Petrol begins to flow from RPL's refinery

Reliance Petroleum (RPL), a subsidiary of Reliance Industries, commissioned its 27-million tonne export refinery in Jamnagar on Thursday, putting to rest market speculation of a possible delay following a global demand slump for petroleum products.

The RPL refinery, which will be capable of processing 5,80,000 barrels of oil per day (bopd), has been developed in partnership with Chevron of US, which holds a 5% stake in the refinery. This is the second refinery from the Reliance stable in Jamnagar, which along with the existing 33-million metric tonne per annum (mmtpa) RIL refinery, is now the world’s largest refinery complex, with an aggregate refining capacity of 1.24 million bopd at a single location.

RIL and RPL, which would be exporting most of their products except LPG — which they sell to government-owned refineries — would be keenly watched by its rivals and analysts, as they seek to sell their products in the western markets.

Anand Jain’s firm buys 10% stake in Gokaldas Exports

Anand Jain, chairman of Jai Corp and a confidante of Reliance Industries chairman Mukesh Ambani, has picked up nearly 10% equity stake in Gokaldas Exports, a leading player in the readymade garment industry.Mr Jain’s acquisition coincides with Reliance Industries’ attempt to revive ‘Only Vimal’ and other textile brands. Reliance Industries, which started as a textile company in 1979, now earns less than 1% of its revenues from the textile business.

Blackstone had acquired a 50% stake in Gokaldas from its promoters last year. The deal was pegged at Rs 275 a share, 20% higher than the ruling market rate at that time, making it the country’s largest management buyout in the textile industry. It was followed by the mandatory open offer to shareholders which increased Blackstone’s stake to 68%.
The US-based PE giant Blackstone is the largest shareholder in Gokaldas, with a 68% holding. The Hinduja family, the original promoters of the company, now holds 20%.

RIL to sell crude at $5 discount

Reliance Industries (RIL), the country’s largest company by market capitalisation, will sell its Krishna-Godavari (KG) basin oil at a discount of around $5 per barrel to Brent crude oil, the global benchmark.At present, Brent crude oil, which is produced primarily from oil fields in the North Sea near Norway, is trading at around $100-105 per barrel.

The company, which had reported sales of Rs 41,579 crore in the first quarter of the current financial year ended June 2008, may add around $300 million (Rs 1,400 crore) to its turnover in the October-December quarter as it begins sale of the KG oil to Indian refiners.RIL will produce around 35,000 barrels of crude oil per day from the field at peak rate. This is around 5 per cent of the total crude oil produced in India. The company will initially produce around 10,000 barrels per day and increase it to peak rate in a month’s time.

As per the terms of the agreement, the government will earn profit from the sale of oil only after Reliance Industries recovers its $2 billion investment made towards producing the oil.

Read more in The Business Standard article.

Reliance abandons stake transfer of gas-rich D-6 block

Reliance Industries Ltd has abandoned a plan to transfer an 80 percent stake in a deepwater block to its subsidiaries as it has raised the money it needs for the block, the company said in a statement today.

Reliance, which owns 90 percent in the gas-rich D-6 block in the Krishna Godavari basin off east coast, said last week it had sent a proposal for the transfer of the stake to four fully-owned subsidiaries and was awaiting government approval.There were no details of the amount of funding it had raised.

Canada's Niko Resources owns the remainder in the D-6 block where huge gas discoveries have been made.Reliance aims to pump gas from D-6 from October and oil from September.

Tata Sky plans to raise up to $200 mn

Tata Sky a DTH major which is a 80:20 JV between the Tata group and television network Star is considering a second round of funding of $150-200 million and is in conversation with various private equity players such as Providence, Carlyle, Blackstone, Goldman Sachs and Apax Partners.

By law, a DTH operator in India has to be have a minimum holding of 51% by an Indian entity. Singapore-based PE player Temasek had bought about 10% for about $56 million. The valuation of the company in three months has risen more than two-fold.

Tata Sky is looking at diluting about 10% stake. The current holding structure of Tata Sky looks like this: 20% with Star (FDI), 10% with Temasek (FII) and 70% with the Tata’s. Tata Sky’s fund-raising is timed to coincide with the proposed launch of Reliance Communications and Bharti’s DTH operations. In order to face the threat from Reliance and Bharti, Tata Sky needs to ramp up in terms of infrastructure and technology.

Read more in The Economic Times article.

Related Post:
Tatas offload 10% in Tata Sky to Temasek

RIL to hive off Reliance Fresh into independent firm

A large-size restructuring is in the offing at Reliance Retail, Reliance Industries’ consumer retail project. As part of the exercise the company has decided to hive off Reliance Fresh into a separate company, Ranger Farm, for single point accountability.

