Reliance is cyclical. Review on Reliance Industries

Reliance Industries is a cyclic share in the stock market. It means that the share would go to the bottom and then rise to the brims.

You will always be benefited if you can buy the reliance at the lows and sell it at its heights. Just to find out when it is low, you only have to look in to its price history . Same is the case with the highs.

The important point to remember is that unless you sell the Reliance shares you won't get profits.

Some companies like Dr.Reddy labs, infosys, eicher motors, Hindustan Construction have proved themselves as 10 bagger (eicher motors) to 100 baggers (Dr.Reddy’s lab) if only you do not sell them.

Which means that had you invested Rs.One lakh in Reddy labs 1990 and did not sell it means that you now holding shares worth Rs. One crore or 10 million rupees.

In this way what Reliance gave to investors is not that much as it has been hyped about.

For example on lakh invested in Reliance Industries in 1990 would have yielded about 25 lakhs.

It is very common knowledge that even when the old Ambani lived they secretly operated on the market with the full knowledge of their company and made themselves fat and rich. As much rich as TATA's.

It is also common knowledge that patriarch Mr.Ambani played his game extremely well by greasing the palms of politicians.

When India Gandhi was down and out and lost her own Loka sabha seat Mr.Dhirubai Ambani supported her and his calculations were correct. She came back to power sooner than any body could expect. Once she was in power she gave away boons to Mr. Ambani's Reliance Industries like Durga who will give boons and later fight with the same creatures.

Congress govt. of Indira Gandhi gave so many exemptions and at the same time increased import duties on all the goods manufactured by reliance to an unreasonable level. This has forced all the textile mills to buy the fiber from Reliance or become sick.

Sure , Reliance would increase the price of fiber made from purified terapthalic acid (PTA) and play on the stock market as well with engineered and hidden profits ?

Later on they came out with Reliance Petro and effectively disappointed all the share holders , by merging this company with Reliance. Ambanis and their relatives could buy large chunks in to the main Relaince Industries by this route. But Reliance Petro shareholders were taken unawares and disppointed by a very low ratio. It was a cruel joke.

As they became powerful now with public money , Mr.Dirubhai understood that Congress days were over and BJP days were set in. His judgment was very correct and he was a very shrewd businessman after all. This time he played his cards very well with BJP as his trump card. Yes, ! BJP came to power which was mind boggling because in a previous election to that one BJP got only two seats in the entire Indian Nation and that too one of them from Warangal ( AP) because of seat adjustment. Any way we should appreciate Mr.Dhirubahi for this and he was very much helped by another factor that Mrs.Indira Gandhi was now missing ! Other wise even the devils would not dare !!

Now Mr.Dirubhai was very much helped by BJP.

Unfortunately a great business man gone with the demise of Mr.Dhirubahi Ambani.

He was the only one who understood that Indian common public has lots of money to invest if only you know how to take it from them . This was as late as 1978. He was a genius in that aspect.

He proved by collecting money through public issues ( primary market) from the public and whatever was his promoters share of investment in whatever way he might have managed it , he was real genius , a force to reckon with. He was right in his judgment and he collected money from public ,so naturally the number of investors ( shareholders) is the highest in India's corporate history ! I think the number of share holders in Reliance Industries is about 40 lakhs or 4 million.

The early investors from 1978 onwards were immensely benefited with the fast rise of the company and with the issue of bonus, coupled with rights shares. Many shareholders could sell the shares and buy flats and entered in to changed houses and changed life. That explains his later ventures like Reliance Petro and also investor’s confidence in Reliance.

Now the patriarch gone, the two brothers fight and later events we all know.

Reliance can not be the same as it was in the past.

It became so huge that holding on to the shares in the hopes of bonus, rights would be meaning less.

The only best thing is to buy and sell and move in a circle along with the company. The Ambani brothers are very good at this art and you had better play along with them.