Archive for August, 2013

Now an Unified License for Reliance Jio

August 30, 2013

Reliance Industries Limited (RIL) is leaving no stone un-turned for the launch of its 4G telecom services, Reliance Jio Infocomm Limited (RJIL). It has recently applied for a Unified License (UL) which will enable the company to offer complete telecom service, including voice.

Earlier, this telecom venture was permitted to offer only the Long-Term Evaluation (LTE) or fourth generation (4G) service. However, the company was not permitted to offer voice services over Broadband Wireless Access (BWA) spectrum. Now, this application for UL will increase competition in the over-crowded telecom sector in the country. As the UL is now linked with spectrum, Reliance will be able to offer all telecommunication services using the spectrum. This spectrum was bought by RIL for Rs 12,847 crore in 2010 for all the telecom zones in India.

With the new UL, Reliance Jio will become the first company in the country to have BWA spectrum for all the telecom zones in India. The company will shell out Rs 1,600 crore for this license. Currently, RJIL is focusing to develop its 4G-LTE technology which will provide voice in the 20 megahertz spectrum in the 2.3 gigahertz band. This spectrum band was previously used to transmit data.

At the shareholder’s meeting, Mukesh Ambani had announced that the 4G services will be rolled out in mid-2014. He said, “India’s future is going to be digital. In near future everything done digitally is transformed to a value-creating and life-enriching experience across all strata of the society. This new telecom company will drastically change the lives of 1.2 billion citizens of the country.”

It has already invested around Rs 18,000 crore in the telecom sector and further details about the product and the launch will be shared in the next AGM in June 2014. “Together with our partners, we have charted an ambitious plan for the next 12 months, and we at Reliance Jio foresee making rapid progress over the period towards launching our services across India,” he said.

Reliance Jio Infocomm has finalized its key vendors, device partners, manufacturer and technology partners and infrastructure partners for the initial launch of its services pan-India.

RJIL will start the testing of its messaging feature on the fourth-generation long term evolution, or 4G LTE platforms, the approval of the same came from the Department of Telecommunication (DoT). It has also demanded 10,000 numbers from the government to test its services.



Reliance Retail Tops Indian Retail Market

August 22, 2013

The retail arm of Reliance Industries Limited (RIL), Reliance Retail has become the country’s topmost retail chain. The company led by Mukesh Ambani has reported growth due to its presence in numerous formats.

Reliance Retail announced revenue of Rs 3,474 crore for the quarter which is a 53 percent jump from the revenue earned in the same quarterduring last year. It has reported an operating profit of Rs 70 crore. “Reliance Retail’s faster growth is attributed to its presence in a large number of formats and its ability to scale fast,” said DhvaniBavishi, analyst at domestic brokerage ICICI securities.

The biggest drivers in this growth are cash-and carry stores developed by the retail chain. Known as Reliance Market, the first cash-and-carry store opened in Ahmedabad in September 2011. At the end of 2012-13, 56 percent of Reliance Retail’s revenue of Rs 10,800 crore came from its value segment that operated grocery chains like Reliance Fresh, Reliance Super and Reliance Hyper. The company is rapidly expanding its cash-and-carry segment. It has opened six stores in the June quarter, which helped the company to gain a 53 percent growth in revenue. The cash-and-carry segment in our country was previously dominated by global retail giants. The retail arm of Reliance is the first Indian company to have entered in this segment. Reliance Retail has been operational since last eight years and it has achieved the topmost position in the industry in a short span of time. The company is strategically divided in phases like 1.0, 2.0, 3.0 and 4.0 and caters in specified business segments like value, digital, lifestyle, jewellery and brands.

At the last annual general meeting, MukeshAmbani said, “We want to make retail business as one of our growth engines over the next few years. I am confident that our retail business would undertake multi-fold growth in the next few years by delivering over 50 percent revenue growth in various format sectors year-on-year and is on its way to achieve revenue target of Rs 40,000-50,000 crore as shared by me in our last AGM.”

As a part of its expansion strategy, RIL has added 184 stores across format sectors. It is also planning to capture the consumers in tier-2 and tier-3 cities. Currently, the company owns around 1,500 stores in 130 cities across the country. “Our multi-format strategy is paying huge dividends with most of the formats having positioned themselves as market leaders and is poised for strong growth in the future.” added Ambani.


