SCARS Stocks — The Market, Simply

Analyze Like a Pro

Reading a Real Stock.

All data below is simulated for RELIANCE.NS — India's most-watched stock. Every field is explained so you know exactly what you're looking at.

NSEBSE: 500325

RELIANCE

Reliance Industries Limited

₹2,868.50

▲ +48.05 +1.70%

Simulated · NSE · May 30 2026 · 15:29 IST

Open

₹2,831

Prev Close

₹2,820

Day High

₹2,895

Day Low

₹2,810

Volume

76.4L

Mkt Cap

₹19.4L Cr

52W High

₹3,217

52W Low

₹2,220

The Overview is your stock's report card at a glance — price levels, volume, valuation, and delivery data. Before going deeper, a smart investor reads this page first.

Price & Volume

Open

₹2,831.00

Price at market open (9:15 AM). Gaps from previous close signal overnight sentiment shifts.

Previous Close

₹2,820.45

Yesterday's closing price. Compare with today's open to spot gaps.

Day High

₹2,895.00

Highest trade price today. Resistance level — sellers showed up here.

Day Low

₹2,810.20

Lowest trade price today. Support level — buyers stepped in here.

VWAP

₹2,843.60

Volume Weighted Average Price. Institutional benchmark — price above VWAP = bullish intraday sentiment.

Volume

76,42,180

Shares traded today. High volume confirms price moves. Low volume = unreliable breakout.

20D Avg Volume

1.24 Cr

20-day average daily volume. Today's volume vs this = is today unusual?

20D Avg Delivery%

42.8%

% of traded shares taken for actual delivery (not intraday). Higher = genuine investment interest, not just trading noise.

Price Limits & History

UC Limit (Circuit)

₹3,102.50

Upper Circuit — trading halts if price hits this. Prevents panic buying. Set at 10% above previous close.

LC Limit (Circuit)

₹2,538.40

Lower Circuit — trading halts if price falls here. Protects against panic selling cascades.

52 Week High

₹3,217.00

Highest price in the past year. Resistance zone — many sellers hold here. Breaking above = very bullish.

52 Week Low

₹2,220.30

Lowest price in past year. Strong support zone — buyers historically showed conviction here.

All Time High

₹3,217.00

Highest price ever traded. Breaking ATH = powerful signal — no sellers from the past above this price.

All Time Low

₹49.65

Lowest price ever traded (adjusted for splits/bonuses). Puts the entire journey in perspective.

Face Value

₹10

Original par value of one share. Dividends are often expressed as % of face value. ₹10 face value paying 100% dividend = ₹10/share.

Beta

0.92

Volatility vs market. Beta 1 = moves with Nifty. Beta 0.92 = slightly less volatile than index. Good for moderate risk takers.

Valuation Metrics

Market Cap

₹19,24,580 Cr

Total market value = Price × Shares outstanding. India's largest company by market cap.

TTM P/E Ratio

28.83×

Price ÷ EPS. You pay ₹28.83 for every ₹1 of annual profit. Compare: Sector P/E = 24.6×. Slightly premium valued.

TTM EPS

₹98.20

Earnings Per Share — profit attributable to each share over trailing 12 months. Rising EPS = company growing profitably.

P/B Ratio

2.49×

Price ÷ Book Value per share. You pay ₹2.49 for every ₹1 of net assets. Below 1 = possibly undervalued.

Book Value/Share

₹1,142.50

Net assets per share (Assets − Liabilities ÷ Shares). Minimum theoretical value if company liquidated today.

Sector P/E

24.60×

Average P/E for all companies in the same sector. Compare stock P/E to this to judge relative valuation.

Dividend Yield

0.36%

Annual dividend ÷ current price. Reliance is a growth stock — low yield but strong capital appreciation historically.

Value (Lacs)

₹92,343 L

Total rupee value of all shares traded today. High value = highly liquid stock, easy to buy or sell anytime.

Step 1 — Anatomy of a Single Candle

Every candlestick covers one time period — one day on a daily chart, one hour on an hourly chart, or even 1 minute. In that period, exactly four prices are recorded. The candle is built from those four prices and nothing else.

GREEN = BULLISH

Close is ABOVE Open. Buyers won — price rose during this period. The bigger the green body, the stronger the buying pressure.

RED = BEARISH

Close is BELOW Open. Sellers won — price fell during this period. A long red body = strong selling conviction.

UPPER SHADOW (wick)

Sellers rejected higher prices. Price went up to the HIGH but was pushed back down before the session closed.

LOWER SHADOW (wick)

Buyers defended lower prices. Price fell to the LOW but buyers stepped in and pushed it back up before close.

Step 2 — Individual Candle Types

A single candle can already tell you a lot about the battle between buyers and sellers. These patterns are the building blocks — learn to recognise them instantly.

Bullish Momentum

Bullish Marubozu

No upper or lower wick. Price opened at the LOW, closed at the HIGH — buyers dominated every single moment of the session. There was no hesitation, no pullback.

Signal: Extremely strong buying. What to do: In an uptrend, this confirms continuation. Look for entry on the next candle's open or on a minor pullback. Target: Next resistance level. Stop: Below the Marubozu's low.

Bearish Momentum

Bearish Marubozu

No wicks at all. Price opened at the HIGH, closed at the LOW — complete seller domination. Every attempt to recover was crushed before the close.

Signal: Extreme selling pressure. What to do: In a downtrend, confirms continuation. Avoid buying until at least 2–3 green candles appear. Risk: Shorting after this can be profitable but risky (gap up the next day is possible).

Indecision

Long-Legged Doji

Open and Close are almost equal (tiny body). Long wicks above and below show that price swung wildly in both directions but ended exactly where it started. Perfect battle, no winner.

Signal: Market indecision — trend may be about to reverse. What to do: Wait for the NEXT candle to decide direction. If after an uptrend → potential reversal down. If after a downtrend → potential reversal up. Never trade the Doji itself.

Bearish Reversal

Gravestone Doji

Opens and closes near the LOW with a very long upper wick. Buyers pushed price way up, but sellers completely demolished the rally and pushed it back to the opening level. Buyers failed catastrophically.

Signal: Strong rejection of higher prices. Bearish reversal when seen at the top of an uptrend. What to do: Exit long positions, consider entering short on the next red candle. Stop: Above the long upper wick.

Bullish Reversal

Dragonfly Doji

Opens and closes near the HIGH with a very long lower wick. Sellers pushed price way down, but buyers completely recovered the loss and closed near the high. Sellers failed completely — buyers are in control.

Signal: Strong support at the lows. Bullish reversal when seen at the bottom of a downtrend. What to do: Buy on the next green candle's open. Stop: Below the long lower wick.

Bullish Reversal

Hammer

Small body at the TOP, lower wick at least 2× the body (often much longer). Sellers pushed the price deep down during the session, but buyers fought back powerfully and closed near the session high. The long lower wick is the "hammer" that found the floor.

Must have: Appears at bottom of a downtrend. Confirm: Next candle must be green and close above hammer's body. Enter: Above the hammer's high. Stop: Below the hammer's low. Target: Previous resistance zone.

Bearish Reversal

Hanging Man

IDENTICAL shape to the Hammer — but appears at the TOP of an uptrend. The same long lower wick now signals that sellers are starting to show up and take profits. The bulls rescued price this time, but for how much longer?

Context is everything: Same shape as Hammer, opposite meaning. Confirm: Next candle must be red (if it's green, the pattern fails — ignore it). Exit: Close long positions. Short: Below the Hanging Man's low.

