Our Findings on Reliance Industries Ltd.
Friday, January 20, 2012
Our Findings on Reliance Industries Ltd.
Greetings From Hitesh ! Hope You are fine. Today I am going to deal with Reliance Industries Ltd. I have been very clear about this company since September 2009. I have been selling only….I have not recommended this company or bought this share till 2011.
What We Said Last on 17th June 2011?
When I wrote last on 17th June 2011….Should you Hold / Buy Reliance?….I had categorically written that “when it comes to investing my hard earned money, I have better options in the market”. Since then Reliance has come down from 960 to 687…close to 30% fall in just 7 months time. What else you want?
Current Events:-
Today it has come out with results and it has posted a net profit of Rs 4440 crore, down 13.6% year-on-year on the back of lower refining and petrochem margins. Sales, however grew 40.2% to Rs 87,480 crore.
It has also share buyback of Rs 10,440 cr at maximum price up to Rs 870/sh which is at 10% premium to today's closing price. RIL will buyback up to 12 cr shares or 3.6% equity via open-market.
Company divested 30% stake to British Petroleum. This has aided for improvement in the results in the form of the other higher income.
Company’s eastern offshore KG-D6 gas field production has fallen to a fresh low of 38.66 million cubic metres per day, as the company has shut down five wells due to water ingress.
After doing house warming ceremony of his world class building about one year back, Mr.Mukesh Ambani has yet to make his house a home.
Should You Invest Now?
I know, you want the answer of this question…..I think you should ask this question to your investment consultant, if you have one. If not, you should study yourself and find out the one for you. If you can not do either of the two, follow the media.
My Personal Call:-
From the point of view of business, I think there are better ways to invest Rs.10000 Crs. rather than buying your own shares. I would like to ask following questions….
1. Does the company lack the investment options?
2. What will happen to the price of shares after buy back is over?
3. Should I invest my money because company is buying the shares / promoters are buying shares / company is giving me bonus?
4. What happened to the shares prices of other companies when they come out with buy back?
5. If the company has cash for buying the shares….why it has recently raised USD 2 bln from the international market?
The list can go on….but I think I have given you enough food for thought.
What Next?
In just 3 weeks, the market has gone up by 10%......those who were skeptic, those who were worried for our consultancy charges, those who relied on Media Analyst that market will go down, those who were worried for Europe crisis…..all missed the early opportunities.
Message to our subscribers:-
We have started at the right time and right price, our average portfolio is up by 15% since 2nd Jan….we will make tons of money once our normal investor friends become positive and they start investing in the market. Till then relax.
Special Message to my readers:-
We are about to close our special subscription scheme…..if you still want to wait….it is your choice. But if you realize that you are missing the once in a life time opportunity…please write or call me
Live With Passion…Invest With Passion.
Hitesh Parikh.
Cell:- 98694 25399.
P/S:- Please visit our blog for previous emails.. http://bestofhiteshparikh.blogspot.com.
Our Findings on Reliance Industries Ltd.
Greetings From Hitesh ! Hope You are fine. Today I am going to deal with Reliance Industries Ltd. I have been very clear about this company since September 2009. I have been selling only….I have not recommended this company or bought this share till 2011.
What We Said Last on 17th June 2011?
When I wrote last on 17th June 2011….Should you Hold / Buy Reliance?….I had categorically written that “when it comes to investing my hard earned money, I have better options in the market”. Since then Reliance has come down from 960 to 687…close to 30% fall in just 7 months time. What else you want?
Current Events:-
Today it has come out with results and it has posted a net profit of Rs 4440 crore, down 13.6% year-on-year on the back of lower refining and petrochem margins. Sales, however grew 40.2% to Rs 87,480 crore.
It has also share buyback of Rs 10,440 cr at maximum price up to Rs 870/sh which is at 10% premium to today's closing price. RIL will buyback up to 12 cr shares or 3.6% equity via open-market.
Company divested 30% stake to British Petroleum. This has aided for improvement in the results in the form of the other higher income.
Company’s eastern offshore KG-D6 gas field production has fallen to a fresh low of 38.66 million cubic metres per day, as the company has shut down five wells due to water ingress.
After doing house warming ceremony of his world class building about one year back, Mr.Mukesh Ambani has yet to make his house a home.
Should You Invest Now?
I know, you want the answer of this question…..I think you should ask this question to your investment consultant, if you have one. If not, you should study yourself and find out the one for you. If you can not do either of the two, follow the media.
My Personal Call:-
From the point of view of business, I think there are better ways to invest Rs.10000 Crs. rather than buying your own shares. I would like to ask following questions….
1. Does the company lack the investment options?
2. What will happen to the price of shares after buy back is over?
3. Should I invest my money because company is buying the shares / promoters are buying shares / company is giving me bonus?
4. What happened to the shares prices of other companies when they come out with buy back?
5. If the company has cash for buying the shares….why it has recently raised USD 2 bln from the international market?
The list can go on….but I think I have given you enough food for thought.
What Next?
In just 3 weeks, the market has gone up by 10%......those who were skeptic, those who were worried for our consultancy charges, those who relied on Media Analyst that market will go down, those who were worried for Europe crisis…..all missed the early opportunities.
Message to our subscribers:-
We have started at the right time and right price, our average portfolio is up by 15% since 2nd Jan….we will make tons of money once our normal investor friends become positive and they start investing in the market. Till then relax.
Special Message to my readers:-
We are about to close our special subscription scheme…..if you still want to wait….it is your choice. But if you realize that you are missing the once in a life time opportunity…please write or call me
Live With Passion…Invest With Passion.
Hitesh Parikh.
Cell:- 98694 25399.
P/S:- Please visit our blog for previous emails.. http://bestofhiteshparikh.blogspot.com.
Hitesh sir ... realli its worth reading ur article .......
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