REPORT

ON
A Study on Reliance Industries company
(RELIANCE)

Submitted by Shalini Mehta

MBA-Finance Technology

Batch 2021-2023
 DECLARATION
I am Shalini Mehta student of MIT-ADT University
(MITU21MBAF0036) here by declared that the Report on “
RELIANCE INDUSTRIES( Reliance)” submitted for the degree of
Master in Business Administrative to MIT College of
Management.
I also declare that this report is my original work by Using
secondary data and has not been previously submitted.
SHALINI MEHTA
PNR: MITU21MBAF0036
Place: Loni Kalbhor, pune
 ACKNOWLEDGEMENT
I would like to express my deepest appreciation to all
those who provided me the possibility to complete this
report. I have taken efforts in this project. However, it
would not have been possible without the kind support
and help of many individuals and the College. A special
Thanks I give to our Class Teacher DR. Ujjwal Mishra my
college mentor whose contribution helped me to do my
Report Writing and Dr. Ujjwal Mishra invested full
effort in guiding the me in achieving the goal.
 TABLE OF CONTENT

Introduction
Statement
 Vision
 Mission
 Conceptual background
 Industry or Market Analysis (based on
secondary data and information)
 Bussines, Environment Analysis:
Swot,
PESTLE or
Michael porter’s five forces Model
 Finding/ suggestions/ conclusions
 Key Takeways
 INTRODUCTION OF RELIANCE
INDUSTRIES:
India's largest private sector company, Reliance Industries has evolved from
being a textiles and polyester company to an integrated player across energy
petrochemicals, textiles, natural resources, retails and
telecommunications and operates world-class manufacturing facilities
across the country. Reliance's products and services portfolio touches almost
all needs of people on a daily basis, across economic and social spectrums.
Reliance Industries Limited is headquartered in Mumbai and is growing
under the leadership of Mukesh Ambani, the son of late Dhirubhai Ambani
and elder brother of Anil Ambani after the division of the family business
among the two brothers.
Reliance Group is a conglomerate holding company in India that has a wide
portfolio of business and is the highest taxpayer in the Indian Private Sector. It
accounts for over 5% of the Indian Government's revenues and almost 8% of
the total merchandise exports from India. RIL was the first Indian company to
breach $100 billion market capitalization in 2007 and 2019 it has become the
first Indian firm to cross Rs 9 lakh crore market valuation marks. The
company has ranked 106th on the Fortune Global 500 list of the world's
biggest corporations as of the world’s biggest corporations
Dhirajlal Hirachand Ambani (28 December 1932 – 6 July 2002), popularly
known as Dhirubhai Ambani, was an Indian business tycoon who
founded Reliance Industries. Ambani took Reliance public in 1977 and was
worth US$2.9 billion in 2002 upon his death. In 2016, he was honoured
posthumously with the Padma Vibhushan, India's second-highest civilian
honour for his contributions to trade and industry.

Dhirubhai Ambani was one of the sons of Hirachand Gordhanbhai Ambani, a

village school teacher belonging to the Modh vaniya (Baniya) community and
Jamnaben Ambani and was born in Chorwad, Malia Taluka, Junagadh
district, Gujarat on 28 December 1932.  He did his studies from Bahadur
Khanji school.

He left Aden in 1958 to try his hand at his own business in India in the textiles
market.
Founding of Reliance Industries
Ambani returned to India and started "Majin" in partnership with Champaklal
Damani, his second cousin, who lived with him in Yemen. Majin was to
import polyester yarn and export spices to Yemen.
The first office of the Reliance Commercial Corporation was set up at the
Narsinatha Street in Masjid Bunder. It was a 350 sq ft (33 m2) room with a
telephone, one table and three chairs. Initially, they had two assistants to help
them with their business.
During this period, Ambani and his family stayed in a two-bedroom apartment
at the Jai Hind Estate in Bhuleshwar, Mumbai. In 1965, Champaklal Damani
and Dhirubhai Ambani ended their partnership and Ambani started on his
own. It is believed that both had different temperaments and different takes
on how to conduct business.  While Damani was a cautious trader and did not
believe in building yarn inventories, Ambani was a known risk-taker and
believed in building inventories to increase profit. In 1966 he formed Reliance
Commercial Corporation which later became Reliance Industries on 8 May
1973.
STATEMENT
 Vision:
 To be our clients’ first call and preferred collaboration partner within
our advisory expertise areas
 To consistently eceed our clients’ expectations for professional and
value-adding advice
To attain global best practices and become a world-class utility. To create
world-class assets and infrastructure to provide the platform for faster,
consistent growth for India to become a major world economic power. To
achieve excellence in service, quality, reliability, safety and customer car.

