Will Reliance stock see significant upside in the near term? Sushil Choksey answers
COVID they will accept a few more rounds of investment before they plan the listing," says Sushil Choksey, Indus Equity Advisors.
With Qatar Sovereign Fund's investment into Reliance Retail, I mean, the retail valuation has gone up 2x in about three years. Do you think this move could act perhaps as a soft floor to Reliance Industries, if not significant upside?
It certainly establishes a value that everybody in the research reports have read that Reliance Retail would be valued at 1300, 1400, 30 times sales or 33 times EV to EBITDA, so various numbers based on growth patterns and number of outlets they have established so far.
Based on what I can make out, Qatar, is it the first investment which they have accepted or like three years back in COVID they will accept a few more rounds of investment before they plan the listing.
So, how Mukesh Ambani's speech on AGM on Monday, 28th, pans out on this direction that needs to be seen but it is definitely a direction that now three years are done for the previous round of investment, which had come in at half the value than what current round has happened so Reliance Retail future looks promising because these people will be investing more and more money in rolling out more outlets, more formats.
Now Jio Financial will be supporting all the retail distribution and marketing in terms of financing and the competitors have, so the growth path is very open and looks like Reliance Retail firmly establishes the value which all the brokerage reports have indicated so far in the region of 1300.
But it is good that the market is established with a dollar check which is put in the balance sheet and it sustains from here and grows faster from the current value.
This deal in a sense is only
