The sharp increase in revenue from the petrochemicals segment was due to higher volumes in the polyester chain and firm prices. Petrochemicals segment EBIT was at a record level of Rs 4,960 crore ($ 760 million) supported by strong volume growth, higher margins and improved product mix with ethane cracking stabilizing at Dahej and Hazira. EBIT margins during the quarter expanded to 17.7 per cent, highest in the last ten years.
During the quarter ending September 30, 2017, RIL’s polymer production was stable on y-o-y basis at 1.18 MMT. However, it was up by 21 per cent on quarter-on-quarter as there was a planned shutdown at Nagothane and Hazira in Q1 FY18.
In the polyester chain, PX markets remained stable, supported by healthy energy prices and strong downstream markets. PX-Naphtha delta narrowed ($ 343/MT, down 4 per cent Q-o-Q) due to strength in naphtha prices. PTA markets were healthy on account of robust downstream demand and tight supplies owing to planned turnarounds in the region. MEG prices firmed up during the quarter backed by robust demand, tight supplies and speculative activity.
Regional polyester demand remained healthy during the quarter amidst low inventory and healthy off-take from downstream during peak textile season. Polyester producers maintained high plant utilisation rates in order to maintain adequate inventory. Polyester filament yarn and PSF prices were firm by 11 per cent and 14 per cent respectively Q-o-Q.
During the quarter, RIL started operations of its new ROGC cracker, MEG and LLDPE plants at Jamnagar, and currently these plants are under stabilisation.
The 23.9 per cent increase in RIL’s consolidated revenue during the July-September 2017 quarter was primarily on account of increase in prices and volumes in refining, petrochemical and retail businesses. Further, the consolidated revenues reflect the commencement of commercial operations of RJIL’s Wireless Telecommunication Network during the quarter.
Exports (including deemed exports) from India refining and petrochemical operations were higher by 10.2 per cent at Rs 41,560 crore ($6.4 billion) as against Rs 37,717 crore in the corresponding period of the previous year due to higher volumes and product prices.
Commenting on the results, Mukesh D Ambani, chairman and managing director, RIL said, “Our Company reported another quarter of robust performance… The results also reflect strong underlying fundamentals of our refining and petrochemicals businesses. Sustained demand growth coupled with supply disruptions further tightened demand-supply balances globally during the quarter. The benefits of optimising our business through new projects are beginning to emerge. The structural strength in energy and materials business environment augurs well for our new capacities which are coming on-line this year.” (RKS)
Fibre2Fashion News Desk – India
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