Beware Flipkart, Amazon! India’s richest man set to launch ecommerce venture soon
New Delhi: The fierce competition in the Indian ecommerce sector which was limited to two big players – Flipkart and Amazon India – so far will now get much bigger as India’s richest person Mukesh Ambani, chairman of Reliance Industries, is preparing to launch its e-commerce venture. According to a report in the Business Standard, RIL is planning to launch the ecommerce venture ahead of Diwali, when etailers clock around 30% of their total annual sales.
Online shoppers are likely to get big discounts this Dewali as RIL’s entry into the ecommerce space would force incumbent players to offer better deals to customers.
Earlier this year, during the Vibrant Gujarat summit, Mukesh Ambani had said that his group companies Reliance Retail and Reliance Jio Infocom would jointly launch a new e-commerce platform in the country and Gujarat would be the first state to get it.
Even speaking during the 41st annual general meeting (AGM) last year, Ambani had said that by 2025, it aims to double the group’s revenue with the help of retail and telecom businesses’ increasing contribution. The RIL chairman had also hinted about the group’s plan on expansion of its retail business using Jio’s digital platform.
Worth mentioning here is that for the quarter ending on December 31, 2018, RIL’s retail and telecom business contributed nearly one fourth of the Rs 1.71 lakh crore consolidates revenue. In FY18, Reliance Retail had recorded revenues of Rs 69,198 crore, a 105 per cent growth compared to FY17. The oil-to-telecom conglomerate now aims to increase the revenue contribution of its consumer-facing business to 50%.
It may be noted that RIL shares have rallied over 40% in last one year, outperforming the broader Sensex and Nifty. Analysts say the growth of its consumer-facing businesses like retail and telecom has been the main driving factor behind the stock price rally.
According to an earlier report in Mint, RIL is expected to come up with an initial public offer (IPO) for its retail venture, to achieve its aim of 30% annual growth over the next 10 years. RIL’s entry into the ecommerce space using Jio’s digital platform would give further boost to Reliance Retail’s revenue, say analysts.