Reliance-Diversify and Grow

Reliance is an Indian multinational corporation that has diverse business including energy, petrochemicals, natural gas, retail, telecommunications, mass media, and textiles.Reliance was founded by Dhirubhai Ambani on 8th May 1973 out of Mumbai ,India.Reliance originally started as a polyester firm which diversified into financial services and petroleum refining in the 1980s.The company’s success can be traced to the ease of listing on the Stock Exchange which allowed the company to stay capital rich and also acted as advertisement to the Indian public.Reliance also benefitted excessively from the liberalisation of the Indian Economy in the 1990s creating massive opportunities for the conglomerate.Reliance went public in 1977 with a initial price of 13 ₹.Many subsidiaries of Reliance later went public under separate tickers but back in 2013 all shares were consolidated to a single corporation which is Reliance Industries.

Reliance is currently trading at 2450-2600 ₹ with a market cap of 17T ₹.A major part of their revenue comes from Jio which is a telecommunications service provider and Reliance Gas which is involved in the refining of petrochemicals. Multiple businesses and a diversified revenue stream allow consistent profits for the conglomerate.The company has brought about several changes in the Indian markets with constant innovation and service creation since inception.Retail is another growing sector for Reliance as it brings in about 18.7% of the company’s annual revenue.

Reliance has a median price forecast of 3000 ₹ with a high prediction of 3600 ₹ and a low prediction of 2800 ₹.The median represents a 18% increase from the last traded price.The most interesting observation is the constant growth period that Reliance is facing.Usually companies have alternating growth and consolidation periods but in the case of Reliance the stock has been on a growth phase for the past 24 months.Even amongst two market corrections , there was no significant drop in the price.With takeovers and further investment plans, the future holds strong for Reliance Industries Limited.

Reliance is Indias most valuable country which is rightly marketed by Mukesh Ambani and his extravagant lifestyle.With a profit making history and long standing relations with various political groups in India and abroad, the company does receive a lot of support in government projects which act as steady income sources for various ventures.Reliance has multiple brands which can be categorised into traditional and new age companies.The traditional brands such as Repol and Recron which deals in B2B petrochemicals which brings in constant revenue for the company with no major growth.This serves as the backbone for various risk worthy ventures for Reliance. The early entry into these sectors was key for this being a major revenue source and supporting future ventures.Interestingly as the world moves away from fossil fuels to renewable energy sources, Reliance has been trying to take noticeable steps in the alternative energy space by investing 5.5L Cr ₹ in Gujarat for solar farms.Retail is a fairly new venture which has high profitability and they have been expanding significantly which is evident from the fact that they have opened over 5600 stores in the past 3 years.More noticeable is their entry into the shopping complex industry by the opening of Indias largest shopping mall the Jio World Drive.All these business plans are being driven by funds of the RIL Rights Issue of 2019 which had its final call paid back in December 2021 representing massive cash inflows to the business into a time where new ambitious projects were being initiated by the company.Reliance is also seeing a change in the management with control being handled slowly to the next generation.Reliance has also had very generous giving initiatives such as the Primary Education CSR and the Study Abroad Scholarships.All this shows positive signs of growth and long term viability for the business but the market speculates a short term drop in the stock following the standard market line pattern.