RIL Stocks: Shares of Reliance Industries are running at a discount of about 300 rupees from their all-time highs. This decline has come during the last 6 months. In such a time, it is the right time to invest in shares. Brokerage house Jefferies has raised the target to Rs 2600, recommending investment in Reliance Industries. In terms of the current price 2074, it can get 25 percent return in the next few months. The brokerage believes that there will be strong growth in Jio in the coming days. At the same time, the retail business of Reliance will also grow rapidly. The company will also get the benefit of its strong balance sheet.
Shares at a discount to record highs
Reliance Industries shares touched a level of Rs 2369 on September 16 last year, which is an all-time high. Shares got good support due to continuous investment in Jio. However, after that the stock showed pressure from record highs. In the last 6 months, the stock is currently trading at Rs 2074 with a discount of about Rs 300.
Shares can go up to Rs 2600
Brokerage house Jefferies has set a target of Rs 2600 for the stock, recommending investment in Reliance Industries. According to the brokerage house, 25% growth in RIL’s telecom arm Jio is possible during the financial years 2021 to 2023. At the same time, 43% growth in the retail business of Reliance can be seen during this period. Whereas B2C business can have 49 per cent share in EBITDA. While Reliance Industries’ balance sheet is strong, share sales in oil-to-chemical (O2C) can also be a big trigger.
Let us know that recently, Reliance Industries introduced the outline of the demerger plan for the oil-to-chemical business. Reliance Industries has plans to form a separate company for the oil-to-chemical business. The company hopes that by the second quarter of the next financial year, it will get the necessary approvals to move its oil-to-chemical business to a separate unit. This will include businesses such as petrochemical, gas, fuel retailing. Also, demerger will help to bring in investors like Saudi Aramco. The company said the demerger will help in finding new opportunities in the O2C business. The company will have 100 percent control of this new subsidiary.
How were RIL’s quarterly results
RIL’s revenue fell to 1.28 lakh crore in the third quarter of the current financial year, from 1.57 lakh crore a year ago. The revenue of refining and petrochemicals business fell to Rs 83,838 crore. Reliance Industries’ Qanso and standalone EBITDA declined by 5 per cent and 33 per cent year-on-year in the third quarter.
According to Jio’s expectations, Jio has grown at 45 per cent year-on-year. Jio’s revenue growth has been 6% higher on a quarterly basis. Reliance Jio’s ARPU grew at 4 per cent, which is weaker than expected. Retail business has weakened 9%.
