Saudi Aramco consultant might get inducted to Reliance Industries board: HSBC Global Research

Saudi Aramco chairman and Governor of the Kingdom’s wealth fund Public Investment Fund, Yasir Al-Rumayyan, could also be inducted on the board of Reliance Industries Ltd, a precursor to a USD 15 billion deal, experiences mentioned.
An announcement of Al-Rumayyan’s induction on the RIL board or the board of the newly carved oil-to-chemical (O2C) unit might come as early as on the firm’s annual shareholder assembly on June 24.
“RIL’s Annual General Meeting (AGM) has historically been a keenly watched event (previously attended by 3,000 shareholders when held in physical format and last year saw 300,000 concurrent viewers of the virtual AGM across 42 countries and 468 cities) given that it has been one of the top 3 companies by market capitalisation in India, has a large free float and a large public shareholding (more than 3 million non institutional shareholders),” brokerage HSBC Global Research mentioned in a report.
And expectations are already constructed up for the AGM.

“Over the last year, new investors have joined RIL’s digital and retail business at subsidiary level and RIL has formed new partnerships with global players like Google, Facebook, Microsoft, Qualcomm etc. Investors now expect RIL to give direction to these businesses and announce groundbreaking products,” it mentioned, including experiences recommend that it’s going to seemingly announce a brand new smartphone partnered with Google and its pricing.
“There is also expectation of some update on Saudi Aramco deal and speculation that the Chairman of Saudi Aramco may join RIL’s board,” it mentioned.
Both RIL and Saudi Aramco didn’t reply to emails despatched for feedback. An e mail despatched to PIF too remained unanswered. PIF has already picked up a minority stake in Reliance Retail and Jio.
Billionaire Mukesh Ambani had in August 2019 introduced talks for the sale of a 20 per cent stake within the oil-to-chemicals (O2C) enterprise, which contains its twin oil refineries at Jamnagar in Gujarat and petrochemical belongings, to the world’s largest oil exporter.
The deal was to conclude by March 2020 however has been delayed for causes not disclosed by both firm.
Talks have revived this 12 months and the 2 are reportedly discussing a money and share deal – Aramco paying for the stake with its shares initially after which staggered money funds over a number of years.
In a separate report, BofA Securities mentioned RIL’s AGM every year has became a key occasion the place chairman Mukesh Ambani gives extra info on the outlook of key enterprise divisions.
“Historically we have seen major announcements on phones, tariffs, stake-sales etc,” it mentioned.The deal to promote stake in O2C enterprise to Aramco too was introduced at RIL AGM in 2019.
“We expect an update on Jio-Google phone features (like 5G), potentially pricing and timeline,” it mentioned. “Clarity on JioMart/other online commerce businesses along with the JioMart-WhatsApp integration” can be anticipated.
Reports recommend “RIL may announce the appointment of Mr. Yasir Al-Rumayyan, chairman of Saudi Aramco and governor of the kingdom’s wealth fund Public Investment Fund, on its board during AGM,” it mentioned. “RIL may introduce a new affordable laptop to tap into the massive demand for work from home machines.”
Besides refineries and petrochemical vegetation, the O2C enterprise additionally contains a 51 per cent stake within the gas retailing enterprise. It, nevertheless, doesn’t embrace the upstream oil and gasoline producing belongings such because the flagging KG-D6 block within the Bay of Bengal.
RIL had in 2019 put USD 75 billion as the worth of O2C enterprise after signing a non-binding letter of intent with Saudi Aramco.
The agency had just lately introduced carving out the O2C enterprise as a separate subsidiary to assist strategic partnerships and new buyers with a view to speed up its new power and materials plans. Digital enterprise is already held by a subsidiary Jio Platforms and Reliance Retail holds the offline and on-line retail enterprise.
Aramco shopping for 20 per cent in O2C enterprise would permit Reliance to construct monetary muscle because it carves out house for itself in extremely aggressive omnichannel retail.

With a stake, Aramco wouldn’t solely have a stake in one of many world’s finest refineries and largest built-in petrochemical complicated. It has entry to one of many fastest-growing markets, a ready-made marketplace for 5 lakh barrels per day of its Arabian crude and providing a probably larger downstream function in future.
RIL refineries are probably the most complicated on this planet, permitting it to earn a big premium to the benchmark Singapore gross refining margin. Its petrochemical complexes rank among the many largest on this planet, whose dependency on exterior uncooked supplies is minimal. It has management positions each within the home polymer and polyester markets.