Indian market’s big boy, Reliance Industries is scheduled to announce its third quarter results on January 20. The oil-to-retail conglomerate is expected to report operationally better results led by strength in GRMs, lower windfall tax impact, higher gas realization, steady telecom and retail performance.
Prabhudas Lilladher expects the company to report a profit after tax (PAT) of ₹94,282 crore – a growth of 12.8% year-on-year – on sales of ₹13,24,585 crore – an year-on-year growth of 7.3%.
The brokerage cut its fiscal year 2023 earnings estimate by 13% due to lower petrochemicals margins on the back of Chinese demand volatility. “We also increase finance charges for FY23-25E given continued exchange rate depreciation; FY25 EPS is cut 3.5%,” it said.
For Jio, Prabhudas Lilladher expects RIL Q3 revenue to grow to ₹23,480 crore (+4.3% QoQ). EBITDA is expected to follow to ₹12,110 core, (+5.5% QoQ). We have also factored in ARPU of ₹182 (+2.7%QoQ) and subscriber addition of 5 million in Q3 (7.7mn in Q2).
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Meanwhile, Sharekhan by BNP Paribas has named RIL, IGL, MGL and GSPL as its preferred picks in oil & gas segment.
“We prefer RIL among downstream players, given its strong growth outlook for consumer-centric business (retail and Jio) and likely further value unlocking in digital and retail businesses would add to shareholders’ returns in the coming years,” the brokerage said in a report.
Sharekhan expects the third quarter consolidated profit after tax to come in at ₹17,316 crore on sales of ₹2,21,949 crore – a 20% jump year-on-year, but a 3.5% fall on a sequential basis. It expects operating margins for the said quarter to come in at 15.7%.
As for the stock performance, Prabhudas Lilladher has maintained buy rating with a revised target of ₹2,909 (Rs2,870 earlier) rolling over to FY24E.
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On the other hand, Sharekhan has put target price at ₹3,050 with a buy recommendation estimating an earnings per share of ₹112.1 for fiscal 2023 and ₹143.9 for fiscal 2024.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.
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