Reliance Industries stock closes higher after investment in media start-up, thumbs up by BoAML

The Reliance Industries stock closed higher in trade today a day after the conglomerate announced it has invested into media start-up New Emerging World of Journalism Private Limited (NEWJ) via its arm (RIIHL). The stock gained 1.66% or 18.75 points to 1,146 level compared to its previous close of 1127.50 on the BSE.

The stock hit an intra day high and low of 1157.70 and 1126.50 on the BSE. 26 of 36 brokerages rate the stock "buy" or 'outperform', five "hold", one "underperform" and four "sell", according to analysts' recommendations tracked by Reuters.

The stock has been gaining for the last three days and risen 3.94% in the period.

The large cap stock has gained 24.45% since the beginning of this year and risen 21.56% during the last one year.

The stock closed above its 50-day and 200-day moving average of 1,097.23 and 1,104.31.

Reliance Industries invested into the start-up via its subsidiary Reliance Industrial Investments and Holdings Limited (RIIHL).

As initial tranche, RIIHL has subscribed to 30,000 equity shares and 125 compulsory convertible debentures for total cash aggregating to Rs 1.03 crore and consequently NEWJ has become subsidiary of RIIHL and the company.

NEWJ is an early stage technology start up incorporated in India in January 2018. NEWJ's business focus areas are production and curation of content for the emerging social and digital media ecosystem.

Further, NEWJ will also be developing data enabled technology products which allow for integrated models of reporting and distribution.  The investment does not fall within related party transactions and none of company's promoter / promoter group / group companies have any interest in NEWJ, the firm said.

Meanwhile, global investment firm Bank of America Merrill Lynch (BoAML) has maintained its buy call on the Reliance Industries stock and raised its price target by nearly 12%.

The oil-retail-to-telecom conglomerate has crossed the tipping point in consumer acceptability and shifted from B2C to B2B to help valuations, BoAML said.

The research house raised its target price to Rs 1,430 from Rs 1,280 earlier, a 29 percent potential upside as it said RIL transitioned from an oil & gas conglomerate to India's "everything company".