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Reliance Natural Resources
RNRL - what the heck?
Posted by :
vkk43Tracked by: 0 Boarder
A nice analysis about a share must always be encouraged. Keep it up....
In reply to:
RNRL - what the heck?
Posted by :
bzeebuzz
Hello vkk43, thanks for your encouraging words
RNRL - what the heck?
Posted by : bzeebuzzTracked by: 0 Boarder
Hello vkk43, thanks for your encouraging words
...
In reply to:
RNRL - what the heck?
Posted by : vkk43
Very nicely analysed. I agree with your views.
RNRL - what the heck?
Posted by : bzeebuzzTracked by: 0 Boarder
Dear Bhattji,
Thanks for your encouraging words...
In reply to:
RNRL - what the heck?
Posted by :
bhattji
Dear Bzeebuzz, Excellant information.
RNRL - what the heck?
Posted by : GuestTracked by: 0 Boarder
xcellent analysis, some body should send this to greedy a.ambani, before he comes out with another LPO (looting public offer)...
In reply to:
RNRL - what the heck?
Posted by : bzeebuzz
This piece of info I found on the net and thought worth sharing with fellow boarders. Earlier also I posted the same message but dont know why the MMB moderator didn`t allow to published it.
I have been searching the internet for weeks to find a valuation of the gas that RNRL will be getting.
No analyst has ever bothered to publish a figure about it.
Everybody just seems to a speculating about it. No one has even bothered to calculate the valuations.
Thus I have decided to do a rough estimation.
There are lot of unresolved issues, but still no harm in doing a rough estimation.
Lets starts with the basics.
How much gas is RIL going to give?
According to initial agreement RIL has to give 28 mmscmd for 17 years.
The rate in the initial agreement was fixed at $2.34 per mmbtu.
This may go up to 40 mmscmd under certain conditions.
=================================
mmscmd is "Million Standard Cubic Meter Per Day".
mmbtu is "Million British Thermal Units".
I have explained the terms later in the post.
=================================
Now comes the first uncertainty.
RIL says it cannot supply 28 mmscmd at $2.34 per mmbtu.
This is the main dispute in the court case.
The reasons that RIL gives is
- RIL has only 4.4 trillion cubic feet (TCF) of certified proven reserves (CPR).
So how much is 4.4 TCF?
1 cubic meter = 35.3 cubic feet.
This CPR of RIL reserves = 4400/35.3 billion cubic meter.
= 4400000/35.3 million cubic meter.
= 124645 million cubic meter.
At 28 mmscmd, the reserves will last 4451 days. (12 years).
However, please not that RIL will be supplying to other companies too.
25 mmscmd will be used for RIL`s own use and 12 mmscmd is supposed to go to NTPC.
Thus if RIL has an output of 28+25+12 mmscmd = 65 mmscmd, the reserves will get exhausted in 1917 days (little over 5 years).
So if 4.4 TCF figure is correct, there is no way RIL can supply gas to RNRL for 17 years.
=================================
What is RNRL`s argument?
RNRL has stated that...
=================================
RNRL has applied for gas distribution licenses for Mumbai and NCR.
However, there is a clause in the RIL - RNRL agreement, which does not allow RNRLto use the gas bought for RIL, for any other purpose, except power generation.
I really don`t understand why markets have got excited by RNRL`s gas distribution plans. There is no way Mukesh Ambani will permit RIL`s gas to be used for gas distribution. Even if RNRL has to distribute gas, it will have buy gas from sources other than RIL.
Quote:
The court has observed that the gas supplied by RIL can only be used for power generation, which rules out the gas being used for ADAG`s city gas venture. The court has also observed that RNRL has not indicated any consumption details of the gas.
=================================
there is a very famous proverb..."don`t count your chickens before they hatch..."
I am not interested in paying a price for paper plans.
mining and oil exploration are not easy businesses.
it is not that one can start digging and start selling products from day 1.
these businesses carry a substantial risk of failure. many companies have had to abandon their alloted land/exploration blocks after not finding enough resources to sustain commercial production.
RNRL has not even got any land/exploration block.
RNRL will need lot of cash for acquiring these assets and also for setting up of its gas distribution network. where is all that cash going to come from? the company has near 0 revenues right now. this means it will either have to raise debt and dilute its equity.
