Reliance Retail will soon seek shareholders’ approval to double its borrowing limit to Rs 1 trillion from Rs 50,000 crore now for future growth and expansions. The company’s borrowings as on March 31, 2022, stood at Rs 40,756.44 crore and the increase in the borrowing limit will give it the headway to raise up to Rs 60,000 crore as debt.
According to Reliance Retail’s latest annual report, the company will seek shareholders’ approval in its upcoming annual general meeting on September 30 to raise the limit presently “for the purpose of the business of the company”.
Reliance Retail has accelerated its expansions by opening over 1,000 new stores and bringing the overall store count to 2,400 plus with over half of them being in tier-II towns. The company registered 2X increase in sales from smaller towns, which now contribute over 50% of total revenues.
With an eye on the larger share of the e-commerce pie, the company has been strengthening its JioMart, Ajio and Reliance Digital offerings, and also new platform dedicated to third-party sellers. The company recently strengthened its portfolio with integration of Amante, Clovia and Portico. The company also recently announced plans to make a big foray into the FMCG business.
Reliance Retail had invested Rs 30,000 crore in 2021-22 to expand its store presence, acquisitions and strategic partnerships.
According to the annual report, out of its total borrowings of Rs 40,756.44 crore, as on March 31, 2022, Rs 12,021 crore was long-term borrowings and `28,735.44 crore was short-term loans. Of the short term loans, Rs 28,733.7 crore is unsecured loans and advances from related parties. This is in the form of int corporate deposits from the holding company.
Reliance Retail’s standalone revenue from operations for 2021-22 grew 29% year-on-year at Rs 1,93,456 crore, while net profit was Rs 4,934 crore.
The business crossed a milestone of Rs 10,000-crore Ebitda (earnings before interest, tax, depreciation and amortisation) in a year for the first time in FY22 and posted an all-time high Ebitda of Rs 10,365 crore, a growth of 24%.