Reliance Industries set to gain from gas reserves' outlook: Deven Choksey

In a chat with ET Now, Deven Choksey, Managing Director, KR Choksey Securities, shares his views on RIL, Excerpts:

ET Now: You track Reliance pretty closely, the stock shot up yesterday and now it seems like they are going to notify higher gas prices as well, how would you approach the stock now with the news build up around it?

Deven Choksey: In case of Reliance the positive news flow has been from the BP side, their partner. We have always been maintaining that they have a huge amount of gas reserves in KG basin and BP has reported that the company, though they have not specified the gas reserves, but we understand that they have probably around 3.6 trillion cubic feet of gas reserves in MJ1 field itself.

So from that perspective the valuation of that particular block remains on a higher side and that is where I guess the last few days the Reliance stock price has recovered significantly, of course, the short covering led rally has taken place based on the higher amount of allocation of funds and that also goes to show very clearly that FIIs allocated more funds to India which is also reflected in the rupee valuation.

To a greater extent the heavyweights like Reliance had to participate, so from that perspective I would say in near term no changes in the fundamental of the company but yes certainly the outlook of the company stands improved with the kind of discovery numbers that has been talked about or the reserves numbers that has been talked about by BP.