SUMMARY
KKR will acquire an additional 0.25% stake in Reliance Retail with the investment, valuing the company at INR 8.36 Lakh Cr
In 2020, KKR invested INR 5,550 Cr in the retail and digital commerce subsidiary of Reliance at a pre-money equity valuation of INR 4.21 Lakh Cr
The capital infusion comes days after Qatar Investment Authority said it would invest INR 8,278 Cr in Reliance Retail
Reliance Industries Ltd (RIL) on Monday (September 11) said global investment major KKR will acquire a 0.25% stake in its retail and digital commerce business subsidiary, Reliance Retail Ventures Ltd (RRVL), for INR 2,069.5 Cr. This pegs the retail giant at a valuation of INR 8.36 Lakh Cr.
KKR will invest in RRVL through an affiliate to increase its total stake in the company to 1.42%, RIL said in a statement.
“… We highly value our deepening partnership with KKR, and their latest investment in RRVL after their previous investment further reinforces their strong belief in RRVL’s vision and capabilities. We look forward to continued engagement with KKR and to benefit from their global platform, industry knowledge and operational expertise, in our journey towards driving transformation of the Indian retail sector,” RRVL director Isha Ambani said.
The fund infusion will take KKR’s total investment in RRVL to INR 7,619.5 Cr. In 2020, it invested INR 5,550 Cr in the company to acquire 1.17% stake. At the time, the retail arm of RIL was pegged at pre-money equity value of INR 4.21 Lakh Cr.
Commenting on the fundraise, KKR co-chief executive officer (CEO) Joe Bae said, “Throughout our investment period in Reliance Retail, we have been impressed by the company’s vision and extensive work to empower retailers across India through digitalization, as well as by its resilience and performance in spite of the pandemic and other disruptions.”
RRVL has brands such as AJIO, JioMart, Netmeds, Milkbasket and Trends under its umbrella. The company also owns a minority stake in troubled quick commerce startup Dunzo. RRVL claims to have an omnichannel network of more than 18,500 stores and digital commerce platforms across multiple segments.
The capital infusion comes days after Qatar Investment Authority said it would invest INR 8,278 Cr in RRVL at a pre-money equity value of INR 8.3 Lakh Cr.
The development comes at a time when RRVL is expanding its offerings with new launches and onboarding more micro, small and medium enterprises (MSMEs).
Be it relaunching Shein in India or entering the beauty and personal care (BPC) space with Tira, RRVL has forayed into multiple segments. It has been mounting a major challenge in the ecommerce space, which has traditionally been a startup stronghold.
Last week, RRVL announced acquisition of a 51% stake in actor Alia Bhatt’s kids-wear and maternity-wear brand Ed-a-Mamma.
RRVL posted a net profit of INR 2,448 Cr in the first quarter of financial year 2023-24 and an operating revenue of INR 62,159 Cr. Digital and new commerce businesses accounted for 18% of its revenue during the quarter.
