India’s Reliance Retail Lands $250M KKR Investment

Vicki M. Young
·3 min read
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KKR made a $250 million investment in India’s Reliance Retail Ventures Limited, increasing its stake to 1.42 percent.

The company is now valued at $100 billion after recent investments, including The Qatar Investment Authority, Qatar’s sovereign wealth fund, investing $1 billion for a 0.99 percent stake last month.

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KKR previously invested more than $700 million in Reliance Retail Ventures Limited. It was part of a group of investors that took a 10.1 percent stake in the Indian retail giant, raising $5.7 billion for the firm and valuing it at $62 billion at the time. Other investors include General Atlantic, the Saudi Public Investment Fund and United Arab Emirate’s Mubadala Investment Co.

Indian billionaire Mukesh Ambani owns Reliance Retail Ventures Limited, which was founded in 2006 and is part of Reliance Industries. “Our nationwide network of retail outlets delivers a world-class shopping environment and unmatched customer experience powered by our state-of-the-art technology and seamless supply-chain infrastructure,” according to the company website.

The company’s activities span stores selling grocery and convenience products to electronics and fashion and accessories. Reliance Retail Ventures Limited serves 267 million customers through an integrated channel network of over 18,500 stores and digital commerce sites. It has also digitized more than 3 million small merchants, enabling them to use technology and an efficient supply chain infrastructure to serve their own customers.

“We are pleased to receive continued support from KKR as an investor in Reliance Retail Ventures Limited,” said Isha Mukesh Ambani, director at Reliance Retail Ventures Limited. She added that the latest investment “further reinforces their strong belief in RRVL’s vision and capabilities.”

KKR co-CEO Joe Bae said the company looks forward to continuing its support of Reliance Retail Ventures Limited’ mission to “build a more inclusive Indian retail economy,” adding that the private equity firm is impressed by the company’s vision, digitization efforts to empower retailers across India and by its “resilience and performance in spite of the pandemic and other disruptions.”

The company on Monday reported a net profit of $1.1 billion on $31.7 billion in sales for the year ended March 31, 2023.

Walmart-owned Flipkart and Amazon India are battling fiercely to grab market share on the company’s home turf. In 2020, Amazon tried to block the company’s $3.4 billion deal to acquire Future Group, which ended up falling apart.

Reliance Retail Ventures Limited recently partnered with Chinese fast-fashion firm Shein to help it re-establish a foothold in the Indian market. It has also struck arrangements with Gap, Marks & Spencer and Jimmy Choo.

Reuters reported the company wants to raise $2.5 billion total by the end of September, or $3.5 billion when including the Qatari funds. This could be a sign that an IPO might be in the works; the owner hinted as much back in 2019, when he said an offering could be possible within five years.

IPOs help investors to see a return on their investment. Shein’s name has come up in IPO chatter, most recently in June when it allegedly confidentially filed a registration statement with the U.S. Securities and Exchange Commission. The company has never confirmed the rumors. And Walmart Inc., which last month paid $1.4 billion to acquire the stake in Flipkart held by Tiger Global Management, has said the Indian firm could go public

Walmart is already the majority stakeholder, and its additional investment values Flipkart at $35 billion. Walmart made its first investment in August 2018, paying $16 billion for a 77 percent stake. The American discounter upped its stake in Flipkart in July 2020, having led a new $1.2 billion financing round that valued the company at $24.9 billion.

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