Reliance Defence Ltd, a wholly owned subsidiary of Reliance Infrastructure Ltd, which is part of the ADAG, applied to the Union ministry of commerce and industry for grant of industrial licences to manufacture a range of defence products in Pithampur.
The Board of Approval for SEZ gave its in-principle approval to the project, subject to certain terms and conditions, at a meeting held in New Delhi on Thursday, sources said.
According to the details mentioned in the application, Reliance Defence Ltd has proposed to manufacture hi-tech equipment, including directed energy weapon, laser for target destruction, high velocity kinetic energy weapon system, and particle beam system for destruction of target.
The firm has proposed to manufacture electronic equipment used for electronic counter measure (ECM) and electronic counter-countermeasure (ECCM), besides heavy weapons (artillery guns, AD guns, mortars, rocket launchers), remotely piloted vehicles (RPVs) and unmanned lighter than air vehicles.
The state government has earmarked 300 acres land for Reliance’s defence park in Pithampur SEZ, but the company will need additional land after forming a joint venture (JV) company with Rafael Advanced Defence Systems. “We are in the process of identifying additional land in Pithampur for Reliance,” a state industry department official told the Hindustan Times.
While the state government had cleared the proposal in January, the project got a fillip earlier this month when Reliance signed an agreement with Israel’s Rafael Advanced Defence Systems for manufacturing air-to-air missiles and other systems in Pithampur.
Though the Sensex fell yesterdasy by more than 200 points tracking subdued regional stock markets as weak China factory data rekindled global growth worries; analysts across the board remains optimistic about the health of the domestic economy after strong auto sales data for April and amid hopes of good monsoon.
However, SP Tulsian of sptulsian.com, took a contrary view and called the current correction a 'classic case of market moving into a bearish zone' and believes that volatility may continue for a couple of sessions.
Reliance Infrastructure saw a Block Deal on BSE, Qty: 137,456, Deal Price: Rs.539.95, Value: Rs.7.42 Cr, on 3 May, 2016.
The shares of Reliance Infrastructure Ltd, having a face value of Rs.10, Book Value of Rs.786.79 and EPS of Rs.64.90 is trading very cheap, as compared to many of its peers. The stock of Reliance Infrastructure Ltd, which closed at Rs.535.90, is still trading above its 200D SMA, which is placed at Rs.435.70.
Buy the shares of Reliance Infrastructure Ltd at Rs.535-537, for a short term target of Rs.580. SL--Rs.527.