2012 was Rs billin (US$ millin) The cmbined rati (including 3 rd party mtr pl) was 145% The lss was at Rs. 3.4 billin (US$ 71.6 millin) fr the year ended March 31, 2012 as against Rs. 3.1 billin in crrespnding previus perid The increase in lss and cmbined rati was mainly n accunt f strengthening the third party mtr claims reserves. Third party mtr claims prvisin was Rs. 2.2 billin (US$ 45.3 millin) in FY12 as against Rs. 1.8 billin in FY11. This cmmercial vehicle market arrangement has been disbanded frm April 1, 2012 nwards Review reprt fr year ended March 31,

13 The fcus at RGI is n writing prfitable business and imprving the cmbined rati. In line with this, the cmpany is ptimizing its prduct prtfli mix and is increasing its cmmercial lines f business. During the FY12, RGI realized a grss written premium f Rs. 3.4 billin (US$ 70.8 millin) frm cmmercial lines f business, as against Rs. 3.1 billin in FY11 - YY increase f 9% During the year, a fresh capital infusin f Rs. 4.4 billin (US$ 92.4 millin) was made int the business The ttal capital invested is Rs billin (US$ millin) The distributin netwrk cmpsed f 151 branches and ver 6,500 intermediaries as n March 31, 2012 Reliance ExchangeNext Ltd Reliance ExchangeNext Limited (R Next), is an initiative f Reliance Capital in the exchange space t set up mdern exchanges, in varius segments R Next has a 26% stake in Indian Cmmdity Exchange Ltd. (ICEX), as an anchr investr, a screen based nline derivative exchange fr cmmdities ICEX has pedigreed investrs and alng with Reliance Spt Exchange (RSX), will be able t ffer cmprehensive range f integrated prducts. ICEX will enable physical delivery t its members while RSX members can hedge their psitins, creating immense benefit fr the members f bth exchanges and upgrade the existing ecsystem R Next aims t make ICEX an unique Cmmdity Exchange - a chice f all Stake Hlders Reliance Spt Exchange Reliance Spt Exchange (RSX), a whlly wned subsidiary f R Next, is a physical delivery based cmmdity exchange set up by R Next Reliance Spt Exchange is an initiative f Reliance Capital in the exchange space t set up mdern exchanges, in varius segments Review reprt fr year ended March 31,

14 RSX aims t bring different markets tgether n a natinal electrnic platfrm thereby creating transparency, efficiency and infrastructure fr spt markets acrss India RSX has received state licenses frm Gujarat, Karnataka & Rajasthan Gvernments. The prcess fr btaining state licenses frm Maharashtra, Andhra Pradesh and Madhya Pradesh has been initiated RSX has launched E Gld Suk - Physical trading platfrm in Bullin. During the year, ver 600 kgs. f gld were transacted RSX has traded 44,000 MT during FY12 acrss all agriculture cmmdities Quant Capital Quant Capital fcuses n the whlesale client segment f the capital markets which includes freign and dmestic institutins, crpratins and ultra high net wrth individuals. Apart frm traditinal fundamental research, it als cmbines quantitative and behaviral research t frecast trends and inflectin pints fr glbal currencies, cmmdities, and equities Quant has been extensively featured in the Asia Mney plls In the Overall Prime Brking Services categry acrss Asia, Quant is the nly Indian firm t have been featured in the list. In the Overall Hedge Fund Services categry acrss Asia, Quant is nly ne f tw Indian firms that have qualified in the tp 30 list In these plls, Quant has been placed 16 th in the Overall Best Lcal Brkerage categry and 11 th in the Mst Independent Research Brkerage categry. Under India Research, Quant has been rated in the tp 30 under the heads f Cuntry Research, Strategy, Macrecnmics, Small Caps, Banks, Capital Gds, Energy, Materials and Sftware & Services. Quant has als been rated in the tp 30 in the categries f Overall Sales Services, Executin, Events and/r Cnferences Reliance Equity Advisrs (India) Limited (REAL) Reliance Equity Advisrs, whlly wned subsidiary f Reliance Capital, manages a private equity fund, the Reliance Alternative Investments Fund - Private Equity Scheme I, which is in the prcess f investing funds which it has successfully raised in the dmestic market thrugh a mix f Institutinal and HNI clients Reliance Equity Advisrs (India) Limited (Reliance Private Equity)'s first Fund, the Reliance Alternative Investments Fund - Private Equity Scheme I is clse t Review reprt fr year ended March 31,

