The Directors are pleased to present the 37th Annual Report and the audited accounts for the

financial year ended March 31, 2011. Financial Results The financial performance of the Company, for the year ended March 31, 2011 is summarised below: 2010-2011 Rs. crore $ Mn* Profit before Depreciation, Interest & Tax Less: Interest Depreciation Less: 16,241.33 41,177.44 2,327.62 9,234 522 33,041.18 1,997.21 13,477.01 7,359 445 2009-2010 Rs. crore $ Mn*

Transfer from 2,633.75 13,607.58 25,242.24 3,051 2,980.48 10,496.53 2,338 5,661 20,547.44 4,576

Revaluation Reserve Profit before Tax Less: Provision for Current Taxation Provision for Deferred Tax Profit after Tax Add: Balance in Profit and Loss Account Amount Available for Appropriation Appropriation: General Reserve

4,320.44 635.50 20,286.30

969 143 4,549

3,111.77 1,200.00

693 267

16,235.67 3,616

4,999.45 25,285.75

1,114 5,663

5,384.19 1,199 21,619.86 4,815

16,000.00 2,384.99 386.90 6,513.86 25,285.75

3,588 535 87 1,453 5,663

14,000.00 3,118 189.50 2,084.67 346.24 42 464 77

Debenture Redemption Reserve Dividend on Equity Shares Tax on Dividend Balance carried to Balance Sheet

4,999.45 1,114 21,619.86 4,815

* 1 $ = Rs. 44.595 Exchange Rate as on March 31, 2011 (1 $ = Rs. 44.90 as on March 31, 2010) Results of Operations The first full year of operations, after commissioning of the Companys two large scale projects namely KG D6 and SEZ refinery at Jamnagar, resulted in a record performance during the financial year under review. - Turnover increased by 29% to Rs. 2,58,651 crore ($ 58.0 billion) - Exports increased by 33% to Rs. 1,46,667 crore ($ 32.9 billion) - PBDIT increased by 25% and achieved a record level of Rs.41,178 crore ($ 9.2 billion) - Profit Before Tax increased by 23% to Rs. 25,242 crore ($ 5.7 billion) - Cash Profit increased by 24% to Rs. 34,530 crore ($ 7.7 billion) - Net Profit increased by 25% to Rs. 20,286 crore ($ 4.5 billion) - Gross Refining Margin at $ 8.4 /bbl for the year ended March 31, 2011 The Company is one of Indias largest contributors to the national exchequer primarily by way of payment of taxes and duties to various government agencies. During the year, a total of Rs. 28,719 crore ($ 6.4 billion) was paid in the form of various taxes and duties. Dividend Your Directors have recommended a dividend of Rs. 8/- per Equity Share (last year Rs. 7/- per Equity Share) for the financial year ended March 31, 2011, amounting to Rs. 2772 crore (inclusive of tax of Rs. 387 crore) one of the highest ever payout by any private sector domestic company. The dividend will be paid to members whose names appear in the Register of Members as on May 9, 2011; in respect of shares held in dematerialised form, it will be paid to members whose names are furnished by National Securities Depository Limited and Central Depository Services (India) Limited, as beneficial owners. The dividend payout for the year under review has been formulated in accordance with the Companys policy to pay sustainable dividend linked to long term growth objectives of the Company to be met by internal cash accruals and the shareholders aspirations. Credit Rating The Company continues to have the highest domestic credit ratings of AAA from CRISIL and Fitch. Moodys and S&P have reaffirmed investment grade ratings for international debt of the Company, as Baa2 and BBB, respectively. Its continued Balance Sheet strengthning in financial year 2010-11, resulted in Moodys, Fitch and S&P recently upgrading their outlook for the Company from Stable to Positive. The Companys international rating from S&P is higher than the countrys sovereign

