If you read the speech of Mukesh Ambani in the 43rd AGM, he had hinted that the deal with Aramco had only been stalled. That is more due to pricing and valuation differences. It needs to be remembered that the deal was struck when the oil prices were buoyant at around $75/bbl. However, due to COVID-19, the oil prices have fallen to $40/bbl.

Aramco is looking at 20% lower valuation compared to their discussion last year to reflect lower crude prices and lower GRMs. In fact, currently GRMs are negative. However, RIL is not keen to renegotiate the price or the debt levels. Reliance is in a comfortable situation as it is currently not dependent on Aramco deal for becoming zero debt, post Jio stake sale.

Looking ahead, the deal will probably go through after the O2C business is hived off into a separate entity. Over the last 6 years, the cash flows of the O2C business have been used to drive the digital business. At some point in the future, RIL will look to monetize the value of its O2C business too but that will obviously be done at a more favorable oil price situation.