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Dhirajlal Hirachand Ambani, popularly known as Dhirubhai Ambani (28 December 1932 – 6 July 2002) was an Indian business tycoon[1] who founded Reliance Industries in Bombay and appeared in The Sunday Times top 50 businessmen in Asia.[2] Ambani took Reliance public in 1977 and was worth $51 billion[3] upon his death on 6 July 2002.[4] In 2016, he was honored posthumously with the Padma Vibhushan, India's second highest civilian honor for his contributions to trade and industry.[5][6]

Dhirubhai Ambani
Dhirubhai Ambani 2002 stamp of India.jpg
Born
Dhirajlal Hirachand Ambani

(1932-12-28)28 December 1932
Died6 July 2002(2002-07-06) (aged 69)
NationalityIndian
OccupationFounder of Reliance Industries (RIL)
Founder of Reliance Capital, Reliance Infrastructure & Reliance Power (which were later carved out from RIL)
Spouse(s)Kokila Dhirubhai Ambani
ChildrenMukesh Ambani
Anil Ambani
Nina B. Kothari
Dipti D. Salgaocar
AwardsPadma Vibhushan (2016)

Early careerEdit

Dhirubhai Ambani was one of the sons of Hirachand Gordhanbhai Ambani, a village school teacher belonging to the Modh community and Jamnaben Ambani and was born in Chorwad, Junagadh district, Gujarat.[7] Dhirubhai married Kokila, and they had four children; Mukesh Ambani, Anil Ambani, Nina Bhadrashyam Kothari and Dipti Dattaraj Salgaocar. He migrated to the then British colony of Aden at age 17 where his brother was working.[8] He initially served as a clerk at A. Besse & Co., which then was the largest transcontinental trading firm east of Suez.[9] He worked as a employer in Yemen, then came to India with ₹50000 and started a textile trading company in 1958.[10].

Founding of Reliance IndustriesEdit

Ambani returned to India and started "Majin" in partnership with Champaklal Damani, his second cousin,[11] who lived with him in Yemen. Majin was to import polyester yarn and export spices to Yemen.[12] The first office of the Reliance Commercial Corporation was set up at the Narsinatha Street in Masjid Bunder.[13] It was a 350 sq ft (33 m2) room with a telephone, one table and three chairs. Initially, they had two assistants to help them with their business. During this period, Ambani and his family stayed in a two-bedroom apartment at the Jai Hind Estate in Bhuleshwar, Mumbai.[12] In 1965, Champaklal Damani and Dhirubhai Ambani ended their partnership and Ambani started on his own. It is believed that both had different temperaments and a different take on how to conduct business.[14] While Damani was a cautious trader and did not believe in building yarn inventories, Ambani was a known risk-taker and believed in building inventories to increase profit. In 1966 he formed Reliance Commercial Corporation which later became Reliance Industries on 08 May 1973.

Ambani's control over stock exchangeEdit

Extensive marketing of the brand in the interiors of India made it a household name. Franchise retail outlets were started and they sold the "only Vimal" brand of textiles. In the year 1975, a technical team from the World Bank visited the 'Reliance Textiles' Manufacturing unit.

In 1988, Reliance Industries came up against a rights issue regarding partly convertible debentures.[15] It was rumoured that the company was making all efforts to ensure that their stock prices did not slide an inch. Sensing an opportunity, The Bear Cartel, a group of stock brokers from Calcutta, started to short sell the shares of Reliance. To counter this, a group of stock brokers until recently referred to as "Friends of Reliance" started to buy the short sold shares of Reliance Industries on the Bombay Stock Exchange.

The Bear Cartel was acting on the belief that the Bulls would be short of cash to complete the transactions and would be ready for settlement under the "Badla" trading system operative in the Bombay Stock Exchange. The bulls kept buying and a price of 152 per share was maintained until the day of settlement. On the day of settlement, the Bear Cartel was taken aback when the Bulls demanded a physical delivery of shares. To complete the transaction, much money was provided to the stock brokers who had bought shares of Reliance, by Dhirubhai Ambani. In the case of non-settlement, the Bulls demanded an Unbadla, or penalty sum, of 35 per share. With this, the demand increased and the shares of Reliance shot above 180 in minutes. The settlement caused an enormous uproar in the market.[citation needed]