rating. Strong credit ratings by leading international agencies reflect the Companys financial discipline and prudence. Managements Discussion and Analysis Report Managements Discussion and Analysis report for the year under review, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges in India, is presented in a separate section forming part of the Annual Report. The Company has entered into various joint ventures, partnerships and contracts in the area of oil and gas, refining and petrochemicals businesses. While benefits from such contracts will accrue in future years, their progress is periodically monitored. In line with its aspirations of ongoing growth, Reliance is investing its resources in core business across the integrated energy chain. While doing so, the Company is also taking the initiative of investing in new technologies and businesses that help meet changing aspirations of millions of Indian consumers. These strategies and initiatives are aimed at ensuring that Reliance delivers long- term sustainable growth and creates unprecedented value for all its stakeholders. Some of the major events of the year include the following: - RIL-BP alliance: RIL has entered into a strategic partnership with BP and signed the relationship framework and transactional agreements. The partnership across the full value chain comprises BP taking a 30% stake in 23 oil and gas production sharing contracts that Reliance operates in India, including the producing KG-D6 block. The two companies will also form a 50:50 joint venture for the sourcing and marketing of gas in India and will endeavour to accelerate the creation of infrastructure for receiving, transporting and marketing of natural gas in India. BP will pay an aggregate consideration of $ 7.2 billion for the interests to be acquired in the 23 production sharing contracts. Future performance payments of up to $ 1.8 billion could be paid based on exploration success that results in development of commercial discoveries. - Shale gas joint ventures: During the year, the Company, through its subsidiaries, in the United States of America entered into three distinctive joint venture agreements with Atlas Energy, Pioneer Natural Resources and Carrizo Oil & Gas and acquired 40%, 45% and 60% interests, respectively in the shale gas acreage positions to be explored by these joint ventures. The net Shale acreage acquisition by Reliance is 3,12,430 acres. It also entered in to a separate joint venture with Pioneer Natural Resources aimed at addressing the mid-stream opportunity in gas evacuation and transportation. - Joint venture for Butyl Rubber production in India: During the year, RIL and Russias SIBUR announced a joint venture for

the setting up of a facility for producing 100,000 MT butyl rubber in India. This is a significant step towards Reliances commitment to service Indias growing automotive sector by bringing in complex technologies, available with only a very few companies globally. The setting up of domestic manufacturing of butyl rubber which is expected to be commissioned by 2013, will fulfill a longstanding demand of the Indian tyre and rubber industry. - Spearheading the knowledge revolution: During the year, RIL acquired a substantial stake in Infotel Broadband Services Limited (Infotel Broadband), which emerged as a successful bidder in all the 22 circles of the auction for Broadband Wireless Access (BWA) Spectrum conducted by the Department of Telecommunications (DoT). RIL owns 95% of the equity share capital of Infotel Broadband. RIL sees the broadband opportunity as a new frontier of knowledge economy in which it is confident of taking leadership position and providing India with an opportunity to be in the forefront among the countries providing world-class 4G network and services. Others: The Honorable Supreme Court of India delivered its judgment in the Reliance Natural Resources Limited (RNRL) - RIL dispute. The judgment recognized the dominant role of the provisions of the Production Sharing Contract and upheld the policies formulated by the Government under which it has the authority to regulate the production and distribution of natural gas. RIL and RNRL signed a Gas Supply Master Agreement in compliance with the Gas Utilization Policy and EGoM decisions. RIL and Reliance ADA Group companies approved and signed an agreement canceling all existing non-compete arrangements entered into between the two groups pursuant to the scheme of reorganization of the Reliance Group and entered into a new simpler, non-compete agreement with respect to gas based power generation. Consolidated Financial Statements In accordance with the Accounting Standard AS-21 on Consolidated Financial Statements read with Accounting Standard AS-23 on Accounting for Investments in Associates and AS-27 on Financial Reporting of Interest in Joint Ventures, the audited Consolidated Financial Statements are provided in the Annual Report. Subsidiaries In accordance with the general circular issued by the Ministry of Corporate Affairs, Government of India, the Balance Sheet, Profit and Loss Account and other documents of the subsidiary companies are not being attached with the Balance Sheet of the Company. The Company will make available the Annual Accounts of the subsidiary companies and the related detailed information to any member of the Company who may be interested in obtaining the same. The annual accounts of the subsidiary companies will also be kept open for inspection at the Registered Office of the Company and that of the respective subsidiary companies.

