Reliance Industries Ltd posted its highest quarterly earnings in more than two years as a weaker rupee bolstered export earnings.
Net income for the first quarter met analyst forecast as margins rebounded from the prior three months. Also, earnings for the firm that’s controlled by India’s richest man, billionaire Mukesh Ambani, were boosted by revenue from projects it started.
According to Bloomberg, higher profits for the owner of the largest oil refinery complex in the world is sending analysts most upbeat over the company’s stock in more than two years, with its shares having jumped to the highest since May 2011.
Profits rose to $933 million or 56.3 billion rupees as per share earnings jumped to 17.4 rupees in the quarter. That compares to 55.9 billion rupees or 17.3 rupees per share a year earlier, the firm reported today in a stock exchange filing today.
Sales advanced 13% to 951.9 billion rupees.
“Sales during the quarter could have been better but for the declining gas production and lower refinery production due to a shutdown in February,†said R.K Gupta of Taurus Asset Management Co. in New Delhi.
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Reliance’s stocks, which have soared 20% since the 28th of February in comparison with a 15% rise in the 10-member S&P BSE Oil Index, surged 1.9 to 959.10 rupees on Thursday.
The company runs two oil refineries with a joint output of 1.24 million barrels per day based at Jamnagar in Gujarat. The plants have the capacity to refine cheaper and lower grade crude into high quality shipments for Europe and the US.
According to Thomson Reuters, the energy conglomerate was expected by analysts to post a net profit of 56.62 billion rupees.
Most of Reliance’s energy exports are settled in dollars. Thus, a weak rupee against the greenback boosts the company’s earnings from exports when converted to the Rupee.
To contact the reporter of the story: Yashu Gola at yashu@forexminute.com
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