Mukesh Ambani-led Reliance Industries (RIL) shares witnessed a strong rally this week with stock price rising 5.2% in the past four sessions amid a slew of positive developments. In comparision, the BSE benchmark Sensex gained 2% during this period.
Extending its gaining streak for the fourth straight session, the Reliance share price opened higher on Friday and rose much as 1% to hit its new all-time high of ₹2,855 on the BSE. The stock, which has been consistently touching fresh highs, breached a new peak of ₹2,850 attained in the previous session.
Driven by strong rally in share price, the market capitalisation of the country’s most valued firm hit ₹19 lakh crore levels for the first time earlier this week. With this, RIL became the first Indian listed company to cross the ₹19 lakh crore market capitalisation-mark. Currently, the m-cap of the oil-to-telecom behemoth stands at ₹19.19 crore.
Boosted by the stellar gain in the RIL share price, company’s chairman Mukesh Ambani also saw a rise in his net worth rising by $1.41 billion. Asia’s second-richest person, after Adani Group’s Gautam Adani, has a net worth of $104 billion as of April 29, as per Bloomberg Billionaire Index. Ambani ranks at 8th on the billionaire index, while Gautam Adani stood on 5th position with a net asset of $124 billion.
The recent rise in Reliance shares can be attributed to a slew of major agreements signed by the company this week. The company in an exchange filing on Thursday said that Bodhi Tree Systems, a platform set up by media baron James Murdoch and former Disney India executive Uday Shankar, has signed a deal to invest ₹13,500 crore in its entertainment business, Viacom18. On Wednesday, RIL and Abu Dhabi Chemicals Derivatives Company RSC (TA’ZIZ) signed a pact for a $2 billion chemical joint venture in the United Arab Emirates (UAE).
Last week, Reliance Brands, a subsidiary of Reliance Retail Ventures, acquired a 51% majority stake in couturiers Abu Jani Sandeep Khosla (AJSK) for an undisclosed amount. The strategic partnership is aimed at accelerating the 35-year-old couture house’s growth plans in India and across the globe.
The bullish outlook on the Reliance shares also boosted demand for the stock. Recently, global brokerage Morgan Stanley raised its target price on the Reliance stock from ₹2,926 apiece to ₹3,253 per share, an upside of almost 20%, with an overweight rating. "We estimate tightness in the gas and fuel refining markets will fund nearly half of RIL's new energy capex over the next three years as refining margins and gas prices stay above mid-cycle levels," it said in its report.
It stated, “We expect up to a 10% boost to RIL's NAV in anticipation of quicker hydrogen monetisation – quite similar to its digital and retail NAVs over the past decade, which were discounted 3-4 years ahead of their actual earnings contribution.”
"We also estimate hydrogen can achieve a 14-15% ROCE for RIL on a through-cycle basis – on par with its highly profitable oil-to-chemicals operation. As the green hydrogen ecosystem is rolled out, it will also raise demand for RIL's solar panel," it added.