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Shares of Reliance Power and Reliance Infrastructure each plummeted 5%, hitting their respective lower circuit limits on the BSE, after the Enforcement Directorate (ED) launched large-scale raids in connection with a INR 3,000 crore bank loan fraud involving companies linked to Anil Ambani. The ED is investigating suspected money laundering and loan diversion tied to loans disbursed by Yes Bank between 2017 and 2019. While both firms emphasized that these developments bear no impact on their operations or governance, investor concerns triggered a sharp market reaction.
Reliance Power and Reliance Infrastructure witnessed a sharp decline in their stock prices, each falling 5% to their respective lower circuit limits after the Enforcement Directorate (ED) carried out widespread raids in connection with an alleged INR 3,000 crore bank loan fraud. The sell-off reflected investor jitters despite the companies' attempts to clarify their non-involvement. Advertisement
On the Bombay Stock Exchange, Reliance Power slipped to INR 59.70 apiece, while Reliance Infrastructure dropped to INR 360.05 both breaching their daily permissible loss threshold.
The ED launched simultaneous searches across more than 35 locations in Mumbai, targeting premises linked to around 50 companies and 25 individuals. These operations are part of an ongoing probe under the Prevention of Money Laundering Act (PMLA), spearheaded by the agency's Delhi-based investigation unit. The case reportedly revolves around loans granted by Yes Bank to Anil Ambani-led Reliance Group entities between 2017 and 2019, which are suspected to have been illegally diverted.
Both Reliance Power and Reliance Infrastructure issued formal responses through stock exchange filings, firmly stating that the enforcement actions have no effect on their business operations, financials, or stakeholders. Reliance Power highlighted that the media reports appear to relate to historic transactions involving Reliance Communications (RCOM) or Reliance Home Finance Limited (RHFL), both of which are legally and financially separate entities. The firm emphasized that it has no linkages either operational or fiscal with RCOM or RHFL.
Reliance Power also noted that RCOM has been under a corporate insolvency resolution process for over six years under the Insolvency and Bankruptcy Code, 2016, while RHFL's case was fully resolved following a Supreme Court judgment. Furthermore, it was clarified that Anil Ambani is not a board member of Reliance Power, distancing the company from any governance fallout linked to the enforcement actions.
Meanwhile, Reliance Infrastructure echoed similar sentiments in a separate filing, asserting its status as a standalone entity with no connection to RCOM or RHFL.
Public disclosures also highlighted that similar allegations to those reported in the media are already sub judice and currently pending before the Securities Appellate Tribunal.
Despite the strong corporate rebuttals, the market sentiment reflected a cautionary stance, likely driven by regulatory uncertainty and historical baggage associated with Anil Ambani's business empire.
Source PTI
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