NEW DELHI: Reliance Industries Ltd invested over $ 125 billion in the last ten years as it undertook massive expansion in hydrocarbon and telecom businesses, a report said, estimating that the conglomerate’s investments in the next three years would be in relatively less capex-heavy retail and upstream new energy.

Reliance is coming out of a series of long and intensive capex cycles (hydrocarbons and telecom).

“The company has invested nearly $ 30 billion between FY13-18 to increase scale, integration and cost competitiveness of the O2C (oil to chemical) business, and close to $ 60 billion between FY13-24E in 4G/5G capabilities to create a high-growth telecom business,” Goldman Sachs said in a deep dive report on Reliance.

With the pan-India 5G rollout now likely completed and potential telecom tariff hikes ahead, it expected the telecom business to become a strong free-cash-flow (FCF) generation business alongside current cash cow O2C (which comprises its mega oil refinery and petrochemical complexes).

“We believe the businesses RIL is investing more in the next 3 years (retail and upstream new energy) are relatively less capex heavy, higher in returns and have a shorter gestation period,” it said. A refining or petchem facility would usually take at least five years to start up (construction and ramp-up time) versus about two years for an integrated poly-to-module solar facility and 6-12 months to ramp up a retail store.

“RIL has invested over $125 bn in capex in the last 10 years, mostly in hydrocarbon and telecom, which are more capex intensive and have a longer gestation period,” it said.

“While the capex cycle for hydrocarbons and telecom 4G completed during FY17-19, we saw an accelerated telecom capex cycle in 5G, which is now completing in FY24.”