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Reliance to hold 44th AGM today; deal with Aramco, 5G technology on the agenda
According to a report by HSBC Global Research, Reliance Industries’ AGM has historically been a keenly watched event, given that it has been one of the top three companies by market capitalization in India and has a large free float and a large public shareholding.
Reliance Industries Ltd (RIL) will be holding its 44th annual general meeting (AGM) on Thursday where some major announcements are expected to be made. The meeting will be held virtually for a second consecutive time due to the ongoing coronavirus disease (Covid-19) pandemic.
According to a report by HSBC Global Research, Reliance Industries’ AGM has historically been a keenly watched event, given that it has been one of the top three companies by market capitalization in India and has a large free float and a large public shareholding. Meanwhile, BofA Securities said in its report that the AGM has turned into a key even where chairman Mukesh Ambani provides more details on the outlook of RIL’s key business divisions
This time the major announcements, which investors and shareholders are keen on, are the 20% stake sale in the company’s oil to chemical business (O2C) to petroleum giant Saudi Aramco and the rollout of 5G technology in India.
It is very likely that Saudi Aramco’s chairman Al-Rumayyan might be inducted on the board of RIL. Al-Rumayyan is also serving as the governor of Saudi Arabia’s wealth fund Public Investment Fund.
Also Read| Reliance AGM: Will Aramco chairman join RIL board? Decision expected today
In August 2019, Mukesh Ambani announced talks for the sale of a 20 per cent stake in the O2C business, which comprises RIL’s refineries at Jamnagar in Gujarat and petrochemical assets, to Saudi Aramco. The deal was supposed to conclude by March last year but it was delayed and both companies have not disclosed the reason.
According to news agency PTI, Aramco buying a 20 per cent stake in RIL’s O2C business would allow the latter to build financial muscle. And Aramco will not only have a stake in one of the world’s best refineries and largest integrated petrochemical complex, but it will also have access to one of the fastest growing markets, a ready-made market for 500,000 barrels per day of its crude and also offering a potentially bigger downstream role in future, PTI further reported.
Also Read| How Reliance stock performed on AGM day in last 5 years
Reliance Jio has partnered with Google to develop the software for its upcoming 5G phone, which will be cheap enough to bring in a massive number of users of 2G phones in India. Livemint reported on Wednesday that the 5G phone might be cheaper than some of the 4G phones. The price of the phone might be between ₹4,000-5,000 but there is no official confirmation yet.
“We expect an update on Jio-Google phone features (like 5G), potentially pricing and timeline,” BofA Securities said in its report, adding a clarity on JioMart and other commerce businesses along with the JioMart-WhatsApp integration is also expected.
