RIL: Gearing up for challenge

Share price of oil-to-telecom conglomerate Reliance Industries (RIL) has been on the rise since it revealed its plan to cut net debt to zero by March 2021 and stake sales in its digital arm Jio Platforms.
Today, RIL stock price hit an all-time high of Rs 1,908 on the BSE, up about 1.6% from Friday’s close, pushing its market capitalisation to Rs 12.09 trillion – a record for an Indian company.
Since mid-March, the stock has risen over 120%.

The company is scheduled to hold its annual general meeting this week.
On Sunday, Qualcomm Ventures, the investment arm of Qualcomm Inc., said it will invest Rs 730 crore for a 0.15% stake in Jio Platforms, becoming the 12th entity to invest in the digital services subsidiary of RIL in over three months.

With this, RIL has sold a total of 25.24% stake in Jio Platforms to Facebook, General Atlantic, TPG, KKR, Silver Lake, L Catterton, Vista Equity Partners, Abu Dhabi Investment Authority, Mubadala Investment Company, and Public Investment Fund (PIF), Intel Capital and Qualcomm Ventures, raising Rs 1,18,318.45 crore.
RIL also raised Rs 53,124 crore through a rights issue. Its net debt was at Rs 1.61 lakh crore as of 31 March. With these investment, it is now a net debt free company.

RIL’s asset monetisation details especially on telecom InvITs and Saudi Aramco stake sale; capital allocation and growth strategy post Covid-19; plans to leverage the partnerships with global technology peers and integrate its retail, digital and financials business; details on oil to chemicals integration and expansion of oil retail and new energy business with BP are expected to drive stock performance as investors look beyond FY21 Q1 challenges.

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