Reliance Retail has initiated a furious expansion drive with special emphasis on the wholesale cash-and-carry segment to take the battle to multinationals such as Walmart and Carrefour that have to build up their retail presence from scratch.

“Reliance Retail plans to take the battle straight to multinational chains operating in the wholesale cash-and-carry segment and choke them in that area with all its might,” a person who is aware of the company’s plans said.

The government last week issued some clarifications on the multi-brand retail FDI policy including foreign retailers’ inability to acquire existing retail businesses and to make upfront and fresh investment of at least $50 million in back-end infrastructure, which will keep global supermarket titans from going the whole hog in India at least in the immediate future and restrict them to the cash-and-carry business where they are already present.

“Reliance is not keen to allow any foreign company to take the pole position even in the wholesale business that generates mega bucks for the same effort. So, the wholesale business is now top priority,” the person said.

A senior executive of a foreign cash-and-carry company said, “The hearsay is they (Reliance) want to become the number one player in wholesale by the end of the year.”

A Reliance spokesperson did not reply to a detailed e-mail sent on Wednesday.

A former top executive of the company said the retail arm of Mukesh Ambani-led Reliance IndustriesBSE 0.00 % is expanding aggressively across formats in a bid to become India’s Walmart. It has told its employees to “drive revenues at all costs”, the person said.

With around 10,800 crore in annual sales Reliance Retail is only about Rs 2,000 crore shy of the country’s largest retail enterprise Future Retail.

Reliance will use its deep pocket and its reach in almost every format in almost all the geographies to drive up revenues without bothering about short-term profitability, the former executive said. “They are not doing this business for now, they are looking at the next 10 years horizon. In that sense, they are headed towards becoming India’s Walmart.”

Besides cash and carry, Reliance is also focusing on its jewellery chain Reliance Jewels, which is also capable of generating high top-line growth.

The company recently shifted Reliance Jewels headquarters from Bangalore to Mumbai under a new head, Sunil Nayak, who has been roped in from Landmark in Dubai. He spent a year in Reliance Retail’s corporate office before being appointed as Reliance Jewels head.

Nayak’s brief would be to corner a sizeable portion of the Rs 1,70,000-crore annual jewellery market in India where Kerala-based Kalyan Jewellers and Malabar Gold are leaders with 40 odd stores each. At the moment, Reliance Jewels’ revenue is only Rs 800 crore.

Cash-and-carry business, too, is expected to grow into a huge opportunity. Industry experts estimate cash-and-carry in India to be a $22-billion (approx Rs 1.2 lakh crore) annual opportunity by 2017 and the market leader in the sphere is expected to corner a business of about $4-5 billion in annual revenue.

“Walmart makes about Rs 2,000 crore annually from its 20 odd stores. So, it’s a good business to be in,” a person aware of the developments at Reliance said.

Walmart, which forayed into the wholesale retailing in 2009, had revenues of Rs 1,876 crore for the year ended December 2011.

The US retailer has said that it would continue to invest in the format even after India allowed global supermarket operators to directly sell to Indian consumers.

Walmart Stores Inc currently operates 20 cash-and-carry stores in the country, while Germany’s Metro AG has 15 such outlets and four each of France’s Carrefour SA and Britain’s Booker Group Plc.

Reliance Retail, which operates cash-and-carry operations through Reliance Market chain, plans to open 15 such stores between April and September. Five-six of them have already been opened, the person quoted earlier said.

To execute its ambitious plans, Reliance has roped in Randy Guttery, a former managing director for Metro in Vietnam, to spearhead its wholesale venture.