Nine of the top-10 most valued Indian firms added a collective Rs 2,89,699.42 crore in market valuation last week, led by Reliance Industries. The surge follows a strong rally in the Indian equity markets, with the BSE Sensex gaining over 2% last week and 7.14% in June. The Sensex even breached the 79,000 mark on Thursday.
Mukesh Ambani, India’s richest man, saw his wealth increase by a staggering Rs 80,359.48 crore after Reliance Industries shares jumped 4% on Wednesday. This surge comes just days before his son, Anant Ambani, is set to marry Radhika Merchant on July 12th. The company’s market valuation also climbed significantly, contributing to a positive day for the Indian stock market.
Today’s news is dominated by major developments in the business and political spheres. LTIMindtree Chairman A M Naik has stepped down, Reliance Industries shares reclaimed the ₹ 3,000 mark, and Om Birla has been elected as the Lok Sabha Speaker for a second term.
Anil Ambani’s Reliance Power has made a remarkable turnaround, becoming debt-free on a standalone basis. After settling debts with banks such as ICICI, Axis, and DBS, the company has erased its financial burden of approximately Rs 800 crore. This has boosted the company’s shares, which were trading at a low of Rs 1.13 in 2020 and have now rebounded to over Rs 26.15. With an equity base of Rs 4016 crore and an operating capacity of 5900 MW, Reliance Power is once again attracting the attention of investors.
Mukesh Ambani, the chairperson of India’s most valuable company Reliance Industries, is planning to establish a global economic hub in Navi Mumbai. For this purpose, Reliance Industries has leased a massive 3,750 acres of land for 43 years in Navi Mumbai for a whopping Rs 13,400 crore. The land will be used to develop an integrated industrial area with global partnerships, similar to Reliance’s existing industrial complexes in Jamnagar, Hazira, and Dahej. Reliance Industries began the sub-lease of the land in 2019 with an initial payment of Rs 2,180 crore.
Indian stock markets experienced mixed signals on Monday, with the Nifty 50 and Sensex reaching new highs before profit booking pulled them back. Mukesh Ambani’s venture into Africa’s telecom market, plans for monsoon arrival, a slowdown in India’s economic growth, and foreign portfolio investor selling were among the notable news items.
Jio Financial Services, the financial arm of Reliance Industries, has been experiencing a consistent upward trend, reaching record highs. Factors contributing to this growth include strong financial performance, the establishment of a joint venture with BlackRock, and the company’s inclusion in the Nifty Next 50 index. Reliance Strategic Investments Limited, which was demerged and rebranded as Jio Financial Services, made its stock market debut in August 2023, with a slight premium over the discovered price.
Seven companies, including Reliance Industries, have submitted bids for government incentives to establish battery manufacturing facilities with a capacity of 10 GWh. The bids were received in response to a global tender issued by the Heavy Industries Ministry for a total capacity of 70 GWh. The ministry noted the strong industry response, with bids seven times the targeted manufacturing capacity.
Reliance Industries Ltd.’s (RIL) shares experienced a decline of over 1% on Tuesday, despite a slight uptick in the Nifty 50 index. The company’s performance in the fourth quarter of FY24 (Q4FY24) lacked significant catalysts for the stock. Notably, growth in RIL’s retail business, a key factor in the company’s valuation, has moderated. Gross retail revenues declined sequentially in Q4 following a festive season surge in Q3. However, year-on-year, the segment exhibited an 18% increase in Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA). Concerns regarding retail valuations, exemplified by the performance of Avenue Supermarts Ltd., highlight the need for growth to exceed expectations or for premium valuations to persist beyond five years to generate meaningful returns. In contrast, RIL’s telecom subsidiary, Jio, is being valued in line with Bharti Airtel Ltd. and possesses strong potential for generating free cash flow. The company’s oil-to-chemicals (O2C) segment, including refining and petrochemicals, has maintained consistent feedstock throughput, generating substantial EBITDA. RIL’s primary catalysts for stock growth are expected to be its consumer-facing businesses as the new energy business continues to develop.
Reliance Industries (RIL) released its fourth-quarter results, showing a 10.8% year-over-year increase in gross revenue to ₹2,64,834 crore, while profit after tax (PAT) remained almost flat at ₹21,243 crore. Performances were positive across the board, including in oil and gas, retail, and telecom.
Brokerages have reacted positively to the results, with many maintaining their positive ratings and raising RIL’s stock target prices. Here are the recommendations from some key brokerages:
– Motilal Oswal Financial Services: Retain buy rating with a target price of ₹3245.
– Morgan Stanley: Overweight call with a target price of ₹3,046.
– Nuvama Wealth Management: Raised target price by 10% to ₹3,500, with a ‘buy’ recommendation.
– Kotak Institutional Equities: ‘Add’ call with a revised fair value of ₹3,200.
– Emkay Global Financial Services: Retains ‘add’ call with a target price of ₹3,200.
