RIL shares gain despite CAG rap

Reversing the initial losses, shares of Reliance Industries on Thursday settled with a gain of nearly three per cent on the bourses even as the government auditor CAG criticised the company for a gas block contract violation.

The stock had dropped by over 2 per cent earlier in the day on the BSE after CAG criticised Reliance Industries and the Oil Ministry for violation of contract for the showpiece KG-D6 gas block.

But later the stock bounced back and ended 2.62 per cent higher at Rs 853.50 on the BSE and was the main leader behind the market rally.

In a similar fashion, the stock closed at Rs 857.50, up 2.88 per cent on the National Stock Exchange.

"Reliance ended in the positive territory despite the CAG's report. The company's counter was highly volatile today as it slipped lower upon the news and then sharply inched upwards later on," Shanu Goel-Senior Research Analyst-Bonanza Portfolio said.

The Comptroller and Auditor General (CAG) today criticised Reliance Industries and the Oil Ministry for violation of contract for the showpiece KG-D6 gas block and called for revamping current profit sharing arrangement that reduces government revenues.

The final audit report of CAG, which was tabled in Parliament on Thursday, however did not quantify how much the government lost when Reliance hiked capital expenditure at the nation's biggest gas field from $2.4 billion proposed in 2004 to $ 8.8 billion estimate in 2006.

With the surge in the bellwether stock, the BSE benchmark index Sensex also ended 100.54 points higher at 17,165.54.