- Reliance Industries share price is reacting to broader market weakness, but its fundamentals stay strong despite selling Asian Paints stake.
Reliance Industries share price has extended the downside for the second successive session as investors book profit amid a broader market weakening. The stock traded at Rs 1,432 at the time of writing and was down by 0.4% on the daily chart. Reliance Industries (BSE: RELIANCE) share price is climbing down from an eight-month high of Rs 1,468 set on Tuesday, but retains strong fundamental support.
Equities markets are currently under pressure as investors divert their funds to safe haven assets like gold and government bonds on the back of escalating geopolitical risk in the Middle East. For Reliance shareholders, however, this is a good time to cash in, not primarily out of fear, but out of a drive to reap a good harvest that has been eight months in the making.
Meanwhile, the company’s move to sell its Rs 77 billion worth of stock in Asian Paints has also caused some disruption. However, this seems like a strategic exit. Reliance invested about Rs 500 crore (approximately $60 million) in Asian Paints in 2008 for a 3.6% stake, and it has made a tidy return of about 23X in the last 17 years. Furthermore, Asian Paints has been facing stiffening competition, which has seen its market share contract from 56% to 52% in the last year.
Looking ahead, Reliance Industries share price will likely stay on the ascending trajectory in the medium term. The company’s fundamentals remain stable and recent upbeat coverages by analysts at JP Morgan and Jefferies have all given it a “buy” rating, adding credence to its strong outlook.
Reliance Industries Share Price Prediction
The momentum on Reliance Industries share price calls for further downside below Rs 1,440 pivot. The stock will likely find initial support at Rs 1,420. However, a stronger momentum will break below that level and could test the second support at Rs 1,403.
Conversely, the momentum will likely shift to the upside if the price breaks above Rs 1,440. In that case, the stock will likely rise to encounter the first resistance at Rs 1,453. The downside narrative will be invalid above that level. In addition, an extended control by the buyers could push the price higher and test Rs 1,470.
