Morgan Stanley has downgraded Reliance Industries to underweight from equalweight, saying it expects the

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energy major's gross refining margins, exploration and production volumes to fall.

The bank cut its price target for the company to Rs 650 from Rs 921.

"We highlight that two of three Reliance's core divisions -- refining and petrochemicals -- face near-term headwinds," it said in a note.

"We are downgrading our industry view (on oil and gas) to cautious from attractive," it said.

Morgan Stanley also downgraded oil marketing companies Hindustan Petroleum Corp, Bharat Petroleum Corp and Essar Oil to 'underweight' from 'equalweight'.