The Qatar Investment Authority has committed to invest INR 8,278 crore (approximately $1 billion) into Reliance Retail Ventures, a subsidiary of Reliance Industries. This investment secures them a 0.99 percent equity stake in the company, which is valued at INR 8.3 lakh crore. This valuation is now twice the value it held three years ago.
During 2020, Reliance Retail Ventures successfully garnered INR 47,265 crore from a group of international investors in exchange for a 10 percent equity share. At that time, the equity valuation had amounted to INR 4.2 lakh crore. In an official exchange filing, the company stated that this transaction positioned RRVL as one of the four leading companies in the country in terms of total equity value.
RRVL oversees the entirety of RIL’s retail and consumer-focused enterprises, which encompass sectors such as groceries, consumer electronics, fashion and lifestyle, as well as pharmaceutical products.
“We look forward to benefitting from QIA’s global experience and strong track record of value creation as we further develop Reliance Retail Ventures Limited into a world-class institution, driving the transformation of the Indian retail sector,” Isha Ambani, Director, said in the statement.
The company said that QIA’s “investment comes as the Qatari fund seeks to further invest in India’s fast-growing economy.”
The timing of this announcement holds particular significance, occurring just prior to RIL’s annual general meeting scheduled for August 28th.
RRVL’s upcoming listing is anticipated, and during the AGM, Mukesh Ambani, renowned for significant announcements, might also provide a timeline for this event. The conglomerate has recently accomplished the listing of Jio Financial Services, marking its first listing in approximately 17 years.
Retail stands as a substantial contributor to the revenue of the RIL Group. In the fiscal year 2023, RRVL disclosed a revenue of $31.7 billion, accompanied by an operating profit of $2.2 billion.
Having amassed a customer base of approximately 250 million and operating more than 18,000 stores, it commanded a cumulative retail space of 66 million square feet by the close of March.
Its expansion is being propelled by a combination of deliberate acquisitions and natural growth. A portion of the newly acquired funds from QIA will be allocated towards these acquisitions.
In the current year of 2023, the stock of RIL has experienced an appreciation of approximately 9 percent.