 Mission:
.
 To provide the best and most value-adding advice within our advisory
expertise areas
 To be an independent sparring-partner and to provide excellent advice
for our clients within our advisory expertise areas
 Conceptual Background

Today, Reliance Group is touching the sky of success under the excellent
guidance of Mukesh D. Ambani. He has been the part of Reliance
Board since 1977. He has begun the backward integration journey of
Reliance – from textiles to polyester fibers and further into petrochemicals
and petroleum refining and going upstream into oil and gas exploration and
production. Mukesh Ambani has introduced numerous top -class
manufacturing facilities backed by modern technologies; these have
raised Reliance's petrochemicals manufacturing capacities. Mukesh is
armed with a graduation degree in Chemical Engineering from
the Institute of Chemical Technology and an MBA from Stanford
University in the US.
Traded as  BSE: 500325
 NSE: RELIANCE
 LSE: RIGD
 BSE SENSEX Constituent
 NSE NIFTY 50 Constituent

Industry Conglomerate

Founded 8 May 1973; 49 years ago

Founder Dhirubhai Ambani

Headquarters Mumbai, Maharashtra
,
India

Area served Worldwide

Key people Mukesh Ambani

(Chairman & Managing Director)

Products  Petroleum
 Natural gas
 Petrochemicals
 Solar Energy
 Retail
 Telecommunications
 Media
 Television
 Entertainment
 Music
 Financial Services
 Software

Revenue  ₹792,756 crore (US$99 billion) (2022)

Operating income  ₹98,446 crore (US$12 billion)  (2022)

Net income  ₹67,845 crore (US$8.5 billion) (2022)

Total assets  ₹1,770,665 crore (US$220 billion) (2022)

Total equity ₹772,720 crore (US$97 billion) (2022)

Owner  Mukesh Ambani (49.46%)
 Public (50.54%)

Number of 3,42,982 (2022)

employees

Subsidiaries  Jio Platforms

 Reliance Retail
 Reliance Petroleum
 Reliance New Energy Solar Ltd
 Jio Payments Bank
 Network18 Group
 Mumbai Indians
 MI Emirates
 MI Capetown
 Dhirubhai Ambani International School
 Alok Industries
 Hathway Cable & Datacom
 Reliance Foundation
Industry or Market Analysis
Financial Milestones

2013–
 RIL’s Revenues for FY 2012–13 were Rs. 371,119 crore ($ 68.4 billion),
Net Profit was Rs. 21,003 crore ($ 3.9 billion), Networth was Rs.
176,766 crore and Total Assets were Rs. 318,511 crore, unparalleled
in the Indian Private Sector.
 Exports for FY 2012–13 were Rs. 239,226 crore ($ 44.1 billion), 14% of
India’s total exports.
 RIL declared Dividend of 90%. Payout of Rs. 3,092 crore, one of the
highest in the Indian Private Sector.
 During the year, RIL signed $ 4.5 billion equivalent facilities, backed by
Export Credit Agencies, which included:
2012
•RIL’s Revenues for FY 2011–12 were Rs. 339,792 crore ($ 66.8 billion), Net
Profit was Rs. 20,040 crore ($ 3.9 billion), Networth was Rs. 166,096 crore
and Total Assets were Rs. 295,140 crore, unparalleled in the Indian Private
Sector.

•Exports for FY 2011–12 were Rs. 208,042 crore ($ 40.9 billion), 14% of
India’s total exports.

•RIL declared Dividend of 85%. Payout of Rs. 2,941 crore, one of the highest in
the Indian Private Sector.

•Reliance Holding USA Inc., a wholly–owned subsidiary of RIL raised $ 1.0

billion through the issuance of 5.4%, 10–year Guaranteed Senior Notes in
February 2012.
 
