The revenue of the oil-to-telecom conglomerate stood at Rs 1.44 lakh crore.
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//$ .each(d.ac,function(i,v) //{ // accStr+=”+v.nm+”; //}); $ .each(d.data,function(i,v) { if(v.flg == ‘0’) { var modalContent = ‘Scheme added to your portfolio.’; var modalStatus = ‘success’; //if error, use ‘error’ $ (‘.mc-modal-content’).text(modalContent); $ (‘.mc-modal-wrap’).css(‘display’,’flex’); $ (‘.mc-modal’).addClass(modalStatus); //$ (‘#acc_sel_port’).html(accStr); //$ (‘#mcpcp_addportfolio .form_field, .form_btn’).removeClass(‘disabled’); //$ (‘#mcpcp_addportfolio .form_field input, .form_field select, .form_btn input’).attr(‘disabled’, false); // //if(call_pg == “2”) //{ // adtxt =’ Scheme added to your portfolio We recommend you add transactional details to evaluate your investment better. x‘; //} //else //{ // adtxt =’ Stock added to your portfolio We recommend you add transactional details to evaluate your investment better. x‘; //} //$ (‘#mcpcp_addprof_info’).css(‘background-color’,’#eeffc8′); //$ (‘#mcpcp_addprof_info’).html(adtxt); //$ (‘#mcpcp_addprof_info’).show(); 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Reliance Industries (RIL) share price gained nearly a percent in the early trade on July 26 after the company reported its June quarter earnings.
On July 23, the company reported June quarter profit at Rs 13,806 crore, up 66.7 percent year-on-year (YoY), with normalised tax provision.
The revenue of the oil-to-telecom conglomerate stood at Rs 1.44 lakh crore. However, the numbers on sequential basis were hit due to weakness in retail, RIL said.
The company posted record consolidated EBITDA for the quarter under review at Rs 27,550 crore, up 27.6 percent YoY and 3.6 percent QoQ on strong oil-to-chemical (O2C) and digital services performance. Consolidated EBITDA margin grew 190 bps QoQ to 17.3 percent.
The EBITDA of digital services stood at a record Rs 9,268 crore. Digital services saw net additions of 14.3 million during the quarter, the company said.
Also Read – Reliance Industries Q1 results: Profit after tax jumps 67% YoY to Rs 13,806 crore, revenue comes in at Rs 1.44 lakh crore
Here is what brokerages have to say about the stock and the company post the June quarter earnings:
Macquarie | Rating: Underperform | Target: Rs 1,350
The research house said it has kept an underperform rating on the stock as there was no incremental update on new energy, JioPhone+, oil-to-chemical stake sale and JustDial acquisition.
The headline EBIT is inline, within this, oil-to-chemical (O2C) and E&P are a beat, while Jio & retail are a miss.
JPMorgan | Rating: Neutral | Target: Rs 2,250
JPMorgan remains neutral on the stock as O2C and E&P offset weak consumer business in another muted quarter.
The earnings are unlikely to help stock reverse underperformance and see stock price remaining in a range.
Nomura | Rating: Buy | Target: Rs 2,400
Broking house maintained buy call as the Q1 EBITDA was in-line as weaker retail offset by better standalone/Jio.
The higher other income & lower interest cost/tax boosts the bottomline. The O2C was resilient, while E&P production/ earnings were sharply up. However, after pandemic impact in Q1, Nomura expect most segments to improve.
Morgan Stanley | Rating: Overweight | Target: Rs 2,262
According to Morgan Stanley, an uplift in the street’s expectations is an imminent. The earnings quality was good, with energy in the driver’s seat. It see both multiples & expectations rising in coming quarters.
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Prabhudas Lilladher | Rating: Buy | Target: Rs 2,416
We change our earnings by -4%/+5.1% for FY22/23E, as we expect growth to be back ended. Despite pandemic restrictions, O2C segment benefitted from higher spreads (polymer margins up 30-40% from pre covid levels, albeit lower sequentially) and cost optimization while Jio performance was steady. Retail was hit by lower footfalls (-46% QoQ), but will pick up as restrictions ease. Recovering economic activity augurs well for all RIL’s business segments and downstream focus will create value, going ahead.
We believe RIL with its stated intention to forge global partnership across businesses, is well positioned to incubate new business and pursue inorganic opportunities with its liquid Balance Sheet.
Motilal Oswal | Rating: Buy | Target: Rs 2,485
RIL believes that new capacity additions in the global polyolefin space should be absorbed by strong demand in Asia. This would keep polyester margin firm in the near term, proving beneficial to integrated players.
Gas production of over 18mmscmd is expected in FY22 (from already commissioned R-Cluster and Sat-Cluster), while the MJ field will be commissioned in 3QFY23. KG Basin is expected to achieve peak production of ~30mmscmd by CY23E.
Also Read – Reliance Jio Q1 results: Net profit up 39% YoY at Rs 3,501 crore, EBITDA stands at Rs 8,892 crore
Sharekhan | Rating: Buy | Target: Rs 2,400
We have lowered our FY2022 earnings estimate by 7% to factor in weak retail performance in Q1FY2022 and have largely maintained our FY2023 earnings estimates. Ramp-up of new revenue streams (home & enterprise broadband, and new commerce initiative) and cyclical recovery in downstream margin to drive 30% PAT CAGR over FY2021-FY2023E.
Strong balance sheet provides scope for acquisitions (like recent announcement to acquire Justdial), which would support faster growth of its new revenue streams and aid market share gain in retail business. Moreover, a potential deal in O2C business (for minority stake sale) and further value unlocking in the digital and retail businesses (with a likely IPO for consumer business in next few years) are key catalysts for the stock and would add to shareholders’ returns in the coming years.
At 09:17 hrs Reliance Industries was quoting at Rs 2,100, down Rs 5.20, or 0.25 percent on the BSE.
The share touched a 52-week high of Rs 2,368.80 and a 52-week low of Rs 1,830 on 16 September, 2020 and 29 January, 2021, respectively.
Currently, it is trading 11.35 percent below its 52-week high and 14.75 percent above its 52-week low.
Disclaimer: MoneyControl is a part of the Network18 group. Network18 is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.
Disclaimer: The above report is compiled from information available on public platforms. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
