What's interesting about the announcement, however, is the timing.
The last time India's most-valuable company gave one free share for each held was in October 2009, when it was embroiled in a bitter legal battle over the sale of natural gas to Mukesh's then-estranged younger brother Anil Ambani's power plant. Back then, Reliance wanted to shore up investor confidence ahead of final hearings before the Indian Supreme Court.
The answer in one word: data. The refining and petrochemicals group is changing its stripes with an audacious and expensive bet on data, which Mukesh Ambani says is "the new oil." Most of his speech at the shareholders' meeting was about Jio, the $30 billion fourth-generation mobile network.
Launched as a free service in September last year, Jio already has more than 100 million paying customers. But now comes the big gamble: free handsets to lure across the 500 million Indians who use cheap feature phones. To that, add a heavily discounted 153-rupee-a-month ($2.40) data plan, and an Apple-TV type of device to watch video on television sets, and it becomes clear Ambani is trying to reposition Reliance at the intersection of telecom and media.
Reliance Industries shares, YTD
In many ways, Ambani is borrowing from his own playbook. In July 2003, a year after the death of his father and Reliance founder Dhirubhai Ambani, he started giving away expensive LG and Samsung phones at 501 rupees -- less than $11 at the time -- to wean customers off rival GSM networks and lure them to his platform, which used Qualcomm Inc.'s code division multiple access, or CDMA, technology.
JioPhones, to be locally manufactured by third-party suppliers, will be effectively free, but to avoid misuse (of which there was a lot in 2003), Jio will collect a refundable 1,500 rupee deposit for three years. Assuming half of the country's 500 million feature-phone users switch, Jio collects $6 billion interest-free for three years.
That's where content comes in. Just this week, Reliance agreed to buy 25 percent of Balaji Telefilms Ltd., a TV and film production company. Reliance already owns Network 18, which has a joint venture with Viacom Inc., and runs CNBC and CNN-affiliated channels in India.
Shares of Jio's rivals -- in both telecom and TV distribution -- fell in Mumbai as Ambani unveiled his plan. However carriage is only the entry point. As Gadfly has argued, the real prize lies in mobile content -- digital music, education, Bollywood, talk shows and even politicians' speeches. (Prime Minister Narendra Modi's app may come pre-loaded on JioPhones.)
All this, of course, is for the long haul. To make sure shareholders remain on board with this telecom, media and content triple play, there's the 1:1 bonus.
This column does not necessarily reflect the opinion of Bloomberg LP and its owners.
Andy Mukherjee is a Bloomberg Gadfly columnist covering industrial companies and financial services. He previously was a columnist for Reuters Breakingviews. He has also worked for the Straits Times, ET NOW and Bloomberg News.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)