Reliance Industries

India Equity Research | Oil & Gas

October 12, 2018
Company Update Emkay
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Refer to important disclosures at the end of this report

CMP Target Price

Chugging along Rs 1,127

as of (October 12, 2018)
Rs 1,290 (▼)
12 months

Rating Upside
BUY (■) 14.5 %

Change in Estimates
 We expect RIL to continue its steady performance, supported by petchem, while the
refinery segment should be driven by the upcoming petcoke gasification project and likely EPS Chg FY19E/FY20E (%) (10)/(1)
GRM push from IMO norms, potentially from next fiscal. Target Price change (%) (1)

 We estimate largely flat consol. EBITDA/PAT qoq in Q2FY19. While we expect refining Target Period (Months) 12
earnings to be impacted, building 7% lower GRM qoq at US$9.8/bbl, partially offset by a Previous Reco BUY
weaker rupee, petchem would be stable with upside risk from Nagothane ethane Emkay vs Consensus
connectivity and higher volumes. Jio and Retail earnings should continue to grow. EPS Estimates
 Current petchem margins are driven by strong PX/PTA spreads from tight supply and FY19E FY20E
steady demand scenario, which is able to offset the weakness in MEG and polymers. With Emkay 64.8 82.9
LNG prices at over US$10/mmbtu and petcoke prices under US$120/bbl, petcoke gasification Consensus 61.5 65.6
economics are favorable, and we estimate more than US$2/bbl of incremental EBITDA.
Mean Consensus TP (12M) Rs 1,242
 Capex run-rate is a key monitorable, with Q1 figure of Rs333bn seemingly higher. While Stock Details
the depreciation of the rupee would add to it, we have built in over Rs1trn capex for FY19, Bloomberg Code RIL IN
which if lower would be a positive trigger. Reducing TP slightly to Rs1,290. Maintain Buy.
Face Value (Rs) 10
Shares outstanding (mn) 6,338
 Integrated petchem model keeps overall margins stable: We note that while PP, PVC,
52 Week H/L 1,329 / 841
MEG and polyester margins witnessed some decline qoq in Q2FY19, the same was more
than offset by a jump in PX and PTA spread. Post October pricing, this trend continued as M Cap (Rs bn/USD bn) 7,141 / 96.94
PX/PTA went up further and despite the weakness in all other products. Intermediaries are Daily Avg Volume (nos.) 10,005,640
supported by tight supplies. RIL’s integrated model continues to protect its overall margins. Daily Avg Turnover (US$ mn) 160.6
 Current LNG-petcoke prices imply favorable gasification economics: Current LNG Shareholding Pattern Jun '18
price of over US$10/mmbtu and petcoke price of US$110-120/mt paint a favorable picture
Promoters 46.2%
for the petcoke gasification project, which is soon expected to stabilize fully. We believe a
US$2/bbl incremental EBITDA is doable, which implies an earnings impact of Rs70bn+. FIIs 23.9%
Further, CY19 onward, the IMO impact is likely, with total GRM impact of US$2/bbl based DIIs 11.2%
on diesel forwards. Public and Others 18.7%

 Jio and Retail to continue growing; capex run-rate remains a key factor: We expect Price Performance
Jio subscriber addition of 15% qoq at 248mn by Q2FY19-end and estimate EBITDA of
(%) 1M 3M 6M 12M
Rs35.6bn, up 13% qoq, Retail is also expected to maintain its growth momentum. While
Absolute (10) 4 21 29
the rupee’s depreciation is positive for operating earnings, some impact of higher interest
would be there besides the rise in capex. We have upped our capex estimate for FY19 to Rel. to Nifty (2) 10 21 24
Rs1tr+. Relative price chart
 Maintain Buy with Rs1,290 target price: We cut our FY19 EBITDA/PAT by 5%/10%, 1325 Rs % 40

building the petcoke gasification impact from Q4 (earlier Q3) and slightly lowering our base 1230 30

GRM assumption besides taking higher interest from the depreciation of the rupee. 1135 20

However, our FY20 numbers remain intact although our SOTP valuation is slightly lower
1040 10
at Rs1,290 (Rs1,300) due to an upstream value adjustment and some increase in debt.
945 0
Maintain Buy.
850 -10
Financial Snapshot (Consolidated) Oct-17 Dec-17 Feb-18 Apr-18 Jun-18 Aug-18 Oct-18

Reliance Industries (LHS) Rel to Nifty (RHS)

(Rs mn) FY16 FY17 FY18 FY19E FY20E
Source: Bloomberg
Revenue 2,739,990 3,053,820 3,916,770 6,003,167 6,613,998
This report is solely produced by Emkay Global. The
EBITDA 417,040 461,940 641,760 829,017 1,063,904 following person(s) are responsible for the production
EBITDA Margin (%) 15.2 15.1 16.4 13.8 16.1 of the recommendation:

