Edelweiss is bullish on Reliance Industries has recommended buy rating on the stock with a target price of Rs 1407 in its research report dated December 01, 2016.
This exemplifies Reliance Jio’s (RJIO’s) strategy of cross selling various internet-based services via its ecosystem, as highlighted in our note - Reliance Industries - Betting big on integrated play stratagem. We expect RJIO to garner significant data volume market share even when it becomes a paid service. Maintain ‘BUY’ with target price of INR 1,407.
With over 50mn subscribers in less than 3 months, RJIO has grown faster than Facebook, Skype and Whatsapp and exceeding our March 2017 target of 40mn subscribers. We have raised our FY17E end subscriber forecast to 75mn. Following conclusion of RIL’s ongoing mega capex, we expect FCF to turnaround and RoE to rise. We reiterate ‘BUY/SO’, with a SoTP-based TP of INR 1,407, highest on the Street.
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