Major indices of the Indian stock market opened with losses for the fifth consecutive session, as crude oil prices and US bond yields remained high. Within minutes of market opening on Monday, the Nifty 50 index opened at 22,524 and fell to a low of 22,387. The BSE Sensex opened lower at 72,990 and touched a low of 72,514. However, both indices saw a strong recovery after buying lows (fishing the bottom). Amidst this decline, Reliance Industries shares on the NSE traded at Rs. fell to a low of 1,174.50. However, major stocks Nifty and Sensex soon returned to buying and were in the green.

3 Top Reasons to Buy Reliance Industries Shares

Shares of Reliance Industries Limited (RIL) are under pressure due to weak trend on Dalal Street, according to stock market experts. He says the company’s fundamentals are very strong. Amid the ongoing crisis in the Middle East and rising crude oil prices, there is a need for the best oil refiner companies and RIL fits perfectly into this category. US Secretary of State Marco Rubio’s meeting with Mukesh Ambani should be viewed from this perspective.

Unlocking the value of Reliance’s ‘Jio platforms’ will also benefit RIL, as it holds nearly two-thirds of the company’s share capital, experts said. A third reason to buy Reliance shares amid the current decline in the Indian stock market, experts said, is that the US-Iran war has pushed up crude oil prices, but also higher diesel prices. RIL exports diesel, so hopefully it will benefit from this as well.

Marco Rubio meets Mukesh Ambani

Regarding the meeting between US Secretary of State Marco Rubio and Mukesh Ambani, Avinash Gorakshkar, founder of ‘Avinash Mentor Research’, said in a Mint report that although there is no official confirmation yet, it is believed that the meeting between Marco Rubio and Mukesh Ambani may discuss the refining business.

In fact, due to the long-running US-Iran conflict, many refineries in the Middle East have shut down. After regime change in Venezuela, crude oil production there is expected to increase from the current 1 million barrels per day to about 2.5 million barrels per day. However, Venezuelan crude oil is highly concentrated, which only a few refineries can process.

Reliance Industries (RIL) is one of them. Reliance Industries is already refining imported ‘Ural crude oil’ from Russia, which is similar to Venezuelan crude. Gorakshkar said that like Russia, the market is giving a kind of discount to RIL for Venezuelan crude oil. This will further strengthen RIL’s refining business, further improving the company’s balance sheet.

Boost export business

Pointing to an important aspect behind rising crude oil prices, SEBI-registered market expert Anuj Gupta said in a Mint report that when the US-Iran war broke out, Brent crude oil was priced at $72 per barrel and diesel was around $110 per barrel in the international market.

Today, almost eight months after the US-Iran war, Brent crude oil prices have risen to around $115 per barrel, while diesel prices have reached $200 per barrel. Thus, the difference between the prices of crude oil and diesel has increased from $ 38 per barrel to almost $ 90 per barrel. This has led to a boom in the business of oil marketing companies (OMCs) and oil refineries, but no one is talking about this amid the noise of rising crude oil prices.

On how Reliance Industries could benefit from this wide gap between crude oil and diesel prices in the international market, he said $100 per barrel has now become the ‘new normal’ for the markets and RIL is a major exporter of diesel in the international market. He said that after the Russia-Ukraine war, there has been a major change in Reliance Industries’ diesel and refined fuel export business. The company has now started making its way between Western sanctions, diplomatic ties with the US and changing global trade routes, instead of seeking early profits (arbitrage margins) from cheap Russian crude.

After the Russia-Ukraine war broke out in 2022, Reliance’s two Jamnagar (Gujarat)-based refineries took advantage of Russian ‘Ural’ crude oil being available at a deep discount. They postponed maintenance work to maximize production of their refineries and boost exports of diesel, jet fuel and gasoline to energy-hungry international markets.

Benefits of Reliance Jio Platforms’ ‘Value Unlock’

Avinash Gorakshkar said in a media report that the market is expected to benefit from ‘value unlock’ for RIL, as it has about one-third stake in Reliance Jio Platforms. So, this rise in RIL shares is attributed to the start of subscription to the Jio platform IPO.

On how the Jio platform IPO can be linked to Reliance Industries shares, Avinash Gorakshkar said that even after ‘value unlocking’ from RIL, the balance sheets of the two companies will remain linked, as RIL still holds two-thirds stake. The good financial performance of the company will continue to be reflected in RIL’s balance sheet.

Hoping that the rally will continue due to ‘value unlock’, Avinash Gorakshkar said, “The market estimates that due to ‘value unlock’, RIL shares may rise by around ₹350 to ₹500 per share. However, this will largely depend on how the Jio Platforms IPO listing goes.

Talking about the listing price of Jio Platforms IPO, Avinash Gorakhskar said that the market expects the listing price of Jio Platforms IPO to be between Rs 1350 to Rs 1400, which will depend on the market mood. It is believed that this premium will be added to RIL’s shares. Jio Platforms IPO Price Band Rs. 1,065 to Rs. is 1,119.

Hence, the listing price of Jio Platforms IPO is Rs. 1350 to Rs. 1400 means that Reliance shares in the short to medium term will be Rs. 250 to Rs. 300 per share may increase. However, by the end of the current financial year, RIL’s share price was Rs. 1,550 to Rs. 1,700, depending on the market mood in the last quarter of the current fiscal.

Price target for shares of Reliance Industries

Analyzing the technical chart of Reliance shares, Mahesh M., Vice President (VP) of Research and Business Development at KC Securities. Ojha said in a Mint report that the shares of Reliance Industries were Rs. The 1,145 level has formed a strong base. Share Rs. 1,200 level and now Rs. Moving towards a short-term target of 1,265. Existing shareholders and new buyers Rs. 1,145 with a tight stop-loss and short term Rs. 1,265, Rs. 1,290 and Rs. 1,350 can invest in it with a target.