Reliance Infrastructure Limited                                                                                                                              

                                                                                                                                                                                 (` crore)

Notes: 

1.  The Consolidated Financial Results of Reliance Infrastructure Limited (the Parent Company), its subsidiaries (together referred to as the "Group"), associates and joint ventures have been prepared in accordance with Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Companies Act, 2013 read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and the Companies (Indian Accounting Standards) Amendment Rules, 2016.

2.   The outbreak of COVID-19 epidemic has significantly impacted businesses around the world. The Government of India ordered a nationwide lockdown, initially for 21 days which further got extended twice and now valid till May 17, 2020, to prevent community spread of COVID-19 in India. This has resulted in significant reduction in economic activities. With respect to operations of the Group, it has impacted its business by way of interruption in construction activities, operations of metros, toll collections, supply chain disruption, unavailability of personnel, closure / lock down of various other facilities etc. Few of the construction activities are already commenced albeit in a limited manner. Further, to reduce the impact on cash flows of the group, it has availed moratorium on term loans with respect to certain subsidiaries (Delhi Discoms & selected toll road companies) as per RBI guidelines, wherever applicable.                                  . 

The Group has considered various internal and external information including assumptions relating to economic forecasts up to the date of approval of these financials for assessing the recoverability of various receivables, which includes unbilled receivables, investments, goodwill, contract assets and contract costs. The assumptions used by the Group have been tested through sensitivity analysis and the Group expects to recover the carrying amount of these assets based on the current indicators of future economic conditions. Further the Group has availed protections available to it as per various contractual provisions to reduce the impact of COVID-19.  

The aforesaid evaluation is based on projections and estimations which are dependent on future development including government policies. Any changes due to the changes in situations / circumstances will be taken into consideration, if necessary, as and when it crystallizes.

3.   Pursuant to the Scheme of Amalgamation of Reliance Infraprojects Limited with the Parent Company, sanctioned by the Hon'ble High Court of Judicature at Bombay on March 30, 2011, net foreign exchange gain of ` 88.95 crore and ` 141.41 crore for the quarter and year ended March 31, 2020 has been credited to the Consolidated Statement of Profit and Loss and an equivalent amount has been transferred to General Reserve. Had such transfer not been done, the profit before tax for the quarter and year ended March 31, 2020 would have been higher by ` 88.95 crore and ` 141.41 crore respectively and General Reserve would have been lower by an equivalent amount. The treatment prescribed under the Scheme overrides the relevant provisions of Ind AS 1 "Presentation of Financial Statements". This matter has been referred to by the auditors in their report as an emphasis of matter.

4.   Other Income includes ` Nil  and ` 210 crore for the quarter and year ended March 31, 2020 recognised pursuant to arbitration award won by the Parent Company against Damodar Valley Corporation (DVC) totalling to ` 1,250 crore including return of Bank Guarantees of ` 354 crore. DVC has preferred an appeal against the award before the Hon'ble Calcutta High Court, which was listed for hearing in the first week of March 2020, however the same is postponed due to Covid19 outbreak and the next date of hearing is awaited. Although the Parent Company is confident of recovering the entire amount, out of prudence, the Parent Company has recognized only ` 210 crore being the retention money which was earlier written off.

5.   The dispute between Delhi Airport Metro Express Private Limited (DAMEPL), a subsidiary of the Parent Company and Delhi Metro Rail Corporation (DMRC) arising out of the termination of the Concession Agreement for Delhi Airport Metro Express Line Project (Project) by DAMEPL was referred to an arbitral tribunal, which vide its Award dated May 11, 2017, granted  ` 4,662.59 crore (on the date of the Award) in favour of DAMEPL being inter alia in consideration of DAMEPL transferring the ownership of the Project to DMRC, who has taken over the same. The Award was upheld by a Single Judge of Hon'ble Delhi High Court vide  Judgment dated March 06, 2018. However, the said Judgment dated March 06, 2018 was set aside by the Division Bench of Hon'ble Delhi High Court vide Judgement dated January 15, 2019. DAMEPL has filed Special Leave Petition (SLP) before the Hon'ble Supreme Court of India against the said Judgement dated January 15, 2019 of Division Bench of Hon'ble Delhi High Court. Hon'ble Supreme Court of India, while hearing the Interlocutory Application filed by DAMEPL seeking interim relief, had directed vide its Order dated April 22, 2019 that DAMEPL's accounts shall not be declared as NPA till further orders and further directed listing of the SLP for hearing on July 23, 2019. However, the matter was adjourned on DMRC's request dated July 22, 2019. Later, the hearing could not take place due to various reasons. The next hearing to take place sometime after the present COVID-19 lockdown ends and courts reopen.  Based on the facts of the case and the applicable law, DAMEPL is confident of succeeding in the Hon'ble Supreme Court. In view of the above, pending outcome of SLP before the Hon'ble Supreme Court of India, DAMEPL has continued to prepare its financial statements on going concern basis.

