RIL turns debt-free before Mar-21 deadline

Billionaire Mukesh Ambani owned petrochemical to telecom giant Reliance Industries (RIL) has turned net debt free by raising Rs 168,818 crore in two months through the country’s largest ever rights issue and series of stake sale deals in its arm Jio Platforms, much ahead of its March 2021 deadline.

Had Mukesh Ambani promised RIL shareholders in August last year to make the company a zero debt. He achieved this feet by offering shares to existing shareholders worth Rs 53,124.20 crore and another Rs 115,693.95 crore through sale of stake in Jio Platforms through 11 deals.

On Thursday, RIL announced the eleventh investment in Jio Platforms as Saudi Arabia’s Public Investment Fund (PIF) bought 2.32% stake in Jio Platforms for Rs 11,367 crore.

PIF joins international investors like Abu Dhabi’s two largest sovereign investment arms — Abu Dhabi Investment Authority and Mubadala, private equity firms Silver Lake, Vista Equity Partners, General Atlantic, KKR, TPG, L Catterton. Social media major acquired the biggest share among investors by picking up 9.99% for nearly Rs 44,000 crore.All these investors together hold 24.70% stake in Jio Platforms now.

On Friday, RIL shares scaled a new high of Rs 1,685. It traded up 1.55% at Rs 1,681.85 on the BSE, outperforming the S&P BSE Sensex benchmark index.

Industry experts believe that the RIL-FB partnership could emerge as a core platform for India’s digital economy and as more consumers and small businesses move online, it could unlock a digital market worth $ 2 trillion.

The Reliance stock has been a major outperformer during this lockdown and corona virus outbreak having shot up fro Rs 875 levels on 23rd Mar 2020 to a high of Rs 1730 currently.

Going ahead with such a strong outperformance, the markets are closely waiting for this platform to deliver numbers ahead in the coming financial year. Already the debt reduction is expected to improve leverage on the balance sheet by which earnings should get a significant boost going ahead.

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