The first day when Reliance Industries -- Rights Entitlement (RIL-RE) issue opened today, the online trading in RIL-RE reached high volumes with buyers outpacing sellers and the price soaring.
According to sources, RIL-RE issue became the first issue where eligible shareholders got the rights entitlements (REs) in demat, which could be traded on stock exchanges. Reliance RE price soared 39.5 per cent to Rs 212 on the National Stock Exchange (NSE)
Sources said that Reliance RE had more volumes than the RIL share itself. Throughout the day, Reliance RE traded at a premium to its intrinsic value - or the difference between RIL's CMP and the Rights Issue price of Rs 1,257. This shows great demand for RIL's REs in the secondary market. This also shows that REs have created great value for RIL shareholders.
The details regarding traded volume are: NSE recorded 2.92 crore volume with a traded value of Rs 537.1 crore. BSE recorded 27.4 lakh volume with a traded value of Rs 51.8 crore. Together nearly 3.2 crore Reliance REs were traded on both the stock exchanges together worth Rs 588.9 crore.
Sources said the traded volume in RIL REs on the debut day of 3.2 crore was greater than the share of Reliance Industries -- 2.55 crore RIL shares exchanged hands on the NSE and 9.08 lakh on BSE, totalling 2.64 crore.
The details regarding price are -- the price of Reliance RE, which debuted at Rs 158.05, reached a peak of Rs 212 by end of the day on NSE - just below the daily circuit limit of Rs 212.65. This marked a gain of 39.5 per cent. The gain was greater than the increase in RIL share of 2.02 per cent with a closing price of Rs 1,437.40, said sources.
Reliance REs traded at a premium to their intrinsic value - or the difference between RIL's share price and the Rights Issue price of Rs 1,257. At market close, the RE traded at Rs 212 and RIL share traded at Rs 1,437.40, which is at a differential of Rs 180.4 over Rs 1,257.
This premium is generated because of the 18-month period RIL has given to the eligible shareholders to pay for the rights shares. A premium to the intrinsic value indicates a strong conviction in RIL's future course of performance.
Sources said total market capitalisation of the Reliance REs was Rs 8,960 crore, which is the total value the REs have created for RIL's shareholders.
( With inputs from ANI )