15 cmpleting investments aggregating t ver 60% f the fund size. The fund is currently in the prcess f cncluding an investment in the dmestic appliances space, and als has an attractive deal pipeline including a prpsed investment in a white gds cmpany REAL cntinues t evaluate investment pprtunities in the prmising and fast grwing sectrs. The Fund s existing investments cntinue t perfrm in line with expectatins. The fund cntinues t be clsely invlved in adding significant value t investee cmpanies, and in mnitring their grwth clsely Reliance Asset Recnstructin Reliance Asset Recnstructin Ltd. (Reliance ARC) is in the business f acquisitin, management and reslutin f distressed debt/assets. The ther spnsrs / sharehlders f Reliance ARC are Crpratin Bank, Indian Bank, GIC f India, Dacecrft and Blue Ridge The assets under management as n March 31, 2012 were Rs millin (US$ 18.6 millin) Reliance Venture Asset Management (RVAM) Reliance Venture Asset Management, whlly wned subsidiary f Reliance Capital, is the venture capital arm f the Reliance Grup with an investment mandate t incubate r invest int high-grwth, new business ideas and is stage, sectr and gegraphy agnstic Ranked 30 th in the reputed list f US-based, Red Herring Tp 100 Glbal Venture Capital firms in 2009 ut f 1,800 glbal VC firms, frm 32 cuntries, and acrss 12 benchmarks, Reliance Venture is the nly Indian Crprate Venture Capital firm t feature in the ranking RVAM is als a recipient f the "Excellence Award" frm India's Institute f Ecnmic Studies, a quasi-gvernment agency started by Members f the Indian Parliament, industry leaders, ecnmists and educatinal leaders RVAM s prtfli cmpanies are cnsidered as categry creatrs and industry leaders. It has spawned cmpanies including husehld names such as India's largest nline travel website Yatra.cm, Suvidhaa - India s leading service cmmerce cmpany, Stke, Inc. - a leader in multi access cnvergence netwrk, Tesslve - a leading semi-cnductr testing cmpany amngst many thers Review reprt fr year ended March 31,

16 The Cmpany has fstered relatins with glbal premier institutins and is the exclusive India partner fr MIT and Stanfrd University fr their entrepreneurship and business cmpetitins. RVAM has als funded tw start-ups frm MIT RVAM endeavrs t be the preferred chice and premier partner f all its prtfli cmpanies and assures its full cmmitment t them ver an unlimited perid f time RVAM currently manages assets f Rs 1.9 billin (US $ 36.2 millin) as n March 31, 2012 Review reprt fr year ended March 31,

17 SECTION 3 FINANCIAL AND OPERATING HIGHLIGHTS Key Highlights fr the year ended March 31, 2012 Ttal incme f Rs billin (US$ 1.4 billin) against Rs billin in the crrespnding previus perid - an increase f 20%, mainly n accunt f sale f stake in Life Insurance business, and increase in tpline f Cmmercial Finance and Brking & Distributin businesses Net prfit f Rs. 4.6 billin (US$ 95.5 millin) against Rs. 2.9 billin in the crrespnding previus perid - a grwth f 57% Net debt t equity imprved by 27% t 1.56 as n March 31, 2012, as cmpared t 2.14 at the end f FY11 Summary f Cnslidated Financial Statements (Rs. Millin) Q4FY12 Q4FY11 Q3FY12 FY12 FY11 Ttal incme 20,019 16,003 15,868 66,269 55,359 Staff csts 1,268 1,241 1,337 5,478 4,973 Other expenditure 3,690 3,427 2,854 12,380 12,388 Reinsurance premium ceded 1,766 1,700 1,842 7,515 6,635 Claims incurred 4,672 6,205 2,777 12,659 13,314 Interest & financial charges 5,646 4,290 5,892 22,501 14,639 Depreciatin Prfit befre tax 2,811 (848) 1,033 5,192 2,911 Net Prfit after Minrity Interest & share f prfit f assciates 3,293 (65) 602 4,578 2,912 Diluted EPS (Rs) (0.26) Ttal incme: RCL s cnslidated incme frm peratins fr the year ended March 31, 2012 was Rs billin (US$ 1.4 billin) frm Rs billin in the crrespnding previus perid - an increase f 20%, mainly n accunt f sale f stake in Life Insurance business, and increase in tpline f Cmmercial Finance and Brking & Distributin businesses. Review reprt fr year ended March 31,

