Mukesh Ambani Bolsters Hold Over With Stake Hike ndtv.com, 19th Sep 2019

With Saudi oil major Aramco buying stake in Reliance Industries oil-to-chemical business and uncertainty over likely changes in the equity structure of the company, has increased his stake in Reliance Industries.

In the industry circle, it is seen as a fortification of the promoters' stake and hold over the company on the back of the recent dilution of equity.

Reliance Services and Holdings, Mr Ambani's firm, acquired 17.18 crore equity shares or 2.71 per cent stake on September 13.

In July, RIL approved the merger of Reliance Holding USA Inc (RHUSA) with Reliance Energy Generation and Distribution (REGDL) and merger of REGDL with itself. RHUSA is a wholly-owned subsidiary of REGDL and REGDL is a wholly-owned subsidiary of the company.

As per data on the exchanges, promoters of RIL held 47.29 per cent stake, foreign institutional investors (FIIs) 24.4 per cent, mutual funds 4.56 per cent, insurance companies 7.1 per cent and public the rest 16.65 per cent, as on June 30.

A move follows Mr Ambani's announcement at the 42nd annual general meeting (AGM) in August that Saudi Aramco would acquire 20 per cent stake in RIL's oil-to- chemical business for an enterprise value of $75 billion.

Following the rise in promoter's stake, RIL's market capitalisation at the end of Wednesday's trade was over Rs. 7.64 lakh crore.

In the past few years, RIL has expanded its spread over varying segments, including the telecom with Reliance and acquisition of the British toy brand Hamley's. RIL has also gained a formidable hold over the retail space in the country, with its brand.

The company on September 5 also rolled out its fiber-to-the-home (FTTH) service "JioFiber" across 1,600 cities in India where the users will have an integrated experience of broadband, on-demand entertainment, free HD voice calling, TV video calling and unlimited data, among others. The company has also announced its plans to enter the e-commerce market.

COMMENT With the company disrupting and making its mark over several segments, along with several goals set for years ahead, the latest hike in promoter shares shows with the company growing and spreading its business, Chairman Mukesh Ambani doesn't want to lose control over his business empire.