Reliance Industries into telecom, but not for public use

Reliance Industries is planning to rollout out a nationwide optical fibre network measuring upto 7000 kilometre at a cost of around Rs.800 crore. Through this network, Mukesh Ambani wants to connect its refineries, pipeline network, retail outlets, petrol pumps and logistics biz.

Reliance Industries earlier built a nationwide fibre optic network but after demerger, it was handed to Anil Ambani. And as per non-compete clause, Reliance Industries cannot enter telecom till 2015.

As such Reliance may rope in a third party to lay the network. Market sources estimates HFCL to be the frontrunner, as such it’s share price jumped up on the stock exchanges.

Through this venture, Reliance would gain through better communication and real time data interchanges. It would also reduce its dependancy on other companies like Bharti and BSNL.

Reliance Industries could also use this as a long term strategy by drawing synergies from its businesses and improve its infrastructure setup. via