Shares of Reliance Industries, India's largest company by market capitalisation, fell nearly 3 per cent on Monday after the conglomerate posted a bigger-than-expected drop in its first-quarter profit late on Friday.
Weak demand and a steep fall in refining margins impacted the company's flagship oil-to-chemicals (O2C) business, contributing to the profit slide.
The fall in Reliance's shares, their steepest in two weeks, lead losses on the benchmark Nifty 50 index. The Mukesh Ambani-led company is the heaviest stock in the index with a 10.21 per cent weightage.
Reliance's O2C business, which grew post the pandemic on higher demand for fuels, has now seen refining margins fall from record levels hit last year.
Earnings before interest, taxes, depreciation, and amortisation (EBITDA) fell 6 per cent from a year earlier in the business.
Analysts at BOB Capital Markets, however, believe that EBITDA in the segment is expected to come off its peak but remain resilient over the next two years.
Published 24 July 2023, 05:13 IST