Nomura Neutral on Reliance Communications Despite Better Q2 Earnings

        0439 GMT [Dow Jones] Nomura says it is maintaining neutral on Reliance Communications Ltd.(532712.BY) with a target price of 120 rupees per piece, despite the company's better earnings for the quarter ended June. "An operationally in-line quarter" for Reliance Communications, notes the brokerage and adds that the earnings was helped by a 16% decline in interest costs compared with the previous quarter. "However, year-to-date its revenue growth trends lag behind those of its peers," says Nomura. The brokerage says the company's debt declined to 363 billion rupees, which led to interest costs falling 13% a quarter ago. The Mumbai-based company had earlier said it will reduce loans to 250 billion rupees and save about 6 billion rupees in interest costs. "This still remains key for the stock, in our view," it says. Nomura says the company's infrastructure sharing agreements with Reliance Jio Infocomm Ltd., a new telecom venture that is yet-to-start services will "offer potential operational upside, though revenue contribution is modest at this stage."(krishna.jai@wsj.com; Twitter: @jaikrishna)
        (END) Dow Jones Newswires

        November 17, 2014 23:39 ET (04:39 GMT)

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