6.   In respect of Reliance Naval and Engineering Limited (RNaval),(an associate of the Parent Company)  Hon'ble National Company Law Tribunal (NCLT), Ahmedabad bench vide its order dated January 15, 2020 has initiated Corporate Insolvency Resolution Process and appointed Interim Resolution Professional (IRP) under Insolvency and Bankruptcy Code, 2016 (IBC). Since the entire investment in RNaval has been written off in previous year, there is be no impact of RNaval's account on Group's financial results during the quarter and year ended March 31, 2020.

7.   Certain subsidiaries and associates have continued to prepare the financial statements on a going concern basis. The details thereof together with the reasons for the going concern basis of preparation of the respective financial statements are summarised below on the basis of the related disclosures made in the separate financial statements of such subsidiaries and associates:

a)   In respect of Mumbai Metro One Private Limited (MMOPL), a subsidiary of the Parent Company, the net worth has eroded and as at the year end, its current liabilities exceeded its current assets. MMOPL is taking a number of steps to improve overall commercial viability which will result in an improvement in cash flows and enable the Company to meet its financial obligations. It has shown year-on-year growth in passenger traffic and the revenues of the Company have been sufficient to recover its operating costs and the EBITA (Earnings before Interest, Tax and Amortization) has been positive since commencement of operations. Additionally, the overall infrastructure facility has a long useful life and the remaining period of concession is approximately 25 years. MMOPL is also in active discussion with its bankers for restructuring of their loans. The Lenders of MMOPL have decided to implement the resolution plan submitted by MMOPL and lead bank has already sanctioned the same and other lenders are in the process of obtaining necessary approvals.. The Parent Company has confirmed to provide necessary support to enable MMOPL to operate as a going concern and accordingly, the financial statements of MMOPL have been prepared on a going concern basis. The auditors of MMOPL have referred this matter in the "material uncertainty related to going concern" paragraph in their report.

b)   In case of GF Toll Road Private Limited (GFTR), due to its inability to pay the overdue amount of Rupee Term Loan instalments and have been classified as a Non Performing Asset (NPA) by the consortium lenders. The consortium lenders have stopped charging monthly interest amount with effect from the date of classifying the account as NPA. However, GFTR has been regular in paying the monthly interest amount on accrual basis.  GFTR is under discussion with the consortium lenders and has proposed a Resolution Plan (RP). The Lead Lender and the consortium are in the process of appointing Techno Economic Viability consultant for presenting RP to the consortium. In view of the above, in spite of the Loan account being classified as NPA by the lenders and the ongoing RP, the management of GFTR has continued to be prepare the financial statements as a 'Going Concern'.

c)   In case of TK Toll Road Private Limited (TKTR) a wholly owned subsidiary of the Parent Company, as at March 31, 2020, the current liabilities of the TKTR have exceeded its current assets. TKTR is undertaking a number of steps which will result in an improvement in cash flows and enable TKTR to meet its financial obligations. There has also been improvement in the revenues of TKTR and such revenues have been sufficient to recover the operating costs and the EBITA (Earnings before Interest, Tax & Amortisation) has been positive since the commencement of the operations. Additionally, it enjoys long concession period extending upto FY 2038 and the current cash flow issues have occurred due to mismatch in the repayment schedule vis a vis the concession period.

TKTR is also in advanced stages of discussion with its lenders for restructuring of their loans and is confident that the restructuring plan would be approved. Further it has filed arbitration claims worth ` 1,117.00 crore, and is confident of favourable outcome, which will further improve the financial position of the TKTR. Accordingly, notwithstanding the dependence on above said uncertain events, TKTR continues to prepare the financial statements on a going concern basis. The auditors of TKTR have referred this matter in the "material uncertainty related to going concern" paragraph in their report.

d)   In case of TD Toll Road Private Limited ("TDTR") a wholly owned subsidiary of the Parent Company, as at March 31, 2020, the current liabilities of TDTR have exceeded its current assets. TDTR is undertaking a number of steps which will result in an improvement in cash flows and enable TDTR to meet its financial obligations. There has also been improvement in the revenues of TDTR and such revenues have been sufficient to recover the operating costs and the EBITA (Earnings before Interest, Tax & Amortisation) has been positive since the commencement of the operations. Additionally, it enjoys long concession period extending upto FY 2038 and the current cash flow issues have occurred due to mismatch in the repayment schedule vis a vis the concession period. It is also in advanced stages of discussion with its lenders for restructuring of their loans and is confident that the restructuring plan would be approved.

Further it has won arbitration claim worth `158.45 crore, which will further improve the financial position of the TDTR. Pursuant thereto one of the lender applied for the insolvency petition under the IBC against TDTR before the Hon'ble NCLT, Mumbai Bench, for non payment of the interest and the instalments payable under the Rupee Term Loan Agreement. The Hon'ble NCLT vide its order dated November 25, 2019 admitted the application and appointed the IRP.The IRP took over the affairs of TDTR from December 05, 2019. Aggrieved by the order of the NCLT Mumbai Bench, TDTR moved an appeal before the Hon'ble National Company Law Appellate Tribunal (NCLAT) praying to set aside the impugned order and stay the proceedings. The matter is currently reserved for orders.

