Credit Suisse cuts price target for RIL to Rs 853

MUMBAI: Credit Suisse has cut its price target for Reliance Industries shares to Rs 853 from Rs 907, while maintaining its outperform rating, citing a cut in its earnings per share (EPS) estimate in 2012-13 and 2013-14 as the main reason.

"We update our model for margins, rupee-dollar, lower gas volumes and new capex, resulting in FY13E/14E (estimated) EPS falling 16% and 12%, respectively," said Credit Suisse analysts Sanjay Mookim and Badrinath Srinivasan in a note to clients.

Reliance shares rose 1% to close at Rs 700.20 on Tuesday. BSE's benchmark Sensex ended marginally higher at 16,017.61.

"RIL's complex refineries were well suited to benefit from the tightness in the refining system from 2006-08 and delivered strong growth in margins. Upgrading of regional refining capacities means refining complexity is more common and RIL may not be in a position to deliver large sustained premiums to the benchmark," said the Credit Suisse analysts.