Friends, India's biggest company - Reliance Industries
the share price of this company used to trade at Rs. 2100 after increasing from Rs. 1000
and the company which provided great returns to its investors in the last few months
But if I talk about yesterday, Reliance Industries shares fell down to 9% in one day
but how such a big company's share fell so down in just one day? What's the reason behind it?
Whenever you invest in any company and the company you have invested in, comes with such news
or its shares show such drastic fluctuations
so, in this case, what should you do as an investor?
Let's talk about it in this video!
Firstly we will talk about Reliance Industries' quarterly results
and I will also talk about all those news and rumours
that was in the market and the reason why Reliance Industries's share dipped so much in a single day
and please do watch this video till the end as in the end, I will tell you whenever such a situation comes
whenever the shares of such a big company go down, what strategy you should come up in this situation
and how you should take investment decisions at that time
I, Jagdeep Singh, welcome you all to Groww YouTube channel
let's start today's video!
If I talk about the quarterly results of Reliance Industries, firstly I will discuss the profit
Reliance Industries has booked a profit of around Rs. 9560 Cr
But if we compare it to the same quarter of the last financial year
Back then, Reliance Industries had more than Rs. 1100 Cr profit in the same quarter
which means we can see a 15% drop in the quarter on quarter results
whereas talking about the revenue, in the last financial year's same quarter, the revenue breakup of Reliance Industries was almost 1,53,000 Cr
talking about this quarter, Reliance Industries has booked around 1,16,000 Cr of revenue
checking it year on year, we can see a 24% drop in the net revenue of Reliance Industries
the question which arises here is whnever there is a dip in the net profit of any company
does the company shares start going down continuously?
but this does not happen; whenever the quarterly resul comes for any company, there is an expectation before that
nd that expectation is set by the analysts or the people who research in the company
so, the analyst tells you whenever there is any result to come, what company expects from it?
if we talk about expectations in the case of Reliance Industries
the result was not bad than expectations, its was almost the same as expected
but when compared to the last financial year, so yeah we see a substantial drop here
both in company's revenue and profit as well
if you have read about Reliance then you must know that it's core business is of oil and then they got into Telecom sector with Jio
apart ftom that, they have expanded their business into retail as well
talking about its oil business, we can see a good hit there
as compared to last quarter
talking about last quarter, Reliance Industries refineries cleans the crude oil first
talking about last financial year's same quarter, the gross refining margin of Reliance Industries per barrel was $9.4 which was a healthy number
talking about this quarter, the gross refining margin has reduced to $5.7/barrel from $9.4/barrel
which means it has been hit
Coming to petrochemical business, last financial year's same quarter's revenue was around Rs. 38000 Cr
talking about this quarter, it has come down to 29000 Cr currently from 38000 Cr
so, this was the business of Reliance petrochemical, now let's talk about the profit from it
so in the last financial year, the company's profit from petrochemical business was around 7600 Cr
which has now decreased to 5900 Cr currently
which means it has also been hit
Reliance also told clearly in their quartrly results that they have raised 1,52,000 Cr of investment through Jio platform
which they have used to reduce debt as they have promised that they will be a debt free company in the future
Also, company has raised 37000 Cr through Reliance retail which is quite a good number and a good point for Reliance shareholders
also, talking about Jio's result it has performed good and the company's ARPU which used to be around 140 has now gone up to around 145
but when compared to Airtel, the ARPU of Jio is still very less
so these were the differrnt news which came around the quarterly resul and by seeing it it doesn't seem so bad to us
it was almost right as expected by the analysts in the quarterly results
but then what happened which caused Reliance Industries shares to go down
so whenever a company has its quarterly results, based on them, different analysts and companies
these companies come with their ratings for others and advice you whether you should buy those companies or sell them
coming to Reliance Industries, maximum analysts advised to buy or hold it
but there was a news which can be reason of the triggered sale of Reliance Industries
that resuly came from Macquarie and the rating it gave to Reliance Industries was of underperformed
so, Macquarie told that the closing price of Reliance Industries on Friday which was Rs. 2054
based on that they stated that Reliance Industries is underperforming and the expect the price to fall down by almost 42%
but a short disclaimer here - It is a direct news which I have quoted here
but there are different analysts that give their ratings; there is not only but 20-30 analysts that give ratings
it's not necessary that the share price will move as per the rating everytime but this was a fact which I told you
