Stories
Reliance Industries Shares Could Surge 47 Percent on Jio IPO Value Unlock
- •The upcoming Jio Platforms initial public offering could act as a major catalyst by unlocking the standalone value of the digital business.
- •Religare Broking expects the listing to narrow the holding company discount currently assigned to Reliance Industries.
- •IPO proceeds of around 27500 crore rupees are earmarked for debt reduction, which will strengthen the balance sheet and improve free cash flows.
- •Progress across retail, new energy, and oil-to-chemicals businesses could push the stock towards 1696 rupees over the next 36 months.
Key Questions Answered
The Jio Platforms IPO is expected to improve visibility into Jio's standalone valuation, which will help narrow the holding company discount currently assigned to Reliance Industries. Additionally, proceeds of around ₹27,500 crore earmarked from the IPO will be utilized for debt reduction, thereby strengthening the company's balance sheet and increasing free cash flows over time.
According to Religare Broking, the listing of Jio Platforms along with progress in retail and new energy businesses could support a stock re-rating that helps Reliance Industries shares move towards ₹1,696 over the next 36 months. However, the near-term price movement is expected to face resistance around the ₹1,350 to ₹1,400 range.
Jio Platforms is preparing to launch its initial public offering this month, with public subscription expected to open from October 21 to 23 and stock market listing anticipated around October 28. The IPO will comprise a fresh issue of roughly 2.93 percent of total equity, offering approximately 27 crore new shares to enable price discovery.
