RIL becomes first Indian firm to hit Rs 9 trn m-cap; stock up 27% in CY19

Reliance Industries (RIL), the oil-to-telecom behemoth, on Friday hit another milestone as the market capitalisation (m-cap) of the company breached the coveted Rs 9 trillion-mark, the first by any Indian company. 

The stock hit a high of Rs 1,428 during the session. At close, shares of the company stood at Rs 1,415.30 apiece on the BSE, up 1.37 per cent. The m-cap stood at Rs 8,97,179.47 crore.

The Mukesh Ambani-led company is slated to release its September quarter results later in the day where it is expected to report a strong quarter for the July-September period. Analysts expect refining to offset weakness in petrochemicals (petchem) and a lower tax rate benefit for the retail and telecom businesses.

In a Bloomberg poll, 10 analysts estimated RIL’s consolidated net profit at Rs 11,256 crore and nine analysts estimated revenue at Rs 1.5 trillion. Brokerages like Centrum see the highest-ever consolidated earnings prospect for the company. In the September 2018 quarter, RIL reported a consolidated net profit of Rs 9,516 crore. READ MORE

“We expect September quarter GRMs at $9.5 per barrel, up from $8.1 per barrel during the June quarter, on the back of higher key product margins of diesel, gasoline, and jet fuel. The attack on Saudi Aramco oil processing facilities pushed gasoline margins to its highest level since 2018,” said analysts with BNP Paribas in their note. Analysts expect refining strength to offset petchem weakness.

In its recent report, Bank of America Merrill Lynch (BofA-ML) said RIL can in the next 24 months become the first Indian company to achieve a market capitalisation of $200 billion.

That would come on the back of its new commerce venture and fixed broadband business, BofAML said. The brokerage said the key drivers necessary for Reliance to breach $200 billion m-cap in 24 months are new commerce initiative of empowering Kiranas in unorganised retail market by offering MPoS (mobile point-of-sale), entry into SME enterprise space with Microsoft, Jio's fiber broadband business and digital initiatives like advertising. CLICK TO READ FULL REPORT

At the bourses, shares of Reliance Industries (RIL) have outperformed the market by surging around 27 per cent in the calendar year 2019 (CY19) as against nearly 7 per cent rise in the Nifty50 index.