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CREDIT NOTE ON RELIANCE CAPITAL LIMITED

Background and Business Description

Reliance Capital,is a part of the Reliance Group.It is one of India's leading
and amongst most valuable financial services and ranks among the top 4
private sector financial services and banking companies,in terms of net
worth.It has interests in asset management,mutual funds,portfolio
management services,pension funds,life and general insurance,private
equity and proprietary investments,stock broking and depository
services,investment banking,wealth management,home and commercial
finance,financial products distribution,venture capital,exchanges,asset
reconstruction and other activities in financial services.
The Company recognises the importance of two-way communication with
shareholders and of giving a balanced report of results and progress and
responds to questions and issues raised in a timely and consistent
manner.Shareholders seeking information may contact the Company
directly throughout the year.They also have an opportunity to ask
questions in person at the Annual General Meeting.Shareholders can
contact the Company via dedicated shareholders contact points as provided
in this report or through any of Investor Service Centers of the Companys
Registrars and Transfer Agents spread in more than 84 cities across
India,details of which are available on the Companys website.

Reliance Capitals share holders consists of Promoters,Foreign institutional
investors,Domestic institutional investors and other companies.Out of
these major shares are held by Promoters:
Share Holder's Name
Number of
Shares
% Share
Holding
Promoters 132982272 54.14%
Foreign Institutions 47982718 19.53%
General Public 41925880 17.07%
Financial Institutions 11318776 4.61%
Other Companies 7567622 3.08%
Banks Mutual Funds 1803022 0.73%
Foreign NRI 1320537 0.54%
Central Govt 76584 0.03%

Reliance Capital Limited (RCL) was incorporated in FY1986 at Ahmedabad
in Gujarat as Reliance Capital & Finance Trust Limited.The name RCL came
into effect from January 5, 1995.In FY2002,RCL shifted its registered office
to Jamnagar before it finally moved to Mumbai,in FY2006.RCL entered the
Capital Market with a maiden public issue in FY1990 and in subsequent
years tapped the capital market through rights issue and public issues.
RCL has interests in asset management and mutual funds; life and general
insurance; commercial finance; equities and commodities broking; wealth
management services; distribution of financial products; private equity;
asset reconstruction; proprietary investments and other activities in
financial services.
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Market, Market Position and Competition

The continued tensions at the global flashpoints with supply-demand
Economic activities in India in FY2012 remained weak due to both domestic
and global factors.The slowdown in the global growth along with continued
recession in the Euro zone hurt sentiment.It has affected all the financial
services spanning from insurance to capital markets,banking to foreign
direct investments (FDI) and from mutual funds to private equity (PE)
investments.Thus the demand for the financial products has decreased
considerably on the other hand there are many companies existing in the
market with similar type of financial products/ solutions which increases
the overall supply with respect to demand.

RCL has positioned itself as a one stop solution for most of the financial
products.The distribution business of Reliance Capital,known as Reliance
Money,is a comprehensive financial services and solutions
provider,providing customers with access to mutual funds,life and general
insurance products,money transfer,currency exchange,loans,gold coins and
premium products.It has a pan-India distribution network of over 6,200
outlets.Commercial Finance Business offers a wide range of products which
include home loans,loans against property,SME loans,vehicle loans,loans
for construction equipment,and Infrastructure financing.

Reliance Mutual Fund (RMF) maintained its position amongst the top asset
managers in the country with a market share of 12 percent.Reliance Life
Insurance (RLI) is amongst the leading private sector life insurers with a
market share of 5 percent in the private sector.Reliance General Insurance
(RGI) is amongst the leading private sector general insurance companies in
India with a market share of over 7 percent.Broking business consists of
Reliance Securities,one of the leading retail broking houses in India,and
provides customers with access to equities,options and futures
products,wealth management,portfolio management services and mutual
funds.

The Companys main competitors are Indian nonbanking financial
companies,commercial banks,life and non-life insurance companies,both in
the public and private sector,mutual funds,broking houses,mortgage
lenders,depository participants and other financial services providers.The
Companys strong brand image,wide distribution network,diversified
product offering and depth of management place it in a strong position to
deal with competition effectively.

RCL has submitted an application for a banking license with the Reserve
Bank of India in June 2013.It intend to partner with Sumitomo Mitsui Trust
Bank and Nippon Life Insurance,two leading financial institutions from
Japan,in this endeavour.The foreign partners propose to take between 4 - 5
percent stake each in the proposed new bank,subject to necessary
regulatory approvals.Both partners have vast experience in the financial
services businesses in Asia,and they are extremely happy to partner with
RCL for the proposed new bank.