Reliance Industries to focus on emerging markets

Reliance Industries Ltd. expects more of its revenue to come from emerging according to Chief Finance Officer Alok Agarwal. “More than 60% of our exports are now going to Asia rather than U.S. and Europe,” he said. Reliance Industries operates the world’s single largest refinery complex at Jamnagar in Gujarat state, India, with a nameplate crude processing capacity of 1.24 million barrels per day (bpd). There is a glut in the market for petroleum products worldwide and global refining capacities exceed demand. However, rapid growth in Asian economies such as India and China is pushing up demand for energy. “It is pretty clear to us that demand growth is in Asia and we should plan for more than 50% of transportation fuels going to this part of the world,” Agarwal said. He said Reliance, which is now operating at full capacity, is unlikely to see any meaningful volume growth in the next few quarters. The company is looking more at margin improvement. Reliance Industries posted a 28% rise in second quarter net profit, helped by higher gross refining margins–the difference between buying crude oil and selling fuel products. (October 31, 2010)