Reliance Retail's cumulative debt up 73% in FY23
Reliance Retail Ltd (RRL) borrowed ₹32,303 crore from banks in fiscal 2022-23, a year marked by rapid expansion of its business that industry executives said was primarily funded through debt.
As much as ₹19,243 crore of the loans were non-current, long-term, borrowings, as per disclosures in RRL's latest annual report. As of March 2022, it had a mere ₹1.74 crore in bank loans on its books.
The retail business also raised ₹13,304 crore in long-term debt from holding company Reliance Retail Ventures Ltd (RRVL), taking its cumulative debt 73% higher from a year ago to ₹70,943 crore, as per the FY23 report.
RRVL is pumping money into RRL mainly through the debt route, an industry executive said.
Last fiscal year, the company opened more than 3,300 new outlets, taking its total store count to 18,040. The pace is likely to continue this year too with a bigger thrust on small cities and towns where penetration of modern retail is low, said the executive who did not want to be named.
«The increase in Reliance Retail's long-term debt has largely funded investments to expand operational capacity, enhance stores, and develop digital platforms like JioMart,» said Mohit Yadav, founder at business intelligence firm AltInfo.
«Much of the borrowing has been allocated across procuring new equipment, improving leased properties, and strengthening technology infrastructure,» he said.
