New Delhi India's largest private sector oil and petrochemical firm, Reliance Industries Ltd posted a 10.25 per cent rise in quarterly net profit Rs 2,547 crore on Thursday, lagging forecasts due to a plant shutdown and loss of market share.
The total income increased to Rs 24,566 crore for the first quarter in 2006-07, up 36.64 per cent from Rs 17,978 crore during Q1 FY05-06, the leading petrochemical firm informed the Bombay Stock Exchange.
Gross margins on refining, which delivers 67 per cent of Reliance's revenues, were at $12.4 a barrel in the fiscal first quarter to June 30, higher than the benchmark Asian margins.
Analysts say refining margins are expected to remain strong. Its 660,000-barrel-per-day (bpd) Jamnagar refinery, in Gujarat, earns better margins than elsewhere in the region because it can use cheaper, low-grade crude to produce premium products.
"I am expecting gross refining margins to improve to $13 plus levels in the second quarter," S P Tulsian, an independent analyst said.
But the company lost market share in petrol and diesel where it competes with state-firms that have dominated fuel retailing for decades, and some units of the refinery were shut for 14 days in May for maintenance.
Shares in Reliance, which has a market value of $29.4 billion, rose 1.2 per cent to Rs 994 after the results in a firm market, where the benchmark BSE index climbed 2.7 per cent.
Reliance, which is also a top maker of polyester fibre, yarn and paraxylene, said net profit rose to $544 million in the first quarter to end-June, up from 23 billion a year ago. Turnover rose 37 per cent.
Ten analysts polled by Reuters had forecast net profit of 26.94 billion rupees and net sales of 210.75 billion rupees. Reliance shares rose 27.7 per cent in the June quarter, outperforming the benchmark BSE index's 11 per cent decline over the same period.
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