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RBI signals quick withdrawal of liberal measures to stem economic slowdown

Mumbai: The Reserve Bank of India has red flagged the disconnect between the real economy and the exuberance in stock markets in Covid times, and has signalled a quick withdrawal of the liberal measures to counter the slowdown as soon as the economy returns to normalcy.

There is “a growing disconnect between the movements in certain segments of financial markets and real sector activity,” RBI Governor Shaktikanta Das wrote in the latest Financial Stability Report. “Once we enter the post-pandemic phase, the focus would be on calibrated unwinding of regulatory and other dispensations.’’

RBI Governor’s warning comes amid a strong rally in equities when the lockdown has led to shuttering of businesses for months and loss of income. Economists are forecasting the gross domestic product to shrink more than 5 percent and a surge in defaults. But the benchmark Sensex has climbed more than 45 percent since its March lows. The central bank has declared moratorium on payments for six months till August end.

While the RBI’s Financial Stability Report does not provide an assessment of what could be impact of the moratorium on banks, it has warned that banks could see a spike in defaults. It said in the first few weeks of moratorium nearly half the borrowers across the spectrum availed the benefit. Bank have since said that these have been falling as cash flows improve.

“The regulatory dispensations that the pandemic has necessitated in terms of the moratorium on loan instalments and deferment of interest payments may have implications for the financial health of SCBs,’’ it said.

The bad loans situation that has been easing for the past few quarters could climb again.

“The stress tests indicate that the GNPA (gross non performing asset) ratio of all banks may increase from 8.5 per cent in March 2020 to 12.5 per cent by March 2021 under the baseline scenario,’’ it said. “If the macroeconomic environment worsens further, the ratio may escalate to 14.7 per cent under the very severely stressed scenario.’’

The central bank since March has come up many measures including interest rate cuts and flooded the market with liquidity. But still government finances could get out of shape, it said.

“Central Government finances are likely to suffer some deterioration in 2020-21, with fiscal revenues badly hit by COVID-19 related disruptions even as expenditures come under strain on account of the fiscal stimulus,’’ the FSR said.

Yet another disturbing trend in the financial markets is the slowing of deleveraging by corporates and unproductive use of borrowed funds.

“Deleveraging by the private corporate sector over the recent years stalled during the second half of 2019-20 as leverage ratios (measured by the debt to asset ratio) increased due to higher borrowings,’’’ it said. “Incremental borrowings were used towards creating financial assets (loans and advances to subsidiary/ other companies and financial investments) and not for capex formation, as demand conditions remained muted.

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Stock Market

Client-aligned models for AMCs are the need of the hour : Nikhil Kamath

By Tamanna Inamdar


A lot of numbers from June when the mutual fund inflows have gone down, show many short term discrepancies at play. This trend will reverse in the future and mutual fund inflows will start again and direct investment into equity will continue to grow as well, says the Co-Founder & CIO, Zerodha.

Are you seeing any change in perception taking place and is it advantage investors who want to now come in directly and cut out the middlemen?
As long as the investors are coming into the market — be it from the mutual fund or direct equity investment — for a country with a population like ours, the equity markets are under penetrated. It is good if they come in through mutual funda and it is also good if they come in directly. I do not think one industry necessarily competes with the other. The goal is to grow the pie together and have increased participation amongst the retail investors of India.

Agreed that is fantastic message as long as the money is coming into equity markets, but we are talking about investors who are wondering whether it makes sense to remain in mutual funds or come in directly. Most investors are not thinking whether they are contributing to the equity markets and deepening them one way or the other. They are focussed on returns. Do you think retail investors are getting cheesed off with mutual funds?
Over the last decade or two, for the asset management industry as a whole — not just in India, but across the world — the models have changed. You have statutory fees that you pay immaterial of how well or how badly your fund manager does. We have too many distributors and too many middlemen selling products. A lot has to change to make this industry more efficient. The incumbent fund houses in India have been a little averse to starting great ETF products because it takes away the earnings and revenues from existing products which might offer a bigger margin for a distributor.

So a lot has to change in asset management. I would say client aligned models are the need of the hour, wherein a fund manager or a fund house benefits depending on how well they perform and they do not have a common fee which they charge on years when they do well and when they do not do well as well. So a lot has to change.