RIL To Set Up Aerospace Unit In Hyderabad

August 14, 2013

Reliance Industries Limited (RIL) is planning to set up the country’s first aerospace unit in Hyderabad. This aerospace arm of Mukesh Ambani owned RIL is known as Reliance Aerospace Technologies Private Limited. Its officials have contacted the Andhra Pradesh government to provide land in or near Hyderabad to build this aerospace manufacturing unit.

“Reliance Aerospace Technologies contacted us with a request for allotment of land, equipped with an airstrip, in or around Hyderabad to test their equipment. We have identified two places on the outskirts of the city,” said a top government official. As a part of this request, the government has asked its officials to identify suitable land for Reliance. The government authorities have identified two sites in Hyderabad for Reliance. The preferred location for the energy giant will be a place attached with fully functional air strip. A place called Dundigal, where the Indian Air Force has an airstrip, is under consideration. A high level delegation from Reliance will visit the city in the coming week to finalize the location. According to analysts, Reliance is showing interest in Hyderabad because there is availability of abundant skilled manpower and also infrastructure required for high technology aerospace market. Hyderabad has HAL and other defense establishments from where Reliance wanted to grab manpower.

Reliance incorporated this new firm to enter into aerospace and defense market. This aerospace venture has a cash reserve of Rs 82,975 crore. It is registered with the Registrar of Companies and has also applied for a license with Department of Industrial Policy and Promotion to design and develop equipment and components like airframe, engine, radars and many others for both civilian and military aircraft and helicopters. In order to come up with new strategies in the defense play, Mukesh Ambani is planning to invest about $1 billion in the aerospace field over the next three years. The company is also planning to recruit 2,000 engineers.

Reliance Aerospace Technologies Private Limited might plunge into manufacturing of supplies that are needed by its joint venture partner Boeing. This global aerospace giant has defense contracts in India worth billions. Apart from this deal, RIL had also partnered with Dassault Aviation in 2012, to enter defense and home land security sectors in India. Both these companies are in offset arrangement pact with RIL. According to the government’s defense procurement policy, the multi-national companies are bound to plough back to India a fixed percentage of the value of the contract they win from Indian defense.


RIL May Bid to Buy Stake in Haldia Petrochemicals Limited

August 5, 2013

Reliance Industries Limited (RIL) plans to bid for 31 percent stake ownership in beleaguered Haldia Petrochemicals Limited (HPL). The West Bengal government has decided to sell away its stake of 31 percent in HPL. Earlier the government had announced for the companies to submit their expression of interest to buy this stake. RIL had already submitted its expression of interest for the stake and will now bid its price in the month of September.

Currently, there is a legal battle going on between The Chatterjee Group (TCG), a joint promoter of HPL and the state government over the control of the company. Until legal battle reaches a conclusion, the Calcutta High Court has permitted the state government to sell the un-disputed stake of 31 percent.

For Mukesh Ambani led RIL, a stake in HPL plant will be beneficial. The plant is located near Kolkata and has a production capacity of about 65 percent of its total installed capacity. Apart from this, RIL produces naphtha- the feedstock used to produce valuable chemical compounds. The energy giant will be able to supply naptha from its Jamnagar refinery to this HPL plant and cater to the demand for petrochemicals in the eastern region.

In addition to this, RIL is also vying to purchase 30 offshore oil and gas blocks in Myanmar. According to Myanmar’s Energy Ministry, 11 shallow water and 19 deepwater blocks have been put up for international and national companies to bid. Last month, the shortlisted firms had been called to view data on these blocks. Reliance has viewed the data on the blocks on July 25. Data viewing will continue till the first week of August 2013. The Myanmar government will start awarding the acreage in the early half of 2014. The notice from the Myanmar Energy ministry said that for shallow water blocks, the qualified bidding companies will have to partner with at least one Myanmar owned company, while the bidders can invest directly for the deepwater blocks.

At the last Annual General Meeting, Mukesh Ambani had announced that there will be major focus on the expansion of its core businesses which comprise of oil, gas, refining and petrochemicals sectors. About 82 percent of the total investment of 1.5 lakh crore will be used in these sectors. RIL is gaining good ground in its US Shale gas business too. RIL is looking forward to an upsurge of its stake in the domestic as well as the international energy market for the next three years.