and which acted as a negative input in yesterday trading session due to which the share price of Reliance started going down
this was one potential reason, there could be many reasons apart from this
a small diclaimer here - I just told you about a fact here
this should not be a reason for you to buy or sell, this could be one of the reasons why the share price of Reliance Industries fell down
so, this was just about Macquarie, there are various rating agencies that tell their views on Reliance industries
some rating agencies have said that it will outperform in the future such as Goldman Sachs
there are many agencies that advises to buy or sell it and this is just a fact, you should do your own research and decide what to do
but this was a news due to which its shares started dipping yesterday
Reliance Industries was performing quite well from the past few months
but when it was trading around 2100-2200, there was a positive news that reliance has striked a deal with Future Group
and is going to buy it
and there was a negative news too which I won't get into detail because if I do, the video will become long
so that also brought some conerns into investors' mind
and after that, its quarterly results came and a Macquarie gave its ratings about its quarterly results
after that its share price started dipping and within one day, it went down by almost 9%
there was a rumour that was in the market that Mukesh Ambani is not keeping well
but there was no official statement on it and investors should not believe until there is an official statement
Until the company does not tell you or does a filing in the exchange, you should not believe these rumours
play with your sentiments and cannot stop you from investing fundamentally in any company
so the important thing here is you do your fundamental research and after that only you decide whether you want to invest or not
the question which arises here is whenever we see such volatility in a company and if you have invested or thinking to invest
what to do in such case as an investor?
as I have said in every video that whenever you invest in a company, you do it for long term after seeing a fundamental value
so that you can make a good value in the longer term
so if you have invested in any company after a good research
you are thinkking that the company wil perform good in the future as fundamentally the business of the company is very good
and the segment in which it is trying to grow, it has performed well there
so in these cases whenever there is a volatility or its share price go down due to any rumours
so if your fundamental research was good and there is no material impact on companys business
you should not panic and you should invest for long term
but whenever there is a news related to the ccompany's corporate governance or fraud and scam
in that case, you should rethink about your investment for sure
so this should be your investment strategy - always invest for long term
check the company fundamentals, until there is an impact in company's fundamental business you should not panic as an investor
because whichever company has made a good value in the longer terms
you can take any company; Reliance has also made a good value earlier to its investors
so, in every company, there are ups and downs but they don't last longer
if the comoany is good in the long term and make you a good profit, you should not panic a bit
let's discuss some of the questions asked by our viewers in the last video. First question is of Rupesh
he asks that he bought a stock within a record date so will he get the dividend
so friends, record date means the date on which that share should be in your Demat account
if it's in your Demat account, you will officially the shareholder
if you are buying 2 days prior to record date and before the record date, if that stock comes to your account
in that case, you will get the company's dividend
but if you are buying in record date, the delivery to your account will take place after 2 days
which means you won't get that company's dividend
so please take care in future that the stock should be in your Demat account on company's record date
and to make that happen, you have to plan accordingly and buy the stock 2-3 days before
so that the stock is in your Demat account on the record date
if it's in your demat account, you will be a shareholder and officially you'll get the dividend of that company
nest question is from Mayur and he asks we give one bank account while opening Demat account
in tht bank account, you receive the dividend money sent by the company
he wants to know that can he change his default bank?
So, Mayur, yes you can do it very easily by asking your broker to change the account no. associated with your Demat account
whwnever you go to your broker, every broker has their own process
and by following that process, you can change your bank account
once your account no. is changed, the dividend will come to your new account
so, yes it's possible to change your bank account and you just ask your broker about the process
and following the process, you can change your bank account
we hope that you have liked today's video, if yes, then please hit the like button
comment and tell should you buy Reliance Industries shares in this time or not
and in the end, I will again tell you
there are various news in the market to make you panic but
as a valued investor, as a long term investor, you should focus on your long term investment
so that you can make a good return in the long term
and I hope that as a good investor, you will do good research and invest for a long term
Happy Investing!