18 Operating expenses: Staff csts fr the year ended were Rs. 5.5 billin (US$ millin) as against Rs. 5.0 billin in the crrespnding previus perid - an increase f 10%. Selling, general & administrative expenses fr the year ended March 31, 2012 remained flat at Rs billin (US$ millin) as against the crrespnding previus perid. Finance cst and Net prfit frm peratins: Interest & finance charges fr the year were Rs billin (US $ millin) as against Rs billin in the crrespnding previus perid - an increase f 54% due t cntinued high interest rate envirnment. Depreciatin fr the year was Rs millin (US$ 11.3 millin) as against Rs millin in the crrespnding previus perid, an increase f 9%. Prfit after tax, minrity interest and share f prfit f assciates fr the year ended March 31, 2012 was Rs. 4.6 billin (US$ 95.2 millin) as against Rs. 2.9 billin in the previus year, an increase f 57%. Prfit rse mainly n accunt f part cnslidatin f Life Insurance prfits and gains n sale f equity stake in the Life Insurance business t Nippn Life, partially ffset by lss in General Insurance Balance sheet As n March 31, 2012, the cmpany had ttal assets f Rs billin (US$ 6.9 billin) - YY increase f 10%. The cmpany had a net wrth f Rs billin (US$ 2.3 billin). This resulted in net debt t equity rati f 1.56, as against 2.14 as n March 31, an imprvement f 27%. It enjys the highest ratings f A1+ by ICRA and CRISIL, fr its shrt term brrwing prgram and CARE AAA by CARE fr its lng term brrwing prgram. Review reprt fr year ended March 31,

19 BUSINESS WISE PERFORMANCE RELIANCE CAPITAL ASSET MANAGEMENT FINANCIAL PERFORMANCE (Rs. Millin) Q4FY12 Q4FY11 Q3FY12 FY12 FY11 Ttal Incme 1,792 2,062 1,550 6,647 7,330 Ttal Expenses 781 1, ,571 4,387 Prfit befre tax 1, ,076 2,943 Discussin f financial perfrmance Ttal incme: RCAM s incme frm its peratins fr the year ended March 31, 2012 was at Rs. 6.6 billin (US$ millin) as against Rs. 7.3 billin in the crrespnding previus perid - a YY decrease f 9% mainly n accunt f 6% decline in AAUMs RCAM s ttal expenditure frm its peratins fr the year ended March 31, 2012 was at Rs. 3.6 billin (US$ 74.5 millin) - YY decrease f 19% in line with fcus n leaner cst f peratins Prfit befre tax fr the year ended March 31, 2012 was Rs. 3.1 billin (US$ 64.2 millin) - YY increase f 5% Review reprt fr year ended March 31,

