RIL shares closed 3.4 per cent higher at Rs 889.65 (provisional) after hitting a high of Rs 893.10 earlier. The stock outperformed the BSE Oil and Gas index, which ended 2.8 per cent higher. The strong gains were accompanied by high volumes. Over 5 million RIL shares were traded on the NSE today.
Reliance is expected to report its first profit increase after four quarters of declining profits, according to consensus of analyst estimates, Thomson Reuters Starmine data showed.
Dealers say Essar results point to potentially improving refining margins at Reliance when it posts results on Friday. Essar Oil, which reported results earlier this week, swung to a net profit in the October-December quarter, with gross refining margins at a healthy $9.75 a barrel.
Reliance shares have been rising on media reports that recommendations from a government-appointed panel to look at gas pricing will be submitted to the cabinet for consideration soon. The recommendations are expected to lead to higher gas prices.
RIL has also been upgraded by multiple brokerages this week. On Thursday, Nomura increased its price target on the stock to Rs 1,000. On Monday, CLSA had raised its target price on the stock to Rs 930.
Nomura retained its "buy" rating on the stock citing an improvement in exploration and production sentiments. Petro-chemical cycle upturn and capacity expansion are getting closer, Nomura added.
Last week, Oil Minister M Veerappa Moily allowed Reliance Industries to explore for oil and gas within the producing fields subject to certain conditions. RIL had proposed to drill an exploration well on the flagging D1&D3 gas fields in the KG-D6 block to study reservoir characteristic.
The ongoing share buyback has also support RIL stock price.
(With inputs from Reuters)