The Hindu Business Line : Reliance Capital outperforms other group company stocks

RELIANCE Capital has become the most fancied company among market players ever since the settlement among the Ambani brothers was announced last week.

This is seen from the sharp rise in the price and trading volume in the stock.

In the last one week, the stock has gained 45 per cent and over a month the gain has been 80 per cent. In today's trading, it closed at Rs 341.1, up 10.69 per cent on the BSE.

Compared to this, stocks such as Reliance Industries, Reliance Energy, Reliance Industrial & Infrastructure, and IPCL have not gained as much.

The volume in the counter has also seen sharp rise - an indication of huge investors interest.

For instance, the stock of Reliance Capital was the most actively traded both on the BSE and the NSE on Friday.

It recorded a turnover of Rs 889.95 crore on the NSE with volume of 2.69 crore shares; on the BSE, the turnover was Rs 428.91 crore with volume of 1.29 crore shares.

However, delivery ratio was very low - just 3.57 per cent and 5.34 per cent on the BSE and the NSE, respectively.

According to brokers, the interest in Reliance Capital has started in anticipation that it would be an investment vehicle for Anil D Ambani Enterprises in future, similar to Reliance Industries in the past for most of the ventures.

Moreover, the view in the market is that this company would show immediate results in terms of performance while other ventures such as Reliance Energy and Reliance Infocomm would take time.

Mr Anil Ambani's commitment of Rs 2,000 crore in the company is also seen as positive by most of the market players. "It shows how much committed he is to the company and its future growth," said a dealer with a domestic broking firm.

He added that the indication by Mr Anil Ambani that the company might be converted into a bank was also a positive for the stock.

"Several players are looking forward to valuation of Reliance Capital as a bank stock and not as a finance company."

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