Reliance Retail to Turn Profit by FY2028 as It Expands Dark‑Store Network

In a bustling Mumbai warehouse, workers load pallets of groceries onto vans destined for the city’s growing number of “dark stores” – retail locations dedicated to online orders. The scene illustrates Reliance Retail Ventures Ltd’s (RRVL) latest push to scale its quick‑commerce operations while tightening unit economics.

Chief Financial Officer Dinesh Taluja told investors on Friday that the retailer is investing in dark‑store infrastructure, faster delivery and better availability to drive profitability from the next financial year. He said the company will focus on “balanced unit economics” and will shut down large‑footprint stores that do not meet performance targets.

Reliance Retail added 303 new outlets to its sales network in the quarter but closed 222 under‑performing stores, reflecting a “ruthless focus” on profit rather than sheer store count. The firm reported a 42% rise in online grocery revenue for Q2 of FY27, attributing the growth to a “scale‑up of hyperlocal” services and a larger share of revenue from online channels.

Unlike pure‑play e‑commerce rivals that are building standalone logistics, Reliance can tap its existing footprint of more than 5,000 stores in over 1,000 cities. Taluja said this omnichannel reach gives the company an edge, especially in smaller cities where competition is limited and incremental costs are lower.

“We are growing pretty rapidly in the smaller cities as well. There is no competition… Their consumer demand is there, and for us, the incremental costs are much lower,” he added. The firm expects the expanded dark‑store network and improved supply‑chain capabilities to start contributing positively to earnings by FY28.

Analysts note that the disciplined expansion could set a new benchmark for profitability in India’s crowded online grocery market, where many players chase order volume at the expense of margins.

Why it matters: Reliance Retail’s strategy to leverage its vast physical network for online grocery delivery could reshape the Indian e‑commerce landscape, offering consumers faster service and potentially lowering prices, while signaling a shift toward sustainable growth for the country’s largest retailer.