- Alok Industries stock fell over 3%, closing at ₹20.68 after recent gains.
- Reliance Industries owns a 40.01% stake in the textile company.
- Experts link the fall to profit booking and global trade shifts.
Alok Industries, a major player in India’s textile sector partially owned by Reliance Industries, saw a notable decline in share price, closing at ₹20.68. This drop followed a short-lived rally earlier in the week that saw the stock jump by nearly 18%.
The broader textile sector has been influenced by international trade policies, particularly a 35% tariff on Bangladeshi textile imports imposed by the U.S. administration.
Alok Industries Stumbles Below ₹21 Despite Reliance Support Amid Global Trade Jitters
Alok Industries’ 52-week performance highlights significant volatility, with a high of ₹29.77 and a low of ₹13.90. The company’s market capitalization stands at over ₹10,000 crore, but its year-to-date loss of around 3% and a 24% decline over the past year have raised questions about its mid-term trajectory.
Reliance Industries Ltd (RIL) acquired a 40.01% stake in Alok Industries during a distressed asset resolution process under the Insolvency and Bankruptcy Code in 2020. This strategic acquisition was aimed at reviving the company’s fortunes in the textile sector. JM Financial Asset Reconstruction Company also holds a 34.99% share.
The textile sector in India is facing dynamic changes, particularly due to shifting global trade policies. The tariff on Bangladesh imports has disrupted traditional supply chains, and while it may open opportunities for Indian exporters, companies like Alok Industries are still adapting to changing demand dynamics.
Brokerage firms such as Religare Broking have advised investors to consider exiting the stock near ₹25 following the recent spike. Although the company shows signs of a technical uptrend, concerns over sustained profitability and macroeconomic pressures remain high on analysts’ radar.
While Alok Industries benefits from strong backing by Reliance Industries, its future performance will heavily depend on how effectively it navigates international trade shifts and domestic market pressures.
“In investing, what is comfortable is rarely profitable.” – Robert Arnott
This quote reflects Alok Industries’ volatile but potentially opportunistic position in the market.