Bearish Reversal

Shooting Star

Small body at the BOTTOM, very long upper wick (at least 2× the body). Buyers tried to rally the stock to great heights, but sellers crushed the move and pushed price back down to near the open. The bulls "shot up and fell."

Must appear: At the top of an uptrend. Confirm: Next candle is red. Exit longs: On the next session. Short entry: Below the Shooting Star's low. Stop: Above the upper wick.

Bullish Reversal

Inverted Hammer

Same shape as Shooting Star — but appears at the BOTTOM of a downtrend. Buyers tried to rally and failed this session, but the fact that buyers showed up at all — at this price level — signals potential reversal. Watch for follow-through.

Weaker signal than regular Hammer. Must confirm: Strong green candle next session. Buy: Above the Inverted Hammer's high only after confirmation. Volume on the confirmation candle should be high.

Minor Indecision

Spinning Top

Small body with roughly equal upper and lower wicks. Neither buyers nor sellers could gain a decisive advantage. Less extreme than a Doji but sends the same message — the market is pausing, undecided, waiting for a catalyst.

Context matters: After a long trend, a spinning top signals potential exhaustion. After consolidation, it's just noise. Don't trade it alone. Wait for the next candle. High volume spinning top = more significant indecision.

Step 3 — Two-Candle Reversal Patterns

These patterns use two consecutive candles together to make a stronger case for a reversal. The second candle either confirms or cancels the first candle's story. Two-candle patterns are more reliable than single-candle signals.

Strong Bullish Reversal

Bullish Engulfing

A smaller red candle is completely swallowed (engulfed) by a larger green candle the very next day. The green body must open below the red body's close and close above the red body's open. Buyers made a powerful statement.

Reliability: High — especially after a multi-day downtrend. Volume: Second (green) candle must have higher volume than the first. Enter: On the close of the green candle or next session's open. Stop: Below the green candle's low.

Strong Bearish Reversal

Bearish Engulfing

A smaller green candle is completely engulfed by a larger red candle. The red body opens above the green body's close and closes below the green body's open. Sellers arrived in force and overwhelmed the previous day's buyers entirely.

Reliability: High after multi-day uptrend. Volume: Red candle must be on higher volume. Exit longs on the close of the red candle. Short entry: On the next session's open. Stop: Above the red candle's high.

Bullish Reversal

Bullish Harami

"Harami" means pregnant in Japanese. A large red candle contains a small green candle entirely within its body. The sellers lost momentum — the second day barely moved. Indecision after a downtrend = potential reversal.

Weaker than Engulfing. Confirm: Need a third green candle closing above the small body. Volume: Second candle must have declining volume (selling is drying up). Target: 50% retracement of the large red candle.

Bearish Reversal

Bearish Harami

A large green candle followed by a small red candle contained entirely within the green candle's body. Buyers ran out of steam. The small red candle says "the bull is tired." After a sustained uptrend, this warns of a reversal.

Confirm: Third candle must be red, closing below the small red candle's body. Exit longs: On the confirmation candle. Note: Stronger signal if the small candle is a Doji (Bearish Harami Cross).

Bullish Reversal

Piercing Line

After a red candle, the next day opens BELOW the red candle's low (a gap down — looks bad) but then buyers push it up aggressively, closing above the MIDPOINT of the previous red candle's body. The "pierce" shows buyers regained more than half the ground.

Key rule: Green candle MUST close above 50% of the red candle's body. If it closes below 50%, it's just a failed reversal. Stronger if on higher volume. Stop: Below the green candle's low.

Bearish Reversal

Dark Cloud Cover

Opposite of Piercing Line. After a green candle, next day gaps up (exciting!) but sellers overwhelm buyers and close below the MIDPOINT of the previous green candle. The "dark cloud" has covered the bull's sunshine.

Key rule: Red candle must close below 50% of the green candle's body. Exit longs on the red candle's close. Confirmation: Another red candle next session seals the reversal. Stop: Above the red candle's high.

Step 4 — Three-Candle Patterns

Three-candle patterns offer the highest reliability of all candlestick signals because they require three sessions of consistent price action to confirm. They take more time to form, but they're worth waiting for.

Strong Bullish Reversal

Morning Star

Candle 1: Large red — downtrend continues. Candle 2: Small body (Doji or Spinning Top) that gaps down — sellers still in control but losing momentum. Candle 3: Large green that closes above the MIDPOINT of Candle 1 — buyers have taken over completely.

Most reliable 3-candle pattern. The gap (even small) between C1 and C2 is important. Enter: On the close of C3. Stop: Below the low of C2. Target: Measure from C3 close, project the height of the entire 3-candle formation upward.

Strong Bearish Reversal

Evening Star

Candle 1: Large green — uptrend continuing. Candle 2: Small body that gaps up — buyers still pushing but weakening. Candle 3: Large red that closes below the MIDPOINT of Candle 1 — sellers have seized control. The "evening" signals the end of the bull run.

Mirror image of Morning Star. Exit all long positions on the close of C3. Short entry: Below C3's close. Stop: Above the high of C2 (the star). Stronger when C2 is a Doji (Evening Doji Star).

Bullish Continuation

Three White Soldiers

Three consecutive large green candles, each opening within the previous candle's body and closing progressively higher. No significant upper wicks. Consistent, methodical buying — this isn't a panic rally but a measured, sustained advance by confident buyers.

Caution: If you see this after a long uptrend, it can also signal exhaustion (everyone's already bought). Best as a reversal signal after a prolonged downtrend. Upper wicks on any of the three candles = weakening signal. Avoid chasing late.

Bearish Continuation

Three Black Crows

Three consecutive large red candles, each opening within the previous candle's body and closing progressively lower. Consistent, heavy selling — not panic but organised distribution by large players unloading positions systematically.

High reliability after an uptrend (reversal) or in a downtrend (continuation). Exit all longs immediately when this appears at market highs. Short entry: Below the third candle's close. Stop: Above the high of the first candle.

Step 5 — Support, Resistance & Moving Averages

Candlestick patterns show you WHAT is happening. These concepts show you WHERE it matters. Combine both to find high-probability trades.

Support

A price level where buyers historically show up and stop the price from falling further. Think of it as the floor. Every time price touches this zone, buyers see "value" and start buying. The more times price bounces off a level, the stronger the support.

Example: Reliance has bounced off ₹2,700 three times in the last 6 months. That level is strong support. Rule: Buy near support, place stop below support. If price breaks support convincingly → it becomes resistance.

Resistance

A price level where sellers consistently appear and prevent the price from going higher. Think of it as the ceiling. As price approaches this zone, traders who bought at lower prices start selling to lock in profit — creating selling pressure that caps the advance.

Example: Reliance has failed to break ₹3,000 three times. That's strong resistance. Rule: Sell/short near resistance, stop above it. If price breaks resistance on high volume → it becomes support (role reversal).

Moving Averages

The average closing price over the last N days, plotted as a line on the chart. It smooths out noise. The 20-day MA shows short-term trend. The 50-day MA shows medium-term trend. The 200-day MA shows long-term trend. Price above all three MAs = strongly bullish.

Golden Cross: 50MA crosses above 200MA → major bullish signal.
Death Cross: 50MA crosses below 200MA → major bearish signal.

Example: Reliance at ₹2,868 is above its 20MA (₹2,810), 50MA (₹2,760), and 200MA (₹2,640). This is a strong bullish structure — "price above all MAs." Only look for buy signals, not sells, in this environment.

