Explained: RIL shares on a roll! Here's what brokerages say

Shares of Reliance Industries were on a roll on Monday after the company incorporated a new subsidiary in the UAE for trading in crude oil, petroleum products and agricultural commodities.

The large-cap stock rose 2 per cent to hit an all-time high of Rs 2,574.65 on BSE. It ended 1.31 per cent higher at Rs 2,555.85 against the previous close of Rs 2,522.85. Market cap of the firm rose to Rs 16,20,266.57 crore on BSE.

The share hit 52-week low of Rs 1,830 on January 29, 2021. Reliance Industries shares stand higher than 5 day, 20 day, 50 day, 100 day and 200 day moving averages. The stock has gained 15 per cent in one year and risen 29 per cent since the beginning of this year.

Reliance International Ltd has been incorporated as a wholly-owned subsidiary in Abu Dhabi Global Market, the United Arab Emirates (UAE), the firm said in a stock exchange filing.

"The company has invested Rs 7.42 crore or $1 million in cash in 10 lakh equity shares of $1 each of 'Reliance International Limited'," the filing said.

On September 21, ICICI Direct initiated coverage on the stock. The brokerage house said that the long term prospects and dominant standing of RIL in each of its product & service portfolio, provides comfort for long term value creation.

"RIL's consumer business will be the growth driver, going ahead. The company has a strong balance sheet post fundraising while its traditional
business will continue to generate steady cash flows," it added.

"We continue to maintain our positive view on the long-term performance of RIL and like the business reorganization initiatives at RIL with the creation of O2C business segment (combining Refinery and Petrochemicals to generate new materials and energy business for sustainable future), and its ability to attract long term investors and acquire businesses or start a new initiative from the scratch to propel the strategic growth agendas," said KR Choksey.

Recently, Reliance Strategic Business Ventures Limited, a wholly-owned subsidiary of Reliance Industries Limited acquired 2,28,42,654 equity shares of Rs 10 each of Strand Life Sciences Private Limited for a cash consideration of Rs 393 crore.

"A further investment of up to Rs 160 crore is expected to be completed by March 2023. The total investment will translate into 80.3% of equity share capital in Strand on a fully diluted basis," RIL said.

According to MarketsMojo, the company has high institutional holdings at 38.38% and the technical trend has improved from Mildly Bullish on August 30, 2021, and the stock is technically in a Bullish range now. Multiple factors for the stock are bullish like MACD, Bollinger Band, KST and DOW. However, it has an expensive valuation with a 2.3 Price to Book Value.