RIL net up 6.36%, sales down 7.2%

Mumbai: Reliance Industries Ltd (RIL) has recorded a 6.36-per cent rise in net profit, enhanced by a higher other income of Rs 168 crore, to Rs 702 crore for the second quarter ended 30 September 2001. RILs net profit in the corresponding period last year was Rs 660 crore.

But the global slowdown has affected the Indian behemoth, too. Due to a seven-day inventory over normal inventory, which the company is carrying, RIL suffered a 7.2 per cent decline in sales to Rs 6,234 crore, against the Rs 6,721 crore recorded in the corresponding period last year.

RILs operating profit for the first half rose by 3 per cent to Rs 2,716 crore, against last years Rs 2,643 crore, and the earnings per share for the first half stood at Rs 12.5. The companys production, including toll conversion during the half-year, went up to 5.74 million tonnes, against the 5.26 million tonnes recorded last year, marking a 9-per cent growth.

Expectedly, RIL stood to benefit on the bourses. Its share price on the Bombay Stock Exchange was opened at Rs 252.55 and touched a high of Rs 257.85 before closing at Rs 255.4 on 31 October.

Commenting on the results, RIL managing director Anil D Ambani said: We are encouraged by Reliances strong operational and financial performance in the continuing adverse environment for the global and domestic petrochemicals industry. It is indeed satisfying that this performance has been achieved in the faces of a general economic slowdown in India and abroad, which lead to weak demand conditions in several of our major businesses.

Reliances emphasis on maintaining the highest operating rates for their plants, increased focus on specialties, continuing productivity gains, enhanced competitiveness arising from higher integration levels, and a reduction in financial costs have contributed to the consistent growth in the companys profits.

The recent extraordinary events in the global arena, and the consequent negative impact on global demand, are likely to result in an extension of the current trough phase of the petrochemicals cycle, Ambani said. We believe Reliance has the financial and operational strengths to maintain its growth through this difficult phase, and continue making investments for the future, with the objective of consistently increasing overall shareholder value.

For the nine months ending 31 December 2001, the company expects to announce its results in the last week of January 2002.