APAT 250,510 299,410 349,340 383,847 490,688 Sabri Hazarika

EPS (Rs) 42.3 50.6 59.0 64.8 82.9 sabri.hazarika@emkayglobal.com
EPS (% chg) 6.0 19.5 16.7 9.9 27.8 +91-22-66121282
ROE (%) 11.1 12.1 12.5 12.4 14.2 Ankur Chauhan
P/E (x) 26.6 22.3 19.1 17.4 13.6 ankur.chauhan@emkayglobal.com
EV/EBITDA (x) 18.4 17.5 12.9 11.2 8.8 +91-22-66242491
P/BV (x) 2.9 2.5 2.3 2.0 1.8
Source: Company, Emkay Research

Emkay Research is also available on www.emkayglobal.com, Bloomberg EMKAY<GO>, Reuters and DOWJONES. DBS Bank Ltd, DBS Vickers Securities (Singapore) Pte Ltd,its respective connected and associated corporations and affiliates are the distributors of the research reports, please refer
to the last page of the report on Restrictions on Distribution. In Singapore, this research report or research analyses may only be distributed to Institutional Investors,Expert Investors or Accredited Investors as defined in the Securities and Futures Act, Chapter 289 of Singapore

ED: ANISH MATHEW SA: DHANANJAY SINHA

 Reliance Industries (RIL IN) India Equity Research | Company Update

Exhibit 1: Petcoke Gasification Economics Sensitivity (US$ mn)

Brent Price ($/bbl) 70 75 80 85 90 95 100
Currency (Rs./$) 73.0 73.0 73.0 73.0 73.0 73.0 73.0
No. Of Gasifiers 10 10 10 10 10 10 10
Syngas Produced/Gasifier (mmscmd) 2.0 2.0 2.0 2.0 2.0 2.0 2.0
Total Syngas Produced (mmscmd) 20 20 20 20 20 20 20
Process Loss 10% 10% 10% 10% 10% 10% 10%
Available Syngas (mmscmd) 18 18 18 18 18 18 18
Refinery LNG to be Replaced (mmscmd) 9 9 9 9 9 9 9
Off-gases to be Replaced in ROGC (mmscmd) 9 9 9 9 9 9 9
LNG Price ($/mmbtu) 7.0 7.5 8.0 8.5 9.0 9.5 10.0
LNG Cost At Jamnagar ($/mmbtu) 9.4 9.9 10.4 10.9 11.4 12.0 12.5
R-LNG Feedstock Cost 1,207 1,273 1,339 1,405 1,471 1,537 1,603
ROGC Off-gas Price ($/mmbtu) - Same As LNG 9.4 9.9 10.4 10.9 11.4 12.0 12.5
Off-gas Feedstock Cost (ROGC Value Add) 1,207 1,273 1,339 1,405 1,471 1,537 1,603
Petcoke Required/Gasifier (mmt) 0.9 0.9 0.9 0.9 0.9 0.9 0.9
Petcoke Required (mmt) 9.0 9.0 9.0 9.0 9.0 9.0 9.0
Captive Petcoke Production (mmt) 6.5 6.5 6.5 6.5 6.5 6.5 6.5
Petcoke Purchase Required (mmt) 2.5 2.5 2.5 2.5 2.5 2.5 2.5
Petcoke Cracks ($/bbl) -55 -57 -59 -61 -64 -66 -68
Petcoke Price ($/mt) 83 99 116 132 143 160 176
Raw Material Petcoke Cost 744 893 1,041 1,190 1,289 1,438 1,587
Gross Savings 1,671 1,654 1,637 1,620 1,652 1,635 1,618
GRM Impact ($/bbl) 3.4 3.3 3.3 3.3 3.3 3.3 3.3
OPEX ($/bbl) 0.7 0.7 0.7 0.7 0.7 0.7 0.7
OPEX ($/mmbtu) 1.5 1.5 1.5 1.5 1.5 1.5 1.5
OPEX 350 350 350 350 350 350 350
Net Savings 1,321 1,304 1,287 1,270 1,302 1,285 1,268
Impact On Refining EBITDA/bbl ($) 2.7 2.6 2.6 2.6 2.6 2.6 2.6
Source: Company, Emkay Research

Exhibit 2: Overall Petchem Margins (Rs/kg) Exhibit 3: Polymer Margins (Rs/kg)

40 80
38.9
38 60 60.6
37.4 58.9
36 36.2 40
34.7 33.6
34 33.9 20
33.0
32 32.1 32.5
0 Oct-18
31.5
Q4FY18
Q2FY17

