Reliance shares drop over 4%, YTD returns turn negative: Is It time to bottom fish?

Reliance Industries’ share price plunged 4% on Monday, hitting a nine-month low amid heavy selling. This decline turned the stock’s year-to-date (YTD) returns negative.

During intraday trading on the BSE, Reliance’s stock fell to ₹1,285.10 per share. This drop shrank the company’s market capitalization to around ₹17.40 lakh crore. Notably, the stock has declined over 20% from its 52-week high of ₹1,608.95, which occurred on July 8. As of November 4, Reliance shares are down 0.5% YTD, yet they have gained over 11% in the past year.

The Indian stock market also faced turmoil on Monday, with both benchmark indices, Sensex and Nifty 50, falling more than 1.5%. All sectoral indices reported steep losses, particularly Oil & Gas, Metals, Auto, and Banks. This broader market decline contributed to the pressure on Reliance shares.

Reliance Industries reported a 4.77% drop in its consolidated net profit for the September quarter, totaling ₹16,563 crore, down from ₹17,394 crore in the same quarter last year. The company’s total income in Q2 increased by 0.65%, reaching ₹2,40,357 crore, compared to ₹2,38,797 crore in the corresponding quarter.

RIL’s consolidated EBITDA for Q2FY25 fell 2% year-over-year to ₹43,934 crore. The EBITDA margin for the quarter stood at 17%, slightly down from the 17.5% recorded in the same period last year. Following these results, HDFC Securities maintained its ‘ADD’ rating, citing optimism due to a potential recovery in the O2C business and growth in the digital sector.

Currently, Reliance shares are trading near their 100-weekly moving average at ₹1,288, with crucial support at the ₹1,280 level, according to Milan Vaishnav, founder of ChartWizard FZE. He suggested that the decline in Reliance shares presents a buying opportunity for investors, recommending that new investors consider entering at current levels, with a stop loss around ₹1,265-1,270.

At 11:45 am, Reliance shares were trading 3.22% lower at ₹1,296.00 apiece on the BSE.