Reliance share price rallies 2.5% after 2 days of selloff; Vaishali Parekh recommends buying

On BSE, RIL shares closed at ₹2,377.40 apiece up by ₹54.65 or 2.35%. It is the largest Indian company in terms of market share.

As of February 14th, RIL’s market cap is over ₹16.08 lakh crore.

RIL shares soared by as much as 2.51% with an intraday high of ₹2,381 apiece on Dalal Street during Tuesday’s session.

Vaishali Parekh, Vice President – Technical Research of Prabhudas Lilladher is the latest to recommend buying RIL shares.

In a report dated February 14, Parekh said, RIL stock has witnessed a decent correction from the 2750 levels and has bottomed out near the 2300 zone which is a good support level of the previous low made forming almost a double bottom formation on the daily chart.

She added, “With a decent pullback witnessed the bias has improved with upside potential visible from here on.”

Also, the RSI has indicated strength with a trend reversal from the oversold zone to make the chart look attractive and with the risk-reward favourable, hence Parekh said, “we recommend buying and accumulating this stock with an upside target of 2610 keeping the support of 2275.”

In a recent report, Jefferies said, “RIL stock has corrected 14% since Dec and trades at 18x fwd PE-a discount to its LT avg. This is attractive in view of 18% earnings growth in FY24E. The current stock price imputes zero value to RIL’s renewable business in our view. We expect investors to ascribe meaningful value to renewables when the first revenues are realized in CY24. Reiterate Buy with PT ₹3,100.”

As a base case scenario, Jefferies has estimated a 24% EBITDA CAGR in Jio over FY22-25E, helped by about 473m subscribers at ₹206 ARPU; 35% EBITDA CAGR in Retail over FY22-25E; 11% EBITDA CAGR in refining over FY22-25E; 4% EBITDA CAGR in petchem over FY22-25E.

The brokerage has valued RIL’s renewable business at $28 billion and has noted that the current market price of the stock at ₹2,320.60, as on the close of February 13, implies “little value to the business”.

RIL continues to expand its Jio True 5G services across India. On Tuesday, RIL’s telecom arm Reliance Jio introduced Jio True 5G services in Himachal Pradesh from Shimla. Additionally, the 5G services were simultaneously launched in Hamirpur, Nadaun, and Bilaspur in this state. Now, the total number of cities enjoying Jio True 5G services is to the tune of 257.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.