Accumulate RIL, target of Rs 1558: Prabhudas Lilladher

Prabhudas Lilladher has recommended an accumulate rating on Reliance Industries with a price target of Rs 1558 in its March 2009 research report.

“RIL’s two biggest projects (RPL refinery and KG D6 gas production) are going on-stream from April 2009. The earnings from these investments (over USD 13 billion) will start accruing from FY10 onwards. However, the full impact of the earnings will be witnessed only in FY11 (cash flows of over USD 7 billion). The cash flows generated out of the upcoming projects will be utilised primarily for strengthening the E&P activity. RIL has explored only a couple of blocks out of the total kitty of over 41 O&G blocks, which has good potential. However, near-term worries over subdued refining and petchem environment are likely to persist. ‘Accumulate’ with a price target of Rs 1558,” says Prabhudas Lilladher’s research report.

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