1:1 Bonus Issue By Largest Oil & Gas Stock; BUY Reliance Stock That Gave Zero Returns YTD; New Target Price

Mukesh Ambani-backed Reliance Industries (RIL) stock price has turned red in so far 2024 performance. Meaning, that the stock has given zero returns YTD, on a half-yearly, monthly and weekly basis. This comes despite the largest oil and gas stock's bonus issue whose ratio adjusted its stock price. Currently, Reliance is below Rs 1,300 levels but continues to be the largest company in India in terms of market cap. Despite the red line in Reliance, the majority of brokerages have recommended BUY.

Reliance Industries Share Price:

After market hours, Reliance stock ended at Rs 1284 apiece, down by 1.66% on November 8, with a market cap at Rs 17,37,556.68 crore. The stock erased its Rs 1,300 mark accordingly.

Reliance's weekly performance is down by 2% on BSE, while its monthly performance has dipped by 6.6%. In six months, the stock plunged by 7.9%. While year-to-date, the stock is down by nearly a per cent. In a year though, the stock has gained by 11%.

Reliance Industries Bonus Issue:

Reliance has allotted 676,61,86,449 equity shares of Rs. 10/- (Rupees Ten only) each as fully paid-up bonus equity shares, in the proportion of 1:1, i.e., 1 (One) new fully paid-up equity share of Rs. 10/- (Rupees Ten only) each for every 1 (One) existing fully paid-up equity share of Rs. 10/- (Rupees Ten only) each, to the eligible members of the Company whose names appeared in the Register of Members / Register of the Beneficial Owners, as on October 28, 2024, the 'Record Date' fixed for this purpose.

Post the bonus issue allotment, the paid-up equity share capital of the Company stands increased to Rs. 13532,37,28,980 divided into 1353,23,72,898 equity shares of Rs. 10/- each.

The bonus issue ratio was 1:1. This will be the first bonus issue by Reliance in seven years. The last bonus issue was also of 1:1 ratio in September 2017. While Reliance's first bonus issue was also 1:1 in November 2009.

BUY/SELL Reliance Stock:

As per Trendlyne data, the consensus recommendation from 37 analysts for Reliance Industries Ltd. is BUY. Of the total, 15 analysts have suggested 'STRONG BUY', and 13 analysts have recommended 'BUY'. EPS is expected to grow by 3.7% in FY25. The average 1-year target price is Rs 1616.43 apiece, hinting at a potential 26% upside ahead.

HDFC Securities in its SAMVAT note said, given the large technological advancements and ambitious growth targets, Reliance's Retail, Telecom, and new energy segments are poised to become the upcoming growth drivers over the next two to three years. The company aims to double its EBITDA in the next five years, powered by 5G opportunities, increased investments in AI/data centers, further expansion in Retail and the start of PV/battery facilities in New Energy. The company could report a consolidated revenue/EBITDA/PAT CAGR of approx. 19%/14%/16% over FY24-26E. Investors can buy in the Rs. 2447-2716 band for a target of Rs. 3243 (23.5x FY26E EPS) till next Diwali.

Reliance Industries Limited (RIL) is a Fortune Global 500 company and the largest private sector company in India. RIL is a diversified conglomerate with business interests across oil refining, petrochemicals, exploration and production, retail, and digital services.