RIL shares up 25% this year: What should investors do with the stock?

Shares of Reliance Industries (RIL) seem to be on a record breaking spree as investors lap up the stock believing in its growth story, thanks to the visible progress on the front of Reliance Aramco deal, rapidly increasing digital footprint of Reliance Jio, healthy growth prospects of Reliance Retail and the company’s plans regarding the renewable energy business.

On September 6, the stock climbed 4 percent to hit its fresh record high of Rs 2,479.85 on BSE, jumping as much as 25 percnet year-to-date (YTD). Such a strong gain in a heavyweight like Reliance Industries is a huge thing and indicates strong optimism regarding the company’s growth prospects, experts point out.

The stock made a fresh peak of September 6 after its subsidiary Reliance Strategic Business Ventures (RSBVL) acquired 2,28,42,654 equity shares of Rs 10 each of Strand Life Sciences for a cash consideration of Rs 393 crore.

A further investment of up to Rs 160 crore is expected to be completed by March 2023, RIL said in a regulatory filing and added that the total investment will translate into 80.3 percent of equity share capital in Strand on a fully diluted basis.

The rally in the stock is not done yet, experts point out as the fundamental outlook of the stock suggests it may go further.

“Reliance industries have been soaring on the back of fast progress made in the Saudi Aramco deal. The other reasons that are responsible for soaring price is the increase in Reliance Jio and its digital footprint. The expansion of Reliance industries in solar power business has also positively impacted the prices,” said Ashis Biswas, Head of Technical Research at CapitalVia Global Research.

He expects the price of Reliance industries to go till the level of Rs 2,700-2,750 by the end of the year.

Global financial Firm Morgan Stanley has an ‘overweight’ view on RIL stock with a target price of Rs 2,269.


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