Reliance Industries hits record high; market-cap nears Rs 15 trillion mark

Shares of Reliance Industries (RIL) hit a record high of Rs 2,218, up 3 per cent on the BSE in the early morning trade on Thursday, with its market-capitalisation (market-cap) nearing Rs 15 trillion. It surpassed its previous high of Rs 2,198.70, touched on July 27, 2020 in intra-day trade.

The stock has gained 5 per cent in the past two trading days after Silver Lake on Wednesday agreed to invest Rs 7,500 crore ($1 billion) into Reliance Retail Ventures (RRVL). Reliance Retail, a subsidiary of RRVL, operates India's largest, fastest growing and most profitable retail business serving close to 640 million footfalls across its around 12,000 stores nationwide.

The combined market-cap of RIL’s fully paid shares and partly paid shares nears Rs 15 trillion mark. At the time of writing of this report at 10:00 am, the fully paid RIL’s shares were trading 2.6 percent higher at Rs 2,217 per share with a market cap of Rs 14.04 trillion.

The partly paid (PP) shares of the company traded at Rs 1,324, higher by 4.4 per cent, after hitting a high of Rs 1,324 in intra-day trade on the BSE. The market cap of PP shares was at Rs 55,882 crore, taking the combined market cap to Rs 14.61 trillion. RIL market-cap is less than 3 per cent away to touch the Rs 15 trillion mark.

On July 27, 2020, the combined market-cap of RIL touched Rs 14.51 trillion in the intra-day trade.

According to a Bloomberg report, KKR & Co. is in advanced talks to invest at least $1 billion in the retail business of RIL. "KKR is in discussions for a stake in RRVL, a unit of the largest retailer in India, said the people, who asked not to be identified because the information isn’t public. The private equity firm could invest as much as $1.5 billion and an announcement could come as soon as this month," Bloomberg reported.

“Recent media reports also indicate Reliance Retail may offer stake to investors in Jio Platform (telecom). Reliance Retail also recently announced acquisition of Future Group. While these developments may raise concern, we believe there is enough growth headroom for peers given the retail opportunity,” analysts at Jefferies said in a stock update.

Analysts at KRChoksey Shares and Securities reiterate a “BUY” rating on the shares of RIL with a target price of Rs 2,394 per share. Like Jio platforms, Reliance Retail is also scouting for global strategic investors for partnership. Post the Reliance-Future deal, the entity becomes India’s leading retailer with presence in different retail formats and with a robust back-end infrastructure. This will facilitate to bring in global investors to unlock value for the Reliance shareholders, the brokerage firm said.