RIL leads gains on Nifty 50 after Meta JV; Morgan Stanley sees up to $15 bn AI infra bet

Shares of Nifty 50 heavyweight Reliance Industries Ltd

. (RIL) were among the top gainers on Monday, October 27, rising over 2% after the company announced a joint venture with Meta Platforms to develop enterprise artificial intelligence (AI) solutions.

RIL has formed a new subsidiary, Reliance Enterprise Intelligence Ltd. (REIL), in which it will hold a 70% stake, while Meta will own the remaining 30%.

The partnership involves an initial investment of around ₹855 crore (approximately $97 million). The announcement was made by Mukesh Ambani at the company's Annual General Meeting (AGM).

Brokerage Investec has a 'Buy' rating on RIL, with a price target of ₹1,890 per share.

The brokerage said that REIL represents a key milestone in Reliance's technology-led strategy under its "AI Everywhere for Everyone" vision.

The initiative is built on four pillars — Jio's digital reach, Reliance's green-powered data centres in Jamnagar, strategic global AI partnerships, and in-house AI development — positioning the group at the forefront of India's AI-driven digital transformation.

Meanwhile, Morgan Stanley, which maintains an 'Overweight' rating on RIL with a price target of ₹3,155, estimates that the company could spend $12-15 billion on AI infrastructure to develop a 1GW data centre, underwriting roughly 25% of the capacity on its own.

The brokerage expects an 11% ROCE on the initial investment based on recent token pricing from large language model (LLM) providers and revenue-sharing assumptions.

While Reliance has not disclosed detailed financial projections, Morgan Stanley believes the new entity could command a valuation of at least 2x price-to-book (P/B), in line with global technology peers.

36 out of the 38 analysts that have coverage on the stock have a 'Buy' recommendation, with price targets going up to as high as ₹1,900.