In a significant financial development, Reliance Retail Ventures Ltd, the retail division of Reliance Industries, has successfully received the entire subscription amount of Rs 2,069.50 crore from the global investment firm, KKR. As part of this transaction, Reliance Retail Ventures Ltd has allocated a total of 1.71 crore equity shares to KKR. This strategic move has resulted in KKR’s shareholding in Reliance Retail Ventures Ltd (RRVL) increasing from 1.17 percent to 1.42 percent.
Reliance Industries, in a regulatory filing on a recent Saturday evening, confirmed the completion of the subscription process and the allotment of equity shares to KKR. This development follows Reliance Industries’ earlier announcement this month regarding KKR’s investment of Rs 2,069.50 crore in RRVL, which holds the retail business of the conglomerate. This investment represents an additional 0.25 percent stake in RRVL and values the retail arm at approximately Rs 8.36 lakh crore.
KKR, founded in 1976, manages a vast portfolio with approximately $519 billion in assets under management as of June 30, 2023. This investment by KKR marks another significant financial move in the retail sector, reflecting the confidence and potential seen in Reliance Retail Ventures Ltd.
This latest investment by KKR follows Reliance Industries’ receipt of Rs 8,278 crore from Qatar Investment Authority (QIA) earlier this month. QIA acquired around 1 percent stake in RRVL, valuing the retail arm at Rs 8.278 lakh crore ($100 billion). These strategic investments from global financial giants underscore the substantial growth and value creation witnessed by Reliance Retail Ventures Ltd.
In 2020, RRVL successfully raised Rs 47,265 crore (approximately $6.4 billion) from global private equity funds, marking a significant milestone in the retail sector. This fundraising initiative resulted in a 10.09 percent stake in the company and valued RRVL at over Rs 4.2 lakh crore. The investors involved in this funding round included Silver Lake, KKR, Mubadala, Abu Dhabi Investment Authority, GIC, TPG, General Atlantic, and Saudi Arabia’s Public Investment Fund. This fundraising event represented the largest in the sector at that time.
Reliance Retail Ventures Ltd has been on an aggressive expansion trajectory, actively acquiring companies and securing franchise rights for leading international brands in the Indian market. Furthermore, it has been making substantial investments in enhancing its infrastructure and recently acquired the India business of the prominent German retail giant, Metro Cash and Carry.
During the annual general meeting (AGM) of Reliance Industries last month, Chairman Mukesh Ambani revealed that several esteemed global strategic and financial investors have expressed strong interest in Reliance Retail. He highlighted that if RRVL were to be listed on stock exchanges, its current valuation would place it among the top four listed entities in the country.
The impressive growth trajectory of Reliance Retail is underscored by its achievement of surpassing a billion transactions and a registered user base of 249 million. The retail division operates a vast network comprising over 18,500 stores and digital commerce platforms catering to a wide range of consumer needs, including groceries, consumer electronics, fashion and lifestyle products, and pharmaceuticals.
In the fiscal year 2023, the digital commerce and new commerce segments of Reliance Retail played a significant role, contributing 18 percent to its overall operations. The pace at which Reliance Retail has doubled its valuation in less than three years is unparalleled on a global scale, as highlighted by Chairman Mukesh Ambani.
This recent investment by KKR further reinforces Reliance Retail’s position as a leading player in the Indian retail sector and reflects the confidence of global investors in its growth potential. As Reliance Retail Ventures Ltd continues to expand its footprint and offerings, it remains at the forefront of driving innovation and value creation in the Indian retail landscape.
