RIL Share Price Today: Reliance Industries Limited market capitalization tanks -Reasons and what shareholders should knowMarch 21,2023
Reliance Industries Limited (RIL) share has witnessed a significant decline over the past two weeks. since March 8, RIL stock has lost almost 10 per cent. On Monday, as the overall market underperformed amid ongoing saga over UBS-Credit Suisse acquisition, RIL shares were trading significantly lower at Rs 2193 apiece near the April 2020 lows.
Analysts believe that one of the reasons behind Reliance's underperformance could be the lack of clarity on the company's capex cycle. The investor community is ambiguous about the capital investments and the returns that could be expected from the company over the next few months.
Why is RIL underperforming? Soumeet Sarkar of ET NOW decodes
Even in past, during capex cycle, RIL share prices have been lagging. Due to this higher capex and acquisitions, RIL's debt has also increased sharply. From being a net debt free company, RIL's debt has reached close to Rs 1.1 lakh crore. High debt, coupled with a rising interest rate cycle will lead to higher interest outgo, analysts believe. Also in the O2C segment, margins are yet to revive.
On April 29 last year, RIL shares touched an all time high of Rs 2856 apiece. "Reliance has been in the 2200-2700 band for a long time. Now it is at the lower end of the band. There have been positive triggers which will come later, may be the listing of Jio, or can be the retail arm de-merged a separate company. It is because of the way market has been behaving that a lot of people have been waiting for triggers. In a longer of term, these are opportunities for a long term investor," says Neeraj Deewan of Quantum Securities.