Reliance Industries: According to a media rumor, ADIA is considering a $600 million investment in the Mukesh-Ambani retail company, which might be valued much more than at an earlier closed round three years ago.
In light of a media story that said existing investor Abu Dhabi Investment Authority (ADIA), a Gulf sovereign fund, was looking to acquire more stock in the oil-to-telecom major’s retail unit Reliance Retail Ventures (RRVL), shares of Reliance Industries Ltd. will be in the spotlight on Wednesday. Weeks prior, a report said that Reliance Retail was in talks for a combined $1.5 billion in new investments with current investors like the sovereign wealth funds of Saudi Arabia, Abu Dhabi, and Singapore.
According to a story in the ET today, ADIA is interested in a share in the Mukesh-Ambani retail company valued at $600 million, which will, according to ADIA, be much greater than it was in the previously finished round three years ago. The previous round of funding by RRVL in 2020 was Rs 47,265 crore and was completed at a pre-money equity valuation of Rs 4.21 lakh crore.
ADIA currently owns a 1.2% stake in RRVL. According to the ET article, the current valuation is around 60% greater than the previous round but lower than the $131 billion street expectation.
A wholly-owned subsidiary of the Qatar Investment Authority made an investment in RRVL last month totaling Rs 8,278 crore, giving the company a pre-money equity value of Rs 8.278 lakh crore. On a fully diluted basis, QIA’s investment resulted in a minority interest of 0.99 percent in RRVL. Additionally, investment company KKR increased its stake in RRVL to 1.42 percent by investing Rs 2,070 crore through an affiliate. The pre-money equity value assigned to RRVL by that investment was Rs 8.36 lakh crore.
Reliance Industries stock has lost 1.49 percent of its value so far this year. In contrast, the BSE Sensex rose 7.81% over the same time period.
According to Motilal Oswal Securities, the RRVL’s enterprise value is Rs 8.6 lakh crore and its equity per share value is Rs 1,200, with an estimated net debt of Rs 33,200 crore in FY25.
Reliance Industries had previously stated that it would share more information as soon as it became available and that a number of prestigious financial and international strategic investors had expressed interest in the retail industry.
