21 reliance hypermart limited

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RELIANCE HYPERMART LIMITED

Annual Report2009 - 2010


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1Reliance Hypermart Limited

Directors Report

Dear Members,

Your Directors are pleased to present the Fourth Annual Report

and the Audited Accounts for the year ended on March 31,

2010.

Financial Results

The financial performance of the Company for the year ended

on March 31, 2010 is summarized below:

(Rupees in Lakh)

2009-2010 2008-2009

Profit/(Loss) before Depreciation,

Interest and Tax (4,447.64) (5,887.57)

Less: Interest 4.22 6.36

Depreciation 2,312.86 1,496.61

Profit/(Loss) Before Tax (6,764.72) (7,390.54)

Less: Provision for

Fringe Benefit Tax - 64.65

Deferred Tax (2,513.66) (2,270.94)

Profit/(Loss) after tax (4,251.06) (5,184.25)

Balance brought forward from

Previous Year (5,432.33) (2,48.08)

Balance carried forward to

Balance Sheet (9,683.39) (5,432.32)

Operational and Financial Review

The Company operates RelianceMart and RelianceSuper

format of large stores in major cities and towns in India,

providing world-class ambience and shopping experience to its

customers. RelianceMart and Reliance Super offer products at

affordable prices and cater to people of all age groups.

The Company has incurred a loss of Rs. 4251.06 Lakh for the

financial year ended March 31, 2010. With the proposed

launch of new RelianceMarts and Reliance Super in the coming

months and further optimization of resources and planned

productivity measures, the Company is confident of postingbetter results in the coming years.

Dividend

Your Directors have not recommended any dividend on Equity

Shares for the period under review.

Subsidiary Company

The audited statements of accounts of the subsidiary of the

Company, together with the Reports of the Board of Directors

and Auditors for the year ended 31st March, 2010 are attached

as required under Section 212 of the Companies Act, 1956.

Directors

In accordance with the provisions of the Companies Act, 1956,

Shri Raghu Pillai retires by rotation and being eligible, offershimself for reappointment at the ensuing Annual General

Meeting.

Directors Responsibility Statement

Pursuant to the requirement under Section 217(2AA) of the

Companies Act, 1956 with respect to Directors Responsibility

Statement, it is hereby confirmed that:

(i) in the preparation of the accounts for the year ended 31st

March, 2010, the applicable accounting standards have

been followed and there are no material departures from

the same;

(ii) the Directors have selected such accounting policies and

applied them consistently and made judgments and

estimates that are reasonable and prudent so as to give atrue and fair view of the state of affairs of the Company

at the end of the financial year and of the loss of the

Company for the year under review;

(iii) the Directors have taken proper and sufficient care for

the maintenance of adequate accounting records in

accordance with the provisions of the Companies Act,

1956 for safeguarding the assets of the Company and for

preventing and detecting fraud and other irregularities;

(iv) the Directors have prepared the accounts for the year

ended 31st March, 2010 on a going concern basis.

Auditors

During the year, Messrs S. R. Batliboi & Co., Chartered

Accountants, resigned as joint statutory auditors of the

Company. To fill this vacancy, Messrs S. V. Ghatalia &

Associates, Chartered Accountants, were appointed as Joint

Statutory Auditors of the Company.


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2 Reliance Hypermart Limited

Messrs Chaturvedi & Shah, Chartered Accountants and messrsS. V. Ghatalia & Associates, Chartered Accountants, Statutory

Auditors of the Company, hold office until the conclusion of

the ensuing Annual General Meeting of the Company and are

eligible for re appointment.

The Company has received letters from them to the effect that

their re-appointment, if made, would be within the prescribed

limits under Section 224(1B) of the Companies Act, 1956 and

that they are not disqualified for such re-appointment within

the meaning of Section 226 of the Companies Act, 1956.

Particulars of Employees

As required under the provisions of Section 217(2A) of the

Companies Act, 1956, read with the Companies (Particulars

of Employees) Rules, 1975, as amended, the names and other

particulars of the employees are set out in the Annexure to

this Report.

Conservation of Energy, Technology Absorption and

Foreign Exchange Earnings and Outgo

The particulars relating to conservation of energy, technology

absorption and foreign exchange earnings and outgo, required

to be furnished pursuant to Section 217(1)(e) of the Companies

Act, 1956, read with Companies (Disclosures of Particulars

in the Report of Board of Directors) Rules, 1988, are as under:

i. Part A and B of the Rules, pertaining to conservation ofenergy and technology absorption, are not applicable to

the Company.

ii. Foreign Exchange Earnings and Outgo:

Foreign Exchange Earned : Rs. Nil

Foreign Exchange Used : Rs. 31.44 Lakh

Acknowledgement

Your Directors would like to express their grateful appreciation

for assistance and cooperation received from Reliance Industries

Limited, Reliance Retail Limited, Banks, Government

Authorities, Customers, Vendors, Employees and Members

during the year under review.

For and on behalf of the Board of Directors

Raghu Pillai Madhavan Ganesan

Director Director

Place: Mumbai

Date: April 22, 2010

Directors Report


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Auditors Report

To the Members ofRELIANCE HYPERMART LIMITED

We have audited the attached Balance Sheet of RELIANCE

HYPERMART LIMITED (the Company) as at March 31,

2010, the Profit and Loss Account and also the Cash Flow

Statement for the year ended on that date annexed thereto.

These financial statements are the responsibility of the

Companys management. Our responsibility is to express an

opinion on these financial statements based on our audit.

1. We have conducted our audit in accordance with the

Auditing Standards generally accepted in India. Those

standards require that we plan and perform the audit to

obtain reasonable assurance about whether the financial

statements are free of material misstatement. An audit

includes examining, on a test basis, evidence supporting

the amounts and disclosures in the financial statements.

An audit also includes assessing the accounting principles

used and significant estimates made by the management,

as well as evaluating the overall financial statement

presentation. We believe that our audit provides a

reasonable basis for our opinion.

2. As required by the Companies (Auditors Report) Order

2003 (as amended) issued by the Central Government of

India in terms of sub-section (4A) of section 227 of the

Companies Act, 1956, we enclose in the Annexure a

statement on the matters specified in paragraphs 4 and 5

of the said Order.

