Saudi Aramco chairman reappointed independent director on Reliance Industries board

Reliance Industries Limited (RIL), one of India’s largest conglomerates, has announced the reappointment of Yasir Al Rumayyan, chairman of Saudi Aramco, as an independent director on its board for a five-year term.

The decision was confirmed through a postal ballot and detailed in a stock exchange filing.

Al Rumayyan, who also heads Saudi Arabia’s Public Investment Fund (PIF), one of the world’s largest sovereign wealth funds, was initially appointed to RIL’s board in 2021 for a three-year term set to expire on July 18, 2024.

With the new resolution, his tenure has been extended until July 18, 2029.

Sh Mukesh Ambani announcing induction of HE Yasir Al Rumayyan Chairman of Saudi Aramco #RILAGM #RelianceIndustries #MukeshAmbani #Reliance #RelianceJio pic.twitter.com/CbAD8LyWfK

— Pankaj Upadhyay (@pankaju17) June 24, 2021

The move comes as RIL continues to strengthen its ties with Saudi Arabia and seeks to leverage Al Rumayyan’s expertise in global finance and investment.

Mukesh Ambani, chairman and managing director of RIL, previously announced Al Rumayyan’s induction as a replacement for YP Trivedi in 2021, marking a significant milestone in RIL’s board composition.

Votes for Aramco chairman

However, the decision was met with some resistance, with 16.02 per cent of shareholders voting against Al Rumayyan’s reappointment, reported Indian news media. Despite this, the resolution passed with 83.97 per cent support, indicating strong backing from the majority but highlighting a fracture among the investor base.

This dissent contrasts with the overwhelming support the Aramco chief received during his initial appointment in 2021, when he secured 94.90 per cent approval from public institutions and 99.91 per cent from non-institutional investors.

RIL’s new appointees

RIL also secured shareholder approval for the appointment of Haigreve Khaitan, a senior partner at the law firm Khaitan & Co, as an independent director starting April 1, 2024, for a five-year term.

Khaitan’s appointment is seen as a strategic move to bring robust legal expertise to the board, filling a gap left since the departure of the late ML Bhakta, a founding partner of Kanga & Co, who served on the board for 42 years until stepping down in 2019. The resolution for Khaitan’s appointment passed with 87.15 per cent in favour, though 12.84 per cent of shareholders voted against it.

In addition to these appointments, the reappointment of PMS Prasad, a long-serving executive at RIL, as a director for another five years was approved with 93.69 per cent of the vote, with 6.3 per cent voting against. Prasad has been instrumental in RIL’s strategic and operational initiatives, and his continued presence on the board is expected to provide stability and continuity.

RIL’s recent appointments reflect its strategic direction and the need to adapt to the evolving business environment. As the company expands its global footprint and diversifies its operations, the expertise and guidance of its board members will be crucial in steering RIL towards sustained growth and innovation.

These board changes come as RIL continues to navigate its transformation into a global player in the energy, retail, and digital sectors.

However, the mixed shareholder response highlights the challenges RIL faces in balancing diverse investor expectations while pursuing its strategic objectives.

Financial performance

RIL reported robust financial results for the fiscal year 2023-24 and the fourth quarter ending March 31, 2024. The company showcased significant growth across key financial metrics.

Full year FY2024 highlights

• Gross Revenue: ₹1,000,122 crore ($119.9bn)
• EBITDA: ₹178,677 crore ($21.4bn)
• Profit After Tax: ₹79,020 crore ($9.5bn)
• Capital Expenditure: ₹131,769 crore ($15.8bn)

Q4 FY2024 highlights

• Gross Revenue: ₹264,834 crore ($31.8bn)
• EBITDA: ₹47,150 crore ($5.7bn)
• Profit After Tax: ₹21,243 crore ($2.5bn)
• Capital Expenditure: ₹23,207 crore ($2.8bn)

These results reflect RIL’s strong operational performance and strategic investments, positioning it for sustained growth in the future. The company’s diverse portfolio and continued focus on innovation and expansion have been pivotal in achieving these milestones.

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