Q3FY17

Q4FY17

Q1FY18

Q2FY18

Q3FY18

Q1FY19

Q2FY19e

30.6
30
Oct-18
Q2FY17

Q3FY17

Q4FY17

Q1FY18

Q2FY18

Q3FY18

Q4FY18

Q1FY19

Q2FY19e

PP PE PVC
Source: Company, Emkay Research Source: Company, Emkay Research

Exhibit 4: Intermediate Margins (Rs/kg) Exhibit 5: Polyester Margins (Rs/kg)

60 26

40 31.7 22
20.7
36.9
27.1 18
20 15.2
14
0 10
Oct-18
Q2FY17

Q3FY17

Q4FY17

Q1FY18

Q2FY18

Q3FY18

Q4FY18

Q1FY19

Q2FY19e

Q1FY18
Q2FY17

Q3FY17

Q4FY17

Q2FY18

Q3FY18

Q4FY18

Q1FY19

Oct-18
Q2FY19e

PX PTA MEG POY PSF

Source: Company, Emkay Research Source: Company, Emkay Research

Emkay Research is also available on www.emkayglobal.com, Bloomberg EMKAY<GO>, Reuters and DOWJONES. DBS Bank Ltd, DBS Vickers Securities (Singapore) Pte Ltd,its respective connected and associated corporations and affiliates are the distributors of the research reports, please refer to the
last page of the report on Restrictions on Distribution. In Singapore, this research report or research analyses may only be distributed to Institutional Investors,Expert Investors or Accredited Investors as defined in the Securities and Futures Act, Chapter 289 of Singapore

ED: ANISH MATHEW SA: DHANANJAY SINHA October 12, 2018 | 2

 Reliance Industries (RIL IN) India Equity Research | Company Update

Exhibit 6: Jio Subscribers and EBITDA Exhibit 7: Retail Business Earnings

40 36 300 12,000 10,69011,417

35 31 9,510
26 27 250 10,000
30
25 248 200 8,000
20 14 215 6,000 4,870
15 187 150 3,340
4,000 2,430 2,920
10 139
160 100 1,620 2,310
5 109 123 2,000
0 50
0
-5 0 0

Q4FY18
Q2FY17

Q3FY17

Q4FY17

Q1FY18

Q2FY18

Q3FY18

Q1FY19

Q2FY19E
Q4FY17

Q2FY19E
Q1FY18

Q2FY18

Q3FY18

Q4FY18

Q1FY19
Retail EBIT (Rs mn)
Jio EBITDA (Rs bn) Jio Subscribers (mn)
Source: Company, Emkay Research Source: Company, Emkay Research

Exhibit 8: SOTP Valuation

Rs.bn (FY20E, Consol) Method Head Multiple EV EV/sh
Refining EV/EBITDA 373 8.0 2,986 503
Petrochemicals EV/EBITDA 384 8.5 3,265 550
Upstream Oil & Gas DCF-EV/EBITDA 17 14.3 249 42
Organised Retail EV/EBITDA 70 20.0 1,401 236
Others EV/Sales 132 1.0 132 22
Telecom EV/EBITDA 230 9.0 2,072 349
Total 10,105 1,704
Adj. Net Debt (FY19E End) 2,455 414
Equity Value 7,649 1,290
Shares O/S (bn) 5.9
Source: Company, Emkay Research

Exhibit 9: PE based valuation

Rs./sh (Consol.) FY16 FY17 FY18 FY19E FY20E
RIL's Adjusted EPS 42.3 50.6 59.0 64.8 82.9
Target Multiple (x) 15.6
SOTP Target Price 1,290
Source: Company, Emkay Research

Emkay Research is also available on www.emkayglobal.com, Bloomberg EMKAY<GO>, Reuters and DOWJONES. DBS Bank Ltd, DBS Vickers Securities (Singapore) Pte Ltd,its respective connected and associated corporations and affiliates are the distributors of the research reports, please refer to the
last page of the report on Restrictions on Distribution. In Singapore, this research report or research analyses may only be distributed to Institutional Investors,Expert Investors or Accredited Investors as defined in the Securities and Futures Act, Chapter 289 of Singapore

ED: ANISH MATHEW SA: DHANANJAY SINHA October 12, 2018 | 3

 Reliance Industries (RIL IN) India Equity Research | Company Update

Key Financials (Consolidated)

Income Statement
Y/E Mar (Rs mn) FY16 FY17 FY18 FY19E FY20E
Revenue 2,739,990 3,053,820 3,916,770 6,003,167 6,613,998
Expenditure 2,322,950 2,591,880 3,275,010 5,174,150 5,550,094
EBITDA 417,040 461,940 641,760 829,017 1,063,904
Depreciation 115,650 116,460 167,060 207,114 242,202
EBIT 301,390 345,480 474,700 621,904 821,702
Other Income 74,790 94,430 88,620 77,440 78,994
Interest expenses 36,910 38,490 80,520 150,991 199,714
PBT 339,270 401,420 482,800 548,353 700,982
Tax 88,760 102,010 133,460 164,506 210,295
Extraordinary Items 45,740 0 10,870 0 0
Minority Int./Income from Assoc. 0 0 0 0 0
Reported Net Income 296,250 299,410 360,210 383,847 490,688
Adjusted PAT 250,510 299,410 349,340 383,847 490,688

