With plans to raise funds totalling ₹1.62-lakh crore by December, billionaire Mukesh Ambani-controlled Reliance Industries Ltd (RIL) will emerge net-debt free by the end of this calendar year. This is much ahead of industry and analysts expectations of RIL being debt-free by March 2021.
These fund-raising plans are based on equity partnership deals or through operating cash flowsand do not include the entire proceedings of the rights issue. The plans to become debt-free are not dependent on the timelines of the proposed Saudi Aramco deal, industry sources told BusinessLine.
String of deals
RIL intends to raise ₹1,61,843-crore through a string of deals by December 2020, some of which have already been completed. The company’s net debt stood at ₹1,61,035 crore as of March 31, 2020.
The string of deals include the ₹43,574-crore deal with Facebook on April 22 in lieu of a 9.99 per cent stake and deals totaling ₹34,998 crore with Silver Lake (May 4), Vista Equity Partners (May 8), General Atlantic (May 17), and KKR (May 22).
The country’s largest private sector firm is expecting another ₹10,000 crore from similar private equity deals by December, sources added.
According to various media reports, RIL’s subsidiary Jio Platforms is in Saudi Arabia’s Public Investment Fund and Abu Dhabi-based sovereign investor Mubadala Investment Company for further fund-raising. BusinessLine could not independently verify these reports.
It has already raised ₹7,000 crore by selling a 49 per cent stake in fuel retailing to BP, ₹13,281 crore from rights issue, and expects cash profit generation of ₹53,000 crore this year, they added.
According to the rights issue payment schedule, RIL is set to receive 75 per cent of the proceeds by May-November 2021, while it will get only ₹13,280 crore this year.
RIL’s ₹53,125-crore rights issue, which is the country’s largest, had opened for subscription on May 20, and will close on June 3.
Many analysts, including Edelweiss, were expecting RIL to repay its entire net debt by the end of financial year FY21.
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