reliance industries - overview
DESCRIPTION
A presentation on Reliance Industries, before and after the split.TRANSCRIPT
RELIANCE INDUSTRIES“PURSUE YOUR GOALS EVEN IN THE FACE OF DIFFICULTIES, AND CONVERT ADVERSITIES INTO OPPORTUNITIES." - DHIRUBHAI HIRACHAND AMBANI.
Presented By:Sheryl(94)Smitha(97)Subasri(104)Upasana(112)
AGENDA Introduction
Current news The split
Mukesh Ambani’s group ADAG Gas Row in Detail SWOT BCG Recommendations Summary and Conclusion
INTRODUCTION India's largest business house Exports to more than 100 countries
the world over Reliance Group revenue is equivalent
to about 3.5% of India's GDP Largest polyester yarn and fibre
producer in the world Among the top five to ten producers
in the world in major petrochemical products
THE RELIANCE GROUP COMPANIES INCLUDE: Reliance Industries Limited Reliance Retail Limited Indian Petrochemicals Corporation Ltd. Reliance Capital Limited Reliance Industrial Infrastructure Limited Reliance Telecom Limited Reliance Infocomm Limited Reliance General Insurance Company
Limited Reliance Power and Reliance Energy Limited. Other Businesses and Subsidiaries
CURRENT NEWS RIL opts for consent route to settle insider-
trading issue RIL Chairman has set his eyes on no-frills,
low-cost housing. The initiative, still on the drawing board, could be kicked off by 2010.
The country’s biggest global acquisition if it emerges as the successful bidder for bankrupt LyondellBasell - one of the world’s largest polymers, petrochemicals and fuels company
Reliance Industries has reopened 900 gas stations, which were shut down when state firms were selling heavily subsidised fuel
The bid for the privatization of five airports was won by the Anil Ambani group's Reliance Airport Developers Ltd (RADL)
Flag Telecom is now part of Reliance Globalcom. On the 30th December 2008, Reliance
became the first telecom company in India to operate in both CDMA as well as GSM technologies.
The Reliance group’s Javagreen coffee retail chain, is run by Ambani sister Nina Kothari and brother-in-law ,B H Kothari ,along with Reliance’s WebWorld stores
Mukesh Ambani’s next foray: Education. Planning to launch a private university
Alliance with Brad Pitt’s production house, Plan B -
CSR Initiatives:1. CSR activities at Jamnagar2. Dhirubhai Ambani SSC - Merit Reward
Scheme & Dhirubhai Ambani Undergraduate Scholarship Scheme
3. 'Reliance Kargil Scholarship Scheme‘4. Healthcare Initiative- Blood donations,
free medical check up etc5. Mukesh plans to setup a Rs 500-crore
Reliance Foundation to address the social development imperatives of the country
THE BEGINNING Founded in 1958 as a textile company. Brought about the equity cult in India. Sectors involved: petrochemicals, textiles,
production of crude oil and gas, polyester and polymer products .
Also in Telecom, Insurance and Internet Businesses, the Power Sector, Infrastructure
Dhirubhai has been one among the select Forbes billionaires and has also figured in the Sunday Times list of top 50 businessmen in Asia.
Backward vertical integration has been the cornerstone.
