Indian stock report - Reliance Industries

INDIA

Reliance Industries increases 1.3% January 19, 2018 15:30 IST

NEWS BITES - BRIC

Reliance Industries Ltd. (NSE:RELIANCE), India's largest Integrated oil & gas company by market cap, has increased Rs11.60 (1.3%) from its last trading session of January 18 to close at Rs931.30. Compared with the BSE SENSEX Index which rose 251.3 points (0.7%) in the day, the relative price increase was 0.6%. The volume was 0.3 times the average daily trading volume of 18.8 million shares.

Highlights in today's Report:

SECTION 1 BULLISH SIGNALS

Fundamentals, Undervaluation [compared with sector average], Technicals, Open Interest, High Performance Indicators

SECTION 2 BEARISH SIGNALS

Fundamentals, Technicals, Low Performance Indicators, Moving Annual Return, Beta, Aggregate Volumes, Prices and Turnover Period

SECTION 3 RANKING

Global, Independent Ratings

SECTION 4 FINANCIALS

Financials Summary, Trailing 12 Months Dividends

SECTION 5 CORPORATE BONDS

SECTION 6 PROFILE

Activities, Industry & Sector, Top Management, Issued Capital

SECTION 7 STOCK BUZZ

SECTION 1 RELIANCE INDUSTRIES BULLISH SIGNALS

1.1 Fundamentals:

+ Tobin's Q Ratio, defined as MCap divided by Total Assets, is 0.8. Compared with the rest of the market the stock is undervalued.

+ The company is cash rich with Cash to Market Capitalisation at 10.4%.

+ Interest cover defined by EBIT/I is 11.4 times. This indicates it is less leveraged.

+ Net profit margin has averaged 8.3% in the last 3 years. This is better than the sector average of 8.1% and suggests a high margin of safety.

+ Brandirectory have estimated Reliance Industries brand value at Rs391.1 billion (US$6.1 billion). The Brand Value represents 5.0% of the estimated Enterprise Value of Rs7,763.4 billion (US$121.9 billion).

+ As per the Du Pont analysis, Return on Equity of 11.3% is better than sector average of 10.8%. This is computed as net profit margin of 8.8% times asset turnover [sales/assets] of 0.48 times leverage factor [total assets/shareholders' equity] of 2.7.

1.2 Undervaluation [compared with sector average]:

+ Dividend yield of 0.6% [0.3%].

1.3 Technicals:

+ The Moving Average Convergence Divergence (MACD) indicator of 12-day Exponential Moving Average (EMA) of 929.76 minus the 26-day EMA of 926.71 is positive 3.04 suggesting a bullish signal. Both EMA prices are rising, another bullish signal.

+ Rises to Falls: in the past month the number of rises outnumbered falls 15:8 or 1.9:1.

+ The 2.9% discount to 12-month high of Rs959.50 against the 85.2% premium to 12-month low of Rs502.71 suggests the stock continues to push for new highs.

+ In the last three months the stock has hit a new 52-week high five times, pointing to an uptrend.

+ The present value of Rs1,000 (PV1000) invested one year ago in Reliance Industries is Rs1,828, comprising a capital gain of Rs815 and dividend reinvested of Rs13.

PV10001-week1-month1-year
RELIANCE.NSE9811,0061,828
BSE SENSEX Index1,0271,0491,300

+ The present value of INR1,000 (PV1000) invested ten years ago in Reliance Industries is Rs1,436, including a capital gain of Rs382 and dividend reinvested of Rs53.

+ 10 years Multiplier in INR = 1.436x

+ Compound Annual Growth Rate (CAGR) in INR = 3.7%

Jan 19, 2018: USD 1 equals INR 63.69

1.4 Open Interest:

+ Open interest hit a 15-day high.

Open Interest Trend

Same day trend: The price increased 1.3% from Rs919.70 to Rs931.30; Open interest has lifted 2.8% from 78,034,000 to 80,205,000. A price rise combined with an increase in open interest suggests there is new money coming into the market from existing or new buyers. This is a bullish signal.

