Shares of Reliance Industries (RIL) soared 3.76% on Friday, hitting their 9-1/2 years’ high to close the session at Rs 1,586.20 on the Bombay Stock Exchange (BSE). At the National Stock Exchange (NSE), they rose by 3.60% to close at Rs 1,584. The RIL market cap increased by Rs 18,697.5 crore from 4.97 lakh crore, according to Bloomberg data. A total of 19.75 lakh shares were traded at the counters while the average three-month volume has been 3.92 lakh. The stock gained following announcement of issue of bonus shares in the ratio of 1:1 to the common shareholders of the company after a gap of eight years. The last bonus issue was in 2009 in the ratio of 1:1. The announcement was made by RIL’s chairman Mukesh Ambani at the company’s 40thAnnual General Meeting post board meeting in Mumbai on Friday.
Mukesh Ambani also announced the launch of ‘Jio Phone’, a phone with 4G-enabled features. The RIL chairman said. “Jio will give them access to unlimited data on the Jio Phone. If these feature phone users were to consume a similar quantity of data on other operator’s network, they would spend over Rs 4,000 – 5,000 per month at prevailing 2G data rates.” In addition, Reliance on Thursday announced its financial performance for the quarter ended June 30, 2017. Reliance’s consolidated net profit rose 28% to Rs 9,108 crore in the June quarter, boosted by robust performance by its core businesses – refining margins soared to a nine-year high of $11.9 per barrel, while profitability of the petrochemicals business rose to a record.
“Market was enthused today by Jio’s rapid expansion and innovative plan. Rivals failed to find their bandwidth,” said Vinod Nair, head of research, Geojit Financial Services. Reliance on July 17 became the second Indian company to cross Rs 5 lakh-crore market capitalisation after Tata Consultancy Services (TCS). “We continue to remain positive on Reliance Industries from a long-term perspective. The company’s core business is expected to continue seeing improvement in profitability as GRMs remain healthy, given the direction of global crude prices,” said Nitasha Shankar, senior VP and head of research, Yes Securities. Of the 39 analysts tracking RIL stock, 61.5% have a ‘buy’ rating, 33.3% have a ‘hold’ rating and the rest have ‘sell’ rating, showed Bloomberg data.