Accordingly, notwithstanding the dependence on above said uncertain events, TDTR continues to prepare the financial statements on a going concern basis. The auditors of TKTR have referred this matter in the "material uncertainty related to going concern" paragraph in their report.

e)   Notwithstanding the dependence on these material uncertain events including achievement of debt resolution and restructuring of loans, time bound monetisation of assets as well as favourable and timely outcome of various claims, the Group is confident that such cash flows would enable it to service its debt, realise its assets and discharge its liabilities, including devolvement of any guarantees / support to certain entities including the subsidiaries and associates in the normal course of its business. Accordingly, the consolidated financial statements of the Group have been prepared on a going concern basis.

8.   The Reliance Group of companies of which the Parent Company is a part, supported an independent company in which the Parent Company holds less than 2% of equity shares ("EPC Company") to inter alia undertake contracts and assignments for the large number of varied projects in the fields of Power (Thermal, Hydro and Nuclear), Roads, Cement, Telecom, Metro Rail, etc. which were proposed and/or under development by the Reliance Group. To this end along with other companies of the Reliance Group the Parent Company funded EPC Company by way of project advances, subscription to debentures and inter corporate deposits. The total exposure of the Parent Company as on March31, 2020 was ` 8,066.08 crore net of provision of ` 3,972.17 crore and the Parent Company has also provided corporate guarantees aggregating of ` 1,775 crore.

The activities of EPC Company have been impacted by the reduced project activities of the companies of the Reliance Group. While the Parent Company is evaluating the nature of relationship; if any, with the independent EPC Company, based on the analysis carried out in earlier years, the EPC Company has not been treated as related party.

Given the huge opportunity in the EPC field particularly considering the Government of India's thrust on infrastructure sector coupled with increasing project and EPC activities of the Reliance Group, the EPC Company with its experience will be able to achieve substantial project activities in excess of its current levels, thus enabling the EPC Company to meet its obligations. The Parent Company is reasonably confident that the provision will be adequate to deal with any contingency relating to recovery from the EPC Company.

During the year, the Parent Company has provided corporate guarantees of ` 4,895.87 crore on behalf of certain companies towards their borrowings. As per the reasonable estimate of the management of the Parent Company, it does not expect any obligation against the above guarantee amount.

9.   KM Toll Road Private Limited (KMTR), a subsidiary of the Parent Company, has terminated the Concession Agreement with National Highways Authority of India (NHAI) for Kandla Mundra Road Project (Project) on May 7, 2019, on account of Material Breach and Event of Default under the provisions of the Concession Agreement by NHAI. The operations of the Project have been taken over by NHAI and NHAI has given a contract to a third party for toll collection with effect from April 16, 2019. Accordingly, in terms of the provisions of the Concession Agreement, NHAI is liable to pay KMTR a termination payment estimated at ` 1205.47 crore as the termination has arisen owing to NHAI Event of Default. KMTR has also raised further claims of ` 1,092.74 crore. KMTR is confident of the positive outcome of the claims so raised. Pending final outcome of the notice of termination and possible arbitration proceedings and as legally advised, the claims for the Termination Payment are considered fully enforceable. Accordingly, notwithstanding the dependence on above said uncertain events, the company continues to prepare the financial statements on a going concern basis. The Group is confident of recovering its entire investment in KMTR, and hence, no provision for impairment on the KMTR is considered in the financial statements. The results of the KMTR are classified as Discontinued operations as per Ind AS 105 "Non Current Assets held for sale and discontinued operations".

10.  BSES Kerala Power Limited (BKPL), a wholly owned subsidiary of the Parent Company, carried out impairment testing of Property, plant and equipments and other assets considering overall situation and accordingly has provided for the impairment of ` 126 crore  to the Statement of Profit and Loss for the quarter and year ended March 31, 2020. This has been considered as an exceptional item.

11.  The listed non convertible debentures (NCDs) of ` 1,087.70 crore as on March 31, 2020 are secured by way of first pari passu charge on certain fixed assets and  investments. There are certain shortfalls in the security cover. Further, India Ratings and Research Private Limited have retained in IND C and rating by CARE Ratings has changed to CARE D in respect of NCDs.

Details of due date wise obligations in respect of Secured Non Convertible debentures outstanding as on March 31, 2020 (as per original repayment schedule) are as follows:

                * Paid on due date

# Outstanding as at March 31, 2020

12.  During the quarter ended and year ended March 31, 2020, ` 9.59 and ` 3,215.77 crore respectively being the loss on invocation of pledge of shares of RPower held by the Parent Company has been adjusted against the capital reserve/capital reserve on consolidation. According to the management of the Parent Company, this is an extremely rare circumstance where even though the value of long term strategic investment is high, the same is being disposed off at much lower value for the reasons beyond the control of the Parent Company, thereby causing the said loss to the Parent Company. Hence, being the capital loss, the same has been adjusted against the capital reserve/capital reserve on consolidation.

