Why reliance stocks fall
Why reliance stocks fall
Reliance Industries Ltd (NS:RELI) made some major announcements at its annual general meeting (AGM) on June 24. However, the market has given a muted reaction and the stock is trading at Rs 2,106, down 2.18% today, after falling 2.61% yesterday.
Experts say there are three main reasons why markets have not had a positive reaction to the announcements and why RIL stock is down:
- RIL-Aramco valuation: When RIL had first spoken about the possibility of a deal where it would sell 20% in its O2C (oil to chemical) business to Saudi Aramco (SE:2222), the value of the business was pegged at $75 billion. There are media reports that the deal which is expected to close in 2021 will see Aramco pick up a 15% stake for $20 billion but there was no confirmation from RIL on the numbers.
- No details on Jio and Retail listing: The AGM didn’t cast any light on the listing dates or plans for Reliance Jio and Reliance Retail. Edelweiss Securities has a target of Rs 2,105 on the stock, and it has hit it today.
- Long gestation period for green business: RIL has announced a capex of Rs 75,000 for its green and renewables energy business. This is the start of a new large, long-gestation business and it is bound to hurt RIL in the short term.
POOR PEOPLE SPEND, SMART PEOPLE INVEST
INVEST VIA : ZERODHA THE LARGEST RETAIL BROKER
Comments
Post a Comment