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'Dhirubhai's second name was reliance'

"Dhirubhai Ambani's second name was reliance," said many an investor. Dhirajlal Hirachand Ambani or 'Dhirubhai,' as the world called him, was the kind of stuff legends are made of. He had the blessings of King Midas. Everything and anything he touched turned into gold.

People who backed him in his endeavours, knew this.

It has indeed been such a long journey for 'Dhirubhai' -- from the dusty unpaved lanes of Chorwad village in Gujarat's Junagadh district, where he was born on December 28, 1932, to the gold lined streets of Mumbai, where the business tycoon acquired an awesome reputation as a global businessman.

Dhirubhai rewrote all laws of corporate governance. He was a non-believer of the tried and tested business theories and chose to be a trail-blazer instead, with his own fire-brand style of management.

Conformist he may not have been, but those who chose to back Dhirbubhai's style of doing business came up trumps. For, the 'Dhirubhai school of management' firmly believed that the only thing which mattered at the end were results and the benefits which accrued directly to the shareholders.

Known as the 'messiah' of the investing public, the Reliance Group never skipped dividends for the investors.

Perhaps, Dhirubhai's affinity for the humble shareholder -- the common man -- who invested his hard-earned money in the Reliance Group, stemmed from his own humble beginnings.

From a school dropout to the 'king' of an approximately Rs 600 billion (revenue) empire, Dhirubhai was not only the protagonist in a 'rag-to-riches' story, but also the story himself.

From an initial investment of a mere Rs 15,000 in 1958 to start a trading house, followed by the setting up of his own tiny manufacturing unit in Gujarat in 1966, Dhirubhai, the son of a school teacher, managed to build up a synthetic yarn, textiles and petrochemicals empire that is today the third largest private sector mega corporation.

No adjectives are needed to describe RIL as it exists today. The figures are jaw-dropping, anyway. Analyse this: RIL, as it exists today, has a net worth of Rs 5.5 billion which is almost 3 per cent of India's gross domestic produce.

Its total market cap is Rs 287.46 billion and the empire has a workforce of over 85,000 people and an investors fraternity of five million.

"I am not a loser," Dhirubhai had once said. That can easily qualify as the understatement of the century. Dhirubhai's name features in most success stories and management text books, for what he achieved in a short span of just thirty years.

During his tenure as the head of the RIL, Dhirubhai undoubtedly took several business risks to get into the position where he was at the time of his death --one of the select Forbes billionaires.

He was voted as the 'Indian Businessman of the Century' by a worldwide multimedia poll held between August and October 1999 by Business Barons.

Like it happened with other success stories, competitors have cried foul occasionally. RIL has not been without its share of turbulence -- its run-ins with Bombay Dyeing's Nusli Wadia, its run-ins with the Indian Express Group of Newspapers, the controversial take over attempt of L&T are a few to name.

Reliance first went public in 1977 with one of the largest public offering of its time. While approaching the investors, Dhirubhai promised to create a 'khazana' (treasure house) for all his shareholders, most of whom were from the middle class.

He stormed the rural investor market, long before the investment fever gripped the middle-class in the early eighties.

Reliance, since then have been the biggest scrips in the market. Over the years, Dhirubhai created an extensive marketing network consisting of over 500 distributors, 2,500 showrooms and 34,000 retail outlets.

The customer base include 25,000 industrial customers in addition to the retailers throughout the country.

Reliance has made huge capacities at internationally competitive costs to become the world leader in petrochemicals.

Even in a crisis-ridden market in late 1997, when the oil prices dipped to the lowest in the decade, Dhirubhai did not relent. RIL's profit was up by 25 per cent from the previous year.

In 1991, he embarked on his most treasured project -- the largest single-feed ethylene cracker in the world. This plant in Hazira in Gujarat is the biggest chemical complex of Asia.

While the size helped, the group faced many other bottlenecks such as inadequate port facilities, erratic water supply and high costs.

To overcome all this, the senior Ambani went on to create his own facilities. He built jetties and a single buoy mooring, five kilometers off the coast, for large tankers to unload directly into storage tanks. He also ensured that All Reliance plants were self-sufficient in power.

Another feather in the Reliance cap was the Jamnagar plant in Gujarat -- the world's largest refinery with a capacity of 27 million tonnes per annum. With investments of nearly Rs 250 billion, the Jamnagar project, spread over 31 sq. kms, is the single largest investment ever made at any single location in India.

The entire project includes, besides the refinery, India's largest port terminal (50 million tonnes per annum), ten million tonne-capacity fully automated rail-road loading and product despatch terminal, 3.5 million tonne tank farms, 500 MW power plant, a sea-water desalination plant, 1,000 giga byte IT network connecting 50 servers and 2,500 terminals with 200 km long optic fibre cables.

The story does not end with Hazira or Jamnagar. Having gained the confidence after completing the Jamnagar complex, RIL is spearheading infrastructure development in the country -- be it ports, highways, airfields, power plants, water supply system or IT systems.

Ambani was always known to have enjoyed challenges. A fighter, Ambani senior always tried to safeguard investors' interest along with his company's.

On the afternoon of April 30, 1982, he took on a syndicate of brokers who were pushing down the share prices of his company. It had plummeted from Rs 131 to Rs 121 as more than 300,000 shares hit the market.

Challenging them, Ambani's brokers bought everything that was sold. When the buyers demanded the delivery of the shares, it was one of those rare occasions when the art of short selling lost its sheen.

The panicky bear cartel was forced to buy Reliance shares from all possible avenues. The crisis, in fact, made a hero out of Ambani. And since then, Reliance has remained a leader of the capital market.

Reliance under the leadership of Dhirubhai, covered most of the criteria for competitiveness including total integration, state-of-the-art technology, low-cost feed stock and cheap funding.

In fact, its cost of production is lowest in the world.

Another venture of the group, Reliance Mobile provides cellular telephony in 13 states. It has also been awarded 14 off-shore oil and gas exploration blocks by the government.

And the patriarch's thoughts on this three-decade trek? Dhirubhai believed that his success could be replicated.

Some time ago, he remarked, ''If one Dhirubhai can do so much, just think, what a thousand more Dhirubhais can do for the country? There are easily a thousand Dhirubhais, if not more. I firmly and sincerely believe in this. They are raring to join the race. Compete with the world. And make India an economic superpower.''

The biggest success story of Reliance was Dhirubhai's ability to carry people with him. From brilliant technocrats to financial whiz kids and high flier managers to small time dealers and messenger boys.

Assisted by his sons -- Mukesh Ambani, the vice chairman and managing director and Anil Ambani, who is also a managing director of the multi-billion group, Dhirubhai, unlike some of the other corporates of India, never had to face any internal revolt.

Mukesh's wife Nita a philanthropist has undertaken several relief works in Gujarat after the devastating quake and Anil's better half Tina Ambani nee Munim, a leading actress before marriage promotes art and culture and is famous for the Harmony show that she conducts every year.

Reliance also shot into international headlines by hosting the 1987 World Cup Cricket in India and Pakistan. The Aussies won the cup defeating England at the specially done up Eden Garden stadium in Calcutta, now rechristened Kolkata. It gave a big mileage to the company as it made forays into the sporting circles with a big bang.

The senior Ambani had suffered a heart stroke in 1986, which paralysed his right side. However, this had not deterred him in his crusade and he continued to work hard.

Thus, the last five decades were quite eventful in the life and times of Reliance and Dhirubhai. It was a time when corporate India had one czar, almost always, and that was Dhirubhai.

UNI

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