Reliance AGM 2023: Addressing the 46th Annual General Meeting of Reliance Industries, chairman and MD, Mukesh Ambani underlined ‘Value Creation Roadmap’ of the company.
Mukesh Ambani said that in pursuit of the dreams, Reliance has scrupulously adhered to certain cardinal principles of value creation. These have ensured that the company becomes more valuable, year after year, decade after decade.
He said that RIL founder Dhirubhai Ambani always emphasised the power of dreams in achieving greater things. He used to say, “For those who dare to dream, there is a whole world to win.”
Value Creation Roadmap: 5 Commitments
1.Growth driven by perpetual demand: India is a supply-constrained market with the world’s largest population. Every item of consumption on per capita basis is still very low, compared to China, and substantially lower than developed markets like the EU and US.
“At Reliance, we have deliberately chosen to be in businesses that have large pent-up demand, which is guaranteed to grow at a healthy rate annually over many decades,” he said.
“This choice has led us to build businesses of global size and scale. Each of Reliance’s three growth engines ─ our O2C business, our Retail business and Jio’s Digital Services business ─ meets this value-creation criterion. And so also will our newest and fourth growth engine ─ Jio Financial Services.”
2.Growth driven by superior customer experience and value: Mukesh Ambani said that Reliance has always believed that our businesses can grow only by winning the trust of customers and creating value for them on a consistent basis.
“This has made us obsessed with offering them products and services of highest quality and value, which leads to continuous revenue growth.”
“Metaphorically speaking, I can say that market is a Temple for us and customers are the deities we must serve and please with utmost devotion.”
3.Growth driven by the power of disruptive technologies and innovation: Reliance has always had abiding faith in the power of best-in-class technologies and innovation to achieve ever higher levels of productivity and efficiency, while creating large-scale employment. This has helped Reliance achieve timely, efficient and below-cost execution of projects, which has become our hallmark.
“Our business operations are cost competitive because they are fully digital, agile and efficient. This unfailingly delivers larger market share, highest quality outputs and industry-leading margins,” he highlighted.
4.Growth driven by business discipline: He pointed out that Reliance has always practised the best norms of business discipline including financial and operational discipline.
“We have a laser-sharp focus on prudent capital allocation and financial management. This is evident from the fact that your company has enjoyed AAA rating for more than 33 years. We persistently improve operational discipline by developing right capabilities in our talent across the organisation.”
5.Growth driven by global market potential: He added that each of Reliance’s businesses has become a national champion in the domestic market.
“We are in a position to leverage our strengths and take our products, services and technologies and project execution capabilities to global markets without substantial new investments.”
These five commitments will translate into a new and virtuous multi-decade Value Creation Cycle defined by faster growth, higher revenues, better margins and increased EBITDA. This will significantly enhance the earnings multiples of each of Reliance’s businesses, he emphasised.
He also elaborated on the timeline of Reliance and the power power of dreams.
- In the ’70s, Reliance’s dream was to make the colourful, long-lasting and aspirational polyester textiles available to all Indians.
- In the ’80s, Reliance dreamt of a largely self-sufficient India in the wonder materials of that era – polyester, polymers and petrochemicals.
- In the ’90s, Reliance dreamt of eliminating India’s dependency on imported fuels refined abroad.
- In the first decade of the 21st Century, Reliance was focused on enhancing India’s energy security by exploring hydrocarbons in the depths of oceans.
- In the last 15-odd years, Reliance has pursued two big dreams – to create an omni-channel retail network, as well as to bring the power of digital technology to every Indian ─ aimed at benefiting hundreds of millions of consumers.
Each dream became a reality. Each dream was bigger than the last one. Each dream made Reliance reinvent itself, he said.
In pursuit of these dreams, Reliance has scrupulously adhered to certain cardinal principles of value creation. These have ensured that your company becomes more valuable, year after year, decade after decade.
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