Rivals in pursuit
TAKAFUMI HOTTA, Nikkei staff writer
MUMBAI -- Mukesh Ambani cannot be accused of frugality. The Reliance Group chairman's 170 meter-high residence in an exclusive Mumbai district was built at an estimated cost of $1 billion. India's richest man, Mukesh has ambitions that go beyond building India's most expensive residence.
Tata Group tops the list of India's conglomerates, but rivals such as Reliance have the potential to take top spot in the future. Reliance was founded in 1966. The group is relatively young in India, where many conglomerates have been in business for more than a century.
Dhirubhai Ambani, the father of Mukesh, developed his company into a major Indian conglomerate, which handles oil refineries, chemical fibers and other industrial operations.
After Dhirubhai died, a public feud ensued in 2005 for control of his conglomerate. Mukesh and his younger brother Anil split Reliance into two parts. Their sibling rivalry has apparently prodded both to expand their respective operations.
Reliance Industries, the core of the cluster of businesses for which Mukesh is responsible, has moved into retail and telecommunications. The company chalked up sales of 4.3 trillion rupees ($70.8 billion) for the year ended March 2014. Its sales are among the highest for a private-sector Indian company.
In June, the company unveiled plans to invest $30 billion in expansion over the next three years, ahead of Tata's announcement of its three-year investment plan.
The Ambani family hails from the western Indian state of Gujarat. It is on cordial terms with India's new Prime Minister Narendra Modi, who served as Gujarat's chief minister for more than 12 years. Attention is being paid to how Modi's economic reforms affect the conglomerate.
Further down the field
Aditya Birla Group, which comprises companies engaged in industries such as aluminium smelting, cellphone services and cement, is comparable to Tata and Reliance. The conglomerate's predecessor was founded by Ghanshyam Das "G.D." Birla, the iconic Indian industrialist who supported Mahatma Gandhi financially.
Anand Mahindra of the Mahindra Group, meanwhile, is considered by many to be the "foremost corporate leader in India." The group centers around the automobile business, which has increased its tech know-how through steps such as the acquisition of South Korea's Ssangyong Motor. It focuses on proprietary multipurpose SUVs. Mahindra has overtaken Tata Motors in terms of domestic auto sales.
Mahindra has entered the military equipment and aircraft businesses. It also began doing business in the tractor markets of China and other Asian countries recently.
These established industrial conglomerates are not Tata's only rivals. Emerging online marketplace operators, such as Snapdeal and Flipkart, also have the potential to compete. How India's traditional conglomerates work with or against these online companies in the future could impact the competitive dynamics of India's economy.