Is Reliance Industries on course to becoming a holding company? That was the question that observers asked as the company on Thursday announced that it will carve out the oil-to-chemicals business (O2C).

This comes even as RIL has already created a subsidiary — Jio Platforms Ltd (JPL) — which consists of all its digital services business, including Jio. Market circles do not rule out the possibility of RIL hiving off Reliance Retail as well at a later date. If this is done, RIL could become a holding company.

RIL on Thursday announced that its board has approved a scheme of arrangement for the transfer of its O2C undertaking to Reliance O2C Ltd as a going concern on slump sale basis. The O2C undertaking of RIL comprises the entire oil-to-chemicals business consisting of refining, petrochemicals, fuel retail & aviation fuel.

Simultaneously RIL disclosed that the due diligence by Saudi Aramco for the planned investment in RIL’s O2C business was on track and that both the parties were committed and actively engaged. At its annual general meeting last August, RIL chief Mukesh Ambani had disclosed that Aramco will pick up a 20 per cent stake in the O2C business for $15 billion.

As part of the deal, Aramco will supply 500,000 barrels per day (25 million tonnes a year) of crude on a long-term basis to RIL’s Jamnagar refinery complex.

In a recent report, Bernstein had said that it expects RIL to grow its petrochemical and refining business given the growth opportunities.

“While bears will argue that Reliance is stepping away from energy to digital, we see this deal as an opportunity to expand the downstream business in India with a solid partnership. For Aramco, the deal provides direct access to what is widely expected to be the fastest-growing refined oil product market over the next 20 years,” it said.

This comes as the organised retail business delivered yet another year of highest ever revenue and earnings before interest, taxes, depreciation and amortisation (EBITDA) for RIL despite a challenging environment.

Reliance Retail which operates 11,784 stores covering 28.7 million square feet saw footfalls at 64 crore which was a growth of 17 per cent over last year. The segment revenues for this business grew by 24.8 per cent to Rs 162,936 crore.