Notes: 

1.     The Standalone Financial Results of Reliance Infrastructure Limited ("the Company") for the quarter and year ended March 31, 2022 have been prepared in accordance with Indian Accounting Standards (Ind AS) prescribed under Section 133 of the Companies Act, 2013 ('the Act') read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and the Companies (Indian Accounting Standards) (Amendment) Rules, 2016.

2.       COVID-19 pandemic had impacted businesses across the globe and India causing significant disturbance and slowdown of economic activities. The Company has considered all possible impact of COVID-19 in preparation of the standalone financial results, including assessment of the recoverability of financial and non-financial assets based on the various internal and external information and assumptions relating to economic forecasts up to the date of approval of these financial results. The aforesaid assessment 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.     The Company at its Board Meeting dated September 25, 2021 has approved issue of unsecured foreign currency convertible bonds (FCCBs) upto U.S.$ 100 million maturing at the end of 10 years and 1 day from the issue date or  the date of the FCCBs being fully paid up, whichever is later, with a coupon rate of 4.5% p.a. on private placement basis. The FCCBs shall be convertible into approximately 6.64 crore equity shares of Rs.10 each of the Company in accordance with the terms of the FCCBs, at a price of Rs. 111 (including a premium of Rs. 101) per equity share.

4.     The Company has outstanding obligations payable to lenders and in respect of loan arrangements of certain entities including subsidiaries/associates where the Company is also a guarantor where certain amounts have also fallen due. The Company has repaid substantial debt during the previous financial year vis a vis certain debts repayment in the current financial year and is confident of meeting balance obligations by way of time bound monetisation of its assets and receipt of various claims including receivable from DAMEPL and accordingly, notwithstanding the dependence on these material uncertain events, the Company continues to prepare the Standalone Financial Results on a 'Going Concern' basis.

5.     Hon'ble Supreme Court on September 9, 2021 upheld the arbitral award in favour of Delhi Airport Metro Express Private Limited (DAMEPL), a subsidiary of the Company, in the matter of the dispute between DAMEPL and Delhi Metro Rail Corporation Limited (DMRC), arising due to the termination of the Concession Agreement for Delhi Airport Metro Express Line Project by DAMEPL. DMRC was consequently directed to pay termination payment and other compensation, totaling to Rs. 2,945 crore plus pre-award and post-award interest up to the date of payment to DAMEPL. DAMEPL had filed execution petition dated September 10, 2021 before Hon'ble Delhi High Court seeking execution of the Award against DMRC.

DMRC had deposited Rs.1,000 crore on December 8, 2021, Rs. 600 crore on February 23, 2022 and Rs. 166.44 crore on March 14, 2022, in the escrow account of DAMEPL, as per Hon'ble Delhi High Court's interim orders from time to time. DAMEPL has utilised the amount for its debt repayments. Hon'ble High Court of Delhi on March 10, 2022, in its Final Order, directed DMRC to make payment of Rs. 824.10 crore within two weeks' time and the remaining amount in two equal instalments on or before April 30, 2022 and May 31, 2022 respectively.

Being aggrieved by a particular paragraph of the judgment dated March 10, 2022, DAMEPL filed a Special Leave Petition before Hon'ble Supreme Court, limited to the issue of interest on pre-award interest, which was dismissed on May 5, 2022. DAMEPL is evaluating the judgment and contemplates to go for review against the judgment and will be filing suitable proceedings for speedy realization of the sums receivable.

6.     With respect to Company's wholly owned subsidiaries engaged in road projects:

a.        The Company has exposure aggregating to Rs. 2,954.24 crore in its nine subsidiaries (road SPVs) as at March 31, 2022. Management has recently performed an impairment assessment against these exposures, by considering inter-alia the valuations of the underlying subsidiaries carried out by independent external valuation expert. The Company is confident of recovering its entire investment in road SPVs. Accordingly, based on the assessment and external valuation report, impairment of said exposure is not considered.

b.         KM Toll Road Private Limited (KMTR), a subsidiary of the Company and part of road SPVs referred above, 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 (Agreement) by NHAI. The operations of the Project have been taken over by NHAI. In terms of the provisions of the Agreement, NHAI is liable to pay KMTR a termination payment as the termination has arisen owing to NHAI Event of Default and its has also raised further claims towards damages for the breaches of NHAI as per the Agreement. KMTR has invoked dispute resolution process under clause 44 of the Agreement. Subsequently on August 24, 2020 NHAI has release Rs.181.21 crore towards termination payment, which was utilized toward debt servicing.