3. Further to our comments in the Annexure referred to

above, we report that:

a) We have obtained all the information and

explanations, which to the best of our knowledge and

belief were necessary for the purposes of our audit;

b) In our opinion, proper books of account as required

by law have been kept by the Company so far as

appears from our examination of those books;

c) The Balance Sheet, the Profit and Loss Account and

Cash Flow Statement dealt with by this report are

in agreement with the books of account;

d) In our opinion, the Balance Sheet, Profit and Loss

Account and Cash Flow statement dealt with by this

report comply with the mandatory Accounting

Standards referred to in sub-section (3C) of section

211 of the Companies Act, 1956;

e) On the basis of written representations received fromthe Directors as on March 31, 2010 and taken on

record by the Board of Directors, we report that

none of the Directors is disqualified as on March 31,

2010 from being appointed as a director in terms of

clause (g) of sub-section (1) of section 274 of the

Companies Act, 1956;

f) In our opinion and to the best of our information

and according to the explanations given to us, the

said accounts give the information required by the

Companies Act, 1956, in the manner so required, and

present a true and fair view in conformity with the

accounting principles generally accepted in India:

(i) in the case of the Balance Sheet, of the state ofaffairs of the Company as at March 31, 2010;

(ii) in the case of the Profit and Loss Account, of

the loss for the year ended on that date; and

(iii) in the case of the Cash Flow Statement, of the

cash flows for the year ended on that date.

For Chaturvedi & Shah For S.V.Ghatalia & Associates

Registrat ion Number : 101720W Registra tion Number: 103162W

Chartered Accountants Chartered Accountants

Amit Chaturvedi per Sudhir Soni

Partner Partner

Membership No.: 103141 Membership No.: 41870

Place: Mumbai Place: Mumbai

Date: April 22, 2010 Date: April 22, 2010


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Annexure referred to in paragraph 2 of our report of even dateRe. Reliance Hypermart Limited (the Company)

1. a) The C om pa ny has m aintaine d pr oper r ec or dsshowing full particulars, including quantitative details

and situation of fixed assets.

b) Fixed assets have been physically verified by the

management in a phased periodical manner as per

regular programme of verification, which in our

opinion is reasonable, having regard to the size of

the Company and nature of its assets. No material

discrepancies were noticed on such physical

verification.

c) There are no substantial disposals of fixed assets

during the year.

2. In respect of its inventories:

a) The inventory has been physically verified during

the year by the management. In our opinion, the

frequency of verification is reasonable.

b) The procedures of physical verification of inventories

followed by the management are reasonable and

adequate in relation to the size of the Company and

the nature of its business.

c) The Company has maintained proper records of

inventory. As explained to us, there were no material

discrepancies noticed on physical verification of

inventory.

3. The Company has neither granted nor taken any loan,

secured or unsecured to/from companies, firms and other

parties covered in the Register maintained under Section

301 of the Companies Act, 1956. Therefore, the

provisions of clause (iii) (b), (c), (d), (f), (g) of the

Companies (Auditors Report) Order 2003, (as amended)

are not applicable to the Company.

4. In our opinion and according to the information and

explanations given to us, there is an adequate internal

control system commensurate with the size of the

Company and the nature of its business for the purchase

of inventory and fixed assets and also for the sale of goods

and services. During the course of our audit, no major

weakness has been noticed in the internal control system

in respect of these areas.

5. According to information and explanation given to us,

there are no contracts or arrangements referred to in

section 301 of the Companies Act. 1956 that need to be

entered into the register maintained under section 301.

Therefore, the provisions of clause (v) (b) of theCompanies (Auditors Report) Order 2003, (as amended)

is not applicable to the Company.

6. The Company has not accepted any deposit from the

public.

7. In our opinion, the Company has an internal audit system

commensurate with the size and nature of its business.

8. To the best of our knowledge and as explained to us, the

Central Government has not prescribed the maintenance

of cost records under Section 209 (1) (d) of the Companies

Act, 1956.

9. In respect of statutory dues:

a) According to the records of the Company, the

Company is regular in depositing with appropriate

authorities undisputed statutory dues including

provident fund, investor education and protection

fund, employees state insurance, income-tax, sales-

tax, wealth-tax, service tax, customs duty, cess and

other statutory dues applicable to it. According to

the information and explanations given to us, no

undisputed amounts payable in respect of provident

fund, investor education and protection fund,

employees state insurance, income-tax, wealth-tax,

service tax, sales-tax, customs duty, cess and other

undisputed statutory dues were outstanding, as at

March 31, 2010 for a period of more than six monthsfrom the date they became payable.

b) According to the information and explanation given

to us, there are no dues of sales tax, income tax,

wealth tax, service tax, custom duty, excise duty and

cess which have not been deposited on account of

any dispute.

10. The Company has been registered for a period of less than

five years and hence we are not required to comment on

whether or not the accumulated losses at the end of the

financial year is fifty per cent or more of its net worth

and whether it has incurred cash losses in such financial

year and in the immediately preceding financial year.

11. Based on our audit procedures and according to the

information and explanations given to us, we are of the

opinion that the Company has not defaulted in repayment

of dues to banks. The Company has not borrowed any

funds from financial institutions or debenture holders

during the year under audit.


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Annexure referred to in paragraph 2 of our report of even dateRe. Reliance Hypermart Limited (the Company)

12. In our opinion and according to the explanations given tous and based on the information available, no loans and

advances have been granted on the basis of security by

way of pledge of shares, debentures and other securities.

13. In our opinion, the Company is not a chit fund or a nidhi/

mutual benefit fund/ society. Therefore, the provisions of

clause 4(xiii) of the Companies (Auditors Report) Order

2003, (as amended) are not applicable to the Company.

14. The Company has maintained proper records of

transactions and contracts in respect of dealing and trading

in shares, securities, debentures and other investments and

timely entries have been made therein. All the shares,

securities, debentures and other investments have been

held by the Company in its own name.

15. According to information and explanation given to us the

Company has not given any guarantee for loans taken by

others from bank or financial institutions. Therefore, the

provisions of Clause (xv) of Companies (Auditors

Report) Order 2003, (as amended) are not applicable.

