Mumbai, July 27: Reliance Industries’ (RIL) first-quarter profit grew at a better-than-expected rate of 30.16 per cent to Rs 1437 crore from Rs 1104 crore same time last year.
The performance was impressive considering the fact that the company had to live with a spurt in prices of crude oil, its prime feedstock, to record levels. Operating margins, a measure of its efficiency, were higher in petrochemicals and refining, its two main businesses.
Revenues from petrochemicals grew 17.33 per cent, while those from refining went up by around 29 per cent.
Anil D. Ambani, vice-chairman and managing director, said: “The improvement in our margins and profitability has been achieved by overcoming the challenge of record high crude prices, our major feedstock.” He said he was looking forward to another year of record-breaking financial performance, barring unforeseen circumstances in operating conditions.
The market, however, did not appear to be elated at the numbers. The Reliance stock dipped Rs 12.65, or 2.64 per cent, over its previous close to end at Rs 464.95 on BSE.
Gross turnover jumped 21 per cent to Rs 20,763 crore while net turnover was up 17 per cent at Rs 15746 crore. Higher sales were the result of an 18 per cent price increase and a 3 per cent rise in volumes over April-June 2003. Other income, mainly representing interest and premium accrued on preference shares, was pegged at Rs 347 crore, up 85 per cent from Rs 187 crore.
The increase in operating margin to 13.5 per cent was driven by a higher degree of integration and value addition, rising prices, sharper focus on speciality products and cost management, though this was partially offset by spiralling raw material costs across the board.
Production of oil/gas and petrochemicals, including toll conversion, increased to 3.19 million tonnes against 2.76 million tonnes for the corresponding previous quarter, an increase of 16 per cent. Its Jamnagar refinery operated at a 118 per cent capacity, processing 7.91 million tonnes of crude in the quarter. Gross refining margins went up to $7.5 per barrel from around $6.5 during the first quarter of last fiscal.