India's largest private company, Reliance Industries, aims to be completely debt-free by the end of this fiscal year, its chairman, Mukesh Ambani, announced on Friday.
"Reliance will be completely debt-free this year of 2011-12, which reflects the company's robust financial position and a sound balance sheet," Ambani told the firm's annual general meeting in Mumbai.
The company, which has an estimated 3.6 million shareholders, had an outstanding debt of 673 billion rupees ($15 billion) as of March.
Its cash balance was 423.93 billion rupees, Ambani added.
But despite the upbeat balance-sheet announcement, Reliance's shares fell 1.65 percent to 936.15 rupees on investor disappointment that Ambani failed to clarify how the company would boost natural gas output, analysts said.
Reliance is India's largest private oil and gas explorer with a strong presence in the petrochemicals and polyester sectors and has expanded into the fast-growing broadband, banking and retail segments in recent years.
But although still the highest weighted company on the Bombay Stock Exchange, its share price has stumbled in recent months over concerns about future oil and gas production.
Gas output from the KG-D6 field off India's east coast has tumbled nearly 17 percent to 50-51 million metric standard cubic metres a day (mmscmd), from a peak of 60 mmscmd last year.
"There was not much clarity on when gas production will increase," said Apurva Shah, head of research at Mumbai brokerage Prabhudas Lilladher.
Ambani, who is India's richest man, told shareholders only that "significant efforts are on to comprehend the character and the behavior of these complex reservoirs" in Indian deep waters.
Existing oil and gas assets, particularly the KG-D6 reservoirs, would be studied by Reliance and BP, to help boost production after the government approved a recently announced partnership between the two energy giants.
Reliance this year signed a $7.2-billion deal with BP for the British firm to take a 30-percent stake in the Indian company's 23 largely unexplored deep water oil and gas fields off India's coast.
The move is the first by a global major to help explore and produce oil in India from hard-to-exploit reserves.
India imports about 80 percent of its crude oil and has been frantically trying to find new fuel sources as the country's economy grows.
In the retail sector, Ambani said its unit, Reliance Retail, will soon launch a wholesale "cash-and-carry" format for smaller traders and new links with established overseas brands to enhance growth.
Reliance Retail currently has over 1,000 stores in 86 Indian cities.
For the full year ended March, Reliance posted a record net profit of 202.86 billion rupees ($4.5 billion), led by turnover of 2.56 trillion rupees.
"Most of Reliance's current projects have a long-gestation period," noted Sonam Udasi, head of research at IDBI Capital, adding investors have raised concerns that Reliance has been sitting too long on its cash pile.