Shares of billionaire Mukesh Ambani controlled Reliance Industries surged to a fresh record high on Thursday, taking the firm just a whisker away from another milestone.
Shares of billionaire Mukesh Ambani controlled Reliance Industries surged to a fresh record high on Thursday, taking the firm just a whisker away from another milestone. Reliance Industries share price jumped by more than 2.2% intra-day to hit a new record of Rs 1,413.75. As at the end of the day’s trade the firm’s market capitalisation has swollen to Rs 8,90,657.84 crore, data from BSE showed. At this level, Reliance Industries remains India’s most valued firm by mcap. Tata Group’s IT behemoth TCS comes at a distant second with its market capitalisation at Rs 8.30 lakh crore.
Taking stock of RIL’s record rally, Manish Yadav, Head of Research at Capital Aim said that the surge can be attributed to the firm’s increased focus on retail business. “Addition of stores will enhance brand visibility and can dramatically improve the volume of business in the short term,” Yadav said. According to the expert, Reliance Industries could continue its upward move and lead the market, provided that the general election results do not upset the current market expectations. However, at current levels, the stock remains expensive, he reckons. He suggests investors to enter into the stock at below Rs 1,200 levels.
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In the Jan-Mar period, the oil-telecom conglomerate reported a drop in standalone net profit for the first time in 17 quarters. Notably, Reliance Industries net profit came in 9.79% higher on-year to Rs 10,362 crore, making it the only firm so far to report above Rs 10,000 crore profit in two consecutive quarters. For the full fiscal year, the firm reported a 13.1% jump in net profit to Rs 39,588 crore. The behemoth’s gross refining margin (GRM) — a key metric of its profitability from turning crude oil into petroleum products — slumped slightly in the quarter to $8.2 per barrel from $8.8 per barrel in the previous quarter.
According to Morgan Stanley, the Q4 results came in 7% higher than its initial estimate, but with a slight miss on EBITDA. The refining margin is has improved slightly, but telecom ARPU is lower than expected, the firm added. Morgan Stanley has an overweight rating on the stock with a target price of Rs 1,230.