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Reliance Industries Ltd (Q1 FY13)

Reliance Industries Ltd (RIL) reported GRMs of US$7.6/bbl in Q1 FY13 as against US$10.3/bbl in Q1 FY12 and US$7.6/bbl Q4 FY12.

January 01, 1970 5:30 IST | India Infoline News Service
CMP Rs723, Target Rs750, Upside 3.7% 
  • Revenues at Rs918bn, higher by 13% yoy; lower than our estimates

  • OPM falls 491bps yoy driven by fall in EBIT margins of refining and petrochemical segments and also on account of lower contribution of the high margin oil and gas segment

  • GRMs were at US$7.6/bbl v/s our expectations of US$7/bbl

  • Higher cash balance and better yields have resulted in 77% yoy jump in other income

  • PAT at Rs44.7bn was better than our expectations owing to lower effective tax rate

  • Maintain Market Performer rating with a revised 9-month price target of Rs750; key risks: weakness in GRMs, falling petrochemical spreads, increasing regulatory risks in E&P segment 

Result table
(Rs m) Q1 FY13 Q1 FY12 % yoy Q4 FY12 % qoq
Net sales 918,750 810,180 13.4 851,820 7.9
Material costs (783,480) (653,400) 19.9 (728,460) 7.6
Purchases (1,630) (5,730) (71.6) (2,420) (32.6)
Personnel costs (8,470) (8,780) (3.5) (5,970) 41.9
Other overheads (57,700) (43,010) 34.2 (49,340) 16.9
Operating profit 67,470 99,260 (32.0) 65,630 2.8
OPM (%) 7.3 12.3 (491) bps 7.7 (36) bps
Depreciation (24,340) (31,950) (23.8) (26,590) (8.5)
Interest (7,840) (5,450) 43.9 (7,680) 2.1
Other income 19,040 10,780 76.6 22,950 (17.0)
PBT 54,330 72,640 (25.2) 54,310 0.0
Tax (9,600) (16,030) (40.1) (11,950) (19.7)
Effective tax rate (%) 17.7 22.1   22.0  
Reported PAT 44,730 56,610 (21.0) 42,360 5.6
PAT margin (%) 4.9 7.0 (212) bps 5.0 (10) bps
Ann. EPS (Rs) 55.2 69.2 (20.2) 51.8 6.5
Source: Company, India Infoline Research

Segmental performance
Revenues (Rs mn) Q1 FY13 Q1 FY12 % yoy Q4 FY12 % qoq
Petrochemical 218,390 183,660 18.9 214,120 2.0
Refining 853,830 736,890 15.9 762,110 12.0
Oil and gas 25,080 38,940 (35.6) 26,090 (3.9)
EBIT margins (%) Q1 FY13 Q1 FY12 bps yoy Q4 FY12 bps qoq
Petrochemical 8.0 12.1 (402) 10.2 (211)
Refining 2.5 4.3 (182) 2.2 29
Oil and gas 38.8 37.8 93 36.5 231
EBIT contribution (%) Q1 FY13 Q1 FY12 bps yoy Q4 FY12 bps qoq
Petrochemical 36.0 32.1 386 45.0 (905)
Refining 44.1 46.4 (232) 35.1 895
Oil and gas 19.9 21.4 (145) 19.7 22
Revenue contribution (%) Q1 FY13 Q1 FY12 bps yoy Q4 FY12 bps qoq
Petrochemical 19.9 19.1 76 21.3 (145)
Refining 77.6 76.6 102 75.8

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