Volume — The Truth Teller

Volume is the number of shares traded. It validates price moves. A price breakout on HIGH volume = real move, big players involved. A breakout on LOW volume = suspect — likely to reverse. Rising price + rising volume = healthy uptrend. Rising price + falling volume = weakening uptrend (distribution phase).

Volume spike at a key support/resistance = the level has been tested with conviction.

Rule of thumb: Never enter a breakout trade unless volume is at least 1.5× the 20-day average volume. If Reliance's average daily volume is 1.2Cr shares, a valid breakout should see 1.8Cr+ shares traded on the breakout day.

Practice Chart — Apply What You Learned

Use this simulated Reliance chart to spot patterns. Can you find the Hammer? The Engulfing? The Three White Soldiers sequence?

RELIANCE · NSE · May 2026 · Daily

Green (Bullish) Candle

Close price is higher than Open. Buyers won the day. Body size shows how strong the move was.

Red (Bearish) Candle

Close is lower than Open. Sellers dominated. A long red body after an uptrend is a warning sign.

Wicks / Shadows

Thin lines above/below the body. Upper wick = sellers pushed back. Long lower wick = buyers defended that level aggressively.

Part 1 — What Is an Option?

An option is a contract that gives you the RIGHT (but NOT the obligation) to buy or sell a stock at a specific price before a specific date. You pay a premium to buy this right. The seller of the option takes the obligation. Think of it like insurance — you pay a premium for protection against a specific outcome.

CALL OPTION — The Right to BUY

You buy a Call option when you believe the stock will GO UP. A Call gives you the right to buy 250 shares at a fixed price (the Strike), no matter how high the stock actually goes. Your maximum loss is limited to the premium you paid. Your profit is unlimited.

Step-by-step example:
Reliance is at ₹2,868 today.
You buy a 2900 CALL expiring June 26.
Premium paid: ₹21.80 × 250 shares = ₹5,450 (your max loss).

Scenario A — You're right: Reliance rises to ₹3,050 by expiry.
Intrinsic value: 3,050 − 2,900 = ₹150
Profit: (150 − 21.80) × 250 = ₹32,050 on ₹5,450 invested!

Scenario B — You're wrong: Reliance stays at ₹2,850.
The call expires worthless. Loss = ₹5,450 (the premium).

Break-even point: 2,900 + 21.80 = ₹2,921.80

PUT OPTION — The Right to SELL

You buy a Put option when you believe the stock will GO DOWN (or to protect stock you already own). A Put gives you the right to SELL 250 shares at a fixed Strike price, no matter how low the stock falls. Maximum loss = premium paid. Profit grows as stock falls.

Step-by-step example:
Reliance is at ₹2,868 today.
You buy a 2800 PUT expiring June 26.
Premium paid: ₹44.20 × 250 = ₹11,050 (your max loss).

Scenario A — You're right: Reliance falls to ₹2,600.
Intrinsic value: 2,800 − 2,600 = ₹200
Profit: (200 − 44.20) × 250 = ₹38,950!

Scenario B — You're wrong: Reliance rises to ₹3,000.
The put expires worthless. Loss = ₹11,050.

Break-even point: 2,800 − 44.20 = ₹2,755.80

Part 2 — Moneyness (ITM / ATM / OTM)

Moneyness tells you the relationship between the Strike Price and the current stock price. It's the single most important concept when selecting which option to buy or sell.

Deep ITM Call

2700

Has ₹168.50 intrinsic value. Moves almost like owning the stock (Delta ≈ 0.90). Expensive but reliable.

ITM Call

2750

Has ₹118 intrinsic value. Good balance of cost and leverage. Delta ≈ 0.70.

★ ATM (CMP ≈ 2868)

2850

Most liquid, highest time value. Most sensitive to moves. Theta burns fastest here. Delta ≈ 0.50.

OTM Call

2900

No intrinsic value — pure time value. Cheap but needs a big move to profit. Delta ≈ 0.35.

Deep OTM Call

3000

Lottery ticket. Costs ₹5.20 but needs a huge move. Delta ≈ 0.10. Expires worthless 85% of the time.

Option Premium = Intrinsic Value + Time Value

Intrinsic Value — The real, calculable value. For a 2800 Call with stock at 2868, intrinsic value = 2868 − 2800 = ₹68. This cannot go negative. OTM options have zero intrinsic value.

Time Value — The probability premium. The more time remaining, the higher the chance the option moves into profit. With 30 days left, the 2800 Call costs ₹78.60. Intrinsic = ₹68. So Time Value = ₹10.60. This decays to zero by expiry (Theta decay).

2800 CALL — Premium Breakdown

Strike₹2,800

Stock Price (CMP)₹2,868

Intrinsic Value₹68.00

Time Value₹10.60

Total Premium₹78.60

Part 3 — The Greeks (How Options Move)

Options don't move like stocks. Four "Greek" variables determine how an option's price changes. Understanding them is the difference between a disciplined options trader and someone who just gambles on direction.

Delta — Direction Sensitivity

Delta tells you how much the option price moves when the stock moves ₹1. A Delta of 0.50 means the option moves ₹0.50 for every ₹1 the stock moves. ATM options have Delta ≈ 0.50. Deep ITM ≈ 1.0. Far OTM ≈ 0.10. Delta also approximates the probability the option expires in the money.

Example: You hold a 2800 Call with Delta 0.62. Reliance rises ₹50 in a day. Your option gains: 50 × 0.62 = ₹31 per share × 250 = ₹7,750. If Reliance falls ₹50, you lose ₹7,750. Delta changes as the stock moves (see Gamma).

Theta — Time Decay (Your Enemy)

Theta is the daily erosion of an option's time value — the "rent" you pay each day for owning the option. It's always negative for option buyers. Theta accelerates dramatically in the last 2 weeks before expiry (the "expiry week decay curve"). This is why buying OTM options the week of expiry is extremely risky.

Example: You buy the 2900 Call for ₹21.80. Theta = ₹0.80/day. If Reliance stays flat for 5 days, your option loses: 5 × 0.80 = ₹4.00. Now worth only ₹17.80 — even though the stock hasn't moved at all. Theta decay is why "selling options" (not buying) is statistically profitable for most professional traders.

Vega — Volatility Sensitivity

Vega measures how much the option price changes when Implied Volatility (IV) moves by 1%. High IV = expensive options. Low IV = cheap options. Buying options when IV is low and selling when IV is high is the professional approach. IV spikes before earnings, results, and major news events — then "IV crush" happens after the event.

Example: Before Reliance's quarterly results, IV spikes from 17% to 28%. Your option's Vega is 0.85. Premium jumps: 11 × 0.85 = ₹9.35 added to price even if stock doesn't move yet. Post-results, IV collapses back to 16% — option loses that premium instantly. This is why buying options before results is dangerous even if you're right on direction.

Gamma — Delta Acceleration

Gamma measures the rate of change of Delta. High Gamma means Delta changes rapidly as the stock moves — the option picks up speed. ATM options have the highest Gamma. As an option moves deeper ITM, Delta increases (Gamma effect). Gamma is highest near expiry for ATM options — this is when options can move 10× in a single day (and why expiry day trading is extreme risk/reward).

Example: Your 2850 Call has Delta 0.50 and Gamma 0.015. Reliance rises ₹50. New Delta = 0.50 + (50 × 0.015) = 0.75. The next ₹50 move up will gain you 0.75 × 50 = ₹37.50 per share instead of the original ₹25. Gamma is the acceleration pedal — it works in your favour when in-the-money, against you when going out-of-the-money.