As a part of the dispute resolution, KMTR has invoked arbitration and it is confident of fair outcome. KMTR filed its statement of claims before Arbitral Tribunal claiming termination payment Rs. 866.14 crore as the termination has arisen owing to NHAI's Event of Default (This amount is arrived at after adjusting the amount of aforementioned payment received from NHAI). KMTR has also filed further claims of Rs. 981.63 Crore towards damages for the breaches of NHAI as per the Agreement. Pending final outcome of the dispute resolution process and as legally advised, the claims for the Termination Payment are considered fully enforceable.

Notwithstanding the dependence on above material uncertain events, KMTR continues to prepare its financial results on a Going Concern basis. The Company is confident of recovering its entire investment in KMTR of Rs. 544.94 crore as at March 31, 2022, and hence, no provision for impairment of the KMTR is considered in the financial results. The Investments in the KMTR are classified as Non Current Assets held for sale as per Ind AS 105, "Non Current Assets held for sale and discontinued operations".        

7.     The listed non-convertible debentures of Rs. 1,064.29 crore as on March 31, 2022 are secured by way of first pari-passu charge on certain fixed assets and investments. There are certain shortfalls in the security cover.

8.     The Company has net receivables aggregating to Rs. 1,677 crore from Reliance Power Group as at March 31, 2022. Management has recently performed an impairment assessment of these receivables by considering inter-alia the valuations of the underlying subsidiaries of Reliance Power which are based on their value in use (considering discounted cash flows) and valuations of other assets of Reliance Power/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 receivables are not considered necessary by the Management.

9.     The Reliance Group of companies of which the Company is a part, supported an independent Company in which the 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 Company funded EPC Company by way of project advances, subscription to debentures and inter corporate deposits. The total exposure of the Company as at March 31, 2022 is Rs 6,526.82 crore (net of provision of Rs. 3,972.17 crore). The Company has also provided corporate guarantees aggregating of Rs. 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 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. Based on the available facts, the provision made will be adequate to deal with any contingency relating to recovery from the EPC Company. The Company has further provided corporate guarantees of Rs.4,895.87 crore on behalf of certain companies towards their borrowings. As per the reasonable estimate of the Management of the Company, it does not expect any obligation against the above guarantee amount.

10.  Disclosures required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 in respect of debt securities issued by the Company are as under :

#       Inventory represents store, spares and consumables only, hence Inventory turnover ratio is not   applicable to the Company.

@      In the financial year 2019-20, the Company had adjusted the loss on invocation/mark to market (required to be done due to invocation of shares by the lenders) of Rs. 5,024.88 crore against the capital reserve. The auditors in their report had mentioned that the above treatment is not in accordance with the Ind AS 1, "Presentation of Financial Statements", Ind AS 109, "Financial Instruments" and Ind AS 28, "Investment in Associates and Joint Ventures". However, the Company continues to disclose Net worth for the subsequent period without considering impact of above.

      Formulae for computation of ratios are as follows:

11.  During the quarter, the Company has sold its entire investments in its wholly owned subsidiary i.e. Utility Infrastructure & Works Private Limited.

12.  The Company is predominantly engaged in the business of Engineering and Construction (E&C). E&C segment renders comprehensive, value added services in construction, erection and commissioning. All other activities of the Company revolve around E&C business. As such there are no separate reportable segments, as per the Ind AS 108 on "Operating Segment".  All the operations  the Company are predominantly conducted within India, as such there are no separate reportable geographical segments.

13.  The Code on Social Security, 2020 relating to employee benefits during employment and post- employment benefits has received presidential assent. However the effective date of the code and final rules are yet to be notified. The Company will assess the impact once the subject rules are notified and will give appropriate impact in its financial statements in the period in which, the Code becomes effective.

