Both groups deliver handsome shareholder returns

Written by Markets Bureau | Mumbai, Jun 17 | Updated: Jun 18 2008, 05:32am hrs
After three years of the announcement of the split of Indias most valuable private company, Reliance Industries Ltd (RIL) and the demerged entities from the parent continue to seek the same attention from investor community. The returns fetched by these companies have added significantly to the investor wealth.

Of the companies belonging to Mukesh Ambani, RIL has posted a phenomenal return of 235%, or Rs 1,635 per share, from Rs 693.85 to Rs 2,329. Reliance Industrial Infrastructure Ltd (RIIL) gave a return of 213%, or Rs 692 per share, from Rs 323 to Rs 1016. Reliance Petroleum has fetched a return of Rs 100, or 117%, from Rs 85.45 to Rs 185.9.

Arun Kejriwal, CEO of KRIS, said, The unlocking of value post-split has been in favour of the investors. The shareholders of RIL have direct exposure to various businesses such as Reliance Communications, Reliance Energy Ventures, Reliance Capital Ventures and RNRL. There has been a substantial upside to the wealth of the shareholders post-demerger.

Anil Dhirubhai Ambani Group (ADAG) companies also fetched significant returns to the investors. The stock price of Reliance Capital, the financial services company of the group, has appreciated in this period from Rs 437 to Rs 1,166.55, posting a return of 166%, or Rs 729.55. Also Reliance Infrastructure Ltd, formerly Reliance Energy Ltd, has surged from Rs 599 to Rs 1,104.65, giving a return of 84%, or Rs 504.75. The recent entrant in the ADAG pack, Reliance Power, is the only company which has posted negative returns of Rs 181 or 48.72%, trading from Rs 372 to Rs 191. Reliance Communications Ltd has surged from Rs 290 to Rs 530, posting a return of Rs 239 or 82% while Reliance Natural Resources Ltd (RNRL) went up by Rs 75, or 405%, from Rs 18.55 to Rs 93.75.

The Bombay Stock Exchange (BSE) and the National Stock Exchange held a special one-hour trading session on January 18, 2006 to facilitate price discovery post-demerger of RIL's energy, and communication businesses. The special one-hour session was conducted on both the bourses before the commencement of regular trading session on the day without applying circuit-filter.