Standard Chartered downgraded Reliance Communications rating to 'underperform' from 'in-line'. It feels that the risks from the tower sharing deal exist from the pace of the ramp-up.
Standard Chartered downgrades Reliance Communications rating to "underperform" from "in-line", saying current valuations "fully reflect the upside from the optic fiber and tower deals."
The Ambani brothers signed a long-expected pact on Friday for their rival telecoms firms to share mobile masts in a contract valued at more than USD 2 billion over several years -- the biggest deal between them since reconciliation.
Also read: RIL, RComm strike Rs 12,000cr tower pact
Standard Chartered says the Reliance Jio tower deal may add 17-22 rupees per share to Reliance Communications' valuations, although risks exist from the pace of the ramp-up.
Reliance Communications' shares have gained 50 percent in 2013 so far compared to India's benchmark index which was flat in the same period.
Reliance Comm stock price
On August 28, 2014, at 13:04 hrs Reliance Communications was quoting at Rs 115.50, down Rs 0.7, or 0.6 percent. The 52-week high of the share was Rs 164.45 and the 52-week low was Rs 105.80.
The company's trailing 12-month (TTM) EPS was at Rs 1.76 per share as per the quarter ended June 2014. The stock's price-to-earnings (P/E) ratio was 65.63. The latest book value of the company is Rs 141.70 per share. At current value, the price-to-book value of the company is 0.82.
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