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Our Bureau

Mumbai, Oct. 16 Reliance Industries touched a new 52 week low on Thursday as the stock dipped 12.65 per cent during intra-day trade. The stock plunged to a low of Rs 1,327 and closed at Rs 1,397.25, 8 per cent below the previous day’s close.

The stock accounted for most part of the 2.11 per cent dip in the Sensex on account of its weightage, which is the highest in the index.

Reliance Industries is heavily invested in by both foreign institutional investors (FIIs) and domestic mutual funds. “As FIIs are taking money out of our markets to repay their obligations back home, and the mutual funds facing redemption pressure, it comes as no surprise that the stock has been heavily sold,” said Mr P.K. Agarwal, President, Bonanza Portfolio. “The FIIs and mutual funds are looking at every opportunity to encash their shares and repay their obligations.”

In the last two trading sessions, the stock has fallen close to 14 per cent and, in the past one month, dipped 28 per cent.

A total of 1.32 crore RIL shares were traded on BSE and NSE on Thursday.

Mr Alex Mathew, Head of Research, Geojit Financial Services, said that the stock has also become technically weak as it has fallen below its previous low of Rs 1,477. “Unless the heavyweight stock Reliance gets consolidated, we can’t see a firm market.”

The effect on the company’s financial performance of the drop in refining margins industry-wide is worrying investors, said analysts. “The new refinery and petrochemical businesses will be negatively affected by falling refining margins. What with current slowdown and tight liquidity conditions it is definitely not a good time for Reliance Industries,” said an analyst with a stock broking firm.

The price of crude has dipped close to 50 per cent from its peak of $147 touched in July this year.

More Stories on : Stocks | Reliance Industries Ltd

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