Reliance's LP Strategy

Reliance Industries Ltd. is one of India’s largest private sector companies. Its FY25 numbers illustrate its scale:

• a consolidated revenue of ₹10,71,174 cr (+7.1% yoy)

• EBITDA of ₹1,83,422 cr (2.9% yoy) and

• a PAT of ₹81,309 cr (+2.9% yoy)

If you’ve ever dealt with RIL, you’d just have one word to describe them and that is ‘ruthless’. They’re ruthless when it comes to cutting costs or killing competition. This might as well be the gene that has helped them succeed across multiple industries.

Notably, their consumer businesses contributed over 50% of total EBITDA this time. This transformation from hydrocarbons to retail and digital has been written about endlessly. What hasn’t been in the limelight is how RIL uses its excess cash to seed its expansion and broaden its capabilities.

Over the past decade, RIL’s commitments to Alternative Investment Funds (AIFs) have risen from ₹967 crore in FY15 to ₹6,764.63 crore in FY25 - a nearly 600% increase, compounding at 21.5% annually.

This exposure is spread across 18 funds, both domestic and offshore, and routed via four subsidiaries:

• Reliance Strategic Business Ventures Limited (RSBVL),

• Reliance Ventures Limited,

• Reliance Digital Health Limited, and

• Reliance Finance & Investments USA LLC.

These subsidiaries give Reliance flexibility in targeting different themes: early-stage venture, private equity, real estate, hedge funds and even offshore allocations. Reliance’s approach looks less like that of a family-run conglomerate and more like that of an institutional allocator.

The portfolio itself tells the story. Its single largest position is in the Nepean Focused Investment Fund - Class A, a small and mid-cap equity vehicle worth ₹2,556 crore as of March 2025. The second largest, at ₹1,213 crore, is in Kalaari Capital Partners India IV, a venture fund that Reliance anchored in 2021. That relationship has already produced synergies: Reliance has acquired multiple Kalaari portfolio companies, including Embibe, Zivame, Haptik, and Urban Ladder. AIF commitments, in other words, are doubling as an M&A pipeline.

Other pieces are at different stages of their cycles. Reliance’s investment in Multiples Private Equity Fund II has shrunk from ₹215 crore in FY24 to ₹122 crore in FY25, as the fund has been distributing capital. Multiples recently set up a USD 430 million continuation vehicle to hold its strongest assets such as Vastu Housing Finance, Quantiphi, and APAC Financial…giving LPs like Reliance the option to cash out. Reliance largely did. On the other end, commitments to PGP India Growth Fund I have been rising as capital calls come in, while a tiny stake in the LICHFL Urban Development Fund is in wind-down.

Put together, this is a portfolio that resembles a miniature endowment model. Venture for optionality, private equity for cash-on-cash returns, hedge-style equities for higher beta, and legacy real estate. It’s designed to deliver better yield on surplus capital and just as important, getting strategic visibility into India’s innovation pipeline.

Reliance uses its LP commitments as strategic radar.

Where most LPs wait years for distributions, Reliance can act earlier. As a preferred LP, it gains visibility into themes, founders, companies and technologies. It can then selectively pull them into its own orbit - either through acquisition, partnership, or integration. In other words, it outsources discovery while retaining the right to capture the upside when it matters.