Reliance Industries Ltd. share price target

Reliance Industries (RIL) Q2FY19 result was completely in line with expectation. Strong petrochemical performance was weakened partially by lower refinery profits. Further, higher rupee depreciation and lower treasury profits took a toll on interest expenses and other income. The company's total capex remained higher at Rs390 bn in Q2FY19, out of which Rs160 bn was invested for Jio and Rs130 bn for RIL standalone. The company also announced a strategic investment of Rs52.3 bn to acquire 66.5% and 51% stake in Den Network and Hathway Cable through preferential issue to accelerate JioGigaFiber business. We keep our estimates largely in line and TP unchanged to Rs1,200. We would wait for stabilization of capex at lower level and...

Our SOTP-based target for RIL is Rs 1,303/sh based on Sep-20 earnings (6.5x EV/e for standalone refining, 8x EV/e for petchem, Rs 30/sh for domestic E&P, 1x EV/invested capital for Shale, 20x EV/e for Retail and 10x EV/e for Telecom. Maintain BUY. 2QFY19 witnessed RIL proving its operational mettle yet again majorly owing to better petchem margins and volumes, despite weak GRMs and macros. Petchem EBIT/kg stood at Rs 21.5/kg up 34% YoY. This expansion of margins was owing to better product mix and use of US ethane/refinery off-gases as a feedstock.

Disclosures on content, Jio phone, project development costs accounting etc would be opportune. We value RJio at 10x Sep-20E EV/EBITDA at an EV of Rs 3tn (Rs 510/sh). Reliance Jios (RJio) subscriber additions (37mn in 2Q) and engagement (voice/data usage/sub) is healthy and steadily inching upward. Acquisition of leading cable companies- Hathway, Den and GTPL will fast-track home broadband acquisitions (Jio aspires 50mn).

18 October 2018 YoY, +7 % QoQ). Premium over Singapore complex stood at USD3.4/bbl. GRM was adversely impacted by the shutdown of FCCU, weaker petrol/ATF cracks and narrower light-heavy differentials. grew 62 % YoY (+3 % QoQ) to INR79.7b, led by favorable margins and strong volume growth. EBIT margin of 18.5 % was lower than 19.9 % in 1QFY19 but marginally higher than 18.3 % in 2QFY18, primarily due to strong polyester chain deltas, stable polymer deltas and feedstock cost optimization. Production volumes were higher on account of ramp-up of ROGC. RIL reported E&P; EBIT loss of INR1.9b v/s a loss of INR960m in 2QFY18 and INR2.5b in 1QFY19. KG-D6 gas production declined to 3.

We expect RIL to continue its steady performance, supported by petchem, while the refinery segment should be driven by the upcoming petcoke gasification project and likely GRM push from IMO norms, potentially from next fiscal. We estimate largely flat consol. EBITDA/PAT qoq in Q2FY19. While we expect refining earnings to be impacted, building 7% lower GRM qoq at US$9.8/bbl, partially offset by a weaker rupee, petchem would be stable with upside risk from Nagothane ethane...

Reliance Industries Ltd.'s first quarter net profit meets street estimates. RIL achieved revenue of Rs 141699 crore for Q1FY19, an increase of 56.5% as compared to Rs 90537 crore in the corresponding period of the previous year. Increase in revenue is primarily on account of higher realizations of refining and petrochemical products led by 49% Y-o-Y increase in Brent oil price. Increased revenues also reflect higher volumes with start-up and stabilization of petrochemicals projects. Robust growth in consumer businesses provided a further boost to revenues. Reliance Retail recorded a sharp 124% increase in revenue to Rs 25,890 crore and Digital Services business contributed Rs 9,653 crore for the quarter....

Revenue increased by 10.13% to Rs. 128756.0 Cr in Q1FY19 when compared to the previous quarter. Reliance Industries Ltd Q1FY19 results Comment

Reliance Industries (RIL) Q1FY19 revenue and PAT was in line with our expectation while EBITDA was 10% above our estimates led by petrochemicals division. Higher tax rate and DDA expenses led to in-line PAT despite strong beat at EBITDA level. DTA gasifiers commenced operation at Jamnagar which is likely to take another 3-6 months for significant contribution to its bottom line. We are revising our crude oil assumption upwards to US$72/65/bbl and exchange rate assumption to Rs68/US$ for FY19/FY20, respectively. We are raising EBITDA by 9.7%/14.4% for FY19/20 but cutting PAT by 2%/0.1% to factor in higher DDA and tax rate. We raise our SOTPbased TP to Rs1,200 from earlier Rs1,150. Due to recent run-up in stock valuation, we are...

Our SOTP-based target for RIL is Rs 1,270/sh based on Jun-20 earnings (6.5x EV/e for standalone refining, 8x EV/e for petchem, Rs 29/sh for domestic E&P, 1x EV/invested capital for Shale, 20x EV/e for Retail and 10x EV/e for Telecom. Maintain BUY 1QFY19 saw RIL yet again proving its operational mettle despite weak global GRMs and macros, owing to better petchem margins and volumes. Petchem EBIT stood at Rs 22/kg up 23/53% QoQ/YoY. This massive expansion of margins was owing to better product mix and use of US ethane/refinery off-gases as a feedstock. Petchem production volumes were up 33.3% YoY to 9.2mmt, with the refinery off gas cracker (ROGC) ramping up.

28 July 2018 Refining EBIT stood at INR52b (-18% YoY, -7% QoQ), with GRM Premium over Singapore complex stood at USD4.4/bbl. grew 94% YoY (+22% QoQ) to INR77b, led by favorable margins and strong volume growth. EBIT margin of 20% was higher than 17% in 1QFY18/4QFY18, primarily due to firm polyester chain deltas, stable polymer deltas, feedstock cost optimization, and a superior product mix. Production volumes were higher on account of ramp-up of ROGC. RIL reported E&P; EBIT loss of INR2.5b v/s loss of INR2.3m in 1QFY18 and INR4.2b in 4QFY18. KG-D6 gas production declined to 4.1mmscmd (-35% YoY, -3.4% QoQ). Shale gas production was down to 23.8bcfe (-31% YoY/QoQ) due to natural decline and temporary shut-in of wells.