Oil Stocks Outlook for the week – 20 to 24.04.2015
( www.rupeedesk.in )
Focus
will be on the counter of Reliance Industries Ltd next week after the company
reported betterthan- expected numbers for the quarter ended March, led by
expansion in its refining margins. -The company's gross refining margins hit a
two-year high of $10.1 in Jan-Mar helping it post an all-time high net profit
of 62.43 bln rupees, up 11% on year.
Lower
fuel costs and firm gasoline, gasoil and naphtha cracks boosted GRMs, the
company said. RIL's turnover for the quarter declined 33.3% year-on-year to
708.63 bln rupees from 1.1 trln a year ago due to a sharp fall in crude oil and
product prices.
The
stock may open slightly up on Monday but most market participants are of the
view that
gains
are unlikely to sustain through the week because most of the quarterly
performance is already priced in. Also, worries remain over the company's
upstream business, which continued to witness decline in gas volumes while
crude prices remained low. Gas production from the flagship KG-D6 fell 4% to
11.3 mscmd in Jan-Mar.
The
company's continued confrontation with the government over KG-D6 and the number
of
arbitrations
will also weigh on sentiments. Shares of state-owned oil marketing companies
may continue to trade in a range since no immediate triggers are likely. Trade
will depend on news flow and movement in crude oil prices, which moved up this
week after being stable in the last few weeks.
Further
spike in oil prices could weigh on the stocks of Indian Oil Corp Ltd, Hindustan
Petroleum Corp Ltd and Bharat Petroleum Corp Ltd. However, that will be seen
positive for Oil and Natural Gas Corp Ltd and Oil India Ltd, which were the top
gainers among oil stocks this week.
Reports
that the government may exempt the two upstream companies from bearing the
subsidy on cooking gas also boosted these stocks and may keep sentiments
positive next week.
