There are positives for RIL in near term: Girish Pai

In a chat with ET Now, Girish Pai, Co-Head of Institutional Equities, Centrum Broking Pvt Ltd, talks about RIL.

Japan has shut refining capacity and that is indirectly good news for refining major Reliance Industries. Sad human tragedy but good news for a refining company like Reliance.

Girish Pai: Yes it is. If you look at the refining capacity of Japan, it is close to 4.6 million barrels per day and apparently a third of that has been shut and you have in India refining capacity of 3.6 million barrels per day or thereabouts. So one third shutting down of capacity in Japan should have positive impact on gross refining margins. In fact the complex Singapore GRMs are at close to $10 and if you add the premium that one typically sees for GRMs for Reliance, as things stand right now, the GRM should be somewhere in the region of $14-15. So that is fairly positive. So I am not so very surprised by the way Reliance reacted yesterday. It was up some 2%. So fundamentally for Reliance, it is good news in the near term.