Aug 30: India-Japan ink $68B pact, Reliance shares big plans in AGM

Good morning! Picture this, you’re on about your day, enjoying that packet of Magic Masala you’ve earned after a hard day’s work and you get a call from an unknown number. It’s Trump asking for donations to a MAGA Super PAC. Don’t hang up, it might literally be him. In what is Chinese-hacker-wet-dream territory, the US President reportedly continues to use his personal phone to contact people including international leaders from the Oval Office. The habit may have stumped Modi as well who reportedly missed 4 calls from Trump in the midst of the tariff anban. Can’t blame him, these scam calls are outta control.

Now, let’s get into the Dispatch! 🚀

Today’s reading time is 6.5 mins.

Indian stock market fell for the third consecutive session primarily due to continued concerns about tariffs, almost wiping out Sensex’s gains year to date.

At the 48th Annual General Meeting of Reliance Industries Ltd. (RIL), Chairman Mukesh Ambani, joined by family, laid out an ambitious vision for the group’s next decade of growth. The announcements spanned FMCG, AI, clean energy, healthcare and a much-awaited confirmation of Jio’s IPO timeline.

FMCG and Retail Expansion: Isha Ambani confirmed that Reliance Consumer Products Ltd. (RCPL), the FMCG arm, will become a direct subsidiary of RIL. The aim: ₹1 lakh crore in revenue over five years. RCPL will also be Reliance’s “blueprint” for expansion into apparel, electronics, and other high-value categories. Reliance Retail, which posted revenues of ₹3.3 lakh crore, is being positioned as a “national movement,” with in-house brands like Independence (grocery), Avaasa (fashion), and Kelvinator (electronics).

Jio IPO in 2026: Mukesh Ambani made the headline announcement of the day: Reliance Jio will file for its IPO in the first half of 2026, subject to regulatory approvals. He called it a “very attractive opportunity for all investors,” noting Jio’s capability to create value at par with global tech giants. With regards to JioHotstar Akash Ambani added that they are now preparing to take its services beyond India, signalling an international push.

AI and Reliance Intelligence: Mukesh Ambani also unveiled Reliance Intelligence, a new wholly owned subsidiary to spearhead India’s AI revolution. The company will build green-powered, gigawatt-scale data centres and deliver AI services for consumers, enterprises, and national sectors. Partnerships in AI were also front and centre:

Clean Energy and Industrial Investments: Anant Ambani outlined Reliance’s New Energy ecosystem, with giga-battery factories (launching 2026), a solar project three times Singapore’s size, and 3 million tonnes of green hydrogen capacity by 2032. On industrial projects, RIL is investing ₹75,000 crore in expansions, including:

Healthcare and Social Impact: Nita Ambani announced a new 2,000-bed medical city in Mumbai, integrating AI-powered diagnostics and global-standard care, alongside “Jeevan,” a paediatric wing at H. N. Reliance Hospital. She also reaffirmed Reliance Foundation’s role in India’s bid to host the 2036 Olympics, and shared that Reliance Foundation’s initiatives now reach 87 million people across 91,500 villages.

Financials and Legacy: Mukesh Ambani underlined RIL’s transformation into a Fortune 40 global powerhouse, generating $200 billion in value within India. In FY25, RIL crossed $125 billion in annual revenues, with ₹81,309 crore net profit and ₹2.8 lakh crore exports. 

Market reaction: Despite growth talks all around, shares of RIL ended 2.3% lower on the day as investors remained cautious due to the ongoing uncertainty.

Net net: India’s economy expanded at a faster-than-expected pace in the April–June quarter of FY26, with GDP rising 7.8% year-on-year, based on data released by the Ministry of Statistics on Friday. The growth rate, a five-quarter high, comfortably beat RBI’s forecast of 6.5% and consensus market expectations of around 7%. This marks the second consecutive quarter of outperformance.

Services Drive Upside: The bulk of the upside came from the services sector, which clocked 9.3% growth, the highest in two years. Within services Financial, Real Estate and Professional Services expanded by 9.5%, while Public Administration, Defence and Other Services surged 9.8%, reflecting robust government spending.

Agriculture, Manufacturing Support Expansion: The agriculture sector grew below average by 3.7% but more than double compared to last year’s 1.5% growth in the same quarter. Manufacturing expanded 7.7%, a sharp improvement over the 4.8% growth in the previous quarter, offering key support to overall growth. Mining and utilities lagged, with Gross Value Added in “Mining & Quarrying” contracting due to heavy rainfall disrupting activity. Electricity, gas, and water supply also saw weak growth of just 0.5%, reflecting reduced demand. Additionally, construction activity slowed to 7.6%, a nine-quarter low.

Real vs Nominal: Nominal GDP (which does not account for inflation or deflation) slowed to 8.8% over April-June, compared to 10.8% in the previous quarter. This is because India’s consumer inflation continued to ease in July, dropping for a ninth straight month to 1.55%, below analysts’ estimates, to its lowest level since June 2017.

Full year growth: Experts estimate that Growth for the full year is still likely to average around 6.5%, even after factoring in tariff headwinds - illustrating India’s position as the world’s fastest-growing large economy.

Shrimp shocker: India's shrimp exports could fall by 15-18% this year, as the U.S. has jacked up its import tariff to a huge ~58%. This hits a market that makes up 48% of India's shrimp exports. 

₹ troubles: The Indian rupee hit a new low of 88.19 against the dollar, a 61-paise drop due to US tariffs on Indian exports, weak domestic stocks, and foreign fund outflows. 

Ethanol backlash: India's push for 20% ethanol-blended fuel is sparking backlash from drivers who report lower mileage and engine damage, as most vehicles aren't E20-compatible. Automakers are also concerned.  

Maharashtra’s MoU milestone: Maharashtra's government has signed 17 MOUs worth ₹33,768 crore with a plan to create 33k+ jobs in electronics, steel, solar, EV buses/trucks, and defence. The state is promising a smooth experience with a single-window "Maitri" portal and a new five-year plan to cut power tariffs.  

Grow goes public: SEBI has cleared Groww's IPO, aiming to raise $700 million - $1 billion at a $7-8 billion valuation. In FY25, the company had a ₹4,056 crore revenue and ₹1,818 crore PAT, with over 12.3 million active clients.