Reliance Industries’ decision to stop showing its refining margins in its quarterly numbers pulled down the stock on Monday, while TCS pipped the company to the top spot in market capitalisation.
Shares of Reliance Industries (RIL) on Monday lost almost Rs 70,000 crore of its market value. A section of analysts questioned the structure of the oil-to-chemical segment even as other key metrics such as debt reduction and operating profit disappointed in the third quarter.
The sell-off cost RIL the market crown as Tata Consultancy Services (TCS) once again became the most valuable firm in terms of market capitalisation.
The Reliance scrip ended sharply lower by 5.36 per cent, or Rs 109.95, to close at Rs 1,939.70 on the BSE.
During intra-day trades, the share hit a low of Rs 1,932.20 — a fall of 5.73 per cent over its last close. Reliance closed the day with a market cap of Rs 12.29 lakh crore.
This also had a bearing on the 30-share Sensex which extended its losses to the third straight trading session. The index dived 530.95 points to close at 48347.50.
The TCS counter closed with a market cap of Rs 12.34 lakh crore after it ended lower by 0.40 per cent.
Last Friday, post market hours, RIL had announced a 12.55 per cent rise in net profits at Rs 13,101 crore compared with Rs 11,640 crore in the year-ago period on good performance from its digital services business.
The company approved the formal reorganisation of its refining & petrochemical business segments into Oil-to-Chemicals (O2C) business.
RIL added that it will henceforth disclose O2C as a separate business segment. The conglomerate did not disclose how its refining division performed (done till the second quarter), leaving some analysts disappointed.
Revenues from the O2C segment had fallen to Rs 83,838 crore from Rs 119,121 crore in the year-ago period.
Analysts at Edelweiss said in a note that the profit numbers from RIL were entirely driven by investment income and a near-zero tax liability.
“O2C and retail missed expectations, but Reliance Jio (RJio) beat forecasts. While recovery is underway, it is mixed. But, transparency levels are falling across businesses. RIL has stopped reporting a key matrix—gross refining margins (GRM) altogether,” they said.
