The gains come after both stocks shed nearly 30% over the past three months, erasing much of the optimism that greeted Ambani’s corporate comeback earlier this year. Over the past year, Reliance Power has remained higher by 52% and Reliance Infra by 20%, but that is a sharp comedown from May peaks, when the two had rallied 173% and 141% respectively over 12 months.
Technical signals mixed
From a technical standpoint, Reliance Infra remains under pressure. The stock trades below seven of its eight key simple moving averages, including the 10-day and 200-day, with its Relative Strength Index at 34, just above oversold levels. Its Moving Average Convergence Divergence (MACD) stands at -14, a strong bearish signal.Reliance Power’s chart looks somewhat firmer, trading above five of its eight SMAs, including the 200-day, though its RSI at 42.9 and MACD at -1.3 also reflect bearish undertones.
Legal shadows deepen
The bounce came despite mounting legal risks for Ambani. The Enforcement Directorate has filed a fresh case under the Prevention of Money Laundering Act against him, Reliance Communications and others, alleging they defrauded the State Bank of India of more than Rs 2,900 crore. The case stems from a Central Bureau of Investigation complaint in August that triggered raids at Ambani’s residence and Reliance Communications’ offices.Ambani has “strongly denied all allegations and charges,” saying he has been “selectively singled out” over matters dating back more than a decade, when he served as a non-executive director at Reliance Communications. Adding to the cloud, Bank of Baroda this month classified Reliance Communications’ loans as “fraud,” following similar moves by SBI and Bank of India.
Earnings offer little relief
Both companies returned to profitability in the June quarter. Reliance Power reported a Rs 44.68 crore profit, reversing a Rs 97.85 crore loss a year earlier, though revenue declined 5.3% to Rs 1,885.58 crore. Reliance Infra earned Rs 59.84 crore versus a Rs 233.74 crore loss last year, but sales slid nearly 18% to Rs 5,907.82 crore.
“Reliance Infrastructure has corrected sharply but showed signs of repair in Q1 FY26,” said Harshal Dasani, Business Head at INVasset PMS, pointing to tighter costs and arbitration progress. “While unrelated to R-Infra’s operations, this headline risk can weigh on multiples.”
Recent wins in energy
Reliance Power last week announced it had secured a 500 MW/1000 MWh Battery Energy Storage System contract from the Solar Energy Corporation of India, marking its entry into renewable storage. The project, to be delivered at SECI’s Fatehgarh substation in Rajasthan, is slated for commissioning within 24 months.
Separately, Reliance Infra in mid-August bagged a 390 MW solar power plus 780 MWh battery storage project from NHPC, underscoring its tilt toward clean energy.
Outlook
Dasani said Reliance Infra’s performance over the next two quarters hinges on execution in EPC projects, arbitration cash inflows and cost controls. Reliance Power’s trajectory, he added, depends on stable operations at its Sasan and Rosa plants and timely discom payments.
Still, analysts caution that any operational progress could be eclipsed by investigations linked to Ambani. For investors, the question remains whether the fragile rebound can withstand intensifying legal scrutiny, or whether it marks another fleeting uptick in the long-stalled turnaround of Ambani’s debt-laden empire.
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(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
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