How Reliance Industries Built and Is Now Cutting Down Its House of Debt – By Vaishali Basu Sharma
As the country’s largest company by market capitalisation, it wouldn’t be far-fetched to state that Mukesh Ambani-owned Reliance Industries Limited (RIL) has become a cornerstone of the Indian economy.
Ambani’s seven-year investment spree from 2012 to 2019, largely fuelled by his telecom gamble, single-handedly boosted the rise in private investment. As Credit Suisse noted in October 2016, Reliance by itself contributed nearly 15% of the $117 billion in investment that was made by India’s top 1,250 publicly traded companies in 2015. This analysis included capex by the Indian Railways and state-owned electricity boards as well.
For decades now, RIL has held a commanding industry position, a situation that only changed once it started expanding into the telecom and retail businesses. Until 2012, RIL was debt-free on a net basis, but since then it has witnessed a 438% increase in its gross debt. As Reliance Industries ended FY’19 with net debt of Rs 1,54,478 crore, chairman Mukesh Ambani has been trying to assuage investor concerns over the group’s rising debt levels.…
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