In the midst of COVID pandemic, Reliance Industries Ltd raised ₹152,056 crore (US$21 billion) by selling 32.97% equity stake in Jio Platforms - the digital business arm of Reliance Industries. Tech giants like Facebook, Google and Intel are among the investors of Jio Platforms. In May 2020, the enterprise value of Jio Platforms was estimated to be ₹5.15 trillion (US$72 billion). The company was also reported to be more valuable than all other businesses of RIL put together. Jio earned this valuation in just 4 years of its launch compared to 5 decades old Reliance Industries.
One of the factors behind this growth, which also sets Jio apart from other telecom companies, is the idea of selling multiple digital services to the same customer. This strategy attracted investments from world’s tech giants offering them valuable access to Jio’s customer base to sell new services to Indian consumers. A few years ago I happened to visit Reliance Innovation Leadership Center to exchange some ideas with their strategists who have responsibility to identify and implement innovative solutions for Jio. Thirst for digital innovations for mainly a petroleum company like Reliance has paid off as expected.
This indeed is a testimony of the capability of technology to multiply the value of a business. With strategic partners like Facebook, Jio Platforms aims to bring digital transformation in India. Jio's grocery eCommerce (JioMart) is being tested in 200 cities in India and within a few weeks of launch it reached 250,000 orders a day as disclosed by RIL Chairman in the 43rd AGM on July 15, 2020. It is interesting to know that, based on orders per day, JioMart is ahead of the leaders in this category - Bigbasket (220,000 orders a day) and Amazon (150,000 orders a day). JioMart plans to connect "manufacturers – small grocery retailers – consumers". I am not sure if JioMart would be able to make Grocery eRetail (retailer to consumer part of it) profitable, however there definitely are potential inbuilt opportunities if grabbed wisely.
Reliance has been partnering with startups, by investing or acquiring, to grow Jio Platforms - a wise strategy to get best talent on board and to accelerate growth. As a result it became the first Indian company to cross ₹1,100,000 crore (US$150 billion) market cap. With its digital growth engines, Reliance Industries is on its way to reach ₹2,000,000 crore (US$266 billion) valuation in next 3 years.
From our experience of creating digital innovations in various domains, I can see that - companies in almost all sectors can achieve such growth if they give the Midas touch of technology to their businesses. We hope to be, in our capability, a part of this value creation.