Reliance Industries Ltd (RIL) is planning to use its surplus cash to repay about Rs 15,000 crore or about 21 per cent of its debt during the current financial year. A company executive, who did not want to be identified, said the combined debt of RIL and its subsidiary, Reliance Petroleum (RPL), which is being merged with it, would be brought down to around Rs 57,000 crore this year from Rs 72,000 crore at present.
The executive said RIL required about Rs 23,000 crore during the current financial year to invest in the exploration and production business and would not raise additional funds to ensure that the level of debt remained low. The capex and repayment requirements together add up to around Rs 38,000 crore. The company intended to use a part of its cash reserves of Rs 25,000 crore and revenues from the Krishna Godavari (KG) basin gas and those from the recently-commissioned refinery in Jamnagar to meet its requirements, the executive said. The refinery is expected to be fully operational during the current quarter.
During 2008-09, RIL`s debt rose 46.55 per cent to Rs 53,457 crore after it invested in gas exploration and production in the KG basin. So far, the company has invested more than Rs 50,000 crore in its exploration and production business. The details of RPL`s debt were unavailable, but company sources said that it would be around Rs 18,500 crore. 'Though we are pretty comfortable with our debt position, the company plans to keep the debt lower, leaving space for future fund-raising,' said another official in the company.
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