MY KOLKATA EDUGRAPH
ADVERTISEMENT
Regular-article-logo Friday, 09 May 2025

Reliance takes fancy to online retail

Read more below

Our Special Correspondent Published 04.03.15, 12:00 AM

Mumbai, March 3: Reliance Industries - the $67-billion powerhouse - is looking to take the battle to Amazon, Flipkart and Snapdeal.

The corporate behemoth is moving a special resolution seeking shareholders' approval to change its articles of association that will permit it, among other things, to lay siege to the country's biggest e-commerce bastions.

The Mukesh Ambani-owned giant had entered the organised retail space in 2006. It is now the largest player with revenues of almost Rs 15,000 crore in the year ended March 2014 and over 10 million square feet of retail space.

Although this is an enabling resolution, it gives some indication of the new areas of operations that Reliance is looking.

These include the construction of stores or malls, start a cash and carry operation, and a direct to home and mail order services for all categories of products and services.

It also plans to offer a digital payment service, create a globally managed data networks, create platforms relating to social, commerce, messaging, communication, gaming and other online services, as well as buy and sell all types of mobile applications including gaming, web applications and websites for mobile phones.

Even as the resolution talks of a wide swathe of businesses that the oil refining giant plans to enter, the one that really catches the eye is the foray into the e-commerce business which many studies show has been growing at a compounded average growth rate of around 45 per cent - making it one of most lucrative growth areas today.

Only recently, the Mukesh Ambani-flagship had submitted an application to the Reserve Bank of India seeking to set up a payment bank in partnership with the State Bank of India.

Observers, however, said Reliance Retail - an RIL subsidiary - had already entered the e-commerce segment, albeit in a low profile manner, through its Reliance Fresh Direct website that permits individuals to buy grocery and other items.

This venture is now being piloted in limited territories (Mumbai, Navi Mumbai and Thane).

In its third-quarter results presentation, the company disclosed that the exercise has received an encouraging response. Analysts do not rule out the possibility of this being extended to other cities over a period of time.

Some of the products now being offered by Reliance Fresh Direct include fruits and vegetables, dairy and bakery, packaged foods, personal care and confectionary.

While e-tailers like Amazon India, Flipkart or Snapdeal now work on the marketplace model, analysts said Reliance Retail was likely to initially focus on the direct delivery model, though it could bring more products at a later stage.

For the period ended December, Reliance Retail had close to 2285 stores in the country across formats that include jewellery, brands, digital, fashion & lifestyle and value.

One of the new clauses to be added to the memorandum of association includes a plan to 'construct, establish, run, operate and manage stores, markets, malls, shopping outlets'.

Follow us on:
ADVERTISEMENT
ADVERTISEMENT