Shares of Reliance Industries (RIL) were up 1.58% to Rs 1430.45 as the company's rights issue opens today, 20 May 2020.The rights issue valued at Rs 53,125 crore, will be open for subscription today and it will close on 3 June. All eligible shareholders as per record date of 14 May are entitled to subscribe to the fresh issue.
RIL will issue 42,26,26,894 equity shares as part of the rights issue. The company will offer existing shareholders one new share for 15 held at a discounted price of Rs 1,257.
The promoter and promoter group of the company have confirmed they will subscribe to the full extent of their aggregate rights entitlement. In addition, they will also subscribe to all the unsubscribed shares in the issue.
Shareholders will only have to pay 25% of the total subscription amount and the balance will have to be paid by shareholders in two installments in May 2021 and November 2021 respectively, as per the company's filing.
Mukesh Ambani had in August last year unveiled plans to cut debt to zero by 2021. As part of this plan, RIL has been seeking strategic partnerships across its businesses while targeting to deleverage the balance sheet.
At the end of March quarter, RIL had an outstanding debt of Rs 3,36,294 crore. It also had cash in hand of Rs 1,75,259 crore, bringing the net debt position to Rs 1,61,035 crore.
As part of its balance sheet deleveraging plans, RIL has sold minority stake in its digital unit, Jio Platforms to likes of Facebook.
On a consolidated basis, the company's net profit fell 38.74% to Rs 6,348 crore on 2.5% decline in revenue to Rs 151,209 crore in Q4 March 2020 over Q4 March 2019.
Reliance Industries is India's largest private sector company. RIL's activities span hydrocarbon exploration and production, petroleum refining and marketing, telecom and digital services.
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