THE SPLIT
July 2002 Dhirubhai Ambani dies
November 2004 Feud becomes public
June 2005 Settlement brokered by Kokilaben
2006 Split: Mukesh = RIL; Anil = RNRL
July 2008 Mukesh claims shares in Reliance Communications
THE SPLIT Following Dhirubhai’s death in 2002, the
empire was split between the two sons Mukesh Ambani and Anil Ambani
Mukesh Ambani got RIL and IPCL – Reliance Industries, also owner of Mumbai Indians
Anil Ambani heads the Reliance Capital, Reliance Energy and Reliance Infocomm - Anil Dhirubhai Ambani Group (ADAG)
MUKESH’S KITTY
Reliance Industries Limited
Indian Petrochemical Corporation Limited (IPCL)
BUSINESSES
Exploration & Production
Petroleum refining & Marketing
Polymers
Polyesters
Polyester intermediates
Other Petrochemical
s
Petrochemicals
Textiles
Retail
MUKESH AMBANI’S GROUP
Reliance Industries Limited
Reliance Retail Limited
IPCL- Shares
MAJOR SUBSIDIARIES AND ASSOCIATES OF RIL
Reliance Petroleum Limited
Reliance Retail Limited
Reliance Global Management Services (P) Ltd
Reliance Biopharmaceuticals
Ranger Farms Ltd
Reliance Engineering Associates (P) Ltd
Reliance Oil & Gas Find (Petrochemicals Business)
JAMNAGAR REFINERY
Private sector crude oil refinery owned by RIL
Commissioned on 14 July 1999
Installed capacity 661,000 barrels/day
Largest greenfield refinery in the world
Jamnagar- ‘Refining Hub of the World’ (1.24 mn barrels per day)
RELIANCE PETROLEUM LIMITED
Strategic alliance with Chevron India Holdings , Singapore (5% equity stake)
Refining activities carried out at Jamnagar with refining capacity of 27 mn tonnes p.a. (540000 barrels/stream day)
Annual crude processing capacity of 580000 BPSD(Barrels Per Stream Day)
Sixth largest refinery in the world
Processes wide variety of crudes
• Very light to very heavy(18 to 45 degree API)• Sweet to very heavy (Sulphur content from 0 to 4.5%)
Awarded ‘International Refiner of the Year’
Nearly zero-emissions refinery
PERFORMANCE REVIEW OF RPL
Product FY2008-2009 FY2007-2008Gases and distillates 28000 28500Fuel oils 4500 4600Total production 32450 33100
RELIANCE RETAIL LIMITED
Pan-India network of retail outlets in multiple formats
A world class shopping environment
State of art technology and Seamless Supply Chain infrastructure
Host of value-added services and unmatched customer service
BRANDS UNDER RELIANCE RETAIL
RELIANCE FRESHfood and grocery specialty store
RELIANCE FOOTPRINT
-footwear specialty store
RELIANCE TIME OUT- books, music and entertainment
RELIANCE DIGITAL – electronics
specialty store
RELIANCE WELLNESS
health, wellness and pharma
specialty
RELIANCE TRENDZ-apparales
specialtyRELIANCE AUTOZONE
RELIANCE SUPER-mini hypermarket
RELIANCE MART all under 1 roof
supermarket
RELIANCE I-STORE- exclusive
apple storeRELIANCE HOME
KITCHENSRELIANCE JEWEL -
jewellery
RELIANCE GLOBAL MANAGEMENT SERVICES (P) LTD
Fast growing IT solutions and services provider with business
offices in USA, Hyderabad(India)
ERP, SAP, Application maintenance and
support, management-consulting services
Contract staffing as well as in-house competency
development
RELIANCE BIOPHARMACEUTICALS Reliance Biopharmaceuticals Reliance Life Sciences (Rabale, India)
Protein manufacturing facility at the Dhirubai Ambani Life Sciences Center at Rabale, near Mumbai
Investment plans of above Rs 9 bn ($200 mn)
Mamallian cell + Microbial fermentation technology = proteins
Initial capacity for 10,000 litres of mammalian cell culture and 1000 litres of microbial cell culture
RANGER FARMS LIMITED
Reliance Fresh likely to be added to Ranger Farms
Deals in food, fruits and vegetables and consumer
products
Some verticals are expected to be hived to
reap higher profits
RELIANCE ENGINEERING ASSOCIATES PRIVATE LIMITED (REAL) Engineering procurement and construction Services
Part design for molding Mold design Prototype Product tooling Pre-production prototyping Full-scale manufacturing of precision thermoplastic and thermoset plastic parts Contract manufacturing services for OEMs
Procurement Build-to-print assembly of low to moderate volume products
RELIANCE'S OIL & GAS FIND Natural gas in the Krishna Godavari basin off AP near Vishakapatnam in
2002
Largest discovery of natural gas in the FY 2002-2003
Natural gas production from D-6 block in the KG basin commenced
on April1,2009
7 trillion cubic fit in size, equivalent to 1.2 bn barrels but
only 5 trillion cubic feet extractable
On Oct8,2008 RNRL took RIL to the Bombay HC to uphold a MoU
PETROCHEMICALS
Polymer (PP, PE and PVC) production volumes decreased by 9% to 3076 KT due to planned shutdown of PP plant at Jamnagar in October 2008
