Archive for June, 2013

Reliance Jio partners With Global Bigwigs For 4G Launch

June 21, 2013

Reliance JioInfocomm, the telecommunication arm of Reliance Industries Limited (RIL), has partnered with global companies like Samsung, Ericsson, and Alcatel Lucent to build up a full-fledged 4G ecosystem. Alcatel Lucent has got GPON, FTTx and metro DWDM while Samsung has bagged the radio access and packet core network part. Ericsson will look after the managed services part. However the Indian 4G ecosystem is in infancy -stages and a huge roll-out is expected from JioInfocomm. It has already signed a deal with the global smartphone leader, Samsung to make entry-level smartphone devices in medium budget range. The South Korean global giant is the latest entrant in the telecom equipment market. Apart from this it also commenced the network operations in Mumbai and Delhi. This deal will also bring down the prices of LTE devices substantially.

Alcatel Lucent, European equipment manufacturer, is actively helping JioInfocomm in its experimental processes. The third company, Ericsson has been working with MukeshAmbani led Reliance JioInfocomm for Wi-Fi hotspots. Ericsson also recently acquired BelAir. Post acquisition the company has refocused itself on the Wi-Fi segment with a strong carrier-grade WiFi portfolio, technological expertise, IPR, new customer base and market relationships.“This is for deployment in Delhi and Mumbai only right now but it is likely to be expected to other cities as when they launch. Ericsson would be setting up around 200 Wi-Fi spots as part of the deal,” said an official from Ericsson. Other noted players like Nokia Siemens Network, Chinese vendors like Huawei and ZTE are not the part of the deal.

Mukesh Ambani announced in the recently held RIL’ Annual General Meeting that India will become number one in digital content delivery. He also added that 4G network will change the lives of 1.2 billion Indians forever. To cope up with the challenges and to stipulate the launch, JioInfocomm will also recruit around 7,000 people, which will triple its current head count from 3,000. It will become the country’s pioneer to launch pan-India 4G services. The company is planning to launch the services in metro cities like Delhi, Mumbai, Chennai and Kolkata. It has also started preparations to launch the services in 40 other tier 1 and tier 2 cities. Reliance JioInfocomm has charted out an aggressive roadmap for the upcoming year. The company will also invest a total of INR 150,000 crore over the next three years in all its five major verticals.

//

Reliance Retail Set to Create An International Retail Experience

June 11, 2013

Mukesh Ambani led Reliance Industries Limited (RIL) is now aggressively focusing on capturing the retail segment in the country. The energy giant’s retail arm – Reliance Retail is aiming to become second to none in the wholesale market by the end of this year. It has already initiated a furious expansion drive with special focus on the wholesale cash and curry segment. “Reliance Retail plans to take the battle straight to multinational chains operating in the wholesale cash and carry segment and choke them in that area with all its might,” said an official. From the expansion plans of Reliance Retail can be deduced that it will over perform as compared to any non-Indian company in the wholesale business that generates healthy profits effortlessly. For this indigenous upcoming retail giant, wholesale business is now taking top slot in their priority.

Recently, the government issued some clarifications on the multi-brand retail FDI policy that includes foreign retailer’s inability to acquire existing retail businesses and to make new investment of $50 million at least in back-end infrastructure. These changes however will affect the international giants from capturing the regional market immediately and will restrict them to cash and carry segment only.

A senior official from a foreign cash and carry company said, “The hearsay is they (Reliance) want to become the number one player in wholesale by the end of the year.” Another senior official from Reliance said that the expansion plans for Reliance Retail were announced during the annual general meeting of the company held earlier in this month. The company has set targets for the employees to drive revenues across all costs. “They are not doing this business for now; they are looking at the next ten year horizon. In that sense, they are headed towards becoming Indian Walmart,” added the official.

The cash and carry segment on which Reliance is focused at the moment holds a great future in India. According to industry experts’ estimation, cash and carry in India will become a $22 billion market by 2017 and the market leader in this segment will do a business of about $4-5 billion in yearly turnover. With over 10,800 crore in annual sales, Reliance is just 2,000 crore away from its biggest competitor Future Retail. The company also got Randy Guttery, a former managing director for Metro in Vietnam, on board to head the enterprise.

As a step towards execution of expansion plans, Reliance Retail plans to open 15 more stores from the current store count of 1466. It plans to open more stores in between April and September. Some of them are already being operational. Reliance Retail will soon become the country’s leading retail chain.

//

Reliance targets to get 40 % of Revenue from Its Retail and Telecommunication Ventures

June 6, 2013

Reliance Industries Limited (RIL) is the country’s biggest energy giant. Nearly 97percent of the company’s revenue arrives from its petrochemical venture. This year, MukeshAmbani is focusing to expand its retail and telecommunication ventures too. He is expecting to increase the share of his group’s revenue from Reliance Retail and Reliance JioInfocomm to as much as 40 percent from the current contribution.

In the previous financial year that ended on March 31, a total of $70 billion revenue was obtained from RIL’s refining, petrochemicals and natural gas exploration businesses. The company is now looking in the direction to capture the emerging markets and raising levels of income in the country. “Reliance is seeking to benefit from growing consumerism in India. It is important for Reliance to diversify into unrelated businesses so it can hedge its risks and avoid possible crisis in the future,” said R.K.Gupta, Managing Director of Taurus Asset Management Ltd.

Reliance will soon launch its 4G services to tap business from middle-class consumers that PricewaterCoopers predicts will reach a number of 570 million users by 2021.MukeshAmbani’s vision to focus on other businesses sets him apart from other global energy giants. For a smooth and successful launch of its 4G services across the country, JioInfocomm is leaving no stone unturned. It has signed deals with technology companies, service and infrastructure providers and device manufacturers. “Telecom has always been the pampered baby for MukeshAmbani and his father before him. The company has previous experience in telecom and investing their large cash in businesses that will improve the return on equity, even if on unrelated business, is welcome,” said K.K Mital, a New-Delhi based fund manager with Globe Capital Market Ltd.

Apart from this, Ambani is also focused on its retail business which deals in grocery stores, hypermarkets, jewellery, electronic goods and many other specialized store formats. In the annual report, Ambani mentioned that he is expecting a fivefold increase in retail sales. Currently, Reliance operates 1,450 outlets across 129 cities in the country. The market estimation is that it will grow twice to $850 billion by 2020 from $435 billion in 2010. Reliance Retail is expanding its fleet by capturing consumers in tier-2 and teir-3 cities by giving them a world class shopping experience.

RIL is sprinting to achieve the same success of energy sector in retail and telecommunication sectors.

//