Reliance Industries shares jumped ahead of a joint address later today by company chairman Mukesh Ambani and BP Plc’s group chief executive Bob Dudley.
Reliance Industries shares jumped ahead of a joint address later today by company chairman Mukesh Ambani and BP Plc’s group chief executive Bob Dudley. Reliance shares were trading up 2.2% at Rs 1,386 after rising to the day’s high of Rs 1,394.25. The subject of the address scheduled for 5.30 pm today is not immediately known. Meanwhile, the benchmark BSE Sensex was down 0.26% at 31,076.24 points.
Earlier April, PTI had reported that Reliance Industries and BP Plc may buy out their partner Niko Resources’ 10% equity stake in a gas field in Bay of Bengal. Niko Resources, which is struggling due to shortage of cash, is looking to sell the 10% stake it holds in the NEC-25 block, which is estimated to have 1.03 trillion cubic feet of recoverable gas reserves. Reliance Industries is the operator of the block, with 60% stake in it, while BP holds the remaining 30%.
Cash-strapped Niko Resources has also reportedly put up its 10% equity stake in Reliance Industries’ flagship gas producing field, KG-D6 block, which is estimated to have total proven reserves at 2.65 trillion cubic feet of natural gas. However, the production at this field in the Krishna Godavari basin has been on a decline due to natural aging of the block. Niko Resources is yet to find a buyer for its stake in the field.
Reliance Industries’ shares are on a sustained rise and have surged over 28% so far this year on prospects of fresh incomes from its petrochemicals and refining business’ under-commissioning facilities, and cash flows from its telecom business, which had seen heavy investments so far.
Global brokerage CLSA recently raised the target price on Reliance Industries’ shares to Rs 1,500 from Rs 1,350 and maintained its ‘buy’ rating on the stock, citing optimistic commentary by the company management on its telecom venture Reliance Jio, while also raising the valuation multiple on the refining business.
A little far back, late last year, news reports said that BP Plc may enter into a joint venture with Reliance Industries for launching a fuel retailing business in India. The British firm has an in-principle approval to open 3,500 fuel stations across the country. On the other hand, Reliance Industries has about 1,200 petrol and diesel retail pumps.