Reliance Industries Ltd (RIL), led by billionaire Mukesh Ambani, traded flat in early deals on Monday despite announcing the acquisition of oncology-focused technology platform Karkinos Healthcare for ₹375 crore. The acquisition was executed through RIL’s wholly-owned subsidiary, Reliance Strategic Business Ventures Ltd (RSBVL), in an all-cash transaction.
Stock Performance and Market Reaction
RIL’s stock was priced at ₹1214.80 during early trading, reflecting a 0.50% decline from its previous close of ₹1220.95 on the Bombay Stock Exchange (BSE). Year-to-date, the stock has seen a decline of 6.10%, though over the past three years, it has provided an 11.52% return to investors. RIL’s market capitalization slipped to ₹16.45 lakh crore as of Monday, with a total of 8,302 shares changing hands, resulting in a turnover of ₹1.01 crore.
From a technical analysis perspective, the stock is currently neither oversold nor overbought, with its Relative Strength Index (RSI) standing at 37.1. However, RIL shares are trading below all significant moving averages, including the 5-day, 10-day, 20-day, 30-day, 50-day, 100-day, 150-day, and 200-day averages. This indicates bearish sentiment. Additionally, the stock’s beta of 1.2 signals high volatility over the past year.
Acquisition Details and Share Allotment
On December 27, 2024, RSBVL subscribed to and was allotted 10 million equity shares of ₹10 each, amounting to ₹10 crore, alongside 365 million optionally fully convertible debentures (OFCDs) valued at ₹10 each, totaling ₹365 crore. This brings the total investment to ₹375 crore.
In line with the approved resolution plan, Karkinos Healthcare canceled 30,075 outstanding equity shares held by its previous shareholders. As a result, Karkinos became a step-down wholly-owned subsidiary of Reliance Industries following the transaction.
About Karkinos Healthcare
Founded on July 24, 2020, Karkinos Healthcare is a pioneering oncology platform that leverages technology to drive early detection, diagnosis, and management of cancer. The company reported a turnover of approximately ₹22 crore in the fiscal year 2022-23.
Karkinos is committed to delivering comprehensive cancer care services, from diagnostics to radiation therapy, at a significantly lower cost compared to prevailing market rates, while maintaining profitability. The company has partnered with around 60 hospitals as of December 2023 to provide oncology services.
Additionally, Karkinos is establishing a 150-bed multispecialty cancer hospital in Imphal, Manipur, through one of its subsidiaries. Moving forward, the company’s revenue streams will come from multiple channels, including:
- Advanced Cancer Care Diagnostics and Research (ACCDR)
- Distributed Cancer Care Network (DCCN)
- Corporate tie-ups for early cancer detection
- Cancer care hospitals
Strategic Importance of the Acquisition
Reliance Industries highlighted that this acquisition aligns with the company’s broader objective to expand its healthcare services portfolio. By integrating Karkinos’ innovative oncology solutions into its ecosystem, Reliance aims to scale up its offerings in the health-tech sector and extend advanced cancer care across India.
Investor and Stakeholder Background
Before the acquisition, Karkinos had several prominent investors, including:
- Ewart Investments Ltd. – A 100% subsidiary of Tata Sons
- Reliance Digital Health Ltd. – A subsidiary of Reliance Industries
- Mayo Clinic (US)
- Sundar Raman – Director at Reliance Foundation Youth Sports and former COO of the Indian Premier League (IPL)
- Ravi Kant – Former Managing Director of Tata Motors
Regulatory and Legal Approvals
The acquisition was facilitated under the Corporate Insolvency Resolution Process (CIRP) as part of the Insolvency and Bankruptcy Code (IBC) 2016. The National Company Law Tribunal (NCLT), Mumbai Bench, approved the resolution plan submitted by RSBVL on December 10, 2024. No additional governmental or regulatory clearances were required to finalize the transaction.
Source of Information:- https://health.economictimes.indiatimes.com/news/industry/reliance-acquires-karkinos-healthcare-for-rs-375-crore/116738666