To find a solution to this situation, the Bombay Stock Exchange was closed for three business days. Authorities from the Bombay Stock Exchange (BSE) intervened in the matter and brought down the "Unbadla" rate to 2 with a stipulation that the Bear Cartel had to deliver the shares within the next few days. The Bear Cartel bought shares of Reliance from the market at higher price levels and it was also learnt that Dhirubhai Ambani himself supplied those shares to the Bear Cartel and earned a healthy profit out of The Bear Cartel's adventure.[16]

After this incident, many questions were raised by his detractors and the press. Not many people were able to understand how a yarn trader until a few years ago was able to get in such a huge amount of cash flow during a crisis period. The answer to this was provided by the then finance minister, Pranab Mukherjee in the Parliament. He informed the house that a Non-Resident Indian had invested up to 220 million in Reliance during 1982–83. These investments were routed through many companies like Crocodile, Lota and Fiasco. These companies were primarily registered in Isle of Man. All the promoters or owners of these companies had a common surname Shah. An investigation by the Reserve Bank of India in the incident did not find any unethical or illegal acts or transactions committed by Reliance or its promoters.[17]

DeathEdit

Ambani was admitted to the Breach Candy Hospital in Mumbai on 24 June 2002 after he suffered a major stroke. It was his second stroke, the first had occurred in February 1986 and had paralyzed his right hand. He was in a coma for more than a week and a number of doctors were consulted. He died on 6 July 2002.[18]

The country has lost iconic proof of what an ordinary Indian fired by the spirit of enterprise and driven by determination can achieve in his own lifetime.[19]

This new star, which rose on the horizon of the Indian industry three decades ago, remained on the top until the end by virtue of his ability to dream big and translate it into reality through the strength of his tenacity and perseverance. I join the people of Maharashtra in paying my tribute to the memory of Ambani and convey my heartfelt condolences to the bereaved family.[20]

— P C Alexander, former Governor of Maharashtra

Reliance Industries after Dhirubhai Ambani's deathEdit

Following his first stroke in 1986, Ambani handed over control of Reliance to his sons, Mukesh and Anil. In November 2004, Mukesh in an interview admitted to having differences with Anil over ownership issues[21]. He also said that the differences "are in the private domain".[22] After the death of Dhirubhai Ambani, the group was split into Reliance Industries Limited headed by Mukesh, and Reliance Anil Dhirubhai Ambani Group headed by Anil.

As of 2017, the company has more than 250,000 employees. In 2012, Reliance Industries was one of the two Indian companies to be ranked among the top 100 in the Fortune 500 list of the world's largest companies by revenue.[23]

In popular mediaEdit

In 1988 an unauthorized biography of Dhirubhai Ambani, by Hamish McDonald with the title The Polyester Prince, outlined all his political and business conquests. The book was not published in India because the Ambanis threatened legal action;[24] an updated version went on sale under the title Ambani and Sons in 2010, and there has been no action against the publisher so far.[24]

A Hindi film said to be loosely inspired by the life of Dhirubhai Ambani was released on 12 January 2007. Guru, directed by filmmaker Mani Ratnam, cinematography by Rajiv Menon and music by A.R.Rahman shows the struggle of a man striving to make his mark in the Indian business world with a fictional Shakti Group of Industries.

Awards and recognitionEdit

 
Dhirubhai Ambani, on postal stamp 28 December 2002.
  • 1996, 1998 and 2000– Featured among Power 50-the most powerful people in Asia by Asiaweek magazine.
  • June 1998 – "Dean's Medal" by The Wharton School, University of Pennsylvania, for setting an outstanding example of leadership. Dhirubhai Ambani was the first Indian to receive the Dean's Medal[25]
  • November 2000–Conferred Man of the Century award by Chemtech Foundation and Chemical Engineering World in recognition of his outstanding contribution to the growth and development of the chemical industry in India.
  • August 2001 – Economic Times Awards for Corporate Excellence for Lifetime Achievement.
  • Dhirubhai Ambani was named the "Man of 20th Century" by the Federation of Indian Chambers of Commerce and Industry (FICCI).
  • India post released a postal stamp featuring Dhirubhai Ambani on 28 December 2002.
  • October 2011- posthumously awarded the ABLF Global Asian Award at the Asian Business Leadership Forum Awards.
  • January 2016- posthumously awarded the Padma Vibhushan, the country's second-highest civilian award .[26]

