India's Reliance Industries Ltd is looking to buy fashion and child-focused retailers abroad and partner with global sports and beauty brands as part of its expansion into consumer markets, a top executive told Reuters. Under Asia's richest man, Mukesh Ambani, Reliance Industries is pivoting from an oil-led conglomerate into a more consumer-facing company, selling everything from handbags to broadband to try to tap into Indians' rising disposable incomes.
Reliance Brands already runs high-end stores in India with some 40 foreign partners, including British label Burberry, shoemaker Steve Madden and New York-based Iconix Brand Group Inc, through joint ventures and franchises. It also wrapped up its first international acquisition in May, buying Hamleys here the world's oldest toy retailer, for $88.5 million. And it is not planning to stop there.
"The Hamleys acquisition ... has already whetted our appetite," Reliance Brands CEO Darshan Mehta said in an interview in India's financial capital Mumbai. "Internationally, much of brick and mortar retail is in a lot of pain," he added at the Reliance Brands office plastered with photographs of models advertising its breadth of brands. "No wonder - what may have once been available for 100 is now available for 50."
Western companies "over built" their store estates and did not see the "e-commerce gorilla" coming, Mehta said. "Look around and you will always find many of them up for sale, whether it be in New York, London or Milan." Mehta declined to give details on talks. He said Reliance had no timeline and often took years to strike deals. "You can't hurry love," he said.
Reliance is already India's biggest brick-and-mortar retailer in terms of revenue and number of stores. And Ambani, whom Forbes says is the world's 13th richest man, is also scaling up his grocery and wholesale businesses. Reliance Brands' products are available at 788 locations spread across exclusive brand outlets, shopping malls and airports. The company is planning to open around 120 stores in India in the fiscal year to March 2020, Mehta said.
The company is also seeking to partner with brands in two segments where it so far does not have a presence: beauty and athletic lifestyle wear. Multi-brand sports, wellness and fitness are the categories of interest for the company, Mehta said, adding women's and men's beauty products were also the target areas. However, Reliance Brands - which Mehta said chiefly targets around 50 million affluent Indians - still remains a small part of the Reliance conglomerate, which made a net profit of $5.5 billion on $87 billion of revenue in the year ended March 2019. The group did not give separate figures for Reliance Brands.