Further, due to above said invocation, during the quarter, investment in RPower has been reduced to 12.77% of its paid-up share capital. Accordingly in terms of Ind AS 28 on Investments in Associates , RPower ceases to be an associate of the Parent Company. Although this being strategic investment and Parent Company continues to be promoter of the RPower, due to the invocations of the shares by the lenders for the reasons beyond the control of the Parent Company the balance investments in RPower have been carried at fair value in accordance with Ind AS 109 on financial instruments and valued at current market price and loss of Rs. 2,096.25 crore being the capital loss, has been adjusted against the capital reserve/capital reserve on consolidation. Had the above mentioned treatments of loss not been debited to capital reserve and capital reserve on consolidation, the profit before tax for the quarter and year ended March 31, 2020 would have been lower by `. 2,105.84 crore and ` 5,312.02 crore and capital reserve and capital reserve on consolidation in aggregate would have been higher by an equivalent amount.  

13.  The Parent Company also has net recoverable amounts aggregating to ` 2,044.50 crore from RPower Group as at March 31, 2020. Management had performed an impairment assessment of these recoverable by considering interalia the valuations of the underlying subsidiaries of RPower which are based on their value in use (considering discounted cash flows) and valuations of other assets of RPower/its subsidiaries based on their fair values, which have been determined by external valuation experts . The determination of the value in use / fair value involves significant management judgement and estimates on the various assumptions including relating to growth rates, discount rates, terminal value, time that may be required to identify buyers, negotiation discounts etc Accordingly, based on the assessment, impairment of said recoverable is not considered necessary by the management.

14.  The Parent Company has entered into a Share Purchase Agreement with Cube Highways and Infrastructure III Pte Limited for sale of its entire stake in DA Toll Road Private Limited. The Company has received in-principle approval from NHAI; final approval and customary approvals are awaited and hence has not been considered as Non-Current Assets held for sale and discontinued operations as per Ind AS 105 "Non-Current Assets held for sale and discontinued operations".

15.  Delhi Electricity Regulatory Commission (DERC) issued Tariff Orders for truing up on September 29, 2015 upto March 31, 2014, on August 31, 2017 for the Financial Years 2014-15 and 2015-16,on March 28, 2018 for the Financial Year 2016-17 and on July 31, 2019 for Financial Year 2017-18 for two subsidiaries of the Parent Company, namely, BSES Rajdhani Power Limited (BRPL) and BSES Yamuna Power Limited (BYPL) (Delhi Discoms),  DERC in these Tariff Orders had trued up the revenue gap with certain dis-allowances. The Delhi Discoms have filed appeals against these orders before Hon'ble Appellate Tribunal for Electricity (APTEL). Based on legal opinion, the impacts of such disallowances, which are subject matter of appeal, have not been considered in the computation of regulatory assets for the respective years. This matter has been referred to by the auditors in their report as an emphasis of matter.

16.  NTPC Limited served notice on Delhi Discoms for regulation (suspension) of power supply on February 01, 2014 due to delay in payments. The Delhi Discoms filed a writ petition  against the notice before the Hon'ble Supreme Court (SC) and prayed for suitable direction from Hon'ble SC to DERC for providing cost reflective tariff and giving a roadmap for liquidation of the accumulated Regulatory Assets. The Hon'ble SC in its interim order directed the Delhi Discoms to pay the current dues (w.e.f. January 2014). The Delhi Discoms sought modification of the said order so as to allow them to pay 70% of the current dues which was allowed by Hon'ble SC in respect of Delhi Power Utilities only on May 12, 2016. In the last hearing on May 02, 2018, the Hon'ble Judge did not pronounce the judgement. Since then, both the Judges have retired. The matter shall be re-heard before another Bench. However, on April 11, 2019 new interim application have been filed by Delhi Gencos in pending contempt petitions of 2015 alleging non compliance of Supreme Court order regarding payment of current dues.  On November 28, 2019, Counsel for Delhi Power Utilities requested for early hearing of the Contempt petitions. This matters along with Writ Petitions were listed on January 7, 2020 before Hon'ble Court. The Hon'ble Court on the request of Delhi Discoms directed that, all connected matters be tagged with Writ and Contempt Petitions.  Till date no specific date of hearing has been fixed. This matter has been referred to by the auditors in their report as an emphasis of matter.