2011 – Revenue crossed Rs. 2,50,000 crore mark (Rs. 2,58,651 crore, US$ 58.0
billion), Net Profit crossed Rs. 20,000 crore mark (Rs. 20,286 crore, US$ 4.5
billion) and Total Assets crossed Rs. 2,80,000 crore mark (Rs. 2,84,719 crore,
US$ 63.8 billion), unparalleled in the Indian Private sector.
Exports crossed Rs. 1,40,000 crore mark (Rs. 1,46,667 crore, US$ 32.9 billion),
13.4% of India's total exports.
RIL declares Dividend of 80%. Payout of Rs 2,385 Crore, one of the highest in
the Indian Private Sector.
2010 – Revenue crossed Rs. 2,00,000 crore mark (Rs. 2,00,400 crore, US$ 44.6
billion), Net Profit crossed Rs. 16,000 crore mark (Rs. 16,236 crore, US$ 3.6
billion) and Total Assets crossed Rs. 2,50,000 crore mark (Rs. 2,51,006 crore,
US$ 55.9 billion), unparalleled in the Indian Private sector.
Exports crossed Rs. 1,00,000 crore mark (Rs. 1,10,176 crore, US$ 24.5 billion),
14.5% of India's total exports.
RIL declares Dividend of 70%. Payout of Rs 2,084 Crore, one of the highest in
the Indian Private Sector.
2009 –  Total Assets crossed Rs. 2,00,000 crore mark (Rs. 2,45,706 crore, US$
48.44 billion), Networth crossed Rs. 1,00,000 crore mark (Rs. 1,26,373 crore,
US$ 24.92 billion), unparalleled in the Indian Private sector.
RIL declares Dividend of 130%. Payout of Rs 1,897 Crore, one of the highest in
the Indian Private Sector.
2008 – Revenue crossed Rs. 130,000 crore mark (Rs. 139,269 crore, US$ 34.7
billion), Net Profit crossed Rs. 15,000 crore mark (Rs. 19,458 crore, US$ 4.9
billion) and Total Assets crossed Rs. 140,000 crore mark (Rs. 149,839crore,
US$ 37.3 billion), unparalleled in the Indian Private sector.
Exports crossed Rs. 80,000 crore mark (Rs. 83,492 crore, US$ 20.8 billion),
13.4% of India's total exports.
RIL declares Dividend of 130%. Payout of Rs 1,631 Crore, highest in the Indian
Private Sector.  
2007 – Revenue crossed Rs. 100,000 crore mark (Rs. 118,354 crore, US$ 27
billion), Net Profit crossed Rs. 10,000 crore mark (Rs. 11,943 crore, US$ 2.75
billion) and Total Assets crossed Rs. 100,000 crore mark (Rs. 117,353 crore,
US$ 27 billion), unparalleled in the Indian Private sector.
Exports crossed Rs. 60,000 crore mark (Rs. 66,627 crore, US$ 15 billion), 12%
of India's total exports.
RIL declares Dividend of 110%. Payout of Rs 1,440 Crore, highest in the Indian
Private Sector.
2006 – RIL places $300 million in US Private Placement Market. First ever
Indian company to raise money through this route.
RIL declares Dividend of 100%. Payout of Rs 1,393 Crore, Highest In Private
Sector.
RPL a subsidary of RIL completes its US$ 1.2 billion Initial Public Offering of
equity shares with an overwhelming response across different classes of
investors. Chevron to Purchase 5% Stake in RPL for $300 Million. Option to
Increase Stake to 29%.   
2005 – Launches US $348 Million Syndicated Term Loan Facility. Aims To
Replace Existing High Cost Loans.
Reliance Successfully Closes US$ 350 Million Multi Currency Term Loan.  
2004 – Reliance signs EUR 116.2 million Export Credit Agency (ECA) backed
Buyer's Credit Facility provided by Deutsche Bank. RIL avails an ECA cover for
the first time in 22 years.
Reliance emerges as India's Greenest private sector company amongst the
private sector with an overall rank of number two in a BT – ACNielsen ORG–
MARG survey of shareholder perception published in Business Today's
October issue.
Reliance Industries concludes re–pricing of $687.50 million Syndicated Term
Loan facilities.
Reliance Group emerges as India's Largest Wealth Creator in the private
sector for the Year 2003–04.  
2003 – RIL – First Indian private sector company to record net profit of over
Rs 4,000 crore in one financial year.  
2002 – RIL – First Indian private sector company to record Net Profit of over
Rs. 1,000 crores in one quarter.
Reliance among ten most creditworthy companies in Asia.
Reliance Completes Acquisition of IPCL.  
2001 – RPL raises $750 million syndicated loan – deal named capital market
deal of the year by IFR Asia.
Group revenues cross Rs. 60,000 crore (Rs. 60,160 crores), Reliance becomes
largest business group in India.
RIL and RPL become India's two largest companies in terms of all major
financial parameters.  
2000 – Group profits cross Rs. 2,500 crore mark, Revenues cross Rs. 20,000
crore mark (Rs. 21,541 crores) and Total assets cross Rs. 50,000 crore (Rs.
52,094 crores).
1998 – Total Assets cross Rs. 35,000 crore (Rs. 35,445 crore) and Revenues
cross Rs. 14,000 crore (Rs. 14,115 crore).  
1997 – First corporate in Asia to issue 50 and 100 years bond in US debt
market.  
1996 – Reliance became the first private sector company to be rated by
international credit rating agencies. S&P rated BB+, stable outlook,
constrained by the Sovereign Ceiling. Moody's rated Baa3, Investment grade,
constrained by the Sovereign Ceilings.
Net profit crossed the Rs.1,000 crore mark (Rs 1,065 crores or US$ 338
million), unparalleled in the Indian Private sector.  
1994 – Offered the second Euro issue of GDR.  
1993 – India's largest public offering – Reliance Petroleum Issue.
Offered the first Euro Convertible bond issue  
1992 – Set a record with Reliance Twin issues that received over 1 million
investor applications.
Offered the first ever Euro Issue of Global Depository Receipts by an Indian
company  
1991 – Reliance commissioned phase–I of Hazira Petrochemicals Complex –
consolidated its position in polyesters and entered into attractive polymers
business – started VCM and PVC plants.  
1988 – Sales cross Rs. 1,000 crores mark (Sales for the year Rs. 1,778 crores).
1987 – Reliance commenced the Linear Alkyl Benzene (LAB) plant at
Patalganga.  
1986 – Reliance started PTA plant at Patalganga.
Reliance commissioned Polyester Staple Fibre (PSF) plant at Patalganga.  
1985 – Total Assets cross Rs. 1,000 crores.  
1977 – First IPO to the Indian Public. 

