Few details have trickled out in the media. Thats the testimony to the fact that these brothers have an iron grip over what is reported and what isn’t.
The settlement hungama over, it was a sob story that was dragged in public. Perhaps one of the most damning exposures was the shareholding pattern of Reliance Infocomm. Frankly, it is beyond me as to how they managed to swindle the shares. No word of it now. Anil Ambani has made sure of that.
Once the hoopla settles down, I personally believe that splitting up Reliance was a folly. Why so? International lenders across the world were more happy to lend to a consolidated company- Reliance India Limited is a cash rich company. In any case, it was funding the infocomm venture. Fragmenting it means that they would be wary of lending it huge sums- leaving no option except to go in for an IPO. Incidentally that is being planned for, by the end of this year. Fund raising would be an important issue this year. There is another factor. Anil has “inherited” cash guzzlers. I really wonder whether he can pull off the “miracles” to make sure that Infocomm venture remains profitable. By last estimates, it was worth almost with losses and expensditues worth several thousand crores( some say almost upto 3500). The truth may never be known anyway.
Then, as I had mentioned earlier elsewhere, Anil has inherited the infocomm full of troubles. The regulatory mess, CBI enquiries( for the compromise of national security by rerouting calls), accusations over TRAI handling and infamous nexus with Pradeep Baijal- the TRAI chief;Broadband roll out mess and the battering on the Fixed Wireless- no one would be keen to get in the hot seat. It seems that Anil is looking out for CEO’s for his company. I wouldn’t like to stake for the top job under any circumstances! Yet, the name doing the rounds would be in a better position to leeway with the government and get the things done on their terms.
In any case, I would be following the Reliance story keenly. Why? Because, for the first time in my life I have been able to say that cheap calls are a reality. One day its going to be even cheaper than this. Backed by excellent infrastructure, they have managed to strike where others failed to do so(30% of the market share in what is keenly contested consumer pie.It’s been less than 2 years since the entered the scene). Plus, they have been able to learn from their mistakes(The earliest DAPO scheme was an abject failure-I heard that they are still honouring their commitments though they have discontinued the scheme). Who would have known that mobile handsets would be sold at neighbourhood grocery stores? Reliance made this possible to a large extent.
A lot goes behind the Reliance name indeed.