Reliance Strategy

Mukesh Ambani, Chairman and Managing Director of Reliance Industries Limited (RIL), had much to be proud

of after announcing the quarterly financial results of RIL in July 2011. The company had beaten market expectations

and posted its best-ever quarter, riding the wave of resurgent refining margins. The newly commissioned

Jamnagar 2 complex that made RIL the world’s largest refiner (using a measure of both volume and complexity)

had started to pay rich dividends. In unveiling the results for the year earlier, Mukesh had declared his intent

to double the value of RIL from $80 billion to $160 billion by 2020, no mean feat for an Indian company that

until recently was largely unknown outside India. (Exhibits 1 and 2 provide a financial snapshot of RIL, and

Exhibit 3 offers comparisons with industry performance benchmarks.)

RIL accounted for close to 15% of India’s exports and 6% of overall market capitalization in the country.

It was the single most widely held company in the country with an extraordinary track record of doubling profit

every three years through most of its history. It was the world’s largest producer of polyester fiber and yarn. It

accounted for 25% of the world’s most complex refining capacity, and had become the largest global producer

of clean fuels in a single location.

In some ways, these were also the worst of times for the leaders of RIL. In July 2011, the Central Bureau

of Investigation (CBI) reported that RIL