Q3FY23 Preview: Reliance Industries: Sales seen at Rs2,415,578 million, PAT at Rs156,635 million
19 Jan, 2023 |
8:11 AM
Strength in Jio, Retail to compensate for weakness in O2C
Result date: 20th January, 2023
Recommendation: Buy
Target price: Rs2,914
Reliance Industries (RIL) could witness weak performance in its O2C business, which could be offset by healthy show of the consumer facing businesses – Jio and Retail. Analysts at IIFL Securities expect RIL’s consolidated earnings to grow 15% sequentially, on the back of:
6% sequential improvement in the O2C business – refining gains offsetting weakness in Petrochemicals; analysts at IIFL Securities expect the middle distillate cracks and complexity of the refining unit cushioning fall in Petchem earnings
10% sequential rise in E&P EBITDA on price hike of 26% QoQ
Retail registering 5% sequential growth due to sales growth mainly, as EBITDA margins likely to remain broadly unchanged.
5% sequential increase in Jio’s EBITDA. The quarter will also witness higher interest costs (INR depreciation + higher interest rates + higher borrowings).
As compared to the year-ago quarter however, Profit After Tax (PAT) will fall 16%.
Important management insights to watch out for:
Further clarity on Rs750 billion investments in the new energy business
