Will Reliance Industries Ltd (RIL) finally announce the roadmap for Reliance Jio Infocomm (Rjio) listing at its 47th Annual General Meeting (AGM), following an industry-wide round of tariff hikes? Will there be a timeline for Reliance Retail Ventures Ltd unlocking too? Will there be some cues on strategic stake sale in oil-to-chemicals (O2C) business? How much have been invested in the new energy business -- the next growth avenue where the oil-to-telecom major is infusing Rs 75,000 crore; and how soon will it start delivering earnings? Whether investors will see 5G monetisation and any further updates on the succession plan at India's most-valued firm? These are the five hot topics that 33.71 lakh retail investors at RIL would seek clarity tomorrow, August 29.
Ahead of its AGM, RIL shares were trading flat at Rs 3,001 on Wednesday. The stock is up 16 per cent year-to-date against 13.41 per cent rise in the BSE Sensex and 40.77 per cent surge in the BSE oil & gas index during the same period.
In the case of retail, the RIL focus has been on operational efficiency as the capex intensity has been moderated and stores rationalised. In the case of O2C, earnings has been steady of late. "Timelines for commencement of new energy products and potential listings of Jio and Reliance Retail will be key things to focus on," Bernstein said recently. The foreign brokerage suggested a revised target price of Rs 3,440 for RIL from Rs 3,190 earlier.
The RIL AGM 2023 had seen the formalisation of succession plan for RIL by Mukesh Ambani, the announcement regarding AiFiber and suggestions of potential investors in Reliance Retail.
JM Financial said that the timelines for listing of Retail and Digital businesses and any potential strategic stake sale in O2C business would be keenly watched. It is believed that the IPO plans for the telecom arm would be announced first. Jefferies recently valued Reliance Jio Infocomm at $112 billion.
"Any update on the progress of various projects underway in New Energy business with timelines around project commissioning and earning potential from such projects would be keenly followed," JM Financial said.
RIL had in its 2022 AGM announced Rs 75,000 crore investments in New Energy. In its 2023 AGM, Mukesh Ambani said RIL was progressing well to deploy its committed capital to build New Energy manufacturing ecosystem.
"This will enable us to accelerate giga-scale production for round-the-clock power and for large-scale Green Hydrogen production for green chemicals manufacturing, as well as for green mobility," he noted. Updates on New Energy biz, thus would be noteworthy.
The FY24 annual report suggested RIL will continue to monitor financial markets to seize suitable opportunities for capital-raising to support its growth plans
"New energy will be commissioning its first train of module and cell manufacturing in FY25. Solar panels manufactured in Jamnagar have obtained BIS certification. Parallelly, work on RE development has commenced and Reliance has been allotted land in Gujarat. The company aims to become the largest RE developer in India. It has initiated participation in RE PPA with the first PPA signed with MSEDCL for 128 MW for 25 years," ICICI Securities said in a note.
The broking said investments in the new energy segment will start playing out gradually, with others segment having grown in capital employed by 3.9 times over FY19–24 to Rs 2.1 lakh crore.
"Any announcement of IPO plans for the telecom/retail business and further clarity on the New Energy segment are key upside risks to our call," Elara Securities said last month.
On O2C business, BoB Capital Markets noted that RIL's annual report largely talked about external market changes, which indicates that there is no focus on large O2C investments in the near term.
Meanwhile, investors would be keenly awaiting updates on 5G monetisation plans and any further update around succession plans.