Mukesh Ambani led Reliance Industries (RIL) reported an increase of 1.7% in consolidated net profit for second quarter of financial year 2015 to Rs 59.72 billion. Analysts on average had predicted net profit of Rs 59.57 billion.
Cash profit increased by 4.9% to Rs 92.50 billion for the quarter ended Sept. 30, 2014 as compared to Rs 1.5 billion in the same period last year. Net sales for the quarter went down 4.3% Rs 1,133.96 billion for the quarter ended Sept. 30, 2014 over prior year period.
Commenting on the results, Nitin Tiwari, Religare Institutional Research, said, ''RIL's Q2 PAT (standalone) at Rs 57.4 billion came in marginally above estimates on stronger petchem earnings. Maintain HOLD with a revised TP of Rs 1,060 (from Rs 950) as we roll over to Dec'15 earnings and introduce our FY17 estimates.''
Somshankar Sinha and Pooja Gupta, Barclays, said, ''Reliance's 2Q consol net profits came marginally ahead of our expectations at Rs 59.7 billion (flat q/q). With valuations also at a 12% discount relative to its history and at a 15-23% discount to global peers, we find the risk/reward favorable and retain our Overweight rating.''
Satish Mishra, HDFC securities Institutional Research, said, ''RIL reported standalone APAT of Rs 57.4 billion in 2QFY15. Strong polymer margins compensated for the fall in GRM (USD 8.3/bbl vs 8.7) and lower gas volumes. Strong EBITDA at Rs 82.4 billion was partly negated by higher interest cost. Finally, FY18 should see the remaining 20% benefit from capex plus the imported ethane impact on petchem feed mix. We remain positive on RIL on the back of productive capex in the core business. Our SOTP for RIL is Rs 1,100/sh. Maintain BUY.''
Dhaval Joshi, research analyst, Emkay Global Financial Services, said, ''Results were marginally above our and street est. with PAT at Rs 57.4 billion as against our est. at Rs 56 billion. While EBIDTA came at Rs 82.3 billion, grew by 9.4% qoq. GRM came at USD 8.3/bbl vs USD 8.7/USD 7.7/bbl qoq/yoy, mainly due to weakness in light and mid distillates cracks. KGD6 volume continued to decline to 12.5mmscmd vs.13.1mmscmd qoq. Petchem EBIT surged by 27.5% qoq to Rs24bn, on back of strong rebound in polymers, fibre intermediates and aromatics margin. With expected improvement of business profile in refining and petchem in the next 2 years, potential upsides from E&P and attractive valuations, we maintain Buy, with a target price of Rs 1,168.'',
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