17.  Pursuant to the direction of the Department of Power (GoNCTD) on January 07, 2014, the Comptroller and Auditor General of India (CAG) conducted audit of Delhi Discoms and submitted the draft audit report. The Delhi Discoms challenged the direction of GoNCTD before the Hon'ble High Court of Delhi (HC). The Hon'ble HC in its order dated October 30, 2015 set aside the directions of GoNCTD and concluded with "direction to set aside all actions taken pursuant to the January 07, 2014 order and all acts undertaken in pursuance thereof are in-fructuous". The aggrieved parties have filed an appeal against the Hon'ble HC judgement before the Hon'ble Supreme Court (SC) which was last heard on March 9, 2017. The Court has reserved its order on the issue whether it would like to hear the matter or transfer it to the constitutional bench where matter between GoNCTD powers vis-a-vis Lieutenant Governor (LG) powers was then pending. On July 03, 2017 the Bench opined that the instant appeals need not be referred to the Constitution Bench and adjudication of the appeals should not await the outcome of the decision of the Constitution Bench. In terms of the signed order, appeals were directed to be listed for hearing on merits. Next date of hearing is not yet fixed. This matter has been referred to by the auditors in their report as an emphasis of matter.

18.  (Loss)/Profit from Discontinued business is net of tax expenses (including Net of deferred tax) amounting to ` Nil for the quarter ended March 31, 2020 ` 55.45 crore for the quarter March 31, 2019 and (` 2,238.30 crore) for the year ended March 31, 2019. The Discontinued Business Operations represents KM Toll Road Private Limited and Mumbai Power Business of the Parent Company.

19.  The Group operates in three segments, namely, Power, Engineering and Construction (E&C) and Infrastructure. Power segment comprises of generation, transmission and distribution of power at various locations. E&C segment renders comprehensive, value added services in construction, erection and commissioning and Infrastructure includes businesses with respect to development, operation and maintenance of toll roads, metro rail transit systems and airports. 

20.  The Group has adopted Ind AS 116, effective annual reporting period beginning on April 01, 2019 and applied the standard to its leases, retrospectively with the cumulative effect of initially applying the standard recognised at the date of initial application without making any adjustment to opening balance of retained earnings. The adoption of the standard did not have any material impact on the financial results of the Group.

21.  Key standalone financial information is given below.

                                                                                                                                                     (` crore)

22.  The figures for the quarter ended March 31, 2020 and March 31, 2019 are the balancing figures between the audited figures in respect of full financial year and the published year to date figures up to the third quarter of the respective financial year. The figures for the previous periods have been regrouped and rearranged to make them comparable with those of current period.

23.  After review by the Audit Committee, the Board of Directors of the Parent Company has approved the consolidated financial results at their meeting held on May 8, 2020.

                                                                            For and on behalf of the Board of Directors

Place: Mumbai                                                                         Punit Garg

Date: May 8, 2020                                           Executive Director and Chief Executive Officer

Auditor's Report on the consolidated financial results of Reliance Infrastructure Limited for the quarter and year ended March 31, 2020 pursuant to Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

Independent Auditor's Report

To the Board of Directors of Reliance Infrastructure Limited ("the Holding Company")

Report on the Audit of Consolidated Financial Results

Disclaimer of Opinion

We were engaged to audit the accompanying consolidated financial results of Reliance Infrastructure Limited (hereinafter referred to as the 'the Holding Company") and its subsidiaries (Holding Company and its subsidiaries together referred to as "the Group"), its associates and jointly controlled entities for the quarter and year ended March 31, 2020, ("consolidated financial results") attached herewith, being submitted by the Holding Company pursuant to the requirement of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended ('Listing Regulations').

Because of the substantive nature and significance of the matter described in the "Basis for Disclaimer of Opinion", we have not been able to obtain sufficient appropriate audit evidence to provide the basis of our opinion as to whether these consolidated financial results:

(i)    Include the results of the entities listed in Annexure 1;

(ii)    are presented in accordance with the requirements of Regulation 33 of the Listing Regulations in this regard; and

(iii)   give a true and fair view in conformity with the applicable Indian Accounting Standards, and other accounting principles generally accepted in India, of net loss and other comprehensive loss and other financial information of the Group for the quarter and year ended March 31, 2020.

Basis for Disclaimer of Opinion

1.    We refer to Note 8 to the consolidated financial results regarding the Holding Company has exposure in an EPC Company as on March 31, 2020 aggregating to Rs. 8,066.08Crore (net of provision of Rs. 3,972.17 Crore). Further, the Company has also provided corporate guarantees aggregating to Rs. 1,775 Crore on behalf of the aforesaid EPC Company towards borrowings of the EPC Company.

According to the Management of the Holding Company, these amounts have been funded mainly for general corporate purposes and towards funding of working capital requirements of the party which has been engaged in providing Engineering, Procurement and Construction (EPC) services primarily to the Holding Company and its subsidiaries and its associates and the EPC Company will be able to meet its obligation.

As referred to in the above note, the Holding Company has further provided Corporate Guarantees of Rs. 4,895.87 Crore in favour of certain companies towards their borrowings.According to the Management of the Company these amounts have been given for general corporate purposes.

We were unable to evaluate about the relationship, the recoverability and possible obligation towards the Corporate Guarantee given. Accordingly, we are unable to determine the consequential implications arising therefrom in the consolidated financial results.