Balance Sheet
Y/E Mar (Rs mn) FY16 FY17 FY18 FY19E FY20E
Equity share capital 29,480 29,590 59,220 59,309 59,398
Reserves & surplus 2,286,080 2,607,500 2,875,840 3,199,807 3,608,059
Net worth 2,315,560 2,637,090 2,935,060 3,259,116 3,667,457
Minority Interest 33,560 29,170 35,390 34,435 32,882
Loan Funds 1,962,240 2,257,630 2,475,150 3,456,721 3,638,327
Net deferred tax liability 204,940 211,980 245,430 278,560 312,352
Total Liabilities 4,516,300 5,135,870 5,691,030 7,028,832 7,651,018
Net block 1,849,100 1,985,260 4,038,850 5,798,620 6,310,696
Investment 840,150 828,990 828,620 765,965 716,598
Current Assets 1,013,750 1,005,400 1,375,040 2,094,268 2,430,081
Cash & bank balance 110,280 30,230 42,550 51,983 179,991
Other Current Assets 61,170 85,350 84,480 129,481 142,656
Current liabilities & Provision 1,473,670 1,932,150 2,421,700 2,565,131 2,750,818
Net current assets (459,920) (926,750) (1,046,660) (470,863) (320,737)
Misc. exp 0 0 0 0 0
Total Assets 4,516,300 5,135,870 5,691,030 7,028,832 7,651,018

Cash Flow
Y/E Mar (Rs mn) FY16 FY17 FY18 FY19E FY20E
PBT (Ex-Other income) (NI+Dep) 264,480 306,990 394,180 470,913 621,988
Other Non-Cash items (28,170) (20,240) (14,110) 0 0
Chg in working cap 570,590 393,820 165,680 (533,234) 11,673
Operating Cashflow 381,340 495,500 714,590 132,986 867,025
Capital expenditure (1,022,520) (1,214,020) (842,500) (1,031,774) (763,629)
Free Cash Flow (641,180) (718,520) (127,910) (898,788) 103,396
Investments (75,500) 11,160 370 62,655 49,367
Other Investing Cash Flow 661,330 445,510 70,610 0 0
Investing Cashflow (361,900) (662,920) (682,900) (891,679) (635,267)
Equity Capital Raised 50 110 29,630 89 89
Loans Taken / (Repaid) 262,860 295,390 217,520 981,571 181,606
Dividend paid (incl tax) (72,590) (530) (39,160) (59,880) (82,436)
Other Financing Cash Flow (185,510) (170,310) (147,480) (2,663) (3,295)
Financing Cashflow (32,100) 86,170 (20,010) 768,126 (103,750)
Net chg in cash (12,660) (81,250) 11,680 9,433 128,008
Opening cash position 125,450 110,280 30,230 42,550 51,983
Closing cash position 110,280 30,230 42,550 51,983 179,991
Source: Company, Emkay Research

Emkay Research is also available on www.emkayglobal.com, Bloomberg EMKAY<GO>, Reuters and DOWJONES. DBS Bank Ltd, DBS Vickers Securities (Singapore) Pte Ltd,its respective connected and associated corporations and affiliates are the distributors of the research reports, please refer to the
last page of the report on Restrictions on Distribution. In Singapore, this research report or research analyses may only be distributed to Institutional Investors,Expert Investors or Accredited Investors as defined in the Securities and Futures Act, Chapter 289 of Singapore

ED: ANISH MATHEW SA: DHANANJAY SINHA October 12, 2018 | 4

 Reliance Industries (RIL IN) India Equity Research | Company Update

Key Ratios
Profitability (%) FY16 FY17 FY18 FY19E FY20E
EBITDA Margin 15.2 15.1 16.4 13.8 16.1
EBIT Margin 11.0 11.3 12.1 10.4 12.4
Effective Tax Rate 26.2 25.4 27.6 30.0 30.0
Net Margin 9.1 9.8 8.9 6.4 7.4
ROCE 8.8 9.1 10.4 11.0 12.3
ROE 11.1 12.1 12.5 12.4 14.2
RoIC 21.8 29.9 23.9 15.1 14.8

