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Saturday, October 01 2022
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RIL announces plan to move into $100bn FMCG market

RIL announces plan to move into 100bn FMCG market
Photo Credit : IANS

New Delhi: Reliance Industries Limited has announced its plan to move into the $100 billion FMCG market in FY2023, providing high-quality products at affordable prices.

Morgan Stanley said in a report that RIL has private label brands across F&B, HPC and BPC segments that are currently sold via its own retail channels.

“We believe the company will have to invest in brand building and marketing to transform this business from private label to full-fledged FMCG operations. Growth in the FMCG category is a function of both volume and market share gains,” Morgan Stanley said.

Margin profiles for FMCG businesses are superior to that of grocery retailers with gross margins of 40-60 per cent and EBITDA margin of 15-25 per cent versus 15 per cent and 9 per cent, respectively, for DMart.

Over the last two years, the company has grown its merchant partner base to over two million partners and it is on course to partner with 10 million merchants across the country.

RIL’s retail business has a turnover of $27 billion in the total $787 billion retail market. As per the company, it had a base of more than 200 million registered customers, 520 million walk-ins and 4.5 billion visits on the digital platforms in FY2022.

RIL has a total store network of more than 15,000 across categories with an operational area of 42 million sq ft, spread across 7,000 cities, with two-thirds of the store network in Tier II and below towns.

Of the new stores launched in F2021-22, 75 per cent were in Tier II and below towns, and Reliance Retail operates over two-third of its network in these markets.

RIL’s digital commerce platforms continued its growth with nearly 0.6 million orders being delivered every day, Morgan Stanley said.

Isha Ambani has taken over the leadership role for the retail business, supported by a management team of senior leaders.

Read more:

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