Reliance becomes first company to cross Rs 21 trillion m-cap mount

The RIL counter has been seeing renewed interest after almost two dozen brokerages gave a buy call earlier this month.
Reliance Industries owner Mukesh Ambani.
Reliance Industries owner Mukesh Ambani.(File Photo | PTI)

MUMBAI: The billionaire Mukesh Ambani-run Reliance Industries has become the first company to cross the Rs 21-trillion market capitalization mark boosted by the tariff hike announced by its unlisted telecom arm Jio Infocomm and also the overall bullish market that has seen the indices setting new records this week, barring today.

At the end of the trade on Friday, Reliance, which for decades has been the most valuable company, closed at a market cap of Rs 2,119,009.71 crore or Rs 21.19 trillion. The stock rallied to 52-week high of Rs 3,161.45 when the market was also at new peak but closed a tad lower at Rs 3,131.85 or 2.31 percent over the previous close on the BSE.

The RIL counter has been seeing renewed interest after almost two dozen brokerages gave a buy call earlier this month. Most of them have a price target to Rs 3,380 - 3,580. Overseas brokerage Jefferies has a price target of Rs 3,580 over its previous call for Rs 3,380, indicating a 17 percent upside from Thursday's close.

Today’s 2.3 percent rally was primarily driven by Jio announced new unlimited plans effective July 3 along with a 17-27 percent hike in tariffs which will improve its already industry leading average revenue per user and this the bottom-line. The new tariffs range from Rs 189 for 2 GB/month to Rs 3,599 for a 2.5 GB/day annual plan, with unlimited 5G data for plans of 2 GB/day and above. According to analysts, a 20 percent tariff hike can boost bottom line by 10-15 percent.

So far this year, the Reliance counter has surged over 20 percent, while the indices have rallied half of that.  This has the RIL becoming the first domestic company to reach the Rs 21-trillion m-cap milestone.

On June 28, Jefferies raised Reliance's price target to Rs 3,580 from Rs 3,380, indicating a 17 percent upside from Thursday's close, the highest target on the street. The brokerage maintained a 'Buy' rating, estimating Jio's revenue and profit to grow at an annual pace of 18 percent and 26 percent, respectively, from FY24 to FY27.

Morgan Stanley is overweight on RIL with a target of Rs 3,046, as the brokerage expects new energy cashflow streams by year-end. As many as 28 of the 35 analysts covering Reliance have a buy call, five have a hold call and only two have sell call on the counter.

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