Layoffs Across The Board. Reliance Retail Slashes Jobs Aiming $125 B Valuation. Reliance-Disney Cuts Over 1100 Jobs.

Mukesh Ambani, Asia’s richest man, is on a determined path to elevate Reliance Retail’s valuation to a staggering $125 billion, leading to the Chairman of Reliance Industries initiating a strategic overhaul of his retail empire, focusing on aggressive cost-cutting and structural reforms.

Isha Ambani is at the helm of this transformation, overseeing job reductions, limiting physical store expansion, and reassessing global brand partnerships. The ambitious restructuring also includes merging Reliance Brands with Reliance Retail, all in an effort to streamline operations and enhance efficiency.

The Push for Valuation Growth 

The push for a reevaluation strategy stems from brokerages have pegged Reliance Retail’s valuation at around $50 billion which is just half of its previous fundraising valuation from two years ago. Mukesh Ambani is now taking corrective measures acknowledging that the company expanded too aggressively across various formats and geographies. Notably, any hiring above a certain pay scale now requires direct approval from the chairman’s office.

This strategic pivot comes as Reliance Retail faces mounting competition from Tata Group, Amazon, and quick-commerce players like Zepto and Blinkit. The company is banking on leaner operations to steer these uncertain times with a broader economic slowdown impacting consumption patterns.

Reliance Retail’s IPO Strategy

Reliance Retail is eyeing a massive $125 billion valuation through an IPO. However, the fresh issue is expected to involve only a 5% stake dilution, offering limited exit opportunities for early investors.

Key financiers, between 2020 and 2023, including Qatar Investment Authority and General Atlantic, poured $8.24 billion into the company, collectively acquiring an 11.9% stake.

Financial Performance and Operational Shifts

Reliance Retail continues to post strong numbers despite the overhaul. In the financial year 2023-24, the company recorded revenue of ₹2.73 lakh crore and a net profit of ₹11,100 crore.

The company boasts a massive customer base of 34 crore registered users with over 19,100 stores and a digital presence spanning four applications. In Q3 FY25 alone, footfalls in Reliance Retail stores touched nearly 30 crore, reflecting a 5% year-on-year growth.

A key shift in strategy is the increased focus on digital commerce, with online and new commerce channels contributing 18% of total revenue. The company is also aggressively merging Reliance Brands Ltd with its primary retail entity to streamline operations further.

The Silent Layoff Wave, Why No Media Uproar?

Surprisingly, Reliance’s massive job cuts have largely escaped media scrutiny. Unlike layoffs at global tech giants that dominate headlines, Reliance Retail’s workforce reduction of 42,000 jobs (11% of its total workforce) in FY24 has barely caused a ripple in mainstream discussions. The company’s employee count fell from 3.89 lakh in FY23 to 3.47 lakh in FY24, and new hiring declined by over 1.7 lakh—a significant contraction.

Reliance-Disney’s JioStar. More Layoffs on the Horizon

Notably, Reliance’s cost-cutting measures extend beyond retail. The recently formed JioStar, a joint venture between Reliance’s Viacom18 and Disney’s Star India, is also seeing a significant restructuring. Reports indicate that over 1,100 jobs will be slashed to eliminate role redundancies and optimize resources.

Despite the layoffs, JioStar remains an entertainment powerhouse, controlling an $8.5 billion media empire with a 500-million-strong user base. The newly launched JioHotstar platform has consolidated premium content from Disney, NBCUniversal, Warner Bros., and Paramount, alongside live sports broadcasting rights for major tournaments like the IPL, Champions Trophy, and the English Premier League. The JV is targeting an ad sales revenue of ₹5,000 crore from IPL 2025 alone.

While job cuts are inevitable in large-scale corporate overhauls, affected JioStar employees are reportedly receiving generous severance packages ranging from six to twelve months’ salary, based on tenure.

Stocks In Question

Meanwhile, in the middle of all the anticipated changes, Reliance Industries Ltd. has been struggling, with its stock underperforming benchmarks and investor sentiment hitting an extreme low.

A recent Jefferies report noted that “pessimism seems extreme” around the conglomerate, particularly as its retail arm faces mounting challenges ahead of its anticipated market debut.

Shares of Mukesh Ambani’s flagship company have tumbled nearly 25% from last year’s peak, wiping out over ₹5 lakh crore in market capitalization. In contrast, the Nifty 50 has fallen just 7.4% in the same period, largely due to foreign outflows. Jefferies attributes Reliance’s underperformance to a slowdown in its retail business and weaker earnings from its oil-to-chemicals division.

Notable, investor concerns are amplified by reports that Reliance Retail is cutting jobs and tightening costs, including scaling back expansion plans, in an effort to boost valuations ahead of its IPO. While, Ambit Capital has slashed its valuation of the retail unit to $50 billion, a far cry from the $125 billion target set by the group, it has added to the skepticism – the latest estimates suggest only a 5% equity dilution in the public listing.

Yet, Jefferies believes the worst may be over for the retail segment. The brokerage predicts a 15% growth recovery in fiscal 2026, driven by same-store sales growth and store expansions. Other potential catalysts include tariff hikes, Jio’s likely listing, and an uptick in oil-to-chemical profitability. Jefferies maintains a ‘buy’ rating on RIL with a target price of ₹1,660, signaling a potential 38% upside from current levels.

Interestingly, Bharti Airtel’s stock has surged since July, suggesting that Reliance’s troubles may not be linked to Jio. In fact, Jio could soon outperform peers in ARPU growth, as it has yet to fully reflect the impact of past tariff hikes in its earnings. Meanwhile, the softness in Reliance’s oil-to-chemical segment might reverse if refining margins improve.

The Last Bit 

Mukesh Ambani’s vision for Reliance Retail – streamline operations, enhance profitability, and command a blockbuster IPO valuation, whether these cost-cutting measures will be enough to reach the ambitious $125 billion goal remains to be seen.

However, with the company shifting toward digital commerce and consolidating its retail empire, it is evident that India’s retail behemoth is preparing for its next big leap which is leaner, meaner, and sharper than ever.