scorecardValue RIL will create over the next decade will be multiple times of what it has done in 45 years, says Mukesh Ambani
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Value RIL will create over the next decade will be multiple times of what it has done in 45 years, says Mukesh Ambani

Value RIL will create over the next decade will be multiple times of what it has done in 45 years, says Mukesh Ambani
Business3 min read
  • RIL will kick off a virtuous multi-decade value creation cycle defined by faster growth, higher revenues, better margins across businesses.
  • Not content being an Indian champion, RIL has global ambitions.
  • With an eye on management bandwidth, Ambani is inducting new talent into the company to take it to the next level.

Investors were waiting with bated breath on the value unlocking story that is playing out at Reliance Industries after the listing of Jio Financial and plans to list the Reliance Retail and Jio Platforms. Like an indulgent patriarch, Mukesh Ambani did not disappoint investors on this front on Monday. While he did not give guidance, Ambani said: “The value that your company will create for all its stakeholders over the next decade will be multiple times greater than what it has generated over the past 45 years.”

RIL’s commitment to its key business principles will kick off a virtuous multi-decade value creation cycle defined by faster growth, higher revenues, better margins and increased EBITDA. He explained: “This will significantly enhance the earnings multiples of each of Reliance’s businesses.”

Citing his father’s life motto, Ambani talked about the role of dreams in achieving greater things. His father used to say, “For those who dare to dream, there is a whole world to win.” Dare one say that Reliance Industries does dream big. Over the last 15 years, the company has put money behind two big dreams – an omni-channel retail network and bridging the digital gap by enabling every Indian to experience the power of technology. Said Ambani: “Each dream became a reality. Each dream was bigger than the last one. Each dream made Reliance reinvent itself.”

Reliance is proof of the power of dreams. He went on to recount the journey of the company from 50 years ago. In the ’70s, Reliance’s dream was to make the colourful, long-lasting and aspirational polyester textiles available to all Indians. In the ’80s, Reliance dreamt of a largely self-sufficient India in the wonder materials of that era – polyester, polymers and petrochemicals. In the ’90s, Reliance dreamt of eliminating India’s dependency on imported fuels refined abroad. In the first decade of the 21st Century, Reliance was focused on enhancing India’s energy security by exploring hydrocarbons in the depths of oceans.

The value creation is not automatic at this behemoth. The company has consciously gone after businesses that have large pent-up demand, which is guaranteed to grow at a healthy rate annually over many decades. Ambani said: “This choice has led us to build businesses of global size and scale. Each of Reliance’s three growth engines ─ our O2C business, our Retail business and Jio’s Digital Services business ─ meets this value-creation criterion.” In reimagining the delivery of services not only does Reliance expand the market but it also transforms markets by constantly providing better alternatives. Back in 2017, it brought down the price of per GB of data to levels not seen in any other country. And this also creates perpetual demand.

Not content becoming a champion in India, RIL now has sights on the global market. Ambani made his ambition clear by saying: “Now that each of Reliance’s businesses has become a national champion in the domestic market, we are in a position to leverage our strengths and take our products, services and technologies and project execution capabilities to global markets without substantial new investments.”

Not only has he laid the foundation of a very strong future, Reliance is building a strong pipeline of young and exceptionally competent leaders, which includes his three children. “We are also expanding our already large size of professional talent from around the world, consistent with our vision to make Reliance a global corporate,” he said.

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