DurationOpen Interest change %Price change %Interpretation
1-day2.81.3Strong Market

Top three traded call options [1 contract is 1000 shares]

Exercise PriceExercise DateOption PriceChange %Contracts Traded
Rs940.0January 25, 2018Rs14.308.77908
Rs920.0January 25, 2018Rs23.9516.32950
Rs900.0January 25, 2018Rs37.6018.4409

1.5 High Performance Indicators:

DescriptionValueRank In Market
Today's TurnoverRs4.8 billion (US$75.2 million)In Top 1%
Volatility %1.3In Top 7%
Cash to MCap %10.4In Top Quartile

SECTION 2 RELIANCE INDUSTRIES BEARISH SIGNALS

2.1 Fundamentals:

+ The relative yield of the stock, defined by its yield of 0.6%, divided by average yield of dividend yielding stocks in the BSE SENSEX Index of 1.3% is 44.7%. This suggests the stock is overvalued in dividend yield terms.

+ Total Liabilities/EBITDA of 7.9 which compares unfavourably with the Joseph Piotroski benchmark of 5.

2.2 Technicals:

+ The price decreased 1.9% in the last week.

2.3 Low Performance Indicators:

DescriptionValueRank In Market
EPS Growth %0.4In Bottom 1%
% Prem to Vol Wtd Price0.4In Bottom 6%

2.4 Moving Annual Return

Based on a dynamic start date of 5 years ago, the Moving Annual Return has been positive in 4 of the last 5 years. An investment a year ago in RELIANCE would have produced a return of 82.6%.

RELIANCEClose (INR)Dividends (INR)Capital Gain / (Loss) %% YieldAnnual Return %
Jan 19931.35.581.51.182.6
1 Yr ago513.095.252.71.13.8
2 Yrs ago499.54518.31.219.5
3 Yrs ago422.344.75(0.8)1.10.3
4 Yrs ago425.78-(1.5)-(1.5)

Close 5 years ago Rs432.15

2.5 Beta:

+ Beta: the Beta of Reliance Industries stock is 1.4. A Beta greater than 1 suggests this is a high risk, high return stock with volatility greater than that of the market.

2.6 Aggregate Volumes, Prices and Turnover Period:

[Volume Index or VI in brackets; 1 is average]

+ National Stock Exchange: RELIANCE.NSE 4,559,564 [VI of 0.5] volume 88.365% of aggregate. Price: Rs931.30.

+ Bombay Stock Exchange: 500325.BSE 600,361 [VI of 0.1] volume 11.635% of aggregate. Day trader volume: 52.1% for the day; 55.4% for the trailing week and 51.8% for the trailing month. Price: Rs929.35.

+ Aggregate volume: there were 5.2 million shares of Reliance Industries worth Rs4.8 billion traded today. The aggregate volume was 0.3 times average trading of 18.8 million shares.

The turnover rate in the 12 months to date was 54.1% (or a turnover period of 1 year 10 months). This average length of ownership of the stock at 0.7 times the average holding period of 2 years 9 months for stocks in the BSE SENSEX Index suggests a slightly larger number of speculators on the share register, making it less safe for long-term investors.

SECTION 3 RANKING

3.1 Global Rank [out of 47,420 stocks] and Rank in the Asia Region [out of 22,532 stocks]

DescriptionValueGlobal RankIn Asia Region
MCap (US$)92.6B12921
Total Assets (US$)110.6B486127
Revenue (US$)53.1B19358
Net Profit (US$)4.7B20952
Return on Equity %11.311,4646,073
Net Profit Margin %8.812,6236,643
Price to Book3.725,11914,618
Price/Earnings18.29,9325,003
Yield %0.618,8599,731
PV$1000 (1Year) US$*1,9534,4452,227
US$* Change (1Year) %91.04,2472,130

* 1 year ago USD 1 = INR 68.03

Jan 19, 2018: USD 1 equals INR 63.69

3.2 Independent Ratings

+ IHS Energy 50:

Reliance Industries Ltd. was ranked 25 in IHS Energy's list of Top 50 Energy Companies 2013; a deterioration over a year from rank 21 in 2012.

+ Platts 250:

It is the 3rd largest company in the Platts Top 250 Global Energy Company Rankings.

+ FT 500:

It is the 75th largest by revenue in the FT Global 500.

+ Fortune 500:

It was ranked 203 by total revenues in the Fortune 500 annual list for 2017; an improvement over a year from rank 215 in 2016.

+ Newsweek 500:

It was ranked 438 by Newsweek and Corporate Knights Capital in the World's 500 Greenest Companies 2016. It had outstanding scores of 5% in Carbon productivity.

+ Industryweek 1000:

It is a new entrant in the Industry Week list of the world's largest 1000 manufacturers by Revenues in 2016, ranked 83.

+ Forbes 2000:

It is the 109th largest by revenue in the Forbes Global 2000.

+ BSS/News Bites:

It is placed 637/2734 in BSS News Bites' ranking of Indian performers in the past year, a percentile ranking of 77.

