Succession plan watch at Reliance AGM

 At the shareholders’ meeting, Mukesh Ambani is expected to bestow additional responsibilities on daughter Isha and youngest son Anant

Mukesh Ambani: File Photo

TT Special Correspondent   |   Mumbai   |   29.08.22 : The 45th annual general meeting of Reliance Industries on Monday is likely to cover succession planning and the listing of three key businesses. The AGM — to be carried out on a virtual mode — will also offer investors an updates on green energy and the 5G rollout.

At the shareholders’ meeting, Mukesh D. Ambani, chairman, RIL, is expected to bestow additional responsibilities on daughter Isha in the retail business and youngest son Anant in green energy. The succession planning was set in motion in June, when Mukesh Ambani resigned and eldest son Akash was elevated to the post of executive chairman at Reliance Jio Infocomm (RJIL). All the three Ambani children were directors at various Reliance arms.

There is speculation Isha Ambani could be made the chief of Reliance Retail. Sources close to the group said that after taking over the reins at RJIL, Akash Ambani played a key role in the recent 5G auctions where Reliance bought spectrum worth Rs 88,078 crore. “Both Akash and Isha Ambani have played important roles not only in various acquisitions that were made by Reliance in the past nearly three years. They were actively involved in the mega-stake sale that happened in 2020 with Facebook and other global investors,” the source said.

“In their executive roles, they have also taken various other decisions, and therefore it will not be surprising if more responsibilities are given by Mukesh Ambani to them.’’ Last year, Anant Ambani was appointed as a director of two new solar firms. Anant is also involved in RIL’s oil & petrochemical business. Earlier, he was inducted as a director on RRVL and Jio Platforms Ltd (JPL), RIL’s digital services arm. However, he is expected to be given more responsibilities in clean energy.

In telecom, investors are eagerly waiting for details on the 5G rollout. They expect the RIL chairman to formally announce a date for the rollout of 5G services at the AGM, apart from news on the 5G version of JioPhone. There have been speculation that the phone could cost anywhere between Rs 10,000 and Rs 15,000. In its annual report, RIL had said that it was 5G ready: Jio has successfully carried out testing across sites and has completed 5G coverage planning for 1,000 Indian cities.

These cities could be the first where the services are likely to be rolled out. Jio had entered into a strategic partnership with Google for its cloud solutions to power the 5G experience of domestic enterprises and consumers. It has also tied up with University of Oulu in Finland — the leader of the world’s first major 6G research programme — to accelerate research and standardisation even in 6G. “Jio is aggressively eyeing the 5G launch. It has successfully carried out 5G testing across sites and completed 5G coverage planning across 1,000 Indian cities.

Jio’s 100 per cent home-grown 5G stack and a tie-up with Google will power the 5G experience,’’ analysts at JM Financial said in a recent note. The markets will also be watching out for any statement by Ambani on the potential listing of its telecom, retail and oil-to-chemical (O2C) business.

Sources said that Jio Platforms Ltd and RRVL could be the first off the list and any announcement in this regard could lead to a rally in the stock. The RIL chairman is expected to provide an update of its huge investments planned in the green energy business. Reliance has said that this segment could be the next growth engine and it has the potential of outperforming other businesses in the next 5-7 years. Last year, Reliance had announced an investment of Rs 75,000 crore over three years.

The RIL stock has risen around 9 per cent in this calendar year while the benchmark Sensex has dipped almost two per cent because of geo-political tensions and worries over inflation and rising interest rates. Brokerages such as ICICI Securities have an “add’’ recommendation on the stock with a target price of Rs 2,805. Observers feel that analysts may revise their forecasts based on the announcements by Ambani at the AGM.