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"My
father maintained that what was good for India was good for
Reliance. Today, I think what is good for India is
good for the rest of the world."
Mukesh Ambani
Chairman, RPL |
The
rebirth of Reliance Petroleum Ltd (RPL) it was in many ways. Last
fortnight, when Mukesh Ambani listed his export-oriented refinery
project at Jamnagar on the exchanges, under the banner of RPL-a
public issue from the Reliance stable after 14 years-there was
a strong scent of nostalgia at Jeejeebhoy Towers, the headquarters
of The Stock Exchange, Mumbai (BSE, once known as the Bombay Stock
Exchange). For, 1992 was the first time RPL stormed the capital
markets with a public issue priced at Rs 60 (this was at Rs 60
per TOFCD-Triple Option Fully Convertible Debenture). The project
at that time of course was a nine million tonne refinery at Jamnagar.
Today, the capacity is 30 million tonnes and it will be doubled
to 60 million tonnes by 2009-10. Over the years, RPL was merged
into flagship Reliance Industries Ltd (RIL), at a 1:11 ratio,
and subscribers to the RPL shares became RIL shareholders.
It's too early to say whether history will
eventually repeat itself, but the way the RPL stock opened at
listing would have RIL investors licking their chops in anticipation
of a merger with the flagship some time down the line. The Rs
27,000 crore project itself is expected to come on stream only
by end-2008. The stock, though, is already on fire, opening on
listing day at Rs 101.95, translating into a gargantuan 70 per
cent premium over the offer price of Rs 60. The RPL scrip ended
the day lower, at Rs 85.45, even as the broader market stumbled
by 177 points. At a stroke, the Reliance group's market cap moves
into the Rs 2 lakh crore bracket, with RPL contributing nearly
Rs 40,000 crore. Chairman Mukesh Ambani, for his part, is richer
by a cool Rs 12,451 crore based on his 32.38 per cent stake, through
the direct and indirect route, in RPL (based on the market capitalisation
of Rs 38,452.5 crore at the end of listing day).
Ambani would be even richer if you consider
the movement of the RIL stock in tandem with RPL (RIL has a 75
per cent stake in RPL). Since last May, the RIL price has doubled,
and in seven trading sessions between April 12 and 21, the stock
had raced a little over 20 per cent to Rs 1,000, and subseque |
