About 20 global funds and major investment firms are making a beeline to invest billions of dollars into Reliance Retail as it is widely viewed by international investors as a de facto play on India’s torrid future consumption story
New Delhi: More than a dozen global funds—from Middle East sovereign funds and Canadian pension plans to Japanese conglomerates—are making a beeline to invest billions of dollars into Reliance Retail as the country’s largest retailer is widely viewed by the international investors as a de-facto play on India’s torrid future consumption story.
According to sources Abu Dhabi Investment Authority (ADIA), Saudi Arabia’s sovereign Public Investment Fund (PIF), Emirati fund Mubadala Investment Co. and Singapore’s GIC are looking at increasing their respective stakes in Reliance Retail Ventures Ltd. (RRVL), the holding company of the country’s largest retailer by number of stores and by sales. ADIA, PIF, Mubadala, GIC did not respond to IndiaRetailing’s emails seeking comment.
“All the existing Middle East funds are interested in increasing their stakes,” said a person familiar with the development. He said even though about 20 global funds and major investment firms are vying for a piece of Reliance Retail, chances are most of them would be disappointed as the stake sale this time around is limited.
Another person familiar with the matter said Reliance Retail could raise about $3-4 billion by shedding around 3-4% stake in RRVL in the fresh round as the company looks to retire its debt and make the country’s largest retailer virtually debt-free before a possible initial public offering.
“This fund round will be closed before September 30,” he said asking not to be named.
A Reliance Retail spokesperson said the company does not comment “on media speculation and rumours”.
Then there are new suitors including Kuwait Investment Authority (KIA), Japanese conglomerate of Mitsui and Mitsubishi, British Columbia Investment Management (BCI), AMCO, PSP Investment, Wellington Global and Softbank among others, the sources said.
BCI, PSP and Softbank declined to comment while Mitsui, Mitsubishi, Wellington and the Kuwaiti sovereign fund did not respond to IndiaRetailing’s emails.
Sources also said Ontario Teachers’ Pension Plan (OTPP) has also shown interest in purchasing a stake but the Canadian pension fund said the information is “not true.”
Global funds are queuing up to invest in RRVL as the company—which operates more than 18,000 brick-and-mortar stores and multiple e-commerce ventures—has emerged as the top option for foreign investors to bet on India’s $900 billion annual retail market that is expected to swell to $1.3 trillion in the next few years.
This is the second mega fund-raising round in RRVL. In 2022, Mukesh Ambani-led Reliance Industries Ltd. (RIL) had sold 10.9% in RRVL to a string of global funds including Silver Lake Partners, KKR, TPG, GIC, General Atlantic among others for Rs 47,265 crore, valuing the company at that time at around $62 billion. Now, the valuation of RRVL has gone up to $100 billion, as per the latest round of fund infusion that has happened in the last two months.
Last month, Qatar’s sovereign fund Qatar Investment Authority (QIA) invested $1 billion into Reliance Retail, valuing India’s largest retailer at a whopping $100 billion.
Then on Monday, Reliance Retail announced KKR is hiking its stake from 1.17% to 1.42% in the company as US private equity fund infused an additional Rs 2,069 crore (around $250 million) at the same $100 billion of valuation of RRVL.
