Reliance Power shares drop over 5% as probe agency freezes ₹2,033 crore in assets

Reliance Power stock dropped more than five percent after the Enforcement Directorate froze domestic assets worth over two thousand crore rupees in a foreign exchange rule violation case. The seized holdings include bank accounts and company shares in Sasan Power. The probe agency issued the seizure order under Section 37A of the Foreign Exchange Management Act. The company stated it denies the claims and will take legal steps to safeguard its stakeholders.

Investigation Details

Investigators state the case originates from a market regulator inquiry into large financial write-offs involving overseas investments in the British Virgin Islands and the Cayman Islands. The probe follows funds raised abroad through bonds back in two thousand six by a firm that later merged with Reliance Power. Investigators claim those funds served as security for loans given to overseas shell firms managed from India. The agency alleges these loan amounts were routed back through Mauritius entities while remaining parked abroad, and that paperwork was backdated to disguise the transactions as valid business deals.

Market Impact

During the trading session, the stock moved between an intraday peak and a low point on the Bombay Stock Exchange. Market experts note the equity continues to face downward pressure and trades below key moving averages. Analysts point to support levels near eighteen and nineteen rupees, with resistance observed at higher thresholds.

Context

Foreign exchange laws in India strictly regulate how capital flows across borders to prevent illegal movement of money. Enforcement agencies examine complex multi-layered transactions involving offshore tax havens when investigating possible financial rule violations by large corporate groups.