I do not think that in terms of the money being allocated to equity market, the route a retail investor might take has changed structurally. A lot of numbers from June when the mutual fund inflows have gone down, show many short term discrepancies at play. This trend will reverse in the future and mutual fund inflows will start again and direct investment into equity will continue to grow as well. But the onus is on the asset management industry in India to make a product which is more efficient and more suitable today than the incumbent products and fund managers we have in the industry.

Which is safer? There is no way to know the exact figures though a lot of people possibly have now decided that let us make a go at it ourselves. Mutual funds were always supposed to be the vehicle for those who did not have the knowhow or the time to track the markets very closely. Now a lot of people are doing it themselves. Is it a DIY phase? Is that a little dangerous where investors can get burnt? There may be a greater upside but then a bigger downside as well?
There are two ways to look at this. If you go back in time and look at the history of investment, there is a case to be made that passive investing has done better than active investing or a fund manager managing your money. There is a case for the other side as well. In terms of retail investors coming into the market directly, the ones who are doing it by virtue of investing in largecap blue chip companies, are kind of okay and at some level.

The regulator or Sebi seems to be one step ahead throughout the pandemic and they saw that a lot of retail investors were coming in and using leverage as a product to enter. Two days ago they came out with the new circular which kind of rationalises the amount of leverage available for a retail investor to trade and transact in securities. I think this will make the market a bit more stable. It will happen in a phased manner, starting in a couple of months. But it will go a long way in making the markets more stable and robust in the long term.

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Stock Market

Twitter: Twitter shares rise on record yearly growth in daily users

SAN FRANCISCO: Twitter Inc on Thursday reported its highest-ever yearly growth of daily users who can view ads, beating analysts’ estimates on usage and sending its shares up 4%.

Twitter’s average monetizable daily active users (mDAU) increased 34% year over year to 186 million, above analysts’ estimate of 176 million, in a rise it said was primarily driven by external factors such as shelter-in-place requirements and increased conversation around the COVID-19 pandemic.

But the company missed Wall Street’s lowered expectations for quarterly revenue, as the coronavirus-spurred economic slowdown battered the company’s largely events-oriented digital ads business.

Ad sales, which make up 82% of Twitter’s revenue, sank 23% to $562 million, a drop the company attributed to brand spending pauses tied to the pandemic and US civil unrest. Analysts had expected $585 million, according to IBES data from Refinitiv.

Chief Executive Jack Dorsey opened a conference call with analysts by apologizing for the hack that compromised the accounts of high-profile users last week, saying “we feel terrible.” In a statement, Dorsey said Twitter had taken steps to improve its security and “resiliency against targeted social engineering attempts.”

Total revenue came in at $683 million, down 19% year-over-year, helped by steadier sales growth from the licensing of users’ posts to researchers and marketers.

Twitter has struggled to build out its ad offerings, leaving it reliant on a suite of promotional tools geared toward advertising around big events and product launches, which have all but vanished during the pandemic.

The company said it finished rebuilding its ad management technology in the second quarter, which would support faster development of new formats going forward, and was rolling out measurement tools for “direct response” ads used by app developers.

On the conference call, Chief Financial Officer Ned Segal declined to give details about the impact of a July social media advertising boycott that was intially focused on Facebook but spread to other platforms. Dorsey said Twitter’s actions to protect conversations on the platform were being noted by advertisers.

Twitter also said it was exploring “subscriptions and other approaches to complement our advertising business,” such as commerce, though it was not expecting any revenue to result this year Dorsey said on the call that the company would have a “really high bar for when we would ask consumers to pay for aspects of Twitter.”

The company reported a second-quarter loss of $1.2 billion, largely driven by the reversal of a tax benefit established last year, when the company transferred intellectual property to Ireland. Because of the second quarter’s steep coronavirus-related losses, Twitter did not make enough money to take advantage of the tax benefit.

Adjusted to exclude the tax considerations, the company incurred a loss of $127 million, or 16 cents per share, roughly in line with analyst expectations of a $125 million loss. It had an adjusted profit last year of $37 million.

Echoing earlier guidance, Twitter said it expects data licensing revenue to “moderate” for the rest of the year.

Costs and expenses grew 5% to $807 million, below the increase in the low teens that Twitter had forecast. The company said it anticipated expense growth of 10% or more in the third quarter.

Social media rival Snap Inc missed user growth estimates earlier this week, as its usage bump from coronavirus lockdowns petered out sooner than expected, but it beat targets for revenue gains.

