Mukesh Ambani, Reliance Industries chairman and Asia's richest man, continues to expand his business in different sectors with new strategies. His Reliance Industries is India's most valuable company with a market cap of Rs 19.93 lakh crore. Moreover, Reliance Retail is India's largest retailer, which has now increased the trading area for non-food and general merchandise by almost 50 per cent in its grocery stores in a bid to improve margins.
The move is also likely to bolster the retailer's hyper-local aspirations through its e-commerce platform Jiomart, through which it is connecting its Smart and Smart Bazaar stores providing a wider variety to consumers, according to an industry insider.
As part of that, Reliance Retail is now going for space revision at its stores, allocating higher trading areas for non-food and general merchandise items, a segment which offers higher margins than other segments such as grocery and apparel.
READ | Meet Indian man who got richer by Rs 54282 crore in just 5 days, he is not Mukesh Ambani, Adani
The extended retail space would not only allow Reliance Retail to offer a complete range of products for a segment but also fill in the gaps in its offerings, the source said. In the latest June quarter, Reliance Retail's EBITDA margin from operations was 8.2 per cent, which was up 30 basis points on a Y-o-Y basis. For FY 2023-24, its EBITDA margin was 8.5 per cent, improving by 70 bps on Y-o-Y. An e-mail sent to Reliance Retail seeking comments on the development remained unanswered by the time of filing the story.
Besides, it will also help compete with the growing quick-commerce platforms through its "hyper-local model under Jiomart, where it is investing in enhancements to the technology platform, supply chain capabilities and distribution capabilities.
Reliance Retail, which aims to double its business in the next 3-4 years, is trying to improve its margins. It is enhancing its play in the premium space as it believes as disposable income increases in the country, demand for goods and services is expanding rapidly.
In the AGM, Reliance Retail announced plans to enter the "luxury jewellery segment" with a curated, design-led experience and is exploring the fashion jewellery and accessories segment. Reliance Retail's gross revenue was at Rs 3.06 lakh crore (USD 36.8 billion) for FY24. Its stores witnessed over a billion footfalls and reported more than 1.25 billion transactions across its channels.
(Except for the headline, this story has not been edited by DNA staff and is published from PTI)