16. The term loans raised by the company were applied for

the purpose for which loans were obtained.

17. According to the information and explanations given to

us and on an overall examination of the balance sheet of

the company, we report that the no funds raised on short-

term basis have been used for long-term investment.

18. The Company has not made any preferential allotmentof shares to parties and companies covered under Register

maintained under section 301 of the Companies Act, 1956.

19. The Company did not have any outstanding debenture

during the year.

20. The Company has not raised any monies by way of public

issue during the year.

21. Based upon the audit procedures performed for the

purpose of reporting the true and fair view of the financial

statements and as per the information and explanations

given by the management, we have not come across any

instance of material fraud on or by the Company, noted

or reported during the course of our audit

For Chaturvedi & Shah For S.V.Ghatalia & Associates

Registrat ion Number : 101720W Registra tion Number: 103162W

Chartered Accountants Chartered Accountants

Amit Chaturvedi per Sudhir Soni

Partner Partner

Membership No.: 103141 Membership No.: 41870

Place: Mumbai Place: Mumbai

Date: April 22, 2010 Date: April 22, 2010


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(Rs. in lakh)Schedule As at As at

31st March, 2010 31st March, 2009

SOURCES OF FUNDS

Shareholders Funds

Share Capital A 5.00 5.00

Loan Funds

Secured Loans B 8.03 31.42

Unsecured Loans C 144,203.38 143,591.05

144,211.41 143,622.47

TOTAL 144,216.41 143,627.47

APPLICATION OF FUNDS

Fixed Assets D

Gross Block 30,434.39 27,278.71

Less: Depreciation 3,716.99 1,492.49

Net Block 26,717.40 25,786.22

Capital Work-in-Progress 95,728.89 95,142.74

122,446.29 120,928.96

Investments E 5,055.32 4,940.32

Deferred Tax Assets 4,906.55 2,392.89

Current Assets, Loans and Advances

Current Assets F

Inventories 6,422.57 8,249.74

Sundry Debtors 673.25 584.96

Cash and Bank Balances 170.25 117.53

7,266.07 8,952.23

Loans and Advances G 3,138.99 7,986.08

10,405.06 16,938.31Less :

Current Liabilities and Provisions H

Current Liabilities 8,239.31 6,752.66

Provisions 40.89 252.68

8,280.20 7,005.34

Net Current Assets 2,124.86 9,932.97

Profit and Loss Account 9,683.39 5,432.33

TOTAL 144,216.41 143,627.47

Significant Accounting Policies M

Notes on Accounts N

Reliance Hypermart LimitedBalance Sheet as at 31st March, 2010

As per our Report of even date For and on behalf of the Board

For Chaturvedi & Shah For S.V.Ghatalia & Associates Raghu Pillai

Chartered Accountants Chartered Accountants Director

Amit Chaturvedi per Sudhir Soni Madhavan Ganesan

Partner Partner Director

Membership No. 103141 Membership No. 41870

Mumbai

Dated: 22nd April, 2010


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(Rs. in lakh)2009-10 2008-09

A: CASH FLOW FROM OPERATING ACTIVITIES:

Net Profit/ (Loss) before tax as per Profit and Loss Account (6,764.72) (7,390.54)

Adjusted for:

(Profit)/ Loss on sale/ Discarding of Assets (net) 103.34 0.02

Depreciation 2,312.86 1,496.61

Effect of Exchange Rate Change 20.83 -

Interest Income (9.33) (1.25)

Interest and Finance Charges 4.22 6.36

2,431.92 1,501.74

Operating Profit before Working Capital Changes (4,332.80) (5,888.80)

Adjusted for:Trade and Other Receivables 1,001.58 5,192.46

Inventories 1,827.17 (5,810.35)

Trade Payables 836.92 (113,727.66)

3,665.67 (114,345.55)

Cash Generated from Operations (667.13) (120,234.35)

Taxes Paid (31.70) (73.80)

Net Cash used in Operating Activities (698.83) (120,308.15)

B: CASH FLOW FROM INVESTING ACTIVITIES

Purchase of Fixed Assets (3,846.31) (15,057.16)

Sale/ Decapitalisation of Fixed Assets 329.96 1,544.21

Purchase of Investments (115.00) -

Loan to Subsidiary Company 3,788.92 (3,788.92)Interest Income 9.33 1.25

Net Cash from/ (used in) Investing Activities 166.90 (17,300.62)

C: CASH FLOW FROM FINANCING ACTIVITIES

Proceeds from Long Term Borrowings 45,001.31 151,129.50

Repayment of Long Term Borrowings (44,412.37) (13,594.30)

Interest Paid (4.29) (6.36)

Net Cash from Financing Activities 584.65 137,528.84

Net Increase/ (Decrease) in Cash and Cash Equivalents 52.72 (79.93)

Opening Balance of Cash and Cash Equivalents 117.53 197.46

Closing Balance of Cash and Cash Equivalents 170.25 117.53

Reliance Hypermart LimitedCash Flow Statement for the year 2009-10







Mumbai



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(Rs. in lakh)

SCHEDULE A As at As at


SHARE CAPITAL

Authorised:

50 000 Equity Shares of Rs. 10 each 5.00 5.00

( 50 000)

TOTAL 5.00 5.00

Issued, Subscribed, Called up and Paid-up:

Fully Paid-up

50 000 Equity Shares of Rs. 10 each 5.00 5.00( 50 000)

TOTAL 5.00 5.00

Note:

All the above 50 000 (Previous year 50 000) Equity Shares of Rs. 10 each are held by Reliance Retail Limited, the holding

company along with its nominees.

Schedules forming part of the Balance Sheet

(Rs. in lakh)

SCHEDULE B As at As at


SECURED LOANS

Term Loans from Banks

Rupee Loans * 8.03 31.42

TOTAL 8.03 31.42

* Loans are secured by hypothecation of vehicles.

