Reliance Industries shares fall after Kotak cuts price target
Pratip Chaudhuri, chairman of the State Bank of India, said reducing the cash reserve ratio (CRR)—the amount of deposits that banks must keep with RBI—to 4% will free up about Rs 7,500 crore.
Reliance Industries lost 1.3 per cent to Rs 737.10 after Kotak cut its price target for the stock, citing "conflicting" company signals on the use of cash, "confusing" news from exploration and production, and "continuing weakness" in chemicals and refining margins.
The brokerage cut its sum-of-the-parts target price to Rs 800 from Rs 830, while maintaining its "neutral" stance on Reliance, becoming the latest investment house to deliver warnings about the company's earnings outlook.
Kotak analyst Sanjeev Prasad further warned of risks from lower recoverable reserves from Reliance's KG D6 block, as well as declines in chemical margins for naphtha-based crackers.
Reliance shares have been hit hard in March, with the stock down 8.6 per cent, far above the 1.7 per cent fall in the Nifty last month, due to worries about its earnings.
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