2.    We refer to Note 12 to the consolidated financial results wherein the loss on invocation of shares held in Reliance Power Limited (RPower) amounting to Rs. 9.59 Crore and Rs. 3,215.77 Crore for the quarter and year ended March 31, 2020 respectively has been adjusted against the capital reserve. The above treatment of loss on invocation of shares is not accordance with the Ind AS 28 "Investments in Associates and Joint Ventures" and Ind AS 1 "Presentation of Financial Statements".

Further, due to the invocation of shares as stated above, RPower ceases to be an associate of the Company. The balance investments in RPower have been carried at fair value in accordance with Ind AS 109 "Financial Instruments" and valued at current market price and loss on fair valuation amounting to Rs. 2,096.25Crore has been adjusted against the capital reserve. The above treatment is not in accordance with the Ind AS 1 "Presentation of Financial Statements" and Ind AS 109 "Financial Instruments".

Had the Group followed the treatment prescribed under the above Ind AS's the Profit before tax for the quarter and year ended would have been lower by Rs. 2,105.84 Crore & Rs. 5,312.02 Crore and capital reserve and total equity would have been higher by an equivalent amount.

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Companies Act, 2013 ("Act"). Our responsibilities under those Standards are further described in the Auditor's Responsibilities for the Audit of the Consolidated Financial Results section of our report. We are independent of the Group, its associates and jointly controlled entities in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India together with the ethical requirements that are relevant to our audit of the financial statements under the provisions of the Companies Act, 2013 and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. However, because of the matters described in paragraph 1 and 2 above, we were not able to obtain sufficient appropriate evidence to provide a basis of our Opinion on the consolidated financial results.

Material Uncertainty Related to Going Concern

We draw attention to Note 5, 7and 9 to the consolidated financial results in respect of:

1.    Mumbai Metro One Private Limited (MMOPL) whose net worth has been eroded and, as at the year end, MMOPL's current liabilities exceeded its current assets. These events or conditions, along with other matters as set forth in Note 7(a) to the consolidated financial results, indicate that a material uncertainty exists that may cast significant doubt on MMOPL's ability to continue as a going concern. However, the financial statements of MMOPL have been prepared on a going concern basis for the reasons stated in the said Note.

2.    GF Toll Road Private Limited (GFTR) which indicates that due to the inability of GFTR to repay the overdue amount of instalments, the lenders have classified GFTR as a Non-Performing Asset (NPA) during the quarter and year ended March 31, 2020. The events and conditions along with the other matters as set forth in Note 7(b) to the consolidated financial results, indicate that a material uncertainty exists that may cast significant doubt on GFTR ability to continue as a going concern. However, the financial statements of GFTR have been prepared on a going concern basis for the reasons stated in the said Note.

3.    TK Toll Road Private Limited (TKTR), which indicates that TKTR has incurred a net loss during theyear ended March 31, 2020 and as on date the current liabilities exceed the current assets. These conditions along with other matters set forth in Note 7(c) to the consolidated financial results, indicate that a material uncertainty exists that may cast significant doubt on TKTR's ability to continue as a going concern. However, the financial statements of TKTR have been prepared on a going concern basis for the reasons stated in the said Note.

4.    TD Toll Road Private Limited (TDTR), which indicates that TDTR has incurred a net loss during the year ended March 31, 2020 and as on date the current liabilities exceed the current assets. These conditions along with other matters set forth in Note 7(d) to the consolidated financial results, indicate that a material uncertainty exists that may cast significant doubt on TDTR's ability to continue as a going concern. However, the financial statements of TDTR have been prepared on a going concern basis for the reasons stated in the said Note.

5.   KM Toll Road Private Limited (KMTR), has terminated the Concession Agreement with National Highways Authority of India (NHAI) for KandlaMundra Road Project (Project) on May 7, 2019, and accordingly the business operations of the Company post termination date has ceased to continue. These conditions alongwith the other matters set forth in Note 9 indicate that material uncertainty exists that may cast significant doubt on KMTR's ability to continue as a going concern. However, the financial statements of KMTR have been prepared on a going concern basis for the reasons stated in the said Note.

6.   Delhi Airport Metro Express Private Limited (DAMEPL) which has significant accumulated losses and a special leave petition in relation to an Arbitration Award is pending with the Honorable Supreme Court of India. These events and conditions as more fully described in Note 5to the consolidated financial results indicate that a material uncertainty exists that may cast a significant doubt on DAMEPL's ability to continue as a going concern. The auditors of DAMEPL have referred this matter in the 'Emphasis of Matters' paragraph in their report.

7.    Additionally the auditors of certain subsidiaries and associates have highlighted material uncertainties related to going concern / emphasis of matter paragraph in their respective audit reports.

The Holding Company has outstanding obligations to lenders and is also an guarantor for its subsidiaries and as stated in paragraphs 1 to 7 above in respect of the subsidiaries and associates of the Holding Company, the consequential impact of these events or conditions, along with other matters as set forth in Note 7(e)to the consolidated financial results, indicate that a material uncertainty exists that may cast significant doubt on the Group's ability to continue as a going concern.

Our opinion is not modified in respect of the above matters.

