Indian stock report - Reliance Industries
Reliance Industries rises in 4 out of last 5 days June 20, 2018 15:30 IST
NEWS BITES - BRIC
Reliance Industries Ltd. (NSE:RELIANCE), India's largest Integrated oil & gas company by market cap, has lifted Rs23.20 (2.3%). Compared with the BSE SENSEX Index which rose 260.6 points (0.7%) in the day, the relative price increase was 1.6%. The volume was 0.9 times the average daily trading volume of 8.1 million shares. Reliance Industries' stock rose in four out of the last 5 trading days, for a 5-day rise of 1.7% to close at Rs1,019.25
Highlights in today's Report:
SECTION 1 BULLISH SIGNALS incl. Open Interest
SECTION 2 BEARISH SIGNALS
SECTION 3 RELATED NEWS
SECTION 4 GLOBAL RANKING
SECTION 5 SUMMARY FINANCIALS
SECTION 6 PROFILE
SECTION 1 RELIANCE INDUSTRIES BULLISH SIGNALS
+ 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.
+ Reliance Industries is cash rich with Cash to Market Capitalisation at 10.2%.
+ Net profit margin has averaged 9.1% in the last 3 years. This is better than the sector average of 9.1% and suggests a high margin of safety.
+ Brandirectory have estimated Reliance Industries' brand value at Rs418.6 billion (US$6.1 billion). The Brand Value represents 4.4% of the estimated Enterprise Value of Rs9,559 billion (US$140.2 billion).
1.2 Undervaluation [compared with sector average]:
+ Dividend yield of 0.5% [0.3%].
Uptrend: The stock rose 2.3% on high volatility today and expanding price range.
+ The price increased 1.7% in the last week and jumped 9.4% in the last month.
+ The Moving Average Convergence Divergence (MACD) indicator of 12-day Exponential Moving Average (EMA) of 991.66 minus the 26-day EMA of 976.81 is positive 14.85 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 present value of Rs1,000 (PV1000) invested one year ago in Reliance Industries is Rs1,464, comprising a capital gain of Rs454 and dividend reinvested of Rs11.
|BSE SENSEX Index||996||1,017||1,136|
+ The present value of INR1,000 (PV1000) invested ten years ago in Reliance Industries is Rs1,954, including a capital gain of Rs881 and dividend reinvested of Rs73.
+ 10 years Multiplier in INR = 1.954x
+ Compound Annual Growth Rate (CAGR) in INR = 6.9%
Present Value of USD1,000 invested 10 years ago:
+ The present value of USD1,000 (PV1000) invested ten years ago in Reliance Industries is $US1,230, including a capital gain of $US184 and dividend reinvested of $US46.
+ 10 years ago USD 1 equalled INR 42.9185
+ 10 years Multiplier in USD = 1.23x
+ Compound Annual Growth Rate (CAGR) in USD = 2.1%
Jun 20, 2018: USD 1 equals INR 68.16
1.4 Open Interest:
+ Open interest hit a 14-day high.
+ Open Interest Trend
Same day trend: The price lifted 2.3% from Rs996.05 to Rs1,019.25; Open interest has lifted 2.7% from 71,039,000 to 72,954,000. 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.
|Duration||Open Interest change %||Price change %||Interpretation|
+ Top three traded call options [1 contract is 1000 shares]
|Exercise Price||Exercise Date||Option Price||Change %||Contracts Traded|
|Rs1,020.0||June 28, 2018||Rs12.60||113.6||12753|
|Rs1,040.0||June 28, 2018||Rs5.85||108.9||6597|
|Rs1,000.0||June 28, 2018||Rs23.65||97.1||6057|
1.5 High Performance Indicators:
|Description||RELIANCE Value||Rank In Market|
|Today's Turnover||Rs7.7 billion (US$112.3 million)||In Top 1%|
|Price/MAP50||1.06||In Top Quartile|
|Price/MAP200||1.11||In Top Quartile|
|Price Change %||2.3||In Top Quartile|
|Cash to MCap %||10.2||In Top Quartile|
SECTION 2 RELIANCE INDUSTRIES BEARISH SIGNALS
+ The relative yield of RELIANCE, defined by its yield of 0.5%, divided by average yield of dividend yielding stocks in the BSE SENSEX Index of 1.3% is 40.6%. This suggests Reliance Industries stock is overvalued in dividend yield terms.
+ Total Liabilities/EBITDA of 7.9 which compares unfavourably with the Joseph Piotroski benchmark of 5.
+ As per the Du Pont analysis, Return on Equity of 12.0% is lower than sector average of 12.3%. This is computed as net profit margin of 8.8% times asset turnover [sales/assets] of 0.5 times leverage factor [total assets/shareholders' equity] of 2.8.
2.2 Overvaluation [compared with sector average]:
+ Year-on-Year Earnings Growth of 18.6% [21.0%].
+ Price/Earnings/Growth of 1.2 [0.8].
+ The 0.4% discount to 12-month high of Rs1,023.50 against the 49.8% premium to 12-month low of Rs680.51 suggests the climb might be peaking.
2.4 Overbought/Bearish/Resistance Signals:
+ The Relative Strength Index (RSI) of 84.9 has penetrated the overbought line of 70, suggesting the price gain of 9.5% in the last 14 days is unusually high.
+ The stock is overbought according to the Williams % R indicator of -4.0, suggesting the price is close to its 14-day high of Rs1,023.50.
+ The Money Flow Index [MFI] is 93.5 suggesting an overbought 14-day trend, being above 80. The Money Ratio of 14.5 suggests positive money flow was 14.5 times negative money flow.
