Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Betting on new business to drive future growth
Confident of robust outlook in various business segments. Believes current refining margin is likely to be prolonged while
petrochemical earnings could double in next few years. Outlook from upstream business is that of maintaining current
production levels while it believes new businesses like retail and telecommunications offer long-term growth potential.
Gross refining margin of USD9-9.5/bbl in CY2011 and USD10/bbl by CY2012.
Expects to maintain current levels of production in KG-D6 block for next few quarters.
Share of production from shale gas investment could reach 400bcf/d by CY2015.
RCOM has already spent cUSD1.2bn on Retail business and expects to spend cUSD0.2bn more. Retail business could also
break even by next quarter.
Valuation and risks
We value RIL’s downstream business using the average of 13x PE and 8x EV/EBITDA on FY12e earnings (in line with
peers). We also value the recent shale acquisitions, Pioneer and Atlas Energy, on a DCF basis.
Key risks to our earnings and valuation, both on the upside and downside, are refining margins, petrochemical margins and
production from KG-D6 being different from our assumptions.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Betting on new business to drive future growth
Confident of robust outlook in various business segments. Believes current refining margin is likely to be prolonged while
petrochemical earnings could double in next few years. Outlook from upstream business is that of maintaining current
production levels while it believes new businesses like retail and telecommunications offer long-term growth potential.
Gross refining margin of USD9-9.5/bbl in CY2011 and USD10/bbl by CY2012.
Expects to maintain current levels of production in KG-D6 block for next few quarters.
Share of production from shale gas investment could reach 400bcf/d by CY2015.
RCOM has already spent cUSD1.2bn on Retail business and expects to spend cUSD0.2bn more. Retail business could also
break even by next quarter.
Valuation and risks
We value RIL’s downstream business using the average of 13x PE and 8x EV/EBITDA on FY12e earnings (in line with
peers). We also value the recent shale acquisitions, Pioneer and Atlas Energy, on a DCF basis.
Key risks to our earnings and valuation, both on the upside and downside, are refining margins, petrochemical margins and
production from KG-D6 being different from our assumptions.
No comments:
Post a Comment