Oil contribution to help Reliance maintain its overvalue

Oil contribution to help Reliance maintain its overvalue – Mail Bonus

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Reliance Industries saw a sharp increase in profit in the quarter due to improved profitability in its refining division, which helped India’s most valuable company return a profit in line with Street’s plans. Continued strength in regional refinement limits and the potential for value creation from new energy components will likely help equities maintain their overvalues. RIL shares withstood the Nifty 50 index by 16% since the beginning of the year and its weight in Nifty reached almost 13%.

The operating profit of the oil-to-chemicals (O2C) segment – the vertical that captures the financial performance of refining and petroleum products – increased by 25% to 14,241 million rupees driven by better margins of refining components. The annual revenue of the O2C business exceeded Rs 5 lakh crore due to high crude oil prices and a better implementation of products in the afterflow. Singapore’s Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gross Gr (Gr) disrupted conflict between Russia and Ukraine.

Regional GRM expanded due to superior product development (product cracks in technical terms) diesel and ATF, as RIL’s refinery has a higher proportion of diesel in its alumina products. As a result, GRM RIL increased higher than regional margins. Every single dollar higher GRM adds about $ 500 million to RIL’s operating profit. The increase in cleaning revenues is likely to continue in the first quarter of FY23 thanks to the regional GRM, which is currently trading at a record high of $ 26 / barrel. GRM is likely to continue to rise as one million barrels per day (mbpd) of Russian refinery’s capacity has gone offline due to the conflict. Also, about 3 mbpd of global capacity is closed due to the pandemic.

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This is the main reason why analysts estimate GRM at $ 12 a barrel for current fiscal policy. This would mean that the contribution from the purge could be more than Rs 40,000 million on FY23. An increase in refining revenues may offset the muted results in petroleum. Petroleum production slowed down due to weaknesses in chain deltas. However, the company is fine-tuning the fuel mix by reducing expensive LNG. In recent years, RIL has used the many inputs it has in its petroleum business and has managed to keep inputs costs as competitive as possible among its peers.

Consumer Facing Biz: Quality Focus

For consumer companies, it continued to focus on quality subscribers instead of adding subscribers only. For the first time in two years, Jio saw a visitor registration rate (VLR) increase to 94%, from about 90%. Rising VLR readings indicate improved subscriber quality. The digital company’s operating profit increased by 9% QoQ to ‘10,918 crore, as it continued to benefit from an increase in average revenue per user (ARPU), reaching ‘167 in March 2022, compared to ‘151.6 in the first quarter. Jio’s total subscribers amounted to 410 million and it lost almost 30 million subscribers due to SIM card integration.

Retail: Maintains momentum

Retailers continue to keep their momentum on footsteps and expand their network. Operating profit in the retail segment increased to ISK 3,584 million, which is a 16.3% profit between years. On a serial basis, some modest growth was seen due to the strong base effect of the December 2021 quarter. Retailers added 793 stores and the total number of stores was 15,196 at the end of March 2022. The Street expects the operating profit of retail shares to increase by 30% over the next two years, driven by various acquisitions, continued investment in building off-line accessories. -to-online infra, and recovery by Covid.

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