Succession starts at RIL: Ambani family third generation join company board

Oil to telecom conglomerate Reliance Industries (RIL) on Monday inducted the third generation of the Ambani family as directors on the company’s board, viewed as the start of a succession. Mukesh Ambani told shareholders he will continue to perform as chairman and managing director (CMD) for five more years and mentor the three newly-appointed directors of the board.

On Monday, RIL announced two key changes at its board of directors level in relation to the Ambani family. First, Mukesh Ambani’s three children – Isha, Akash, and Anant, were appointed as non-executive directors on the board. Further, Nita Ambani stepped down as director from the board and will continue as chairperson for Reliance Foundation, the corporate social responsibility (CSR) arm of the company.

Isha Ambani at present is a board member for RIL subsidiaries – Retail Venture and Reliance Jio. Akash Ambani has been on the board of Reliance Jio Infocomm as chairman since June 2022. Anant Ambani is a director on the boards of Jio Platforms, Reliance Retail Ventures, Reliance New Energy and Reliance New Solar Energy.

“This is truly an emotional moment for me because it reminds me of that day in 1977 when my father inducted me into the Board of Directors of Reliance. I was only 20 then,” reminisced the senior Ambani in his address to shareholders at the company’s annual general meeting (AGM) on Monday.

Mukesh Ambani also listed mentoring Isha, Akash, and Anant as one of his three key priorities as CMD for the company for the next five years. “So that they can provide collective leadership and dependably take Reliance to greater heights of growth and value in the decades ahead,” Ambani said.

Himanshu Rai, Director with India Institute of Management, Indore (IIMI), views the move as a positive signal to all stakeholders. “It will also prevent any dispute in the future,” he said. Close to two decades back, succession after the demise of Dhirubhai Ambani, founder chairman of RIL, led to a bitter battle between the two brothers – Anil Ambani and Mukesh Ambani. The succession battle later led to the creation of two separate conglomerates – Reliance Group (earlier Anil Dhirubhai Ambani Group) and Reliance Industries.

Rai added that the next five years will give ample time to the third Ambani generation, “To learn the ropes and the subtler nuances of the various businesses,” he said.

The market, however, did not react positively to the announcements made at the AGM. RIL’s share price at the exchange closed 1.1 per cent lower on Monday than it was at the previous day’s close. Ambani started his address at 2 p.m. and had ended his note around the closing of market hours. “Absence of any announcements regarding the initial public offerings (IPOs) of Reliance Retail and Telecom dragged the RIL stock down. But indications about the green energy business are positive. Volatility in the stock price on the AGM day is normal for RIL,” said K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

Of the shareholder queries raised, how RIL plans to cope with the changes in the energy business due to climate change and the timeline for a listing of the retail and consumer business topped the chart. In his concluding remarks, in reply to these queries, Ambani assured shareholders of RIL’s profitability amid the change in energy trends. The billionaire, however, did not divulge any further details on a listing for the consumer businesses.

Start of succession was the only major announcement from the chairman’s speech on Monday, with no significant development indicated for the company’s business segments. For the oil to chemicals (O2C) business segment, Ambani reiterated the focus to transform into an integrated chemicals and materials business.

Ambani set 2026 as the new timeline for the battery giga factory, which is part of the new energy business. Ambani said the company will reach industrialising sodium-ion cell production at megawatt level by 2025, and rapidly scale up to giga scale thereafter. The earlier timeline for the scale-up to a fully integrated 5 GWh annual cell-to-pack manufacturing facility was 2024.

The newly-listed financial services business, which is planning to enter the insurance market, Ambani said, will do so in partnership with global players. Ambani also announced that Reliance Jio will launch its new fixed wireless access broadband offering, Jio AirFiber, on Ganesh Chaturthi (September 13).