Reliance Industries Ltd., which gets 60 per cent of its revenue from oil refining and petrochemicals, plans to spend 600 billion rupees on four “giga factories” to make solar modules, hydrogen, fuel cells and to build a battery grid to store electricity.
The move toward green by the Mumbai-based giant, which reported an annual revenue of $63 billion, offers a glimpse of the new order awaiting some of the world’s major fossil-fuel producers.
The $10 billion in green investment over three years compares with a Fitch Ratings’ estimate of $7.4 billion in annual average capital expenditure by the Reliance group through March 2025.
In a move to reassure investors, he also said Aramco Chairman Yasir Al-Rumayyan will join the board of Reliance.
The proposed green transformation aligns with the priorities of Prime Minister Narendra Modi’s government, which has been debating aggressive climate targets that would cut net greenhouse gas emissions to zero by mid-century, a decade before China.
“The world is entering a new energy era, which is going to be highly disruptive,” said Ambani, 64.
“Is this doable from a standing start in nine years? It’s a stretch, it’s not impossible,” said Tim Buckley, director of energy finance studies at the Institute for Energy Economics and Financial Analysis.
The announcement comes the year after India’s most valuable company raised more than $30 billion selling stakes in its technology and retail units, and through a sale of shares to existing investors.
The investment inflows, which Ambani called “vote of confidence” in his businesses, have helped Reliance’s stock rally more than 90 per cent since the beginning of April 2020.
agreed last month to buy SoftBank Group Corp.’s $3.5 billion renewable power business in India, in a bid to achieve its goal of having 25 gigawatts of renewable power capacity by 2025.
“Reliance’s strategy on energy, data and consumer will ensure the company continues to grow sustainably bucking all cyclical trends,” said Sunil Chandiramani, chief executive officer at Nyka Advisory Services.
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