20 RELIANCE LIFE INSURANCE Amngst leading private sectr life insurers in India with private sectr market share f 5.53% in terms f new business premium FINANCIAL PERFORMANCE (Rs. Millin) Q4FY12 Q4FY11 Q3FY12 FY12 FY11 First year premium 5,868 6,748 3,125 14,364 22,846 Single premium 1,475 3, ,729 7,503 Ttal new business premium 7,343 10,297 3,976 18,093 30,349 Renewal premium 12,318 13,045 7,804 36,883 35,362 Ttal premium (Net f Reinsurance) 19,587 23,282 11,732 54,702 65,479 Prfit befre tax 3,463* ,726* (1,293) Operating Csts (excl. cmmissin) 3,778 3,480 3,186 12,935 15,640 Ttal Funds under management 187, , , , ,553 Capital infused - - 3,000 3,000 1,200 Q4FY12 Q4FY11 Q3FY12 FY12 FY11 N f ffices 1,230 1,248 1,252 1,230 1,248 N f agents 150, , , , ,304 *: Including plicyhlder s surplus transferred t sharehlders accunt Ttal premium (net f reinsurance) fr the year was Rs billin (US$ 1.1 billin) Renewal premium fr the year was Rs billin (US$ millin) New Business Premium Incme was Rs billin (US$ millin) fr the year ended March 31, Nearly 70% f new individual business premium was cntributed by traditinal prducts RLI achieved a prfit befre tax f Rs. 3.7 billin (US$ 77.7 millin) fr the year ended March 31, 2012, as against lss r Rs. 1.3 billin in FY11. RLI has been making cnsistent mnthly prfits since September 2010 During FY12, net surplus amunt transferred frm plicyhlder s accunt t sharehlders accunt std at Rs. 3.2 billin (US$ 63.4 millin). The Q4 and FY12 prfit befre tax figures include the surplus Review reprt fr year ended March 31,

21 Operating csts (excluding cmmissin) were at Rs billin (US$ millin) fr the year ended March 31, 2012, decline f 17% YY. This is in line with the fcus t achieve leaner cst structure The ttal funds under management were at Rs billin (US$ 3.7 billin) as n March 31, 2012 The distributin netwrk std at 1,230 ffices at the end f FY12 The number f agents as n March 31, 2012 were at 150,590 as against 189,304 agents as n March 31, YY planned decline f 20% in line with fcus n prductivity and perfrmance f agents Regained leading psitin amngst private life insurers in terms f number f plicies sld in FY12. Nearly 1.1 millin plicies were sld in FY12 by RLI Capital infusin during the year std at Rs. 3.0 billin (US$ 58.6 millin), pst the strategic stake sale t Nippn Life. The ttal capital invested in this business, as n March 31, 2012 was Rs billin (US$ millin) Review reprt fr year ended March 31,

22 NEW BUSINESS ACHIEVED PROFIT (NBAP) New Business Achieved Prfit: Definitin NBAP is defined as present value f future prfits fr sharehlders n accunt f new business sales, based n a given set f assumptins. Actual experience may differ frm these assumptins. Basis f preparatin The NBAP is calculated net f tax after prviding fr cst f capital that wuld be required t supprt business. The cst f capital is taken as the difference between the nminal value fr slvency capital and the present value, at the risk discunt rate, f future releases f capital tgether with investment earnings n the slvency capital. The new business achieved prfit fr ne year ended March 31, 2012 was Rs. 1.8 billin (US$ 36.6 millin) The new business achieved prfit margin fr year ended March 31, 2012 was 15.59% The assumptins used fr calculating NBAP are as fllws: Ecnmic Assumptins: Particulars Assumptins p.a. Cash/ Mney Market / TB 5.00% Gvernment Securities 7.50% Crprate Bnds 8.50% Equities 12.00% Inflatin 5.50% Risk discunt rate 12.50% Tax rate 14.16% Operating Assumptins: Operating assumptins such as mrtality, mrbidity and persistency are based n industry and reinsurers experience, using ur perating experience where such experience is credible Expense assumptins are based n ur latest expense prjectin which reflects recent respnses t lwer grwth envirnment. The chsen expense ladings are Review reprt fr year ended March 31,