Part 4 — Reading Open Interest (OI)

Open Interest is the total number of outstanding (open) contracts that haven't been settled. When combined with price movement, OI tells you whether moves are backed by fresh money or just position unwinding. This is how professionals interpret the option chain.

Long Buildup

Price ↑ + OI ↑

New buyers entering the market. Fresh money flowing in with bullish conviction. Strong signal — the trend has real fuel. Look for call buying and put writing at these levels. This is the strongest bullish scenario.

Short Covering

Price ↑ + OI ↓

Short sellers (bears) are buying back to close their positions, causing price to rise. No new bulls — just trapped shorts covering. Price rises but may not sustain. Often a weaker rally that reverses once shorts are done covering.

Short Buildup

Price ↓ + OI ↑

New sellers entering the market. Fresh money flowing in with bearish conviction. Strong signal — the downtrend has real participation. Look for put buying and call writing. Strongest bearish scenario. Avoid buying into this.

Long Unwinding

Price ↓ + OI ↓

Long positions (buyers) are selling to exit. Price falls but this is exit-driven, not new selling conviction. May indicate the end of a downtrend rather than its beginning. Watch for a floor to form as longs finish exiting.

PCR, Max Pain & What They Mean

PCR (Put-Call Ratio)

0.91

Total Put OI ÷ Total Call OI. Below 0.7 = too many call buyers, market is over-optimistic → potential pullback. Above 1.3 = too many put buyers, market is overly fearful → potential bounce. PCR is a contrarian indicator — extreme readings often signal reversals.

Max Pain

₹2,800

The strike at which option sellers (writers) have collected the most premium — where the maximum number of options would expire worthless. Stock prices tend to gravitate toward Max Pain as expiry approaches. Useful for predicting expiry settlement price within a ₹50–100 range.

Call OI Wall

₹2,900

Strike with the highest Call OI. Option sellers at this strike don't want price to cross here. They'll sell stock/futures to defend this level. It acts as a resistance ceiling. If price breaks this with volume → sellers scramble to cover → explosive move higher.

Put OI Wall

₹2,800

Strike with the highest Put OI. Option sellers at this strike don't want price to fall below here. They'll buy stock/futures to defend it. Acts as a support floor. If price breaks below this with volume → support collapses → sharp fall as stop losses trigger.

Live Example — RELIANCE Option Chain (Simulated)

CALLS — right to BUY

PUTS — right to SELL

ATM — At The Money (closest to CMP ₹2,868)

◀ CALLS (right to BUY)					STRIKE	PUTS (right to SELL) ▶
OI (Lots)	Chg OI	Volume	IV%	LTP ₹	PRICE	LTP ₹	IV%	Volume	Chg OI	OI (Lots)
8.2L	-12K	22K	14.2	168.50	2700	4.80	25.1	14K	+8K	5.8L
12.5L	+24K	45K	15.8	121.40	2750	9.60	22.4	32K	+16K	9.4L
24.8L	+86K	1.2L	17.4	78.60	2800 ★ ATM	44.20	17.8	98K	+72K	22.6L
18.4L	+52K	84K	18.9	42.30	2850	87.50	19.2	56K	-28K	14.8L
14.2L	+35K	62K	20.5	21.80	2900	128.40	20.8	38K	-14K	10.2L
8.6L	+18K	28K	22.1	10.40	2950	178.20	23.1	18K	-8K	6.4L
5.1L	+8K	12K	24.3	5.20	3000	230.10	26.4	8K	-4K	3.8L

How to Read This

Max Pain

₹2,800

Strike where option sellers lose least. Stock often gravitates toward max pain on expiry day. Watch it.

PCR (Put/Call Ratio)

0.91

Total Put OI ÷ Call OI. PCR below 1 = more calls = bullish bias. Above 1.2 = too many puts = possible reversal up.

Call OI Wall

₹2,900

Strike with highest Call OI = strong resistance. Sellers of calls don't want price to cross here. Acts as a ceiling.

Put OI Wall

₹2,800

Strike with highest Put OI = strong support. Sellers of puts don't want price to fall below here. Acts as a floor.

Part 1 — What is a Futures Contract?

A Futures contract is a legally binding agreement to buy or sell a specific quantity of a stock at a predetermined price on a future expiry date. Unlike options, there is NO choice — both the buyer and seller are OBLIGATED to fulfil the contract. Futures trade on the F&O segment of NSE and BSE.

KEY CONTRACT SPECS — RELIANCE FUTURES

Lot Size250 shares

Contract Value₹7,17,125

SPAN Margin (~12%)₹86,055

Exposure Margin (~3%)₹21,514

Total Margin Required~₹1,07,569

To control ₹7.17 lakh of Reliance stock, you only need ₹1.08 lakh in margin. That's 6.65× leverage. A 1% move in Reliance (₹28.68/share) = ₹7,170 profit or loss on your ₹1.08L investment = 6.65% return on margin.

THE DANGER OF LEVERAGE

Futures leverage works both ways. While ₹1L can control ₹7L of stock, a 10% adverse move in the stock = 66.5% loss on your margin. A 15% move = you lose more than your entire margin and owe additional money to your broker.

Example — The brutal math:
You buy 1 lot of Reliance at ₹2,868. Margin = ₹1,07,569.

Next day: Reliance falls 5% to ₹2,724.60.
Loss: (2,868 − 2,724.60) × 250 = ₹35,850
That's 33.3% of your margin in one day.

Margin call: If losses reduce your margin below the minimum maintenance level, your broker will call you to deposit more money immediately. If you can't, they will SQUARE OFF (close) your position at a loss. No excuses accepted.

Part 2 — Mark to Market (MTM) — Daily Settlement

Unlike stocks where your profit/loss is "on paper" until you sell, futures settle every single day. At the end of each trading day, profits are credited to your account and losses are debited in cash. This is called Mark to Market (MTM). You cannot "wait it out" — losses are real and immediate.

MTM Worked Example — You Buy 1 Lot Reliance at ₹2,868 (Lot Size: 250)

Day	Closing Price	Daily P&L	MTM Settled	Cumulative P&L	Account Impact
Day 0 (Entry)	₹2,868	—	—	—	Pay margin: ₹1,07,569
Day 1	₹2,895	+₹6,750	+₹6,750 credited	+₹6,750	Account grows
Day 2	₹2,842	−₹13,250	−₹13,250 debited	−₹6,500	Cash withdrawn
Day 3	₹2,820	−₹5,500	−₹5,500 debited	−₹12,000	Margin call risk
Day 4	₹2,878	+₹14,500	+₹14,500 credited	+₹2,500	Recovery
Day 5 (Exit)	₹2,871 (sold)	−₹1,750	−₹1,750 debited	+₹750 total	Position closed
Total P&L	—	—	—	+₹750	On ₹1.08L margin = 0.70%

Each day's MTM = (Today's Close − Yesterday's Close) × 250. The sum of all daily MTMs = Total P&L at exit. In stocks, you choose WHEN to realise P&L. In futures, the market FORCES settlement every evening.

Part 3 — Basis, Cost of Carry & Rollover

The Futures price is almost always slightly different from the stock (Spot) price. Understanding why helps you make smarter entry decisions and predict where the stock might go.

Basis

Futures Price − Spot Price. Reliance Futures at ₹2,871.50 vs Spot at ₹2,868.50 → Basis = +₹3.00. Positive Basis (Contango) = normal. Market expects prices to be slightly higher in the future. Negative Basis (Backwardation) = unusual. Market expects lower prices — often a bearish signal or high dividend expectation.

