Mukesh Ambani, Chairman of RIL intends to create Rs.40, 000 crore revenue in the next 3-4 years from the retail sector at the sixth AGM (Annual General Meeting) in Mumbai. He aims to upsurge the revenue of this business fivefold with the present turnover accounting to be Rs 7,600 crore. The retail business is still in its nascent stage and will turn out to be profitable in a span of time, according to the leading tycoon of the country.
The last fiscal year witnessed the company investing a colossal amount of Rs.5, 027 crore in Reliance Retail. The agenda is to focus on smaller segments of this business including Digital and Trends that have a huge scope for growth in the future. He considers the retail business a catalyst to bolster the reliance revenue and pave way for a booming oil-retail-telecom conglomerate.
The readiness to invest persistently and expand this business further is a testament to the fact that the Reliance retail is awaiting a buoyant future. Mukesh Ambani has exhibited sheer confidence in expanding the retail segment since the time of its launch. There are around 1300 stores catering to multiple formats in 86 cities in the country, operating under the retail sector. The retail segment aims to intensify its consumer base by over three times by increasing the number of consumers visiting the store to around 1 crore from 30,000 at present. Aggressive expansion is the key to attain this milestone, according to Mr. Ambani.
True to its genes, the company has been profusely investing undeterred by inflation, low GDP and other negative circumstances. While many of its competitors have chosen to trim down the cost or shut down their business, Reliance Retail is on an expansion spree. It will come to the fore by focusing on hypermarkets (big- box format) instead of smaller format stores that it adheres to, presently. It has already engaged in buying real estate for the same.
This segment will get the grip in the forthcoming years with the company latching onto increasing its scale and focusing on supply chain integration. The company believes this to be its learning phase and will soon have hands on experience in operating its retail segment, paving way for an unprecedented growth. It has already taken the plunge by collaborating with kirana stores and small retailers to supply products at low rates.