Widening gap: Why RIL earnings have lagged behind the rise in its m-cap

Its m-cap is up 150 per cent in 12 quarters, against 24 per cent cumulative growth in net profit

Reliance Industries (RIL) was the biggest loser among index stocks on Monday. It closed the day with losses of 8.7 per cent, against 0.2 per cent rise on the Nifty50 index during the day. This was a sharp reversal for a stock which has been the biggest market mover in the past six months. RIL’s market capitalisation (m-cap) is, however, still up 75 per cent since the end of March this year, accounting for nearly 30 per cent rise in Nifty during the period.

Analysts say the recent decline in RIL’s stock price was long overdue, given its earnings have lagged