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RIL Q1 Review - Rebound From Lows, But Headwinds Continue: ICICI Securities

RIL Q1 Review - Rebound From Lows, But Headwinds Continue: ICICI Securities

The Reliance Industries Ltd. logo is displayed atop the company’s gas station in Mumbai, India. (Photographer: Dhiraj Singh/Bloomberg)
The Reliance Industries Ltd. logo is displayed atop the company’s gas station in Mumbai, India. (Photographer: Dhiraj Singh/Bloomberg)

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

ICICI Securities Report

Reliance Industries Ltd.’s Q1 FY22 recurring earnings per share was up 48% y-o-y (profit before tax up 111%, but tax up 13.3 times on normalisation) driven by rise in Ebitda across segments and halving of interest cost.

Petrochemicals’ Ebitda was at an all-time high, but gross refining margins remain weak.

RIL's retail Ebitda fell QoQ due to Covid-19 second wave.

Gross refining margin weakness, petrochemical margin fall from peak and a third Covid-19 wave delaying retail recovery may mean more downside to FY22E EPS.

Stock underperformance continues and will continue unless there is a tariff hike, retail growth is back to pre-Covid levels, or GRM recovers.

Click on the attachment to read the full report:

ICICI Securities RIL Q1FY22 Results Update.pdf

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