ColdFusion - How HUGE is Reliance? (They're Responsible For T-Series) | ColdFusion

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Starting point is 00:01:00 You are watching Cold Fusion TV. Hi, welcome to another Cold Fusion video. Big businesses have always played a part in the history of a country. Car brands like Volkswagen and Mercedes helped shape 20th century Germany. Ford and McDonald's were a big part of the American dream. And much later, Apple and Facebook now play a huge role in society. But none of these companies compared to the United States. the influence that one conglomerate has had on its home nation. Today, we're going to look at how

Starting point is 00:01:33 Reliance has overtaken India. They have a huge role in oil, mobile communication, media, textile, retail and more. In India, Reliance can be the clothes on your back, the oil in your car, the mobile network you use, the TV you watch, and the food you buy. In addition to all of this, the company has started a digital revolution in the country and are directly responsible for the rise of T-series, the rapidly growing Indian YouTube channel that's set to overtake PewDiePie for the number one spot. We'll also see when Reliance's founder, DiRubai Ambani died, his two sons took sibling rivalry to a whole new level. So this video has been requested for over three years, and I think it's about time we took a look at Reliance. The business all starts in the 1960s in the textile trade.

Starting point is 00:02:23 DeRubai Ambani moved to Yemen from India as a young man to look for work. After a few years pumping petrol for an oil company, who moved back to the business. Mumbai and hoped to use a few connections in Yemen to create an import-export business. The aim was to bring polyester into India and send spices to Yemen. However, his business partner, who was also his second cousin, had a very different approach. Umbadi was a natural risk-taker, unlike his cousin, so eventually the pair went their separate ways, and Umbadi founded Reliance Textile Industries in 1966. The business really took off with the creation of the Vimal brand.

Starting point is 00:02:58 With this, Reliance Textiles were no longer just a materials supplier. Having their own line of clothing made all the difference. At first, Umbardy got his clothing into the stores by producing it as cheap as possible. But once the Vimel brand was up and running, he began a franchise model of his own, and the Vimel stores began to spread. An advertising campaign in the late 1970s was the establishment of the only Vimel brand. This brand became synonymous with young fashion for both men and women for decades to come. Ambardy was ready to put the company on the public stock exchange with their initial public offering. However, he took an interesting and new route.

Starting point is 00:03:36 At the time, stocks and shares were far removed from the average person. Ambardi wanted to change this, so he got the public excited for the company's IPO and put up about 2.8 million shares. The public took notice and the IPO was extremely successful. In India, this is known as the start of the equity cult, where the general public became far more engaged in the stock market. Even today, Reliance has millions of shareholders. On the back of the IPO and the wildly success of the only Vimal clothing brand, Reliance continued to grow and then diversified. In 1986, Reliance Capital was established.

Starting point is 00:04:11 This subsidiary offers financial services such as loans, stockbroking and insurance. Reliance Capital is currently one of the largest financial companies in India. Continuing on, Reliance would merge with another textile business at the end of the 1980s and bought their way into the petrol chemical industry. This was a way to expand on the polymers that they were already producing. But soon, the company had their eyes set on the oil fields themselves. They quickly grew into India's largest petroleum company. At the end of the 1990s, they built a refinery in Jamnagar.

Starting point is 00:04:42 It is still the largest oil refinery in the world. It doesn't stop there, though. Reliance infrastructure has been providing power, construction and defence since 2002. Reliance defence, build ships, has produced. projects in offshore engineering, and although politically controversial, in 2018, partnered with the French government to produce 36 Rafael fighter planes for India. And then was Reliance Retail, which has 45 subsidiaries, including mobile phones, jewelry, electronics, apparel and groceries.

Starting point is 00:05:17 More on all of that later. But I think one of the strangest ventures of Reliance is Rely Cord. This is the storage of ambilical cord blood. I have to say, it's an amazingly diverse business so far. But drama was soon to follow. In 2002, Reliance's original founder, Durubai Ambardi, died, but the thing was, he never wrote a will before he passed away. So, his eldest son, Mukesh, was put in charge as chairman and managing director, while

Starting point is 00:05:44 his younger brother, Anil, became vice chairman. Just like Derubai when he was selling textiles in the early days with his cousin, the two heirs to the Reliance Company had very different approaches and disagreements about the direction of the company. The dispute spilled out into the public in late 2004, and in something almost never seen before in corporate history, their mother had to step in to settle the dispute. Her idea was to split the businesses the following year. To put it simply, the older brother Mukesh got the oil and gas business under the name Reliance

Starting point is 00:06:17 Industries and Anil took the telecommunications finance and infrastructure part under the name Reliance Group. It was highly unusual and more of a family arrangement than a traditional business deal. But the conflicts continued. After the split, Anil was expecting Mukesh to sell him gas at a lower rate to use for his power plants. But the deal was vetoed by the government and Anil suspected that his brother had talked them into it. At the same time, Anil was also failing in his telecommunications business. The fight became such a matter of public interest that the Indian Minister of Finance requested that they settle this dispute.

