Reliance to hive off EPC division - Views on News from Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks

MEMBER'S LOGINX

     
Login Failure
   
     
   
     
 
 
 
(Please do not use this option on a public machine)
 
     
 
 
 
  Sign Up | Forgot Password?  

Reliance to hive off EPC division

Feb 21, 2000

Reliance has backward integrated further by setting up its own engineering company. The new outfit is likely to be called Reliance Engineering and Construction. Reliance Industries (RIL) is India’s largest producer of fibre intermediates (polyester terephthalate and mono–ethylene glycol) and downstream petrochemicals (polypropylene, high density polyethylene, linear low density polyethylene). Its sister company Reliance Petroleum has put in place a 27 million tonnes per annum (540,000 barrels per day) refinery which is the world’s largest grassroots refinery at Jamnagar (Gujarat). The refinery accounts for 25% of India’s refinery capacity.

The setting up of RIL’s facilities at Hazira was mostly planned within the company with subcontracting done from outside contractors. For setting up the refinery it was the Reliance engineers who worked closely with the contractor Bechtel.

The group’s in house engineering division has in the last year implemented almost the same amount of contracts as Larsen & Toubro (L & T), which got almost 70% if its Rs 74 bn revenues from its engineering division. Interestingly, the Reliance group owns 10% of L & T’s equity.

It is quite possible that with the government likely to involve the private sector in the building of infrastructure and a lot of benefits for the setting up of physical infrastructure expected in the budget, the group may have consolidated its engineering activities so that it can bid for these projects. A separate company would also enable the group to tap both the debt and the equity market for funds as and when required.

Market View:
Due to the complexity of its refinery as well as the fact that the company is poised to benefit from the impending deregulation of the Administered Pricing Mechanism, RPL has been rated as a buy by most analysts.

Reliance Industries has also been rated as a buy primarily due to the rise in petrochemical prices (tracking international prices) and its holding in blue chips such as L & T and BSES.

Equitymaster requests your view! Post a comment on "Reliance to hive off EPC division". Click here!

  

More Views on News

5 Indian Companies that are Leading the Green Hydrogen Revolution (Views On News)

Nov 2, 2021

As the green energy movement grows, Indian companies are on a mission to adopt green hydrogen, the cleanest form of energy in the world.

RELIANCE IND. Announces Quarterly Results (2QFY22); Net Profit Up 47.1% (Quarterly Result Update)

Oct 26, 2021 | Updated on Oct 26, 2021

For the quarter ended September 2021, RELIANCE IND. has posted a net profit of Rs 154 bn (up 47.1% YoY). Sales on the other hand came in at Rs 1,741 bn (up 49.8% YoY). Read on for a complete analysis of RELIANCE IND.'s quarterly results.

RELIANCE IND. 2020-21 Annual Report Analysis (Annual Result Update)

Oct 18, 2021 | Updated on Oct 18, 2021

Here's an analysis of the annual report of RELIANCE IND. for 2020-21. It includes a full income statement, balance sheet and cash flow analysis of RELIANCE IND.. Also includes updates on the valuation of RELIANCE IND..

RELIANCE IND. Announces Quarterly Results (1QFY22); Net Profit Up 7.1% (Quarterly Result Update)

Jul 26, 2021 | Updated on Jul 26, 2021

For the quarter ended June 2021, RELIANCE IND. has posted a net profit of Rs 138 bn (up 7.1% YoY). Sales on the other hand came in at Rs 1,444 bn (up 58.2% YoY). Read on for a complete analysis of RELIANCE IND.'s quarterly results.

RELIANCE IND. 2020-21 Annual Report Analysis (Annual Result Update)

Jul 8, 2021 | Updated on Jul 8, 2021

Here's an analysis of the annual report of RELIANCE IND. for 2020-21. It includes a full income statement, balance sheet and cash flow analysis of RELIANCE IND.. Also includes updates on the valuation of RELIANCE IND..

More Views on News

Most Popular

Infosys vs TCS: Which is Better? (Views On News)

Nov 26, 2021

In the post pandemic era, the top two IT companies in India are fighting to capture the growing demand for IT.

This Multibagger Stock Zooms 20% After Dolly Khanna Buys Stake (Views On News)

Nov 24, 2021

Shares of this edible oil company zoomed over 50% in three days after ace investor bought around 1% stake.

6 Popular Stocks that Turned into Penny Stocks (Views On News)

Nov 27, 2021

A look at popular stocks that crashed big time and never recovered, i.e. which went from 'Multibaggers to Multibeggers'.

How to Find Your Next 10-Bagger in this Market (Profit Hunter)

Nov 19, 2021

The #1 make or break factor in your portfolio you shouldn't ignore.

MobiKwik IPO Opens for Subscription Soon. Key Things to Know Before Subscribing. (Views On News)

Nov 20, 2021

The Rs 19 bn issue is set to hit the market soon.

More

Become A Smarter Investor
In Just 5 Minutes

Multibagger Stock Guide 2022
Get our special report Multibagger Stocks Guide (2022 Edition) Now!
We will never sell or rent your email id.
Please read our Terms

RELIANCE IND. SHARE PRICE


Dec 2, 2021 01:22 PM

TRACK RELIANCE IND.

  • Track your investment in RELIANCE IND. with Equitymaster's Portfolio Tracker. Set live price alerts, get research alerts and more. Get access now...
  • Add To MyStocks

RELIANCE IND. 8-QTR ANALYSIS

COMPARE RELIANCE IND. WITH

MARKET STATS