Reliance Industries logs 19 pct profit growth in quarter on strong margins

Jul 19 2013, 19:25 IST
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"Reliance achieved strong results during the first quarter of FY 2013-14, while investing in projects that will provide sustainable advantage for a longer period," company Chairman and Managing Director Mukesh Ambani said. Reuters
SummaryHowever, gas production at its flagship KG-D6 field dropped by a steep 53 per cent.

Mukesh Ambani-led Reliance Industries (RIL) today posted a 19 per cent jump in its first-quarter net profit at Rs 5,352 crore on back of stronger margins in its core oil refining and petrochem businesses.

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Net profit soared 18.9 per cent to Rs 5,352 crore, or Rs 16.6 per share, in April-June quarter from Rs 4,503 crore, or Rs 13.8 per share, a year earlier, the company said in a statement.

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Reliance Industries Ltd (RIL), which operates the world's biggest refining complex at Jamnagar in Gujarat, reported a 84 per cent rise in revenue from its shale gas venture in US on rising production. Petrochemical margins improved while retail revenue rose 53 per cent.

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The company posted a better-than-expected gross refining margin of USD 8.4 per barrel in the first quarter ended June, 30. It had earned USD 7.6 on turning every barrel of crude oil into fuel in Q1 of 2012-13 fiscal.

However, gas production at its flagship KG-D6 field dropped by a steep 53 per cent to 49.2 billion cubic feet or 15.32 million cubic metres per day. RIL had produced about 33 mmcmd in April-June quarter last year and 49 mmcmd in Q1 of 2011-12.

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"Fall in production is mainly attributed to geological complexity, natural decline in the fields and higher than envisaged water ingress," RIL said.

Production at Krishna Godavari basin fields has since dropped 14.02 mmcmd this month and government's Directorate General of Hydrocarbons (DGH) predicts it will not rise before 2016-17.

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"Reliance achieved strong results during the first quarter of FY 2013-14, while investing in projects that will provide sustainable advantage for a longer period," company Chairman and Managing Director Mukesh Ambani said.

RIL is investing Rs 1.5 lakh crore in new projects.

Ahead of the results announcement, RIL shares hit a six month high of Rs 923.15.

Performance in Q1, Ambani said, reflects "higher operating rates and embedded options in crude sourcing and product placement, given the size and scale of the refining business."

Robust growth in petrochemical products demand augurs well for our biggest ever expansion programme, he said adding retail

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