Reliance’s share price was surging on Thursday morning after the company announced the mega-merger with Disney on Wednesday evening.

What Happened: The conglomerate on Wednesday informed the exchanges inked a deal to merge Viacom18 and Star India into a formidable joint venture. With a valuation pegged at around ₹70,352 crore ($8.5 billion), the JV will see RIL holding a 16.34% stake, while Viacom18 and Disney will have 46.82% and 36.84% respectively.

The RIL-Viacom18-Disney joint venture is set to create India’s largest media empire, encompassing TV broadcasting, streaming, movies, and sports.

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Analyst Reactions: According to Jefferies, this collaboration will bolster RIL’s sum-of-the-parts valuation (SOTP) by ₹40 per share. The research firm noted that the partnership offers opportunities for improved ad inventory monetization and potential reductions in content costs due to decreased competition. The analysts maintained a “buy” rating for the stock with a price target of ₹3,140.

Motilal Oswal also maintained its “buy” rating for the stock with a price target of ₹3,210. The brokerage firm said that the deal strengthens Reliance’s media presence.

Price Action: Reliance’s share price was up 1.23% to trade at ₹2,947.10 shortly after the markets opened on Thursday.

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