Reliance Industries may become $100 billion market cap firm

Written by Amit Agarwal on Jul 31, 2007

Reliance IndustriesIf you are thinking that there is very little left in terms of appreciation in Reliance Industries especially the stupendous returns it has given post demerger  and split with Anil Ambani, then there is some food for thought. Leading brokerage and equity research company, Morgan Stanley has projected the share price of RIL to rise 35% from current levels in 1 year.

If such happens, then the market capitalisation of Reliance Industries will rise from current $64 billion to $100 billion, making it the first Indian company to achieve this feat.

The 30 companies of Sensex together have a market cap of around $500 billion while those of entire listed companies in India is around 41 trillion. In comparison the 30 constituents of Dow Jones Industrial Average have a m-cap of over $4 trillion with Exxon Mobil being the most valuable with a market value of $485 billion.

The report states that the prime drivers for increasing value of RIL would be the increase in reserves for exploration and production business, improved refinery performance, new gas contracts, higher global refining margins and setting up of pan-India retail network. On the flip side, the risk are cut in import tariffs, rupee appreciation and delays in execution of business plans.

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