RIL shares hit a new high with a market capitalization of Rs 19.2 lakh crore

RIL shares hit a new high with a market capitalization of Rs 19.2 lakh crore

RIL shares hit a new high with a market capitalization of Rs 19.2 lakh crore

Following Bloomberg's news that Walt Disney's India branch might have its value cut in half as a result of its planned merger with Mukesh Ambani's media company, RIL shares increased.

Following favorable remarks on peak capital expenditure and robust retail performance, RIL's shares has increased throughout January.

For the third straight day, Reliance Industries Limited's shares increased by 5%, bringing the company's market valuation to Rs 19.2 lakh billion.

The stock peaked on January 29 at 12:50 p.m., at Rs 2,850.

Following Bloomberg's news that Walt Disney's India branch might have its value cut in half as a result of its planned merger with Mukesh Ambani's media company, RIL shares increased. Disney's previous demand of $10 billion has been lowered to around $4.5 billion after discussions, according to the article. The merged company hopes to be valued at $11 billion, of which Disney would own 40%.

According to Bloomberg, the purchase will close in February and Reliance Industries will own a 51 percent share. According to estimates, the $10 billion merger between Sony and Zee Entertainment fell through, eliminating a possible formidable competitor.

January saw an 8.6% increase in RIL shares after encouraging remarks on peak capital spending and robust retail performance. Analysts have kept their ratings the same while increasing their target prices.

The third quarter's capital expenditure (capex) for the corporation was Rs 30,100 crore, a 22% decrease from the previous quarter. The drop was caused by lower investment in retail due to restricted site growth and lower spending by Jio after the completion of the 5G rollout across India.

"We anticipate a 15,000 crore year-over-year decline in retail capex in FY2014 and an additional decline in FY2015." Furthermore, Jio's core capital expenditures could drop by Rs 30,000 crore in FY2025, according to Jefferies India. This should assist enhance free cash flow (FCF) and allay worries about the company's net debt growth.

As the 5G deployment got closer to completion, experts said, capital investment declined in the December quarter. Over the last three years, RIL's free cash flow has been negative, mostly as a result of telecom costs. At a $20 billion yearly EBITDA run rate and lower costs, RIL is expected to produce positive free cash flow for the next two years. Analysts predict a declining trend in net debt going forward, reflecting lower capital expenditure and better EBITDA that is supported by the run rate, despite a slight quarter-over-quarter increase in net debt caused by repayment of other capital expenditure liabilities in the three months ended December 31.

"We saw a 2–5% increase in our FY24–26 EBITDA, driven by Jio's higher rate raise, Retail's good recent performance, and O2C's 3Q beat. Nonetheless, we believe that the recent outperformance of the stock has more evenly distributed the risk and reward, therefore we are neutral with a 2,910 TP (+12%; Roll-FWD). Important drivers include the unexpected size of the tariff increase, the Jio/retail monetization update, and the earlier-than-expected deleveraging, according to CITI's most recent report.