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Stock Market

Bajaj Auto Ltd.: Bajaj Auto focuses on exports as India battles pandemic

NEW DELHI: Bajaj Auto is betting that an early recovery from the ravages of COVID-19 in motorcycle sales in its export markets will help it offset pandemic-related disruption at home, its chief financial officer said.

The Indian company, which also sells rickshaws and small commercial vehicles, is already the largest exporter of motorcycles from its domestic market, where sales have been slow to pick up due to local lockdowns.

“All our export markets were also affected but recovery has been better (there) than in India,” Soumen Ray told Reuters in an interview late on Wednesday. “We will continue to remain aggressive on exports.”

Bajaj plans to open an assembly plant in Brazil within 18 months, as well as a design office in Thailand to handle sales for the ASEAN region, and another design office in Europe, Ray said.

Exports make up 40%-45% of group motorcycle sales, Ray said.

This year, however, they have predominated. Between January and June, it exported 664,000 motorcycles while selling 589,000 in India, company data showed.

Ray declined to comment on the company’s sales targets.

Bajaj, which currently sells to countries in Africa, Asia and Latin America, is facing supply chain issues at its plants in India due to lockdowns imposed by local governments.

Its workforce is also 10%-15% short as many staff are either worried about coming to work or have returned to their villages, Ray said.

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Stock Market

sensex rally today: Firm cues, strong Q1 numbers push Sensex 269 pts higher; RIL hits record high

MUMBAI: Benchmark equity indices resumed their uptrend on Thursday after a one-day pause as investors focussed on firm cues from global markets and better-than-expected June quarter earnings, shrugging off concerns over renewed US-China tensions.

Reliance Industries (RIL) and financials spearheaded the rally and drove Sensex 269 points higher to 38,140. Its peer Nifty climbed 83 points to settle at 11,215.

“Global markets set aside the rising US-China tensions and focused on potential vaccine developments and better than expected earnings numbers. Domestically, except for IT, most major indices logged gains. Liquidity seems to be driving the markets,” said Vinod Nair, head of research at Geojit Financial Services.

“Any dip looks like it will be bought into and is likely to be short-lived, especially in the current mood of the markets when the negatives are being overlooked,” he added.

Another record surge in new coronavirus infections was also overlooked. The total Covid-19 cases in the country have breached the 12-lakh mark.

In the 30-pack Sensex, as many as 22 stocks settled in the green.

BSE snip 23xxAgencies

Sensex heatmap (Source: BSE)

Oil-to-telecom behemoth RIL contributed the most to the benchmark’s gains. The stock in intraday trade hit a new high of Rs 2,078.90 after ET Now reported Amazon is looking to pick a 9.9 per cent stake in Reliance Retail. It pared some gains and shut shop 2.82 per cent higher at Rs 2,060.65 with market cap soaring past Rs 13 lakh crore.

Private lender ICICI Bank rose 2.94 per cent while smaller rival Kotak Mahindra Bank climbed 2.14 per cent.

Cigarettes-to-hotels business ITC and paints maker Asian Paints rose 2.09 per cent and 1.94 per cent, respectively ahead of their June quarter earnings on Friday.

Engineering and construction major Larsen & Toubro shed 0.50 per cent as sharp decline in orders dented its Q1 net profit.

Market breadth tilted in favour of the gainers with advance-decline ratio at 1.2:1 on the BSE.

The broader market was upbeat as well, with BSE Midcap and Smallcap indices rising 0.98 per cent and 0.61 per cent, respectively.

BSE Energy was the biggest sectoral gainer as it rose 2.36 per cent. It was followed by BSE Healthcare that advanced 1.65 per cent. BSE IT shed the most, down 0.61 per cent.

Rossari Biotech’s stellar debut stole the show as the specialty chemical maker’s shares rallied nearly 75 per cent over their issue price on listing day.

Private lender YES Bank nosedived 19.2 per cent, taking its losing streak to the fourth straight session. The stock has been on a falling spree ever since the bank concluded its Rs 15,000 crore follow-on public offer (FPO), even as Moody’s feel the capital raising by the bank is credit positive.

Glenmark Pharmaceuticals rose 1.87 per cent as the drug maker on Wednesday said Phase 3 clinical trial of antiviral drug Favipiravir in mild to moderate Covid-19 patients demonstrated significant faster time to clinical improvement.

ICICI Securities rose 2.37 per cent after it reported a 70 per cent jump in profit after tax (PAT) to Rs 193 crore in the April-June quarter on robust growth in revenues and improvement in margins.

