R-ADAG stocks underperform

Latest rally sidesteps power, telecom, financial sectors.

The Reliance-Anil Dhirubhai Ambani Group (R-ADAG) scrips have consistently underperformed the market in the last 1,000-point Sensex rally from March 27 to April 21. The group companies have given returns ranging from 4.29 to 8.29 per cent at a time when the Sensex went up 8.58 per cent "" from 11,079 to 12,030.

In fact, the share price of one of the companies, Reliance Natural Resources, went down by 4.61 per cent from Rs 30.40 to Rs 29 in the same period.

While the Adlabs scrip went up by 8.29 per cent, the increase in share prices for the other group firms was 6.74 per cent (Reliance Capital), 5.16 per cent (Reliance Energy Ventures), 4.64 per cent (Reliance Communications Ventures), 4.46 per cent (Reliance Energy) and 4.29 per cent (Reliance Capital Venture).

Among the R-ADAG stocks, Adlabs and Reliance Capital fared relatively better largely on account of the former's aggressive expansion plans and the latter's move to make itself a financial powerhouse.

The four newly listed entities of R-ADAG have added Rs 1,902 crore market cap, and three other listed companies "" Reliance Energy, Reliance Capital and Adlabs "" a little over Rs 1,400 crore during the same period.

The major addition to the market cap of R-ADAG was contributed by Reliance Communication Ventures (Rs 1,675 crore), followed by Reliance Capital (Rs 706 crore), Reliance Energy (Rs 581 crore) and Reliance Energy Ventures (Rs 269 crore).

Analysts said the R-ADAG stocks remained lacklustre in the markets largely on account of the sectors in which the group operates.

Power, telecom and finance companies did not participate in the latest rally, which was driven by information technology, cement, capital goods and steel. The power sector stocks as a whole did badly, posting 0.45 per cent return.

In the same period, however, the Reliance Industries scrip has been scaling new heights. Reliance increased its market cap by Rs 25,000 crore during the 16 days the Sensex took to jump from 11,000 to 12,000.

Reliance also regained its top slot in the Sensex weightage, which it had lost to Infosys Technologies on January 18. The Reliance surge was largely on account of its retail splash and the success of the public offer by Reliance Petroleum Ltd, analysts said.