MUMBAI: Indian conglomerate Reliance denied a report Thursday that it was planning to sell a $20-billion stake in its retail business to US rival Amazon in a deal that could upend the country's hugely lucrative e-commerce sector.

The report published by Bloomberg on Thursday said that Reliance, owned by Asia's richest man Mukesh Ambani, had offered Amazon a 40-percent stake in its retail subsidiary RRVL, citing an unidentified person with knowledge of the matter.

The deal, which would have been the largest for India and for the Silicon Valley behemoth according to Bloomberg data, would have shaken up the South Asian nation's retail sector, transforming the relationship between two firms that have spent months locked in frenzied competition.

But a source at the Indian oil-to-telecoms giant disputed the report, which sent Reliance shares up by more than seven percent in Mumbai, calling it "incorrect".