Mukesh Ambani has experienced a significant financial setback recently, losing nearly Rs.1.32 lakh crores in just four days due to a sharp decline in the stock price of Reliance Industries Limited (RIL).
The Indian stock market is experiencing significant turmoil, with the Sensex plummeting over 1,750 points and the Nifty50 falling to 25,250. Heightened tensions in the Middle East, particularly Iran’s missile strike on Israel, along with rising oil prices, SEBI’s measures on F&O trading, and worries about a rebound in Chinese stocks have led to considerable fund outflows, adversely affecting market sentiment.
FII Sell-Off
The recent rally in Chinese stocks and new restrictions on derivatives trading have led foreign portfolio investors (FPIs) to reduce their exposure to the Indian market. Provisional data from stock exchanges indicate that FPIs sold $1.82 billion worth of shares on Thursday, marking their third consecutive session as net sellers.
Foreign Investors sold Rs.621.4 million worth of Indian shares on October 1, following Rs.767 million in sales on the last trading day of September. This continued sell-off has had a noticeable impact on India’s market flows, contributing to heightened volatility and downward pressure on equity prices. Additionally, in last 3 trading days foreign investors offloaded stake worth $3 Billion.
Impact on Reliance
Mukesh Ambani has faced a significant financial setback recently, with losses approaching Rs.1.32 lakh crores in just four trading sessions due to a sharp decline in the stock price of Reliance Industries Limited (RIL).
On October 1, RIL’s market capitalization fell by approximately Rs.21,000 crores, as its shares decreased by 2 percent. The downward trend continued on October 3, when the company’s shares dropped nearly 3 percent, leading to a further loss of around Rs.77,000 crores in a single day.
In today’s trading session, RIL’s shares fell an additional 1.5 percent, reducing the market cap by Rs.34,000 crores. This cumulative decline has resulted in a total loss of about Rs.1.32 lakh crores over the four days.
The decline in RIL’s stock is part of a broader downturn in the Indian stock market, driven by geopolitical tensions and fluctuations in crude oil prices due to the ongoing crisis in the Middle East. This situation has particularly impacted companies in the oil and gas sectors, which are central to Reliance’s business model.
Current Position
With a market capitalization of Rs.18,80,405 crore, the share price of RIL closed at Rs.2,773.00 per share on Friday, falling 1.42 percent from its previous close of Rs.2,813.95 per share.
In its latest financial update, the company reported net sales of Rs.2,31,784 crore for Q1 FY25, representing a 12 percent increase from Rs.2,07,559 crore in Q1 FY24. However, net profits of the company declined by 4.5 percent to Rs.17,445 crore in Q1 FY25, from Rs.18,258 crore in Q1 FY24.
Company Profile
Reliance Industries Limited is an Indian multinational conglomerate headquartered in Mumbai, operating across various sectors, including petrochemicals, refining, telecommunications, and retail. It has emerged as India’s largest private sector company and a prominent global player, recognized for its innovation and significant contributions to the economy.
Written by – Siddesh S Raskar
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