See alsoEdit

ReferencesEdit

  1. ^ Muthyala, Srikar (29 September 2015). "The List of Great Entrepreneurs of India in 2015". MyBTechLife. Archived from the original on 14 January 2016.
  2. ^ Dhirubhai Ambani Archived 7 July 2011 at the Wayback Machine. 4to40.com
  3. ^ Mukherjee, Arindam. Dhirubhai estate was worth $51b in 2002. Outlookindia.com. Retrieved on 2018-11-15.
  4. ^ Dhirubhai Ambani vs Ratan Tata – Difference and Comparison. Diffen. Retrieved 28 July 2013.
  5. ^ "Padma Awards 2016". Press Information Bureau, Government of India, Ministry of Home Affairs. 25 January 2016.
  6. ^ "Padma Awards 2016: Full List". NDTV.com. 25 January 2016.
  7. ^ Lodha, CA Hemant C. (2014). A to Z of Entrepreneurship: A to Z of Entrepreneurship. Panchasil Prakashan. p. 12. ISBN 9788192373058.
  8. ^ "Balmy days with Dhirubhai in Aden — A `reliable' friend has fond memories". The Hindu Business Line. 29 July 2002. Retrieved 20 May 2019.
  9. ^ Dhirubhai Ambani, INDIAN BUSINESSMAN, Karen Sparks, Encyclopaedia Britannica, Dec 31, 2002
  10. ^ Majumdar, Shyamal (14 January 2015). "40 years ago... and now: Dhirubhai Ambani changed the idiom of doing business". Business Standard India. Retrieved 20 May 2019.
  11. ^ Ambani: From a petrol pump attendant to Reliance owner | Arab News – Saudi Arabia News, Middle East News, Opinion, Economy and more. Arabnews.com (2 November 2012). Retrieved 28 July 2013.
  12. ^ a b Giridharadas, Anand (15 June 2008). "Indian to the Core, and an Oligarch". The New York Times.
  13. ^ "Reliance Industries - The Reliance Story". www.ril.com. Retrieved 20 May 2019.
  14. ^ "Carving up a Business Empire Through Tax Havens: The Ambani Way". NewsClick. 18 May 2018. Retrieved 20 May 2019.
  15. ^ "The two faces of Dhirubhai Ambani by Paranjoy Guha Thakurta". India-seminar.com. Retrieved 31 December 2010.
  16. ^ Barua, S.K. and Verma, J.S. (1993) The Great Indian Scam, Story of Missing Rs. 40 billion. University of California. ISBN 8170941288. pp. 16–17
  17. ^ "rediff.com: For this fighter, life was a big battle". Rediff.com. Retrieved 31 December 2010.
  18. ^ Reliance chairman Dhirubhai Ambani dead The Times of India (7 July 2002). Retrieved 28 July 2013.
  19. ^ "Indian business giant dies". BBC News. 7 July 2002. Retrieved 19 May 2019.
  20. ^ "Politicians, celebrities pay homage to Ambani". Rediff. 7 July 2002. Retrieved 31 December 2010.
  21. ^ Badkar, Mamta (26 May 2011). "The Full Story Of The Massive Feud Between The Billionaire Ambani Brothers". Business Insider. Retrieved 20 May 2019.
  22. ^ "Mukesh Ambani admits to differences with Anil". Rediff.com. 18 November 2004. Retrieved 31 December 2010.
  23. ^ Pandey, Piyush (9 July 2012). "Indian Oil, Reliance Industries in Fortune 500 companies list". The Times of India. Retrieved 9 November 2017.
  24. ^ a b "The return of The Polyester Prince". Business Standard. 2 October 2010. Retrieved 12 September 2012.
  25. ^ Diwanji, A. K. (June 1998) Dhirubhai Ambani becomes first Indian to get Wharton School Dean's Medal. Rediff
  26. ^ "Padma awards 2016 declared: Anupam Kher, Rajinikanth, Vinod Rai, Sania Mirza honoured among others". DNA. 25 January 2016.

External linksEdit