The road to Rs 15 lakh crore market cap

Published in Value Research
6 days ago

Reliance Industries is the first-ever Indian company to cross the Rs 10 lakh crore market cap, with its one-year return (as on August 17, 2020) at over 67 per cent. Until two years ago, the stock was a slowly growing one. For some time, TCS had overtaken Reliance in terms of the largest Indian company by market cap. But then happened the turnaround, thanks mostly to Reliance Jio. Jio not just helped Reliance become net debt-free, it has also turned an otherwise boring oil-and-gas stock into a Street heartthrob. Over the last few months, Jio Platforms has helped Reliance raise over Rs 1.5 lakh crore.

Another feather in the company's cap is its retail business, which is growing by leaps and bounds. Talks are underway between the Future Group and Reliance for a stake sale in the former. For Reliance investors, a lot has happened over the last one year or so. It's likely that a lot of steam is still left. Here's Reliance's journey to its current market cap of over Rs 14 lakh crore.

The graph below traces the rise in stock price of the company. Here are some important milestones
FY10-11
Enters into partnerships in North America for shale-gas exploration Strategic alliance with BP for domestic oil-and-gas exploration Forays into telecom, gets pan-India broadband wireless licence by acquiring 95 per cent stake in Infotel Broadband Services for Rs 4,202 cr
FY11-12
With 1,300 stores, Reliance Retail becomes a leader in food, apparel and consumerelectronics retailing
FY12-13
Retail business crosses Rs 10,000 cr sales in FY13. Buys back Rs 3,366 cr of stock Renames Infotel Broadband Services as 'Reliance Jio Infocomm Ltd', RJIL.
FY13-14
Retail business crosses 10 mn square feet of retail space and breaks even on a net-profit basis Reliance Jio acquires the right to use spectrum in 14 key circles across India in the 1,800 MHz band Enters into infrastructure-sharing arrangements with other telecom players
FY14-15
Invests over Rs 1 lakh cr during the financial year across various businesses To boost its media business, acquires the control of Network18 and its subsidiary TV18
FY15-16
Capex of over Rs 1.12 lakh cr (US$17 bn) in FY16, the highest-ever by any Indian corporate Beta testing of Jio with over 1.5 mn test users Launches 4G smartphones under the 'LYF' brand Sells 49.9 per cent stake in a US shale oil and gas pipeline joint venture for $1.07 bn
FY16-17
Jio adds 100 mn subscribers within 170 days of launch. Offers free voice calls. Jio Prime membership gains over 72 mn subscriptions Jio announces that it will start charging customers for data services
FY17-18
Constructs the world's largest petcoke gasification unit at Jamnagar Jio earns a profit of Rs 723 cr on turnover of Rs 23,714 cr in its first year of commercial operations Jio forges partnerships with the likes of Balaji Telefilms, Eros International and Saavn to build entertainment and media-content offerings.
FY18-19
Retail business crosses Rs 1 lakh cr in revenue and the store count of 10,000 Jio crosses 300 mn subscribers. Becomes the largest 4G carrier in India. Enters into a series of content partnerships with Disney and Star India, among others Invests in Hathway Cable and Datacom and DEN Networks to expand the Jio Fiber business The petchem business has a record production of 37.7 MMT and the highest-ever earnings Wins $1.7 bn arbitration claim by the government over siphoning gas from ONGC's KG-D6 basin
FY19-20
In talks with Saudi Aramco for a stake sale of 20 per cent in oil-tochemical division. Completes rights issue of Rs 53,124 cr Raises over around Rs 1.52 lakh cr from global tech companies and private-equity firms by selling stake in Jio Platforms. Post the stake sale, owns about 65 per cent in Jio. Forms strategic partnerships with Microsoft to grow cloud business and with Facebook to grow digital retail business through WhatsApp Forms a new JV with BP to grow the network of retail service stations network and aviation fuel business across India


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