I would prefer to bet on businesses with existing revenues and earnings visibility.
RNRL - what the heck?
Posted by :
r2d2c3p0Tracked by: 0 Boarder
Rakesh rated this stock RNRL as the 9th worst in a group of 10. Not the other way around. No 1 was Infy & I think No 2 was RIL. Pls check your info. ( I am a shareholder of RNRL - and was dissapointed that RJ has rated RNRL so low )...
In reply to:
RNRL - what the heck?
Posted by : bzeebuzz
Hello BN,
Glad that you like my post (FYI -the creator of the post is my mentor called Alchemist, all I have done is passed on that message to fellow boarders so that they all get benefited and can take a wise call).
I am neither the right person nor the competent one on to comment on the rationale of RJ`s investment decision and his investment philosophy. My investment mantra is very simple I invest in people rather than companies. Give your investments a reasonable amount of time and your money will come back to you with rich returns. Just see how this two brothers are fighting in public? Had there been even a slightest consideration in their heart and mind for share holders money they could have settled their score amicably, but no, each one is trying to undo other and while doing so messing up our wealth. Why to invest in castles-in-air, where in we have other companies and smart people which are far more better than this two bro`s and even attractively priced? They had a glorious past but not because of their work, but because of their father and the business environment of that time. We should keep aside the past performance and move on.
happy investing
Will it come down to Rs.12/- 2005-06 level
Posted by : bpmundraTracked by: 0 Boarder
you should wait till not reach to level Rs. 38...
In reply to:
Will it come down to Rs.12/- 2005-06 level
Posted by : Guest
I want to buy RNRL and IDFC at what rate i can buy for 6 months to 1 year holding
information to bzeebuzz
Posted by : GuestTracked by: 0 Boarder
Mukesh Ambani, CMD of Reliance Industries said that the refinery and gas production will start in H2 FY09. He also informed that Reliance will sell gas this year at USD 25 per barrel equivalent. That is at one-fifth the cost of the global price of oil.
“Gas sales which will commence this year will be at an equivalent to only USD 25.2 per barrel of crude oil as compared to a current market price of USD 135 per barrel of crude oil,” said Ambani.
He said the exports have grown at 49% compounded over last five years.He said they are pursuing greenfield investment and acquisition in polyester operations. The new refinery at Jamnagar will add nine lakh tonne per annum to polypropylene capacity, he added.
He also said thet they will remain committed to long-term potential of petroleum retail business and leverage retail opportunity via majority stake in Gulf Africa Petro. There are also eight new discoveries across four offshore basins during the year, he added.
He said the CBM block in Sohagpur has in place capacity of 3.76 tonne cubic feet. The East-West gas pipeline from KG-D6 will be completed by year-end, he added. He said there will be an expansion of deep water exploration with six additional rigs by H2 FY09. He said, " We have allotted 2 blocks in Yemen, three in Peru and have gross, contingent reserves of five billion barrel oil equivalent.The gross reserves is accretive to target 10 billion barrels of oil equivalent."
"Organised Retailing is major growth platform for Reliance. Reliance Fresh format has grown to 600 stores. The retail business will generate over five lakh new jobs over next five years. We have also received regulatory nod for SEZs in Gurgaon, Jhajjar, Jamnagar," he said talking about growth of retail business at the annual gneral meeting.
Excerpts from Mukesh Ambani’s speech at the company’s AGM:
On exports:
Reliance has maintained its leadership position as India’s largest exporter. Over the last five years, exports have grown at a compounded growth rate of 49%. Last year, It’s capital expenditure stood at Rs 19,503 crore, which is its highest till date. This huge capital expenditure spend was primarily driven by exploration and production business. This is expected to create immense value for all shareholders for years to come. India’s largest private sector refiner is one of India’s largest contributors to the national exchequer primarily by way of payments of duties and taxes.