Cost of Carry

The theoretical basis based on risk-free interest rate and time to expiry. Formula: Futures = Spot × (1 + r × T). If the 27-day risk-free rate is 6.5%/year, theoretical futures = 2868.50 × (1 + 0.065 × 27/365) = ₹2,886.28. Actual futures at ₹2,871.50 is below theoretical — slightly bearish market expectation on Reliance.

Rollover

As expiry approaches, traders who want to maintain positions must "roll" — close the near-month contract and open the next-month contract. Rollover % = (Next Month OI / Near Month OI). High rollover + price holding = bullish. Low rollover = traders are exiting positions, not rolling — potentially bearish signal going into the next series.

Spread Trading

Buying one month's futures and selling another. If you expect the basis to narrow, sell the far month and buy the near month. Professional strategy that profits from convergence of the two contracts toward each other as expiry approaches. Low risk, low reward — used by large institutions.

Hedging with Futures

If you own 250 shares of Reliance worth ₹7.17L and fear a short-term fall, sell 1 lot of Reliance Futures. Now, if Reliance falls ₹100, your shares lose ₹25,000 but your futures GAIN ₹25,000 — you're perfectly hedged. This is how large investors protect portfolios during uncertainty without selling their shares.

Futures vs Options

Futures = unlimited profit AND unlimited loss. No premium. Options = defined risk (premium) but lower reward ratio. Futures are for disciplined directional bets with stop-losses. Options are for strategies when you want to cap your maximum loss. Most beginners should start with options (defined risk) not futures (unlimited risk).

Live Example — RELIANCE Futures (Simulated)

Near Month ACTIVE

Expiry: Jun 26, 2026

₹2,871.50

▲ +22.60 (+0.79%)

Open₹2,842.00

High₹2,896.40

Low₹2,832.10

Volume (lots)88,420

Open Interest2.84L lots

Lot Size250 shares

Basis (Fut−Spot)+3.00

Next Month

Expiry: Jul 31, 2026

₹2,884.20

▲ +21.40 (+0.75%)

Volume (lots)24,180

Open Interest1.12L lots

Lot Size250 shares

Basis (Fut−Spot)+15.70

Cost of Carry8.4% p.a.

Far Month

Expiry: Aug 28, 2026

₹2,896.80

▲ +20.80 (+0.72%)

Volume (lots)8,420

Open Interest0.38L lots

Lot Size250 shares

Basis (Fut−Spot)+28.30

Cost of Carry8.2% p.a.

Futures Concepts Explained

Basis

Futures Price − Spot Price. Positive = Contango (normal, market expects higher prices). Negative = Backwardation (market expects price to fall — rare, often a warning).

Cost of Carry

Theoretical basis based on risk-free interest rate. Futures price ≈ Spot × (1 + r × T). If actual basis > theoretical, smart money is long.

Rollover

Near end of expiry, traders "roll" positions to next month. High rollover % with rising price = bullish continuation. Falling rollover = traders exiting bets.

Lot Size

Minimum contract unit. Reliance lot = 250 shares. At ₹2,868/share, one lot costs ₹7.17 lakh in exposure. Margin required ≈ 15% = ~₹1 lakh.

Long Buildup

Price rising + Open Interest rising = new buyers entering. Strong bullish signal — fresh money flowing in, not just short covering.

Short Covering

Price rising + OI falling = shorts (sellers) buying back to close their positions. Price rises but no new bulls — often a weaker, shorter-lived rally.

Fundamentals answer the question every investor must ask before buying: Is this company genuinely good, and am I paying a fair price for it? Charts show when to buy. Fundamentals show what to buy. The best investors combine both. Each lesson below teaches one metric from scratch — with a real example so you can use it immediately.

Revenue & Revenue Growth

Total money earned from selling goods/services. Also called Turnover or Sales.

Revenue is the top line — the total money a company collects from customers before any expenses. Revenue growth tells you if the business is expanding. A company growing revenue at 15%+/year is outpacing inflation and gaining market share. If revenue is flat or shrinking, everything downstream (profit, EPS) suffers.

Reliance example:
FY25 Q4 Revenue: ₹2,43,711 Crore. FY24 Q4 Revenue: ₹2,36,400 Crore.
Revenue Growth = (2,43,711 − 2,36,400) / 2,36,400 × 100 = 3.1% QoQ.Annual Revenue FY25 ≈ ₹9,63,000 Crore. Compare this across 5 years to see the trend — Reliance has grown revenue 2.8× in 5 years.

Excellent

15%+ yearly growth

Good

8–15% growth

Average

3–8% growth

Concern

Flat or declining

Trap: High revenue without profit is meaningless (Amazon grew revenue for years while barely profitable — but it was investing for dominance; a small company doing this is dangerous). Always check if revenue growth is converting to profit growth.

EBITDA & EBITDA Margin

Earnings Before Interest, Taxes, Depreciation & Amortisation ÷ Revenue × 100

EBITDA strips out financing decisions (interest), tax strategies, and accounting choices (depreciation) to show the raw operational profitability of the business. It answers: "Before all the financial engineering — how much money does this business actually generate from its core operations?" EBITDA Margin tells you what percentage of every rupee earned becomes operating profit.

Reliance example:
Q4 FY25 Revenue: ₹2,43,711 Cr. EBITDA: ₹44,208 Cr.
EBITDA Margin = 44,208 / 2,43,711 × 100 = 18.1%This means for every ₹100 Reliance earns, ₹18.10 survives after paying operational costs. Reliance's margin has been steadily improving (was 14.2% in FY22) — a strong positive trend.

Struggling

Below 10%

Average

10–18%

Good

18–30%

Exceptional

30%+ (software/pharma)

Trap: EBITDA excludes depreciation and interest — two very real costs. A capital-intensive business (like telecom or manufacturing) with high depreciation can look great on EBITDA but terrible on net profit. Always check net margin too, not just EBITDA margin.

Net Profit & Net Profit Margin

Net Profit ÷ Revenue × 100 — the true "bottom line" after ALL costs

Net Profit is what remains after every single expense — cost of goods, salaries, rent, interest on debt, taxes, depreciation, everything. This is the money that belongs to shareholders. Net Profit Margin shows the company's overall efficiency. It's the "real" profitability metric. A company with high revenue but thin net margins is a volume business that can be wiped out by even minor cost increases.

Reliance example:
Q4 FY25 Revenue: ₹2,43,711 Cr. Net Profit: ₹19,407 Cr.
Net Profit Margin = 19,407 / 2,43,711 × 100 = 7.96%This means after paying every bill, every salary, every tax and interest payment, Reliance keeps ₹7.96 out of every ₹100 earned. For context, IT companies like TCS have ~25% margins — but they have almost no capital costs. Reliance's 8% on ₹9.6L Cr revenue is still enormous in absolute terms.

Thin Margin

Below 5%

Moderate

5–12%

Healthy

12–25%

Excellent

25%+ (software/pharma)

Trap: Compare margin within the same sector. A 5% margin is terrible for a software company but respectable for a commodity refiner. Reliance's 8% is sector-appropriate. The trend matters more than the absolute — improving margin over 3–5 years = excellent management.

EPS — Earnings Per Share & EPS Growth

Net Profit ÷ Total Shares Outstanding = ₹ earned per share per year

EPS is the company's profit allocated to each share. It's the most fundamental measure of how much value the company is creating for each share you hold. Rising EPS = your share is becoming more valuable. EPS growth rate is more important than the absolute EPS number — a company growing EPS at 20%/year will double your money faster than one growing at 5%/year, even if the latter has higher current EPS.

