Mukesh Ambani-led Reliance Retail is gearing to trim its workforce and eliminate redundancies. The objective is to make the organisation leaner, more agile, efficient and profitable. This is expected to attract more investors as the company prepares for its Initial Public Offering (IPO).
As per media reports, in addition to weak sales Reliance Retail has been experiencing slow expansion and its valuation has dipped to $50 billion. That means its valuation has reduced by 50 per cent (from about $125 billion) since it raised investments in 2023. This can be attributed to sudden and extensive diversification into multiple areas and regions from energy.
To rectify the situation, the Ambanis are resorting to cost-cutting measures as well as job cuts. In addition to reducing marketing budgets, the company has decided to hold back the opening of new stores. The merger of Reliance Brands into the wider retail business as well as reassessment of brand partnerships worldwide are also reported to be underway.
Since October of 2024, the company has made it mandatory to obtain approval directly from Mukesh Ambani’s office before hiring anyone with a salary of more than $22,890 annually.
Additional staff at the stores can be hired only after prior approval from the managing director of Reliance Retail.
Clearly the company is endeavouring to optimise resources, streamline processes, eliminate roles that are overlapping or least essential and improve its valuation during the IPO.
