Reliance Industries ’(RIL) petrochemical sustained performance has improved the probability of selling O2C shares in fiscal 22, financial services company Jefferies said.
As a result, Jefferies kept the so-called “buy” call on RIL with a target and 2,580 rupees or 30% upside down.
“At the current share price, valuing the energy business in multiple long-term means, we are left with 1,150 rupees per share as the imputed value of RIL’s stake in‘ Jio ’and‘ Retail ’,” Jefferies said in a report.
“This is in line with the valuation offered by PE funds that bought stakes in Jio and Retail on 1QFY21.”
In addition, the report noted that strong sustained petrochemical performance has improved the probability of selling O2C stakes in fiscal year 22.
“This could lead to a 40% investment in Nifty underperformance. Our PT (Rs 2,580) represents 30% upside down.”
As for the confrontation, the report said that the strength of demand for fiscal support to major economies, the launch of new projects and the penetration of vaccination should support the margins of the polymers of the fiscal year 22E.
“Demand (polymer) is based on the strength of later industries: automobiles, durable goods, consumer goods, medical supplies and packaging. Consumer spending in the US and China remains strong, for example, the rate of containers from China to the US 50% higher than the previous one in the maximum decade, China imports in 1QCY21 55% more than in 1QCY19 “.
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(Only the title and image of this report may have been reworked by Business Standard staff; the rest of the content is automatically generated from a syndicated feed.)
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