i Develop Stocks Advisory

Re-rating trigger in RIL....

Reliance Industries Ltd reported net profit of Rs 8079 crs on equity of Rs 1454 crs post IPCL merger. This includes Rs 4733 crs extra ordinary income. Yet the nos are better than expected. However, the catch of RIL is not in nos (it is always underperformed stocks in comparison with global peers) ; the catch is in its value unlocking.

Reliance also announced that “

1. Reliance Digital Retail Ltd,
2. Reliance Brands Pvt Ltd,
3. Reliance Wellness Ltd,
4. Reliance Footprint Ltd,
5. Reliance Integrated Agri Solutions Pvt Ltd,
6. Reliance Trends Ltd,
7. Reliance Lifestyle Holdings Pvt Ltd,
8. Reliance Universal Ventures Pvt Ltd,
9. Reliance Autozone Pvt Ltd,
10. Strategic Manpower Solutions Pvt Ltd,
11. Reliance Gems and Jewels Ltd,
12. Delight Proteins Pvt Ltd,
13. Reliance F&B Services Pvt Ltd,
14. Reliance Agri Products Distribution Pvt Ltd,
15. Reliance Leisures Pvt Ltd,
16. Reliance Retail Securities and Broking Company Pvt Ltd,
17. Reliance Home Store Pvt Ltd,
18. Reliance Trade Services Centre Pvt Ltd,
19. Reliance Food Processing Solutions Pvt Ltd,
20. Reliance Supply Chain Solutions Pvt Ltd,
21. Reliance Digital Media Pvt Ltd,
22. Reliance Loyalty & Analytics Pvt Ltd” ie 22 companies have become subsidiaries of the Company.

This has potential value unlocking entities of RIL gr of companies. If RIL gr decides to unlock value in any of these entities which is basically part of retail chain then RIL gr’s market cap may rise substantially again. This is a pointer to the fact the some value unlocking may happen in coming months.

We suggest investors to remain invested in RIL stock and our target of 3500 in intact. The correction in the stock was the immediate reaction of winding up of long positions traders had taken on various buy calls in last 2 weeks. Not only our target is intact but also the story is intact and those who wish to increase commitments may take call on RIL again with the target of 3500.