Trident jumped 10 per cent after promoter Trident Group bought 4,80,00,000 shares in the company on Wednesday.

Foreign institutional investors (FIIs) have flip-flopped between being net buyers and net sellers of Indian shares in July. They are net buyers to the tune of $61.81 million or Rs 425.47 crore so far this month. Domestic institutional investors (DIIs) on the other hand, have sold a net of Rs 5,627.58 crore of the asset class this month.

Markets at a glance:

  • Sensex up 0.71% or 269 points to close at 38,140
  • Nifty climbs 0.74% or 83 points to close at 11,215
  • 22 of 30 Sensex stocks close higher
  • RIL records new high; m-cap rises past Rs 13 lakh crore
  • Top Sensex gainers: SBI up 3.28 %, ICICI 2.94%, RIL 2.82%
  • Top Sensex losers: Axis down 3.80%, HUL 1.57%, Infy 1.15%
  • Market breadth positive; advance-decline ratio 1.2:1
  • Broader markets rise; BSE Midcap up 0.98%, Smallcap 0.61%
  • BSE Energy top gainer, up 2.36%; Hindustan Oil up 4.97%, GMDC 3.74%
  • BSE Healthcare up 1.65%; Sequent up 9.50%, Medicamen 8.68%
  • BSE IT top loser, sheds 0.61%; Newgen down 5.68%, 3i Infotech 4.96%
  • ITC, Asian Paints up ahead of Q1 earnings Friday
  • L&T drops 0.50% as decline in orders hurts Q1 net
  • Glenmark up 1.85% on optimistic Favipiravir trial results
  • ICICI Sec up 2.37% on robust Q1 net
  • Trident up 10% as promoter ups stake

Who moved my market

European stocks rose on Thursday as better-than-expected corporate earnings offset worries about rising cases of COVID-19 and a sharp escalation in tensions between the United States and China, Reuters reported. The pan-region Euro Stoxx 50 climbed 0.42 per cent while the German DAX gained 0.43 per cent and the FTSE 100 by a similar margin. S&P mini-futures added 0.29 per cent, pointing to a stronger open on Wall Street. The MSCI world equity index, which tracks shares in 49 countries, rose 0.2 per cent, close to Tuesday’s level, which was its highest since late February.
Better-than-earnings from India Inc boosted the sentiment on Dalal Street. Market participants were keenly eyeing the June quarter numbers and management commentary as the companies faced the brunt of nationwide lockdown the most during this period. “Markets are currently riding high on better than expected earnings and upbeat global markets. Considering the momentum, the Nifty index might test 11,350 soon. Traders should align their trades accordingly but we suggest preferring hedged trades instead of outrights,” said Ajit Mishra, VP – Research, Religare Broking.

  • Coronavirus cases rise above 12-lakh mark

New coronavirus cases in India rose be a record 45,720 on Thursday, pushing the total Covid-19 tally in India over 12 lakh mark , while the total number of recoveries crossed 7.82 lakh, according to the Union Health Ministry data. The death toll due to the disease rose to 29,861 with 1,129 fatalities reported in one day.

What to watch out for

  • The coronavirus cases in India are yet to peak and are witnessing a record rise each day and are a major cause of worry.
  • The direction of global markets will be closely watched as the domestic market tends to follow the cues.
  • Progress on domestic as well as overseas vaccine for Covid-19 treatment will be closely watched.
  • The ongoing June quarter corporate earnings season is providing a better picture of the damage caused by the pandemic-induced lockdown. More than the numbers for the quarter, the commentary and the outlook are the key moniterables.

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Stock Market

Yes Bank Share Price: YES Bank plunges 20%, takes losing streak to 4th day

NEW DELHI: YES Bank stock nosedived 20 per cent in Thursday’s trade, taking its losing streak to the fourth straight session. The scrip had huge sell orders in the Rs 14.60-14.80 range on BSE, but no buyers.

The stock has been on a falling spree ever since the bank concluded its Rs 15,000 crore follow-on public offer (FPO), even as Moody’s feel the capital raising by the bank is credit positive.

Moody’s said the fund raising would strengthen the core capital and loss-absorbing buffers, besides reducing default risks for creditors.

The stock fell 20 per cent to hit a low of Rs 14.60 on BSE. With Thursday’s losses, the scrip has fallen 26 per cent in the four sessions.

YES Bank was near bankrupt in March and was rescued by a Reserve Bank-led bailout plan under which SBI picked up 49 per cent equity in the once-storied private sector lender.

