The Reliance stock has been trading flat for the past 12 months and is still 16 percent below its 52-week high. The diversified conglomerate is expected to announce its third-quarter earnings on January 20 and a poll conducted by CNBC-TV18 of market watchers shows that the performance may be a mixed bag.

When it comes to the oil and gas business, the street expects a sequential improvement in refining margins and domestic gas prices may offset weaker petchem margins.

Moreover, the Singapore GRM (gross refining margin) contracted further to $6.2/bbl in this period led by the decline in gasoline and diesel cracks.

Reliance Industries Limited's O2C (Oil-to-Chemicals) business is expected to see a recovery on a low base. The company's EBITDA (earnings before interest, taxes, depreciation, and amortization) is expected to increase by 12 percent quarter-over-quarter.

The refining margins are also expected to increase by 14 percent quarter-over-quarter at $16.1 per barrel. Additionally, there has been growth in middle distillate (+2 percent quarter-over-quarter) and naphtha cracks (+38 percent quarter-over-quarter). The lower windfall taxes should aid earnings in the refining segment.

The petrochemical segment of Reliance Industries Limited is expected to continue to see weakness. This is primarily due to new capacity additions in China and demand headwinds.

However, it should be noted that, according to JP Morgan, the petrochemical margins have likely bottomed in this quarter under consideration.

Jio & Retail expectation

According to street estimates, there is likely to be a slowdown in subscriber additions for the Jio segment. The company is expected to see a net subscriber addition of 6.2 million in the third quarter, compared to 7.8 million in the second. Additionally, the Average Revenue per User (ARPU) is expected to remain broadly flat, with a slight increase of 1.3 percent quarter-over-quarter at Rs 179.5.

The Retail segment is also expected to see some moderation in underlying growth. However, the revenue growth is expected to increase by 12 percent quarter-over-quarter, reaching Rs 46,610 crore.

Overall, the company's performance in the third quarter of the financial year 2023 is expected to be mixed, with growth in some segments offset by weakness in others.

What the street will monitor?

Further clarity on Rs 75000 cr announcement in the new energy business

Growth in retail store additions

Any pricing action in telecom

Also Read: Reliance Jio earnings preview | Q3 numbers set to rise on higher average revenue per user

(Edited by : Abhishek Jha)

First Published:Jan 19, 2023 7:36 AM IST