Morgan Stanley values RIL’s retail enterprise at $29 billion

Wall Street powerhouse Morgan Stanley has pegged the net asset value of Reliance Retail at about $29 billion with increasing revenue contribution from the e-commerce venture JioMart over the next three years.

E-commerce is expected to account for 15% of core retail sales estimates by 2023, pegged at $19 billion, based on which the valuation has been calculated. The core retail sales here exclude connecting revenues (mobile recharges) and petro-retail, where it has sold a stake to British Petroleum. The development comes as Reliance Retail looks to bring in strategic and financial investors after the record $20-billion fund-raise by Mukesh Ambani for his telecom business.

The recent capital infusion of $1.2 billion by Walmart in Flipkart shows there is room for multiple expansion if JioMart’s execution of growth plans improve and investor scepticism reduces, the report noted. JioMart, according to a person aware of the matter, is also ramping up its kirana on-boarding in non-metro cities as part of the acceleration of the new commerce initiative.

“They have started it in several cities and towns like Solapur, Kurnool, Madurai and Jalandhar. There is a separate platform that’s gone live for kiranas to register to join JioMart, so they can express interest and Jio can follow it up,” this person said. JioMart, which is clocking about 2.5 lakh orders daily in 200 cities, has also enabled business-to-business orders for kiranas as now they can order through Reliance Wholesale.

Sandip Ginodia , CEO

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