Reliance’s sketchy record of delivering returns to partners
Reliance has raised big capital from 13 entities. It now has to deliver returns to them, something it hasn’t done too well for partners in the past.
The Money Culture, Michael Lewis’s 1991 book on Wall Street excesses of the 1980s, brought to the mainstream a wordplay on ‘OPM’: other people’s money. It derided the practice of large corporations using the money of other companies and investors to make leveraged buyouts. Continents away, an Indian company was being lauded for imbibing OPM in its original form: operating profit margin. Reliance Industries Limited (RIL), as it was created and kept by founder Dhirubhai Ambani, aimed to implement projects on scale and break even at the operating level as fast as possible.