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Investors show confidence in Reliance Industries

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Co’s stock has been under pressure in recent times

Despite Reliance Industries facing one of the turbulent periods in its history, it seems investors are reposing faith in the Mukesh Ambani-controlled company. There was no major change in RIL’s shareholding pattern, according to the latest information available with the exchanges,

Promoters have increased their stake only marginally even after the company came up with a buy back plan at a maximum price of Rs 870. Their holding moved up to 45.15 at the end of June quarter from 44.75 per cent of March quarter.

The Rs 10.440-crore buyback window, which opened in February, will remain open till January 2013.

Number of retail investors has come down to 33.12 lakh from 33.50 lakh in March.

LIC, Singapore hike stake

On the other hand, insurance major LIC and Government of Singapore have hiked their stakes in the company. LIC’s holding increased from 7.09 per cent to 7.77 per cent during the quarter ended June 30. The Government of Singapore saw its holding increase marginally to 1.22 per cent (1.06 per cent).

It may be recalled that HDFC group become India's second biggest corporate house after Tatas in terms of private sector stock market valuation. Besides, the company also slipped to third position in terms of market capitalisation behind ONGC and TCS.

Reliance Industries also lost its most influential status to ITC in Sensex and the Nifty Index.

In recent times, RIL’s stock has been facing selling pressure due to fundamental concerns over refining margins and lower production, besides lingering uncertainties over production-sharing contracts.

For the third straight quarter, Reliance Industries posted a decline in its net profit. Its net profit stood at Rs 4,470 crore against Rs 5,661 crore it declared for the same period last year, a 21 per cent fall.

The stock hit a 52-week high of Rs 902 (November 4, 2011) and a low of Rs 671 (May 8). On Friday, the shares closed 0.70 per cent lower at Rs 722.65 on the BSE.

badri@thehindu.co.in

(This article was published on July 20, 2012)
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