Reliance Industries hits over 9-year high; stock up 41% in 2017


Reliance Industries (RIL) hit an over 9-year high of Rs 1,525, up 2% on BSE in early morning trade.

The stock was trading at its highest level since January 17, 2008. Thus far in the calendar year 2017, it outperformed the market by surging 41% as compared to 19% rise in the S&P BSE Sensex.
On Tuesday, July 11, Reliance Jio Infocomm (Jio), RIL’s telecom subsidiary, announced that Jio Prime Members can enjoy unlimited services for three months with Rs 399 plan.

Over and above the Prime exclusive plans, Jio introduces new Every Day More Value (EDMV) plans. These plans provide 20% more value than competitors’ best plans, Jio said in a press release.

Meanwhile, analysts at Sharekhan expect RIL’s gross refining margin (GRM) to remain strong at $10.9/11.7 per barrel in FY2018/FY2019 given the robust global oil demand growth outlook for 2017 at 1.3-1.4mbpd (International Energy Agency estimate).

Moreover, a likely improvement in diesel cracks would help RIL to maintain a premium of $4-5/bbl over the Singapore Complex GRM. Ethylene margin is also expected to remain firm at $600-650/mt, led by healthy demand and likely delay in the commissioning of incremental capacities in CY2018.

“We expect EBITDA/PAT CAGR of 21%/9% over FY2017-FY2019E, driven by the commissioning of the core downstream projects in FY2018. Any positive surprise in terms of better-than-expected financials of the Telecom business would be an important re-rating trigger for RIL going forward,” the brokerage firm said in recent report.

“We estimate standalone PAT at INR79bn, down 3% QoQ. We estimate GRM to correct 3% to USD11.2/bbl despite flattish Singapore benchmark due to correction in oil price. We expect refining EBIT to be flat QoQ while petchem EBIT to improve 8% on firm polymer and polyester spreads and 6% higher output on the back of new capacities,” Edelweiss Securities said in Q1FY18 results review.

RIL is yet to announce date for its April-June (Q1FY18) quarter results. Last year, the company had declared Q1FY17 results on July 15, 2016.

At 10:37 am; RIL was trading 1.3% higher at Rs 1,515 on BSE, as compared to 0.19% gain in S&P BSE Sensex. A combined 1.9 million shares changed hands on the counter on BSE and NSE so far.