Shares of India’s most valuable company Reliance Industries Limited (RIL) fell over 2 per cent on the stock market on Monday. At 1:00 pm, shares of RIL were trading lower by 2.10 per cent after falling over 2.5 per cent in early trade.
The 2 per cent dip in RIL shares came after the company reported its March quarter results. Though the Mukesh Ambani-led company doubled its quarterly profit on a year-on-year basis, it failed to meet the expectations of analysts. This is likely to be one reason behind today’s fall.
While RIL shares continue to trade higher than the 20-day moving average, it is lower than the 5-day, 50-day, 100-day and 200-day moving averages, reported Business Today. According to the report, RIL’s shares have declined 1.48 per cent since the beginning of this year.
WHY RIL SHARES SLIPPED?
The shares of RIL slipped on the stock market today after the company declared its Q4FY21 results on Friday.
While RIL’s net profit doubled on an on-year basis, the sequential improvement was marginal at just one per cent. The same can be said for the conglomerate’s other businesses that saw a marginal recovery on a sequential (Q-o-Q) basis.
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As a result of Monday’s slip on the stock market, the market capitalisation of the company fell to 12.87 lakh crore on the Bombay Stock Exchange.
Commenting on the RIL Q4 results, ICICI Securities said, “”Petrochemicals and retail were the bright spots in Q4. Retail may lose momentum due to covid second wave while petrochemicals may be hit by large capacity additions in H2/Q4FY22E.”
“Regaining momentum in subs addition, tariff hikes, retail growth back to pre-covid levels, GRM recovery and stake sale in O2C are key to stock performance improving (underperformed since Sep’20). Retain HOLD with a target price of Rs 2,033 (2% upside),” it added.
Many experts explained that RIL’s Q4FY21 results were good on an on-year basis, it failed to meet the expectations of analysts. Some analysts also said that the value of Reliance’s shares fell due to overall market weakness due to the worsening second Covid-19 wave in the country.