23 cnsistent with current pricing assumptins & represent ur mst recent view f lng term expense assumptins N allwance has been made fr any expense ver runs that we experience in the shrt term Prjectins assume that the cmpany applies tax at the full rate f tax n prfits/lsses arising Sensitivity: The sensitivity f the NBAP t ecnmic assumptins is given belw: (Rs. Millin) Particulars Base Value + 1% - 1% Investment return 1, , , Risk discunt rate 1, , , The investment return sensitivity cnsiders a change in the assumed rate f grwth fr unit-linked funds, the assumed rate f investment return n nn unit cash flws and reserves and n assets supprting the slvency margin, and a change in the rate f expense inflatin. Further cnsideratin: NBAP reflects 95.71% f annualized new business premium written in the ne year ended March 31, 2012 The value frm grup business and rider business has been ignred. These business lines represent 4.29% f the annualized new business premium Review reprt fr year ended March 31,

24 RELIANCE COMMERCIAL FINANCE Discussin f financial perfrmance Reliance Cmmercial Finance disbursed Rs billin (US$ 1.6 billin) f secured lans during the year, as against Rs billin fr the crrespnding previus perid, decrease f 10% As n March 31, 2012, the assets under management (including securitized prtfli) was Rs billin (US$ 2.9 billin) as against Rs billin as n March 31, increase f 9% As n March 31, 2012 the utstanding lan bk was Rs billin (US$ 2.6 billin) as against Rs billin as n March 31, YY increase f 8%. This lan bk is spread acrss 94,202 custmers frm tp 18 Indian metrs As n March 31, 2012, nearly 100% f the utstanding bk was secured as against 97% as n March 31, 2011 Persnal lans prprtin brught dwn t miniscule 0.2% f the utstanding lan bk at the end f the year as against 1.5% at the end f the crrespnding previus perid During the year, RCF securitized lans f Rs billin (US$ millin), as against Rs billin in FY11 LOAN BOOK MIX - as n March 31, 2012 Outstanding Lan bk - Rs billin Infrastructure financing 2.5% SMEs 25.5% CVs 12.0% Others 4.8% Aut 7.0% Mrtgages 48.2% Review reprt fr year ended March 31,

25 FINANCIAL PERFORMANCE (Rs. Millin) Q4FY12 Q4FY11 Q3FY12 FY12 FY11 Disbursals 15,913 32,115 19,916 79,373 87,820 Net Interest Incme 1,333 1,193 1,242 5,104 5,122 Ttal Incme 5,569 4,129 4,992 19,450 13,741 Ttal expenses ,150 2,516 Interest expenses 3,495 2,106 3,491 12,801 6,859 Prvisins ,672 Prfit befre tax ,537 2,693 Ttal incme std at Rs billin (US$ millin) in FY12 as against Rs billin in crrespnding previus perid - YY increase f 42% The Net Interest Incme fr the year ended March 31, 2012 remained flat at Rs. 5.1 billin (US$ millin) The prfit befre tax fr the year ended March 31, 2012 was Rs. 2.5 billin (US$ 52.9 millin) as against Rs. 2.7 billin fr the crrespnding previus perid, despite 87% increase in interest csts The cst t incme rati fr the year was 16% as against 18% fr FY11 The average cst f funds fr the year ended March 31, 2012 was 11.5%, as against 8.8% fr FY11 Average NIMs fr the year ended March 31, 2012, std at 4.1% Grss NPLs were 1.5% f utstanding AUMs at Rs. 2.2 billin (US$ 42.8 millin) as against 1.1% at Rs. 1.6 billin as n March 31, 2011 The cverage rati (including write-ffs) std at 68% as n March 31, 2012 Review reprt fr year ended March 31,

26 BROKING BUSINESSES FINANCIAL PERFORMANCE (Rs. Millin) Q4FY12 Q4FY11 Q3FY12 FY12 FY11 Ttal Incme 1, ,251 3,601 2,523 Ttal Expenditure 1, ,235 3,281 2,316 Prfit befre tax Discussin f financial perfrmance The ttal incme std at Rs. 3.6 billin (US$ 75.1 millin) fr the year ended March 31, YY increase f 43% The business achieved a prfit befre tax f Rs millin (US$ 6.7 millin) fr the year ended March 31, YY increase f 54% Review reprt fr year ended March 31,