“Successful equity raising reflects YES Bank’s regained access to external market funds, which in turn shows its improving financial strength and will help support depositor confidence,” Moody’s said on Tuesday.

The FPO had attracted bids for 8,47,12,49,000, which was 93 per cent of the issue size of 9,09,97,66,899 shares, data compiled from NSE suggests. For an FPO to sail through, a minimum of 90 per cent of the issue needed to be subscribed.

The bank had earlier entered into an underwriting agreement with SBICap, wherein the latter agreed to underwrite Rs 3,000 crore at a price equal to or the lowest end of the price band.

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Stock Market

RBL to lead small banks’ capital charge with Rs 1k cr

The revival in investor sentiment towards banks after a brutal sell off in the first quarter due to concerns on deposit outlfows and uncertainties related to Covid-19 has caused smaller banks to consider a share sale to bullet proof their balance sheets.

Banks like RBL Bank, Federal Bank and DCB Bank are now likely to join the their bigger peers such as ICICI Bank and Axis Bank in planning a share sale some time this year.

RBL Bank, which raised Rs 2025 crore through a qualified institutional placement (QIP) as recently as December is likely to be first off the block seeking to raise another Rs 1000 crore through a preferential allotment as it seeks to insulate itself from any shocks in the future due to the Covid 19 pandemic.

“A preferrential issue is on the table because it can be done quickly and needs fewer investors. Not all existing investors may be ready to put money today hence a preference issue is under serious consideration of the bank and could be completed in the next couple of months. The idea is to take capital when it is available as many large lenders are shoring up their base and global liquidity is also benign,” said a person aware of the bank’s thinking.

RBL’s capital adequacy at 16.45% is almost double the 9% required. However, the bank wants to ensure that it has enough capital to meet any eventuality later in the year.

RBL did not reply to an email seeking comment.

Other smaller lenders have already taken shareholder approvals so that they can hit the market in quick time when necessary. Federal Bank has shareholder approval to raise up to Rs 12,000 crore through a mix of debt and equity. Executive director Ashutosh Khajuria said the bank wants to be prepared for any eventuality.

“The outcome of Covid 19 is still uncertain. People are talking about one time restructuring and extension of moratorium but there is no clarity on how things will pan out. With a capital adequacy of 14% we have no immediate need to raise funds but in case stress increases we may want to use the options,” Khajuria said.

The fact that the bank stock price has recovered off record lows seen in March has also given confidence to bank management to explore a fund raising plan without diluting too much equity. Federal Bank shares for example have bounced back 59% from their low of Rs 36 per share in March to end at Rs 57 per share on Wednesday. Similarly, RBL bank has gained 35% while DCB Bank is up 11% from their March lows.

“Raising capital is call of both keeping enough for stressed times as well as for future growth. We have a enabling resolution from shareholders to raise Rs 500 crore of equity but with a capital adequacy of 17.75% are not in any hurry to do it,” said Murali Natrajan, CEO at DCB Bank.

Analysts said Indian banks are better prepared this time learning from the experience of their western counterparts during the global financial crisis.

“One of the key lessons learned from the GFC was that banks in the US and Europe which delayed raising capital faced a tougher time as the economic shock lasted much longer,” said Abhinav Bharti, head of India ECM, J.P. Morgan.

“The true impact of COVID and moratoriums will only be known by third quarter FY21 and therefore important that banks create sufficient capital reserves for any stress scenario,” he said.

Investor appetite is still strong for a piece of the Indian financial sector and small and mid size banks may want to tap it sooner rather than later said Taranjit Jaswal, head of corporate banking, Barclays India.

“With equity raise, banks are also preparing a war-chest, to take care of slippages, once the loan moratorium period is lifted,” Jaswal said.

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Stock Market

Balaji telefilms Ltd.: Balaji Telefilms Q4 results: Net loss narrows down to Rs 20 cr

NEW DELHI: Production house Balaji Telefilms Ltd on Wednesday reported narrowing of consolidated loss to Rs 19.84 crore in the fourth quarter ended on March 31, 2020.

The company had posted consolidated loss of Rs 27.97 crore in the same quarter of the preceding fiscal, Balaji Telefilms said in a regulatory filing.

Revenue from operations during the quarter under review stood at Rs 107.68 crore as compared to Rs 88.86 crore in the year-ago period, it added.