PARTICULARS MAR-2020 MAR-2021 MAR-2022

Equity and liabilities
Share capital 6339 6445 6765
Total Reserves 3,84876 468038 464762
Borrowings 194402 160598 167231
Other N/c liabilities 62600 38 313 39721
Current liabilities 3,30682 201787 200982
Total liabilities 978 899 875181 879461
Assets
Net Block 306478 306833 239626
Capital WIP 15 638 20765 19267
Intangible WIP 12327 12070 15395
Investments 421793 252620 330493
Loans & Advances 55978 71203 50568
Other N/c Assets 31 971 1714
Current Assets 166654 210719 222398
Total Assets 978899 875181 879461

Reliance Industries is one of India's biggest industrial conglomerates with

interests spread across petrochemicals, refining, oil and gas exploration and
production, retail and textiles. The company has a presence across 100
countries with a recent foray into fashion retailing for India. The company has
started exploring new applications in technical textile business for
commercial usage. The refining division operates the world's third largest
single location refinery which enjoys a unique geographical advantage. The
company has been facing some recent challenges from the Indian government
regarding the production capacity from the KG Basin wells.
This comprehensive analysis of Reliance Industries, includes an overview of
the industry the company operates in and then moves on to analyzing the
company itself.
Company analysis includes a history of Reliance Industries, a business
segment analysis of the segments Reliance Industries operates through, a look
at the organization structure of the company, a geographical operating
segments analysis, an analysis of the company's major competitors.
A financial analysis of Reliance Industries is presented in the report which
includes a ratio analysis, basic profit and loss analysis, presentation of the
company balance sheet, and much more.

A SWOT Framework Analysis of Reliance Industries completes this in-depth

company analysis.
Key Topics Covered
A. Executive Summary
B. Looking at the Industry
C. Looking at Reliance Industries
D. Looking at Business
E. SWOT Framework Analysis
F. Profiling the Competition
G. Financial Analysis of the Company
H. Future Perspective
I. Glossary of Terms
Companies Mentioned
- Reliance Industries
- Bharat Petroleum Corporation
- Indian Oil Corporation
- Oil & Natural Gas Corporation
Business Environment Analysis:
SWOT Analysis -
The SWOT Analysis of Reliance Industries includes its strengths, weaknesses,
opportunities, and threats. And in this reading of the SWOT analysis of Reliance
Industries, we will examine this beauty and wellness company in terms of its
internal and external factors.

S Stands For Strengths ( Internal Factor )

 Company With Low Debt: We already knew that in
2020, when the world was experiencing its darkest
moment ever, Reliance Industries, with huge funding
from top companies like Google, Facebook, Intel, and so
on, with a total investment of over Rs 1.8 lakh crore, lit
up the sunlight. which helped the company pay off its
debt.
 Strong Promoter: The whole world knows Tesla only
for his Superman promoter Elon Musk for his crazy
things. Likewise, Reliance Industries is known for
Mukesh Ambani his bold, risky moves, and love of the
country.
  Strong Brand: RIL is the first Indian private company to
be included in the Fortune 500 Global. Reliance
Industries is a fundamentally stronger company no matter
what sector it is in. For example, Jio has gained 400
million subscribers in just 5 years.
 Significant Market Share: Reliance Industries holds a
significant market share in all business segments. In the
telecom sector, Jio is the king, in retail Reliance Retail is
the king and the list goes on.
 Manufacturing Advantage: Reliance Industries owns
the world’s largest refinery in Jamnagar, spread over
more than 10,000 acres of land, and also has the
advantage of manufacturing other product categories on a
large scale.

W Stands For Weaknesses ( Internal Factor )

 Legal Actions: Reliance Industries is more vulnerable to
legal action because it runs an oil company that many
social activists are suing for environmental damage.
 Politically Vulnerable: When farmers across the country
launched a nationwide strike against the government for a
new 2020 farm bill, Reliance Industries was targeted by
activists.
 The decline in Productions: Reliance Industries’ main
gas production comes from two of its key assets, one
from the KG -D6 project and the other from Tapti Fields,
which is declining due to various natural and operational
issues. A decline in production affects the supply chain
and operating margins.
 Lack of Market Penetration: Currently Reliance
Industries is focused only on the Indian market, which
should be changed to achieve more growth should Jio
expand across the globe.
Also, Read SWOT Analysis of Amazon ( One of Largest Competitors Of
Reliance Industries in E-Commerce Sector )

O Stands For Opportunities ( External Factor )

