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Pandemic-Marred Quarter Shows How Reliance’s ‘New Commerce’ Can Pay Off


Large retail chains struggled in the quarter ended June as Indians stayed indoors amid the raging pandemic and stores remained shut. But for Reliance Retail Ltd., India’s largest retailer, the period shows how Mukesh Ambani’s marriage of content, carriage and commerce is paying off.

Indians faced the world’s most punishing restrictions after Prime Minister Narendra Modi announced a complete lockdown in March 24. Economy remained frozen for nearly two months, but for supply of essentials. Consumption of everything except staples collapsed.

The pandemic forced Reliance Retail, operator of supermarkets, India’s largest consumer electronics retail chain, fast-fashion outlets and a cash-and-carry unit, to shut nearly half of the stores. Footfalls, the company said in its earnings presentation, tumbled nearly 57%, and about 39% in June alone. Revenue contracted 17%.

Yet, it could have been much worse had it not been for connectivity, or the data recharges by Reliance Jio Infocomm Ltd.’s subscribers, and the grocery business. Both these verticals grew during the quarter when everything else contracted.

The two businesses are central to Ambani’s bid to offer everything consumers through a hybrid offline and online retail model. And these are part of his effort to build a digital behemoth that rivals the likes of Alibaba Group, Tencent Holdings and Amazon Inc.

Data recharges through Jio outlets, housed under the retail business, spiked as Indians consumed more content during the lockdown. Jio, Ambani’s first step in creating a digital conglomerate, has upended India’s telecom market by offering cheap data, causing the consumption of online content to explode in India.

And the grocery business, an essential service during the lockdown, grew as the company launched and quickly scaled up JioMart, an online platform that lets people order from Reliance Retail stores via WhatsApp.


Sandip Ginodia , CEO

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