Reliance example (TTM):
Net Profit: ₹66,702 Cr (sum of last 4 quarters). Shares outstanding: 679.2 Cr shares.
EPS = 66,702 / 679.2 = ₹98.20 per shareSo each share of Reliance "earned" ₹98.20 this year. The stock at ₹2,868 trades at 29.2× this earnings. 5-year EPS trend: FY21: ₹57.6 → FY22: ₹76.4 → FY23: ₹85.1 → FY24: ₹90.2 → FY25: ₹98.20. Consistent growth — 11.3% CAGR.

EPS Growth

Below 8%/yr

Average

8–15%/yr

Good

15–25%/yr

Exceptional

25%+/yr sustained

Trap: Companies can inflate EPS by buying back shares (reducing share count). A company with flat profit but falling share count shows rising EPS. Always check if profit itself is growing, not just EPS. Adjusted EPS (excluding one-time gains/losses) is more reliable than reported EPS.

P/E Ratio — Price to Earnings

Current Share Price ÷ Earnings Per Share (TTM)

P/E is the most widely used valuation metric. It tells you how many years of current earnings you're paying for the stock. A P/E of 29 means you're paying 29 years' worth of current earnings upfront. Higher P/E = market expects strong future earnings growth. Lower P/E = market has low growth expectations OR the stock is genuinely cheap. P/E is meaningless in isolation — always compare to the sector, to historical average, and to growth rate (see PEG).

Reliance example:
Stock Price: ₹2,868. TTM EPS: ₹98.20.
P/E = 2,868 / 98.20 = 29.2×Sector average P/E = 24.6×. So Reliance trades at a 18.7% premium to its sector. Is this justified? Yes — Reliance is India's most diversified conglomerate (Jio + Retail + O2C + Green Energy) with a 11.3% EPS CAGR. A premium P/E for a dominant, growing business is rational. Historical context: Reliance 5-year avg P/E = 23.4× — current P/E slightly above historical mean.

Potentially Cheap

Below sector avg

Fair Value

Near sector avg

Premium

10–30% above sector

Expensive

30%+ above sector

Common mistakes: (1) Comparing P/E across sectors — IT's 30× is "fair," cement's 30× might be very expensive. Always compare within sector. (2) Using forward P/E vs TTM P/E interchangeably — forward P/E uses analyst estimates which can be wrong. (3) Low P/E doesn't mean cheap — PSU banks often trade at 5× P/E because earnings are cyclical and unpredictable.

P/B Ratio — Price to Book Value

Current Share Price ÷ Book Value Per Share (Net Assets per Share)

Book Value is the net worth of a company — total assets minus total liabilities. Book Value Per Share = this divided by shares outstanding. P/B tells you how much you're paying relative to the company's accounting net worth. If P/B = 1, you're buying ₹1 of assets for ₹1. Below 1 = potentially buying ₹1 of assets for less than ₹1. Above 3–4 = paying a large premium for intangible value (brand, technology, management).

Reliance example:
Stock Price: ₹2,868. Net Assets: ₹7,76,044 Cr. Shares: 679.2 Cr.
Book Value/Share = 7,76,044 / 679.2 = ₹1,142.50P/B = 2,868 / 1,142.50 = 2.51×You're paying ₹2.51 for every ₹1 of Reliance's net assets. This "premium" reflects Jio's dominant telecom position, the Reliance Retail monopoly-like reach, and the brand value — none of which appear on the balance sheet.

Deep Value

Below 1× (check why)

Undervalued

1–2× for growth co.

Fair

2–4×

Expensive

Above 6× (need high ROE)

Trap: P/B is most useful for asset-heavy businesses (banks, real estate, manufacturing). For asset-light companies (Infosys, HUL), P/B can look astronomically high — but those companies' value is in their brands and software, not physical assets. For banks specifically, P/B below 1 often signals bad loans (NPAs) — not a bargain.

ROE — Return on Equity (with DuPont Analysis)

Net Profit ÷ Shareholders' Equity × 100 — how well management uses your money

ROE answers the fundamental question every shareholder should ask: "For every ₹100 I've invested in this company, how many rupees of profit does management generate?" A consistently high ROE (15%+) means management is excellent at deploying capital. Warren Buffett specifically looks for companies with consistently high ROE across business cycles. The DuPont formula breaks ROE into three drivers to understand WHY it's high or low.

Reliance DuPont Analysis (FY25):
Net Margin = 7.94% × Asset Turnover = 0.48× × Financial Leverage = 2.26×
ROE = 7.94% × 0.48 × 2.26 = 8.62%Reliance's ROE is moderate because its asset turnover is low (it's a capital-intensive business). HUL's ROE of 52% comes from very high margins (18%) and high asset turnover (3.2×) with minimal assets needed. Five-year ROE: Reliance FY21: 6.8% → FY22: 8.2% → FY23: 8.8% → FY24: 8.4% → FY25: 8.62%. Stable improving trend.

Weak

Below 10%

Average

10–15%

Good

15–25%

Exceptional

25%+ sustained

Trap: High ROE driven by HIGH DEBT (not high profit or asset turnover) is dangerous. A company can borrow heavily to boost ROE, but interest payments will eventually crush profits. Always check what's driving ROE with DuPont. If ROE is high but D/E is also very high → be suspicious.

ROCE — Return on Capital Employed

EBIT ÷ (Total Assets − Current Liabilities) × 100 — returns on ALL capital used

While ROE measures returns on shareholders' equity only, ROCE measures returns on ALL capital deployed — equity AND debt combined. This is more complete because it ignores how the business is financed. ROCE must be compared to the company's Weighted Average Cost of Capital (WACC). If ROCE > WACC, the business creates value. If ROCE < WACC, it destroys value — no matter how fast it grows. This is the most important single metric for capital allocation decisions.

Reliance example:
EBIT (FY25): ₹1,22,320 Cr. Total Assets: ₹21,42,000 Cr. Current Liabilities: ₹5,48,000 Cr.
Capital Employed = 21,42,000 − 5,48,000 = ₹15,94,000 CrROCE = 1,22,320 / 15,94,000 × 100 = 7.67%Cost of Capital for Reliance ≈ 8–9%. So ROCE is borderline — barely value-creating. This reflects the massive ongoing investment in Jio 5G, Reliance Retail expansion, and Green Energy. These investments take years to generate returns. Historically Reliance ROCE was 12–15% before the capex surge.

Value Destroying

Below Cost of Capital

Neutral

Near Cost of Capital

Value Creating

3–5% above WACC

Excellent

8%+ above WACC

Trap: Companies in heavy investment phases (like Reliance was in 2018–2023) will show depressed ROCE temporarily. This can be a BUYING opportunity if you believe the investments will pay off. Always check the ROCE trend over 10 years, not just current ROCE.

Debt / Equity Ratio

Total Debt (Long-term + Short-term) ÷ Total Shareholders' Equity

This tells you how much borrowed money the company uses relative to the owners' money. Debt amplifies both gains AND losses. A D/E of 2.0 means the company borrowed ₹2 for every ₹1 of equity — high leverage. In good times, this amplifies profits. In bad times (falling revenue, rising interest rates), this can become existential. Also check whether debt is reducing year-over-year (deleveraging) or increasing (leveraging up).

