RIL scales uncharted highs- Jio Dhan Dhana Dhan
“On a day when the Nifty decisively settled above the 10,000 mark, RIL marked a life time high. At a market cap of over Rs.530,000 crore, it is also the most valuable company in India. After a gap of nearly 10 years, RIL has finally broken the previous high that it had made in January 2008 at the peak of the sub-prime crisis.
RIL has singularly driven the Nifty rally from 8,000 to 10,000. Two key factors have driven this rally. The first is RIL’s ability to consistently maintain its Gross Refining Margins (GRM) in the $11-12/bbl range, which gives RIL an advantage of nearly $4-5 over the Singapore GRM benchmark. This GRM was possible due to its integrated model extending from extraction to refining to downstream products like petrochemicals. Petchem margins have also remained globally competitive.
But the real disruption has come on the telecom front. Since Jio was launched in September 2016, the stock price has nearly doubled. The reasons are not far to seek. Its data-heavy pricing model has quelled competition and also ensured superior ARPUs. The cutting edge could come from the launch of Jio phones which will allow RIL to own the entire data ecosystem. That is surely one more step towards the $100 billion market cap target.”