RIL gains 4 per cent as Lyondell buyout unlikely | business | Hindustan Times
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RIL gains 4 per cent as Lyondell buyout unlikely

business Updated: Mar 03, 2010 20:56 IST

PTI
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Reliance Industries rallied 4 per cent on the news that LyondellBasell rejected its takeover bid as investors were relieved that it was not overpaying for acquiring the bankrupt American chemicals maker.

After surging to 4.16 per cent in mid-session, RIL shares closed for the day up Rs 38 or 3.90 per cent at Rs 1,021.95 on the Bombay Stock Exchange.

Analysts said investors are happy that the concerns of over-payment for acquiring LyondellBasell is now over.

"The acquisition would not add to the profitability of RIL as LB is a downstream company. Now investors are convinced that RIL is not going ahead with the bid," research analyst at Angel Broking Deepak Pareek said.

At the end of day's trade, the market capitalisation of the country's most valued firm stood at Rs 3.34 lakh crore, making RIL investors richer by over Rs 12,000 crore in a single day.

Meanwhile, India Infoline's Prayesh Jain said even if RIL increases the bid it will not go beyond USD16 billion.

"The investors were relieved that RIL is not getting into a bidding war which would have stretched the deal valuation."

"RIL might now focus on the Canadian Value Creation, an upstream company and would add to its long-term profitability," Pareek said.