Reliance example:
Total Debt: ₹3,55,880 Cr. Total Equity: ₹7,94,420 Cr.
D/E = 3,55,880 / 7,94,420 = 0.45×Reliance was at D/E of 1.2× in FY20 (during the Jio investment phase) and has deleveraged significantly. 0.45× is comfortable. Net D/E = (Debt − Cash) / Equity. Reliance has ₹1,89,000 Cr in cash equivalents, so Net Debt = 3,55,880 − 1,89,000 = 1,66,880 Cr. Net D/E = 0.21× — very healthy.

Conservative

Below 0.5×

Healthy

0.5–1.0×

Moderate

1.0–2.0×

High Risk

Above 2.0×

Trap: Acceptable D/E varies widely by industry. Utilities and infrastructure companies regularly have D/E of 3–5× (stable cash flows justify it). Banks technically have infinite D/E (they're in the business of borrowing money). Zero debt is not always ideal — some leverage can improve ROE if the business earns more than its cost of debt.

Current Ratio & Quick Ratio

Current Assets ÷ Current Liabilities | Quick = (Current Assets − Inventory) ÷ Current Liabilities

Current Ratio measures a company's ability to pay its short-term obligations (due within 1 year) using its short-term assets. Above 1.5 = comfortable. Below 1 = the company can't pay its current bills without borrowing more — a cash crunch risk. The Quick Ratio is stricter — it excludes inventory (which may take time to sell) and only counts cash, receivables, and liquid assets. Quick Ratio below 0.8 is a warning signal for most businesses.

Reliance example:
Current Assets: ₹2,24,500 Cr. Current Liabilities: ₹2,00,400 Cr. Inventory: ₹24,800 Cr.
Current Ratio = 2,24,500 / 2,00,400 = 1.12× (adequate)Quick Ratio = (2,24,500 − 24,800) / 2,00,400 = 0.99× (borderline)Reliance's large inventory (crude oil, petrochemical feedstock) depresses its Quick Ratio. For a commodity business this is normal — inventory is readily sellable. For a retailer with fashion inventory, this would be more concerning.

Danger

Below 1.0×

Adequate

1.0–1.5×

Healthy

1.5–2.5×

Too much idle cash

Above 3.0×

Trap: Very high current ratio (above 3×) isn't always good — it may mean the company is sitting on too much idle cash instead of deploying it for growth. Industry context matters: Retail and fast-moving consumer businesses can operate comfortably with Current Ratio near 1.0 due to fast inventory turnover.

Free Cash Flow (FCF)

Cash from Operations − Capital Expenditure (Capex) = actual cash the business generates

FCF is the most honest financial metric — the hardest to manipulate. It shows the actual cash a company generates after maintaining and growing its business. This cash can be used to pay dividends, buy back shares, reduce debt, or make acquisitions. A company can show profit on paper while burning cash (via accounting tricks). FCF doesn't lie. "Revenue is vanity, profit is sanity, cash is king" — FCF is the king metric that Warren Buffett calls "owner earnings."

Reliance example:
FY25 Cash from Operations (CFO): ₹1,08,340 Cr. FY25 Capex: ₹78,240 Cr.
FCF = 1,08,340 − 78,240 = ₹30,100 Cr (FCF Positive for second year running)This is a massive improvement from FY22 (FCF was NEGATIVE ₹10,060 Cr) when Reliance was investing heavily in Jio towers and Reliance Retail. FCF turning positive signals the heavy investment phase is over — now Reliance generates surplus cash. This is why the stock has re-rated higher in FY24–25.

Cash Burning

Negative FCF (unless investment phase)

Breakeven

FCF near zero

Healthy

FCF Yield 2–5% of Mkt Cap

Excellent

FCF Yield 5%+ of Mkt Cap

Trap: Negative FCF is sometimes acceptable — for fast-growing companies investing heavily in infrastructure (Jio in 2018–2022) or technology startups building their product. The question is: will those investments eventually generate strong FCF? If yes, negative FCF today is an investment. If the business model is fundamentally cash-burning (like many food delivery apps), it's a red flag.

Interest Coverage Ratio

EBIT (Operating Profit) ÷ Annual Interest Expense = how safely can it pay debt?

This ratio tells you how many times the company can pay its annual interest bill from its operating profit. It's the safety cushion for debt. A company that earns exactly enough to cover its interest is on a knife's edge — any revenue dip puts it in default. High interest coverage = comfortable debt burden. It also tells you the quality of profit — a company with high profit but low interest coverage has most of that profit committed to banks, leaving little for shareholders.

Reliance example:
FY25 EBIT: ₹1,22,320 Cr. Annual Interest Expense: ₹25,380 Cr.
Interest Coverage = 1,22,320 / 25,380 = 4.82×Reliance can pay its annual interest 4.82 times over from operating profit. This is comfortable. Even if revenue fell 60%, Reliance could still cover its interest. Compare: Adani Group companies historically had ICR of 1.5–2.0× — dangerously thin margins. High-debt infrastructure companies with ICR below 2× are always at risk in economic downturns.

Danger Zone

Below 1.5× (debt trap)

Caution

1.5–3×

Comfortable

3–6×

Very Safe

Above 6×

Trap: For zero-debt companies, ICR doesn't apply (they have no interest). For cyclical businesses (steel, cement), ICR can swing wildly between boom years (10×+) and bust years (1×). Always check the worst-year ICR, not just current. A company that can't survive its sector's cyclical downturn shouldn't be in your long-term portfolio.

Dividend Yield & Payout Ratio

Annual Dividend Per Share ÷ Current Share Price × 100 | Payout = Dividend ÷ EPS × 100

Dividend Yield is the annual "rent" you earn on your stock investment — like a Fixed Deposit interest rate, but from a company. Payout Ratio shows what percentage of profits the company pays as dividend. Low payout = company retains earnings to invest for growth (often better for stock price appreciation). High payout = mature company returning profits to shareholders (suitable for income investors). The ideal depends on your goal — income or growth.

Reliance example:
Annual Dividend: ₹10/share. Stock Price: ₹2,868. EPS: ₹98.20.
Dividend Yield = 10 / 2,868 × 100 = 0.35%Payout Ratio = 10 / 98.20 × 100 = 10.2%Reliance pays only 10.2% of earnings as dividends — retaining 89.8% for growth investments (Jio 5G, Reliance Retail expansion, Green Energy). Compare to a mature company like Coal India: Dividend Yield ~7%, Payout ~80%. Both approaches are valid — different investor goals.

No Income

0–1% yield (growth stocks)

Low Income

1–3% yield

Income Stock

3–6% yield

High Yield

6%+ (check sustainability)

Trap: A very high dividend yield (8%+) can be a "dividend trap." If a stock's price has crashed because of bad business fundamentals, the yield looks attractive — but the company may cut the dividend next year, making you lose on both counts. Always check if the payout ratio is sustainable (below 80%) and if the underlying business generates enough FCF to afford the dividend.

PEG Ratio — Price/Earnings to Growth

P/E Ratio ÷ EPS Growth Rate (%) — the valuation metric that accounts for growth

P/E doesn't tell the full story because it ignores growth rate. A stock at P/E 40 might be cheaper than one at P/E 15 if it's growing earnings 5× faster. PEG fixes this by dividing P/E by the earnings growth rate. Peter Lynch (legendary investor) popularised PEG: PEG below 1 = potentially undervalued. PEG of 1 = fair value. Above 2 = potentially overvalued. This is a far more complete picture than P/E alone.

