Reliance falls as dismay over scrapped Aramco deal persists

NEW DELHI: Shares of shed about 1 per cent in early trade Wednesday as investors continued to fret over the scrapping of a proposed deal to sell a 20 per cent stake to Saudi Aramco even as Moody’s Investor Services said that the move will not affect the Indian conglomerate’s credit quality.

The scrip touched a low of Rs 2,364.05 on the National Stock Exchange as against Rs 2,385.85 at the previous close.

Reliance’s shares have witnessed significant volatility after the development which was announced late Friday.

After losing 4 per cent on Monday – a price action which eroded around Rs 66,000 crore in market value – Reliance’s shares had tumbled 2 per cent further on Tuesday. However, by the end of the day, the stock rebounded, gaining 0.9 per cent.

The changing nature of the business portfolio has prompted Reliance and Saudi Aramco to mutually determine that it would benefit both parties to undertake a re-evaluation of the planned investment in the O2C (oil-to-chemical) business, the Indian conglomerate announced.

The 20 per cent sale of stake in the unit was announced in 2019 but was put on the backburner because of the outbreak of the COVID-19 pandemic and the subsequent crash in global oil prices due to low demand.

Reliance shall carry on being Saudi Aramco's preferred partner for investments in India’s private sector and will collaborate with the company and the Saudi Arabian Basic Industry Corporation for investment in the West Asian country, the Indian company said.