Reliance Industries

Presented By : Group 5
Priyank Bindal
FT171067
Pulkit Gupta
FT173065
Pallav Abhishek
FT171059
Amrit Kumar
FT174011
Amit Singh
FT174009
Amish Dhawan
FT171010
Dipayan Chakraborty FT171041
Amar Karam Chandani FT173011
Namana Tejeshwar Rao FT173055
Venkatesh Shankar
FT171103
Dinesh Singh
FT173030

Foundation
Set up in 1960 by Dhirubhai Ambani as Reliance Trading Corporation.
Started selling spices to sugar, covering everything in between
Later switched to yarn trading in early 60s.
Renamed to Reliance Textile Industries, Rev $12M, Profit $175K
Went public in 1977, Revenue $80M, Profit - $5M

Strategic masterstrokes in textiles

Started exporting goods including rayon fabric at early stages using
connection in Aden.
License to import nylon fibres on favourable terms owing to exports
Vertical Integration Strategy, set up new spinning mill at Naroda.

Early drivers - Quality and Control of the value chain

Far more cost efficient operations compared to competitors

Investment towards modernization, stayed ahead of its rivals.
Strategies aimed towards exports and efficient use of govt. schemes .
Launched brand Vimal to enter retail fabrics

Patalganga : The next step in vertical

integration
- Enter Mukesh
- Outsourcing of
modern tech, no
JV
- Efficient work
culture,
- Focus on saving
time, not money
- Maximum
resource
allocation
- Time value of
money.

Patalganga Plant

- Reliance, one of
the awardees
beating many
heavyweights.

-Relationship and
trust, in key
depts. of the
govt.
- Developed
informal social
network within
the govt.
- Often privy to
policy changes
even before the
press.
- Proactive
decisions

Competitive
Advantage

Manufacturing PFY

- In 1980s,
license to Private
Corporations to
manufacture PFY

PFY to PTA : The next steps in

the chain

- Set up plant for

manufacturing PTA, a
key ingredient for PFY
- Supplied internal
demands, also for
competitors
- Huge capital outlays

- Real tax benefits,

smart accounting
- Non-convertible
debentures to shares
-Scandals setbacks &
controversies
-Decline in profits

-Dhirubhai suffered
stroke in 1986,
-Backs to the wall
went to capital
market,
-set record for new
issues,
-Significant steps in
backward vertical
integration

From Chemicals to oil refineries and beyond

In 1993, Reliance came out with Indias largest IPO - $270 M.
Opened new subsidiary Reliance Refineries with the intent of entering the energy sector.
The refinery at Jamnagar, spread over 5000 acres of land, was established b/w 1997-1999 in a record time at
a cost of $6 B.
The plant at Jamnagar contained a refinery, plants for petrochemical facilities, Indias largest private port,
Depending on productivity and efficiency to get adequate return and market confidence with integration as
a key advantage.
Topped charts in terms of best operating costs, maintenance cost, manpower cost and plant utilization.
Voted as the top petrochemical company globally by Platts.

Mukesh Ambani : Business coupled to

management

Change maker, who dismantled feudal style of management which

prevailed earlier.
Viewed power of scale as a competitive weapon, relied on global
markets.
Favoured best technology at any cost to stay ahead of its rivals.
Recruited and employed young bright engineers and MBA grads
across the world.
Created a world class human resources pool (average age of 41 yrs
as per 2010 records) with a view of attracting, nurturing and

Oil and Gas Ventures: The E&P Story

Successfully bid for some of the blocks in the GodavariKrishna basin in 1999 along with Niko Resources of Canada,
its partner.
Hit big in 2002, discovered the largest gas field in the year
globally.
By 2007, it had discovered 20 field and produced around
20,000 barrels of oil per day.
Reliance held five coal bed methane blocks, and 13 other
blocks in 6 different countries.
By investing in natural gas instead of heavy crude, it touted
its environment friendly image.
In 2010, reliance successfully completed US bond sale of
$1.5 B to finance it shale acquisition.

What future beckons

In 2010, Intelligent repeat of the Jamnagar refinery, which was
another technological marvel built in 36 months and brought down
capital costs per barrel drastically.
Further plans to invest in polyester capacity.
Focus on power generation, hotels and telecommunication as new
alternatives.
Successful bid to acquire stake in East India Hotels
Globalisation the next horizon. Tried investing in Europe and
Africa, but faced multiple setbacks e.g. Trevira - German Polyester,
Lyondell Basell Dutch refining and chemicals company, etc.
Firmly placed in the upper ranks of petrochemical business, yet
challenges lie ahead.
Threat from players from the middle east and China? Sustain
growth? Parlay its E&P position? And many more

Thank You!