RIL scrip falls for fifth day in a row on the bourses on HSBC downgrade

Extending its decline for the fifth straight session on Thursday, shares of Reliance Industries Ltd (RIL) fell by over 1 per cent on Thursday on the bourses amid media reports that banking major HSBC has downgraded the energy major to "neutral" from "overweight".

Continuing its fall for the fifth straight session, the company scrip plunged 1.42 per cent to its almost two-year low at Rs 888 a piece on the BSE. This was its lowest close since July 2009. During intra-day trading, the stock shed 1.73 per cent to Rs 885.10 a piece. On the NSE, the scrip dropped 1.61 per cent to Rs 886.05 after hitting a 52-week low of Rs 884.10 during intra-day.

In the past four trading sessions, RIL's counter has shed over 5 per cent.

Analysts said the bellwether stock has come under further selling pressure after a recent report by the Comptroller and Auditor General (CAG) said the Oil Ministry and its technical arm, the DGH, allegedly favoured RIL by allowing it to double the development cost of its landmark KG-D6 gas field.

However, the company has denied any wrongdoing.

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According to media reports, HSBC has downgraded RIL to "neutral" from "overweight" and cut the price target to Rs 1,040 from Rs 1,084.

Meanwhile, the Home Ministry has given unconditional approval for UK's BP to buy a 30 per cent stake in Reliance Industries' oil and gas blocks, including the showcase KG-D6 gas fields, for $7.2 billion.

RIL has underperformed the benchmark Sensex by 12 per cent over the last three months on concerns of falling gas production from its KG-D6 block, HSBC said, as per the media reports.