RIL’s green transition to be value-accretive, see stock at Rs3,100: Jefferies
With adequately-funded balance sheet, low leverage and strong OCF positions, Reliance Industries is a buy, Jefferies said reiterating the target price of ₹3,100 as a base case scenario.
The brokerage said the recent fall in share price of Reliance Industries makes it attractive. In January, the global brokerage firm had said it sees potential earnings upside from RIL’s O2C, putting the target at ₹3,100.
“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,” said Jefferies in a recent report.
Jefferies 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 close of February 13, implies “little value to the business”.
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Ganesh
http://ganesh@finplay.inFinance enthusiast, Mutual fund expert.