Reliance Industries dips on profit booking post Q3 results

In past two months, the stock outperformed the market by gaining 12% against 5% decline in Sensex till yesterday.

Reliance Industries (RIL) has dipped 4% to Rs 999 on the BSE on profit booking after the stock had gained ahead of its third quarter earnings. 

The company late Tuesday announced a 39% increase in its consolidated net profit at Rs 7,290 crore for the third quarter of this financial year (Q3FY16).

Consolidated net sales stood at Rs 68,261 crore, a drop of 27% over Rs 93,528 crore in the corresponding period of the previous year. The decline in revenue was led by the 43% year-on-year (Y-o-Y) decline in benchmark Brent crude oil price, RIL said.

On standalone basis, the company reported 42% Y-o-Y jump in profit at Rs 7,218 crore for Q3FY16 on strong performance of refining business and higher other income. The company reported revenue of Rs 56,567 crore for the quarter against Rs 80,196 crore in Q3FY15 due to the steep drop in oil prices.

Gross refining margin jumped to seven-year high at $11.50 per barrel during the quarter, an increase of 8.5%, compared to $10.6 per barrel in the previous quarter. Benchmark Singapore complex margin averaged at $8.0 per barrel during the quarter.

“Strong gasoline and naphtha cracks, seasonal rebound in middle distillates cracks, robust demand growth and sourcing of advantageous crude helped boost refining margins. EBIT was also boosted by the all-time high crude throughput of 18 MMT (utilisation rate of 116%),” RIL said in a statement.

Angel Broking retains “Accumulate” rating on the stock with a target of Rs 1,150.

“Overall, the results were ahead of expectations with the focus now on the launch of RJio services,” the broking firm said in a client note.

In past two months, the stock had outperformed the market by gaining 12% as compared to 5% decline in S&P BSE Sensex till yesterday.

At 10:01 a.m. the stock was down 2.9% at Rs 1,014 against 1.5% fall in the benchmark index. A combined 4.14 million shares changed hands on the counter on the BSE and NSE so far.