The Consolidated Financial Statements presented by the Company include the financial results of its subsidiary companies. Details of major subsidiaries of the Company are covered in Managements Discussion and Analysis Report forming part of the Annual Report. Directors Shri Ramaniklal H. Ambani, Shri Nikhil R. Meswani, Prof. Ashok Misra and Shri Yogendra P. Trivedi, Directors, retire by rotation and being eligible, offer themselves for reappointment at the ensuing Annual General Meeting. Group Pursuant to intimation from the Promoters, the names of the Promoters and entities comprising the group are disclosed in the Annual Report for the purpose of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997. 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 annual accounts for the year ended March 31, 2011, the applicable accounting standards read with requirements set out under Schedule VI to the Companies Act, 1956, 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 a true and fair view of the state of affairs of the Company as at March 31, 2011 and of the profit of the Company for the year ended on that date; (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; and (iv) the Directors have prepared the annual accounts of the Company on a going concern basis. Auditors and Auditors Report M/s. Chaturvedi & Shah, Chartered Accountants, M/s. Deloitte Haskins & Sells, Chartered Accountants and M/s. Rajendra & Co., Chartered Accountants, Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General Meeting and are eligible for reappointment. The Company has received letters from all of them to the effect that their reappointment, if made, would be within the prescribed limits

under Section 224(1B) of the Companies Act, 1956 and that they are not disqualified for reappointment within the meaning of Section 226 of the said Act. The Notes on Accounts referred to in the Auditors Report are self-explanatory and do not call for any further comments. Cost Auditors The Central Government has approved the appointment of the following cost auditors for conducting Cost Audit for the financial year 2010-11 (i) For the textiles business - M/s. Kiran J. Mehta & Co, Cost Accountant; (ii) For the chemicals business Shri S. N. Cost Accountant, M/s. V. J. Talati & Co., Cost Accountants, M/s. Diwanji & Associates, Cost Accountants, M/s. K. G. Goyal & Associates, Cost Accountants; and (iii) For the polyester business Shri Suresh D. Shenoy, Cost Accountant, M/s. V. Kumar & Associates, Cost Accountants. Secretarial Audit Report As a measure of good corporate governance practice, the Board of Directors of the Company appointed Dr. K.R. Chandratre, Practicing Company Secretary, to conduct Secretarial Audit of records and documents of the Company. The Secretarial Audit Report for the financial year ended March 31, 2011, is provided in the Annual Report. The Secretarial Audit Report confirms that the Company has complied with all the applicable provisions of the Companies Act, 1956, Depositories Act, 1996, Listing Agreements with the Stock Exchanges, Securities Contracts (Regulation) Act, 1956 and all the Regulations and Guidelines of SEBI as applicable to the Company, including the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997, the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992 and the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999. Particulars of Employees In terms of 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 the Directors Report. Having regard to the provisions of Section 219(1)(b)(iv) of the said Act, the Annual Report excluding the aforesaid information is being sent to all the members of the Company and others entitled thereto. Any member interested in Bavadekar,

obtaining such particulars may write to the Company Secretary at the registered office of the Company. Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo The particulars relating to energy conservation, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are provided in the Annexure-I to this Report. Transfer of amounts to Investor Education and Protection Fund Pursuant to the provisions of Section 205A(5) of the Companies Act, 1956, dividends, interest on debentures and matured debentures which remained unpaid or unclaimed for a period of 7 years have been transferred by the Company to the Investor Education and Protection Fund. Corporate Governance The Company is committed to maintain the highest standards of Corporate Governance and adhere to the Corporate Governance requirements set out by SEBI. The Company has also implemented several best corporate governance practices as prevalent globally. The Report on Corporate Governance as stipulated under Clause 49 of the Listing Agreement forms part of the Annual Report. The requisite Certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance as stipulated under the aforesaid Clause 49, is attached to this Report. Acknowledgement Your Directors would like to express their appreciation for the assistance and co-operation received from the financial institutions, banks, Government authorities, customers, vendors and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by the executives, staff and workers of the Company. For and on behalf of the Board of Directors Mukesh D. Ambani Chairman and Managing Director April 21, 2011