Emphasis of Matter Paragraph

1.    We draw attention to Note 3 to the consolidated financial results regarding the Scheme of Amalgamation ('the Scheme') between Reliance Infraprojects Limited (wholly owned subsidiary of the Holding Company) and the Holding Company sanctioned by the Hon'ble High Court of Judicature at Bombay vide its order dated March 30, 2011, wherein the Holding Company, as determined by the Board of Directors, is permitted to adjust foreign exchange/derivative/hedging losses/gains debited/credited to the Statement of Profit and Loss by a corresponding withdrawal from or credit to General Reserve which overrides the relevant provisions of Ind AS - 1 "Presentation of financial statements". The net foreign exchange gain of Rs. 88.95Crore and Rs. 141.41Crore for the quarter and year ended March 31, 2020 respectively has been credited to Statement of Profit and Loss and an equivalent amount has been transferred to General Reserve in terms of the Scheme. Had such transfer not been made, profit before tax for the quarter and year ended March 31, 2020 would have been higher by of Rs. 88.95Crore and Rs. 141.41Crore respectively and General Reserve would have been lower by an equivalent amount.

2.    We draw attention to Note 13to the consolidated financial results which describes the impairment assessment performed by the Holding Company in respect of its receivable aggregating to Rs. 2,044.50Crore in Reliance Power Limited (RPower) as at March 31, 2020 in accordance with Ind AS 36 "Impairment of assets" / Ind AS 109 "Financial Instruments". This assessment involves significant management judgment and estimates on the valuation methodology and various assumptions used in determination of value in use/fair value by independent valuation experts / management as more fully described in the aforesaid note. Based on management's assessment and independent valuation reports, no impairment is considered necessary on the investment and the recoverable amounts.

3.    We draw attention to Note 9 to the consolidated financial results with respect to KMTR has terminated the concession agreement with NHAI on May 7, 2019 and accordingly, the business operations of the Company post termination date has ceased to continue. No provision for impairment in values of assets of the Company has been considered in the financial statements of KMTR for the reasons stated in the said note.

4.    We draw attention to Note 15to the consolidated financial results with regard to Delhi Electricity Regulatory Commission (DERC) Tariff Order received by BSES Rajdhani Power Limited (BRPL) and BSES Yamuna Power Limited (BYPL), subsidiaries of the Parent Company, wherein revenue gap upto March 31, 2014, March 31, 2015, March 31, 2016, March 31, 2017 and March 31, 2018 has been trued up with certain disallowances. BRPL and BYPL have preferred an appeal before Appellate Tribunal (APTEL) on the said disallowance and based on legal opinion, no impact of such disallowance, which is subject matter of appeal, has been considered. The opinion of BRPL and BYPL's auditors is not modified in respect of this matter.

5.    We draw attention to Note 16to the consolidated financial results regarding dues payable to various electricity generating companies and timely recovery of accumulated regulatory deferral account balance by BRPL and BYPL in respect of which the dispute is pending before Hon'ble Supreme Court. The opinion of BRPL and BYPL's auditors is not modified in respect of this matter.

6.    We draw attention to Note 17to the consolidated financial results relating to the audit of BRPL and BYPL conducted by the Comptroller and Auditor General of India (CAG), stay granted by the Honorable High Court against any action to be taken by CAG pursuant to the said audit and the subsequent appeal by the CAG and others against judgment of the Honorable High Court. The opinion of BRPL and BYPL's auditors is not modified in respect of this matter.

7.    We draw attention to Note no. 2 to the consolidated financial results, as regards to the management evaluation of COVID - 19 impact on the future performance of the Group.

Our opinion is not modified in respect of the above matters.

Board of Directors' Responsibilities for the Consolidated Financial Results

The consolidated financial results, which is the responsibility of the Holding Company's Management and approved by the Board of Directors of the Holding Company, has been prepared on the basis of the consolidated financial statements. The Holding Company's Board of Directors are responsible for the preparation and presentation of these consolidated financial results that give a true and fair view of the net profit/ loss and other comprehensive income and other financial information of the Group including its associates and jointly controlled entities in accordance with the Indian Accounting Standards prescribed under Section 133 of the Act read with relevant rules issued thereunder and other accounting principles generally accepted in India and in compliance with Regulation 33 of the Listing Regulations. The respective Board of Directors of the companies included in the Group and of its associates and jointly controlled entities are responsible for maintenance of adequate accounting records in accordance with the provisionsof the Act for safeguarding of the assets of the Group and its associates and jointly controlled entities and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring accuracy and completeness of the accounting records, relevant to the preparation and presentation of the consolidated financial results that give a true and fair view and are free from material misstatement, whether due to fraud or error, which have been used for the purpose of preparation of the consolidated financial results by the Directors of the Holding Company, as aforesaid.

In preparing the consolidated financial results, the respective Board of Directors of the companies included in the Group and of its associates and jointly controlled entities are responsible for assessing the ability of the Group and its associates and jointly controlled entities to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the respective Board of Directors either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

The respective Board of Directors of the companies included in the Group and of its associates and jointly controlled entities are responsible for overseeing the financial reporting process of the Group and of its associates and jointly controlled entities.

