Gas production to be key trigger in RIL Q4 results: Choksey

In an interview with CNBC-TV18, Deven Choksey, MD of KR Choksey Shares and Securities spoke about his expectations from the oil and gas major Reliance Industries' quarterly numbers.

He expects the company's net level the profit to be around Rs 5,450 crore. He said that the key trigger to be watched out for would be it's gas volume, gas production. "In the sequential quarters, in last three quarters there has been a the kind of fall in the gas volumes production. In the current month also, it has already dipped to around 50 or little below 50 so. We will have to look at that part to conclude what could be the miss going forward." Below is the verbatim transcript of his interview with Udayan Mukherjee and Mitali Mukherjee of CNBC-TV18. Also watch the accompanying video. Q: What are your estimates going at and what would constitute a miss from Reliance this time? A: The estimates are basically quite inline with what market also believes. We believe that at the net level the profit would be somewhere around Rs 5,450 crore. The prime reason for which we have factored in this particular calculation is also based on the kind of GRM margins, which are expected to be at least USD 3 above the Singapore GRM margins. Probably, it could hover around somewhere USD 10 per bbl kind of a margin. That is one aspect of it. Otherwise, the refining volume could remain quite static at around 16.1 million tonne. So, that is one which we would like to keep. We believe that the key trigger or key issue which one would like to see could be the kind of a gas volume, gas production. We have been seeing in the sequential quarters, in last three quarters the kind of a fall into the gas volumes production. We had estimated our conclusion based on the 52 mmcmd. In the current month we learn that it has already dipped to around 50 or little below 50 so. It is going to be somewhat challenging part as far as going forward the gas business estimations are concerned, going forward. We will have to look at that part to conclude what could be the miss going forward. Q: Have you factored in the shutdown in the Jamnagar facility and to what extent could that erode the earnings somewhat? A: We did factor that part of the shutdown and possibly that is the reason for which they are slightly below the market estimate on the profit side. I don