Reliance AGM 2022: Succession, spinoff in focus in Mukesh Ambani’s speech

This year, investors in Indian billionaires Reliance Industries Limited, Will seek insights into the group’s 5G rollout, how Ambani plans to unlock the value of his telecom and retail units through individual listings, and when and how his children will take over the reins.

Anticipation is high as the 65-year-old tycoon, who has built Reliance into India’s biggest company by market value and a powerhouse conglomerate, has used the speech in the past for a series of big announcements. These include the launch of their disruptive telecommunications service in 2016, the Saudi Arabian oil company’s proposed investment in Reliance’s energy business in 2019 and a strategic shift to green energy last year.

This year’s shareholder meeting, scheduled for Monday, comes as the refining-to-retail conglomerate faces the twin challenges of a global slowdown and the sharp rise of Gautam Adani, who eclipsed Ambani as India’s — and Asia’s — The richest man earlier this year and is emerging as an alternative power center on the corporate scene.

Reliance investors will have in mind how Adani’s group split its business into separate listings years ago, unlocking value, and the “next big” from Ambani’s more-centralized holdings, Kranti Bathini, equity strategist at Wealthmills. Clarity and specific timeline for things”. The assets of Securities Pvt.

Here’s the news investors are expecting:

succession

The VC indicated that Reliance’s succession planning would be expedited at last year’s shareholder meeting and explicitly reiterated it in December. His three children – daughter Isha and sons Akash and Anant – are already various directors in the group’s unlisted firms and more are visible under his leadership.

Looks to Walton Family Playbook on Ambani Succession

Ambani stepped down as chairman of Reliance Jio Infocomm Ltd in June, making way for his eldest son, Akash, who took charge of India’s largest wireless operator. With rumors about Ambani’s health looming, investors will be looking to take a more concrete step on the leadership change, with Isha, Anant and possibly Ambani’s wife Nita taking on more responsibility.

5G Rollout

Reliance Jio Infocomm bought airwaves worth over $11 billion in India’s spectrum auction, as it sought to consolidate its lead over smaller rivals, Bharti Airtel Ltd and Vodafone Idea Ltd, in a rapid 5G network rollout. This will be important for increasing revenue and enticing high-value users.

India sells $19 billion airwaves with Reliance as top buyer

Investors will be looking for proof of pudding here. Despite several billions of dollars in investment, the technology has yet to return the benefits for Asian wireless operators, even those in China that have been offering 5G service since 2019. Details such as a nationwide rollout date, tariff plans for 5G services as well as where demand lies. The service will be crucial for Reliance Jio to appear.

Ambani’s children can showcase some of the key features of 5G services at the meeting, as they have showcased new telecom products in the past.

spinoff, ipo

Market watchers are waiting for more clarity about initial public offerings of Reliance Jio and Reliance Retail Ltd, especially after the two consumer-focused businesses raked in $27 billion in 2020 from marquee global investors.

Ambani sold Tech Dream for $27 billion. now she has to save

Both the companies are market leaders in their respective fields with a strong edge over the rivals. His listing – or even spinoff – could increase Ambani’s net worth. “The timeline is crucial for Reliance stock to bring back the mojo,” Bathini said. Reliance has gained nearly 11% this year, compared to a rise of over 40% by top performers on India’s S&P BSE Sensex.

new energy old energy

The $76 billion pivot towards green energy is the biggest change Ambani is currently making. It is a difficult transition given Reliance’s roots in petrochemicals and crude refining and the continued out-sized contribution of fossil fuel-led businesses to the group’s annual revenue.

Ambani said, green signal to beat Reliance’s other businesses

Investors will be looking for updates about last year’s announced plans to build four giga-factories to make solar modules, hydrogen electrolysers, fuel cells and storage batteries. Ambani has also failed to get small green energy firms globally for the expertise and technology. There are also plans to be among the world’s top blue hydrogen manufacturers.

going global

Ambani had emphasized his vision for “internationalization of Reliance” in his speech last year.

Over the past year, Reliance has turned to big overseas deals, such as a possible takeover of British drugstore chain Boots, which never materialised. Investors would like to see if the appetite for global acquisitions still exists amid a slowing economy across the globe.

Then there is always the possibility of a curve ball in the meeting, Bathini said. “Never underestimate the power of the senior Ambanis” to surprise the market, he said.

This story has been published without modification in text from a wire agency feed. Only the title has been changed.

first article