On polyesters:
The polyester business has been the first growth platform for the company. It is also the first business in Reliance to make an overseas acquisition, i.e. Trevira in Europe. It has also been the first business in the RIL stable to become the largest in the world in its domain. It continues to build on the polyester platform. The acquisition of the assets of Malaysia’s Hualon exemplifies this direction. The company was later renamed as Recron Malaysia, which is the largest integrated textile facility globally. The acquisition has increased the polyester capacity of Reliance by 25% to 2.5 million tonne per annum. Today, Reliance is a formidable player in the polyester fibre and yarn business with a global market share of 7%. Our capacity is more than double the capacity of our nearest competitor globally.
On petroleum refining business:
The petroleum refining business is set to create history. RIL will be commissioning its new refinery at Jamnagar this year earlier than schedule. Off late, there have been many announcements about setting up new refineries in various parts of the world. They are yet to fructify. Ours is the first large refinery added in recent times to meet the global refining shortage. The new petroleum refinery at Jamnagar would add 580,000 barrels per day to global capacity. Consequently, the petroleum-refining capacity at Jamnagar would leap from 0.66 to 1.24 million barrels per day.
Almost 2% of the global petroleum refining capacity would be in one location, Jamnagar, which will be the refining capital of the world.
The refinery will earn considerable foreign exchange by exporting superior quality products to the US, Europe, and Asian markets. It will make a valuable contribution to generating employment and to the country’s economic growth. It will strongly position Jamnagar as the refining hub of the world. It will strengthen India’s position as a major supplier of high quality refined petroleum products in the world.
Four years back, RIL embarked on setting up petroleum retail outlets across the country. It garnered a 14% share of the diesel market in India in a very short time. However, as crude oil prices began to rise dramatically to record highs, the government decided to provide subsidies only to public sector petroleum retailing companies. The absence of a level playing field between private and public sector petroleum retailing companies gave rise to an unviable situation. Therefore, the company has no alternative but to suspend sales of petrol and diesel from its retail outlets, especially because of the high price environment.
However, the company remains committed to the long-term potential of the petroleum and retail business both in India and overseas. This is highlighted by the acquisition of a majority stake and management control of Gulf Africa Petroleum Corporation, which has petroleum retail networks in several African countries including Tanzania, Uganda, and Kenya. We are now strategically positioned to leverage this opportunity.
On discoveries:
During 2007-08, Reliance added a glorious chapter in its upstream oil and gas exploration and production initiative. There were eight new discoveries across four major offshore basins in India ‑- Mahanadi, Krishan Godavari, Cauvery, and Gujarat Saurashtra ‑‑ this year. We have thus proven the existence of petroleum systems in four of these major basins. Currently, we have 41 Dhirubhai discoveries to date. Our overall exploration success ratio is 63%. This is considerably higher than global averages. Oil discovery in the Cauvery basin is a significant milestone in this frontier basin, due to the extent of which our earth scientists have analyzed it.
On steps to beat talent crunch:
For sustainability, we believe that a talent pipeline fed by a supply chain of best in the class will hold us in good state. Towards this, Reliance has adopted a multi-pronged approach.
We will first nurture homegrown talent through relevant skill and competency development programmes. Second, we will recruit top talent through concentrated efforts from premier technology and management institutions. Third, we will put in place a performance oriented employee stock option plans, the largest in the country. In a collaborative effort, we are working with leading education institutions to help build more robust and industry-oriented programmes.
In all these endeavours, we have placed a trust in youth. This in turn brings vigor and dynamism to our organization. It also sets in process creating of a new generation of young Reliance leaders who can herald this into a bright future.
To hear Ambani’s complete AGM speech, watch video…
...
correct information to bzeebuzz
Posted by : GuestTracked by: 0 Boarder
think yourself Standard Cubic Meter means 1000 liters for 4.2$ nobody gives in such a rate wrong calculations and wrong information ril has 11 trillon cf reserves but proven reserves is as u said but the proven reserves are not true and about the calculations u are completely wrong as mukesh said 1 barrel equelient gas is 25.2 doller so please calculate by dividing into 4.2 dollers as u said cubic meter a day means 1 cubic meter is equal to 1000 liters and 1 cubic feet is equal to roughly around 28 liters for 1000 liters of gas no fool will give it for 4.2 dollers as u said in the past i had calculated several times and was getting the same answer as u were getting but now in the GENERAL BODY MEETING of ril i came to know that 1 barrel of equelient gas is 25.2 that he was giving so i made 25.2 is the base from there i calculated all the things so even u calculate then u will know the exact figure. i think u will do...
