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How Big Is Reliance?

How Big Is Reliance?

Reliance – It doesn’t require any introduction. It is well-known label that associates with trust and reliability. The Reliance Industries that was founded by Dhirubhai Ambani has a undergone 47 years long journey where it saw many ups and downs. It also experienced a split in 2005 after the sad demise of Dhirubhai ( 6 July 2002).

Dhirubhai Ambani was honoured Padma Vibhushan in 2016 by the Government of India. Not many people know how he started his journey of business though.

Did you know Dhirubhai made his first fortune in Aden, Yemen by melting Sliver coins?

Dhirubhai worked at a petrol station in Aden. During that time, the silver coins in circulation at that time in Yemen had less value than the silver used in making them. So he melted those coins and made profits. His eldest son, Mukesh was born in Yemen.

After coming back from Yemen, Dhirubhai chose Mumbai as the place to establish his business. The firm Reliance Industries Limited was registered in 1973 and the rest is history.

In this article, we shall have a look at some interesting facts about reliance first and then analyze how much Mr. Ambani has in his pocket.

Facts About The Reliance Family That You Wouldn’t Know.

Dhirubhai Ambani was the “Secretary” of Junagadh Students Union. On 15 August 1947, the Nawab of Junagadh ordered all the citizens to stay in their houses and imposed a curfew. Dhirubhai decided to defy the curfew and called a students meeting. Because of that, he was summoned by the police. He wasn’t punished and was sent back to the boarding late night.

According to Forbes, when Dhirubhai took his last breath ( 2002 ) he was 138th richest person in world. Worth $2.9 Billion.

Reliance sponsored the 1987 Cricket World Cup. Australia won the WorldCup finals played in Eden Garden Stadium in Kolkata.

RIL would be the world’s 59th richest country right now if it were a country. RIL’s market cap is ₹11,99,043.93 crore. Believe me, there’s a lot more where that came from!

RIL owns the world’s largest refining hub with a capacity of 1.24 million barrels of oil per day. It is popularly known as Jamnagar Refinery.

Jio has a network of over 90000 4G LTE towers installed across India

Jio provides World’s Cheapest 4G internet – 30 TIMES Cheaper than in USA.

Brief Introduction and History Of Reliance

Reliance Industries Limited (RIL) is an Indian Multi-Industry Company that has its center of operations in Mumbai. It owns businesses engaged in energy, petrochemicals, textiles, natural resources, retail, telecommunications- you can name them all! Reliance is one of the most profitable companies in India. It is the largest publicly traded company in India by market capitalization. 

In 1960, the company was co-founded by Dhirubhai Ambani and Champaklal Damani as Reliance Commercial Cooperation. Five years later, the partnership ended and Dhirubhai continued handling the firm. In 1966, Reliance Textiles Engineers Pvt. Ltd was incorporated in Maharashtra. In the same year, a synthetic fabrics mill was established in Naroda, Gujarat. On the 8th of May 1973, it became known as Reliance Industries Limited. In 1975, the company expanded its business into textiles with “Vimal” becoming it’s major brand later on. During the years 1985 to 1992, the company expanded its installed capacity for producing polyester yarn by over 145,000 tonnes per annum.

In 2001, Reliance Industries Ltd. and Reliance Petroleum Ltd. became India’s two largest companies in terms of all major financial parameters. Reliance Petroleum was merged with Reliance Industries. In 2002, they announced India’s biggest gas discovery in nearly three decades and one of the largest gas discoveries in the world during 2002. The in-place volume of natural gas was in excess of 7 trillion cubic feet, equivalent to about 1.2 billion barrels of crude oil. This was the first-ever discovery by an Indian private sector company.

In 2002–03, RIL purchased a majority stake in Indian Petrochemicals Corporation Ltd. (IPCL), India’s second largest petrochemicals company, from the government of India. RIL took over IPCL’s Vadodara Plants and renamed it as Vadodara Manufacturing Division (VMD). IPCL’s Nagothane and Dahej manufacturing complexes came under RIL when IPCL was merged with RIL in 2008. In 2005-2006, the company reorganized its business by demerging its investments in power generation and distribution, financial services and telecommunication services into four separate entities.

Ambani entered the organized retail market in India with the launch of its retail store format under the brand name of ‘Reliance Fresh’in 2006. However, by the end of 2008, they had close to 600 stores across 57 cities in India.

Reliance Industries issued 1:1 bonus shares to its shareholders in November 2009.

They entered the broadband services market with the acquisition of Infotel Broadband Services Limited. It was the only successful bidder for pan-India fourth-generation (4G) spectrum auction held by the government of India.

In the same year, Reliance and Bharat Petroleum BP announced a partnership in the oil and gas business. BP took a 30 percent stake in 23 oil and gas production sharing contracts that Reliance operates in India, including the KG-D6 block for $7.2 billion. Moreover, they also formed a 50:50 joint venture with BP for sourcing and marketing of gas in India.

In 2017, RIL set up a joint venture with Russian Company Sibur for setting up a Butyl rubber plant in Jamnagar, Gujarat, to be operational by 2018.