1755 KT of ethylene and 696 KT of propeylene , a decrease of 7% each year due to lower Propane Cracking
Polyester (PFY,PSF and PET ) production volume decreased by 2% to 1534 KT
Focus on specialty products which accounts for 55% of PSF and 38% of PFY production
RIL’s fibre materials (PX,PTA,MEG) production decreased by 3% to 4583 KT
Revenue from the segment decreased marginally from Rs 53000 crores to Rs 52767 crores (US$10.4bn)
INDIAN PETROCHEMICAL CORPORATION LIMITED (IPCL) RIL formally assumed control of IPCL in June 5, 2002 after which
Reliance’s controlling share was 47.3% IPCL was managed by a board nominated by the govt till 2002 and 26% of
the equity shares was divested in favor of Reliance Petroinvestments Ltd through a bidding process
6 polyester companies amalgamated with IPCL Appollo Fibres Ltd (AFL) Central India Polyesters Limted (CIPL) India Polyfibres Limted (IPL) Orissa Polyfibres Limted (OPL) Recron Synthetics Limited (RSL) Silvassa Industries Private Limited (SIPL)
Battle between the brothers over the then Rs 90,000 Crores Reliance empire Merger at a swap ratio of 1:5
TEXTILES
Flagship brand – Vimal Shepherding a new era in fabrics New product initiatives:
Fresca anti-microbial and anti-bacterial work-wear apparel fabricsHome furnishing and auto-textilesSilk-Amino suiting fabricsFire-retardant and water-repellent tent fabrics for defence/ police
services
Insect & mosquito repellent nets, as per WHO standards, which will find usage in several areas of the world affected by mosquitoes / insects
IN ANIL’S CORNER
ADAG
RNRL
Reliance Communications
Reliance Capital
Reliance Infrastructure
Reliance Power
Reliance Entertainment
Reliance Health
ADAG ranks among India's top three three private
sector business houses. has a market capitalization of US$ 22 billion,
net assets in excess of US$ 7 billion, and net worth to the tune of US$ 6 billion.
Has a customer base of over 50 million, the largest in India
Spread over 4,500 towns and 300,000 villages in India, and 5 continents across the world.
RNRL incorporated on March 24, 2000 as Reliance
Platforms Communications.Com Private Limited
Engaged in the business of sourcing, supply and transportation of gas, coal and liquid fuels
RNRL has been awarded four CBM blocks, with an acreage of about 3,251 sq. kms, for the exploration and production of coal bed methane (CBM), making it the second largest CBM player in India in terms of acreage.
RELIANCE COMMUNICATIONS Reliance Communications, formerly known as
Reliance Infocomm flagship venture along with Reliance Telecom is part of Reliance Communications Ventures (RCoVL).
Began operations in 1999 and has over 50 million subscribers today
Offers a complete range of integrated telecom services also broadband services.
Offers both CDMA and GSM services in fact the first telecom company in India to operate in both technologies
Wireline Business throughout India and has the largest optical fibre communication (OFC) backbone architecture [roughly 110,000 km] in the country.
RelCom has its presence across all B2C communications channel in one of the fastest growing markets in the world.
Also is the first telecom operator in the history of Indian telecommunications to simultaneously launch its GSM services in 17 circles
Reliance Globalcom, a division, owns the worlds largest private undersea cable system.
RELIANCE INFRASTRUCTURE Earlier called Reliance Energy India’s largest private sector enterprise in power
utility Focused on roads, Urban infrastructure (Sealink
and Airports), Specialty Real Estate (business districts, trade towers, convention centre), and SEZ (IT & ITES SEZ and non IT SEZ) as well as FTZs.
Executing the first 100% private sector power transmission project for western grid
Emerging as one of the leading players in India in the Engineering, Procurement and Construction (EPC) segment of the power sector
RELIANCE POWER Subsidiary of Reliance Energy Established to develop, construct and
operate power projects domestically and internationally
Currently developing 16 large and medium sized power projects with a combined planned installed capacity of 33,780 MW
Sole distributor of electricity to consumers in the suburbs of Mumbai
The 7,480 MW project to be located at Dadri in Uttar Pradesh is expected to be the largest gas-fired power project at a single location in the world.
The Sasan project (Madhya Pradesh) is a 6x660 MW coal fired generator and is currently under construction and is planned to be completed in a span of less than five years
The 3500 MW Power Plant, Dadri in UP was set up in 2004 in the Ghaziabad District; aimed to be the biggest gas based power plant in the world.
