Dhirubhai’s legacy: A Rs 65,000-crore empire

The Rs 65,000-crore Group has grown by leaps and bounds over the last five decades. The company was conceived with an investment of as less as Rs 15,000, and today, it is the largest private sector company in India. It now boasts of a total sales of Rs 65,000 crore, net profits of Rs 4,400 crore, cash-flow of Rs 6,800 crore and total assets of Rs 55,000 crore. The company also figures in the list of Fortune 500 companies at the 425 mark, with interests in textiles, synthetics fibres, fibre intermediates, petrochemicals, refining, oil and gas, financial services, insurance, power, telecom and infocom initiatives.

Looking forward, the task ahead for the successor of Dhirubhai is to manoeuvre the Group through the 21st century, at the same pace as earlier. New forays into telecom (where it is a late entrant) and biotech will be critical for the Group to develop a strong gameplan. The company is making investments in retailing in the petroleum sector which would ensure huge returns. The company has already chalked out a Rs 500-crore plan for this.

It owns a textile manufacturing facility at Naroda near Ahmedabad in Gujarat, fibres, fibre intermediates and chemicals at Patalganga near Mumbai, polymers, chemicals, fibres and fibre intermediates in Hazira and a refinery at Jamnagar. The Group also has a 30 per cent stake in Panna, Mukta and Tapti oil and gasfields in north-west Mumbai. It has made forays into new initiatives in telecom, power, engineering, procurement and construction, infrastructure, infocom, insurance, coal-bed methane (CBM) and life sciences. It has grown tremendously over the last decade when the Government’s economic reforms set free the country’s business environment from the earlier shackles of licensing, Fera and high taxes.

Since it went public in 1977, Reliance has set several corporate records. One of these is for growth in its assets. Over the years, the company has rewarded its shareholders handsomely. Anyone who resisted the market’s skepticism when the firm went public in 1977, invested even a small amount in debentures and shares, and purchased all subsequent additional rights offerings, has seen his money multiply to well over a hundred times the original investment.

In 1985, Reliance notched the record of collecting Rs 400 crore from an estimated 1.5 million investors through the issue of non-convertible debentures. Today, nearly three million people hold shares in RIL and its sister concerns. In 1985, Reliance notched the record of collecting Rs 400 crore from an estimated 1.5 million investors through the issue of non-convertible debentures.

The group owns the world’s largest grass root refinery at Jamnagar in Gujarat with a capacity of 27 million tonnes per annum. It is the first and the only refinery to be set up in the private sector in India. The company is also expected to hike capacity to 54 million tonnes in the Tenth Plan. The group is today India’s largest business house and has been chosen as ‘India’s Most Admired Business House’ in the Taylor Nelson Sofres-Mode survey for 2001, conducted for Business Barons magazine, June 2001.

With the merger of Reliance Petroleum Ltd into RIL, the merged entity has the distinction of becoming India’s first private sector company to feature in the internationally tracked Fortune Global 500 list of the world’s largest corporation. The merged entity also ranks among the top 225 companies globally in terms of net profits, among the top 300 companies globally in terms of net worth among the top 425 companies globally in terms of assets and among the top 500 companies globally in terms of sales.

Reliance is the largest exporter from India, with exports crossing $2 billion. The company already exports to over 100 countries, which displays its global competitive strength—a dream that its founder Dhirubhai would have loved to pursue.