RIL fixes May 14 as record date for rights issue. Should you subscribe?

Most brokerages expect the company to do well over the coming quarters and peg the target price for the stock higher than its current market price. Subscribing to the issue makes sense, they say

Mukesh Ambani-controlled Reliance Industries Limited (RIL) has fixed May 14 as the record date for the Rs 53,100 crore 1:15 rights issue, which is priced at Rs 1,257 per share.

Simply put if you own the stock as on May 14, you will be eligible to particpate in the rights issue. For every 15 shares held, the company will offer 1 share.

"Promoters would subscribe their full entitlement of rights issue and also all the unsubscribed portion. This highlights a sense of confidence on the part of promoters