2.5 Moving Annual Return
Based on a dynamic start date of 5 years ago, the Moving Annual Return has been positive in 3 of the last 5 years. An investment a year ago in RELIANCE would have produced a return of 46.2%.
|RELIANCE||Close (INR)||Dividends (INR)||Capital Gain / (Loss) %||% Yield||Annual Return %|
|1 Yr ago||701.03||-||44.9||-||44.9|
|2 Yrs ago||483.9||5.25||(1.2)||1.1||(0.1)|
|3 Yrs ago||489.61||5||(3.3)||1||(2.3)|
|4 Yrs ago||506.06||4.75||26.4||1.2||27.6|
Close 5 years ago Rs400.25
+ Beta: the Beta of Reliance Industries stock is 1.7. A Beta greater than 1 suggests this is a high risk, high return stock with volatility greater than that of the market.
2.7 Aggregate Volumes, Prices and Turnover Period:
[Volume Index or VI in brackets; 1 is average]
+ National Stock Exchange: RELIANCE.NSE 7,193,824 [VI of 1.0] volume 95.475% of aggregate. Price: Rs1,019.25.
+ Bombay Stock Exchange: 500325.BSE 340,911 [VI of 0.6] volume 4.525% of aggregate. Day trader volume: 52.1% for the day; 55.4% for the trailing week and 51.8% for the trailing month. Price: Rs1,019.95.
+ Aggregate volume: there were 7.5 million shares of Reliance Industries worth Rs7.7 billion traded today. The aggregate volume was 0.9 times average trading of 8.1 million shares.
The turnover rate in the 12 months to date was 25.6% (or a turnover period of 3 years 10 months). This average length of ownership of the stock at 1.4 times the average holding period of 2 years 8 months for stocks in the BSE SENSEX Index suggests a larger number of core investors, making a long-term investment safer.
+ Reliance Industries Ltd. (NSE:RELIANCE), gained Rs98.20 (or 10.7%) year-to-date (YTD) in 2018 to close at Rs1,019.25 today. This means the stock has outperformed 86% of India-listed stocks in 2018. Compared with the BSE SENSEX Index which has risen 4.4% YTD, this is a relative price increase of 6.3%.
SECTION 3 RELIANCE INDUSTRIES RELATED NEWS
3.1 Corporate Wires
Reliance Industries (RELIANCE) issued 1 new Release this week.
June 19: 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 June 20, 2018 the designated security codes thereof shall be as specified in Annexure.
To view the previous 3 months' Releases in full, click here
3.2 Other News
+ BSS/News Bites:
Reliance Industries Ltd. is placed 406/2489 in BSS News Bites' ranking of Indian performers in the past year, a percentile ranking of 84.
+ Vanguard Total World Stock ETF 7581:
The stock was one of 7581 global stocks selected by Vanguard Total World Stock ETF (VT) who bought 38,439 shares in the period Jan 31, 2018 to Apr 30, 2018 worth $US36,138,745 at an estimated Volume Weighted Average Price (VWAP) of $US940.1583. As at Apr 30, 2018, the Vanguard Total World Stock ETF held 313,986 shares worth $US4,442,708 or 0.03% by value of the ETF's portfolio [Ranked 684 out of 7581 by value and 6 out of 307 for India].
SECTION 4 RELIANCE INDUSTRIES GLOBAL RANKING
Global Rank [out of 47,592 stocks] and Rank in the Asia Region [out of 22,824 stocks]
|Description||Value||Global Rank||In Asia Region|
|Total Assets (US$)||120B||469||121|
|Net Profit (US$)||5.3B||195||43|
|Return on Equity %||12.0||10,803||5,594|
|Net Profit Margin %||8.8||12,931||6,800|
|Price to Book||3.4||26,755||15,953|
|PV$1000 (1Year) US$*||1,386||7,329||3,237|
|US$* Change (1Year) %||35.0||7,081||3,142|
* 1 year ago USD 1 = INR 64.52
Jun 20, 2018: USD 1 equals INR 68.16
SECTION 5 RELIANCE INDUSTRIES SUMMARY FINANCIALS
5.1 Dividend History
+ Trailing 12 months dividend has improved from Rs4.75 in 2014 to Rs5.50 in 2018.
5.2 Financials Summary
|Year ended||Mar 2018||Mar 2017||Mar 2016|
|Sales (USD B)||60.1||50||44.9|
|Pretax (USD B)||7.3||5.9||5.7|
|Net (USD B)||5.3||4.4||4.4|
+ Net profit was up 20.9% from US$4.4 billion in 2017 to US$5.3 billion in 2018.
+ Earnings Per Share (EPS) was up 18.6% from Rs50.57 to Rs60.0.
SECTION 6 RELIANCE INDUSTRIES PROFILE
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 Top Management
The chairman is Mukesh D Ambani.
6.3 Issued Capital
Based on 6,334,130,027 issued shares the market capitalisation is Rs6,456.1 billion (US$94.7 billion).
Physical Address: 3/F Maker Chambers IV 222 Nariman Point Mumbai, 400 021 India
Country of Incorporation: India
Exchange: National Stock Exchange
Economic Sector: Energy
Business Sector: Energy - Fossil Fuels
Industry Group: Oil & Gas
Industry: Integrated Oil & Gas
Activity: Integrated Oil & Gas
NSE:RELIANCE; BSE:RELIANCE; NS:RELIANCE; IN:RELIANCE; RELI.NS
Reliance Industries Limited, Reliance Industries Ltd