Motilal Oswal has come out with its earnings estimates on Reliance Industries (RIL) for September quarter FY13. According to the research firm, the company's Q2FY13 sales are likely to go up by 19.3% at Rs 93700 crore, Year-0n-Year (YoY) basis.
The company's net profit is seen down 2.7% at Rs 5550 crore, QoQ.- We estimate RIL to report strong 2QFY13 GRM at USD9.5/bbl v/s USD6.7/bbl in 1QFY13 helped by higher cracks in auto fuels. However, petchem profits are unlikely to increase due to subdued product spreads.
- We expect average 2QFY13 KG-D6 volume of 29mmscmd v/s 33mmscmd in 1QFY13.
- We expect RIL to report PAT of INR55.5b (v/s INR57b in 2QFY12 and INR44.7b in 1QFY13).
- Key things to watch out for: (a) GRM, (b) Petchem margin, (c) KG-D6 production.
- RIL trades at 12x FY14E adjusted EPS of INR69.7. We maintain Neutral due to concerns on cash utilization, RoE reaching sub-15% and increased share (80%) of cyclical refining and petchem businesses in its earnings.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