  Acquisition: Reliance Industries can buy up startups or
companies that are close to their products. For instance,
Reliance Industries recently acquired Justdial to integrate
it with JioMart to increase its presence in the retail sector.
 Partnerships: RIL should partner with global oil
companies and technology companies to increase its
exposure to international markets.
 EV Industry: RIL can produce chemicals used in
batteries which is easy for them as they are already in the
petrochemical sector.
 Improving Jio: RIL should focus on bug fixes and
improvements to avoid common bugs that are reported
across the country.
 CBM as unconventional natural gas: CBM is a natural
gas extracted from coal seams. RIL has two CBM blocks
and is ready to exploit CBM as an unconventional natural
gas resource.
 New offerings in Reliance Jio: Reliance Jio has already
emerged as one of the largest telecom networks in the
country. Reliance Jio will have to come up with new
offers and retention strategies to retain the customers who
could also leave Jio for another offer from another
telecom giant.

T Stands For Threats ( External Factor ) 

 Regulations: As governments enact stricter regulations
and policies, this poses a major threat to their growth.
 Competition: Currently Airtel poses a big threat to
Reliance Jio in the telecom sector, Adani Group’s entry
into the petrochemicals business could affect Reliance
Industries’ petrochemicals business in the long run and
Tata Group is expanding aggressively like never before
 which can severely affect Reliance Industries’ growth as
Tata is a very reputed company in India.
 Climate Change: Climate change is now considered one
of the biggest disasters that mankind has ever faced.
Reliance Industries could be affected mainly through its
oil and petrochemicals business, where Reliance
Industries generates more than 50% of its total revenue
annually.

SWOT Analysis Of Reliance Industries Key

Takeaways
The SWOT analysis of Reliance Industries highlights where the brand currently
stands and its threats in this era. Following the detailed SWOT analysis of
Reliance Industries Here are Few Important Key Points.
1. Strong Promoter
2. Significant Market Share
3. Strong Brand Recall
Suggestions:
Following the detailed SWOT analysis of Reliance Industries, we have few
suggestions from Business Mavericks:
1. Reliance Industries needs to focus more on the
technology sector and ensure that it brings in a large
chunk of revenue.
2. Reliance Industries needs to take steps to transform itself
into a green energy company in a hurry or else it will lose
out.
3. Reliance Industries should stay away from unnecessary
political activities that affect the company without any
reason.

Reliance Industries STP & USP

  Segment: Companies, countries, and individuals looking
to meet their energy needs
 Target Group: Companies looking for energy for
manufacturing, people looking for gasoline diesel for
vehicles and home use
 Positioning: High-quality oil products from Reliance
Industries
Reliance Industries USP
Reliance Industries is one of the most profitable and leading companies in India

Reliance Industries Competitors

1. Bharat Petroleum Corporation Limited (BPCL) is a
government-owned Indian oil and gas company. It is
under the Ministry of Petroleum and Natural Gas,
Government of India, and is headquartered in Mumbai,
Maharashtra. The company operates two major refineries
in Kochi and Mumbai. India’s second-largest state-owned
oil company was ranked 309th on Fortune’s list of the
world’s largest companies for 2020 and 792nd on Forbes’
Global 2000 list for 2021.
2. Oil and Natural Gas Corporation (ONGC) is an Indian
state-owned oil and gas company. Its headquarters are
located in New Delhi. It comes under the Ministry of
Petroleum and Natural Gas, Government of India. It is the
largest oil and gas exploration and production company in
the country, producing about 70% of India’s crude oil and
about 84% of its natural gas. In November 2010, the
Government of India granted Maharatna status to ONGC.
3. Bharti Airtel Limited, also known as Airtel, is an Indian
multinational telecommunications service provider
headquartered in New Delhi, India. It operates in 18
countries in South Asia and Africa as well as the Channel
Islands. Airtel offers 2G, 4G LTE, 4G+ mobile services,
fixed broadband, and voice services depending on the
country. Airtel has also launched its VoLTE technology
in all Indian telecom circles. Airtel is the second-largest
mobile network operator in India and the second-largest
 mobile network operator in the world. Airtel was named
India’s second most valuable brand in the first Brandz
ranking by Millward Brown and WPP plc.
4. Adani Group is an Indian multinational conglomerate
headquartered in Ahmedabad. It was founded in 1988 by
Gautam Adani as a commodity trading company, with its
flagship Adani Enterprises Limited (formerly Adani
Exports Limited). The group’s various businesses include
port management, power generation, and transmission,
renewable energy, mining, airport operations, natural gas,
food processing, and infrastructure. The Group has annual
revenues of over $15 billion and operates in 70 locations
in 50 countries.In April 2021, Adani Group became the
third Indian conglomerate whose market capitalization
crossed the $100 billion mark.
PESTAL Analysis
PESTLE Analysis of Reliance Industries analyses the brand on its business
tactics. Reliance Industries PESTLE Analysis examines the various external
factors like political, economic, social, technological (PEST) which impacts its
business along with legal & environmental factors. The PESTLE Analysis
highlights the different extrinsic scenarios which impact the business of the
brand.
PESTLE analysis is a framework which is imperative for companies such as
Reliance Industries, as it helps to understand market dynamics & improve its
business continuously. PESTLE analysis is also referred to as PESTEL analysis.
Let us start the Reliance Industries PESTLE Analysis:
Political Factors:
The political factors in the Reliance Industries PESTLE Analysis can be
explained as follows:
Reliance Industries Limited is the biggest Indian conglomerate. Its business is
varied in multiple sectors including telecom, power, retail, cash and carry,
petroleum, fashion, mobile etc. Political stability is essential for flow of raw
materials and to maintain best in class supply chain efficiency. With political
instability the laws change more frequently. It becomes difficult for Reliance
Industries to adjust to such frequent law changes considering the massive size
of business. Also, the countries in which Reliance Industries has setup its
product base in the form of supermarket, product development etc. should not
be prone to military invasion. The government laws related to contract,
taxation, intellectual property protection is necessary to be in place. Some of
the laws that are launched to promote the telecom sector like the unified
access services scheme and 100% foreign direct investment in some of the
business fragments that Reliance Industries operates in helps to scale the
business profitably. Level of government intervention in free market and
capital goods is also a decisive political factor.
Economic Factors:
Below are the economic factors in the PESTLE Analysis of Reliance Industries:
There are multiple economic factors that impact business of Reliance
Industries Limited.
Inflation rate in the country decides as to buying capacity of the public in the
market. Too high inflation rate is not preferred for business to be profitable
because then the raw material procurement becomes costly resulting in rise
in the final product. High interest rates are bad for both business and the
customer. Business like Reliance Industries take up loan from various banks
to support their financials over the year and the customer to buy high end
quality products takes up loans. But when the interest rates shoot up both the
level of production and buying strength hampers. The stability in the
economic market and exchange rates is important factor to grow the business
at desired pace. GDP of the country reflects how the business is going to grow
in future.

