Reliance Industries stock snaps nine-day winning streak on arbitration penalty

The Reliance Industries stock on Tuesday snapped its nine-day winning streak amid reports that the government has sought about $3 billion from Reliance Industries, Royal Dutch Shell and ONGC following a "partial" arbitration award in its favour over cost recovery in Panna/Mukta and Tapti (PMT) oil and gas fields in the Arabian Sea.

The stock closed 2.03 percent or 31.45 points lower at 1,519 level on the BSE.

The Directorate General of Hydrocarbons (DGH) in May-end slapped the demand notice on them, which included interest and certain other charges over a gross amount it calculated following the October 2016 final partial award (FPA), sources in the government and the PMT joint venture said.

The notice does not contain any date for making the payment or the consequences that would follow if the payment is not made, they said. Besides, they added, it was issued without waiting for the arbitration panel to give its final award after hearing rejoinders from the parties to the dispute and, in the last stage, quantifying the amount payable.

It hit a new nine-year high level of 1524 on July 12 on Jio's revised tariff rates. Reliance Jio Infocomm raised the effective rates of its services with effect from July 11, 2017. The new plans entail reduced data and validity for the telco's services.

On July 17, the stock continued to rally and hit a fresh nine-year high of 1,558 level on the BSE. It is up 50 percent on yearly basis and 40 percent on an year-to-date basis.

On Monday, Reliance Industries attained a market valuation of over Rs 5 lakh crore, becoming the second firm after TCS to achieve this milestone. At close of the trade, the market capitalisation (m-cap) of RIL stood at Rs 5,04,458.09 crore, making it the most valued company in the country. Shares of the company rose by 1.33 per cent to settle at Rs 1,551.35 on BSE.

Today, the stock closed with a market capitalisation of Rs 4.94 crore on the BSE.