Per Share Data (Rs) FY16 FY17 FY18 FY19E FY20E

EPS 42.3 50.6 59.0 64.8 82.9
CEPS 61.8 70.2 87.2 99.8 123.8
BVPS 391.0 445.3 495.6 550.3 619.3
DPS 5.2 5.5 6.0 8.4 11.6

Valuations (x) FY16 FY17 FY18 FY19E FY20E

PER 26.6 22.3 19.1 17.4 13.6
P/CEPS 17.6 15.5 12.5 10.9 8.8
P/BV 2.9 2.5 2.3 2.0 1.8
EV / Sales 2.8 2.6 2.1 1.6 1.4
EV / EBITDA 18.4 17.5 12.9 11.2 8.8
Dividend Yield (%) 0.5 0.5 0.5 0.7 1.0

Gearing Ratio (x) FY16 FY17 FY18 FY19E FY20E

Net Debt/ Equity 0.4 0.5 0.5 0.8 0.7
Net Debt/EBIDTA 2.4 3.0 2.5 3.2 2.6
Working Cap Cycle (days) (76.0) (114.4) (101.5) (31.8) (27.6)

Growth (%) FY16 FY17 FY18 FY19E FY20E

Revenue (27.0) 11.5 28.3 53.3 10.2
EBITDA 11.6 10.8 38.9 29.2 28.3
EBIT 16.7 14.6 37.4 31.0 32.1
PAT 25.3 1.1 20.3 6.6 27.8

Quarterly (Rs mn) Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19

Revenue 685,320 732,560 840,370 911,590 956,778
EBITDA 129,830 137,440 134,250 151,540 151,422
EBITDA Margin (%) 18.9 18.8 16.0 16.6 15.8
PAT 82,650 84,540 86,970 88,200 86,799
EPS (Rs) 14.0 14.3 14.7 14.9 14.7
Source: Company, Emkay Research

Shareholding Pattern (%) Sep-17 Sep-17 Dec-17 Mar-18 Jun-18

Promoters 46.2 46.2 46.2 46.2 46.2
FIIs 23.2 23.0 23.6 23.8 23.9
DIIs 11.2 11.3 11.1 10.9 11.2
Public and Others 19.4 19.5 19.1 19.1 18.7
Source: Capitaline

Emkay Research is also available on www.emkayglobal.com, Bloomberg EMKAY<GO>, Reuters and DOWJONES. DBS Bank Ltd, DBS Vickers Securities (Singapore) Pte Ltd,its respective connected and associated corporations and affiliates are the distributors of the research reports, please refer to the
last page of the report on Restrictions on Distribution. In Singapore, this research report or research analyses may only be distributed to Institutional Investors,Expert Investors or Accredited Investors as defined in the Securities and Futures Act, Chapter 289 of Singapore

ED: ANISH MATHEW SA: DHANANJAY SINHA October 12, 2018 | 5

 Reliance Industries (RIL IN) India Equity Research | Company Update

RECOMMENDATION HISTORY TABLE RECOMMENDATION HISTORY CHART

Closing Period
Date TP Rating Analyst BUY Hold Sell
Price (months) Accumulate Reduce Price
Target Price
4-Sep-18 1,242 1,300 12m Buy Sabri Hazarika 1325
30-Jul-18 1,151 1,300 12m Buy Sabri Hazarika
1148
13-Jul-18 1,100 965 12m Hold Sabri Hazarika
971
8-Jun-18 984 965 12m Hold Sabri Hazarika
794
30-Apr-18 963 965 12m Accumulate Sabri Hazarika
19-Jan-18 931 980 12m Accumulate Sabri Hazarika 617

14-Oct-17 876 843 12m Hold Dhaval Joshi 440

9-Apr-17

6-Apr-18
7-Oct-17

4-Oct-18
12-Apr-16
14-Oct-15

10-Oct-16
21-Sep-17 841 843 12m Hold Dhaval Joshi
21-Jul-17 793 759 12m Buy Dhaval Joshi
25-Apr-17 716 759 12m Buy Dhaval Joshi Source: Bloomberg, Company, Emkay Research
19-Apr-17 684 759 12m Buy Dhaval Joshi
17-Jan-17 521 580 12m Buy Dhaval Joshi
21-Oct-16 532 580 12m Buy Dhaval Joshi
18-Jul-16 503 580 12m Buy Dhaval Joshi
2-Jun-16 478 580 12m Buy Dhaval Joshi
23-Apr-16 519 580 12m Buy Dhaval Joshi
20-Jan-16 502 570 12m Buy Dhaval Joshi
26-Nov-15 494 570 12m Buy Dhaval Joshi
19-Oct-15 482 570 12m Buy Dhaval Joshi
Source: Company, Emkay Research

Emkay Research is also available on www.emkayglobal.com, Bloomberg EMKAY<GO>, Reuters and DOWJONES. DBS Bank Ltd, DBS Vickers Securities (Singapore) Pte Ltd,its respective connected and associated corporations and affiliates are the distributors of the research reports, please refer to the
last page of the report on Restrictions on Distribution. In Singapore, this research report or research analyses may only be distributed to Institutional Investors,Expert Investors or Accredited Investors as defined in the Securities and Futures Act, Chapter 289 of Singapore