+ Vanguard Total World Stock ETF 7457:

The stock was one of 7457 global stocks selected by Vanguard Total World Stock ETF (VT). As at November 30, 2017, the Vanguard Total World Stock ETF held 255,407 shares worth $US3,649,295 or 0.03% by value of the ETF's portfolio [Ranked 704 out of 7457 by value and 6 out of 290 for India].

SECTION 4 RELIANCE INDUSTRIES FINANCIALS

4.1 Financials Summary

Year endedMar 2017Mar 2016Mar 2015
Sales (USD B)53.44860.3
Pretax (USD B)6.36.14.9
Net (USD B)4.74.73.7
EPS (INR)50.5750.37540.055

Net profit was down 0.1% from US$4.7 billion in 2016 to US$4.7 billion in 2017. Earnings Per Share (EPS) was up 0.4% from Rs50.38 to Rs50.57.

4.2 Trailing 12 Months Dividends

Trailing 12 Months ToValue (Rs)
19 Jan 20185.5
19 Jan 20175.25
19 Jan 20165
19 Jan 20154.75

SECTION 5 RELIANCE INDUSTRIES CORPORATE BONDS

Key Statistics

MaturityYield to maturity %Yrs to Maturity
May to Oct 20202.92.3 to 2.75

SECTION 6 RELIANCE INDUSTRIES PROFILE

6.1 Activities

Reliance Industries Limited (RIL) is India's largest private sector enterprise, with businesses in the energy and materials value chain. The Group's activities span exploration and production of oil and gas, petroleum refining and marketing, petrochemicals (polyester, fibre intermediates, plastics and chemicals), textiles, retail, infotel and special economic zones. Reliance enjoys global leadership in its businesses, being the largest polyester yarn and fibre producer in the world and among the top five to ten producers in the world in major petrochemical products.

6.2 Industry & Sector

Classification LevelName of Sector
Industry GroupOil & Gas
IndustryIntegrated Oil & Gas
ActivityIntegrated Oil & Gas
Economic SectorEnergy
Business SectorEnergy - Fossil Fuels

6.3 Top Management

The chairman is Mukesh D Ambani.

6.4 Issued Capital

Based on 6,332,550,000 issued shares the market capitalisation is Rs5,897.5 billion (US$92.6 billion).

SECTION 7 STOCK BUZZ

Corporate Wire

To view Recent Company Headlines, click here

January 12: Reliance Industries: Board Meeting On January 19, 2018

We wish to inform you that, pursuant to Regulation 29 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ('Listing Regulations'), a meeting of the Board of Directors of the Company is scheduled to be held on Friday, January 19, 2018, inter alia, to consider and approve standalone and consolidated unaudited financial results of the Company for the quarter / nine months ended December 31, 2017.

Pursuant to this, the Company has decided that the close period (i.e.

January 12: Reliance Industries: Listing of further issue

In pursuance of Regulation 3.1.1 of the National Stock Exchange (Capital Market) Trading Regulations Part A, it is hereby notified that the list of securities further admitted to dealings on the National Stock Exchange (Capital Market segment) with effect from January 15, 2018 the designated security codes thereof shall be as specified in Annexure.

January 05: Reliance Industries: Allotment of ESOP / ESPS

The Company has allotted 4,16,031 equity shares of Rs.10/- each, on January 2, 2018 pursuant to the Employees Stock Option Scheme.

January 02: Reliance Industries: Press Release / Media Release (Revised)

RIL commissions the world's largest refinery off-gas cracker at Jamnagar.

December 28 2017: Reliance Industries: Press Release / Media Release

We enclose a copy of Media Release issued by Reliance Jio Infocomm Limited, subsidiary of the Company, titled 'RELIANCE JIO TO ACQUIRE WIRELESS INFRASTRUCTURE ASSETS FROM RELIANCE COMMUNICATIONS, ASSETS TO BE TRANSFERRED FREE AND CLEAR OF ENCUMBRANCES'.

Contact: 022-22785000

Physical Address: 3/F Maker Chambers IV 222 Nariman Point Mumbai, 400 021 India

State/Province/Country: India

Country of Incorporation: India

Exchange: National Stock Exchange

ISIN: INE002A01018

NSE:RELIANCE; BSE:RELIANCE; NS:RELIANCE; IN:RELIANCE; RELI.NS

PermID: 4295872979

Reliance Industries Limited, Reliance Industries Ltd

Source: www.BuySellSignals.com