Hold Reliance Industries, target of Rs 2020: Sharekhan

"Reliance Industries Ltd (RIL)’s performance in Q1FY2010 was below our and street’s expectations mainly on account of lower-than-expected gross refining margin (GRM) and higher effective tax rate. The company disappointed the street with its GRM declining to USD 7.5 per barrel from USD 15.7 per barrel in Q1FY2009 and USD9.9 per barrel in Q4FY2009. We expect that the ramp-up of gas production from KG D- 6 basin and the stabilisation of RPL’s refinery will be the key drivers of the company’s growth in FY2010 and FY2011. However, lower-than-expected petrochem margins and delay in the ramp-up of gas production from KG D-6 field remain the key risks to our estimates and valuations."