The stock is actually down nearly 14% from the peak levels so that surely gives you some comfort level on the stock price front. The results for the latest quarter were also quite interesting. Both the revenues and the profits for the June quarter beat the estimates of the street. The PAT for the June quarter was up by 6.8% at Rs.10,104 crore while the total revenues for the quarter were up by 13% at Rs.157,000 crore. Profits were slightly lower than the March quarter due to the pressure on the GRM. However, the net profit margin of below 6.5% will keep the valuations from getting too aggressive on the upside. That will be a cap for the stock.

The gross refining margins were at $8.10/barrel, which is slightly lower than the street expectation of $8.50/barrel but that was still commendable considering the tough global environment. Also, the GRM reported by the company is twice that of the benchmark Singapore GRM, which is an added cushion for the company. Of course, on a YOY basis the GRMs of RIL are down by nearly $2/barrel. However, the petrochemicals segment which has been a consistent performer, actually underperformed this quarter. Petchem revenues were sequentially down by 11.3% while operating income also fell by 5.9% in this quarter. The weak sales and profits were attributed to lower volumes and weak price realizations on some of the key products of RIL like paraxylene, mono-ethylene glycol etc.

Of course, the story of RIL is not complete without talking about telecom and retail. Telecom revenues came in 6% higher at Rs.891 crore and the subscriber expanded to 331 million making it the second largest entity after Vodafone Idea. The EBITDA of the telecom business was up by 6.5% and margins expanded by 12 bps. Of course debt of nearly Rs.290,000 crore was a major overhang on the stock.