14.  Other income for the quarter and year ended March 31, 2022 includes ;

(i) Foreign exchange gain of Rs. 26.94 crore and Rs. 55.23 crore respectively. The Corresponding impact during the previous periods and year was considered in the General Reserve. Figures for the previous periods and year are not comparable with current quarter and year ended to that extent.

(ii) Gain of Rs 127.97 crore, on transfer of participating interest in one of the joint operation i.e. Rinfra-Astaldi JV.

15.  The figures for the quarter ended March 31, 2022 and March 31, 2021 are the balancing figures between the audited figures in respect of the full financial year and the published year to date figures up to the nine months of the respective financial year. The figures for the previous periods and for the year ended March 31, 2021 have been regrouped and rearranged to make them comparable with those of current period.

16.  After review by the Audit Committee, the Board of Directors of the Company has approved the standalone financial results at their meeting held on May 13, 2022.

                                                                                                         For and on behalf of the Board of Directors

Place: Mumbai                                                               Punit Garg

Date:  May 13, 2022                                                                      Executive Director and Chief Executive Officer

Auditor's Report on the standalone financial results of Reliance Infrastructure Limited for the quarter and year ended March 31, 2022 pursuant to Regulation 33 and Regulation 52 read with Regulation 63(2) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

Independent Auditor's Report

To The Board of Directors of Reliance Infrastructure Limited

Report on the audit of the Standalone Financial Results

Disclaimer of Opinion

We were engaged to audit the accompanying standalone financial results of Reliance Infrastructure Limited ("the Company") which includes joint operations on a proportionate basis listed in Annexure A for the quarter and year ended March 31, 2022 ("standalone financial results", "the Statement") attached herewith, being submitted by the Company pursuant to the requirement of Regulation 33 and Regulation 52 read with Regulation 63(2) 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 standalone financial results:

i.     are presented in accordance with the requirements of Regulation 33 and Regulation 52 read with Regulation 63(2) of the Listing Regulations in this regard; and

ii.    give a true and fair view in conformity with the recognition and measurement principles laid down in the applicable Indian Accounting Standards and other accounting principles generally accepted in India of the net profit/(loss) and other comprehensive income and other financial information for the quarter and year ended March 31, 2022.

Basis for Disclaimer of Opinion

1.    We refer to Note 9 to the standalone financial results regarding the Company's exposure in an EPC Company as on March 31, 2022 aggregating to Rs. 6526.82 Crore (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 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 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 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, recoverability and possible obligation towards the Corporate Guarantees given. Accordingly, we are unable to determine the consequential implications arising therefrom in the standalone financial results of the Company.

2.   We refer to Note 10 of the Standalone financial results wherein the loss on invocation of shares and/or fair valuation of shares of investments held in Reliance Power Limited (RPower) aggregating to Rs. 5,024.88 Crore for the year ended March 31, 2020 was adjusted against the capital reserve as against charging the same in the Statement of Profit and Loss. The said treatment of loss on invocation and fair valuation of investments was not in accordance with the Ind AS 28 "Investment in Associates and Joint Venture", Ind AS 1 "Presentation of Financial Statements" and Ind AS 109 "Financial Instruments". Had the Company followed the above Ind AS's Net Worth of the Company as at March 31, 2021 and March 31, 2022 would have been lower by Rs. 5,024.88 Crore.

As a result 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 standalone financial results.

Material Uncertainty related to Going Concern

We draw attention to Note 4 to the standalone financial results, wherein the Company has outstanding obligations to lenders and the Company is also a guarantor for its subsidiaries and associates whose loans have also fallen due , which indicate that material uncertainty exists that may cast significant doubt on the Company's ability to continue as a going concern. However, for the reasons more fully described in the aforesaid note, the accounts of the Company have been prepared as a Going Concern.

Our opinion on the standalone financial results is not modified in respect of this matter.