ED: ANISH MATHEW SA: DHANANJAY SINHA October 12, 2018 | 6

 Reliance Industries (RIL IN) India Equity Research | Company Update

Emkay Rating Distribution

BUY Expected total return (%) (Stock price appreciation and dividend yield) of over 25% within the next 12-18 months.
ACCUMULATE Expected total return (%) (Stock price appreciation and dividend yield) of over 10% within the next 12-18 months.
HOLD Expected total return (%) (Stock price appreciation and dividend yield) of upto 10% within the next 12-18 months.
REDUCE Expected total return (%) (Stock price depreciation) of upto (-) 10% within the next 12-18 months.
SELL The stock is believed to underperform the broad market indices or its related universe within the next 12-18 months.

Completed Date: 13 Oct 2018 00:25:44 (SGT)

Dissemination Date: 13 Oct 2018 00:26:44 (SGT)

Sources for all charts and tables are Emkay Research unless otherwise specified.

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 Please contact the primary analyst for valuation methodologies and assumptions associated with the covered companies or price targets

Disclaimer for U.S. persons only: This research report is a product of Emkay Global Financial Services Limited (Emkay), which is the employer of the
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Emkay Research is also available on www.emkayglobal.com, Bloomberg EMKAY<GO>, Reuters and DOWJONES. DBS Bank Ltd, DBS Vickers Securities (Singapore) Pte Ltd,its respective connected and associated corporations and affiliates are the distributors of the research reports, please refer to the
last page of the report on Restrictions on Distribution. In Singapore, this research report or research analyses may only be distributed to Institutional Investors,Expert Investors or Accredited Investors as defined in the Securities and Futures Act, Chapter 289 of Singapore

ED: ANISH MATHEW SA: DHANANJAY SINHA October 12, 2018 | 7

 Reliance Industries (RIL IN) India Equity Research | Company Update

GENERAL DISCLOSURE/DISCLAIMER BY DBS BANK LTD AS DISTRIBUTOR OF THE RESEARCH REPORT

This report is solely intended for the clients of DBS Bank Ltd,its respective connected and associated corporations and affiliates only and no part of this
document may be (i) copied, photocopied or duplicated in any form or by any means or (ii) redistributed without the prior written consent of DBS Bank Ltd.

The research set out in this report is based on information obtained from sources believed to be reliable, but we (which collectively refers to DBS Bank
Ltd, its respective connected and associated corporations, affiliates and their respective directors, officers, employees and agents (collectively, the “DBS
Group”) have not conducted due diligence on any of the companies, verified any information or sources or taken into account any other factors which we
may consider to be relevant or appropriate in preparing the research. Accordingly, we do not make any representation or warranty as to the accuracy,
completeness or correctness of the research set out in this report. Opinions expressed are subject to change without notice. This research is prepared for
general circulation. Any recommendation contained in this document does not have regard to the specific investment objectives, financial situation and
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mentioned in this document. The DBS Group, may have positions in, and may effect transactions in securities mentioned herein and may also perform or
seek to perform broking, investment banking and other banking services for these companies. Any valuations, opinions, estimates, forecasts, ratings or
risk assessments herein constitutes a judgment as of the date of this report, and there can be no assurance that future results or events will be consistent
with any such valuations, opinions, estimates, forecasts, ratings or risk assessments. The information in this document is subject to change without notice,
its accuracy is not guaranteed, it may be incomplete or condensed, it may not contain all material information concerning the company (or companies)
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authorized by any regulatory authority in Singapore, Hong Kong or elsewhere. There is no planned schedule or frequency for updating research publication
relating to any issuer.

The valuations, opinions, estimates, forecasts, ratings or risk assessments described in this report were based upon a number of estimates and
assumptions and are inherently subject to significant uncertainties and contingencies. It can be expected that one or more of the estimates on which the
valuations, opinions, estimates, forecasts, ratings or risk assessments were based will not materialize or will vary significantly from actual results.
Therefore, the inclusion of the valuations, opinions, estimates, forecasts, ratings or risk assessments described herein IS NOT TO BE RELIED UPON as
a representation and/or warranty by the DBS Group (and/or any persons associated with the aforesaid entities), that: (a) such valuations, opinions,
estimates, forecasts, ratings or risk assessments or their underlying assumptions will be achieved, and (b) there is any assurance that future results or
events will be consistent with any such valuations, opinions, estimates, forecasts, ratings or risk assessments stated therein. Please contact the primary
analyst for valuation methodologies and assumptions associated with the covered companies or price targets. Any assumptions made in this report that
refers to commodities, are for the purposes of making forecasts for the company (or companies) mentioned herein. They are not to be construed as
recommendations to trade in the physical commodity or in the futures contract relating to the commodity referred to in this report.

