Shares of India's second most valued firm Reliance Industries rose on Wednesday after Chairman Mukesh Ambani picked up additional stake in the firm.
Shares of India’s second most valued firm Reliance Industries rose on Wednesday after Chairman Mukesh Ambani picked up additional stake in the firm. Reliance Industries share price gained more than 1.7% to hit the day’s high at Rs 1,217 on BSE. Mukesh Ambani’s stake has now increased to 48.87% after Reliance Services and Holdings Ltd, a private firm of Ambani, acquired more than 17.18 crore equity shares or 2.71% stake on September 13, 2019, pursuant to a scheme of arrangement, as per an exchange filing. As at the end of April-June quarter, the promoter and its entities held 47.29% stake in Reliance Industries, according to data available with BSE.
The development comes after Reliance Industries had announced a composite scheme of amalgamation by merging Reliance Holding USA into Reliance Energy Generation and Distribution and the latter with the company itself in June this year. Earlier this month, after Reliance Jio announced the much awaited commercial roll-out of Jio GigaFiber, global firm CLSA noted that it may have limited impact on Bharti Airtel’s estimates. Analysts say that Bharti Airtel’s offerings can effectively counter Jio’s disruptive plans.
Jio’s latest offerings include FTTH high-speed broadband up to 1Gbps, live TV, online gaming, group video calls, and more will be available to Jio Fiber customers across 1600 cities in India. Taking stock of the development, CLSA said that while the TV smartification will adversely impact broadcasters, the new plans will not impact Bharti Airtel’s offerings. Interestingly, Reliance Jio has announced that the annual subscriptions for Jio Fiber Gold, Diamond, Platinum, and Titanium packs will entitle the customers for a free 4K TV set.
Taking stock of Reliance’s pricing strategy, global brokerage firm Credit Suisse has said that Jio’s entry level broadband pricing is competitive. Credit Suisse has maintained a nuetral rating on the shares with a target price of Rs 1,210. Credit Suisse estimates that braodband services will contribute $1.2 billion EBITDA to consolidated operations if it achieves the 20 million user target.