RNRL - what the heck?
Posted by : phkTracked by: 0 Boarder
also buy,reliance power,timex inds,tata tele,at this low price//PHK//...
In reply to:
RNRL - what the heck?
Posted by : phk
my dear bhattji, buy RNRL at present price,it will give 70%to 90% profit in 1 to 2 years,,Golden oppor,PHK
RNRL - what the heck?
Posted by : phkTracked by: 0 Boarder
my dear bhattji, buy RNRL at present price,it will give 70%to 90% profit in 1 to 2 years,,Golden oppor,PHK...
In reply to:
RNRL - what the heck?
Posted by : bhattji
Dear Bzeebuzz, Excellant information.
RNRL - what the heck?
Posted by : bhattjiTracked by: 0 Boarder
Dear Bzeebuzz, Excellant information. ...
In reply to:
RNRL - what the heck?
Posted by : bzeebuzz
This piece of info I found on the net and thought worth sharing with fellow boarders. Earlier also I posted the same message but dont know why the MMB moderator didn`t allow to published it.
I have been searching the internet for weeks to find a valuation of the gas that RNRL will be getting.
No analyst has ever bothered to publish a figure about it.
Everybody just seems to a speculating about it. No one has even bothered to calculate the valuations.
Thus I have decided to do a rough estimation.
There are lot of unresolved issues, but still no harm in doing a rough estimation.
Lets starts with the basics.
How much gas is RIL going to give?
According to initial agreement RIL has to give 28 mmscmd for 17 years.
The rate in the initial agreement was fixed at $2.34 per mmbtu.
This may go up to 40 mmscmd under certain conditions.
=================================
mmscmd is "Million Standard Cubic Meter Per Day".
mmbtu is "Million British Thermal Units".
I have explained the terms later in the post.
=================================
Now comes the first uncertainty.
RIL says it cannot supply 28 mmscmd at $2.34 per mmbtu.
This is the main dispute in the court case.
The reasons that RIL gives is
- RIL has only 4.4 trillion cubic feet (TCF) of certified proven reserves (CPR).
So how much is 4.4 TCF?
1 cubic meter = 35.3 cubic feet.
This CPR of RIL reserves = 4400/35.3 billion cubic meter.
= 4400000/35.3 million cubic meter.
= 124645 million cubic meter.
At 28 mmscmd, the reserves will last 4451 days. (12 years).
However, please not that RIL will be supplying to other companies too.
25 mmscmd will be used for RIL`s own use and 12 mmscmd is supposed to go to NTPC.
Thus if RIL has an output of 28+25+12 mmscmd = 65 mmscmd, the reserves will get exhausted in 1917 days (little over 5 years).
So if 4.4 TCF figure is correct, there is no way RIL can supply gas to RNRL for 17 years.
=================================
What is RNRL`s argument?
RNRL has stated that...
=================================
RNRL has applied for gas distribution licenses for Mumbai and NCR.
However, there is a clause in the RIL - RNRL agreement, which does not allow RNRLto use the gas bought for RIL, for any other purpose, except power generation.
I really don`t understand why markets have got excited by RNRL`s gas distribution plans. There is no way Mukesh Ambani will permit RIL`s gas to be used for gas distribution. Even if RNRL has to distribute gas, it will have buy gas from sources other than RIL.
Quote:
The court has observed that the gas supplied by RIL can only be used for power generation, which rules out the gas being used for ADAG`s city gas venture. The court has also observed that RNRL has not indicated any consumption details of the gas.
=================================
there is a very famous proverb..."don`t count your chickens before they hatch..."
I am not interested in paying a price for paper plans.
mining and oil exploration are not easy businesses.
it is not that one can start digging and start selling products from day 1.
these businesses carry a substantial risk of failure. many companies have had to abandon their alloted land/exploration blocks after not finding enough resources to sustain commercial production.
RNRL has not even got any land/exploration block.
RNRL will need lot of cash for acquiring these assets and also for setting up of its gas distribution network. where is all that cash going to come from? the company has near 0 revenues right now. this means it will either have to raise debt and dilute its equity.
I would prefer to bet on businesses with existing revenues and earnings visibility.
