• Operational income (excluding other operational income) was down by 8% to Rs 6871.6 crore. And the down side in operational income was largely due lower revenue of power as well as EPC contracts. While the revenue of electricity energy was down by 5% to Rs 6062.09 crore that of EPC contracts was down by 41% to Rs 514.12 crore. However the revenue of infrastructure business was up by 14% to Rs 295.39 crore. The other operating income was up by 90% to Rs 101.29 crore. Thus the overall operational income was down by 8% to Rs 6972.89 crore.
  
• EBIT was down by 10% to Rs 835.05 crore and that is largely due to lower profit in both power and EPC business of the company. Segment profit of power business was lower by 9% to Rs 645.75 crore despite its sales (net of regulatory expenses) was up by marginal 1% to Rs 5977.29 crore. Fall in segment profit of power despite marginally higher sales is largely due to 120 bps contraction in segment margin to 10.8%. The segment profit of EPC was down by 42% to Rs 74.22 crore hurt by lower sales (down 40% to Rs 523.58 crore) and 30 bps contraction in segment margin to 14.2%. However the segment profit of Infra business was up by 24% to Rs 115.08 crore, facilitated by higher sales (up 13% to Rs 298.34 crore) and 330 bps expansion in segment margin to 38.6%.

Half yearly performance

Sales were lower by 3% to Rs 14071.48 crore. Lower sale together with 50 bps contraction in OPM has resulted in 5% fall in operating profit to Rs 2532.72 crore. However at PBT (before regulatory income & EO) level the fall was 13% (to Rs 1131.73 crore) as hit by higher interest and depreciation cost even though the other income stood higher by 17% to Rs 1354.56 crore. The regulatory expense for the period was down by 14% to Rs 357.39 crore. Thus the PBT before EO but after regulatory income was down by 12% to Rs 774.34 crore. EO income for the period was Rs 85.58 crore towards gain from sales of cement business, compared to nil in the corresponding previous period. Thus the PBT after EO was down by 3% to Rs 859.92 crore.

Taxation provision was lower by 59% to Rs 74.83 crore. Spurred thus the PAT was up by 12% to Rs 785.09 crore. The share of profit from associates was down by 27% to Rs 186.80 crore. The minority interest was a share of loss of Rs 5.29 crore compared to a share of profit of Rs 30.14 crore in the corresponding previous period. Thus the net profit (after MI but before profit from discontinued biz) was up by 5% to Rs 977.18 crore. Profit from discontinued business was Rs 32.17 crore compared to a loss of Rs 91.64 crore in the corresponding previous period. Thus the Net profit was up by 21% to Rs 1009.35 crore. The other comprehensive income (net of tax) was Rs 3.31 crore compared to an expense of Rs 10.18 crore in the corresponding previous period. Thus the total comprehensive income was up by 23% to Rs 1012.66 crore.

Other developments

Pursuant to the option exercised under the Scheme of Amalgamation of Reliance infra projects Ltd. with the Company sanctioned by the Hon'ble High Court of Judicature at Bombay on March 30, 2011, net foreign exchange loss of Rs 156.25 crore (net off of foreign exchange loss of Rs.2.13 crore attributable to finance cost) for the quarter ended Sep 30, 2016 has been credited to the 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 half year ended Sep 30, 2016 would have been lower by Rs 156.25 crore and Rs 118.54 crore respectively and General Reserve would have been higher 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.

Un realized gains amounting to Rs 14.57 crore and Rs 44.67 crore during the quarter and half year ended Sep 2016, pertaining to EPC contracts entered into with associate companies, have not been eliminated as prescribed by a Scheme of Amalgamation between Reliance Bhavnagar Power and Reliance Jamnagar Power and Reliance Infrastrcuture Engineers with the parent company sanctioned by the Hon'ble High Court of Judicature at Bombay in February 2013. The parent company considers that the prescribed accounting treatment leads to a more accurate reflection of the results of the working of the parent company. Had the relevant provisions of Ind As 28 ‘Investments in Associates and JV' been followed, the profit before tax and carrying cost of investment to associate for the quarter and half year ended Sep 2016 would have been lower by RS 14.57 crore and Rs 44.67 crore respectively. This matter has been referred to by the Auditors in their report.

Delhi Airport Metro Express Pvt. Ltd. (DAMEPL), a SPV of the Company, had terminated the Concession Agreement with Delhi Metro Rail Corporation (DMRC) for the Delhi Airport Metro Line and the operations were taken over by DMRC with effect from July 1, 2013. As per the terms of the Concession Agreement, DMRC is now liable to pay DAMEPL a Termination Payment, which is estimated at Rs 2823 crore, as the termination has arisen owing to DMRC's Event of Default. The matter has been referred to arbitration and the process for the same is continuing. Pending final outcome of the arbitration, the Company continues to fund the statutory and other obligations of DAMEPL post take over by DMRC and accordingly has funded Rs 69.58 crore and Rs 140.58 crore during the quarter and half year ended on Sep 30, 2016 respectively. The total investment made by the Company in DAMEPL upto Sep 30, 2016 amounts to Rs 2201.44 crore. The Company had reviewed the progress in settlement of various claims and also on overall review of financial position of DAMEPL, the Company considered it prudent to write off Rs. 1613.76 crore till previous year ended March 31, 2016 out of the above investment. However, as legally advised, DAMEPL's claims for the termination payments are considered fully enforceable. This matter has been referred to by the Auditors in their report,

Signed binding term sheet with Adani Transmission Ltd for sale of 3 transmission assets i.e. WRSSS (B & C) and Parbati Koldam.

Strategic partnership agreement with Dassault Aviation to execute offset contracts worth Rs 30000 crore for 36 Rafale fighter jets – Largest ever offset contracts in India.