RIL hammered

Reliance Industries tanked 6.6% to Rs 2095 with the stock being one of the worst performers among the frontline shares today.

The stock hit a low of Rs 2079.10 and a high of Rs 2265.05 so far during the day. The stock had hit 52-week low of Rs 1680 on 2 July 2007. The stock had struck all-time high of Rs 3252.10 on 15 January 2008.

The company has an equity capital of Rs 1453.65 crore. Face value per share is Rs 10.

The current price of Rs 2095 discounts its Q4 March 2008 annualized EPS of Rs 107.60, by a PE multiple of 19.47.

Reliance Industries (RIL) had recently denied that it has signed formal gas sale contracts with prospective customers in defiance of a Bombay High Court (HC) order. RIL was responding to a notice of motion by Reliance Natural Resources (RNRL) which had alleged that RIL had signed such contracts.

Last year, the HC had ordered RIL not to sign formal contracts till the dispute with RNRL is settled. RIL is free to discuss and negotiate the terms of sale of gas to third parties. The case is now before a division bench. RIL may sign agreements for the sale of gas to third parties only after the court’s decision is in RIL’s favour. The case will come up for hearing before the division bench on 22 July 2008

RNRL requires the gas for its power plants, particularly the Dadri, Uttar Pradesh project. RNRL is to get 28 million standard cubic metres of gas from RIL. The two companies are fighting over the price and quantity of gas to be supplied. RNRL took the issue to court in November 2006 saying RIL was not implementing the demerger scheme.

RIL’s net profit rose 24% to Rs 3912 crore on 36% growth in net sales to Rs 37286 crore in Q4 March 2008 over Q4 March 2007

Reliance Industries is engaged in oil refining, producing and distributing plastic and intermediates, polyester filament yarn, fibre intermediates, polymer intermediates, crackers, chemicals, textiles. It is also into exploration and production of oil and natural gas. The firm also runs retail outlets