Reliance Industries Shares Jump 9% as Mukesh Ambani Outlines Future Roadmap

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Reliance Industries Shares Jump 9% as Mukesh Ambani Outlines Future Roadmap - YMP Hub News
Posted by: admin Category: News, Economic Tags: , , , , Comments: 0 Post Date: August 13, 2019

Reliance Industries Shares Jump 9% as Mukesh Ambani Outlines Future Roadmap

Reliance Industries Ltd (RIL) shares jumped as much as 9% in early trade on Tuesday, i.e. August 13, after chairman Mukesh Ambani made several important announcements, including Saudi Aramco’s investment in RIL’s oil-to-chemicals division, during the company’s 42nd annual general meeting (AGM) in Mumbai.

At 9.28am, the RIL stock was trading at Rs 1,260.70, up 8.5%, at BSE after hitting an intra-day high of Rs 1,270. Notably, as of Friday’s close, RIL shares had rallied 20% since the company held its previous AGM last year.

Mukesh Ambani on Monday announced that Saudi Aramco will invest 20% in RIL’s oil-to-chemicals division at an enterprise value of $75 billion. The deal would be amongst India’s largest foreign direct investment (FDI) till date, besides being the biggest foreign investment in the history of RIL. The partnership will cover all of RIL’s refining and petrochemicals assets, including 51% of the petroleum retail joint venture.

In another significant announcement, Mukesh Ambani also stated that RIL will become a net zero-debt company within the next 18 months. He said the deal with Aramaco, as well as the retail petroleum deal with BP, will be closed within this financial year. That would bring in Rs 1.15 lakh crore into RIL. These, along with other transactions to deleverage the group, would make the company a zero-net debt company in 18 months. As of FY19-end, RIL had a net debt of Rs 1.54 lakh crore.

The RIL AGM also gave a launch date to the much-awaited Jio GigaFiber services. Ambani said the Jio GigaFiber will be available commercially starting 5 September 2019. He outlined that service would be broad-ranging including a 1 Gbps network speed, free landline connection, digital set-top box, ultra-high-definition entertainment, virtual content, interactive gaming and more smart home solutions. Customers will have to pay between Rs 700 and Rs 10,000 per month depending on the plan. Users will be charged only for data and voice calls would be completely free from home to any Indian mobile or fixed-line operator.

Investor sentiment towards RIL shares must have also been lifted by the fact that listing of the company’s retail and telecom units was on the cards. Mukesh Ambani announced that RIL planned to list its telecom and retail ventures in the next five years. Reliance Jio and Reliance Retail, if listed separately, would be among the top 10 companies in the country, said Ambani. Reliance Jio has already crossed 340 million subscribers. Meanwhile, RIL’s retail arm has crossed Rs 130,000 crore in revenue last year.

Disclaimer: News18.com is part of Network18 Media & Investment Limited which is owned by Reliance Industries Limited.

News: news18.com

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