RIL surges 3% to reclaim Rs 1,400 level; can it rise to Rs 1,600?
The stock climbed 2.86 per cent to hit a high of Rs 1,408 on BSE.
By ETMarkets.com | Updated:
NEW DELHI: Shares of Reliance Industries climbed nearly 3 per cent to reclaim Rs 1,400 mark in trade on Friday as investor community stay largely positive on the firm prospects, with some analysts seeing the stock at Rs 1,600 over the next 12 months.
The stock climbed 2.86 per cent to hit a high of Rs 1,408 on BSE. The scrip had hit a high of Rs 1,448.50 on April 6 this year. At Rs 4.55 lakh crore in market value, the stock was close to pip TCS (Rs 4.56 lakh crore) again as the most valued listed company.
Edelweiss Securities in a note pointed out that Reliance Industries’ ( RIL) $20 billion core capex is seeing fruition which will instantly bolster its earnings, unlike the uncertainties associated with RJIO.
“One of the major core projects - $1.5 billion ethane imports from the US - has been commissioned. The highly competitive ethane imports will replace the existing expensive propane feedstock to RIL’s crackers, generating savings of nearly $350 million (3 per cent of RIL’s FY18E EBITDA) and healthy project RoCE of 18 per cent,” the brokerage said.
“Following commissioning of mega core projects in near term, we expect RIL’s FCF to turnaround, RoE to rise and profits to double in 5 years. We reiterate ‘BUY/SO’ with a revised target price of Rs 1,600 from Rs 1,452 earlier,” it said.
The stock climbed 2.86 per cent to hit a high of Rs 1,408 on BSE. The scrip had hit a high of Rs 1,448.50 on April 6 this year. At Rs 4.55 lakh crore in market value, the stock was close to pip TCS (Rs 4.56 lakh crore) again as the most valued listed company.
Edelweiss Securities in a note pointed out that Reliance Industries’ ( RIL) $20 billion core capex is seeing fruition which will instantly bolster its earnings, unlike the uncertainties associated with RJIO.
“One of the major core projects - $1.5 billion ethane imports from the US - has been commissioned. The highly competitive ethane imports will replace the existing expensive propane feedstock to RIL’s crackers, generating savings of nearly $350 million (3 per cent of RIL’s FY18E EBITDA) and healthy project RoCE of 18 per cent,” the brokerage said.
“Following commissioning of mega core projects in near term, we expect RIL’s FCF to turnaround, RoE to rise and profits to double in 5 years. We reiterate ‘BUY/SO’ with a revised target price of Rs 1,600 from Rs 1,452 earlier,” it said.
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