Share prices of Anil Dhirubhai Ambani Company stocks (ADAG) dropped on Wednesday after Telecom Company Reliance Communications (Rcom) defaulted on interest payments. Reliance Capital plunged 10. 21 percent and Reliance power fell 8.55 percent on BSE. Among other Anil Dhirubhai Ambani Group (ADAG) group companies Reliance Naval and Engineering dropped 8.18 per cent, and Reliance Home Finance was down 7.09 percent. Newly-listed Reliance Nippon Asset Management fell seven per cent and even slipped below its initial public offering. Shares of Reliance Infrastructure plunged 9.2 per cent, extending its monthly loss to 17 per cent. Reliance Capital’s share price declined 10.2 per cent, stretching its loss this month to 27 per cent.
Reliance Communications reported a consolidated loss of Rs 2,709 crore in the second quarter ended September 30, 2017 (against a profit of Rs 62 crore last year). Total income of the company declined by 48 percent to Rs 2,667 crore against Rs 5,142 crore last year, as it witnessed a decline in revenue from both its India and global operations. The company also said in a securities filing over the weekend that it has missed interest payments on two of the outstanding domestic non-convertible debentures. The finance cost of the company, which is reeling under a debt of around Rs 45,000 crore, increased to Rs 1,149 crore during July-September 2017, as compared to Rs 825 crore a year ago.
The 2008 debacle of Reliance Power’s listing had triggered a nearly 4-5 per cent crash in the Sensex and the Nifty. But this time sharper fall in indices may not happen as none of the ADAG group companies is currently part of these indices, market experts said. So the debacle seems unlikely as of now.