Reliance Infrastructure Ltd Hits Lower Circuit Amid Heavy Selling Pressure

Intraday Price Action and Circuit Breaker Trigger

On the day in question, Reliance Infrastructure opened sharply lower, down 4.78% from the previous close, and continued to slide throughout the session. The stock hit its lower price band of ₹114.94, triggering the maximum permissible daily loss of 5% under the current price band system. This marked the eighth consecutive day of declines, cumulatively eroding 33.64% of the stock’s value over this period.

The total traded volume was substantial at 21.52 lakh shares, with a turnover of ₹24.88 crore, indicating heavy participation on the sell side. Notably, the weighted average price was closer to the day’s low, signalling that most trades occurred near the bottom end of the price range, a classic sign of panic selling and aggressive liquidation by investors.

Technical Weakness and Moving Averages

Reliance Infrastructure’s technical indicators remain deeply bearish. The stock is trading below all key moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — underscoring a sustained downtrend. This technical deterioration contrasts sharply with the broader Power sector, which gained 3.14% on the same day, highlighting the stock’s relative underperformance.

The sector’s positive momentum further emphasises that the selling pressure on Reliance Infrastructure is stock-specific rather than sector-driven, possibly reflecting company-specific concerns or negative sentiment among investors.

Market Capitalisation and Liquidity Considerations

With a market capitalisation of approximately ₹4,957 crore, Reliance Infrastructure is classified as a small-cap stock. Despite its size, liquidity remains adequate for moderate trade sizes, with the stock’s traded value representing about 2% of its 5-day average traded value, sufficient to absorb trades worth ₹0.03 crore without significant price disruption.

However, the erratic trading pattern observed recently — the stock did not trade on three of the last 20 days — suggests intermittent liquidity challenges, which may exacerbate price volatility and contribute to the sharp price falls witnessed.

Investor Sentiment and Delivery Volumes

Investor participation has notably increased in recent sessions. Delivery volumes on 2 February surged by 124.97% compared to the 5-day average, reaching 7,070 shares. This spike in delivery volume amid falling prices suggests that investors are offloading shares rather than short-term traders engaging in intraday speculation.

The rising delivery volumes coupled with the stock’s inability to recover from its lows indicate a lack of buying interest and a predominance of panic selling. This dynamic often leads to unfilled supply, where sellers outnumber buyers significantly, pushing the stock into circuit limits.

Mojo Score and Analyst Ratings

Reliance Infrastructure’s Mojo Score currently stands at a low 31.0, reflecting weak fundamentals and poor market sentiment. The Mojo Grade was downgraded from Strong Sell to Sell on 31 January 2026, signalling a continued negative outlook from the MarketsMOJO analytics team. The Market Cap Grade is rated 3, consistent with its small-cap status and associated risks.

These ratings underscore the caution investors should exercise, as the stock’s deteriorating technical and fundamental profile suggests limited near-term upside and elevated downside risk.

Comparative Performance and Sector Context

While Reliance Infrastructure has been on a downward trajectory, the Power Generation and Distribution sector has demonstrated resilience, gaining 3.14% on the day. The Sensex also advanced by 2.56%, reflecting broader market strength. This divergence highlights that Reliance Infrastructure’s challenges are largely company-specific rather than reflective of sector or market-wide trends.

Investors should consider this context carefully, as the stock’s underperformance relative to its peers may indicate structural or operational issues that require further scrutiny.

Outlook and Investor Considerations

Given the current technical weakness, persistent selling pressure, and negative analyst sentiment, Reliance Infrastructure faces significant headwinds in the near term. The stock’s inability to attract buyers at lower levels and the presence of unfilled supply suggest that further declines cannot be ruled out.

Investors should closely monitor upcoming corporate developments, quarterly results, and sectoral trends before considering fresh exposure. Those holding existing positions may want to reassess risk tolerance and consider protective measures such as stop-loss orders or portfolio diversification.

Meanwhile, the broader Power sector’s positive momentum offers alternative investment avenues with potentially more stable returns, especially given Reliance Infrastructure’s relative underperformance.

Summary

Reliance Infrastructure Ltd’s plunge to its lower circuit limit on 3 February 2026, amid heavy selling and unfilled supply, marks a critical juncture for the stock. The combination of technical breakdown, poor Mojo ratings, and sector underperformance signals caution for investors. While the Power sector remains buoyant, Reliance Infrastructure’s stock-specific challenges continue to weigh heavily on its price action.

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