After energy, materials, the next core business we want to build is with consumers: Mukesh Ambani
>> Sunday, June 5, 2011
Mukesh Ambani waded into the Birla Matushri Hall, as is his customary practice, a little before the clock showed eleven. A few lucky shareholders occupying the aisle seats managed to snatch a magical few seconds of interaction with the chairman and managing director of India’s largest private sector company in terms of sales revenue and market capitalisation. He was addressing the 37th annual general meeting of Reliance Industries, as his mother Kokilaben, his wife Nita, and their three children — Isha, Akash and Anant, watched the proceedings from the front row. Excerpts from the interaction he had with shareholders on Friday:
On shareholders being unhappy about lower dividend outgo and on buyback of shares to stem the relative underperformance of the RIL stock
The benefits to shareholders have been tremendous over the last 30 years. We’ve deliberated on a buyback and I want to assure you that your interest is paramount and we’ll consider your suggestions. You can rest assured that we’ll continue with value creation.
The benefits to shareholders have been tremendous over the last 30 years. We’ve deliberated on a buyback and I want to assure you that your interest is paramount and we’ll consider your suggestions. You can rest assured that we’ll continue with value creation.
On listing of subsidiaries
We have no immediate plans for listing any subsidiary.
We have no immediate plans for listing any subsidiary.
On the BP tie-up
Our BP partnership is transformational not only for Reliance but also for India for the amount of skills they bring in. I expect government approval in the next few weeks and after that both BP and RIL will take complex technical studies to make sure that they’ll bring back on a sustained, long-term basis, value for you. We will be successful in the long term so far as D6 is concerned.
Our BP partnership is transformational not only for Reliance but also for India for the amount of skills they bring in. I expect government approval in the next few weeks and after that both BP and RIL will take complex technical studies to make sure that they’ll bring back on a sustained, long-term basis, value for you. We will be successful in the long term so far as D6 is concerned.
On the contentious issue of gas pricing and why should the RIL shareholder subsidise profitable power companies
The landed cost of gas today is $14 to $16 dollar per mBtu. I understand the sentiments you expressed on gas pricing.
The landed cost of gas today is $14 to $16 dollar per mBtu. I understand the sentiments you expressed on gas pricing.
On new ventures including financial services and homeland security
Yes, we are looking at financial services and homeland security. These are businesses which we will pursue with global majors. Right now, we are not contemplating banking licence in our scheme of things. You need to understand that financial services business will take at least three to five years.
Yes, we are looking at financial services and homeland security. These are businesses which we will pursue with global majors. Right now, we are not contemplating banking licence in our scheme of things. You need to understand that financial services business will take at least three to five years.
On retail business and its financial turnaround
Retail is a long-gestation business. This (the retail business) will be one of our biggest value creators in this decade as far Reliance Industries is concerned.
Retail is a long-gestation business. This (the retail business) will be one of our biggest value creators in this decade as far Reliance Industries is concerned.
On broadband strategy and offering cheap product and service offerings..
At Reliance, we always believe to make affordable, high-quality products that tens of millions of people can use. We expect our broadband plans to fructify in the next three to five years as these are all long-term businesses. This (broadband business) does not happen overnight. I think our shareholders are mature enough to be patient investors and have a long-term outlook and be prepared to get rewards on a subsequent basis. I don’t think it would be fair to expect overnight rewards.
At Reliance, we always believe to make affordable, high-quality products that tens of millions of people can use. We expect our broadband plans to fructify in the next three to five years as these are all long-term businesses. This (broadband business) does not happen overnight. I think our shareholders are mature enough to be patient investors and have a long-term outlook and be prepared to get rewards on a subsequent basis. I don’t think it would be fair to expect overnight rewards.
On RIL’s financials
We will be a debt-free company. Will look at the debt markets to optimise our cost of capital. We will continue to work with partners both in the public sector and the private sector to look at opportunities as and when those opportunities present themselves.
We will be a debt-free company. Will look at the debt markets to optimise our cost of capital. We will continue to work with partners both in the public sector and the private sector to look at opportunities as and when those opportunities present themselves.
On innovations at RIL
It is clearly a critical area for us. With Dr R A Mashelkar’s leadership within Reliance we’ll focus on innovation on what the new energy technologies are available.
It is clearly a critical area for us. With Dr R A Mashelkar’s leadership within Reliance we’ll focus on innovation on what the new energy technologies are available.
On the myriad web of subsidiaries, associate companies and ownership pattern
We are very committed to simplify our corporate structure, the structure of our subsidiaries and also our holding structure. We will always try to simplify our subsidiaries structure and crossholdings and you’ll see this unfold in the coming years as we embark to make it as simple as we can.
We are very committed to simplify our corporate structure, the structure of our subsidiaries and also our holding structure. We will always try to simplify our subsidiaries structure and crossholdings and you’ll see this unfold in the coming years as we embark to make it as simple as we can.
On RIL’s shifting focus on core businesses etc.
As the young person asked me and what I want to assure all of you is that as we go forward … we don’t do everything. Our core business is energy and materials and the next core business we want to build is with consumers. We have all kinds of energy and energy-related materials. In fact, tens of millions of people … like my father always believed in the philosophy that we are the middle class, for the middle class and by the middle class and we have to transform the quality of life of people. And that’s what we have done. We have developed capabilities and competencies. We are now developing it both in our retail and broadband businesses, which will really enhance the quality of life. These are two things that we are focusing on.
As the young person asked me and what I want to assure all of you is that as we go forward … we don’t do everything. Our core business is energy and materials and the next core business we want to build is with consumers. We have all kinds of energy and energy-related materials. In fact, tens of millions of people … like my father always believed in the philosophy that we are the middle class, for the middle class and by the middle class and we have to transform the quality of life of people. And that’s what we have done. We have developed capabilities and competencies. We are now developing it both in our retail and broadband businesses, which will really enhance the quality of life. These are two things that we are focusing on.
On the suggestions made by shareholders.
I would like to thank all shareholders for giving their suggestions, appreciating our work and for criticising us, so that we can learn and improve. Over the years, I’ve personally attended 30-odd meetings along with my father. I can personally vouch that we have appreciate each and every suggestion that you’ve shared with us. That’s the respect that I have for you.
I would like to thank all shareholders for giving their suggestions, appreciating our work and for criticising us, so that we can learn and improve. Over the years, I’ve personally attended 30-odd meetings along with my father. I can personally vouch that we have appreciate each and every suggestion that you’ve shared with us. That’s the respect that I have for you.
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