Reliance is stuck in an EPS range between 62 to 68: Anish Damania

In a chat with ET Now, Anish Damania, Head-Institutional Equity, Emkay Global Financial Services shares his views on Reliance Industries:

ET Now: What is the outlook on Reliance Industries ahead of its AGM today?

Anish Damania: I do not know what is going to pan out at AGM but oil and gas as a sector in which Reliance is an important component has underperformed over the last 24 months quite significantly. If I were to look at what is happening we all know that Reliance is stuck in an EPS range between 62 to 68 and I would guess that with the diesel price parity coming on and looks more like a reality. It will have an earnings boost if they are able to sell diesel so that is one area where earnings could go up. I see that over the next two years there will be more surprises on the upside on Reliance than on a downside and given the fact that it is going to be a win-win situation if this oil subsidy burden falls for each and every company in the sector be it OMCs, be it the upstream companies or Reliance. We are of the view that the oil weightage in the index is likely to move up from the current 10% to somewhere around 12% to 12.5%.