The share price of Reliance Industries Ltd dropped after the conglomerate's battery unit may face fines for failing to set up a battery cell plant
At 12 pm IST, the company's shares were trading at ₹1,160.10. This was a drop of 3.29 per cent or ₹39.50. The stock's intraday low so far is ₹1,156.
Also Read: Ex-SEBI chief Madhabi Puri Buch, 5 others move Bombay HC against stock market ‘fraud’ FIR
The battery unit called Reliance New Energy Ltd was among other companies like Rajesh Exports and a unit of Ola Electric Mobility Ltd which won a Production Linked Incentive (PLI) bid for battery cell manufacturing in 2022.
However, Reliance New Energy missed the deadline to open the plant, making it liable to pay fines of as much as ₹125 crore, according to a Bloomberg report.
HT cannot independently verify the authenticity of this information.
The report also added that Rajesh Exports may also be liable to pay a similar amount for the exact same reason.
However, Bhavish Aggarwal's Ola had started trial production in March last year and also plans to start commercial production of lithium-ion cells in the April to June quarter, according to the report.
{{/usCountry}}However, Bhavish Aggarwal's Ola had started trial production in March last year and also plans to start commercial production of lithium-ion cells in the April to June quarter, according to the report.
{{/usCountry}}The companies were required to achieve a minimum ‘committed capacity,’ along with local value addition of 25% within two years of the agreement, and 50% within five years, according to the report.
However, Reliance's unit had turned its focus to green hydrogen, a key carbon-free future fuel, the report read.
The PLI scheme meanwhile, was as a move by the government to support its ‘Make in India’ policy and possibly dethrone China's dominance in manufacturing.
Also Read: Urban Indians have to 'work till 75, can't retire': HR professional’s LinkedIn post sparks debate
It was to award manufacturers ₹18,100 crore worth of subsidies to meet the milestones for the project which sought to create a cumulative 30 gigawatt-hour capacity of advanced chemistry cell battery storage.
Though Prime Minister Narendra Modi has sought to boost manufacturing to 25% of India's gross domestic product (GDP), the share has actually slipped to 13% in 2023 from 15% in 2014, according to the report.