DBSVUSA, a US-registered broker-dealer, does not have its own investment banking or research department, has not participated in any public offering
of securities as a manager or co-manager or in any other investment banking transaction in the past twelve months and does not engage in market-
making.

ANALYST CERTIFICATION BY EMKAY GLOBAL FINANCIAL SERVICES LIMITED (EGFSL)

The research analyst(s) primarily responsible for the content of this research report, in part or in whole, certifies that the views about the companies and
their securities expressed in this report accurately reflect his/her personal views. The analyst(s) also certifies that no part of his/her compensation was, is,
or will be, directly or indirectly, related to specific recommendations or views expressed in the report. The research analyst (s) primarily responsible of the
content of this research report, in part or in whole, certifies that he or his associate 1 does not serve as an officer, director or employee of the issuer or the
new listing applicant (which includes in the case of a real estate investment trust, an officer of the management company of the real estate investment
trust; and in the case of any other entity, an officer or its equivalent counterparty of the entity who is responsible for the management of the issuer or the
new listing applicant). The research analyst(s) primarily responsible for the content of this research report or his associate does not have financial interests2
in relation to an issuer or a new listing applicant that the analyst reviews. EGFSL has procedures in place to eliminate, avoid and manage any potential
conflicts of interests that may arise in connection with the production of research reports. The research analyst(s) responsible for this report operates as
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specific investment banking function of the EGFSL.

1
An associate is defined as (i) the spouse, or any minor child (natural or adopted) or minor step-child, of the analyst; (ii) the trustee of a trust of which the analyst, his spouse,
minor child (natural or adopted) or minor step-child, is a beneficiary or discretionary object; or (iii) another person accustomed or obliged to act in accordance with the directions
or instructions of the analyst.
2
Financial interest is defined as interest that are commonly known financial interest, such as investment in the securities in respect of an issuer or a new listing applicant, or
financial accommodation arrangement between the issuer or the new listing applicant and the firm or analysis. This term does not include commercial lending conducted at the
arm’s length, or investments in any collective investment scheme other than an issuer or new listing applicant notwithstanding the fact that the scheme has investments in
securities in respect of an issuer or a new listing applicant.

Emkay Research is also available on www.emkayglobal.com, Bloomberg EMKAY<GO>, Reuters and DOWJONES. DBS Bank Ltd, DBS Vickers Securities (Singapore) Pte Ltd,its respective connected and associated corporations and affiliates are the distributors of the research reports, please refer to the
last page of the report on Restrictions on Distribution. In Singapore, this research report or research analyses may only be distributed to Institutional Investors,Expert Investors or Accredited Investors as defined in the Securities and Futures Act, Chapter 289 of Singapore

ED: ANISH MATHEW SA: DHANANJAY SINHA October 12, 2018 | 8

 Reliance Industries (RIL IN) India Equity Research | Company Update

COMPANY-SPECIFIC / REGULATORY DISCLOSURES BY EMKAY GLOBAL FINANCIAL SERVICES LIMITED (EGFSL):

Disclosures by Emkay Global Financial Services Limited (Research Entity) and its Research Analyst under SEBI (Research Analyst) Regulations, 2014
with reference to the subject company(s) covered in this report-:

1. EGFSL, its subsidiaries and/or other affiliates do not have a proprietary position in the securities recommended in this report as of October 12,
2018
2. EGFSL, and/or Research Analyst does not market make in equity securities of the issuer(s) or company(ies) mentioned in this Research Report
Disclosure of previous investment recommendation produced:
3. EGFSL may have published other investment recommendations in respect of the same securities / instruments recommended in this research
report during the preceding 12 months. Please contact the primary analyst listed in the first page of this report to view previous investment
recommendations published by EGFSL in the preceding 12 months.
4. EGFSL , its subsidiaries and/or other affiliates and Research Analyst or his/her relative’s does not have any material conflict of interest in the
securities recommended in this report as of October 12, 2018.
5. EGFSL, its subsidiaries and/or other affiliates and Research Analyst or his/her relative’s does not have actual/beneficial ownership of 1% or more
securities of the subject company at the end of the month immediately preceding the October 12, 2018
6. EGFSL, its subsidiaries and/or other affiliates and Research Analyst have not received any compensation in whatever form including
compensation for investment banking or merchant banking or brokerage services or for products or services other than investment banking or
merchant banking or brokerage services from securities recommended in this report (subject company) in the past 12 months.
7. EGFSL, its subsidiaries and/or other affiliates and/or and Research Analyst have not received any compensation or other benefits from securities
recommended in this report (subject company) or third party in connection with the research report.
8. Securities recommended in this report (Subject Company) has not been client of EGFSL, its subsidiaries and/or other affiliates and/or and
Research Analyst during twelve months preceding the October 12, 2018

