Reliance bets big on consumer business

Reliance Industries is expected to soon make a significant equity investment in its unit Reliance Consumer Products (RCPL) with the Mukesh Ambani-owned flagship increasing the latter's authorised share capital manyfold.RCPL's authorised share capital has been expanded to ₹10,000 crore, showed latest filings by the fast-moving consumer goods (FMCG) company to the Registrar of Companies (RoC). This was executed through a mix of six billion equity shares of ₹10 each, and four billion preference shares of ₹10 each, as per the filings. The latest step follows a restructuring of the FMCG business, making it a direct subsidiary of the ultimate parent entity, RIL, with effect from December 1. RCPL was earlier a direct unit of RIL's retail business holding company, Reliance Retail Ventures (RRVL). 126083644 The restructuring entailed transferring the FMCG brands from Reliance Retail to parent RRVL on a slump-sale basis. The existing FMCG entity RCPL was amalgamated with RRVL and the consolidated "consumer brands business undertaking" was demerged from RRVL into the new RCPL.RCPL said, in the RoC filing, that the authorised share capital has been increased to accommodate the proposed allotment of new equity shares by the company to RRVL shareholders and for future funding requirements.Incidentally, RCPL now mirrors the equity structure of RRVL-83.56% owned by RIL and the rest by nine global marquee investors such as Silver Lake, KKR, and Mubadala. Notably, prior to the restructuring, the authorised share capital of RCPL was ₹100 crore, as per RoC filings, with all FMCG brand acquisitions and investments undertaken by RRVL.Reliance is on an extensive mode to grow the FMCG business and challenge established firms including Hindustan Unilever, Coca Cola, and ITC.Reliance did not respond to queries. "Reliance has executed a textbook value unlock by transforming a company with a ₹10,000 crore authorised capital as the new RCPL to house its demerged consumer brands separate from retail store operations," said Mohit Yadav, founder at business intelligence firm AltInfo. He said this isolates high-margin FMCG assets from working capital intensive retail, potentially enabling a standalone listing for the consumer vertical.As per RCPL's balance sheet, the company clocked ₹1,301 crore revenue from operations in FY25, with a net profit of ₹9 crore. However, RIL has declared that the FMCG business clocked sales of ₹11,450 crore during the fiscal, its second year of operation. Most of the revenue was recognised in the retail business books since it owned most of the brands including Campa at the time.RCPL has recently acquired a majority stake in food and staples company, Udhaiyams Agro Foods, besides reintroducing sauce and jam brand Sil. The company in its October earnings call said the FMCG business has grown twofold in the first half of FY26, clocking ₹5,400 crore in July-September sales. General trade contributes almost 75% of sales. Reliance is also setting up multiple factories and food parks for its FMCG business. It has recently signed a pact with the government to build several facilities with a total outlay of ₹40,000 crore. However, the company has not shared plans on how it plans to finance the venture.