RIL Q1 net sales up by 41% at Rs 41,579 cr

Reliance Industries has announced its first quarter numbers wherein both topline and bottomline numbers were in line with estimates.

It has posted 13.2% growth in its net profit of Rs 4,110 crore for the quarter ended June 2008 as against Rs 3,630 crore in same period of last year while CNBC-TV18 estimated at Rs 4,142 crore.

Net sales was up by 40.8% at Rs 41,579 crore from Rs 29,524 crore YoY.

Q1FY09

EBITDA: up 7.9% to Rs 6121 cr Vs Rs 5673 cr

EBITDA Margin: 14.7% Vs 19.2% (Q4:16.1%)

Segmental Revenues

Petrochemicals: up 12.5% to Rs 14871 cr Vs Rs 12961 cr

Refining: up 45.9% to Rs 32587 cr Vs Rs 23575 cr

EBIT Margins: 12.3% Vs 15.9% (Q4: 12.3%)

EBIT Petrochemicals: 10.6% Vs 14% (Q4: 10.4%)

EBIT Refining: 9.3% Vs 11.5% (Q4: 9.9%)

Other expenditure includes Forex losses of Rs 280 cr

Refining Segment

GRMs at $ 15.7/bbl, lower than expectations – market expectations at $ 16-17/bbl

Refining throughput up at 8.13mt Vs 8.01 mt

Market expected inventory gain to boost refining segment output.

Inventory gains of $ 1.7/bbl in the books, valued at Rs 424 cr

Differenial with Singapore GRMs have contracted

Petchem Division

Volumes up 4% - market expected fall in volumes due to shutdown

Total inventory at Rs 2600 cr – Rs 2200 cr in petchem inventory

Margins under pressure due higher feedstock prices; Naphtha prices up over 50% YoY

Analyst Meet Feedback 

Management outlook on various segments had a negative bias

Mgmt indicated to wait & watch approach on the current situation and may remain sub-dued for the next few quarters

Don’t want to be in the limelight for the next few quarter – that’s the key takeaway from the meet

Statements cautius on various segment performance

Refining climate indicated to be challenging, no indication on start of Jamnagar refinery – keeps earlier deadline of ahead of 2008 December

Petchem climate remains challenging and cautious – margins will remain under pressure due to higher feedstock prices

E&P capex likely to overshoot target due to cost pressure on E&P; Capex in Q1 at $ 1.7 bn, 80% was in E&P

Oil production likely to get delayed, KG gas production likely to start by September

Mgmt. indicated that the refinery will be commissioned in stages, i.e., CDU-wise and would involve a period of trial production

Mgmt. expressed confidence in its ability to sell gas as per gas utilization and pricing policy.

On the 80IB tax issue, the issue will likely be resolved in courts once it files its first tax returns.

The two refineries would require 10-12mmscmd to start with. The east-west pipeline is ready and currently being tested.

RIL also announced a discovery in D6 in a new channel play, which could gain in significance.

MA development plan has been approved for capex of USD2.5bn

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