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Reliance Industries Becomes India’s First Company To Hit Rs 11 Lakh Crore In Market Value

Shares of Reliance Industries Ltd. rallied over 6% today to Rs 1,759 apiece—an all-time high.

Mukesh D. Ambani, chairman of Reliance Industries Ltd. (Photographer: Prashanth Vishwanathan/Bloomberg) 
Mukesh D. Ambani, chairman of Reliance Industries Ltd. (Photographer: Prashanth Vishwanathan/Bloomberg) 

Billionaire Mukesh Ambani’s flagship Reliance Industries Ltd. became the first Indian company with a market value of Rs 11 lakh crore as investors rejoiced fundraising that will make it debt-free.

Shares of Reliance Industries rallied over 6% on Friday to Rs 1,759 apiece—an all-time high. The stock has surged 17.3% so far this year, while the benchmark NSE Nifty 50 has fallen 15.8% during the same period.

Reliance Industries Becomes India’s First Company To Hit Rs 11 Lakh Crore In Market Value

At close, Reliance Industries’ market capitalisation stood at Rs 11.15 lakh crore, making it India’s most valuable company by a wide margin. The closest is Tata Consultancy Services Ltd. followed by HDFC Bank Ltd.—both of which have seen negative returns in 2020.

The rally in the oil-to-telecom conglomerate’s shares came after a massive fundraising spree by its telecom subsidiary Jio Platforms Ltd. from high-profile investors. Over the course of two months, Ambani has raised nearly Rs 1.15 lakh crore by selling almost 25% stake in Jio.

Investors, including Facebook Inc., Saudi Arabia’s sovereign wealth fund, Abu Dhabi Investment Authority, General Atlantic, Vista Equity Partners, KKR, Mubadala, Silver Lake, TPG Capital and L Catterton, have all bought into Jio’s potential to disrupt India’s consumer market.

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But a bigger factor behind the rally was the that the parent Reliance Industries is now well on course to become debt-free before the end of the fiscal—a task Ambani had set out to achieve less than a year ago.

The company today said that the Rs 1.15-lakh crore fundraise, coupled with the Rs 53,124-crore rights issue—also first of its kind for an Indian firm—will help the company retire its debt. As of March 31, 2020, the company’s net-debt was Rs 1.61 lakh crore.

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“I am both delighted and humbled to announce that we have fulfilled our promise,” Ambani was quoted as saying in a statement.

The milestone is a testament to Jio’s meteoric growth in India’s telecom market. Within four years of its launch, the company has already become India’s largest telecom operator by subscribers, amassing nearly 40 crore users. It now plans to use that customer base to build e-commerce and digital businesses.

Reliance Industries Becomes India’s First Company To Hit Rs 11 Lakh Crore In Market Value