Reliance Jio Infocomm Ltd, the digital arm of Reliance Industries, on Tuesday, announced that Mukesh Ambani would resign as the director of the company effective from June 27, 2022. The company’s board has approved the appointment of Akash M Ambani, non-executive director, as chairman of the board of directors of the company.
Isha Ambani, his daughter, is set to be named chairman of the conglomerate’s retail unit, people familiar with the matter said. Currently, she is the director of Reliance Retail Ventures Ltd.
Reliance Industries, a $ 300-billion business empire, is undergoing a leadership shift and Mukesh Ambani in 2021 said that his children were taking up more responsibilities. He added that he could see the same spark and potential of his father, Dhirubhai Ambani – Reliance’s founder – for contributing to the country’s growth.
Both Akash and Isha are 30 years old and have been a part of the teams that negotiated Meta Platforms Inc.’s investment in the group. They have introduced new products and demonstrated various technology applications such as virtual reality.
Isha is an alumnus of Yale University and a former McKinsey & Co. consultant. Akash has graduated from Brown University with a major in Economics. The twins have a younger brother, Ananth, who is 27 years old and is a member of the board of Jio Platforms.
Mukesh Ambani’s plans for his younger child are still unclear. However, market observers expect that he will likely preside over the legacy oil-to-chemicals business of the conglomerate. Reliance Industries has a presence in energy, materials, entertainment and digital services as well. A few of these businesses could be professionally managed and the family can continue to keep hold with the help of the shares that they hold.
Reliance Retail and Reliance Jio are subsidiaries of the oil-to-telecom conglomerate and Reliance Industries is its flagship firm. In spite of Mukesh Ambani’s resignation, the stock gained 1.91% by Wednesday’s closing bell, after opening on a negative note in early trades.
Reliance Jio is the largest telecom operator in the Indian market with over 406 million subscribers. The company is actively increasing its broadband business with acquisitions.
“Ambani just ensured the continuity of the business. For now, nothing will change for the conglomerate, but Mukesh Ambani will be around to guide the next generation,” said Sankaran Manikutty, a former professor who taught at IIM Ahmedabad.
Many foreign investment firms are bullish on Reliance Industries Limited. Bernstein raised the company’s target price by 17.66% to ₹ 3,360 apiece from ₹ 2,830 apiece. The shares are currently trading at ₹ 2,597.80 apiece. This indicates an upside of 29.34%. It added that the stage is all set for Jio to deliver strong results driven by tariff hikes.
Written By – Simran Bafna