Emkay Research is also available on www.emkayglobal.com, Bloomberg EMKAY<GO>, Reuters and DOWJONES. DBS Bank Ltd, DBS Vickers Securities (Singapore) Pte Ltd,its respective connected and associated corporations and affiliates are the distributors of the research reports, please refer to the
last page of the report on Restrictions on Distribution. In Singapore, this research report or research analyses may only be distributed to Institutional Investors,Expert Investors or Accredited Investors as defined in the Securities and Futures Act, Chapter 289 of Singapore

ED: ANISH MATHEW SA: DHANANJAY SINHA October 12, 2018 | 9

 Reliance Industries (RIL IN) India Equity Research | Company Update

COMPANY-SPECIFIC / REGULATORY DISCLOSURES BY DBS BANK LTD AS DISTRIBUTOR OF THE RESEARCH REPORT
1. DBS Bank Ltd., DBS HK, DBS Vickers Securities (Singapore) Pte Ltd (“DBSVS”) or their subsidiaries and/or other affiliates do not have a proprietary
position in the securities recommended in this report as of 30 Apr 2018.

2. Neither DBS Bank Ltd nor DBS HK market makes in equity securities of the issuer(s) or company(ies) mentioned in this Research Report.

Compensation for investment banking services:

3. DBSVUSA, does not have its own investment banking or research department, nor has it participated in any public offering of securities as a manager
or co-manager or in any other investment banking transaction in the past twelve months. Any US persons wishing to obtain further information, including
any clarification on disclosures in this disclaimer, or to effect a transaction in any security discussed in this document should contact DBSVUSA
exclusively.

Disclosure of previous investment recommendation produced:

4. DBS Bank Ltd. DBS Vickers Securities (Singapore) Pte Ltd (“DBSVS”), their subsidiaries and/or other affiliates may have published other investment
recommendations in respect of the same securities / instruments recommended in this research report during the preceding 12 months. Please contact
the primary analyst listed in the first page of this report to view previous investment recommendations published by DBS Bank Ltd. DBS Vickers Securities
(Singapore) Pte Ltd (“DBSVS”), their subsidiaries and/or other affiliates in the preceding 12 months.

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This report is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or
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This report is disseminated in the United Kingdom by DBS Vickers Securities (UK) Ltd, ("DBSVUK"). DBSVUK is authorised
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In respect of the United Kingdom, this report is solely intended for the clients of DBSVUK, its respective connected and
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This report is provided by DBS Bank Ltd (Company Regn. No. 196800306E) which is an Exempt Financial Adviser as defined
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DBSVUSA did not participate in its preparation. The research analyst(s) named on this report are not registered as research
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Emkay Research is also available on www.emkayglobal.com, Bloomberg EMKAY<GO>, Reuters and DOWJONES. DBS Bank Ltd, DBS Vickers Securities (Singapore) Pte Ltd,its respective connected and associated corporations and affiliates are the distributors of the research reports, please refer to the
last page of the report on Restrictions on Distribution. In Singapore, this research report or research analyses may only be distributed to Institutional Investors,Expert Investors or Accredited Investors as defined in the Securities and Futures Act, Chapter 289 of Singapore

ED: ANISH MATHEW SA: DHANANJAY SINHA October 12, 2018| 10

 Reliance Industries (RIL IN) India Equity Research | Company Update

SINGAPORE
DBS Bank Ltd
Contact: Janice Chua
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Emkay Research is also available on www.emkayglobal.com, Bloomberg EMKAY<GO>, Reuters and DOWJONES. DBS Bank Ltd, DBS Vickers Securities (Singapore) Pte Ltd,its respective connected and associated corporations and affiliates are the distributors of the research reports, please refer to the
last page of the report on Restrictions on Distribution. In Singapore, this research report or research analyses may only be distributed to Institutional Investors,Expert Investors or Accredited Investors as defined in the Securities and Futures Act, Chapter 289 of Singapore

ED: ANISH MATHEW SA: DHANANJAY SINHA October 12, 2018| 11

 Reliance Industries (RIL IN) India Equity Research | Company Update

Sabri Hazarika
sabri.hazarika@emkayglobal.com
+91-22-66121282

Emkay Research is also available on www.emkayglobal.com, Bloomberg EMKAY<GO>, Reuters and DOWJONES. DBS Bank Ltd, DBS Vickers Securities (Singapore) Pte Ltd,its respective connected and associated corporations and affiliates are the distributors of the research reports, please refer to the
last page of the report on Restrictions on Distribution. In Singapore, this research report or research analyses may only be distributed to Institutional Investors,Expert Investors or Accredited Investors as defined in the Securities and Futures Act, Chapter 289 of Singapore

ED: ANISH MATHEW SA: DHANANJAY SINHA October 12, 2018| 12