(Rs. in lakh)

SCHEDULE C As at As at


UNSECURED LOANS

Long Term Loan

From holding company 144,203.38 143,591.05

TOTAL 144,203.38 143,591.05


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SCHEDULED

FIXEDASSETS

(Rs.inlakh)

Description

GrossBlock

Depreciation

NetBlock

Asat

Additions

Deductions/

As

at

Upto

Forthe

Deductions/

Upto

Asat

Asat

1stApril,2009

Adjustments

31stMarch,

2010

31stMarch,

2009

year

Adjustments

31stMarch,

2010

31stMarch,

2010

31stMarch,

200

9

PlantandMachinery

2,1

03.1

6

1,1

16.8

7

28.0

6

3,1

91.9

7

230.6

9

461.9

7

7.2

4

685.4

0

2,5

06.5

7

1,8

72.4

7

ElectricalInstallations

3,8

44.2

8

626.3

3

51.3

3

4,4

19.2

8

133.7

1

205.4

4

4.5

9

334.5

6

4,0

84.7

2

3,7

10.5

7

Equipments

12,1

02.9

6

1,0

68.5

4

242.9

9

1

2,9

28.5

1

679.6

3

1,0

15.6

4

43.2

1

1,6

52.0

6

11,2

76.4

5

11,4

23.3

3

FurnitureandFixtures

1,4

92.6

8

381.5

8

36.6

3

1,8

37.6

3

58.9

6

111.6

5

4.4

6

166.1

5

1,6

71.4

8

1,4

33.7

2

Vehicles

55.3

8

8.0

7

26.7

7

36.6

8

5.2

6

5.1

3

3.4

2

6.9

7

29.7

1

50.1

2

LeaseholdImprovements

7,6

80.2

5

475.9

5

135.8

8

8,0

20.3

2

384.2

4

513.0

3

25.4

2

871.8

5

7,1

48.4

7

7,2

96.0

1

Total

27,2

78.7

1

3,6

77.3

4

521.6

6

3

0,4

34.3

9

1,4

92.4

9

2,3

12.8

6

88.3

6

3,7

16.9

9

26,7

17.4

0

25,7

86.2

2

Previousyear

8,7

17.7

2

20,1

09.3

5

1,5

48.3

6

27,2

78.7

1

0.0

1

1,4

96.6

1

-

1,4

92.4

9

25,7

86.2

2

8,7

17.7

1

CapitalWork-in-Progress

95,7

28.8

9

95,1

42.7

4

Notes:

CapitalWork-in-Progressincludes:

i)

Rs.408.2

2lakh(PreviousYearRs.677.3

1lakh)onaccounto

fAdvanceagainstProjectContracts.

ii)

Rs.10,296.4

6lakh(PreviousYearRs.7,416.7

4lakh)onacco

untofProjectDevelopmentExpenditure.

iii)

Rs.4,589.0

7lakh(PreviousYearRs.2,512.0

2lakh)onaccountofconstructionmaterialsatsite.


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(Rs. in lakh)

SCHEDULE E As at As at


INVESTMENTS

LONG TERM INVESTMENTS

Other Investments - Unquoted, Fully paid up

In Equity Shares of Subsidiary Company * 4,940.32 4,940.32

5 60 000 Reliance Vantage Retail Limited of Rs. 10 each

(5 60 000)

TOTAL (a) 4,940.32 4,940.32

In Equity Shares of Companies

2 50 000 Reliance Eminent Trading & Commercial Private Limited of Rs. 10 each 25.00 -

(-)

2 50 000 Reliance Profilic Traders Private Limited of Rs. 10 each 25.00 -

(-)

2 50 000 Reliance Progressive Traders Private Limited of Rs. 10 each 25.00 -

(-)

2 50 000 Reliance Universal Traders Private Limited of Rs. 10 each 25.00 -

(-)

50 000 Reliance Profilic Commercial Private Limited of Rs. 10 each 5.00 -(-)

50 000 Reliance Comtrade Private Limited of Rs. 10 each 5.00 -

(-)

50 000 Reliance Ambit Private Limited of Rs. 10 each 5.00 -

(-)

TOTAL (b) 115.00 -

TOTAL (a +b) 5,055.32 4,940.32

Aggregate Value of Book value Book value

Unquoted Investments 5,055.32 4,940.32

Note:

* Investment in company under the same management.


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(Rs. in lakh)

SCHEDULE F As at As at


CURRENT ASSETS

INVENTORIES

Stores and Packing Materials 315.70 307.37

Traded Goods 6,106.87 7,942.37

6,422.57 8,249.74

SUNDRY DEBTORS (Unsecured and Considered Good (1)

Over six months 33.02 0.36

Others 640.23 584.60

673.25 584.96

CASH AND BANK BALANCES

Cash in Hand 119.39 100.28

Balance with Scheduled Banks

In Current Accounts 50.76 17.15

In Fixed Deposit Accounts 0.10 0.10

170.25 117.53

TOTAL 7,266.07 8,952.23

Note:

(1) Includes Rs. 53.56 lakh (Previous Year Rs. 8.81 lakh) receivable from the following companies under the same management:

a Reliance Leisures Limited

b Reliance-GrandVision India Supply Private Limited

c Reliance-Vision Express Private Limited

d Retail Concepts & Services (India) Limited


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(Rs. in lakh)SCHEDULE G As at As at


LOANS AND ADVANCES

UNSECURED - (Considered good unless otherwise stated)

Loans to Subsidiary Company - 3,788.92

Advance Income Tax (net of Provision) 125.00 93.30

Advances Recoverable in Cash or in kind or for value to be received (1) 589.80 1,126.86

Deposits 1,751.97 1,716.45

Balance with Service Tax/ Sales Tax Authorities, etc. 672.22 1,260.55

TOTAL 3,138.99 7,986.08

Note:

(1) Includes Rs. 41.91 lakh (Previous Year Rs. Nil) receivable from the following companies under the same management: Maximum

Balance outstanding during the year Rs. 41.91 lakh (Previous Year Rs. Nil)

a Reliance Food Processing Solutions Limited

b Reliance Fresh Limited

(Rs. in lakh)

SCHEDULE H As at As at


CURRENT LIABILITIES AND PROVISIONS

Current Liabilities

Sundry Creditors

- Micro enterprises and Small enterprises(1) - -

- Others (2) 8,239.24 6,752.66

Interest accrued but not due on loans 0.07 -

8,239.31 6,752.66

Provisions

Provision for Leave Encashment/ Gratuity 40.89 252.68

40.89 252.68

TOTAL 8,280.20 7,005.34

Note:

(1) The Company has not received the required information from Suppliers regarding their status under the Micro, Small and

Medium Enterprises Development Act, 2006. Hence disclosures, if any, relating to amounts unpaid as at the year end together

with interest paid/ payable as required under the said Act have not been made.

