See upside in Reliance Ind, target Rs 1150: Prayesh Jain

Prayesh Jain, AVP - Research at IIFL told CNBC-TV18, "Reliance Industries' numbers were much better than estimates and they were operationally better, so a gap up opening is in the offering. We would still be buyers of the stock considering that even in weak environment Reliance has reported substantial beat to benchmark gross refining margins (GRMs). We expect some improvement in the overall market dynamics for refining.""Reliance is starting its petcoke gasification project by the end of this, the margins to only improve further and the outperformance of the benchmark should improve further. Even on the petchem side, the margins were slightly better than what we were expecting and they are now inching towards 12 percent EBIT margin range. Going ahead with new capacities coming on the off-gas cracker is expected in FY'17. All these things would drive substantial margins accretion to the petchem business as well. So there is strong earnings growth expected from both these businesses in the near term," he said. "However, there is a slight delay in telecom launch and that could something be a slight disappointment to market because that would have given some clarity about the financials but that should not be a bit bothering. Retail is doing well, the exploration and production (E&P) business is not material now anymore with regards to profitability and revenues. So in that sense, the news can be sentiments, but there is a good upside for Reliance from here on.""We have a one year price target of Rs 1,150 on the stock," he added.Disclosure: Reliance Industries has acquired management control of Network18, which owns TV18 Broadcast and moneycontrol.com