A source said Reliance Fresh that sells food, fruits and vegetables and consumer products is a high-volume business which requires integration and dedicated focus, especially when opposition to organised retail in this particular category has taken political colour.

The source also said the management may knock down more verticals and spin them off into separate companies as and when they attain scale. RIL’s other formats like the hypermarket, consumer durables chain and apparel store are in their infancy with only one or two stores each. There is speculation that the number of companies that will be spun off from Reliance Retail will eventually be in double digits.

Read more in The Economic Times article.

Reliance Logistics in JV with Concor

Reliance Logistics (RLPL), an associate company of Reliance Industries, and the public sector Container Corporation of India (CONCOR) have forged a 51:49 joint venture company to provide end-to-end logistics solutions to manufacturers, traders and retailers across the country.

Christened Infinite Solutions, the new JV company will provide customised and standard container transportation by road and rail, distribution and related ancillary services. The company is planning significant investments in trucking, warehousing and material handling equipment assets.

Reliance- Indian Petrochemicals merger becomes effective

Reliance Industries on thursday said the amalgamation of Indian Petrochemicals Corporation Ltd (IPCL) with itself has come into effect from September 5.

The certified copies of the orders of the Gujarat and Bombay High Court, sanctioning the scheme of amalgamation of IPCL with Reliance Industries, were filed with the respective registrar of companies yesterday.Earlier on September 3, the Gujarat High Court approved the scheme of amalgamation of IPCL with Mukesh Ambani- controlled Reliance Industries.

In June 2002, the government as part of its disinvestment programme sold 26 per cent of its equity in IPCL to Reliance Petroinvestments Ltd (RPIL), a Reliance Group company.
RPIL acquired an additional 20 per cent equity shares through a cash offer in terms of SEBI (Takeover Regulations) and currently holds 46 per cent of the company's equity.

Read more in The Economic Times article.

Reliance buys east African oil retailer GAPCO

Reliance Industries said on Tuesday it had bought a majority stake and management control of east African oil retailer Gulf Africa Petroleum Corp (GAPCO) for an undisclosed sum.

The company said in a statement that GAPCO was a strategic acquisition which would give it access to the rapidly growing economies of east Africa, where demand for petroleum products is rising. GAPCO owned and operateed large storage terminalling facilities and a retail distribution network in countries including Tanzania, Uganda and Kenya, Reliance said. It said GAPCO had more than 250 outlets catering to retail and industrial segments.

Reliance, India's largest private company, operates a 660,000 bpd refinery in India. Reliance Petroleum Ltd, a subsidiary in which Chevron Corp holds 5 per cent, is building a 580,000 bpd unit nearby.

DLF shares rise 11%; 8th most valued firm

Shares of DLF Ltd jumped 10.85 per cent in the real estate major's second coming to the capital market, making it the eighth most valued firm on the bourses in terms of market capitalisation.

The scrip listed at Rs 582 on the Bombay Stock Exchange against the issue price of Rs 525 and soared to a high of Rs 714.25, briefly propelling the market value to over Rs 100,000 crore.

Billionaire KP Singh-promoted DLF, which had delisted from Bombay Stock Exchange in 1982, was ahead of ICICI Bank and State Bank of India in terms of market cap. Only Reliance Industries, ONGC, Bharti Airtel, NTPC, Infosys, TCS and Reliance Communications had higher market value on BSE.

In the first 15 minutes of trade, the scrip reported turnover of around Rs 330 crore as around 60 lakh shares changed hands on the BSE.The company had offered 17.5 crore equity shares through 100 per cent book-building process. The proceeds of the issue, which got oversubscribed 3.5 times, would be deployed to meet costs of construction, land acquisition and repayment of debt.

Read more in The DNA Money article.

Nifty sets fresh record; Sensex ends up 110pts

The Sensex opened marginally higher at 14,419, up 21 points. Some weakness in early trades saw the index slip into red to a low of 14,372. However, steady buying in select heavyweights helped the index rebound into positive zone.

The buying gained momentum in the latter half of the trading day and the index rallied to a high of 14,530 - up 158 points from the day's low. The Sensex finally ended with a gain of 110 points at 14,508.

The NSE Nifty rallied to a new all-time intra-day high of 4299, before settling at a record 4293 - up 36 points.

The market breadth was positive - out of 2,672 stocks traded, 1,357 advanced, 1,213 declined and 102 were unchanged today.

BHEL, Cipla lead...

BHEL and Cipla soared nearly 5% each to Rs 2,856 and Rs 219, respectively. Larsen & Toubro surged 4% to Rs 1,857.

