Mukesh Ambani-led Reliance Industries Ltd became the first Indian company to hit the ₹10 lakh crore milestone in market cap after its shares rose to a record high of ₹1,581 apiece.
Investors were encouraged after Mukesh Ambani announced plans to cut the company’s net debt to zero in 18 months through measures like stake sale in the oil-to-chemicals business to Saudi Aramco.
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RIL shares have outperformed the market since the start of this year, surging nearly 40%. Its telecom arm Jio also announced that it will increase tariffs soon.
RIL operates the world’s biggest oil-refining complex in Jamnagar, Gujarat, which can process low-quality crude and turn it into higher-grade fuels.
RIL had announced earlier that it would invest over ₹100 lakh crore to create a digital services company as it seeks to cut debt for its Jio arm.
The company will have the rights to convert its ₹108 lakh crore investment in the new digital company into equity. The new unit will invest the funds in Jio which will help make telecom arm net debt-free by the end of March 2020.
With likely receipt of ₹1.1 trillion from Aramco and BP in FY21, RIL is on course to achieve its target of zero net debt, says Edelweiss Securities.