An investment worth Rs 1,000 made in Reliance Industries' Initial Public Offer (IPO) about 35 years ago is now worth Rs 7.78 lakh, its chief Mukesh Ambani said today, while promising further value creation for shareholders.
"Rs 1,000 invested at the time of IPO in Reliance in 1977-78 has grown to Rs 7.78 lakhs at a CAGR of 21.6% In this period our revenues have grown 27% year on year on a compounded basis," Ambani told RIL shareholders at the company's 38th AGM here today.
Mukesh Ambani, currently Chairman and Managing Director, has been on the RIL board continuously since it became public after its IPO in 1977.
"As we enter our thirty fifth year since our IPO, it is an appropriate moment to look back at our achievements. Reliance has a unique track record of organic growth and value creation since it became a public company," he said.
"For its large family of shareholders, we have created value by consistent profitable growth and continuous investment in business opportunities," he added.
Ambani further said that Reliance was currently going through a transformation process, which would create further value creation opportunities for all shareholders.
Since its IPO, RIL's revenues has grown 27% year on year on a compounded basis, while, the company's profits have grown 29% year on year on a compounded basis, Ambani said.
Reliance, then in the business of textiles manufacturing, had issued 2.8 million equity shares of Rs 10 each in its first equity sale to the public investors in November 1977.
Through this public offer, Reliance founder Dhirubhai Ambani is said to have introduced equity cult in India.
Currently, the Reliance Industries stock is trading at near Rs 730 level, although it has been under pressure in recent past and had hit a low of Rs 671 last month on May 6.
RIL has also lost its long-held status as the country's most valued company to Tata group firm TCS and in terms of weightage on the stock market's barometer index, the Sensex, RIL has been flip-flopping from the number one position in recent past.
At the end of yesterday's trade, RIL's market value stood at Rs 233,835.64 crore, as against TCS' Rs 245,288.72 crore.
The year 2011 was especially bad for RIL shares, as it fell by about one-third as against a fall of about 24% in the benchmark Sensex.
RIL's March quarter profit plunged by 21% to Rs 4,236 crore compared to Rs 5,376 crore a year ago.
However, RIL has declared the highest ever dividend payout of Rs 2,941 crore for 2011-12 and has announced the largest ever share buyback in India's corporate history by setting aside up to Rs 10,440 crore for this purpose.