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Qatar Investment Authority (QIA), the country’s sovereign wealth fund, is looking to buy a minority stake in Reliance Retail Ventures, Financial Times (FT) reported on Wednesday. It said that QIA is considering a $1 billion investment to buy a one per cent stake bringing the valuation of Mukesh Ambani’s retail unit to $100 billion.
This comes at a time when several Gulf wealth funds are looking to get a slice of India’s retail market pie.
In 2020, Saudi Arabia’s Investment Fund had invested $1.3 billion in Reliance Retail to buy a 2.04 per cent stake at a valuation of $462.4 billion. New York-based KKR and two Abu Dhabi sovereign investment funds also own stakes in the retail company.
QIA, last year, pledged to invest up to $1.5 billion in James Murdoch’s new media and education venture, Bodhi Tree. It has also invested in Rebel Foods and the food delivery platform Swiggy.
Reliance is now aiming to diversify its retail business which is run by Ambani’s daughter Isha Ambani.
In the quarter that ended on June 30, Reliance Retail reported an 18.8 per cent year-on-year (YoY) rise in net profit at Rs 2,448 crore.
Its profit before interest, depreciation, and tax (PBDIT) increased 25.6 per cent YoY to Rs 4,896 crore. The revenue from operations of the country’s largest retailer increased 20.5 per cent YoY in Q1 to Rs 62,159 crore.
Ambani said, “Retail business delivered robust growth, with fast-paced store additions and steady growth in footfalls. The contribution of Digital and New Commerce initiatives is scaling up, delivering value to consumers and providing synergistic benefits to merchant partners.”
Reliance Retail added 555 stores in the quarter and witnessed its highest-ever footfalls at 249 million across formats.
Its digital commerce and new commerce businesses continued to grow and their contribution to revenue stood at 18 per cent in the quarter. Reliance Retail also completed the Metro Cash and Carry acquisition.
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