InvestorQ : I had recently bought shares of Reliance Infra and Reliance Power after the correction in prices. Should I hold on to the stocks?
Lavanya Subramanian made post

I had recently bought shares of Reliance Infra and Reliance Power after the correction in prices. Should I hold on to the stocks?

Answer
user profile image
ishika Banerjee answered.
1 year ago


Both the stocks are quoting at multi year lows. Reliance Infra is quoting at its lowest price in the last 16 years while Reliance Power is at an all time low of below Rs.5. The ADAG group companies have been missing debt payments and that has turned stock market sentiments against all the group companies. Also, in the case of Reliance Power, the results were announced very late and Reliance Infra is yet to announce results for the fourth quarter. That is not a comfortable situation to be in.

Reliance Power announced a net loss of Rs.3559 crore in the fourth quarter due to impairment loss on assets to the tune of Rs.4170 crore. This raises the question why this impairment was not shown earlier. Most of the group companies have corrected nearly 80-90% in the last one year so there is no point in holding on to any of these stocks at this point of time.