Reliance makes silent re-entry into petro retail

Mukesh Ambani’s Reliance Industries Ltd (RIL) today re-opened two petro retail outlets in Jamnagar without much fanfare.

The company had closed all its 1,400-odd retail outlets through the country last year, after sales dropped drastically due to its inability to match the subsidised prices offered by state sector oil marketing companies.

RIL is aiming to revive its 350-odd outlets in Gujarat and Maharashtra by the end of this month, followed by the rest of the country. Sources said the two outlets were selling only diesel and auto LPG at present. The company may sell only these two products for some time.

This has put to rest talk of RIL selling its retail outlets to other interested players, including Shell and Indian Oil Corporation (IOC). “It will take about a week or so to re-open a majority of our petrol pumps in Gujarat, followed by Maharashtra,” said an RIL spokesperson. Apart from Jamnagar, the company is looking at cities like Rajkot and Ahmedabad.

Industry sources said the company planned to re-open 50-60 outlets on highways in Gujarat and later look at outlets in Maharashtra. Reliance has over 1,400 petrol pumps, 60 per cent of which are in Gujarat and Maharashtra.

According to Jayantilal Contractor, director of the All India Motor Transport Congress, the premier union for truckers, RIL may re-open all its retail outlets as early as this week. “Initially, the company may price its products at competitive rates, unlike the last time when its rates were higher than that offered by the public sector companies. When you re-open an outlet after shutting it once, it takes effort to get customers. RIL may, therefore, introduce certain schemes to attract customers in a short time,” said Contractor.

In 2003, when RIL had first opened its outlets, it had come with free lunch offers, sources said.