Social Factors:
Following are the social factors impacting Reliance Industries PESTLE
Analysis:
This 21st century has seen tremendous increase in the spending power of
consumer. That has led to business like Reliance Industries to give a large
variety of product base with both extreme end of pricing. People these days
are society conscious and thus they are inclined towards fashionable brands
in apparel, technology fields. Internet these days has become a necessity.
Providing the most accessible, reliable and affordable internet was the
opportunity that Reliance Industries fetched via Jio product launch. The
economic class distribution in that respective area needs to be taken care of.
There is no point in promoting premium product to the public who do not
have the capability to pay for it. The public these days is more aware of the
hazardous effects of consumables on their health as well as on environment.

Technological Factors:
The technological factors in the PESTLE Analysis of Reliance Industries are
mentioned below:
Technology is ever changing. The involvement of technology is effective in
every business of Reliance Industries limited. Be it retail and the improved
ERP functioning, advance social media marketing or be it advancements in
telecom sector like 5G network and fibrenet broadband. The operations and
supply chain are getting disrupted with advanced technology.
The huge cash and carry stores of Reliance Industries have robots and
machine in place to move huge and heavy chunk of material.

Legal Factors:
Following are the legal factors in the Reliance Industries PESTLE Analysis:
There are strict laws that govern Reliance Industries’ business in every field.
Labor laws which protect basic rights of every labor including minimum
wages are to be aligned with the company’s legal framework. Environment
protection laws for the manufacturing units and their industrial waste
disposal standards govern their overall activity. Contract laws, corporate laws
and their adherence with company’s rules is mandatory. There is separate
legal team which looks after all kinds of laws which are to be aligned and
incorporated in their business. Health and safety laws are strict these data
since along with the government the public is also becoming conscious about
consumables content and quality.

Environmental Factors:
In the Reliance Industries PESTLE Analysis, the environmental elements
affecting its business are as below:
Reliance Industries Limited has diverse business. But each of those
businesses, be it petroleum, fashion retail outlet, agricultural products, foot
ware have to be monitored in terms of its environmental factors. The
emissions that are given out into the air has to be regulated under the norms
prescribed by the government. Excess of carbon emissions add to the ozone
layer depletion and resulting in global warming in the world. The plastic
waste generated cannot be dumped in the water bodies.
Michael Porter’s five forces Model
Reliance Industries Porter Five (5) Forces Analysis

Application of this model can help Reliance Industries to determine the

industry attractiveness and understand its competitive positioning in the
market. The analysis can also be used to make some strategically wise
decisions that could improve the performance of Reliance Industries and
ensure long-term survival.

Threats of new entrants

Threat of new entrants reflects how new market players impose threats to the
existing market players. If the industry will be profitable and barriers to enter
the industry will be low, it will attract more players and hence, the threat of
new entrants. will be high.