RNRL - what the heck?
Posted by : bhattjiTracked by: 0 Boarder
Dear Bzeebuzz, Excellant information. ...
In reply to:
RNRL - what the heck?
Posted by : bzeebuzz
This piece of info I found on the net and thought worth sharing with fellow boarders. Earlier also I posted the same message but dont know why the MMB moderator didn`t allow to published it.
I have been searching the internet for weeks to find a valuation of the gas that RNRL will be getting.
No analyst has ever bothered to publish a figure about it.
Everybody just seems to a speculating about it. No one has even bothered to calculate the valuations.
Thus I have decided to do a rough estimation.
There are lot of unresolved issues, but still no harm in doing a rough estimation.
Lets starts with the basics.
How much gas is RIL going to give?
According to initial agreement RIL has to give 28 mmscmd for 17 years.
The rate in the initial agreement was fixed at $2.34 per mmbtu.
This may go up to 40 mmscmd under certain conditions.
=================================
mmscmd is "Million Standard Cubic Meter Per Day".
mmbtu is "Million British Thermal Units".
I have explained the terms later in the post.
=================================
Now comes the first uncertainty.
RIL says it cannot supply 28 mmscmd at $2.34 per mmbtu.
This is the main dispute in the court case.
The reasons that RIL gives is
- RIL has only 4.4 trillion cubic feet (TCF) of certified proven reserves (CPR).
So how much is 4.4 TCF?
1 cubic meter = 35.3 cubic feet.
This CPR of RIL reserves = 4400/35.3 billion cubic meter.
= 4400000/35.3 million cubic meter.
= 124645 million cubic meter.
At 28 mmscmd, the reserves will last 4451 days. (12 years).
However, please not that RIL will be supplying to other companies too.
25 mmscmd will be used for RIL`s own use and 12 mmscmd is supposed to go to NTPC.
Thus if RIL has an output of 28+25+12 mmscmd = 65 mmscmd, the reserves will get exhausted in 1917 days (little over 5 years).
So if 4.4 TCF figure is correct, there is no way RIL can supply gas to RNRL for 17 years.
=================================
What is RNRL`s argument?
RNRL has stated that...
=================================
RNRL has applied for gas distribution licenses for Mumbai and NCR.
However, there is a clause in the RIL - RNRL agreement, which does not allow RNRLto use the gas bought for RIL, for any other purpose, except power generation.
I really don`t understand why markets have got excited by RNRL`s gas distribution plans. There is no way Mukesh Ambani will permit RIL`s gas to be used for gas distribution. Even if RNRL has to distribute gas, it will have buy gas from sources other than RIL.
Quote:
The court has observed that the gas supplied by RIL can only be used for power generation, which rules out the gas being used for ADAG`s city gas venture. The court has also observed that RNRL has not indicated any consumption details of the gas.
=================================
there is a very famous proverb..."don`t count your chickens before they hatch..."
I am not interested in paying a price for paper plans.
mining and oil exploration are not easy businesses.
it is not that one can start digging and start selling products from day 1.
these businesses carry a substantial risk of failure. many companies have had to abandon their alloted land/exploration blocks after not finding enough resources to sustain commercial production.
RNRL has not even got any land/exploration block.
RNRL will need lot of cash for acquiring these assets and also for setting up of its gas distribution network. where is all that cash going to come from? the company has near 0 revenues right now. this means it will either have to raise debt and dilute its equity.
I would prefer to bet on businesses with existing revenues and earnings visibility.
RNRL - what the heck?
Posted by : bhattjiTracked by: 0 Boarder
Dear Bzeebuzz, Excellant information. ...
In reply to:
RNRL - what the heck?
Posted by : bzeebuzz
This piece of info I found on the net and thought worth sharing with fellow boarders. Earlier also I posted the same message but dont know why the MMB moderator didn`t allow to published it.
I have been searching the internet for weeks to find a valuation of the gas that RNRL will be getting.
No analyst has ever bothered to publish a figure about it.
Everybody just seems to a speculating about it. No one has even bothered to calculate the valuations.
Thus I have decided to do a rough estimation.
There are lot of unresolved issues, but still no harm in doing a rough estimation.
Lets starts with the basics.
How much gas is RIL going to give?