(2) Includes Rs. 921.44 lakh (Previous year Rs. 504.26 lakh) for capital expenditure.


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(Rs. in lakh)SCHEDULE I 2009-2010 2008-2009

OTHER INCOME

Interest

From Others 9.33 1.25

Profit on Sale of Assets - 0.08

Miscellaneous Income 82.90 60.69

TOTAL 92.23 62.02

(Rs. in lakh)

SCHEDULE J 2009-2010 2008-2009

VARIATION IN STOCKS

STOCK-IN-TRADE (at close)

Traded Goods 6,106.87 7,942.37

STOCK-IN-TRADE (at commencement)

Traded Goods 7,942.37 2,365.94

TOTAL (1,835.50) 5,576.43

(Rs. in lakh)

SCHEDULE K 2009-2010 2008-2009

OPERATING AND OTHER EXPENSES

PAYMENT TO AND PROVISIONS

FOR EMPLOYEES

Salaries, Wages and Bonus 486.91 704.33

Contribution to Provident Fund, Gratuity Fund,

Superannuation Fund, Employees State Insurance Scheme,

Pension Scheme, Labour Welfare Fund etc. 11.19 50.83

Employee Welfare and other amenities 120.98 103.00

619.08 858.16

SALES AND DISTRIBUTION EXPENSES

Samples, Sales Promotion and Advertisement Expenses 1,328.66 1,138.19

Store Running Expenses 1,627.50 1,183.55

Warehousing and Distribution Expenses 418.53 539.68

3,374.69 2,861.42

Schedules forming part of the Profit and Loss Account


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Schedules forming part of the Profit and Loss Account

(Rs. in lakh)SCHEDULE K (Contd.) 2009-2010 2008-2009

OPERATING AND ESTABLISHMENT EXPENSES

Stores and Packing Materials 496.23 566.91

Machinery Repairs 137.00 2.83

Building Repairs and Maintenance 687.17 1,022.15

Other Repairs 15.37 34.80

Rent including Lease Rentals 3,437.21 2,461.09

Insurance 11.51 11.02

Rates and Taxes 252.51 142.70

Travelling and Conveyance Expenses 23.20 62.43

Payment to Auditors 4.03 3.60

Professional Fees 17.27 20.04

Loss on Sale/ Discarding of Assets 103.34 0.10

Exchange Differences (Net) 29.64 -

Security Expenses 444.29 409.10

Electricity Expenses 1,925.35 1,233.48

Telephone Expenses 88.68 74.51

Printing and Stationery 26.15 40.42

Hire Charges 181.82 86.53

General Expenses 88.96 492.12

7,969.73 6,663.83

TOTAL 11,963.50 10,383.41

(Rs. in lakh)

SCHEDULE L

2009-10 2008-09

INTEREST AND FINANCE CHARGES

Fixed Loans 2.20 5.91

Others 2.02 0.45

TOTAL 4.22 6.36


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SCHEDULE MSIGNIFICANT ACCOUNTING POLICIES

1. Basis of Preparation of Financial Statements

The financial statements are prepared under the historical cost convention in accordance with the generally accepted accounting

principles in India, Companies (Accounting Standards) Rules 2006 and the provisions of the Companies Act, 1956.

2 Use of Estimates

The preparation of financial statements requires estimates and assumptions to be made that affect the reported amount of

the assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the

reporting period. Difference between the actual results and estimates are recognized in the period in which the results are

known/ materialised.

3 Fixed Assets

Fixed Assets are stated at cost net of CENVAT/ Value Added Tax less accumulated depreciation and impairment loss, if any.

All costs attributable to Fixed Assets are Capitalised. Improvement cost on Lease premises up to the date of commercial

operation is capitalised as Leasehold Improvements.

4 Lease Rentals

Operating lease rentals are expensed with reference to lease terms and other considerations.

5 Depreciation

Depreciation on Fixed Assets is provided on Straight Line Method at the rates and in the manner prescribed in Schedule XIV

to the Companies Act, 1956 over their useful life except, leasehold improvements are amortized over the lower of estimated

useful life or lease period; fire alarm system, signage and access control system are depreciated over the estimated useful life

of five years and baskets are depreciated over the estimated useful life of three years.

6 Impairment of Assets

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged

to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognized inprior accounting period is reversed if there has been a change in the estimate of recoverable amount.

7 Foreign Currency Transactions

i) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction

or that approximates the actual rate at the date of the transaction.

ii) Monetary items denominated in foreign currencies at the year end are restated at year end rates.

iii) Non monetary foreign currency items are carried at cost.

iv) Any income or expense on account of exchange difference either on settlement or on translation is recognised in the

Profit and Loss Account except in case of long term liabilities, where they relate to acquisition of fixed assets, in which

case they are adjusted to the carrying cost of such assets.

8 Investments

Current Investments are carried at the lower of cost and quoted/ fair value, computed category wise. Long-Term Investmentsare stated at cost. Provision for diminution in the value of Long Term Investments is made only if such a decline is other

than temporary.

9 Inventories

Items of Inventories are measured at lower of cost and net realisable value, after providing for obsolescence, if any. Cost of

Inventory comprises of all cost of purchase and other cost incurred in bringing them to the respective present location and

condition. Costs are determined on weighted average basis.

Schedules forming part of the Balance SheetSignificant Accounting Policies


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10 Turnover

Turnover includes sale of goods, service and service tax, adjusted for discounts (net) and Value Added Tax (VAT), if any.

11 Employee Benefits

i) Short term employee benefits are recognised as an expense at the undiscounted amount in the Profit and Loss Account

of the year in which the related service is rendered.

ii) Post employment and other long term employee benefits are recognised as an expense in the Profit and Loss Account

for the year in which the employee has rendered services. The expense is recognised at the present value of the amounts

payable determined using actuarial valuation techniques. Actuarial gains and losses in respect of post employment and

other long term benefits are charged to the Profit and Loss Account/ Capitliased as the case may be.

