| Reliance Industries, India's largest company by market value, today announced a 28.2 per cent rise in its net profit in the first quarter due to robust refining margins and higher exports. |
| The net profit for the quarter ended June 30, 2007, went up to Rs 3,264 crore against Rs 2,547 crore in the corresponding period a year ago. The company's gross margins on refining, which contribute 77 per cent to its total revenues, increased to $15.4 a barrel, the highest ever. The figure was $13 a barrel in the preceding quarter and $12.4 a year ago. |
| Analysts said the better margin was a result of the company's ability to buy cheap and sell premium products. Its highly complex refinery also allows the company to buy and process some of the heaviest and sour crude oil in the world. |
| The company's exports in the first quarter rose 30 per cent to over Rs 16,000 crore. |
| Reliance, which produces polyester fibre, yarn and paraxylene as well, posted a 12.7 per cent rise in turnover at Rs 29,493 crore (Rs 26,166 crore). The rise in revenue was due to 3 per cent growth in prices and a 10 per cent hike in volume. |
| Aanalysts said rising cotton prices may lead to even better profitability in the near future. "Polyester margins are likely to go up as high cotton prices will divert demand to synthetic fibres. Reliance, being the world's largest yarn producer, will stand to gain from this," they added. |
| Cash profit increased by 23.7 per cent to Rs 4,527 crore while operating profit went up by 22 per cent to Rs 5,177 crore. Net operating margin was 18.5 per cent against 17.3 per cent a year ago. Earnings per share stood at Rs 23.4 against Rs 18.3 a year ago. |
| Interest costs were higher by 8 per cent to Rs 288 crore due to increased borrowings. The company capitalised Rs 163 crore on interest against Rs 149 crore a year ago. Interest cost included Rs 23 crore on account of exchange rate difference. |
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