Another round of heavy falls in the shares of Anil Ambani’s business empire capped a miserable week for the Indian tycoon that saw him questioned by anti-corruption investigators and beset by mounting debts in his flagship telecommunications group.

Shares in Reliance Communications, the second-biggest carrier by subscribers in India’s telecoms market, fell 6.8 per cent on Friday, helping to pull the benchmark Sensex index into negative territory after a five-day rally.

In a sign that investors’ concerns extend beyond Mr Ambani’s telecoms group into the rest of his Bollywood-to-healthcare conglomerate, shares in Reliance Infrastructure and Reliance Power also fell more than 5 per cent each.

For investors and executives, there are two main questions: whether RCom will find a way out of its debt trap and whether the mobile licensing scandal that has rocked the Indian establishment has more twists in store for Mr Ambani.

The week’s most dramatic moment came on Wednesday when Mr Ambani made a surprise appearance at the headquarters of the anti-corruption agency which is probing allegations that the irregular allocation of second-generation, or 2G, spectrum licences in 2008 cost the exchequer $39bn.

Investigators have questioned executives from several groups and RCom denies any wrongdoing. Wherever the probe leads, however, Mr Ambani has other problems.

RCom is slated for less than $1bn of the conglomerate’s forthcoming $35bn capital expenditure, according to a senior figure familiar with the group’s plans – a clear indication that it is not a priority.

The group would consider raising fresh capital through a sale of all or part of RCom “at the right time”, said a senior figure familiar with the company’s plans.

However, analysts agreed with the senior figure’s assessment that this is not the right time to sell.

Shares that traded at almost Rs800 at the height of India’s bull run two years ago closed at Rs93 after Friday’s heavy selling, which left RCom’s Rs192bn ($4.3bn) market capitalisation at less than two-thirds of what it was when the year began.

Key to a change of fortune would be addressing a net debt position that rose to Rs324bn from Rs189bn 12 months earlier, according to results that led some analysts to cut their price targets for RCom when they were published on Monday.

The senior figure added that, should a big chunk of debt be cleared, “suddenly it goes from being an unattractive company to an attractive company”.

But a mooted $9bn deal to deleverage RCom through a sale of its tower assets collapsed in September, helping to scupper talks on a sale of a 26 per cent stake to Gulf rivals Etisalat.

One sector analyst described RCom’s situation as “worrisome”, but added that a $1.93bn loan from China Development Bank at relatively easy terms meant at least that “there is no immediate threat of any kind of payments crisis”.

Meanwhile, Reliance Infrastructure reacted to a 28 per cent decline in its shares this year with a letter to the intelligence agency last week, seen by the Financial Times. The letter purported to name the stock market operator it claimed was behind a “vicious and systematic” campaign of “market manipulation and rumour-mongering” to pummel infrastructure stocks.

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