NEW DELHI: Petrochemical major Reliance Industries share price rallied 3.4 percent intraday Friday after the company became the second largest producer of para-xylene and ahead of quarterly earnings next week.
The company announced the successful and flawless commissioning of the second and final phase of para-xylene (PX) comprising of PX crystallizers trains, trans-alkylation and aromatic extraction units at Jamnagar.
Earlier in December 2016, it had announced successful commissioning of the first phase comprising Train 1 of PX plant. Train 2 as part of second phase has been commissioned earlier this month and the last Train 3, is at an advanced stage of commissioning and will begin production later this quarter, the company said in its filing.
With the commissioning of this plant, Reliance's PX capacity will be more than double. Reliance will emerge as the world's second largest producer of PX with about 11 percent of global production.
Reliance is executing major projects in its energy and materials chain at Jamnagar covering para-xylene, cracker complex along with downstream plants and gasification.
These projects will add significant value to its refining & petrochemical business and enable Jamnagar complex to achieve energy self-sufficiency, the company said.
Reliance further said para-xylene, cracker and downstream projects as well as Gasification which is linked to DTA (domestic tariff area) refinery, have now been installed, mechanically complete and are in various stages of pre-commissioning and commissioning.
Meanwhile, the company will announce its fourth quarter earnings on April 24, which are expected be steady to strong, analysts feel.
According to them, higher petchem profitability may drive sequential operational improvement and the segment should benefit from strong cracker margins.
Gross refining margin during the quarter may be at USD 10.90 a barrel against USD 10.80 a barrel in previous quarter, according average of estimates of analysts polled by CNBC-TV18.
Details on energy project execution and updates on Reliance Jio would be key factors to watch out for in earnings that will be announced on April 24.
In March, Reliance Jio announced that it would start charging its subscribers with effect from April 2017, which means Jio will start contributing to its revenue. Hence, analysts will closely watch company's outlook for FY18.
At 11:52 hours IST, the stock price was quoting at Rs 1,415.95, up Rs 46.55, or 3.40 percent on the BSE.