Mumbai: Reliance Industries Ltd’s (RIL) first quarter earnings are due on Friday and the street expects the company to post its highest gross refining margin (GRM) in eight years.

Standalone net profit is likely to increase to Rs8,687.5 crore on a revenue of Rs66,088 crore for the July-September quarter, according to a Bloomberg poll of seven analysts. In the year-ago quarter, the company reported a standalone net profit of Rs7,704 crore and revenue of Rs64,344 crore.

Ahead of its quarterly earnings announcement, RIL’s shares jumped nearly 4% on Thursday. The company's market valuation zoomed to its highest ever, by Rs20,328.1 crore at Rs5,52,515.10 crore.

The street awaits clarity on the following segments:

* While refining business is said to boost profit, numbers of its telecom arm Reliance Jio Infocomm are most awaited. This will be the first quarter when RIL will report Jio’s income statement. Analysts expect RIL to disclose Jio’s ARPU (average revenue per user), paying subscriber base and operating expenses. “The focus will likely be on Reliance Jio’s numbers, which should give a sense of the future viability of this business and also of RIL’s treatment of non-operating expenses, such as depreciation and interest expense," said Amit Shah of BNP Paribas in a report dated 10 October.

* Jio on Thursday unveiled a ‘Diwali Dhan Dhana Dhan’ offer, promising 100% cashback and locking in of existing tariff benefits for consumers  recharging with Rs399 between 12 and 18 October. The offer is expected to generate more competition in the telecom tariff segment. “While actual numbers will be dependent on the exact date on start of expensing, portion of cost continued to be capitalised, etc, the details of this will be keenly watched as investors expect a huge PBT (profit before tax) loss," said CLSA in a report dated 10 October. 

* Analysts expect GRMs to come in between $12.3 per barrel and $12.8 per barrel. GRM is the realization from turning every barrel of crude oil into finished products. 

* The petrochemicals segment is expected to report a mixed performance. The gains that the company has made from the commissioning of ethane imports, would be looked out for. Commissioning of its new para-xylene plant could aid volume growth. 

* On the exploration and production front, however, RIL is again likely to report losses. The company’s plan for this segment will be keenly awaited. Last week, RIL signed agreements to sell the first of its shale gas ventures—upstream Marcellus shale assets in north-eastern and central  Pennsylvania in the US—for $126 million. 

* RIL has been bullish on its retail business. It is said to be in talks with BP India to set up fuel retail outlets. Details on the company’s plan regarding the same are awaited.

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