Emphasis of Matter Paragraph

1.   We draw attention to Note 8  to the Statement which describes the impairment assessment in accordance with Ind   AS 36 "Impairment of assets" / Ind AS 109 "Financial Instruments" performed by the Company in respect of net  receivables of Rs.1,677 Crore as at March 31,2022  from Reliance Power Limited associate of the company   and its Subsidiaries  ("RPower Group") . 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 receivables by the management . Our Conclusion on the Statement is not modified in respect of above matter.

2.   We draw attention to Note 6(b) to the Statement regarding KM Toll Road Private Limited (KMTR), a subsidiary of the 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 Company is confident of recovering its entire investment of Rs. 544.94 Crore in KMTR, as at March 31, 2022 and no impairment has been considered necessary against the above investments by the management for the reasons stated in the aforesaid note. Our Conclusion on the Statement is not modified in respect of above matter.

3.   We draw attention to Note 6(a)  to the Statement which describes the impairment assessment in accordance with Ind   AS 36 "Impairment of assets" / Ind AS 109 "Financial Instruments" performed by the Company in respect of net  receivables of Rs.2954.24 Crore as at March 31,2022 in Nine subsidiaries i.e. Toll Road SPV's Companies (Excluding KMTR as stated in paragraph 2 above) . 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 receivables by the management . Our Conclusion on the Statement is not modified in respect of above matter.

4.   We draw attention to Note 2 to the Statement, as regards to the management evaluation of COVID - 19 impact on the future performance of the Company. Our conclusion on the Statement is not modified in respect of this matter.

Management's Responsibilities for the Standalone Financial Results

The standalone financial results, which is the responsibility of the Company's Management and approved by the Board of Directors, has been prepared on the basis of standalone financial statements. The Company's Board of Directors are responsible for the preparation of these financial results that give a true and fair view of the net profit/loss and other comprehensive income and other financial information 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 and Regulation 52 read with Regulation 63(2) of the Listing Regulations.

This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company 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 design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial results that give a true and fair view and are free from material misstatement, whether due to fraud or error.

In preparing the standalone financial results, the Board of Directors are responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

The Board of Directors are also responsible for overseeing the Company's financial reporting process.

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

Our responsibility is to conduct an audit of the standalone financial results in accordance with Standards on Auditing and to issue an auditor's report. However, because of the matter described in the Basis for Disclaimer of Opinion section of our report, we were not able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these standalone financial results.

We are independent of the Company in accordance with the Code of Ethics and provisions of the Act that are relevant to our audit of the standalone financial statements in India under the Act, and we have fulfilled our other ethical responsibilities in accordance with the Code of Ethics and the requirements under the Act.

Other Matters

1.  The standalone financial results include the audited financial results of 3 joint operations included in the Statement, whose financial information reflect total assets of Rs. 132.32 Crore as at March 31, 2022, total revenues of Rs. 26.36 Crore and Rs. 208.68 Crore, total net profit/(loss) after tax of Rs. 0.36 Crore and Rs. 3.71 Crore and total comprehensive income / (loss) of Rs. 0.36 Crore and Rs. 3.71 Crore for the quarter and year ended March 31, 2022 respectively as considered in this Statement. These financial information have been audited by other auditors whose reports have been furnished to us by the Management and our opinion on the standalone financial results, in so far it relates to amounts and disclosures included in respect of these joint operations, is solely based on the reports of the other auditors and the procedures performed by us are as stated in paragraph above.

2.  The audited financial results includes financial information of 2 Joint Operations which have not been auditor by their auditors, whose financial information reflect total revenues of Rs. NIL , total net loss after tax and total comprehensive loss of Rs. 0.24 Crore  for the quarter and year ended March 31, 2022 as considered in this statement, have been furnished to us by the management. Our conclusion on the Statement in so far it relates to the amounts and disclosures is based solely on such unaudited financial information. In our opinion and according to the information and explanation given to us by the management, these financial information are not material to the Company.

Our opinion on the standalone 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.

3.  The  standalone  financial  results  include  the  results for the quarter ended March 31, 2022  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 current financial years which were subject to limited review by us, as required under the Listing Regulations.

Annexure A

The Standalone financial results includes the financial information of the following joint  operations