For the fiscal ended on March 31, the company said its consolidated loss was at Rs 58.96 crore. The same was at Rs 97.75 crore in the previous year, Balaji Telefilms said.

Revenue from operations in 2019-20 was Rs 573.55 crore as compared to Rs 427.7 crore in 2018-19, it added.

The Covid-19 pandemic and the resultant lockdown declared by the government in March 2020 has adversely impacted the entire media and entertainment industry and consequently the business activities of the group are also affected, Balaji Telefilm said.

It, however, said operations for TV business have resumed as per guidelines of the government and local authorities from June 26.

Although the group’s digital business continued to operate throughout the lockdown period, launch of new shows is affected due to shutdown in production activities during the lockdown phase, it said.

Production of digital content and films is expected to be resumed in due course, it added.

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Stock Market

Banks playing dampener in India’s growth story, says CEA Subramanian

NEW DELHI: Krishnamurthy Subramanian, the chief economic advisor (CEA) to the Government of India, blamed banks and problems associated with them for the current economic slowdown.

Speaking at a Ficci event on Wednesday, Subramanian said the Indian economy has been caught in a
chakravyuh due to bad decisions made by banking executives in the last few years.

“Large parts of the current slowdown is because of problems in the banking sector. NPAs, risk aversions and decline in corporate lending had an impact on investment which led to slowing of growth which in turn led to drop in consumption. This again led to lower investment,” he said.

The veteran economist said we need to focus on making Indian banks on the scale of any global economy. He highlighted that today just one Indian bank is in the top 100 bank list, against 18 for China and 12 for the US. Countries such as Switzerland, Sweden, Singapore, etc, that are a fraction of India’s size are all better positioned.

“Any economy that is sizable enough has been built only when the banking sector had large banks. This is one area in which India lags behind spectacularly and a lot of work is required,” said Subramanian.

So what exactly is hindering Indian banks to become one of the biggest in the world? “Banking sector is marred with both scale and quality problems. When we try to achieve scale, we do not end up lending the right way because the banking sector also has a problem allocating capital to good quality projects. Both of these are equally important,” he said.

Subramanian also suggested a way to solve the above problem — adopt technology and use big data to screen sketchy borrowers. “We are using data and analytics for retail lending, but use of the same for corporate lending is not adequate,” he said.

Competition key to success

Outlining the free market theory, Subramanian said Indian firms will have to compete against the best to build capabilities. And utilising India’s large market as a comparative advantage could help them in the process.

He gave examples of FMCG firms who pack their products in small sachets to serve low-income customers, hence not sticking to just a select number of customers.

“The lesson that people can take away from shampoo sachets is that the bottom of the pyramid also wants to avail products and services that are similar to those available to the richest 25 per cent. But the price point needs to be better because of the nature of the cash flow at the bottom of the pyramid,” said Subramanian.

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Stock Market

RIL share price: Trending stocks: Reliance Industries shares rise over 1%

NEW DELHI: Shares of Reliance Industries Ltd. traded 1.09 per cent up in Wednesday’s trade at 10:05AM (IST). Around 379,369 shares changed hands on the counter.

The counter opened at Rs 1980.05 and touched an intraday high and low of Rs 2000.0 and Rs 1960.0, respectively, in the session so far. Shares of the company of Reliance Industries Ltd. quoted a 52-week high of Rs 2000.0 and a 52-week low of Rs 867.11.

Total market cap of the Reliance Industries Ltd. stood at Rs 1350745.89 crore at the time of writing this report.

Key Financials

The company reported consolidated sales of Rs 136240.0 crore for the quarter ended 31-Mar-2020, down 11.06 per cent from previous quarter’s Rs 153179.0 crore and down 2.4 per cent from the year-ago quarter’s Rs 139590.0 crore.

The net profit for latest quarter stood at Rs 6348.0 crore, down 38.74 per cent from the corresponding quarter last year.

Shareholding pattern

As of 11-Jun-2020, DIIs held 5.25 per cent stake in the firm, while foreign institutional investors held 24.14 per cent and the promoters 49.15 per cent.

Valuation ratio

According to BSE data, the stock traded at a P/E multiple of 34.32 and a price-to-book ratio of 2.74. A higher P/E ratio shows investors are willing to pay a higher price because of better future growth expectations. Price-to-book value indicates the inherent value of a company and is the measure of the price that investors are ready to pay even for no growth in the business.

Reliance Industries Ltd. belongs to the Diversified industry.

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