Reliance Industries shares in news on report ADIA may invest $600 million in retail biz

Shares of Reliance Industries Ltd will be in focus on Wednesday amid a media report suggested that existing investor Abu Dhabi Investment Authority (ADIA), a Gulf sovereign fund, was seeking an additional stake in the retail arm Reliance Retail Ventures (RRVL) of the oil-to-telecom major. The fresh report came weeks after a report suggested that Reliance Retail was in talks with existing investors such as the sovereign wealth funds of Saudi Arabia, Abu Dhabi and Singapore for combined fresh investments of $1.5 billion.

As per the ET report today, ADIA is eyeing $600 million worth stake in the Mukesh-Ambani retail company, which it says will be valued significantly higher than during an earlier concluded round three years ago. The previous fund-raise round by RRVL in 2020 from several global investors aggregated to Rs 47,265 crore and was done at a pre-money equity value of Rs 4.21 lakh crore.

At present ADIA owns 1.2 per cent stake in RRVL. The current valuation is about 60 per cent higher than the last round but lower than Street estimated value of $131 billion, the ET report.

Last month, a wholly-owned subsidiary of Qatar Investment Authority invested Rs 8,278 crore into RRVL, valuing RRVL at a pre-money equity value of Rs 8.278 lakh crore. QIA’s investment translated into a minority stake of 0.99 per cent in RRVL on a fully-diluted basis. Also, investment firm KKR, through an affiliate, invested Rs 2,070 crore in RRVL and raised its stake to 1.42 per cent. That investment Investment valued RRVL at a pre-money equity value of Rs 8.36 lakh crore.

Shares of Reliance Industries are down 1.49 per cent year-to-date. This is against a 7.81 per cent rise in the BSE Sensex during the same period.

At an estimated net debt of Rs 33,200 crore in FY25, the RRVL’s enterprise value stands at Rs 8.6 lakh crore and equity per share value stands at at Rs 1,200, Motilal Oswal Securities said last month.

Reliance Industries had earlier suggested that several marquee financial and global strategic investors expressed interest in the retail business and that it would provide details in due course.

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