12 Provision for Current and Deferred Tax

Provision for current tax is made after taking into consideration benefits admissible under the provisions of the Income-taxAct, 1961. Deferred tax resulting from timing difference between taxable and accounting income is accounted for using the

tax rates and laws that are enacted or substantively enacted as on the Balance Sheet date. The deferred tax asset is recognized

and carried forward only to the extent that there is a virtual certainty that the asset will be realised in future.

13 Provision, Contingent Liabilities and Contingent Assets

Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a

result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized

but are disclosed in the notes. Contingent Assets are neither recognized nor disclosed in the financial statements.

SCHEDULE N

NOTES ON ACCOUNTS

1 The previous years figures have been regrouped, rearranged and reclassified wherever necessary. Accordingly, amounts and

other disclosures for the preceding year are included as an integral part of the current year financial statements and are to be read

in relation to the amounts and other disclosures relating to the current year.

2 The Company is in the process of setting up various facilities for conducting its business. The expenditure incurred during the

implementation period for bringing the Project in the condition of its intended use, is treated as Project Development

Expenditure pending capitalisation and included in Capital Work-in-Progress. Capitalisation is done in the ratio of phased

implementation. Necessary details as per part II of Schedule VI to the Companies Act, 1956 have been disclosed below:

Project Development Expenditure Account (included under Capital Work-in-Progress):

(Rs. in lakh)

2009-10 2008-09

Opening Balance 7,416.74 1,078.44

Add:

(i) Payments to and Provisions for Employees

- Salaries, Wages and Bonus 194.97 2,001.66

- Contribution to Provident Fund, Gratuity Fund,

Superannuation Fund, Employees State Insurance Scheme,

Pension Scheme, Labour Welfare Fund etc. 12.85 82.51

- Employee Welfare and other amenities 64.35 179.61

272.17

SCHEDULE M (Contd.)

Schedules forming part of the Balance SheetSignificant Accounting Policies


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(Rs. in lakh)

2009-10 2008-09

(ii) Repairs and Maintenance:

- Machinery Repairs 24.06 25.66

- Building Repairs and Maintenance 251.62 224.78

- Other Repairs 27.67 265.91

303.35

(iii) Rent including Lease Rentals 1,583.46 3,233.52

(iv) Insurance 52.80 -

(v) Rates and Taxes 48.34 141.46

(vi) Travelling and Conveyance Expenses 25.07 349.35

(vii) Professional Fees 60.59 72.26

(viii) Loss on Sale/ Discarding of Assets - 4.88

(ix) Security Expenses 17.92 113.72

(x) Electricity Expenses 287.21 592.04

(xi) Telephone Expenses 52.38 76.80

(xii) Printing and Stationery 46.81 71.84

(xiii) Hire Charges 32.90 29.82

(xiv) General Expenses 130.72 461.63

2,913.72 7,927.45

Less:

Capitalised during the year 34.00 1,589.15

Closing Balance 10,296.46 7,416.74

3 Company is mainly engaged in Organised Retail in India. All the activities of the Company revolve around this main business.

Accordingly, the Company has only one identifiable segment reportable under Accounting Standard 17 Segment Reporting,

notified in the Companies (Accounting Standards) Rules 2006.

4 As per Accounting Standard 15 Employee Benefits notified in the Companies (Accounting Standards) Rules 2006, the

disclosures of employee benefits as defined in the Accounting Standard are given below:

Defined Contribution Plan (Rs. in lakh)

Contribution to Defined Contribution Plan, recognised are charged off/ Capitalised for the year are as under:

2009-10 2008-09

Employers Contribution to Provident Fund 19.35 89.03

Employers Contribution to Pension Scheme 16.69 30.02

SCHEDULE N (Contd.)



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Defined Benefit Plan

The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which

recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit

separately to build up the final obligation. The obligation for Leave encashment is recognised in the same manner as gratuity.The

Company operates post retirement benefit plans as follows:

I) Reconciliation of opening and closing balances of Defined Benefit obligation (Rs. in lakh)

Gratuity Leave Encashment

(Unfunded) (Unfunded)

2009-10 2008-09 2009-10 2008-09

Defined Benefit obligation at beginning of the year 42.05 60.03 210.63 138.98

Current Service Cost 8.62 18.99 5.81 48.03Interest Cost 3.15 4.80 12.66 10.16

Actuarial (gain)/ loss ( 28.78) (41.77) ( 128.60) 37.43

Benefits paid ( .83) - ( 83.83) (23.97)

Defined Benefit obligation at year end 24.22 42.05 16.67 210.63

II) Reconciliation of opening and closing balances of fair value of plan assets

(Rs. in lakh)



2009-10 2008-09 2009-10 2008-09

Fair value of plan assets at beginning of the year - 60.03 - -

Expected return on plan assets - - - -

Actuarial gain/ (loss) - - - -

Employer contribution(Refund) 0.83 ( 60.03) 83.83 -

Benefits Paid (0.83) - (83.83) -

Fair value of plan assets at year end - - - -

III) Reconciliation of fair value of assets and obligations

(Rs. in lakh)



2009-10 2008-09 2009-10 2008-09

Fair value of plan assets - - - -

Present value of obligation 24.22 42.05 16.67 210.63

Amount recognised in Balance Sheet 24.22 42.05 16.67 210.63

SCHEDULE N (Contd.)



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IV) Expenses recognized during the year (Rs. in lakh)



2009-10 2008-09 2009-10 2008-09

Current Service Cost 8.62 18.99 5.81 48.03

Interest Cost on benefit obligation 3.15 4.80 12.65 10.16

Actuarial loss/ (gain) recognized in the year (28.78) (41.77) (128.60) 37.43

Past service Cost - - - -

Net benefit expense/ (Income) (17.01) (17.98) (110.14) 95.62

Actual return on plan asset - - - -

V) Actuarial assumptions (Rs. in lakh)



2009-10 2008-09 2009-10 2008-09

Discount rate (per annum) 7.50% 8.00% 7.50% 8.00%

Expected rate of return on plan assets (per annum) - 8.00% - -

Rate of escalation in salary (per annum) 6.00% 4.00% 6.00% 4.00%

The estimates of rate of escalation in salary considered in actuarial valuation, take into account inflation, seniority, promotionand other relevant factors including supply and demand in the employment market. The above information is certified by theactuary.

