Reliance Industries Ltd (RIL) has become the first Indian company to surpass a market capitalization of Rs 21 lakh crore.
· The landmark achievement was marked when RIL’s stock price soared to a record high of Rs 3,129 during early trading.
· Brokerage firms have responded positively to RIL’s performance by raising their price target for the company.
· Analysts have overwhelmingly expressed confidence in the company’s future. Out of 35 analysts, 28 recommend a ‘Buy’, five advise ‘Hold’, and only two suggest ‘Sell’.
In a remarkable financial feat, Reliance Industries Ltd (RIL) has become the first Indian company to surpass a market capitalization of Rs 21 lakh crore. This significant milestone underscores the company’s dominant position in the Indian market and its robust growth trajectory across various sectors.
The landmark achievement was marked when RIL’s stock price soared to a record high of Rs 3,129 during early trading. This surge represents a more than 20% increase in the stock price this year alone, reflecting strong investor confidence and robust business performance. By 12:12 pm, the stock had climbed 1.69%, reaching a notable Rs 3,112.85 per share, further solidifying its market dominance.
The impressive rise in RIL’s stock was primarily driven by recent tariff hikes introduced by Reliance Jio, the company’s telecom arm. The new tariff plans range from Rs 189 for 2 GB per month to Rs 3,599 for an annual plan offering 2.5 GB per day, with unlimited 5G data included in plans of 2 GB per day and above. These tariff adjustments are expected to boost Jio’s revenue and enhance its competitive edge in the rapidly growing telecom market.
Brokerage firm Jefferies has responded positively to RIL’s performance by raising its price target for the company from Rs 3,380 to Rs 3,580, indicating a potential 17% upside from the recent closing price. The firm maintained its ‘Buy’ rating and projected an annual growth rate of 18% for Jio’s revenue and 26% for its profit from FY24 to FY27, underscoring the long-term growth prospects of the company.
Morgan Stanley also maintained its ‘Overweight’ rating with a target price of Rs 3,046. The firm noted that the recent tariff hikes align with market expectations and anticipate new energy cash flow streams for RIL by the end of the year. While no additional tariff hikes are anticipated until FY27, a potential 20% increase next year could significantly boost RIL’s earnings by 10-15%, according to Morgan Stanley.
Kotak Securities shared a similarly optimistic outlook, viewing the tariff hikes as a positive development that competitors Bharti Airtel and Vodafone Idea are likely to follow. Kotak set a target price of Rs 3,300 for RIL, reflecting its confidence in the company’s continued strong performance and market leadership.
Centrum Broking reiterated its positive outlook on the telecom industry’s Average Revenue Per User (ARPU), projecting a compound annual growth rate (CAGR) of 10-12% to Rs 300 over the next 3-4 years. This growth is attributed to the consolidated industry structure and the higher ARPU requirements needed for Jio to justify significant 5G investments and a potential initial public offering (IPO).
Analysts covering Reliance have overwhelmingly expressed confidence in the company’s future. Out of 35 analysts, 28 recommend a ‘Buy’, five advise ‘Hold’, and only two suggest ‘Sell’. This widespread confidence reflects the belief in RIL’s ability to maintain its growth momentum and continue its dominance in the Indian market.
The crossing of the Rs 21 lakh crore market capitalization threshold marks a historic moment for Reliance Industries and highlights the company’s significant role in shaping the future of the Indian economy.
(With inputs from agencies)
