Moneycontrol
Last Updated : Jan 19, 2018 08:24 PM IST | Source: Moneycontrol.com

RIL could hit record highs on Monday; 10 takeaways from Q3 results

The stock is just 3 percent short of its record high of Rs 959.50. RIL has already rallied nearly 80 percent in the last one year

Kshitij Anand @kshanand

Oil & gas major Reliance Industries reported results were mostly ahead of analyst expectations on D-Street on Friday, led by beat in petchem, digital business (Jio), and retail. The stock, which is trading near record highs, closed 1.2 percent higher at Rs 931 on the NSE.

Tracking the results, most analysts expect the stock to open higher when trading resumes on Monday and possible rally to a fresh record high in the coming week.

The stock is just 3 percent short of its record high of Rs 959.50. RIL has already rallied nearly 80 percent in the last one year.

Sanjiv Bhasin of IIFL in an interview to CNBC-TV18 said that GRMs at USD 11.6/bbl is largely in line. Overall, the numbers are in-line and ahead of estimates what we calculated.

Commenting on the stock, Bhasin said that if something can take you to 11,000 on the Nifty, I think it will be RIL. The IUC cut has been very poorly received by Bharti Airtel and Idea but will be a big blessing for Jio. Going forward, RIL will not be a laggard and if Nifty hits 11,000, RIL will be at Rs 1000, which could happen in next 3 days or a week, but is definitely on cards.

SP Tulsian of sptulsian.com in an interview to CNBC-Tv18 said that no analyst would have thought that Jio would report PAT in FY18 which we have seen in case of Q3. Having posted an EBITDA of Rs 2,628 crore with a Rs504 crore is a blast for Reliance Jio and will cheer markets going forward.

Commenting on the stock movement, Tulsian said that I will not be surprised to see the share moving into four digits ahead of the Budget or maybe in the coming week.

We have collated top 10 takeaways from RIL Q3 results:

Net Profit

RIL reported a consolidated net profit of Rs9423 crore for the quarter ended December 2017, up 16.2 percent QoQ compared to Rs8109 crore reported in the previous quarter and Rs7533 reported in the year-ago period. On a standalone basis, RIL reported a net profit of Rs8454 crore.

Net Revenues

RIL achieved revenue of Rs109,905 crore (USD 17.2 billion), an increase of 30.5 percent as compared to Rs84,189 crore in the corresponding period of the previous year.

The increase in revenue is primarily on account of volume increase with the start-up of petrochemicals projects and increase in prices in refining and petrochemical businesses.

The increase in consolidated revenues reflects robust growth of 116% in Retail business and continued enhancement in Jio’s wireless operations.

Operating Profit

Operating profit before other income and depreciation increased by 52.0 percent to Rs17,588 crore (USD 2.8 billion) from Rs11,574 crore in the corresponding period of the previous year.

Strong operating performance was driven by growth in petrochemicals, retail and digital services businesses along with firm refining margins.

Cash on Books

Cash and cash equivalents as on 31st December 2017 were at Rs78,617 crore (USD 12.3 billion) compared to Rs77,226 crore as on 31st March 2017. These were in bank deposits, mutual funds, CDs, Government Bonds and other marketable securities.

Capital Expenditure

The capital expenditure for the quarter ended 31st December 2017 was Rs17,336 crore (USD 2.7 billion) including exchange rate difference capitalization.

Capital expenditure was principally on account of Digital Services business, the balance of expenditure for projects in the petrochemicals and refining business at Jamnagar and in Organized Retail business.

Refining

Revenue from the Refining and Marketing segment for the quarter ended December 2017 increased by 23 percent on a YoY basis to Rs75,865 crore (USD 11.9 billion) aided by 24 percent higher Brent oil prices.

The segment EBIT marginally decreased by 0.5 percent on a YoY basis to Rs6,165 crore (USD 1.0 billion).

GRMs

Gross Refining Margins (GRM) for 3Q FY18 stood at USD 11.6/bbl as against USD 10.8/bbl in 3Q FY17. RIL’s GRM outperformed Singapore complex refining margins by USD 4.4/bbl.

Petrochemicals Business

The revenue from the Petrochemicals segment for the quarter ended December 2017 increased by 47.6 percent on a YoY basis to Rs33,726 crore (USD 5.3 billion) due to higher volumes and prices.

Petrochemicals segment EBIT was at a record level of Rs5,753 crore (USD 901 million) supported by strong volume growth, higher margins for Polypropylene and downstream polyester products. The volume growth was led by the world’s largest ROGC coming on-stream along with downstream LDPE, LLDPE and MEG plants.

Reliance Jio

Reliance Jio posted a Q3 profit at Rs 504 crore and EBITDA grew by 82 percent to Rs 2,628 crore QoQ. Jio continues its rapid ramp-up of subscriber base and as of 31st December 2017, there were 160.1 million subscribers on the network.

This makes it India’s largest wireless data subscriber base, with the gap widening from the other operators. With gross additions of 27.8 million during the quarter, Jio continues to have a dominant share of all the new LTE smartphones sold in the country.

Reliance Retail

Revenues from the retail segment for the 3Q FY18 grew by 116.4 percent on a YoY basis to Rs18,798 crore compared to Rs8,688 crore reported in the year-ago period.

PBDIT for 3Q FY18 grew by 82.0 percent on a YoY basis to Rs606 crore from Rs333 crore reported in the year-ago period. Reliance Retail witnessed stellar performance across all consumption baskets during the period.

Disclosure: Reliance Industries Ltd. is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd.
First Published on Jan 19, 2018 07:29 pm
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