Future Retail, Future Enterprises, Future Supply Chain Solutions, and other Future group stocks crashed up to 20 per cent on Monday after Future Retail and Reliance Industries subsidiary Reliance Retail Ventures deal called off, with the majority of lenders voting against the takeover by the latter. RIL on Saturday said its Rs 24,713-crore deal to acquire Future Group’s assets cannot be implemented after secured creditors of the Kishore Biyani-led companies voted against the proposal.
“Presently, Future Retail stands at a pattern support of 27.85; the zone of 27.20-27.65 is a major support for the stock. Presently there are no triggers to go long here; however, if the stock bounces off from there, then fresh longs can be initiated with a SL of 27.20,” Milan Vaishnav, CMT, MSTA, Consulting Technical Analyst and founder, Gemstone Equity Research & Advisory Services, told FinancialExpress.com. Vaishnav advised investors to avoid this stock at current levels and wait for at least one technical bounce before attempting any long positions here.
Future Supply Chain Solutions stocks were down by 20 per cent at Rs 37.30, and Future Lifestyle Fashions stocks too tanked 20 per cent at Rs 29.40, touching their respective all-time lows in intraday trade on Monday. Future Market Networks too crashed 20 per cent to Rs 6.60 in intraday, and Future Consumer stock price also tumbled 20 per cent to Rs 3.90 on the BSE. While Future Retail share price was locked in the 5 per cent lower circuit at Rs 27.80.
“Fundamentally Future group stocks have been in bad shape for quite a while and hence investors should avoid buying at any levels as there seems to be no improvement in any way to be bullish on the Future group stocks,” AR Ramachandran, Co-founder & Trainer, Tips2Trades, told FinancialExpress.com. Ramachandran added that technically, Reliance industries has rallied quite well over the past 1 month and investors are advised to book partial profits at current levels. “Levels close to 2500-2530 will be good to re-enter Reliance industries for higher targets of 2980-3000 in the coming months,” he said.
Several listed Future Group entities – Future Retail Ltd, Future Enterprises Ltd (FEL), Future Market Networks Ltd, Future Consumer Ltd, Future Supply Chain Solutions Ltd and Future Lifestyle Fashions Ltd – in their respective regulatory filings on Saturday also said composite Scheme of Arrangement with Reliance Group entities now can not be implemented due to the outcome of the voting. On Friday, FRL had disclosed to the exchanges that while more than 75 per cent of shareholders and unsecured creditors had supported the deal with RIL, the company had failed to get the requisite 75 per cent favourable voting from secured creditors. A majority of 69.29 per cent of secured creditors of FRL had voted against the resolution, while 30.71 per cent had voted in favour of it.
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