5 Turnover includes Income from Services of Rs. 541.60 lakh (Previous year Rs. 119.73 lakh)6 Payment to Auditors (excluding Service Tax, wherever applicable): (Rs. in lakh)

2009-10 2008-09

(i) Audit Fees 3.00 3.00

(ii) Tax Audit Fees 0.60 0.60

3.60 3.60

7 The Deferred Tax Assets (net) comprises of the following: (Rs. in lakh)

As at As at31st March, 2010 31st March, 2009

(i) Deferred Tax Assets

- Disallowance under the Income Tax Act, 1961 104.14 41.89

- Carried forward loss 10,002.77 5777.64

(ii) Deferred Tax Liability

- Related to Fixed Assets 5,200.36 3426.64

4,906.55 2,392.89

SCHEDULE N (Contd.)



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SCHEDULE N (Contd.)Note: The virtual certainty is based on agreements

8 General description of Lease Terms:

(i) Lease rentals are charged on the basis of agreed terms.

(ii) Assets are taken on lease over a period of 1 to 30 years.

9 Earnings Per Share (EPS)

2009-10 2008-09

(i) Net Profit/ (Loss) after tax as per profit and loss account (Rs. in lakh) (4,251.06) (5,184.25)

(ii) Weighted Average number of equity shares used as denominator for calculating EPS 50,000 50,000

(iii) Basic and Diluted Earnings/ (Loss) per share of face value of Rs. 10 each (Rupees) (8,502.12) (10,368.50)

10 Additional Information (to the extent applicable):

(Rs. in lakh)

As at As at


(i) Capital Commitments:

Estimated amount of contracts remaining to be executed on capital accounts

(net of advances) and not provided for 411.74 549.59

(ii) Contingent Liabilities

Outstanding guarantees furnished to Banks and Financial Institutions including in

respect of Letters of Credit. 27.55 17.45

11 Value of Imports on CIF basis in respect of: (Rs. in lakh)

2009-10 2008-09

Capital goods 24.82 1,924.86

12 Expenditure in Foreign Currency: (Rs. in lakh)

2009-10 2008-09

Other matters 6.62 -

13 Value of Stores and Packing Materials Consumed

2009-10 2008-09

% of % of

Rs. in lakh Consumption Rs. in lakh Consumption

Indigenous 496.23 100 566.91 100

14 The Ministry of Corporate Affairs, Government of India vide its order no. 46/59/2010 - CL - III dated 19-03-2010 issued

under section 211(4) of Companies Act 1956, has exempted from disclosure of quantitative detail in the Profit and Loss

Account, as required under Para 3 (i) (a) and 3 (ii) (b) of part II, Schedule VI to the Companies Act, 1956.

15 Information as required under para 3,4 and 4A to 4D of part II schedule VI of companies Act, 1956 are given to the extent



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SCHEDULE N (Contd.)applicable.

16 As per Accounting Standard 18 Related Party Disclosures notified in the Companies (Accounting Standards) Rules 2006,

the disclosures of transactions with the related parties as defined in the Accounting Standard are given below :

a) List of related parties with whom transactions have taken place and relationships:

Sr No Name of the Related Party Relationship

1 Reliance Industries Limited Ultimate Holding Company

2 Reliance Retail Limited Holding Company

3 Reliance Vantage Retail Limited Subsidiary Company

4 Reliance Ambit Trade Private Limited }

5 Reliance Agri Products Distribution Limited }

6 Reliance Autozone Limited }

7 Reliance Commercial Land & Infrastructure Limited }

8 Retail Concepts & Services (India) Limited }

9 Reliance Corporate IT Park Limited }

10 Reliance Dairy Foods Limited }

11 Reliance Digital Media Limited }

12 Reliancedigital Retail Limited }

13 Reliance Fresh Limited }

14 Reliance Food Processing Solutions Limited }

15 Reliance Footprint Limited } Fellow Subsidiaries

16 Reliance Home Store Limited }

17 Reliance Infosolution Private Limited }

18 Reliance Leisures Limited }

19 Reliance Loyalty & Analytics Limited }

20 Reliance One Enterprises Limited }

21 Reliance People Serve Limited }

22 Reliance Prolific Commercial Private Limited }

23 Reliance Supply Chain Solutions Limited }

24 Reliance Trends Limited }

25 Reliance Wellness Limited }

26 RESQ Limited }

27 Strategic Manpower Solutions Limited }



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SCHEDULE N (Contd.)b) Transactions during the year with related parties (excluding reimbursements):

(Rs. in lakh)

Sr Nature of Transactions Ultimate Holding Subsidiary Fellow TotalNo Holding Company Company Subsidiaries

Company

1 Unsecured Loan taken/ (repaid) - 612.32 - - 612.32- 137,586.31 - - 137,586.31

2 Purcahse of Investments - - - 115.00 115.00- - - - -

3 Loans and Advances given/ (returned) - - (3,788.92) 41.91 (3,747.01)- - 3,788.92 - 3,788.92

4 Turnover 2.05 46.59 - 2,797.05 2,845.69225.26 - - 1,086.70 1,311.96

5 Purchases 37.14 605.64 - 35,711.88 36,354.6638.36 5,456.52 - 29,212.84 34,707.72

6 Expenditure

- Store running expenses - - - 1,099.12 1,099.12- 8.76 - 707.40 716.16

- Warehousing and Distribution Expenses - - - 543.03 543.03- - - 986.39 986.39

- Sales Promotion Expenditure - - - - -0.64 - - - 0.64

- Rent 137.45 - - - 137.45- - - 3.85 3.85

- Professional Fees - - - - -- - - 0.07 0.07

- Hire Charges - - - 53.89 53.89- - - - -

Balance as at 31st March, 2010

7 Unsecured Loans - 144,203.38 - - 144,203.38- 143,591.05 - - 143,591.05

8 Investments - - 4,940.32 115.00 5,055.32- - 4,940.32 - 4,940.32

9 Loans and Advances - - - 41.91 41.91- - 3,788.92 - 3,788.92

10 Sundry Debtors - 0.68 - 19.40 20.08

- - - 8.81 8.81

11 Sundry Creditors 2.61 778.68 - 3,510.13 4,291.4236.70 169.73 - 1,769.89 1,976.32

12 Financial Guarantees taken - - 27.55 - - 27.55- 17.45 - - 17.45

Note: Figures in Italics represents previous years amount.



