RELIANCE INDUSTRIES- Reduction in import duties is a marginal positive::Edelweiss,

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Empowered Group Of Monisters (EGOM) reduced import duty on
crude and petroleum products
The EGOM today reduced the import duty on crude and petroleum products by 5%.
Custom duty on crude was reduced from 5.15% to NIL, diesel and gasoline from 7.725%
to 2.575%. While we are yet to get the official note, we believe that duties on other
products have also been reduced by 5%.
Import duty protection on refiners have increased by 0.5%; GRMs
positively impacted by USD 0.5/bbl
Earlier import duties on LPG and Kerosene was NIL while crude was taxed at 5.15%. This
led to negative duty protection on those products. With the reduction in import duty
on crude, the negative duty protection on Kerosene and LPG has been removed.
Effective net import duty protection for refiners have increased from 1.5% to 2.0%,
leading to a positive impact on GRMs by USD 0.1/bbl.
RIL’s EPS will be positively impacted by INR 0.4/share
Increased duty protection will impact RIL’s GRMs positively by USD 0.1/bbl. This will
positively impact RIL’s EPS by INR 0.4/share. Considering the small impact on EPS, we
continue to maintain our RIL’s FY12E and FY13E EPS at INR 73.7/share and INR
84.2/share. We maintain a BUY recommendation on the stock with an SOTP of INR
1160/share. At INR 871/share, RIL trades at 11.8x and 10.3x FY12E and FY13E EPS.