From Bankruptcy to Electric Dreams: Anil Ambani’s Resilient Reinvention

They say that when life gives you lemons, you make lemonade. Well, in the case of Anil Ambani, it seems he’s taking that adage to a whole new level – swapping out lemons for lithium-ion batteries and electric motors.

That’s because reports are rife about Reliance Infrastructure, led by Anil Ambani, reportedly looking to foray into the electric vehicle (EV), going so far as to hire a former India executive of BYD, to strategize its EV vision. The company is also evaluating the business viability of an EV factory, with further cost feasibility studies exploring the business potential of a 10 gigawatt-hour (GWh) battery factory.

It is a bold move by Ambani, who was once worth a staggering $42 billion only to later declare bankruptcy in a UK court. But one shouldn’t bet against the younger Ambani brother bouncing back from the brink.

Anil Ambani’s Rollercoaster Ride: From Riches to Ruin and Back Again

Anil Ambani’s journey has been nothing short of a Bollywood blockbuster, complete with dramatic twists, unexpected setbacks, and a cast of colourful characters. From the dizzying heights of being the world’s sixth-richest person to the humbling depths of bankruptcy, he’s seen it all. The acrimonious split of the Reliance empire after his father’s passing left him in control of sunrise sectors like Reliance Communications (RCom), Reliance Capital (RCap), and Reliance Infrastructure. But as they say, with great power comes great financial responsibility – and Anil seemed to struggle with the latter.

The Rise and Fall of Reliance Power

One of the most notorious episodes in Anil’s storied career was the unprecedented success of the Reliance Power initial public offering (IPO) in 2008. This was the biggest IPO in India’s history at the time, with brokers and investors lining up to bet their life savings on the company. The only problem? Reliance Power’s profits were a mere Rs 16 lakh – a far cry from the lofty valuation it commanded. The IPO was fully subscribed in under a minute, and within hours of listing, the share price plummeted, wiping out billions in investor wealth. It was a classic case of hype over substance, and a stark reminder that Anil’s expansionist strategies weren’t always grounded in reality.

The Downfall of Reliance Communications: A Debt-Fuelled Demise

The collapse of a $2 billion deal with South African telecom giant MTN in 2008 marked the beginning of the end for Reliance Communications (RCom). Intended to alleviate the debt burden on the flagship company, the failed transaction sent RCom spiralling into a downward spiral. Once a leading player in the Indian telecom space, RCom soon found itself drowning in debt, unable to compete with the likes of Jio and Airtel. By 2019, the company was forced into insolvency, a far cry from its glory days.

Anil Ambani’s Brush with Imprisonment

The financial troubles didn’t stop there. In 2019, the Supreme Court threatened to jail Anil Ambani after RCom failed to pay Rs 550 crore owed to Ericsson AB. It was only through the intervention of his brother Mukesh, who stepped in to pay off the debt, that Anil avoided imprisonment. But the financial crisis continued to deepen, with three Chinese banks suing him in a London court over a $680 million loan default.

The Bankruptcy Bombshell: Anil Ambani’s Darkest Hour

As if these setbacks weren’t enough, 2020 saw Anil Ambani declare bankruptcy in a UK court, claiming that his net worth had shrunk to virtually nothing. The following year, Reliance Capital (RCap), another key firm in his group, filed for bankruptcy after defaulting on bonds worth Rs 24,000 crore. It was a humbling fall from grace for a man who had once commanded such immense wealth and power.

2024 started on a sour note as well, with the Supreme Court overturning a Rs 8,000-crore arbitral award tied to Reliance Infrastructure’s metro subsidiary. This decision further strained his already precarious financial situation, leaving him scrambling to find new ways to shore up his dwindling resources.

Despite the numerous challenges and setbacks he has faced, Anil Ambani is not one to give up easily. As he navigates his way through this latest chapter in his storied career, he is turning to the next generation of Ambani entrepreneurs – his sons, Jai Anmol and Anshul. The brothers are reportedly working tirelessly to revive the group’s fortunes, with plans to make Reliance Power debt-free by the fiscal year 2025.

Anil’s Foray into Electric Vehicles: A Bold Reinvention

Now, in a surprising twist, Anil Ambani is setting his sights on the electric vehicle (EV) market. Reliance Infrastructure, one of his remaining key firms, is planning to manufacture electric cars and batteries, and has even hired a former BYD executive to strategize its plans. The company is also conducting cost feasibility studies for setting up an EV plant with an initial capacity of 250,000 vehicles per year, which it aims to scale up to 750,000 over the coming years. Additionally, Reliance Infrastructure is exploring the possibility of a battery plant with 10 gigawatt hours of capacity, which could be expanded to 75 GWh over the next decade.

This move by Anil Ambani puts him in direct competition with his elder brother, Mukesh Ambani, whose company is already working to manufacture batteries locally and has won a bid to receive government incentives for 10 GWh of battery cell production. It’s a fascinating twist in the ongoing saga of the Ambani brothers, as they now find themselves vying for a piece of the rapidly growing Indian EV market.

The Road Ahead: Anil Ambani’s Ambitious EV Plans

If Anil’s group nails these ambitious EV plans, it could catapult him back into the big time. The Indian EV market, while still in its nascent stages, is poised for exponential growth, with the government targeting a 30% share of electric vehicles in the overall car sales by 2030. Anil’s move to enter this space could be a strategic gamble, one that could potentially help him rebuild his tarnished reputation and script a new chapter in his tumultuous career.