The drama over the stock of Reliance Petroleum Ltd (RPL)?s availability in the stock futures segment continued on Monday. After briefly coming out of the ban period on Monday, the RPL stock futures were once again banned for trading as the counter has reached the 95% market-wide position limit on the back of fresh building up of short position in the counter.
On Monday, the open interest (OI) in the RPL came down by 2.37% to 10.23 crore shares in the November series. At present, the total outstanding OI position in the RPL stock stands at 14.92 crore shares. The OI has increased by 238% in December series while in January series it has gone up by 41%.
As a result, RPL November futures closed the day at Rs 203.70, down by Rs 9.65 from its previous close of Rs 213.35. Selling pressure was very much visible in the cash segment too, where the stock closed the day at Rs 204.05, losing Rs 5.55 or 2.65% after touching an intra-day high of Rs 218.50. Trading resumed in the RPL derivative series following the dilution of 4% stake (around 18 crore shares) held by its promoter Reliance Industries Ltd (RIL) on Friday through open market transactions, thereby increasing the free float factor in the market. This has resulted in the outstanding OI position retreating back to the prescribed 80% limit.
Tejvinder Singh, derivative analyst, Arihant Capital Markets, said, ?Since the stock has again been placed under the ban period, retail investors who are stuck up with their long positions at higher levels will have to wait till the beginning of new December derivative series to take a further call.? A derivative analyst with a domestic brokerage firm who did not wish to be named said, high amount of speculative interest has gained an upper hand in the counter. Some traders and operators have aggressively created short positions so that retail investors who are stuck up at higher levels with their long positions are forced to square up their positions, once their stop loss of Rs 190-Rs 195 is triggered.
