Aditya Birla Group's capitalisation value jumps up & crosses $100 billion record

On Friday (May 24), the Aditya Birla Group witnessed a significant milestone as its market capitalisation exceeded $100 billion for the first time. Over the course of the past year, the conglomerate's affiliated companies contributed nearly $40 billion to this remarkable achievement.

Four companies within the group, namely Vodafone Idea, Century Textiles and Industries, Pilani Investment and Industries, and Aditya Birla Money, have experienced a significant increase in their stock prices, more than doubling in the past year. Additionally, Vodafone Idea's market valuation surpassed Rs.1 lakh crore on Friday. Based on Bloomberg data, as of the close of trading on Friday, the collective market valuation of the group reached $102.3 billion. 

Ultra Tech, the cement manufacturer, holds the first position on the list with a market capitalisation of almost Rs.3 lakh crore. Following closely is Grasim Industries, with a market valuation of Rs.1.63 lakh crore. Notably, Grasim Industries has experienced a significant growth in market capitalisation, doubling to nearly $20 billion over the past three years. This remarkable achievement can be attributed to their successful incubation and expansion of new high-growth engines.

The conglomerate supported by Kumar Mangalam Birla has made headlines by entering the paint industry and executing a turnaround plan for its telecom division - Vodafone Idea. In order to revive the telecom sector, the company plans to keep its high-end customers while enhancing its online presence with a strong emphasis on premium services. Moreover, investors have shown increased optimism towards the company, particularly following its successful follow-up on the public offering (FPO).

UBS has raised Vodafone Idea's rating from "Neutral" to "Buy" and set a twelve-month target price of Rs.18, up from the previous target of Rs.13.10. UBS believes that Vodafone Idea will see significant value creation through relief on government dues, with more potential upside compared to Airtel.

Moreover, industry experts anticipate a potential decrease in AGR by the Supreme Court or the implementation of measures such as equity conversion and government-imposed moratoriums in the foreseeable future. Under these circumstances, the company would find the risk-reward ratio appealing.

The Birla Group, ranked among the top ten conglomerates in the nation, operates across multiple industries including cement, metals, fashion and retail, financial services, telecom, cement, and paints. With a remarkable 57% return in the past year, the group has surpassed the Nifty50 benchmark, which saw a 24% increase over the same period.