RPL a BUY or SELL ?
RPL a BUY or SELL ?
Should one take a long-term bet on Reliance Industries shares or punt on World's top 10 oil producers
World's largest refining cos
Reliance Petroleum shares for arbitrage opportunities that World's top 10 oil producers
World's largest refining cos
may be available till the
record date is announced? That is the question that Dalal Street players were asking each other after the two companies informed the stock exchanges, post market hours, that they
were considering a merger proposal.
While the swap ratio is yet to be announced, it is widely felt that the ratio will be in favour of RIL shareholders. This is based on the simple arithmetic that there are more minority shareholders in RIL than in Reliance Petroleum.
Independent investment advisor SP Tulsian feels the merger is “slightly negative” for RPL while only “mildly positive” for Reliance Industries.
“I think the swap ratio would be around 20:1 or 24:1,” he adds. Mr Tulsian expects RPL shares to drop to around Rs 70 on Monday. On Friday, RPL shares closed 1.2% lower at Rs 76.20. The shares have fallen 5% over the past one month. Some brokers say the timing of the proposal also indicates that RIL shareholders’ interests have been given priority.
“Had the merger been proposed when RPL shares were near their record highs, the merger ratio would have been 10:1 or 12:1,” (RIL share price was around 10 times the RPL share price at that point) said a fund manager who did not wish to be named.
Life Insurance Corporation and Fidelity Shares are the major institutional investors in Reliance Petroleum, holding 2.06% and 1.67%, respectively.
In a similar context, KRIS director Arun Kejriwal says that RIL would “benefit more” from the swap ratio as it is a “longstanding company and has large reserves.”
“One needs to keep in mind that RIL is also the holding company for other Mukesh Ambani entities,” he adds.
Some analysts feel the merger proposal may be the first of a series of restructuring moves likely in the Reliance group.
http://economictimes.indiatimes.com/articleshow/4203031.cms
RPL a BUY or SELL ?
Should one take a long-term bet on Reliance Industries shares or punt on World's top 10 oil producers
World's largest refining cos
Reliance Petroleum shares for arbitrage opportunities that World's top 10 oil producers
World's largest refining cos
may be available till the
record date is announced? That is the question that Dalal Street players were asking each other after the two companies informed the stock exchanges, post market hours, that they
were considering a merger proposal.
While the swap ratio is yet to be announced, it is widely felt that the ratio will be in favour of RIL shareholders. This is based on the simple arithmetic that there are more minority shareholders in RIL than in Reliance Petroleum.
Independent investment advisor SP Tulsian feels the merger is “slightly negative” for RPL while only “mildly positive” for Reliance Industries.
“I think the swap ratio would be around 20:1 or 24:1,” he adds. Mr Tulsian expects RPL shares to drop to around Rs 70 on Monday. On Friday, RPL shares closed 1.2% lower at Rs 76.20. The shares have fallen 5% over the past one month. Some brokers say the timing of the proposal also indicates that RIL shareholders’ interests have been given priority.
“Had the merger been proposed when RPL shares were near their record highs, the merger ratio would have been 10:1 or 12:1,” (RIL share price was around 10 times the RPL share price at that point) said a fund manager who did not wish to be named.
Life Insurance Corporation and Fidelity Shares are the major institutional investors in Reliance Petroleum, holding 2.06% and 1.67%, respectively.
In a similar context, KRIS director Arun Kejriwal says that RIL would “benefit more” from the swap ratio as it is a “longstanding company and has large reserves.”
“One needs to keep in mind that RIL is also the holding company for other Mukesh Ambani entities,” he adds.
Some analysts feel the merger proposal may be the first of a series of restructuring moves likely in the Reliance group.
http://economictimes.indiatimes.com/articleshow/4203031.cms
This i say the power of charting 
