Comprehension of Technology and Market Capitalization
Reliance Industries, the first Indian corporation to take a place in the Fortune 100, is solid proof that capitalism is on firm footing in the Indian soil.
The tumbling of Reliance Industries shares, during the AGM which took place this morning and reported by indiainfoline.com, is a good example why the stock market can not be taken for granted and corporates need to explain their business in common mans language.
As a stock trader, I try to observe and analyze the behavior of the Indian stock market, wearing a straight jacket of established principles, widely published in the west.
It is quite interesting to see that, in many cases, the market actually react quite contrary to your expectations for unknown and bewildering reasons to corporate announcements of results and intentions.
This morning, the share of Reliance Industries opened a percent or so up at the opening of the market, holding well until the commencement of the AGM and the beginning of the speech by the chairman Mukesh Ambani.
However, the shares started falling during the course of the speech and ended up pretty down by the end of the speech, slipping even more by the close of the market.
As it is one of the weighted shares in the NIFTY, you may say it even helped to pull the index down.
You would have assumed that Mukesh Ambani must have declared his intention to close down Reliance Industries over the course of the next year for such a dismal reaction from the share holders!
The speech was in fact one of the best pitches I heard in recent memory which could have easily persuaded Warren Buffet to catch the next flight to India despite his recent exploration of the Indian investment jungle!Continued on the next page