According to initial agreement RIL has to give 28 mmscmd for 17 years.
The rate in the initial agreement was fixed at $2.34 per mmbtu.
This may go up to 40 mmscmd under certain conditions.
=================================
mmscmd is "Million Standard Cubic Meter Per Day".
mmbtu is "Million British Thermal Units".
I have explained the terms later in the post.
=================================
Now comes the first uncertainty.
RIL says it cannot supply 28 mmscmd at $2.34 per mmbtu.
This is the main dispute in the court case.
The reasons that RIL gives is
- RIL has only 4.4 trillion cubic feet (TCF) of certified proven reserves (CPR).
So how much is 4.4 TCF?
1 cubic meter = 35.3 cubic feet.
This CPR of RIL reserves = 4400/35.3 billion cubic meter.
= 4400000/35.3 million cubic meter.
= 124645 million cubic meter.
At 28 mmscmd, the reserves will last 4451 days. (12 years).
However, please not that RIL will be supplying to other companies too.
25 mmscmd will be used for RIL`s own use and 12 mmscmd is supposed to go to NTPC.
Thus if RIL has an output of 28+25+12 mmscmd = 65 mmscmd, the reserves will get exhausted in 1917 days (little over 5 years).
So if 4.4 TCF figure is correct, there is no way RIL can supply gas to RNRL for 17 years.
=================================
What is RNRL`s argument?
RNRL has stated that...
=================================
RNRL has applied for gas distribution licenses for Mumbai and NCR.
However, there is a clause in the RIL - RNRL agreement, which does not allow RNRLto use the gas bought for RIL, for any other purpose, except power generation.
I really don`t understand why markets have got excited by RNRL`s gas distribution plans. There is no way Mukesh Ambani will permit RIL`s gas to be used for gas distribution. Even if RNRL has to distribute gas, it will have buy gas from sources other than RIL.
Quote:
The court has observed that the gas supplied by RIL can only be used for power generation, which rules out the gas being used for ADAG`s city gas venture. The court has also observed that RNRL has not indicated any consumption details of the gas.
=================================
there is a very famous proverb..."don`t count your chickens before they hatch..."
I am not interested in paying a price for paper plans.
mining and oil exploration are not easy businesses.
it is not that one can start digging and start selling products from day 1.
these businesses carry a substantial risk of failure. many companies have had to abandon their alloted land/exploration blocks after not finding enough resources to sustain commercial production.
RNRL has not even got any land/exploration block.
RNRL will need lot of cash for acquiring these assets and also for setting up of its gas distribution network. where is all that cash going to come from? the company has near 0 revenues right now. this means it will either have to raise debt and dilute its equity.
I would prefer to bet on businesses with existing revenues and earnings visibility.
Nothing wrong in buying Rnrl on falls....
Posted by : marketmanTracked by: 0 Boarder
Fiis do not have much exposure to this stock,even few fiis sell this,the domestic retail investors will be absorbing the stock in coming days.... so,not much panic will be seen in the counter... the small investors who have their own spare cash can be put in this counter for long term strategy......
Will it come down to Rs.12/- 2005-06 level
Posted by : avrochanTracked by: 0 Boarder
That I know it will cross 500 Rs. in two years time, as RPL and RNRL are the 2 blue chips in Indian story. I am looking forward to the price below Rs.20 for accummulation. These are prices on paper. RPL too no earning started, and if the Chevron offload 5%, I think there could be a free fall of RPL to 70 levels from there, we can make a buy. At the moment no need to trust any script due to reason liquidity conditions. What is happening now is like an earth quake the foreign investors are selling and prices are falling. I am more suspicious about Chevron offloading their 5% whereby RPL could see a steep fall. These people now in U.S are in dire need of funds. Check Karuturi Global another powerful stock, in a week`s time, foreign investors took away their money and Indian public ko chuna lagaya. From 23 Rs. to 9 Rs. RNRL is a stock moved from 20 levels to 250 - I have no trust in this stock, and probably we will see the same price soon....
In reply to:
Will it come down to Rs.12/- 2005-06 level
Posted by : bpmundra
In short run it may go further down to 38 but at last RNRL will cross Rs. 250 (Within 3 months)
bpmundra
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