27 DISTRIBUTION BUSINESS - RELIANCE MONEY FINANCIAL PERFORMANCE (Rs. Millin) Q4FY12 Q4FY11 Q3FY12 FY12 FY11 Ttal Incme , Ttal Expenditure Prfit befre tax Discussin f financial perfrmance Ttal incme std at Rs. 1.1 billin (US$ 22.1 millin) fr the year ended March 31, 2012 as against Rs. 585 millin fr the crrespnding previus perid - YY grwth f 81% The business achieved a prfit befre tax f Rs millin (US$ 4.9 millin) fr the year ended March 31, YY increase f 88% Review reprt fr year ended March 31,

28 RELIANCE GENERAL INSURANCE Amngst leading private sectr general insurers in India with private sectr market share f 7.6% FINANCIAL PERFORMANCE (Rs. Millin) Q4FY12 Q4FY11 Q3FY12 FY12 FY11 Grss Written Premium 4,185 4,373 3,998 17,125 16,554 Prfit befre Tax/ (Lss) (2,483) (2,187) (344) (3,416) (3,098) Cmbined rati with pl 197% 164% 130% 145% 140% Capital infusin 2, ,430 1,420 Investment bk 27,021 21,372 23,807 27,021 21,372 N f plicies issued (millins) N f branches N f intermediaries 6,569 4,235 5,788 6,569 4,235 SEGMENT WISE BREAK UP Premium cntributin Particulars As at March 31, As at March 31, Mtr 66% 65% Health 13% 15% Fire & Engineering 12% 10% Marine 2% 1% Others 7% 9% Ttal 100% 100% Review reprt fr year ended March 31,

29 Discussin f financial perfrmance Grss Written Premium fr the year ended March 31, 2012 was Rs billin (US$ millin) YY grwth f 3% The cmbined rati (including third party mtr pl) was 145% The lss was at Rs. 3.4 billin (US$ 71.2 millin) fr the year ended March 31, 2012 as against Rs. 3.1 billin in crrespnding previus perid The increase in lss and cmbined rati was mainly n accunt f strengthening the third party mtr claims reserves The fcus at RGI is n writing prfitable business and imprving the cmbined rati. In line with this, the Cmpany is ptimizing its prduct prtfli mix and is increasing its cmmercial lines f business. During the FY12, RGI realized a grss written premium f Rs. 3.4 billin (US$ 70.8 millin) frm cmmercial lines f business, as against Rs. 3.1 billin in FY11 - YY increase f 9% During the year, a fresh capital infusin f Rs. 4.4 billin (US$ 92.4 millin) was made int the business The ttal capital invested is Rs billin (US$ millin) The distributin netwrk cmpsed f 151 branches and ver 6,500 intermediaries as n March 31, 2012 Review reprt fr year ended March 31,

30 SECTION 4 STOCK MARKET HIGHLIGHTS General infrmatin Sharehlding and Financial data as n March 31, 2012 Cde/ Exchange / BSE RELCAPITAL / NSE Blmberg/ Reuters RCAPT.IN N f share utstanding (March 31, 2012) 245,632,800 Clsing market price (Rs.) (March 31, 2012) Cmbined vlume (NSE & BSE) (fr the year) (N. in millin / day) 3.3 Cmbined value (NSE & BSE) (fr the year) (Rs. billin / day) 1.4 F & O vlume (NSE - fr the year) (N. in millin / day) 8.5 F & O value (NSE - fr the year) (Rs. in billin / day) 3.5 Stck Beta (fr year ended March 31, 2012) 1.46 Market capitalizatin as n March 31, 2012 (Rs. billin) 80.9 Market capitalizatin as n March 31, 2012 (US$ billin) 1.6 Bk value per equity share (Rs.) Summarized sharehlding pattern as f March 31, 2012 Categry N. f shares Sharehlding Prmters 132,982, % Freign investrs - FIIs, NRIs and thers 53,610, % Dmestic institutins/ Banks / Mutual funds 13,167, % Indian public 45,871, % Ttal 245,632, % Review reprt fr year ended March 31,