Reliance - Q3FY14 Result Update
Operational performance in line with expectation
RIL’s Q3FY14 operating profit of Rs76.2bn was in line with our estimate while net profit of Rs55.1bn was 3.7% higher than our estimate of Rs53.2bn on account of higher other income. GRM for the quarter at $7.6/bbl was inline with our estimate while RIL’s premium over Singapore complex GRM increased from $2.2 to $3.3/bbl on account of increase in Arab Light Heavy differential. Petchem EBIT for the quarter declined by 15.2% sequentially to Rs21.2bn, which was 13.8% lower than our estimate on account of lower volumes in polymers and polyester segments and decline in regional deltas for PP, PVC and fibre intermediates. Gas production from KG-D6 declined further to 12.7mmscmd (yoy/qoq -11.8/-1.6mmscmd). Other income increased by 32.5% yoy to Rs23bn (33% of PBT). We revise our target price from Rs939 to Rs952. At the CMP, the stock is trading at 10.4x and 7.2x FY15e earnings and EV/EBITDA respectively.
Actual v/s Estimates
| Y/E, Mar (Rs. m) |
Q3FY14
|
Q2FY14
|
qoq (%)
|
Q3FY13
|
yoy (%)
|
LKP Estimates
|
Deviation (%/bps)
|
| Revenue |
1,035,210
|
1,037,580
|
-0.2%
|
938,860
|
10.3%
|
1,046,593
|
-1.1%
|
| EBITDA |
76,220
|
78,490
|
-2.9%
|
83,730
|
-9.0%
|
76,306
|
-0.1%
|
| EBITDA (%) |
7.4%
|
7.6%
|
-20 bps
|
8.9%
|
-156 bps
|
7.3%
|
7 bps
|
| PAT |
55,110
|
54,900
|
0.4%
|
55,020
|
0.2%
|
53,160
|
3.7%
|
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