India’s biggest company, Reliance Industries, has reported disappointing fourth quarter earnings. Net profit climbed 14.1% to Rs5,376 crore. That number was far below analyst expectations, which hovered at around 15%.
On the bright side, RIL’s turnover beat most estimates. It grew 26% to Rs72,674 crore.
One of the factors eating into profits is the slow growth in RIL’s gross refining margins. The GRM for the quarter was $9.20 per barrel compared to $7.50 per barrel in the same period last year.
Moving on to other news, State Bank of India has hiked its lending rates by 25 basis points. Its base rate is now at 8.5%. And its new benchmark prime lending rate has gone up to 13.25%. SBI is the first bank to make loans more costly since the Reserve Bank hiked policy rates in March.
SBI is also withdrawing its so-called teaser home loan schemes following concerns from the Reserve Bank. On Wednesday chairman Pratip Chaudhuri announced his bank would launch new loans tied to the revised base rate.
Moving to the energy industry, Vedanta might need the government’s green light to acquire Cairn India, but it isn’t waiting passively. On Tuesday it bought a 10.4% stake that Malaysia’s Petronas holds in Cairn India. The deal is worth Rs6,620 crore. Vedanta subsidiary Sesa Goa made the purchase at a price of Rs331 per share. That’s a discount compared to the Rs335 per share in its ongoing open offer for 20 percent of Cairn India.
India is likely to have normal rainfall this year. On Tuesday science and technology minister Pawan Kumar Bansal announced the met department’s long-range forecast for the south-west monsoon. Rainfall in the June to September period is expected to be 98% of the long-period average. That’s with an error margin of plus or minus 5%. The long-period average for 1951 to 2000 is 89 cm.