Reliance example:
P/E: 29.2×. 5-year EPS CAGR: 11.3%.
PEG = 29.2 / 11.3 = 2.58 (borderline expensive)Comparison: Infosys at P/E 25× with 8% EPS growth → PEG = 25/8 = 3.1× (more expensive). A fast-growing FMCG brand at P/E 60× with 30% EPS growth → PEG = 60/30 = 2.0× (fair for that growth). Peter Lynch's ideal: Find stocks with PEG below 1 — companies growing fast but still trading at a modest P/E. These are the multi-baggers.

Undervalued

Below 1.0 PEG

Fair Value

1.0–1.5 PEG

Slightly Expensive

1.5–2.5 PEG

Overvalued

Above 2.5 PEG

Trap: PEG uses historical EPS growth — which may not continue. A company that grew 30%/year for 5 years but is now maturing will have a low PEG that looks attractive, but future growth might be only 8%. Always use a conservative, forward-looking growth estimate. Also, PEG works poorly for cyclical businesses where earnings swing wildly year to year.

Financial statements are a company's formal score sheet. Profit & Loss shows income and expenses. Balance Sheet shows assets vs liabilities. Cash Flow shows actual cash movement — the hardest to manipulate. Ratios summarize operational efficiency across years.

Quarter	Jun 24	Sep 24	Dec 24	Mar 25	Jun 25E
Revenue (₹ Cr)	2,36,014	2,35,481	2,42,193	2,43,711	2,48,320
EBITDA	38,248	40,112	42,580	44,208	45,100
EBITDA Margin %	16.2%	17.0%	17.6%	18.1%	18.2%
Depreciation	12,420	12,680	13,100	13,380	13,600
EBIT	25,828	27,432	29,480	30,828	31,500
Interest	5,360	5,280	5,140	5,080	4,920
Other Income	2,840	3,120	3,280	3,560	3,400
Net Profit	15,138	16,563	18,540	19,407	20,100
Net Margin %	6.4%	7.0%	7.7%	7.9%	8.1%
EPS (₹)	22.42	24.52	27.45	28.72	29.75

Figures in ₹ Crores. Jun 25E = Analyst estimates. Revenue and profits show a clear improving trend — a positive signal.

Activity	Mar 22	Mar 23	Mar 24	Mar 25	Mar 26E
Cash from Operations (CFO)	82,390	1,21,450	94,820	1,08,340	98,200
Cash from Investing (CFI)	-92,450	-1,38,620	-85,430	-78,240	-68,500
Cash from Financing (CFF)	11,200	18,420	-8,640	-24,180	-28,400
Net Cash Flow	1,140	1,250	750	5,920	1,300
Free Cash Flow (FCF)	-10,060	-17,170	9,390	30,100	29,700
CFO / Operating Profit %	28%	48%	38%	44%	40%

FCF turned positive in FY24 after years of heavy capex in Jio & Retail. Rising FCF = company generating real cash, not just accounting profit. This is a key quality signal.

Ratio	Mar 22	Mar 23	Mar 24	Mar 25
Debtor Days	24	28	32	35
Inventory Days	48	52	58	62
Days Payable	42	48	55	60
Cash Conversion Cycle	30	32	35	37
Working Capital Days	22	25	28	30
ROCE %	7.8%	8.2%	7.6%	7.4%
Asset Turnover	0.52×	0.54×	0.50×	0.48×

Debtor Days rising = customers taking longer to pay (watch carefully). Cash Conversion Cycle rising = more cash is tied up in operations. Both are mild negatives to monitor in upcoming quarters.

Shareholding pattern shows who owns how much of the company. Changes in FII and DII holding are key signals — institutions doing deep research are either buying or selling. Promoter pledging is a red flag to always check.

Mar 2025 — Latest

Promoters

50.31%

FIIs

22.15%

DIIs

16.42%

Public

11.12%

Historical Shareholding (%)

Holder	Jun 24	Sep 24	Dec 24	Mar 25	Jun 25
Promoters	50.26	50.26	50.26	50.31	50.31
FIIs	22.84	22.62	22.48	22.15	21.98
DIIs	16.08	16.24	16.52	16.42	16.58
Public (Retail)	10.82	10.88	10.74	11.12	11.13
No. of Shareholders	32.4L	33.1L	34.2L	35.6L	36.8L

What to Watch

FII Trend

Slowly Selling

FIIs have reduced from 22.84% to 21.98% over 5 quarters. Could be profit booking after a run-up, or rebalancing. Not alarming yet — but watch if it accelerates below 20%.

DII Trend

Steadily Buying

DIIs (mutual funds, insurance cos) have increased from 16.08% to 16.58%. Domestic institutions are absorbing FII sales. A supportive signal for the stock price.

Retail Trend

Growing Interest

Retail shareholders growing from 32.4L to 36.8L. More individual investors buying — sign of broad trust. Also means more diversified ownership base.

Promoter Pledge

0% Pledged

Promoters have pledged ZERO shares as collateral for loans. This is a strong positive — promoters who pledge shares are risky (forced selling if price drops). Zero pledge = total confidence.

News flow moves stocks. Learn to distinguish between noise and signal. Earnings reports, management guidance, regulatory changes, and sector tailwinds are high-signal. TV channel tips and social media rumours are almost always noise.

Business Today2 hours ago

Reliance Industries Posts Record Q4 FY25 Net Profit of ₹19,407 Crore, Up 28% YoY — Beats All Analyst Estimates

Revenue grew 3.1% sequentially to ₹2,43,711 Cr. Jio added 8.2M subscribers in the quarter while Reliance Retail crossed 18,000 stores. Management guided for 15–18% earnings growth in FY26, citing New Energy ramp-up and Jio 5G monetisation.

Positive — Earnings Beat

Mint5 hours ago

Jio Platforms Adds 8.2 Million Subscribers in May 2026, 5G Adoption Hits 48%

Jio now covers 750 districts with 5G. ARPU (Average Revenue Per User) rose to ₹198.4, the highest ever — a key driver of Jio's profitability improvement.

Positive — Subscriber Growth

Economic Times1 day ago

Reliance Retail Plans 500 New Store Openings in Tier-2 Cities in FY26

The retail arm targets gross revenue of ₹3.5 lakh crore by FY27. JioMart active users crossed 12 crore. Analysts see this as a potential re-rating trigger for the stock.

Watch — Long-Term Positive

CNBC-TV182 days ago

RIL Declares ₹10/Share Final Dividend for FY25 — Record Date June 20

Total dividend outflow: ₹6,780 Cr. Dividend yield at current price: 0.35%. Board also approved a ₹75,000 Cr capex plan for FY26, focused on green hydrogen and 5G network densification.

Positive — Dividend Declared

Hindu BusinessLine3 days ago

Global Crude Oil Prices Drop 4% — Possible Margin Headwind for Reliance O2C Segment

The O2C (Oil-to-Chemicals) segment contributes ~40% of Reliance revenue. Falling crude can compress refining margins if petrochemical prices don't adjust. Analysts trimmed O2C segment estimates by 3%.

Watch — Sector Headwind

Corporate Actions

Dividend₹10/share Final Dividend — FY2025. Record date June 20, 2026. Ex-dividend date June 19, 2026.Jun 19, 2026

AGM47th Annual General Meeting — Venue: Jio World Convention Centre, Mumbai. Results to be presented.Jul 15, 2026

Bonus1:1 Bonus Issue (2020) — 1 free share for every 1 held. Post-bonus shares outstanding: 674.8 Cr.Oct 2020

SplitStock split — Face value reduced from ₹10 to ₹10 (no current split active). Last split was in 2009 at 1:2.Historical

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