Reliance Industries Invests ₹14,839 Crore in Retail Arm to Boost Long-Term Growth

Reliance Industries, backed by Mukesh Ambani, injected nearly Rs 14,839 crore into its retail segment as debt during the last fiscal year. The investment was largely aimed at bolstering Reliance Retail's long-term investment strategies, as the company continues to expand into smaller towns and explore new store formats.

According to the company’s latest financial statement, this funding was provided as an inter-corporate deposit from Reliance Retail Ventures. In total, the parent company invested around Rs 19,170 crore in Reliance Retail during the last fiscal year, which includes Rs 4,330 crore in equity, as per a report by the Economic Times.

At 9:30 am, the shares of the conglomerate were trading at Rs 2,929, up by nearly 0.30 per cent on the National Stock Exchange.

Reliance Retail Ventures, which is also the holding company for Reliance's retail and FMCG businesses and a subsidiary of Reliance Industries, raised about Rs 17,814 crore in equity from investors and its parent company in FY24.

During the same period, Reliance Retail repaid its Rs 8,019 crore in long-term bank loans, a significant increase from the Rs 50 crore repaid in FY23. This repayment reduced its non-current bank loan borrowings by 30 per cent to Rs 13,382 crore as of March 31, 2024. Its short-term unsecured bank borrowings fell by more than half to Rs 5,267 crore.

Recent Layoffs

Reliance reportedly laid off more than 40,000 employees in FY23-24. The cuts were largely made in the conglomerate's retail segment. The layoffs were largely part of RIL's workforce reduction strategy.

The total employee count declined from 3.89 lakh in FY 2022-23 to 3.47 lakh in FY 2023-24. Moreover, new hires dropped by more than a third, with a total of 1.71 lakh added in FY24, as per the media report.

On a year-to-date basis, Reliance has delivered returns of 13 per cent on the NSE.