Reliance Retail led by Mukesh Ambani is facing a problem of valuation drop with analysts now estimating the company’s worth at $50 billion less than half of the $125 billion valuation it achieved during a fundraising round in 2022. The sharp decline has prompted Reliance Retail to start cost-cutting measures and strategic adjustments to improve investor confidence as it prepares for its highly anticipated initial public offering (IPO). Challenges In Valuation  Reliance Retail is now experiencing problems like slowing sales and rising operational challenges. The valuation cut as per the Bloomberg report comes amid broader market uncertainties and concerns raised by analysts at Ambit Capital Pvt. Kotak Institutional Equities and Sanford C. Bernstein. Mukesh Ambani has reportedly acknowledged to investors that the company’s rapid expansion into diverse retail formats and geographic locations contributed to these issues. The ambitious growth strategy while initially successful is now being reworked to emphasize profitability and operational streamlining. Reliance Retail Cost-Cutting Measures To navigate the downturn Reliance Retail has undertaken several significant restructuring efforts: Job Reductions: The company has laid off 38000 employees in 2024 as revealed in company filings. Slower Store Expansion: The pace of opening new stores has been considerably reduced to curb costs. Marketing Cuts: Reliance has reduced marketing expenditures particularly for its Ajio online platform as part of its cost-saving strategy. Integration of Reliance Brands: The luxury arm Reliance Brands Ltd. is being merged into the broader retail business to enhance operational efficiency. Stricter Hiring Policies: New hiring policies mandate approval from Mukesh Ambani’s office for positions with annual salaries exceeding $22890. Additionally even store-level staff hiring now requires approval from Managing Director V Subramaniam a responsibility previously delegated to lower-level managers. Reliance Retail IPO Plans Despite the valuation drop Reliance Retail is still targeting a $125 billion valuation for its IPO. The strategic restructuring is done to reassure investors of the business’s stability and potential for profitability in the face of macroeconomic challenges. Reliance Retail remains a major player in India’s retail businesses with a diverse presence spanning grocery fashion luxury and e-commerce. However analysts caution that the company’s ability to meet its ambitious IPO valuation will depend on the successful execution of its cost-cutting measures and the restoration of investor confidence. Industry experts note that Reliance’s recalibrated strategy signals a shift from aggressive expansion to a more measured focus on operational efficiency and profitability.