Many milestones as Reliance climbs to new peak

KS Badri Narayanan Chennai | Updated on June 19, 2020

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The share price of Reliance Industries has leapfrogged into a new territory. The stock hit an all-time high of ₹1,788.96 amidst copious fund-raising and on the positive outlook, especially due to Jio. During the course of attaining the peak, the Mukesh Ambani-controlled Reliance Industries has achieved several milestones.

Reliance has become the first company to surpass the ₹11-lakh-crore market capitalisation mark. At ₹11.2-lakh crore, the RIL stock now leads TCS by a wide margin of ₹3.45-lakh crore.

However, the bigger achievement is becoming net debt-free, given the current volatile situation. For the first time in nearly two decades, the company has become net debt-free. Even as Mukesh Ambani promised to make the company net debt-free by March 2021, the task has been achieved much earlier, at a time when the entire world is talking of gloom and doom, and several organisations shut due to killer Covid-19 pandemic virus.

Saudi Arabia-based wealth fund Public Investment Fund is the eleventh to join the host of investors who have picked up equity stakes in Jio Platforms. Within nine weeks, the company has raised a whopping ₹1.15-lakh crore from investors such as Facebook, Silver Lake Partners, Vista Equity Partners, General Atlantic, KKR, Mubadala, Abu Dhabi Investment Authority and L Catterton.

Besides, the oil-to-telecom conglomerate company had successfully completed the biggest ever rights issue by any Indian company by raising ₹53,125 crore from the existing shareholders. The issue, which was priced at ₹1,257 each, came with an entitlement ratio of 1:15 (one equity share issued for every 15 shares held).

Rights entitlements

The rights issue also experienced a historical first trading of rights entitlements through exchange mechanism. It had provided an opportunity for many retail investors to trade in the rights issue like normal equity transaction and also allowed them to sell their eligible/ entitled portion of shares to other investors who had wanted to bid for higher number of shares.

The promoter family’s stake in Reliance Industries hit a 12-year high of 49.14 per cent, thanks to the mega rights issue.

Reliance Industries is now “in its golden decade,” said Mukesh Ambani. “I have fulfilled my promise to the shareholders by making Reliance net debt-free much before our original schedule of March 31, 2021,” he said in a statement released early on Friday.

A proud achievement indeed.

Published on June 19, 2020

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