ADAG gains Rs 5,500 cr in M-Cap in 7 trading sessions

R-Jio pact and news of a deal with Batelco boost sentiment

The Anil Dhirubhai Ambani Group (ADAG) has gained over Rs 5,500 crore or 12.7 per cent in market capitalisation over the last 7 trading sessions. In the same period the Sensex has fallen by 1.4 per cent as foreign institutional investors (FIIs) have sold heavily.

ADAG shares have been under extreme pressure over the past couple of months and its four major companies witnessed share prices fall by over 20 per cent between February 25 and March 26.

While Reliance Communications fell by 35 per cent during the period,Reliance Infrastructure,Reliance Capital and Reliance Power fell by 31,26 and 25 per cent,respectively. However,they witnessed a significant jump after Reliance Jio Infocomm,a subsidiary of Reliance Industries,signed an Rs 1,200 crore agreement for sharing RComs nationwide optic fibre network.

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ADAG shares also witnessed a thrust following news reports that Bahrain Telecommunications Company will buy 80 per cent stake in RComs subsidiary Reliance Globalcom for around Rs 6,000 crore. RCom shares have risen by 29 per cent over the last seven trading sessions,while shares of Reliance Power rose by 10 per cent and Reliance Infrastructure and Reliance Capital rose by 5.6 and 4.6 per cent,respectively,in the same period. Reliance Mediaworks and Reliance Broadcast shares also rose by 5.9 and 3 per cent,respectively.

The positive investor sentiment on the group firms helped the total market cap of ADAG rise to Rs 48,874 crore on April 8,2013,from Rs 43,361 crore on March 26,2013 a Rs 5,512 crore gain.

Market experts say that agreement with Reliance Industries has certainly helped RCom. RCom has gone up because of all the positive news that will help in reducing debt of the company, said SP Tulsian,an independent market expert. If RIL comes as a tenant and as a user of its towers then they will be able to find buyers for their assets.

Batelco,however,on Monday in a statement to the Bahrain Stock Exchange said that there can be no certainty that any interest we expressed to Reliance Group will lead to a transaction. It added that a further announcement will be made in due course.