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Disclosure in respect of material Related Party Transactions during the year:

1 Unsecured Loan taken during the year (net) include Rs. 612.32 lakh (Previous Year Rs. Nil), from Reliance Retail Limited.

Unsecured Loan repaid (net) include Rs. Nil (Previous Year Rs. 137,586.31 lakh) to Reliance Retail Limited.

2 Purcahse of Investments consists of Reliance Commercial Land & Infrastructure Limited Rs.115 lakh (Previous Year

Rs. Nil)

3 Loans and Advances includes Rs. 3788.92 (Previous Year Rs. Nil) Loan repaid by Reliance Vantage Retail Limited and

Rs. 27.88 lakh (Previous Year Rs. Nil) advance paid to Reliance Fresh Limited

4 Turnover includes Reliance Fresh Limited Rs.946.41 lakh (Previous Year Rs. Nil), Reliancedigital Retail Limited Rs.587.12

lakh (Previous Year Nil), Reliance Trends Limited Rs. 377.91 lakh (Previous Year Rs.969.12), and Rs. 464.39 lakh

(Previous Year Rs. Nil) Reliance Digital Media Limited.

5 Purchases include Reliance Fresh Limited Rs. 24,245.71 lakh (Previous Year Rs.9,530.98 lakh), Reliancedigital Retail

Ltd. Rs. 3,963.07 lakh (Previous Year Rs. 5,643.39 lakh), Reliance Trends Limited Rs. 3,457.64 lakh (Previous Year Rs5,485.40 lakh), Reliance Wellness Limited Rs. 1,617.08 (Previous year Rs. Nil), Reliance Footprint Limited Rs. 575.81

lakh (Previous year Rs.Nil), and Reliance Home store Limited. Rs.1,427.61 lakh (Previous year Rs.Nil)

6 Store running expenses include Strategic Manpower Solutions Limited Rs.1,099.12 lakh (Previous Year Rs. 707.40 lakh)

and Reliance Supply Chain Solutions Limited Rs. 543.04 lakh (Previous Year Rs 986.39 lakh).

17 Loans and advances in the nature of Loans given to Subsidiary:

(Rs. in lakh)

Name of the Company Relationship As at 31st As at 31st Maximum

March, 2010 March,2009 Balance during

the year

Reliance Vantage Retail Limited. Subsidiary Company - 3,788.92 3,794.92

Notes:

a Loans and Advances shown above, to Subsidiary fall under the category of Loans and Advances in nature of Loans

where there is no repayment schedule and are re-payable on demand.

b All the above loans and advances are interest free.

c Loans to employees as per Companys policy are not considered.

d All the above Loan and Advances are to the company under the same management.

SCHEDULE N (Contd.)







Mumbai




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I. Registration Details:

Registration No. U 5 1 9 0 9 M H 2 0 0 6 P L C 1 6 6 1 6 3

Balance Sheet Date: 3 1 - 0 3 - 2 0 1 0 State Code 1 1

II. Capital raised during the year (Rupees in Thousand):

Public Issue: N I L Rights Issue: N I L

Bonus Issue: N I L Private Placement: N I L

Share Application Money: N I L

III. Position of mobilisation and deployment of funds (Rupees in Thousand):

Total Liabilities: 1 5 2 4 9 6 6 1 Total Assets: 1 5 2 4 9 6 6 1

Sources of Funds:

Paid up Capital: 5 0 0 Net Fixed Assets: 1 2 2 4 4 6 2 9

Reserves and Surplus: N I L Investments: 5 0 5 5 3 2

Secured Loans: 8 0 3 Current Assets: 1 0 4 0 5 0 6

Current Liabilities 8 2 8 0 2 0 Deferred Tax Asset 4 9 0 6 5 5

Unsecured Loans: 1 4 4 2 0 3 3 8 Profit and Loss Account: 9 6 8 3 3 9

IV. Performance of the Company: (Amount in Rs. Thousand)

Net Turnover: 5 1 6 3 4 2 9 Total Expenditure: 5 6 6 5 5 7 4

Profit / (Loss) before tax: ( 6 7 6 4 7 2 ) Profit / (Loss) after tax: ( 4 2 5 1 0 6 )

Earnings per Share in Rs:

- Basic ( 8 5 0 2 . 1 2 ) Dividend Rate: N I L

- Diluted ( 8 5 0 2 . 1 2 )

V. Generic Names of principal products of the Company:

Item Code number N A

Product Description N A

Additional information as required under Part IV of Schedule VI to the Companies Act, 1956

Balance Sheet Abstract and Companys General Business Profile


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Statement Pursuant to Section 212 of the Companies Act, 1956, relating to CompanysInterest in Subsidiary Company for the financial year 2009-2010

Sr. Name of Subsidiary Company Reliance Vantage

No. Retail Limited

1 The financial year of the Subsidiary Company ended on 31st March, 2010

2 Date from which it became Subsidiary Company 21st January, 2008

3 a. Number of shares held by Reliance Hypermart Limited 5,60,000 Equity shares of the

with its nominees in the subsidiary at the end of the financial year. face value of Rs.10 each fully paid-up

b. Extent of interest of holding company at the end of the financial year. 100%

4 The net aggregate amount of the Subsidiary Companys Profit/(Loss)

so far as it concerns the members of the holding Company.

a. Not dealt with in the holding Companys accounts.

i) For the financial year ended 31st March, 2010 Rs.222.12 lakh

ii) For the previous financial years of the subsidiary company s

ince it became the holding Companys subsidiary. (Rs.956.95 lakh)

b. Dealt with in holding companys account:

i) For the financial year ended 31st March, 2010 NIL

ii) For the previous financial years of the subsidiary company since it NIL

became the holding Companys subsidiary.

For and on behalf of the Board of Directors

Raghu Pillai Madhavan Ganesan

Director Director

Place: Mumbai

Date: April 22, 2010

21 reliance hypermart limited

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