Reliance Retail IPO Strategy: How Reliance Retail is increasing valuation for its 2028 IPO

Synopsis:- The company is preparing for a 2028 IPO by cutting debt from ₹53,546 crore to ₹20,464 crore, adding 2,000 stores annually, and strengthening its quick-commerce network. With 19,821 outlets and 18% revenue growth, its strategy focuses on profitability, restructuring, and long-term valuation upgrades.

Reliance Industries is targeting a 2028 IPO for its retail arm and is strengthening fundamentals ahead of the listing. The company plans to add around 2,000 stores annually, improve profitability, and reduce debt. It is also accelerating its push into quick commerce by expanding dark stores across major cities to capture rising demand and boost market valuation.

Reduced Borrowings

Reliance Retail has begun reducing its debt as part of a balance-sheet cleanup ahead of its planned IPO. Non-current borrowings dropped sharply to  Rs 20,464 crore in FY25 from  Rs 53,546 crore a year earlier, signalling stronger financial discipline and improved readiness for listing.

A major part of this reduction came from lowering inter-corporate deposits from the parent company, which fell to  Rs 5,655 crore from  Rs 40,164 crore in FY24. The remaining debt consists of bank loans, reflecting a more streamlined and manageable borrowing structure.

An executive familiar with the plans said expansion will be calibrated to ensure store profitability and strengthen valuations ahead of listing. The immediate priority is the telecom business IPO scheduled for next year, followed by the retail IPO two years later.

Retail Footprint

The company has already completed most of its network correction by shutting unprofitable stores over the past two years. While closures will continue as part of routine operations, Reliance expects to add a net 2,000 stores annually, reflecting renewed confidence in sustainable retail growth.

Reliance Retail plans a more controlled expansion strategy after the rapid rollout of stores in FY22–FY23 and subsequent closures in FY24–FY25. Net additions dropped from 2,844 stores in FY23 to 796 in FY24 and 504 in FY25, reflecting a shift toward profitability-focused growth rather than aggressive expansion.

By the September quarter, the company expanded its footprint to 19,821 stores, adding 412 outlets in just three months. Retail performance remained strong, with gross revenue rising 18% to ₹90,018 crore and profit after tax increasing 17% to ₹3,439 crore, reflecting solid consumer demand and operational strength.

Dark Store Strategy

Reliance Retail plans to intensify its push into quick commerce as it already handles nearly one million daily transactions, with 90% delivered in under 30 minutes. To strengthen this capability, the company is converting Smart Point stores in major cities into dark stores, enabling faster fulfilment and improving competitiveness in the rapidly growing instant-delivery market.

As part of its IPO readiness strategy, the group has separated Reliance Retail’s FMCG division and made it a direct subsidiary of Reliance Industries from December. This restructuring is aimed at improving transparency, sharpening business focus, and unlocking greater value ahead of future listings.

Conclusion

Reliance Retail’s measured expansion, rapid push into quick commerce, and significant debt reduction reflect a disciplined shift toward profitability and stronger valuation ahead of its 2028 IPO. With improving financials, sharper business restructuring, and a focused growth strategy, the company is positioning itself for a more compelling and sustainable public-market debut.

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