The central government has increased the excise duty on the export of petrol, diesel and ATF. Since then, there has been a sell-off in the shares of companies associated with the refinery.
Reliance Industries Stock Price: In today’s business, the shares of Mukesh Ambani’s Reliance Industries (RIL) are seeing a huge decline. In trading, the stock weakened by 9 per cent to Rs 2370, while it closed at Rs 2596 on Thursday. In fact, the central government has increased the excise duty on the export of petrol-diesel and ATF. On petrol, the export duty has increased by Rs 5 per liter and on diesel by Rs 12 per liter. Due to this, the shares of companies with refinery business have collapsed. Apart from RIL, shares of companies like ONGC, Mangalore Refinery (MRPL), Chennai Petrochem have also weakened.
What do experts have to say
Santosh Meena, Research Head, Swastika Investmart Ltd, says that RIL is witnessing a sharp decline after the government imposed tax on windfall profits being taken by domestic refinery companies. The central government has increased the excise duty on the export of petrol, diesel and ATF. This has put some pause on the refinery business of the company. Because the commodity cycle is also reversing. However, other verticals have strong growth potential. Some investors will look for buying opportunities in this correction ahead of the July-end AGM. Some big announcements in the AGM can give a new direction to the stock.
What do investors do in shares
RIL Technical investors should keep an eye on the 2400-2350 demand zone in RIL as recovery is expected if the company manages to maintain this level. But if it slips below the level of 2350 then it can move towards 2200. On the upside, there is a strong resistance at the 2600 level. On breaking this, the stock can go to new highs.
Export Duty Hike: Government increased export duty on petrol, diesel and ATF, what will be the effect on common man
Other stocks also fell
Shares of Chennai Petrochem saw a fall of up to 13 percent and it weakened by Rs 273. Mangalore Refinery stock fell nearly 10 per cent to Rs 83. On the other hand, ONGC shares fell more than 12 percent and it came close to Rs 133. The Oil and Gas Sector Index of BSE has declined by 3.5 percent. Gail, IOCL, ATGL and IGL also saw weakness in the sector.
(Disclaimer: Stock investment advice is given by experts. These are not the personal views of The Financial Express. Markets are risky, so take expert opinion before investing.)