Ranbaxy and Reliance Communications rallied over 2% each to Rs 390 and Rs 521, respectively.

Reliance and HDFC Bank advanced 1.8% each to Rs 1,755 and Rs 1,145, respectively.

SBI, Grasim, HLL, Tata Motors and Reliance Energy were up around 1% each at Rs 1,322, Rs 2,509, Rs 203, Rs 741 and Rs 555, respectively.

HDFC shed 1.7% to Rs 1,813. Gujarat Ambuja and NTPC were down 1% each at Rs 115 and Rs 161, respectively.

MOST ACTIVE COUNTERS

Orbit Corp topped the value chart with a turnover of Rs 208.40 crore followed by Unitech (Rs 150 crore), Reliance (Rs 149 crore), Advanta (Rs 129 crore) and India Infoline (Rs 122 crore

Anil ‘tells’ market mavens RIL gas ‘huge’

Last week, the single-largest individual investor in Reliance Industries, Anil Ambani, met with the Who’s Who of Dalal Street, including bulge-bracket names such as Rakesh Jhunjhunwala, Nimish Shah, Ramesh Damani, Raamdeo Agarwal and Radhakrishan Damani.

The chairman of Reliance ADAG Group had parted ways with elder brother Mukesh on “ownership issues” that eventually saw the Reliance empire being split vertically.

So it came as a surprise to the 25-odd stockmarket stalwarts present that Anil had chosen to speak like a staunch votary of RIL - even discounting his stake in the company - because of the public way the brothers had shed bad blood before reaching Splitsville.

Anil is said to have told the Dalal St experts that RIL holds far more gas than what has been already certified of 80 million cubic meters per day.

Read more in DNA Money article.

Reliance group m-cap crosses $74 bn

Total market capitalisation of the four Mukesh Ambani-controlled Reliance group companies - Reliance Industries, Reliance Petroleum, IPCL and Reliance Industrial Infrastructure — on Tuesday crossed $74 billion at $74.22 billion (Rs 3,01,341 crore) and is Rs 3,159.30 crore away from the $75 billion mark.

Two group companies, Reliance Industries (Rs 1,780) and IPCL (Rs 353.50), on Tuesday closed at their all-time highs on the Bombay Stock Exchange.

Reliance Industries, the group flagship, accounted for Rs 2,47,470 crore market capitalisation, Reliance Petroleum (Rs 42,570 crore), IPCL (Rs 10,582 crore) and Reliance Industrial Infrastructure (Rs 719 crore).

Since beginning of calendar 2007, the total market capitalisation of the group companies appreciated 40 per cent (Rs 86,459 crore) from Rs 2,14,882 crore on January 1, 2007.

Bulls reign to push Nifty above 4200

Heavy buying interest in frontline stocks propelled key indices to close in the positive. Banking stocks continued to lead the advances followed by cement stocks. Bajaj Auto plunged 9% on the demerger news and disappointing Q4 results. Tata Steel's impressive performance in the March quarter pushed the stock up 1.5%.

The BSE Sensex closed 172 points or 1.22% up at 14,299. The NSE Nifty was up 39 points or 0.92% at 4219. BSE Midcap Index was up 0.65% at 6,080 while the Smallcap Index slipped 0.01% to close at 7205.

Of a total of 2,676 shares traded on the BSE today, 1,241advanced, 1,355 declined and 80 were unchanged.

State Bank of India, up 3.47% at Rs 1,329, Reliance Industries, up 3.15% at Rs 1,685, Dr Reddy's Laboratories, up 2.21% at Rs 678 and Tata Motors, up 2.05% at Rs 750, were the major gainers on the Sensex.

Banking stocks continued to rally upward with SBI and ICICI Bank in the lead. HDFC (up 0.71%) and HDFC Bank (up 0.23%) gained on account of expectations of the merger of the two entities.

RIL to raise $2 bn via 10-year loan

Reliance Industries, the country’s largest private sector company, is raising $2 billion through a 10-year overseas syndicated loan for funding its oil and gas exploration in the D6 block of the Krishna-Godawari basin.

The D6 was among the blocks awarded to a consortium of Reliance Industries (90 per cent) and NIKO (10 per cent) under the NELP I round of bidding. Currently, the JV is developing India’s first deep water gas production facility for the Dhirubhai 1 and 3 fields, targeting the first gas in the second half of 2008.

The $2 billion syndicated loan is arranged by a consortium of 14 banks including Citigroup, ABN-Amro, Standard Chartered, HSBC, ICICI Bank and DBS. The full commitment by banks for the loan is expected to be completed this week, said industry sources.

Read more inThe Business Standard article.