RIL slips on muted bottomline growth in Q2 September 2008

The company declared the results after market hours yesterday, 23 October 2008.

Meanwhile, the BSE Sensex was down 236.21 points, or 2.42%, to 9528.23.

On BSE, 1.89 lakh shares were traded in the counter. The scrip had an average daily volume of 14.19 lakh shares in the past one quarter.

The stock hit an intraday low of Rs 1176.20, also its 52-week low. It hit a intraday high of Rs 1207.65 so far during the day. The stock had a 52-week high of Rs 3252.10 on 15 January 2008.

The stock lost 13% in two consecutive sessions to Rs 1215.25 on 23 October 2008 from a recent high of Rs 1397 on 21 October 2008.

The stock had underperformed the market over the past one month till 23 October 2008, declining 39.53% as compared to the Sensex’s decline of 27.99%. It had also underperformed the market in the past one quarter, falling 46.36% as compared to the Sensex’s decline of 34.60%.

India’s largest private sector firm by market capitalisation and oil refiner has an equity capital of Rs 1573.79 crore. Face value per share is Rs 10.

The current price of Rs 1191 discounts its Q2 September 2008 annualised EPS of Rs 113.40, by a PE multiple of 10.50.

The net profit rose 7.4% to Rs 4122 crore on 39.8% growth in sales to Rs 44787 crore in Q2 September 2008 over Q2 September 2007. The gross refining margins (GRM) stood at 13.4% in September 2008, weaker from $15.7 posted in June 2008 quarter and $13.7 in September 2007 quarter. The GRM is the difference between the selling price of the finished products and raw material cost.

Meanwhile, Reliance Industries has reportedly closed half its polypropylene plant at Jamnagar, Gujarat, because demand for the raw material used for packaging has slowed. The plant has a capacity of around a million tonne a year. RIL, in the meantime, has denied rumours that suggested Chevron may sell 5% in its unit, Reliance Petroleum.

On 22 September 2008, Reliance Industries (RIL) said it had started production of crude oil at KG-D6 block of the Krishna Godavari basin. The field will initially produce about 5,000 barrels of crude per day and is expected to reach its peak production of 5,50,500 barrels of crude per day over the next six to eight quarters.

On 3 October 2008, Reliance Industries said it has alloted 12 crore equity shares of face value Rs 10 each to various promoter group firms upon exercise of rights attached to warrants held by them. These equity shares would be subject to a lock-in for a period of three years from the date of allotment of the warrants. The conversion price for the warrants is Rs 1,402 per share.

Reliance Industries manufactures petrochemicals, synthetic fibers, fiber intermediates, textiles, blended yarn and polyester staple fiber. The company also owns a petroleum refinery cum petrochemicals complex in Jamnagar, India that produces a wide range of products such as gasoline, superior kerosene oil and liquified petroleum gas.

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