MUMBAI. Reliance Industries, led by Asia’s wealthiest individual Mukesh Ambani, has announced what is poised to be India’s largest-ever share sale. The conglomerate, with interests spanning petrochemicals, telecommunications, and retail, expects to raise approximately $20 billion through a rights issue and preferential allotment. The move signals a strategic shift to deleverage the company’s balance sheet and fund expansion in its digital and green energy ventures.
The offering, which opens to existing shareholders on May 20, marks a significant moment for Indian capital markets. Analysts note that the size of the sale surpasses the previous record set by the state-owned Coal India in 2010. Reliance’s stock has rallied 15% in the past month on the back of the announcement, reflecting investor confidence in the company’s pivot towards technology and renewable energy.
British institutional investors are among those taking a close interest. The UK’s asset management firms, including Legal & General and Aberdeen Standard Investments, have indicated preliminary appetite. These investors are drawn to Reliance’s strong cash flows and its dominant position in India’s rapidly growing digital economy. “It is rare to see a company of this scale offering such a substantial discount to existing shareholders. The strategic rationale is sound,” said a London-based fund manager who declined to be named.
The sale comes at a time when global interest in Indian equities is high, driven by the country’s relatively resilient economic growth despite the pandemic. Reliance’s move could further bolster foreign portfolio inflows into India, which have already exceeded $10 billion this year.
Geopolitical considerations also play a role. The Ambani family’s close ties with the Indian government and their strategic partnerships with global tech giants such as Facebook and Google provide a layer of stability that appeals to long-term investors. The company’s recent foray into 5G and its acquisition of a stake in the British telecom group BT have strengthened its international profile.
Regulatory hurdles remain. The Securities and Exchange Board of India has recently tightened rules on rights issues, requiring longer timelines and more disclosure. Reliance has said it will comply fully. The company’s debt, which stood at $21 billion as of March, is expected to be reduced by a third following the sale.
The broader implications for India’s corporate landscape are significant. A successful offering could pave the way for other large conglomerates to tap equity markets for capital rather than relying on bank debt. It also underscores the deepening of India’s capital markets, which have seen a surge in retail participation during the pandemic.
The share sale is scheduled to close on June 3. Reliance has yet to comment on potential international listings, though speculation persists that the company may eventually seek a secondary listing in London or New York to broaden its investor base.
