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1 May 2009

Reliance Stock Recommended to be Sold Now


1. Indian stock Reliance has been downgraded to hold rating by CITI and same is attribulted by it to the fator that stock has reached its new target price of Rs 1835 and CITI had earlier revised the target.

2. Thus all those who follow global firm CITI can heed to advice related to Reliance as one can get better risk reward returns. They have considered its E&P value at Rs729, 40% premium to NAV thus factoring in meaningful reserve upside, also considered its stable refining margins (blended assumption of US$9.7-10.8 over FY10-11E), and roll fwd to Mar-10E with refinery/petrochemical business valued at 6x FY11E EV/EBITDA.

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