In August 2019, they added Fynd primarily for its consumer businesses and mobile phone services in the e-commerce space.

Reliance History

Shareholding of Reliance: 

The number of shares of RIL is approximately 3.1 billion. The Ambani family holds approximately 46.32% of the total shares and the remaining 53.68% shares are held by public shareholders. Life Insurance Corporation of India is the largest non-promoter investor in the company, with 7.98% shareholding.

Major Branches of Reliance:

From the 31st of March 2013, the company had 158 subsidiary companies and 7 associate companies.

  1. Jio Platforms Limited
Reliance JIO

This is an Indian Digital services company and a subsidiary of Reliance Industries Limited. It was established in 2019. The company owns India’s largest mobile network operator, Jio and other digital businesses of Reliance. From the May, Jio Platforms was reported to be fourth largest Indian Company by market capitalization. Since April 2020, Reliance Industries has raised 152,056 crore rupees by selling 32.97% equity stake in Jio Platforms.

In April 2020, Facebook acquired a 9.99% stake in Jio Platforms for ₹435.74 billion. According to this deal, while Jio Platforms retained ₹149.76 billion, the parent got the remaining ₹285.98 billion.

2. Reliance Retail

Reliance Retail

It was founded in 2006 and is the largest retailer in India in terms of revenue. Its outlets offer foods, groceries, footwear, lifestyle and home products, electronic goods, and farm implements and inputs. It focuses on consumer goods and other such products. It has a total of 3,837 stores across 750 cities. Their yearly revenue is 690 billion rupees.

There are over 45 divisions of Reliance Retail. The following is a list of the major divisions:

  • Reliance Fresh: Outlets of fruits, vegetables and groceries.
  • Reliance Smart: outlets of fresh produce, bakery, dairy products, home and personal care products, general merchandise, fruits, vegetables and groceries.
  • Reliance Digital: Electronics retail stores.
  • Reliance LYF: 4G mobile handset manufacturer
  • Reliance Jewels: Jewelry retail
  • Reliance Trends: Apparel and Clothing
  • Reliance Market
  • AJIO: Shopping website
  • Hamleys
  • Jio Mart

3. Reliance Institute of Life Sciences

This is an institution of higher education in various fields of life sciences. It is said to be India’s pioneer institute in offering graduate, post graduate, doctoral and research education programs in several emerging areas of science and technology. The institute offers training in specific areas of basic and applied sciences, agriculture and environment sciences, process development and manufacturing sciences, clinical research and science and engineering courses in the computer, biomedical and pharmaceutical fields.

4. Reliance Life Sciences

This division works around medical, plant and industrial biotechnology opportunities. They specialise in manufacturing, branding, marketing Reliance Industries products.

5. Reliance Logistics

Reliance Logistics Logo

This is a single window company selling transportation, distribution, warehousing. logistics and supply chain-related products. This is a company is an asset based company with its own fleet and infrastructure. It provides logistics services to Reliance group companies and outsiders.

6. Reliance Clinical Research Services (RCRS)

Reliance Clinical Research Services

This is a contract research organisation and wholly owned subsidiary of Reliance Life Science. It specialises in the clinical research services industry.

7. Reliance Solar

This was established to produce and retail solar energy systems primarily to remote and rural areas. They offer a range of products based on solar energy such as solar lanterns, home lighting systems, street lighting systems, water purification systems, refrigeration systems and solar air conditioners.

8. Relicord

It is a cord blood banking service owned by Life Sciences Division. It has been accredited by AABB.

9. Jio Infocomm Limited (RJIL)

This is a broadband service provider which gained 4G licenses for operating across India.

10. Reliance Industrial Infrastructure Limited (RIIL)

This is an associate company of RIL. RIL holds 45.43% of total shares of RIIL. Their main objective is to build and operate cross country pipelines for transporting petroleum products.

11. LYF

Is a 4G enabled VoLTE device brand.

12. Network 18

This is a mass media company which has interests in television, digital platforms, publication, mobile apps and films. It also operates two joint ventures, Viacom 18 and History TV18. It has also acquired ETV Network and renamed it under the Colors TV brand.

13. Eros Productions LLP

This is a joint venture with Eros International to produce film content in India.

Wrapping Up

As of 31 March 2018, the company had 29,533 permanent employees of which 1,521 were women and 70 were employees with disabilities. Their revenue is ₹659,205 crore. The operating income is ₹102,280 crore and the net income is ₹44,324 crore. The company has total assets worth ₹1,165,915 crore.

Under the Corporate Social Responsibility, 2% profit is mandeted by the law to be used for Social Work. RIL does much beyond that. They have contributed CSR expenditure worth ₹4792 Crores from 2014 – 2020.

RIL is also the highest tax payer of India. They paid ₹1,15,461 Crores in Financial Year 2019-2020.

In our opinion, as Sam Pitroda is called the father of Telecom Revolution, Mukesh Ambani should also be called the father of Internet Revolution. It is after his launch of Jio 4G that the rural population gained access to high-speed Internet. History would remember Mr.Mukesh Ambani for this contribution to India.

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