Reliance beats street in Q3: Petchem, GRM outperform

Reliance Industries (RIL) surprised the street by reporting better-than-expected December quarter numbers, boosted by higher gross refining margins (GRMs). The company posted a net profit of Rs 5502 crore against the CNBC-TV18 poll estimate of Rs 5060 crore. On a YoY basis, profits grew 24% after four quarters of declining returns. Meanwhile,quarterly revenues stood at Rs 96307 crore compared to the poll estimate of Rs 90750 crore and 10% up, from the year ago period.Attributing the good performance of the company to robust refining margins, chairman Mukesh Ambani said, "RIL's performance has improved in the quarter with margin expansion in petrochemicals and record earnings in the refining business."

Here is a segment-wise performance of the company

Refining division: Revenues grew 12.9% to Rs 86,641 crore,year-on-year. GRMs, a measure of profitability stood at USD 9.6/bbl against USD 6.8/bbl,YoY. The company outperformed the benchmark Singapore complex refinery which recorded GRMs at USd 6.5/bbl during the quarter. Ebit margins of the segment also got better at 4.2% versus 2.2%,YoY. The company processed 17.5 million tonnes of crude at its Jamnagar refinery at an utilisation rate of 113% during the period.The company said its brent cracking margins were also higher,YoY on account of strong gasoline and gas oil cracks which boosted performance.

Petchem division: Sales grew 11.5%,YoY to Rs 22053 crore. Ebit margins however declined to 8.8% from 10.9%,YoY due to higher base price effect.

Exploration and production: Revenues plunged 32.2% to Rs 1921 crore due to the consistent decline in KG-DG output which declined to around 25 mmscmd during the quarter. Ebit margins also came down to 30.7% from 45.7%,YoY.Source: Moneycontrol

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