Reliance Power, a key player in the Indian energy sector, saw its shares plummet 5% to Rs 45.20 on Wednesday, marking the third consecutive day of hitting the lower circuit limit. This sharp decline comes amidst ongoing developments involving Reliance Group Chairman Anil Ambani.

ED Questioning and Alleged Fraud

The stock's downturn coincides with Anil Ambani's appearance before the Enforcement Directorate (ED) for questioning in connection with an alleged Rs 17,000 crore bank loan fraud-linked money laundering case. The case reportedly involves intricate financial dealings, including:

• Alleged arrangements with bankers
• Suspicious investments through shell companies
• Forged bank guarantees

Stock Performance and Market Reaction

Despite the recent setbacks, Reliance Power's stock has shown resilience over a broader timeframe:

However, the current situation has triggered significant market activity:

• Trading volume surged to 2.28 times the 30-day average
• In contrast, the broader NSE Nifty 50 index experienced a relatively modest decline of 0.50%

The heightened trading volume suggests increased investor interest and potential market concerns surrounding the ongoing investigation and its implications for Reliance Power and the broader Reliance Group.

As the situation unfolds, investors and market watchers will likely keep a close eye on further developments related to the ED investigation and its potential impact on Reliance Power's financial standing and market performance.

Shares of Anil Ambani-led Reliance Group companies experienced a significant decline of approximately 5% following reports of an Enforcement Directorate (ED) investigation into an alleged Rs 17,000 crore loan fraud case. The news has sent ripples through the market, affecting multiple companies within the group.

Stock Performance

• Reliance Power saw a 5% drop, with its share price falling to Rs 47.58.
• Reliance Infrastructure experienced a decline of 4.98%, with shares trading at Rs 296.15.
• Reliance Home Finance shares fell by 4.84%, reaching Rs 4.84.

Investigation Details

The Enforcement Directorate is reportedly planning to question officials from both public and private sector banks that provided loans to Reliance Group entities. The agency has already summoned Anil Ambani as part of its investigation. The ED's primary focus is to understand the actions taken by banks after group companies defaulted on loan repayments.

Loan Default Allegations

According to reports, loans totaling around Rs 17,000 crore to various Reliance Group companies have allegedly become non-performing assets. The companies involved include:

• Reliance Home Finance Ltd
• Reliance Commercial Finance Ltd
• Reliance Communications

The case reportedly involves nearly 20 lenders, highlighting the scale of the alleged fraud.

Technical Analysis

A brief look at the technical indicators reveals:

Reliance Power and Reliance Infrastructure are currently in oversold territory, while Reliance Home Finance remains in neutral territory based on their Relative Strength Index (RSI) values.

The ongoing investigation and its potential implications have clearly impacted investor sentiment towards Reliance Group companies. As the ED probe unfolds, market participants will be closely watching for further developments in this high-profile case.