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Mumbai20 minutes ago
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- The company’s stock was at Rs 2,367 in September, now it is close to 2 thousand rupees.
- Investors are waiting for Mukesh Ambani’s statement that will give them hope.
Reliance Industries Ltd (RIL), the country’s largest company, has hidden a lot of information in its announcements in recent times. Although there is no legal offense, it matters to investors. Because on the basis of this information, investors look at the valuation, business, growth etc. of the company and invest.
RIL should be disclosed in a transparent manner
Some analysts say that RIL should show its commitment to a transparent (transparent) practice. Because now investors are showing more interest in this most valuable private sector company of India. Significantly, RIL has stopped disclosing certain information in the recent quarters. Many analysts are surprised by this.
Cases like expenses, earnings and payments were not disclosed.
The key information that RIL has not disclosed is the expenditure on Jio Mart over the past few quarters, from Jio Platforms Ltd (JPL) to the Infrastructure Investment Trust. Retail revenue at segment level and earnings before interest were also not disclosed. The company has also not made any disclosures on investment and gross refining margin (GRM).
More will have to be revealed in Geomart and JPL
JP Morgan said in a note on 3 February that investors would like more and more disclosures in Geomart and JPL to measure the growth of RIL’s business. Most digital investors in the US and Europe see RIL’s long-standing digital story in the digital arena of JioMart and JPL. They even acknowledge that there is very little opportunity in these businesses to look ahead in the next 12-18 months.
Live the digital business assets of RIL
Jio Platforms has digital business assets of RIL including Jio Infocomm Limited. RIL had disclosed a turnover of Rs 6 lakh 59 thousand 205 crore for the financial year ended in March 2020. It had a profit of 39 thousand 880 crores. It is involved in petroleum refining and marketing, retail and digital services businesses.
RIL did not disclose GRM
In the third quarter earnings report last month, RIL did not disclose GRM for the first time. This is an important measure to assess its refining business. The margin available on every barrel of processed oil is called GRM. RIL said that its refining and petrochemicals business has been merged with Oil to Chemicals (O2C). Analysts are surprised by the company’s decision.
Transparency level has dropped in all business
Edelweiss has said in its report that the level of transparency has dropped in all businesses. RIL has completely stopped reporting critical parameters like GRM. Edelweiss said in a report that similarly it has stopped giving retail a breakdown breakdown.
Otusi’s performance cannot be compared to reporting changes
BNP Paribas said that O2C performance cannot be compared to reporting changes. Which makes it very difficult to attract investors. We are not able to analyze a business at a small level. Because RIL has started clubbing all its O2C operations with each other.
RIL changed business strategy
RIL has now changed its business strategy. Earlier it was relying on the petrochemicals business with its refining and marketing for growth. It is now expanding its consumer business, telecom and retail business. One analyst said that due to lack of disclosures, we feel that during the crisis, RIL’s business has been badly affected. I think that once the business of the company picks up again, it will start giving all this information.
Sold stakes in Jio and Retail, got Rs 1.99 lakh crore
Explain that Reliance had raised Rs 1.99 lakh crore by selling stakes in Jio Telecom and Retail. Out of this, 47 thousand crore was part of retail. The stake was last sold in November in retail. Its stock went up to Rs 2367 in September. After that its stock is between 1800 and 2000 rupees. That is, the trust and expectation that investors had invested, is still not visible in its stock. In such a situation, in the coming time, the company will have to tell what it is doing on which the investors trust and they will be able to give them some returns on their investment.