Unleashing Net Worth

Sandeep Goel    Monday, 19 May 2025

Reliance Industries Ltd. (RIL)’s standalone ‘net worth’ for 31st March, 2025 is ₹ 496,889 crore {INR 4,968,890 million}.

What does it signal?

Let’s deep dive in this fiscal year into the jargon Net Worth and unleash it for everyone – who wants to navigate this wave of ocean.

“Net worth” is defined as shareholders’ funds/owned funds, the one enjoyed by the equity shareholders.

Ultimately equity shareholders are the real owners who sink and swim with the company. They have all the right to enjoy this residual equally.

It is simply calculated as: Total Assets (A) – Total Liabilities (L).

Assets are resources you own. Liabilities are obligations you owe in financial terms.

For example, if your assets include land ₹ 100,000, machinery ₹ 50,000, furnitures & fixtures ₹ 40,000, trademarks and patents ₹ 50,000, investments in other companies ₹ 20,000.

Total tangible and intangible assets are ₹ 260,000.

You take a long-term loan from the bank of ₹ 80,000 and short-term credit of ₹ 10,000 for meeting day-to-day requirements. The suppliers’ outstanding payments are ₹ 10,000.

Total liabilities amount to ₹ 100,000.

Net worth is A-L, that is ₹ 260,000 minus ₹ 100,000 = ₹ 160,000.

Hold your lens now…

• Is it positive? Yes!
• Has it grown y-o-y? Assuming, last year net worth was ₹ 100,000. So, it has increased by 60%. This is an indication of rising corpus of the company – a sign of increasing stability for the stakeholders, in particular shareholders.
• Is company a good pick for investing? Yes!!

For more on this and solving numerous financial puzzles, check out 3rd Edition of the Book “Finance for Non-Finance People” or here.