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Presented by:Bhawna SikkaNikhil Mansukhani

Renu YadavVandana BhartiBrijmohan ParasharChandan KumarAmrita Mishra

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Reliance Industries Limited is India's largest privatesectorconglomerate company by market value.

Annual turnover ofUS$ 44.6 billion and profit of US$ 3.6 billion forthe fiscal year ending in March 2010.

One of India's private sector Fortune Global 500 companies.

Ranked at 264th position (2009).

It was founded by the Indian industrialist Dhirubhai Ambani in1966.

Ambani has been a pioneer in introducing financial instrumentslike fully convertible debentures to the Indian stock markets.

http://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Private_sectorhttp://en.wikipedia.org/wiki/Private_sectorhttp://en.wikipedia.org/wiki/Conglomerate_(company)http://en.wikipedia.org/wiki/US$http://en.wikipedia.org/wiki/Fortune_Global_500http://en.wikipedia.org/wiki/Dhirubhai_Ambanihttp://en.wikipedia.org/wiki/Dhirubhai_Ambanihttp://en.wikipedia.org/wiki/Dhirubhai_Ambanihttp://en.wikipedia.org/wiki/Dhirubhai_Ambanihttp://en.wikipedia.org/wiki/Fortune_Global_500http://en.wikipedia.org/wiki/US$http://en.wikipedia.org/wiki/Conglomerate_(company)http://en.wikipedia.org/wiki/Private_sectorhttp://en.wikipedia.org/wiki/Private_sectorhttp://en.wikipedia.org/wiki/India

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Reliance Petroleum Limited was set up by Reliance IndustriesLimited (RIL).

One of India's largest private sector companies basedin Mumbai.

Currently, RPL is subsidiary of RIL, and has interests inthe downstream oil business.

RPL also benefits from a strategic alliance with Chevron IndiaHoldings Pte Limited, Singapore, a wholly owned subsidiaryofChevron Corporation USA (Chevron), which currently holdsa 5% equity stake in the Company.

http://en.wikipedia.org/wiki/Reliance_Industries_Limitedhttp://en.wikipedia.org/wiki/Reliance_Industries_Limitedhttp://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/wiki/Downstream_(oil_industry)http://en.wikipedia.org/wiki/Singaporehttp://en.wikipedia.org/wiki/Chevron_Corporationhttp://en.wikipedia.org/wiki/Chevron_Corporationhttp://en.wikipedia.org/wiki/Singaporehttp://en.wikipedia.org/wiki/Downstream_(oil_industry)http://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/wiki/Reliance_Industries_Limitedhttp://en.wikipedia.org/wiki/Reliance_Industries_Limited

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IPO: September 1993(for Jamnagar refinery expansion plan)

Offering Details:

TOCD issued of FV Rs. 60

TOCD breakup

2 Equity shares of Rs. 10 each

Rs. 40 Non Convertibledebentures with warrants (detachable)

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Analyst views: Trading Value of the debenture - Rs. 48 and

the probable warrant value Rs. 5 each in themarket

Against shares worth 40 in the case ofsurrender

Result of Analysis:

No investor will turn up to surrender theTOCDs

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Higher conversion price for warrants(Rs.13.3)in comparison to MV of Rs. 20

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Conversion of debenture to equity resulted inreduction of debt : equity ratio (lowering)

RPL exercised the call provision andredeemed the convertible portion of O/STOCDs. Again for reduction of Debt Equityratio

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TOCD Conversion to Equity Shares

OR Redemption

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Yield earned by an investor who exercisedthe option of converting NCD plus warrantsinto three equity shares

sold them in September, 2002.

Present value=Rs. 40

69=40{1+(YTM/100)}9

Therefore, YTM= 6.25%

September,1993

(NCD+ 2

warrants)

September, 2002Sold for RS.69

(23*3)

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60 = 54/{1+(YTM/100)}5+20/{1+(YTM/100)}6 +30/{1+(YTM/100)}7

+30/{1+(YTM/100)}8

Therefore, YTM= 13.89%

Sept,1993

(40+20)

May, 199844(2 equity

shares)+

10(2 warrants)

Nov,1999Equityshare=Rs.20

Nov, 2000Equity share=

Rs.30

Nov, 2001Equity

Share=Rs.

30

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60= 44/{1+(YTM/100)}5 +50/{1+(YTM/100)}6 +50/{1+(YTM/100)}7 +30/{1+(YTM/100)}8

Therefore, YTM = 17.89%

Sept,1993(40+20)

May,1998

(Rs.44)

Nov,1999

(Rs. 50)

Nov, 2000(Rs. 50)

Nov,2001

(Rs. 30)

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58 = 50/{1+(YTM/100)}1 + 50/{1+(YTM/100)}2 + 30/{1+(YTM/100)}3

Therefore, YTM = 60.18%

April, 1998(Rs. 58)

Nov, 1999(Rs. 50)

Nov, 2000(Rs. 50)

Nov,2001

(Rs. 30)