Here are some factors that reduce the threat of new entrants for Reliance
Industries:

 Entry in the industry requires substantial capital and resource

investment. This force also loses the strength if product differentiation
is high and customers place high importance to the unique experience.
 Reliance Industries will face the low threat of new entrants if existing
regulatory framework imposes certain challenges to the new firms
interested to enter in the market. In this case, new players will be
required to fulfil strict, time consuming regulatory requirements, which
may discourage some players from entering the market.
 The threat will be low if psychological switching cost for consumers is
high and existing brands have established a loyal customer base.
 New entrants will be discouraged if access to the distribution channels
is restricted.
Reliance Industries will be facing high new entrants threat if

 Existing regulations support the entry of new players.

 Consumers can easily switch the brands due to weak/no brand loyalty.
 Initial capital investment is high.
 Building a distribution network is easy for new players.
 Retaliation from the existing market players is not a discouraging factor.

How Reliance Industries can tackle the Threat of New Entrants?

 Reliance Industries can develop brand loyalty by working on customer

relationship management. It will raise psychological switching costs.
 It can develop long-term contractual relationships with distributors to
widen access to the target market.
 Reliance Industries can also an investment in research and development
activities, get valuable customer data and introduce innovative
products/services to set strong differentiation basis.

Threat of Substitute Products or services

The availability of substitute products or services makes the competitive

environment challenging for Reliance Industries and other existing players.
High substitute threat shows that customers can use alternative
products/services from other industries to meet their needs. Various factors
determine the intensity of this threat for Reliance Industries

The Threat of Substitute Products or services increases when;

 A cheaper substitute product/service is available from another industry

 The psychological switching costs of moving from industry to substitute
products are low.
 Substitute product offers the same or even superior quality and
performance as offered by Reliance Industries’s product.
However, this threat is substantially low for Reliance Industries when;

 The switching cost of using the substitute product is high (due to high
psychological costs or higher economic costs)
 Customers cannot derive the same utility (in terms of quality and
performance) from substitute product as they derive from the Reliance
Industries’s product.

How Reliance Industries can tackle the Threat of Substitute Products or

services?

 Reliance Industries can reduce the Threat of Substitute Products or

services by clearly emphasising how its offered product/service is
better than the available substitutes.
 It should provide convincing reasons to the customers by offering a
better experience and high value for money.
 It can raise switching costs by working on loyalty.
 Lastly, it can improve the quality, maximise value for money and set
strong differentiation basis to discourage customers from using the
substitute product.

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Rivalry among existing firms

The Rivalry among existing firms shows the number of competitors that give
tough competition to the Reliance Industries High rivalry shows Reliance
Industries can face strong pressure from the rival firms, which can limit each
other’s growth potential. Profitability in such industries is low as firms adopt
aggressive targeting and pricing strategies against each other.

The Rivalry among existing firms will be low for Reliance Industries if;
  There are only a limited number of players in the market
 The industry is growing at a fast rate
 There is a clear market leader
 The products are highly differentiated, and each market player targets
different sub-segments
 The economic/psychological switching costs for consumers are high.
 The exit barriers are low, which means firms can easily leave the
industry without incurring huge losses.

Similarly, there are some factors that increase the Rivalry among existing
firms for Reliance Industries For example, the company will face intense
Rivalry among existing firms if market players are strategically diverse and
target the same market. The rivalry will also be intense if customers are not
loyal with existing brands and it is easier to attract others’ customers due to
low switching costs. Competitors with equal size and offering undifferentiated
products with slow industry growth tend to adopt aggressive strategies
against each other. These all factors make the Rivalry among existing firms a
major strategic concern for Reliance Industries

How Reliance Industries can tackle the Rivalry among existing firms?

Reliance Industries should focus on the implicit needs and expectations of its
customers to strengthen the differentiation basis. It should raise switching
costs by developing long-term customer relationships. The organisation
should also invest in research and development activities to identify new
customer segments. In some cases, collaborating with competitors can be
mutually beneficial. The organisation can look for this option as well.

Bargaining Power of Suppliers

Bargaining power of suppliers in the Porter 5 force model reflects the

pressure exerted by suppliers on business organisations by adopting different
tactics like reducing the product availability, reducing the quality or
increasing the prices. When suppliers have strong bargaining power, it costs
the buyers- (business organisations). Moreover, high supplier bargaining
power can increase the competition in the industry and lower the profit and
growth potential for Reliance Industries Similarly, weak supplier power can
make the industry more attractive due to high profitability and growth
potential.

