RIL share price dropped 3.24% to hit an intraday low of ₹2,535 on the BSE

RIL shares dive 3% ahead of Q1 results; here’s why

Snapping four sessions losing streak, shares of Reliance Industries (RIL) tumbled over 3% in intraday trade on Friday as investors resorted to profit booking ahead of first quarter earnings report slated to be released post market-hours today. On Thursday, Reliance shares ended 1.6% higher at ₹2,620 on NSE after the new share price of RIL ex-JFSL was fixed at ₹2,580 in the special pre-opening session. However, as compared to Wednesday's closing price of ₹2,841.85, the country’s most valued stock settled 7.8% lower.

Early today, RIL shares opened marginally lower at ₹2,609 against the previous closing price of ₹2,619.85 on the NSE. On the BSE, the index heavyweight opened a tad lower at ₹2,603 compared to previous closing price of ₹2,619.80. The share price of the oil-to-telecom conglomerate declined as much as 3.24% to hit an intraday low of ₹2,535, while the market capitalisation (m-cap) dropped to ₹17.14 lakh crore.

Earlier this week, the RIL share price touched a fresh all-time high of ₹2,635.17 on July 19 and its m-cap crossed ₹19 lakh crore, driven by the demerger of its financial services arm, Jio Financial Services (JFSL). The stock hit its 52-week low of ₹2,012.14 on March 20, 2023. At the current price level, the stock trades 26% higher than its 52-week low and 4% lower than its record high level.

Also Read: Explainer: What does RIL-JFSL demerger mean for shareholders?

RIL shares were hammered today as investors turned jittery ahead of June quarter earnings, which will come a day after the split-off of JFSL as a separate entity. Billionaire Mukesh Ambani-led conglomerate is expected to report muted earnings in the first quarter of FY24 due to decline in its oil-to-chemical (O2C) business, as per analysts.

Foreign brokerage Morgan Stanley expects RIL’s EBITDA and net profit to fall by 0.5% and 19% QoQ, respectively. Oil to Chemicals EBITDA is expecetd to drop by 4% QoQ, despite the sharp correction in refining margins. The telecom arm, Jio is projected to report flattish EBITDA margins and average revenue per user (ARPU) QoQ at ₹180, with net addition of 8 million subscribers. 

Reliance’s consolidated net sales are likely to be at ₹2.14 lakh crore and net profit is estimated at ₹16,995.50 crore, according to Bloomberg survey of brokerages.

Also Read: Jio Financial share price fixed at ₹261.85 after demerger; RIL up 1.5%

On Thursday, the demerger of Jio Financial Services from RIL took place and JFSL shares were temporarily listed on the bourses at a discovery price of ₹261.85 per share after the special pre-opening session on the NSE. The discovery price of JFSL was much higher than analysts’ estimate of ₹160-190 per share. Axis Securities has pegged JFSL price at ₹160 apiece, while Motilal Oswal at ₹190 per share. Nuvama Institutional Equities has estimated the listing at ₹168, while Jefferies and JPMorgan at ₹179 and ₹189, respectively.  

JFSL has been temporarily added to all the NSE and BSE Indices at a constant price till the listing date is announced. It has been added as a 51st constituent in Nifty50 and 31st constituent in Sensex. The stock will be considered in weight calculations of indices on a daily basis. It will be removed from all the indices three days after JFSL listing on the stock exchanges. 

DISCLAIMER: The views and opinions expressed by investment experts on fortuneindia.com are either their own or of their organisations, but not necessarily that of fortuneindia.com and its editorial team. Readers are advised to consult certified experts before taking investment decisions.

Also Read: RIL share hits fresh 52-week high ahead of Jio Financial demerger; m-cap crosses ₹19 lakh cr

Follow us on Facebook, X, YouTube, Instagram and WhatsApp to never miss an update from Fortune India. To buy a copy, visit Amazon.

More from Investing

Most Read