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Analysts Recommend “Subscribe” To Reliance Right Issue May 23 2020Right Issue

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Analysts Recommend “Subscribe” To Reliance Right Issue

The biggest ever right issue in the history of the financial market started on 20th May. The Rs. 53,125 crore right issue by Reliance Industries allows existing shareholders to get the company’s shares at Rs. 1,257. An investor holding shares of Reliance Industries on 14th May in the demat account would be eligible to apply for the issue. The entitlement ratio for the right issue is 1 share for every 15 shares held by the eligible shareholders.

Owing to the numerous reasons, analysis all over are recommending subscription to Reliance right issue. The following are the reasons that analysts are positive about this right issue.

·         The flexibility in the payment system of the right issue is one of the primary reasons for recommending Reliance right issue. The investor is required to pay just one-fourth of the due amount initially to invest in a world-class business. The remaining two instalments fall in the next year.

·      With the right issue, the company will be having sufficient funds to lower down its debt levels. The company is on course to meet its target of becoming debt-free by 2021.

·         The major part of Reliance’s value comes from the B2C businesses that include telecom and retail. Both the businesses are performing extremely well and with the entry of marquee investors, the growth in the business shall continue.

·         The right issue along with stake sale in the Jio Platform gives visibility in the cash inflows of the company.

·         According to The Sum-Of-The-Parts Valuation(SOTP), the actual value of the company’s stock comes around Rs. 1,680. This suggests that a significant upside can be seen from the current levels.

·         Reliance is offering its business to the current shareholders at a substantial discount that makes the right issue very attractive.

The above mentioned are a few reasons why the analysts are recommending the investors to subscribe to the Reliance right issue. To know more about the share market information and opening online demat account, you can get in touch with Indira Securities. We are one of the leading share market brokers in India.


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INDIRA SECURITIES PVT.LTD. (SEBI REG.NO.):NSE TMID: 12866, BSE TMID: 663, CDSL DPID: 17000 SEBI REG. NO.: INZ000188930, MCX TM ID: 56470, NCDEX TM ID: 01277, CDSL REG. NO.: IN-DP-90-2015, CIN : U67120MH1996PTC160201




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