I solved it by following steps:

Step1 : in the py create a method to replace field variables to values:

from openerp.addons.email_template import email_template // this path may vary depending on your addons directory structure

def method_name(params)

converted_content = email_template.mako_template_env.from_string(<your_html_content>).render({

        'objects': <object>, //<object> like sale.order(1)

        'o': <object>,         

    })

return converted_content

Step 2: In your report xml file, call method to py:

<t t-raw="method_name()"/>