India’s Reliance To Raise $563M To Take On Amazon, Walmart

Reliance Industrial Investments is gearing up to raise ₹4,000 crore to meet the company’s investment requirements and needs for funding, reported Deal Street Asia.

The report, citing two people aware of the developments, said the funds will be raised via convertible preference shares across tranches at a dividend rate of 6 percent. RIIHL, the vehicle to invest in various subsidiaries of RIL, gives loans and buys stakes in various ventures, noted the report. RIIHL raised ₹8,000 crore through 778 million optionally convertible preference shares through the second quarter of this fiscal year, noted the report. “The objective of the issue is general corporate purpose and to fund various investments proposed to be made by the company,” said the second person in the report. The report pointed to the third quarter when RIIHL bought an 88 percent stake in Kanoda Energy Systems, which is a renewable energy services company. It operates in solar advisory, product design and tech validation, noted the report. The investment arm of RIL also invested in New Emerging World of Journalism, which is a startup that curates video content for mobile and also creates its own original mobile content.

According to the report, during the past year, RIL and its business units have been buying stakes in a host of ventures such as Indian Film Combine, Eros International, Saavn, Embibe, KareXpert Technologies, and Radisys Corporation. The company’s acquisitive nature and debt — which hit ₹2.74 trillion at the end of the December —  concerns analysts, noted the report.

“We are going to demerge our tower and fibre business. It means that eventually, you are going to see a lot more of the reverse cash flow and strengthening of the balance sheet. The intensity of capital expenditure will also come down,” V. Srikanth, RIL’s joint chief financial officer, said earlier in January, noted the report.