Reliance Industries Limited (RIL) is a private Indian multinational conglomerate business based in Mumbai. Regarding market capitalization and sales, Reliance Industries is India's most profitable corporation and the country's largest publicly traded firm. It is India's tenth largest employer, employing over 236,000 people. RIL has a market capitalization of US$243 billion as of October 2021. The company is ranked 155th on Fortune's Global 500 list of the world's largest firms in 2021.
Reliance is responsible for over 5% of the entire customs and excise tax income collected by the Indian government. It is also the private sector's top income tax payer in India.
RIL has improved its dominant position in various more minor fashion and lifestyle industry markets. The corporation has recorded a twofold increase in income from small-town retailers. JioMart is currently connected with over 400 retailers, with daily orders increasing by over 2x quarter-on-quarter. Lets get a glance at some of the Reliance projects that failed in market.
Reliance Failed Projects
Reliance Refining is in a significant crisis.
The petrochemicals division, which only a few quarters ago became RIL's largest EBIT (earnings before interest and taxes)-generating vertical, has grown by 42.9 per cent to Rs 8,221 crore in EBIT. In comparison, refining's EBIT declined 18% to Rs 5,055 crore. Revenues from the refining and petrochem verticals also climbed under the 10.4% increase in the average Brent oil price in the third quarter. In a news release, Chairman Mukesh Ambani mentioned "heightened volatility" in the oil price as one of the issues.
The benchmark Singapore complex margin averaged $4.3 per barrel in the third quarter, down from $6.1 in the second quarter and $7.2 in the third quarter of 2017-18. " Singapore margins were driven down by a fall in light distillate cracks, despite advances in fuel oil and intermediate distillate cracks ", In a statement, RIL said. OPEC's increased crude oil output also negatively impacts crude oil benchmarks.
Another concern for the corporation is oil and gas exploration and production (E&P). The segment's revenue decreased by 27.5% to Rs 1,182 crore. However, the company's EBIT loss remained at Rs 185 crore. The loss during the second quarter was Rs 480 crore. RIL has invested Rs 40,000 crore in its Krishna Godavari blocks with its partner BP Plc to revive E&P activity, but it has failed to persuade investors.
Biyani, known as the "Father of Indian Organized Retail," employed aggressive pricing to lure middle-class customers to his outlets, including Big Bazaar, Central, and Brand Factory, and built a retail behemoth. However, his enterprises were saddled with net debt of Rs 12,989 crores, with the promoters' total equity committed to lenders.
"We required a holistic solution rather than a solution in a certain format because our businesses were so interwoven." As a result, this was probably a reaction to our presence." On a turnover of Rs 3,860.4 crore, Reliance Fresh Ltd lost Rs 273.8 crore."
Reliance Retail, India's big fish, maybe exit the jewellery business. The corporation run by business mogul Mukesh Ambani is up against stiff competition from regional rivals, which might force it to shut down its jewellery retail operation. It now conducts its retail jewels business under the 'Reliance Jewels' brand from over 50 locations around the country.
Reliance Retail, the retail arm of Reliance Industries, has closed roughly ten Reliance Jewels stores, including several of the brand's flagship locations on Hughes's Road near Ambani's 27-story mansion Antilia in South Mumbai and Park Street, Kolkata's historic high street.
According to people close to the stores, Reliance Jewels have not impacted the domestic jewellery industry, which requires a brand to remain dedicated for years. Meanwhile, regional players began to expand rapidly. Reliance Retail continues to close more jewellery stores, which may be the end of their narrative in this category. A message was submitted to the Reliance Retail representative by a well-known newspaper. However, it received no answer. The Indian jewellery market is one of the country's fastest-growing sectors since it is the world's top importer and consumer of gold.
- However, in Reliance Trends's market wishes to enter, competition is fierce. Retailers such as Landmark Group's Max and hypermarkets such as Big Bazaar and More sell value items in the mid-market. Cantabil Retail, a recently listed company, is likewise pursuing a similar strategy of accessing tier-II towns and attracting middle-class customers. In the current fiscal year, it expects to open 180 outlets.
- On a sales of Rs 489 crore, Reliance Trends, which operates apparel boutiques, lost Rs 11.35 crore on a turnover of Rs 1,234 crore.
Reliance Time Out
Shops that offer books, music CDs, and stationery find it challenging to come up with new ideas as online shopping becomes more popular. Due to fierce competition from online shopping portals and a drop in client base, Reliance TimeOut, a one-stop store for books, music, toys, and stationery has halted operations and is forced to close down.
Reliance Health Insurance
Reliance Health Insurance, Reliance Capital's separate health insurance unit, has been ordered by India's Insurance Regulatory and Development Authority (Irdai) to transfer its entire portfolio to Reliance General Insurance and has been barred from selling new plans.
Reliance Health Insurance was reported to have a solvency margin of 106 per cent in the June quarter (Q1FY20), significantly below the statutory threshold.
One hundred fifty per cent, according to Irdai. Since then, the solvency margin has fallen even more, to 77% in August and 63% in Q2FY20.
With effect from November 15, the regulator has also instructed Reliance Health Insurance, which began operations in October 2018, to transfer all policyholder investments and its financial assets to Reliance General.
Threats develop when situations in the external environment jeopardize the organization's business's dependability and profitability. These external influences might have a significant impact on the company's performance. Still, Reliance has impacted the economy and may lose clients as a possibility due to the current scenarios and the current trajectory of Reliance. But, Reliance is known to bring customers mainly due to the inexpensive costs it offers. One such example is the market response to removing free services—but Reliance Jio won the market and is now linked to a slew of freebies. There may be a decline in sales for the firm if these are eliminated.
What are the failed products of Reliance?
Some of the failed products of Reliance are:
- Reliance Fresh
- Reliance Jewels
- Reliance Trends
- Reliance Time Out
- Reliance Health Insurance
What is the main business of Reliance Industries?
The core business of Reliance industries is petrochemical, refining, oil and gas-related operations.
What are the products of Reliance Industries?
Some of the core products of Relince Industries are:
- Transportation Fuels
- Aviation Turbine Fuel
- Auto LPG
- Fleet Management Services
- Highway Hospitality Services
- Convenience store