Anil Ambani group shares slide further; FIIs stare at Rs 2,000 cr of losses

The sell-off in Anil Ambani group companies amid the continuing fall is share prices has made foreign institutional investors (FIIs) jittery. Taking into account the shareholding pattern of listed group companies, FIIs are staring at a loss of Rs 2,392 crore on their equity exposures to these companies, in the space of a month.

According to data compiled by BS Research Bureau, shares held by FIIs in these group companies were valued at Rs 4,226 crore as on December 31. After Thursday’s closing, the value of these shares stood at Rs 1,833 crore.

On Thursday, the companies’ shares fell in the range of 2-28 per cent on the BSE. Reliance Infrastructure (RInfra) was worst-hit, with shares falling 28 per cent, extending its weekly fall to 58 per cent.

Among domestic investors, mutual funds (MFs) have seen an erosion of Rs 382 crore on their equity investments over a one-month period.

Life Insurance Corporation of India (LIC) is also staring at losses of Rs 757 crore during the same period. The insurer held a stake in most of the group firms — 4.16 per cent stake in Reliance Capital, 6.3 per cent in RInfra, 4 per cent in Reliance Power, 7.9 per cent in Reliance Naval and Engineering, 5.96 per cent in Reliance Communications (RCom), and 2.17 per cent in Reliance Home Finance.

 

According to experts, the fall in share prices could have triggered some margin calls, leading to some of the pledged shares getting off-loaded in the market.

Reliance group firms have a high percentage of promoter shares pledged. According to data compiled by BS Research Bureau, RInfra, Reliance Power and Reliance Naval have 80-100 per cent of the promoters’ shares pledged, as on December 31.

Meanwhile, a note by Edelweiss points out that promoters’ pledging in RInfra has risen from 66 per cent to 83.6 per cent over the last five quarters.

In a clarification to the exchanges on Thursday, Reliance Naval said the company cannot comment on the movement in prices on the bourses. "Appropriate disclosures will be made in accordance with applicable regulations, as and when a disclosable event occurs." The group did not comment on the developments.

According to bulk deal data on the NSE, L&T Finance sold Rs 234 crore worth of shares of Rcom, Reliance Capital, RInfra and Reliance Power, on Thursday. The share sale accounted for 2.3 per cent of the market cap of these group firms.

Among FIIs, CLSA Global Markets held 1.53 per cent stake in RCom, while entities related to Morgan Stanley held 3.23 per cent stake in Reliance Naval.

Among MFs, Aditya Birla Sun Life Trustee held 1.72 per cent stake in Reliance Home. HDFC Trustee Company and IIFL Special Opportunities Fund held 3 per cent and 1.3 per cent, respectively, in Reliance Nippon Life Asset Management.

During the week, the companies have seen a sharp fall triggered by news that RCom will file for insolvency at the National Company Law Tribunal. With the exception of Reliance Nippon, shares of the group firms have fallen 28-58 per cent during the week.