RELIANCE ENTERTAINMENT Mostly comes under the BIG banner. Includes Reliance Big Entertainment, Big
Pictures, Big Music and Home Entertainment, Bigflix.com, and Bigadda.com. Soon it will also have Big Broadcast, Big TV, the DTH business, and Big IPTV.
The BIG name started off with the now household name - Big 92.7 FM
Big Pictures will spend $ 1 billion in producing 10 mainstream Hollywood films by 2010
Also spend another $300 million on 69 Hindi and regional language films.
Bigflix.com, an online DVD rental company, will spend $100 million in setting up 300 stores across the country.
The group has also announced a $ 500 million investment in the IPTV business along with Microsoft
Also into content distribution and delivery owns 200 cinema screens in the US, 51 in
Malaysia and 167 in India Also will increase his Zapak gaming cafes from
21 to 700. Also has launched its Direct To Home (DTH) TV
also, known as "Big TV".
Investing Rs. 6,800 crore, comprising a chain of medicine retail stores, four hospitals in West Bengal, Bangalore, Delhi and Mumbai, and two medi-cities in Jaipur and Nagpur.
Plans to act as a ‘national distributor’ for local and foreign drug manufacturing companies, and source drugs directly from the manufacturers to hospital pharmacies and retail chemists.
Medi Assist, a Third Party Administrator (TPA) for health insurance, forms a vital link connecting stakeholders across healthcare delivery.
RELIANCE HEALTH
OTHER BUSINESSES Reliance BPO is a premium BPO & KPO
service provider offering cutting edge solutions to global Communications, BFSI, Utility and Entertainment industries.
The Mudra Group, engaged in advertising, has more than 125 clients nationwide with three creative agencies, eight full service offices, seven specialised business units and an integrated media offering.
MOVING AHEAD ADAG will invest a whopping sum of Rs
40,000 crore in power sector, cement industry, cargo handling airport and technical institute in Madhya Pradesh.
Dreamworks – R-ADAG joint venture worth $700 mn.
Launch of BigOye.com and the tie-up with Future Group.
RELIANCE CAPITAL A constituent of S&P CNX Nifty and MSCI India One of India's leading, most valuable and fastest
growing privates sector financial services companies Has interests in asset management and mutual
funds; life and general insurance; private equity and proprietary investments; stock broking; depository services; distribution of financial products; consumer finance etc.
Subsidiaries Reliance Mutual Fund Reliance Life Insurance Reliance General Insurance Reliance Money Reliance Consumer finance
THE DISPUTEBattling over
the delivery of gas from the Krishna Basin
Mukesh wants to revise the
price of gas at which Anil can buy from him
Price agreed upon is below market rates
deal was vetoed last year by the
Petroleum Minister Murli
Deora
Anil accused the minister of
being in league with his brother
Mukesh counters that
his brother must have known that the price would
fluctuate
Manmohan Singh has urged them to put the
nation’s interests on top
Seen as a case of corporate
greed, resulting in higher prices
of power
Hopes rest with Kokilaben
SWOT ANALYSIS
• Growing market• Political stability• Strong currency
• Substitute products• Trade barriers• High cost of funds
• No innovative products
• Lack of patent protection
• Operational inefficiencies
• Advanced technology• Strong R&D Base• Capacity utilization
Strengths
Weakness
Opportunities
Threats
BCG MATRIX
• Reliance oil & gas• Reliance
biopharmaceuticals• Ranger Farms Ltd
• Reliance Petrochemicals
• Reliance petroleum• Jamnagar refinery• Reliance global management
services• Reliance engineering associates
(P) Ltd• Reliance Retail Limited
Star (high growth, high market share) Question mark(high growth, low market share)
Cash cows (low growth, high market share)
Dogs (low growth, low market share)
BIBLIOGRAPHY http://www.whatisindia.com/issues/reliance/in
dex.html http://www.iloveindia.com/economy-of-india/t
op-50-companies/reliance-group.html)
http://www.business-standard.com/india/news/reliance-ipcl-boards-approve-15-swap-ratio/277292/ )
http://valuenotes.com/valuenotes/research/articles.asp?cap=43&cn=35&next=2
http://en.wikipedia.org/wiki/Reliance_Capital http://inhome.rediff.com/money/2005/jun/21s
ld5.htm
VIDEO LINKS http://video.filestube.com/video,d3bc1489de
a68a2003ea.html- Conflict
http://www.youtube.com/watch?v=sE_bREd0WxU- Abt Dhirubhai Ambani and formation of reliance