Billionaire Mukesh Ambani-led Reliance will rival FMCG food businesses of ITC, Tata Consumer Products Ltd and Adani Wilmar with launch of brand 'Independence' for staples, processed foods, beverages and other daily essentials, analysts said.

Reliance Consumer Products Ltd (RCPL), the newly set up FMCG arm of Reliance Retail Ventures Ltd (RRVL) last week made a foray into staples with launch of brand Independence in line with announcement Ambani had made at the company's annual shareholder meeting earlier this year.

RRVL is a wholly-owned subsidiary of Reliance Industries Ltd (RIL).

The launch is only in Gujarat, possibly on a pilot testing basis, and has indicated that products would be affordably priced. Post development of the brand, it will be rolled out nationally.

It will be "competing with Adani Wilmar in edible oil, grains and pulses; Patanjali Foods in biscuits, edible oil, packaged atta; Parle and Britannia in biscuits; Tata Consumer in pulses, packaged water; and ITC in packaged atta, biscuits," brokerage Nomura said.

Independence line of products will be available on the Jio Mart app and Reliance retail stores currently. In coming months, the distribution is to be extended to FMCG retailers (kirana stores).

The categories include biscuits, packaged water, edible oil, packaged atta (wheat flour), besan (gram flour), pulses, grains and sugar.

"RCPL is a newly-incorporated company despite RRVL already having a range of private-label brands which are sold across its 2,460 brick and mortar grocery stores and Jio Mart app which reaches 2 million merchant partners/kirana stores across 260 cities," Nomura said.

"We note it also incorporated another company (Reliance Beauty and Personal Care Ltd) on November 28, 2022. We believe RIL is incubating newer separate companies with the idea of listing them over the medium term and unlocking value."

RRVL's existing key private label brands are: Good Life for pulses, flour, rice, oils; Snac Tac for noodles, biscuits, namkeen; Enzo for detergents; Puric/Get Real for soap, hand wash, hair oil, shower gel; and Scrubz/Expelz/Mopz for dish wash, toilet, surface cleaner.

In August 2022, RRVL had also acquired soft drink brands Campa Cola and Sosyo. "By creating a new company, despite having private-label brands under RRVL, we see it as a first of many steps for Reliance to participate fully into the staples/FMCG space outside its own distribution network," Nomura said.

"However, the actual distribution reach of Independence brand into kirana stores, acceptance from consumers, its product price points/addressable market, and product innovation will be key before concluding Reliance's foray will be a headwind for FMCG companies."

Its entry of another large player in staples/packaged foods will aid and accelerate conversion from unbranded to branded products, thus benefiting and growing the staples/packaged foods categories as a whole.

"We expect Reliance Retail to leverage its tie-up with WhatsApp to enable sales for its branded products across WhatsApp's significant user base in the coming years as well. Reliance Retail has adequately integrated JioMart on WhatsApp to provide a convenient end-to-end shopping experience from discovery to payments without having to exit the application," it added.