Reliance shares drop 3% as battery unit faces fines for missed deadline
Reliance Industries’ shares fell over 3% after its battery unit missed a key deadline, making it liable for fines. At 12 PM IST, the stock traded at ₹1,160.10, down 3.29% or ₹39.50, hitting an intraday low of ₹1,156.
Reliance New Energy Ltd, Rajesh Exports, and a unit of Ola Electric won the Production Linked Incentive (PLI) bid for battery cell manufacturing in 2022. However, Reliance New Energy failed to meet the deadline to open its plant. According to Bloomberg, the company could face fines of up to ₹125 crore. Rajesh Exports may also face similar penalties.
Unlike Reliance, Ola Electric started trial production in March 2023 and plans to begin commercial production of lithium-ion cells between April and June this year. The PLI scheme required companies to achieve a committed capacity with 25% local value addition within two years and 50% within five years.
Reliance shifted focus to green hydrogen, a carbon-free fuel for the future. The PLI scheme, part of India’s ‘Make in India’ push, aimed to reduce reliance on China by offering ₹18,100 crore in subsidies. It sought to create 30 GWh of advanced battery storage capacity.
Despite Prime Minister Narendra Modi’s goal to raise manufacturing to 25% of India’s GDP, its share fell to 13% in 2023 from 15% in 2014.