Auditor's Responsibilities for the Audit of the Consolidated Financial Results

Our objectives are to obtain reasonable assurance about whether the consolidated financial results as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial results.

As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

·       Identify and assess the risks of material misstatement of the consolidated financial results, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

·       Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under Section 143(3) (i) of the Act, we are also responsible for expressing our opinion on whether the company has adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls.

·       Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Board of Directors.

·       Conclude on the appropriateness of the Board of Directors use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the ability of the Group and its associates and jointly controlled entities to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial results or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Group and its associates and jointly controlled entities to cease to continue as a going concern.

·       Evaluate the overall presentation, structure and content of the consolidated financial results, including the disclosures, and whether the consolidated financial results represent the underlying transactions and events in a manner that achieves fair presentation.

·       Obtain sufficient appropriate audit evidence regarding the financial results/financial information of the entities within the Group and its associates and jointly controlled entities to express an opinion on the consolidated Financial Results. We are responsible for the direction, supervision and performance of the audit of financial information of such entities included in the consolidated financial results of which we are the independent auditors. For the other entities included in the consolidated Financial Results, which have been audited by other auditors, such other auditors remain responsible for the direction, supervision and performance of the audits carried out by them. We remain solely responsible for our audit opinion.

We communicate with those charged with governance of the Holding Company and such other entities included in the consolidated financial results of which we are the independent auditors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

We also performed procedures in accordance with the circular issued by the SEBI under Regulation 33(8) of the Listing Regulations, as amended, to the extent applicable.

Other Matters

1.    The consolidated financial results include the audited financial results of 27subsidiaries, whose financial statements/financial information reflect total assets of Rs.46,772.76Crore as at March 31, 2020, total revenue of Rs. 4,174.92Crore and Rs. 18,915.90Crore, net (loss) after tax of Rs. (139.16) Crore and Rs. (137.31)Crore and total comprehensive income/(loss) of Rs. (110.33) Crore and Rs. (137.08) Crore for the quarter and year ended March 31, 2020 respectively and cash flows inflow  of Rs. 59.99Crore for the year ended March 31, 2020, as considered in the consolidated financial results. The consolidated financial results also includes the Group's share of net profit / (loss) after tax of Rs. Nil and Rs. Nil and total comprehensive income of Rs. Nil and Rs. Nil for the quarter and year ended March 31, 2020 respectively as considered in the consolidated financial results in respect of 4 associates, which have been audited by their respective independent auditors. The independent auditors' reports on financial statements/financial information of these entities have been furnished to us and our opinion on the consolidated financial results, in so far as it relates to the amounts and disclosures included in respect of these entities, is based solely on the report of such auditors and the procedures performed by us are as stated in paragraph above.

2.    The consolidated financial results include the unaudited financial results of 2subsidiaries, whose financial statements/financial information reflect total assets of Rs.213.75Crore as at March 31, 2020, total revenue of Rs. 6.02Crore and Rs. 10.12 Crore, net (loss) after tax of Rs. (12) Crore and Rs. (26.76) Crore and total comprehensive income/(loss) of Rs. (12.02) Crore and Rs. (26.83) Crorefor the quarter and year ended March 31, 2020 respectively and cash flows (outflow) of Rs. (41.56) Crore for the year ended March 31, 2020, as considered in the consolidated financial results. The consolidated financial results also includes the Group's share of net profit / (loss) after tax of Rs. 1.52Crore and Rs. 6.38Crore and total comprehensive income of Rs. Nil and Rs. Nil for the quarter and year ended March 31, 2020 respectively as considered in the consolidated financial results in respect of 2 associates and 1 jointly controlled entities. These unaudited financial statements / financial information have been furnished to us by the Board of Directors and our opinion on the consolidated financial results, in so far as it relates to the amounts and disclosures included in respect of these subsidiaries, associates and jointly controlled entities is based solely on such unaudited financial statements/financial information. In our opinion and according to the information and explanations given to us by the Board of Directors, these financial statements/financial information are not material to the Group.

Our opinion on the consolidated financial results is not modified in respect of the above matters with respect to our reliance on the work done and the reports of the other auditors and the financial results/financial information certified by the Board of Directors.

The consolidated financial results include the results for the quarter ended March 31, 2020 and March 31, 2019 being the balancing figure between the audited figures in respect of the full financial year and the published unaudited year to date figures up to the third quarter of the respective financial year which were subject to limited review by us.

For Pathak H. D. & Associates LLP

Chartered Accountants

Firm Registration No. 107783W/W100593

Vishal D. Shah

Partner

Membership No. 119303

UDIN:

Place: Mumbai

Date: May 08, 2020

Annexure 1

Reliance Infrastructure Limited

The consolidated financial results include the results of the following entities:

A.    Subsidiaries (Including step-down subsidiaries)

B.    Associates

C.    Joint Venture