Reliance scrips test negative as Sensex recovers

Though the Sensex was up in the morning trades, in a knee-jerk reaction, all Reliance group shares fell after 2.29 pm, when REL announced the resignation its directors. REL shares fell 5.83 per cent to Rs 549.10, Reliance Industries (RIL) lost 2.2 per cent to Rs 503.55, Reliance Capital fell 2.68 per cent to Rs 136.25. Reliance Industrial Infrastructure slipped 4.32 per cent to Rs 73.15 and Indian Petrochemical Corporation Ltd (IPCL) was down 3.67 per cent to Rs 175.35.

FIIs, despite being the major sellers, were not aggressive. Says Sanjiv Prakash of HSBC Mutual Fund: ‘‘The Reliance stocks have gone down almost 10 per cent in the last 10 days. They have factored in all news coming in the last few days.’’

He has asked small investors to be cautious. ‘‘Whatever news comes in, take it with a pinch of salt.’’

However, Thursday saw the fall in Reliance group stocks pushing down the overall market. The benchmark 30-share BSE Sensex ended 0.92 points lower to settle the day at 6,035.03.

The Sensex slipped from a high of 6,081.74 in the afternoon trades just after the news of the resignation came into the market. RIL has a weightage of about 11.07 per cent and REL has a weightage of about 1.46 per cent in the Sensex.

Says S K Mitra, MD, of Birla Sunlife MF: ‘‘I do not know if they are selling or not, but the market had run up a bit and someone is profit booking at the moment.’’

Speculation over a rift in the family controlling the Reliance group has dogged group companies since Friday (November 19, 2004). In the last five trading sessions since November 18, 2004 all the five Reliance group stocks have lost in the range of 2 per cent to 13 per cent.

REL was the biggest loser, with a decline of 12.63 per cent from Rs 628.45. RIL lost 7.70 per cent from Rs 545.55, IPCL fell 7.07 per cent from Rs 188.7, Reliance Industrial Infrastructure lost 3.94 per cent from Rs 76.15 and Reliance Capital dropped 1.91 per cent from Rs 138.90.