Starting point is 00:06:53 It was the case that the company was so huge that these arguments were harming the Indian finance market. What a situation. So how did it all work out? Has the family feud continued or has it settled down after 13 years? Well, today it's pretty clear that Mikesh has emerged as the victor. Anil was forced to sell Reliance Communications to his brother about a year ago to avoid insolvency. So the total score is this. Anil's Reliance Group market cap stands at $13.8 billion,

Starting point is 00:07:25 while Mikesh's Reliance Industries' total assets are valued at $130 billion. For comparison, Tata Group, another huge Indian conglomer which I've done a video on, is currently worth about $126 billion US. So let's leave the brothers to Squabble for now and look at how important Reliance is for India right now. They have the largest market cap in India, as well as the largest private contributor to GDP. They also have the world's largest data network and are still the biggest polyester producer globally, so I guess some of their original businesses are still going. So as mentioned earlier, Reliance Retailants Retail has 45.

Starting point is 00:08:02 five divisions, some including Reliance Fresh, which has fresh produce like fruits and vegetables, and also online groceries, and Reliance Smart, which has apparel, footwear, as well as food. Reliance Digital is a consumer electronics branch that has over 650 retail stores. Reliance, LIF, which I think is shortened for life, is a 4G mobile phone manufacturer, established in 2015. Reliance Retail also does travel services, energy, entertainment and leisure, health and well-being products as well as educational products and services. They have a total of over 3,800 stores, which combined cover an area of over 17.7 million square feet across 750 cities. Reliance Retail

Starting point is 00:08:43 brings in an annual revenue of over $10 billion US dollars. Geo is a mobile network subsidiary of Reliance. Just one month after their official launch on the 5th of September 2016, they had already acquired 16 million subscribers. This is the fastest adoption of any mobile network operator anywhere in the world. It took them 83 days to get 50 million subscribers, and by February 2017, they had over 100 million people subscribed to their network. So, what did all of these new people coming online decide to do? Watch T-Series on YouTube, of course. T-Series is kind of like an Indian Vivo, with music videos featuring Bollywood stars, essentially. As alluded to at the beginning of this video, Reliance Geo caused massive growth in that channel,

Starting point is 00:09:31 disrupting the traditional YouTube order and is set to dethrone PewDiePie for the number one spot. The geo strategy was essentially this. Give away the data for free for three months and then charge over 30 times cheaper than the competition. This absolute price-slashing technique quickly brought 4G into every Indian home and single-handedly changed the data consumption habits of an entire country. Combined with cheap reliance mobile phones, now even those in rural areas or those of modest means like farmers, students and entrepreneurs, can finally have the tools they need to participate in the modern economy. Some analysts suspect that Reliance Geo alone could boost the Indian economy by over 5%.

Starting point is 00:10:12 In 2018, Reliance Geo is ranked as the number one firm to change the world by Fortune magazine. Reliance also owns the largest TV network in India, Network 18, which includes an Indian version of CNBC. Some commentators speculate that this is to control the news and public opinion about the company within the country. The company also offers 500 free-to-air channels under its Reliance Big TV subsidiary. Okay, so almost at the end of the video, but before we end, let's check out three facts about Reliance.

Starting point is 00:10:48 Number three, Reliance Industries has Asia's largest mango orchard. Its aim is to control the pollution caused by the Reliance Refinery. There's over 100,000 mangoes covering 600 acres of land with 127 varieties of mangoes. Number two, the Reliance Foundation. The Reliance Foundation was set up in the year 2000 and supplies funds for education, healthcare and has the goal of ending poverty. Number one. In contrast to the last fact, Mukesh Ambadi, the winner of the feud between the two brothers and the one that owns Reliance Industries, is now worth $44 billion.

Starting point is 00:11:24 He owns a 27-story house to accommodate his family of five. There's a staff of 600 workers who maintain it 24-7. It is the world's most expensive private residents valued at over $1.3 billion. It has 10 elevators, parking space for 168 cars, three helipads and an artificial snowroom, and of course countless other features. So that is the story of Reliance, including Reliance Group and Reliance Industries and all of the widespread subsidiaries. It is amazing to think that Reliance was started just by one man who worked at a petrol station in Yemen before selling textiles beginning on a bicycle in India.

Starting point is 00:12:06 Another fun fact, when it all began, he only had 300 US dollars to start with. Now they're one of the most widespread companies in existence. I guess it just goes to show that you really can't predict where life will take you. You can start with nothing and literally build an empire. If you're watching this video from India and you want to see the story behind an equally big company, you can check out my video on Tata.

Starting point is 00:12:29 Anyway, thanks for watching. This has been Degogo. You've been watching Cold Fusion. If you're new here and you've just stumbled across this channel, feel free to subscribe, and I'll see you again soon for the next video. Cheers, guys. Have a good one. Cold fusion.

Starting point is 00:12:45 It's new thinking.

ColdFusion - How HUGE is Reliance? (They're Responsible For T-Series) | ColdFusion

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