Is Rio Tinto Plc RIO stock halal to invest in?

Rio Tinto plc is a leading global mining and metals corporation, known for its extensive operations in the extraction of minerals, including iron ore, aluminum, copper, and diamonds. The company's primary function is to supply raw materials that are essential for industries worldwide, playing a crucial role in the global supply chain. Rio Tinto's operations span several countries, involving a diverse range of mining, smelting, and refining processes. For Muslim investors, though, the most pressing question is simpler: is Bodegas Riojanas a Halal investment?

Is Bodegas Riojanas Shariah compliant?

Extracting and selling oil, gas or materials is a permissible business, so companies like Bodegas Riojanas rarely stumble on the activity screen. The pressure point is capital structure: energy is a capital hungry industry that borrows heavily, and AAOIFI Shariah Standard No. 21 caps interest bearing debt at 30% of market capitalisation, a line that moves as commodity cycles move the share price.

Does Bodegas Riojanas pass the business activity test?

The activity screen is only part of the picture this month: Bodegas Riojanas currently fails the non-permissible income and interest-bearing debt screens, so the overall verdict is not compliant regardless of the business itself. The activity itself, extracting and selling resources, raises no Shariah objection; the scrutiny belongs to the financing.

Is Bodegas Riojanas' income Halal?

No. Bodegas Riojanas' income from impermissible sources currently exceeds AAOIFI's 5% revenue ceiling, which makes the stock non-compliant on this screen regardless of the others. The screen is reassessed monthly, so the status can change when new financial statements arrive.

Does Bodegas Riojanas meet AAOIFI's debt and investment ratio requirements?

Not in full. Interest bearing debt currently exceeds the 30% cap, while the other ratio stays within it. One breach is enough to fail the screening; the ratios are reassessed monthly under our Shariah Supervisory Board.

Tabadulat is an ADGM regulated brokerage whose license covers Shari'a Compliant Regulated Activities, as the FSRA permission names them. New to the terminology? Gharar and Maysir, Sukuk, Zakat and purification are all explained in plain English.

New to the four screens? Read AAOIFI Standards Explained: What Makes a Stock Halal?