Reliance Infrastructure rose 1.66% to Rs 531.45 at 14:25 IST on BSE after the company said that its wholly owned subsidiary, Reliance Defence has entered into strategic relationship with Rafael Advanced Defence Systems.
The announcement was made during market hours today, 29 March 2016.Meanwhile, the BSE Sensex was up 1.38 points, or 0.01%, to 24,967.78.
On BSE, so far 2.29 lakh shares were traded in the counter, compared with an average volume of 8.09 lakh shares in the past one quarter. The stock hit a high of Rs 532 and a low of Rs 520.50 so far during the day. The stock hit a 52-week high of Rs 622.05 on 5 January 2016. The stock hit a 52-week low of Rs 282.20 on 25 August 2015. The stock had outperformed the market over the past one month till 28 March 2016, gaining 27.45% compared with the Sensex's 7.83% rise. The scrip had also outperformed the market in past one quarter, gaining 6.46% as against Sensex's 4.1% fall.
The large-cap company has an equity capital of Rs 262.99 crore. Face value per share is Rs 10.
Reliance Infrastructure said that Reliance Defence, a wholly owned subsidiary of the company and Rafael Advanced Defence Systems have decided to set up a joint venture company in India in the highly specialized areas of air to air missiles, air defence systems and large aerostats.
Reliance Rafael joint venture will have 51% holding from Reliance Defence and 49% by Rafael as per the current guidelines of the Government of India. The joint venture company will be located at Pithampur, Indore in the state of Madhya Pradesh and will generate more than 3000 highly skilled jobs. The project will have an initial capital outlay of more than Rs 1300 crore, without including the cost of technology. Based on the current requirements, the joint venture company will address multiple programs valued at more than Rs 65000 crore over the next ten years.
The two companies, through the joint venture, will offer the entire range of products in air to air missiles, air defence systems and large aerostats fields to the Indian Armed Forces. Rafael is also willing to offer solutions through the joint venture company even for the ongoing "Buy Global" programs where it is currently competing, in line with "Make in India" initiatives of the Indian Government.
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The joint venture will provide big thrust into the field of indigenous production and development of high precision and state of the art weapon systems in India. The strategic partnership with technology power house and one of the world leaders in Defence Technologies, Rafael Advanced Defence Systems of Israel will mark the entry of Reliance Defence in the complex field of air to air missiles and air defence systems manufacturing in India.
Reliance Infrastructure's consolidated net profit rose 2.3% to Rs 462.67 crore on 10.6% decline in net sales to Rs 3877.98 crore in Q3 December 2015 over Q3 December 2014.
Reliance Infrastructure (RInfra) is one of the largest infrastructure companies, developing projects through various Special Purpose Vehicles (SPVs) in several high growth sectors within the infrastructure space such as power, roads, metro rail, cement and defence. RInfra is also a leading utility company having presence across the value chain of power businesses i.e. generation, transmission, distribution and power trading. RInfra also provides engineering, procurement and construction (EPC) services for developing power and road projects. RInfra has recently entered into the defence sector.
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