Reliance AGM: Marquee Global Investors Want To Invest In Reliance Retail, Says Ambani

Reliance Industries Ltd.'s Chairman and Managing Director Mukesh Ambani gave an inkling of raising more funds from global investors for its retail arm.

"Several marquee global strategic and financial investors have shown strong interest in Reliance Retail," he said on Monday while addressing the company's 46th Annual General Meeting. "I will update you about our progress with them in due course."

Reliance Retail Ventures Ltd. has previously raised about Rs 47,265 crore from various global investment firms and sovereign wealth funds—including Silver Lake Partners, Mubadala Investment Co., Abu Dhabi Investment Authority, GIC Pvt., TPG Capital Management, KKR & Co., General Atlantic Service Co., and the Public Investment Fund of Saudi Arabia—at a pre-money equity valuation of Rs 4.28 lakh crore.

Recently, the retail subsidiary raised $1 billion from the Qatar Investment Authority for a 1% equity stake. The latest investment values Reliance Retail at a pre-money equity value of Rs 8.28 lakh crore.

In less than three years, the valuation of the retail arm has almost doubled, notwithstanding the intervening Covid-19 pandemic, said Ambani. "Based on this valuation, Reliance Retail—had it been listed—would have ranked among the top four companies in India and the top 10 retailers globally."

"The pace of this value creation is unmatched globally," the chairman said.

According to India’s listing rules, the public shareholding—including those held by financial investors—of a company must be at least 25%. Currently, 11% of Reliance Retail Ventures' stake is owned by global investors, which means that it would need to dilute another 14% of its stake to be able to bring out the IPO.

Reliance Retail is the only Indian retailer in the global top 100.

It posted an annual revenue of Rs 2.6 lakh crore in FY23, registering a year-on-year growth of 30%. It delivered an Ebitda of Rs 17,928 crore and a net profit of Rs 9,181 crore. "As India grows from a $2,500 per capita economy to a $10,000 per capita economy, Reliance Retail will be our fastest-growing business in revenues and Ebitda," Ambani said.

"FY23 has been a landmark year for our retail business," said Isha Ambani, executive director, Reliance Retail Ventures Ltd. It crossed the milestone of 100 crore transactions in FY23, up 42% over the previous year. Reliance's stores received more than 78 crore footfalls during the year, and the number of registered customers grew to nearly 25 crore. "We are delivering value to over 30% of India’s addressable population," she said.

The digital and new commerce sales contributed nearly Rs 50,000 crore, accounting for about a fifth of the company's revenue. The company has invested over $10 billion in the past two years, focusing on building integration, growing in-house brands, and improving supply chain networks.

In terms of its FMCG business, the company is mulling the global expansion of the Campa Cola brand, Isha Ambani said. "We are scaling it up further in India and have also started work to take it global, starting with Asia and Africa."