Reliance Industries Ltd. share price target

Q1FY21, Operating Profit down 22% and Net profit up 31%, above estimates RIL achieved revenue of Rs 91238 crore in Q1FY21 a decrease of 44% as compared to Rs 162353 crore in the corresponding period of the previous year. Decrease in revenue is primarily...

Key highlights from Reliance Industries' (RIL) Q1FY21 results: (a) EBITDA below estimates at Rs 169bn (21% YoY), (b) cyclicals mixed GRM at US$ 6.3/bbl outperformed estimates while petchem EBITDA at Rs 44bn (50% YoY) fell short, (c) retail EBITDA underperformed at Rs 10.8bn (47% YoY) whereas RJio EBITDA was higher at Rs 78bn (+59% YoY) on better ARPU.

Our higher multiple (Bharti India mobile valued at 12x EV/EBITDA) captures the digital revenue opportunity, expected gains from any potential tariff hikes, growing market share and possible rationalization of tax levies for the sector, which are not built into our Reliance Retails revenue declined 17% YoY to INR316b. to improve supply chain to handle home delivery and has already converted some Reliance market stores, partly Reliance Retail is leveraging the AJio platform to drive remained shut and 29% were operating partially. Also, China is likely to export more with an increase in its refinery throughput, deepening the supply glut and enhancing the pressure on product Counter measures by RIL includes focus on its deep petrochemical integration and to expand its fuel marketing business (currently, MS/HSD demand recovery in India is ~90% of Jan levels).

Reliance Industries (RIL) Q1FY21 adjusted EBITDA was below our estimates but adjusted PAT beats estimates due to deferred tax write back. Petchem (Rs34bn, IDBIest Rs37 bn), Refining (Rs29bn, IDBIest Rs35 bn) and Retail (Rs7.2bn, IDBIest Rs11.5 bn) EBIT disappointed while Jio EBIT (Rs47bn, IDBIest Rs45 bn) was slightly above expectations. Reported GRM came at US$6.3/bbl vs our estimate of US$6.6/bbl. The company highlighted strong traction at Jio would continue with faster roll out of Jio Fiber and improvement in ARPU. However, O2C business would continue to see challenges in near term. We keep our estimates and TP unchanged at Rs2,154. Though, due to recent...

We raise our PT on RIL to factor higher valuation in Jio and retail business on rollover to FY23E vs earlier Sept 22 to factor in higher multiple. We value the hydrocarbon business in Sept 22 valuation at EV/E of 8.5x vs 8x earlier....

Reliance Industries (RIL) hosted its 43rd AGM and made several key announcements. Few key announcements were 1) Google agreed to invest Rs337.4 bn to pick-up 7.7% stake in Jio Platform, 2) ready with home grown 5G solutions, 3) spinning off its O2C (Oil-to-Chemicals) business, 4) delay in Saudi Aramco deal due to disruption in energy market, 4) Net-debt free before stipulated timeline, and 5) few new offerings in Jio including a new handset in collaboration with Google. We have factored-in right issues and stake sale of Jio in our model. We expect the company's EBITDA to grow 2.9%/+42.3% while PAT to grow by -17.3%/+65.6% in FY21/FY22, respectively. We are raising our EBITDA estimates upwards by 6% and 7% for FY21 and FY22 to factor in...

10 July 2020 Reliance Industries (RIL) focus and determination with which it has executed its foray into digital and retail segments is highly commendable. This has resulted in our own equity valuation for digital and retail changing from INR315/share three years back to INR1,385/share currently. RILs digital segment has seen partnerships with global giants like Facebook, Microsoft, Intel and host of well known global private equity players. As RIL has achieved a decent foothold in both digital services and organized retail, we believe it would now turn its focus to the oil-to-chemicals project, for which it has signed an MoU with Saudi Aramco. In a conventional refinery, only three products (petrol, diesel and ATF) comprising 60-70% of the product slate, command positive margins. Globally, a conventional refinery produces ~8% of naphtha, which may be used as chemical feedstock. Comparatively, RIL has 24% conversion rate of oil-to-chemicals currently.

Reliance Industries rights issue will be listed on June 15. The rights shares present a very interesting option to participate in company's equity because of the staggered payment plan divided into three tranches of 25% at time of application (already paid), 25% in May 2021

5 June 2020 Net D:E RIL has announced that Mubadala would invest INR90.94b in Jio Platforms for 1.85% equity stake at post-money equity value of INR4.91t and at EV of INR5.2t. Jio Platforms valuation in this deal is in line with the previous four deals at INR4.91t post-money equity. Mubadalas investment is fresh equity infusion into Jio Platforms (like the previous deals) and would not dilute the stake of earlier investors (Facebook, Silver Lake, Vista, General Atlantic and KKR) as RJios capital structure is fixed and this is fresh equity through conversion of OCPS (held by WOS of RIL). Similar to the previous deals, Jio Platforms is expected to retain 10% of the cash and the rest would be transferred to its parent company, which could be subsequently used for deleveraging. Moreover, 10% of Mubadalas investment (INR90.94b) would flow to Jio Platforms and the rest would to the parent company.

RIL have raised Rs670bn through sale of stake in Jio platform to multiple global investors. To further strengthen B/S and capitalize on global opportunities amidst the Covid-19 pandemic, RIL plans to raise Rs531bn...