Reliance Is, Step By Step, Preparing To Take On Amazon And Flipkart

Dhir Acharya - Apr 09, 2019

Mukesh Ambani, with Reliance, has completed a series of acquisitions was well as stake purchases as part of his expansion to e-commerce.

After successfully taking on major telecom providers like Vodafone, Idea Cellular, and Airtel, Mukesh Ambani with his Reliance Jio now has his eyes on Amazon, the current e-commerce giant in India. The richest person in Asia has completed a series of acquisitions was well as stake purchases as part of his expansion to e-commerce.

Through these acquisitions, Ambani is reshaping his business, turning it from a petrochemical company to a tech giant. Reliance Group has obtained the leading position in the telecom field regarding data consumption. Now, Ambani is heading towards consumer offerings, where Amazon India and Walmart-backed Flipkart are competing to obtain a larger market share in terms of e-commerce.

Mukesh Ambani

Bloomberg reports that since July 2017, Reliance Group has been making acquisitions and mergers in several areas like manufacturing, media and telecom, retail, technology, and e-commerce. According to Morgan Stanley’s estimation, by 2028, the online shopping area will be valued at $200 billion while the number for 2018 was only $30 billion. Cisco approximates that by 2022, there will be 829 million smartphone users in India and more people are expected to use online products and services.

Ambani, in July, announced to shareholders that Reliance will involve unlisted businesses like Reliance Jio Infocomm Ltd and Reliance Retail in its e-commerce attempt. He added that this plan will also use AR, hologram, as well as VR to generate an immersive shopping experience for customers. He continued by saying that by the end of 2028, consumer business’ revenue contribution to the group will be equal to that of the energy business.

Plus, as per Ambani’s announcement, millions of mortar and brick stores currently dominating India’s retail market will appear on the e-commerce platform. With this, Reliance is likely to have a significant advantage over Flipkart and Amazon India. On Reliance e-commerce platform, small merchants can do whatever large e-commerce players and enterprises can.

The company is gradually carrying out its plan through the acquisitions. Last week, it acquired chatbot maker Haptik for $101 million. Another acquisition with Radisys Corp will expand its presence in IoT and 5G. It is noted by Bloomberg that acquisitions with Grab a Grub and Vakt Holdings, on the other hand, will aid Reliance in delivering food and building a blockchain technology for leveraging digital ecosystem.