RIL share falls over 4% after Q3 revenue takes pandemic hit

Share of Reliance Industries Limited (RIL) fell over 4% in early trade after the conglomerate reported Q3 revenue, which fell below estimates. RIL share plunged 4.7% to Rs 1,953.40 against previous close of Rs 2,049.65 on BSE.

Stock of RIL opened marginally higher at Rs 2,052. RIL's market cap fell to Rs 12.49 lakh crore. RIL stock has lost 5.93% in the last 2 days.

RIL share trades higher than 50 day and 200 day moving averages but lower than 5 day, 20 day and 100 day moving averages. The stock has risen 29.54% in one year but fallen 0.68% since the beginning of this year.

Consolidated revenue of Mukesh Ambani-led oil-to-telecom conglomerate declined 22 per cent to Rs 128,450 crore in Q3 compared to Rs 1,60,447 crore in the year ago period.

However, the firm reported a 12.5 per cent year-on-year growth in consolidated net profit at Rs 13,101 crore in Q3 due to strong rebound across all businesses. The company reported a net profit of Rs 11,640 crore in corresponding period of last year.

"The outbreak of coronavirus (COVID-19) pandemic globally and in India is causing significant disturbance and slowdown of economic activity. The Group's operations and revenue during the period were impacted due to COVID-19," the conglomerate said.

Here's a look at what brokerages said post Q3 earnings of the firm.

Credit Suisse has a neutral call on Reliance Industries with a target price of Rs 1,930. Q3 was a weak one across Retail, O2C & Jio. However, there was good ramp-up in JioMart and Fashion segment. The brokerage cut FY22E/FY23 estimates for earnings per share by 4%/3% due to slow recovery in refining margins, slow pace of net subscriber additions and tepid recovery in retail.

On the other hand,  Goldman Sachs has given a buy call on RIL stock with a target price of Rs 2,390. It said the third quarter earnings were in line with expectations. O2C carve out is underway as consumer business continues to grow.  The brokerage sees earnings recovery along with catalysts around telecom tariff hikes and new product launches.

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