Anil D Ambani Reliance Group~Market Cap & Debt ~ Defence to its Defence

Have a Look at the Market Cap (today closing March 28,2016)& Consolidated Debt (September 30,2015) of these Five Listed Companies of Anil D Ambani

Rs 120941 crs was the Aggregate Consolidated Long & Short Term Debt of Anil Ambani’s Reliance Five Listed Group Companies as on September 30,2015 while today’s Market Cap is Rs 53434 crs.Aggregate it and you’ll get Enterprise Value without adjusting for any Cash    

Reliance Defence (erstwhile Pipavav) has come into his fold now and a turnaround is expected after CDR was approved ~ RCom is planning to reduce Debt substantially by selling Assets like it’s Tower Business.It also is being supported by Big Brother Mukesh Ambani’s tie ups for Jio Roll outs etc ~ RPower has just declared and paid it’s maiden interim dividend of 10% in December 2015 but continues to struggle to commission Samalkot Power Plant on non availability of Gas ~ Rinfra & RCap are the relatively stabler companies

As long as his companies keeps servicing debt the Banks who have lend will not have to classify the Loans as NPAs….In fact with Anil Ambani planning huge Defence Sector Investments and Growth in his other Companies the aggregate Debt may increase even after Asset Sell offs

Problem is that Anil Ambani has not been enjoying good Investor Credibility after wealth destruction in RCom & RPower & suspected involvement of top management in the 2G Telecom Scam.Investigation continues

The Group’s Market Cap is Rs 53434 crs ~ Compare this with Big Brother Mukesh Ambani’s Reliance Industries that closed today with a Market Cap of Rs 330654 crs

Now his big Focus is on Defence with India having embarked on a Huge Defence  ‘Make in India’ Endeavour opening out FDI  Cap to 49% in the Sector

None of Anil Ambani’s Companies have approached it’s shareholders or the Public for funds after the Reliance Power IPO at Rs 450  in January 2008

None have as None could !

The Reliance Power IPO was a huge obscene premium assault on the Public from which the Public has yet to recover (Quotes at Rs 47 today after a Bonus Issue in 2008 itself  from the Premium collected that adjusted the Price to @ Rs 270!) .The Issue was hyped by the Investment Banker Wolves to create a huge oversubscription.

Of course in January 2011 Anil Ambani had entered into a Consent Plea with SEBI without admission of guilt & was investigated for misuse of Overseas Borrowed Funds and was personally fined and banned access to Capital Markets for a year and Reliance Infra for two years   

As long as Banks are there to support his Companies ,Anil Ambani does not need direct Monies now from Shareholders & the Public ~  Public Monies are routed through the Banks as Debt in any case.Of Course his Group also runs Reliance Mutual Fund which currently has over Rs 150000 crs of Assets Under Management ….interestingly @ three times Group Market Cap ! ….and Oh! SEBI has just warned Mutual Funds not to make it a habit & come to the rescue of Corporates,especially Group Companies for Funds or they will be penalised !…just bark perhaps !  

Now from Telecom & Power woes his focus has shifted to Defence….Defence to his Defence !….time for resurrection perhaps?

Proof of the Pudding lies in the eating and that would mean the Share Price of his Listed Companies need to entertain & sustain new highs in the coming years ~ his Entertainment Business remains unlisted

The Defence Sector is the Flavour & we read of many listed companies announcing plans to enter it  for their piece of a growing pie ~ HFCL for one !

In the 1980’s the flavour was Leasing ~ in the 1990’s the flavour was IT ~ Millenium brought with it the ICE Age that melted quickly

Now it’s Defence & while I remain an eternal optimist ( Yes ! even for the ADA Group resurrection !) I just pray the Public will not be preyed on only to be rendered defenceless by investing in Defence Companies ! ~ Select  Wisely & Well   

This post was a result of Chairman of Reliance ADA Group,Anil Ambani’s column in today’s Edition of Times of India reproduced verbatim below and where I’ve highlighted in bold a few phrases which I have interpreted as push for fine tuning reforms that would benefit his foray into Defence  :