Despite Dhirubhais Death, Reliance Forges Steadily Ahead

Updated: Dec 29 2002, 05:30am hrs
March: Two companies merge to create Indias largest private sector enterprise; this also makes it the first Indian company to find a place in the Fortune 500 club.

June: The company acquires one of its major competitors and public sector giant Indian Petrochemicals Corporation Ltd (IPCL).

September: It tightens its control over BSES Ltd by hiking its stake to 43.40 per cent.

October: It discovers Indias biggest ever natural gas reserves in the Bay of Bengal. The in-place volume of natural gas is in excess of seven trillion cubic feet, equivalent to about 1.2 billion barrels of crude oil.

December: It rolls out various telecom services beginning with Gujarat; its limited mobility telephone services hold the potential of changing the rules of the telecom sector.

The Reliance group could not have asked for a better year in terms of business growth. But these landmark developments, or for that matter any other event in India Inc. during 2002, were overshadowed by the death of Reliances charismatic founder, Dhirubhai Ambani, on July 6.

The outburst of public emotion on the passing away of Mr Ambani overwhelmed the family. Thousands of people lined up on Mumbais streets to pay homage to the man who built a Rs 65,000 crore ($13 billion) turnover empire from scratch in just a quarter of century.

After some speculation over his successor, Mr Ambanis elder son, Mukesh Ambani, was elevated as the chairman and managing director of Reliance Industries Ltd and his younger son, Anil Ambani, was promoted as the groups vice-chairman and managing director.

Mukesh Ambanis appointment as the group chairman was as smooth as any of the big ticket business deals his illustrious father struck during his lifetime, though the corporate sector has been abuzz for the past couple of years with rumours about differences between the two brothers.

In March 2002, when it announced its merger with Reliance Petroleum Ltd (RPL), Reliance Industries became the largest private sector company in the country according to all major financial parameters, including sales, profits, net worth, assets and exports.

Reliances discovery of gas in the Krishna Godavari basin, the biggest ever such find by a private sector company, opens enormous opportunities for the company since this find was made after covering just 2,000 square kilometres (sq km), which leaves a more than 1,75,000 sq km area open to further finds.

In November, Reliance, the worlds second largest polyester yarn and fibre producer, announced its plans to expand its polyester capacity by 40,000 tonnes per year. Once its new plant is commissioned, Reliance will command a total production capacity of nearly 8,50,000 tonnes per year of polyester filament and staple fibre.

Reliance General Insurance Ltd emerged as the most profitable private sector insurance company in India, during its first year of operation. On total revenues of Rs 65,000 crore, the groups cash profit stands at over Rs 7,500 crore ($1.5 billion), its net profit at over Rs 3,600 crore ($740 million), its exports at over Rs 11,400 crore ($2.3 billion) and its total assets at over Rs 69,000 crore ($14.1 billion).