Reliance Industries Ltd hit yet another milestone today with it becoming the first company ever in India to touch a market capitalisation of Rs 6 lakh crore. Reliance Industries Ltd’s shares hit an all-new lifetime high on Tuesday in the opening trade at Rs 947.7 on the National Stock Exchange, taking the Mukesh Ambani-controlled company’s market value to above Rs 6 lakh crore for the first time ever. However, RIL’s shares fell soon after, giving up the morning gains to slip into red, and were trading at Rs 937.2 on NSE, down 0.27% from the previous close. On BSE, RIL shares were down 0.12% at Rs 937. (Track RIL’s live stock price)
Earlier yesterday too, the stock of RIL hit its previous all-time high, rising by 3.64% to Rs 943.45 before closing up 3.05% at Rs 938.1 on BSE. In the intraday trade, its market capitalisation topped Rs 5.97 lakh crore on BSE on Monday. Shares of RIL have gained in the last two trading sessions after it seems that the company has pricing power and it is expected that a recent hike in mobile tariffs will lead to better numbers in the upcoming quarters.
RIL shares have jumped over 55% so far in the current year 2017. The company had hit a market cap of Rs 5 lakh crore just three months ago, July this year. Earlier this month, Reliance Industries its fiscal second-quarter net profit rose 12.5% to Rs 8,109 crore, just about meeting the expectations despite a Rs 271 crore loss on its telecom venture Jio, on the back of healthy refining and petrochemicals margins.
Reliance Industries’ shares are on a sustained rise on the 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 till early this year. Analysts feel that the last 8-9 years of the capital expenditure cycle for the company on its petrochemicals and refining businesses has come to an end now, and will going forward yield huge cash flows.
Earlier this year, Reliance Industries Chairman and Managing Director Mukesh Ambani had said at the company’s AGM that the Rs 3.3 lakh crore capital expenditure cycle was coming to an end, and would start generating free cash flows in the coming months. Out of this Rs 3.3 lakh crores, Rs 1.3 lakh crore was earmarked for Petrochemicals segment. Reliance Industries expects 65% of its capital expenditure investments to start returning cash flows in FY18.
As for the telecom business, RIL shares saw a massive jump in late February on the prospects of fresh cash flows from Jio, when Mukesh Ambani announced that Reliance Jio has acquired over a 100 million subscribers in just less than six months of the launch of services, and said that the company would start paid services in April. Shares saw another spurt in late March as the date of the start of paid services on Jio network drew closer. The company’s shares have been on an upmove since then.