Bargaining power of suppliers will be high for Reliance Industries if:

 Suppliers have concentrated into a specific region, and their

concentration is higher than their buyers.
 This force is particularly strong when the cost to switch from one
supplier to other is high for buyers (for example, due to contractual
relationships).
 When suppliers are few and demand for their offered product is high, it
strengthens the suppliers’ position against Reliance Industries
 Suppliers’ forward integration weakens the Reliance Industries’s
position as they also become the competitors in that area.
 If Reliance Industries is not well educated, does not have adequate
market knowledge and lacks the price sensitivity, it automatically
strengthens the suppliers' position against the organisation.
 Other factors that increase the suppliers’ bargaining power include-high
product differentiation offered by suppliers, Reliance Industries making
only a small proportion of suppliers’ overall sales and unavailability of
the substitute products.

Contrarily, the bargaining power of suppliers will be low for Reliance

Industries if:

 Suppliers are not concentrated

 Switching costs are low
  Product lacks differentiation
 Substitute products are available
 Reliance Industries is highly price sensitive and has adequate market
knowledge
 There is no threat of forward integration by suppliers.

How Reliance Industries can tackle the Bargaining Power of Suppliers?

Reliance Industries can strengthen its position against suppliers by decreasing

the dependency on one or a few suppliers. It will increase its price sensitivity.
Developing the long-term contractual relationships with suppliers from
different regions not only lowers their bargaining power but also allows
Reliance Industries to improve its supply chain efficiency. Finally, Reliance
Industries can find the alternate ways of producing the product if product
demand is high enough and the firm has required competencies and expertise.
However, it requires detailed cost-benefit analysis to determine its feasibility.
Product redesign and diversification of the product lines can also help the
organisation reduce the suppliers’ power in the market.

Bargaining Power of Buyers

Bargaining power of buyers indicates the pressure that customers exert on

the business organisations to get high quality products at affordable prices
with excellent customer service. This force directly influences the Reliance
Industries’s ability to accomplish the business objectives. Strong bargaining
power lowers profitability and makes the industry more competitive.
Whereas, when buyer power is weak, it makes the industry less competitive
and increase the profitability and growth opportunities for Reliance
Industries

There are some factors that increase the bargaining power of buyers:
  A more concentrated customer base increases their bargaining power
against Reliance Industries
 Buyer power will also be high if there are few in number whereas a
number of sellers (business organisations) are too many.
 Low switching costs (economic and psychological) also increase the
buyers’ bargaining power.
 In case of corporate customers, their ability to do backward integration
strengthen their position in the market. Backward integration shows
the buyers' ability to produce the products themselves instead of
purchasing them from Reliance Industries
 Consumers’ price sensitivity, high market knowledge and purchasing
standardised products in large volumes also increase the buyers'
bargaining power.

Some factors that decrease the bargaining power of buyers include lower
customer concentration (means the customer base is geographically
dispersed), customers’ inability to integrate backwards, low price sensitivity,
lower market knowledge, high switching costs and purchasing customised
products in small volumes.

How Reliance Industries can tackle the Bargaining Power of Buyers?

Reliance Industries can manage the bargaining power of buyers by increasing

and diversifying their customer base. It can be done by introducing new
products, targeting new market segments and adopting the product
diversification strategies. Marketing and promotional strategies can also be
helpful in this regard. Building loyalty by embedding innovation and offering
excellent customer experience can raise the switching costs, which will
ultimately reduce their bargaining power. Reliance Industries can adopt these
strategies to strengthen its competitive positioning in the market.
Porter 5 force model implications

The application of Porter five (5) forces model in real-world context allows
organisations to .make wise strategic decisions. Impact and importance of
each of the five forces is context dependent. By using Five Force analysis,
Reliance Industries can determine the industry attractiveness, make effective
entry/exit decisions and assess the influence of these forces on their own
business and competitors. Moreover, the dynamic analysis of this model can
reveal important information. For example, Reliance Industries can combine
the Porter 5 force model with PESTEL framework to determine the industry’s
potential future attractiveness. In some cases, companies do not have the
required information to analyse five forces. In such a scenario, the analysis
can be conducted with the help of assumptions. Mostly, consultants consider
this model as a starting point, and other frameworks (like PESTEL and Value
Chain) are used in conjunction for a better understanding of the external
environment.

FINDINGS AND CONCLUSION

 Reliance is one of the most profitable companies in india , the largest
publicly traded company in india by market capitalization, and the
largest company in india as measured by revenue after recently
surpassing the government controlled Indian oil corporation. On 10 th
September 2020, Reliance Industries became the first Indian company
to cross $200 billion in market capitalization.
 But RIL has a great future ahead as they are expanding their business &
doing partnership with top companies like Amazon, Facebook, etc.
 Thus , investment in RIL is good decision in the nearby future.
 REFERENCE

https://businessmavericks.org/swot-analysis-of-reliance-industries/

https://ticker.finology.in/company/RELIANCE

https://www.theceo.in/leaders/an-overview-of-reliance-industries-limited

https://www.porteranalysis.com/porters-five-forces-of-reliance-industries/

https://en.wikipedia.org/wiki/Reliance_Industries

https://www.businesswire.com/news/home/20130227005711/en/
Research-and-Markets-Analysis-of-Reliance-Industries