Reliance Infra, Reliance Power shares tumble up to 15% in 5 days: Here's what triggered the selloff

Shares of Anil Ambani-led Reliance Group companies have witnessed a sharp decline over the past five trading sessions amid an Enforcement Directorate (ED) probe into an alleged fraud. Reliance Infrastructure shares have fallen by 14% in the past five sessions to touch a low of Rs 281.25 on Tuesday, while Reliance Power has tumbled 15% to Rs 45.32 on the BSE during the period. The slide comes after reports that the ED is set to question bank officials involved in a Rs 17,000 crore loan fraud case linked to the group.

The Enforcement Directorate (ED) on Monday issued summons to several top executives of the Anil Ambani-led Reliance Group in connection with an ongoing money laundering investigation, a day before Ambani is slated to appear before the agency, according to an Economic Times report.

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According to Times Now sources familiar with the development, senior group executives, including Amitabh Jhunjhunwala and Sateesh Seth, are among those summoned. The ED has reportedly issued at least six summons under the Prevention of Money Laundering Act (PMLA) so far, the report further said.

Loans to group firms—Reliance Home Finance Ltd, Reliance Commercial Finance Ltd, and Reliance Communications—amounting to around Rs 17,000 crore have reportedly turned into non-performing assets (NPAs), involving nearly 20 lenders.

The ED’s action follows a series of searches conducted last week at multiple premises associated with the group. The searches were reportedly carried out at 35 locations across Mumbai, encompassing 50 companies and 25 individuals.

In a parallel but related development, the Securities and Exchange Board of India (Sebi) has submitted the findings of its probe to the ED, as well as to the National Financial Reporting Authority (NFRA) and the Insolvency and Bankruptcy Board of India (IBBI).

Sebi's investigation pertains to an alleged diversion of Rs 10,000 crore by Reliance Infrastructure (R Infra) through a series of transactions with an engineering firm named CLE Pvt Ltd.

According to SEBI, evidence collected during the investigation indicates that CLE was functionally a related party of R Infra. Documentation cited by the regulator included submissions by CLE to Yes Bank, where it acknowledged Reliance Infra as a promoter. Internal records, such as audit committee meeting minutes, reportedly identified CLE as a “group company.”

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Additionally, the regulator found that bank accounts operated by CLE bore email addresses using the “@relianceada.com” domain, which corresponds to the Reliance ADA Group. Statements from key managerial personnel (KMPs) recorded during the probe, along with the fact that several directors and executives of the Reliance Group held positions in CLE, were also cited as supporting evidence.

In the last one month, the shares of Reliance Infrastructure have fallen by 24.82% whereas in the last three months, it has surged by nearly 9%.

In the last month, shares of Reliance Power have gone down by 31% whereas in the last three months, the stock price has gone up by 11.21%

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