Mumbai: Reliance Industries Ltd's second-quarter net profit for the fiscal year rose by 9.4 percent compared to the previous quarter, reaching Rs 16,563 crore, surpassing analysts' expectations, driven by strong performance in its telecom and retail divisions.
Revenue from operations for India’s largest company stood at Rs 2.35 lakh crore for the quarter ending September 30, slightly down from Rs 2.36 lakh crore in the prior quarter.
"Our performance reflects robust growth in Digital Services and Upstream business. This helped partially offset weak contribution from O2C business which was impacted by unfavorable global demand-supply dynamics," said chairman and managing director Mukesh Ambani.
RIL reported that telecom unit Jio's monthly ARPU (average revenue per user) increased by a strong 7.4 percent year-on-year to Rs 195.1.
The company noted that the full impact of the tariff hike will be seen in the next 2-3 quarters.
Jio strengthened its 5G leadership with 148 million subscribers upgrading to the faster service, which now accounts for 34 percent of Reliance Jio's wireless data traffic.
Jio Platforms, the digital services arm of Reliance Industries, posted a record quarterly profit of Rs 6,536 crore, the company reported. "Growth in Digital Services was driven by increased ARPU and improving customer engagement metrics, highlighting the strong value proposition of our services," said chairman Mukesh Ambani.
Reliance Retail Ventures recorded a profit after tax of Rs 2,935 crore for the September quarter, marking a nearly 20 percent rise from the previous quarter. The retail unit's revenue from operations increased slightly to Rs 66,502 crore, up from Rs 66,260 crore in the prior quarter.
"The retail segment continues to expand its consumer touchpoints and product offerings across both physical and digital channels. Our unique omni-channel retail model allows us to meet the diverse needs of a vast and heterogeneous customer base," Ambani stated.
Reliance Industries Ltd. (RIL) delivered strong performance across its four key verticals: Oil-to-Chemicals (O2C), Jio Platforms, Retail, and Oil & Gas.
Oil-to-Chemicals (O2C)
Revenue from RIL's O2C business grew by 5.1% to Rs 1.55 lakh crore in the September quarter, up from Rs 1.47 lakh crore a year ago. However, EBITDA for the segment dropped to Rs 12,413 crore, compared to Rs 16,277 crore in the same period last year, due to a significant decline in transportation fuel cracks and continued weakness in downstream chemical deltas.
RIL's CFO, Venkatachari Srikanth, attributed the challenges to increased product supply from Africa and reduced global oil demand, leading to volatility in crude and product prices. He added that polymer and polyester demand was down, with oil demand expected to grow less in 2024 and 2025 compared to 2023.
Despite these challenges, Srikanth expressed optimism about improved downstream margins in the O2C segment, especially with India's upcoming festival season and stimulus measures from China.
Oil & Gas Business
RIL’s Oil & Gas business reported a record quarterly EBITDA of Rs 5,290 crore, an 11% increase from the previous year. Segment revenue for the quarter stood at Rs 6,222 crore, slightly up from Rs 6,620 crore in the year-ago period. Despite lower price realization, an increase in gas and condensate volumes from the KGD6 and CBM fields helped mitigate the impact.
Jio Platforms
Jio Platforms recorded a significant 23.4% rise in net profit to Rs 6,536 crore, driven by strong subscriber growth and tariff hikes. Revenue for the segment increased 18% to Rs 31,709 crore. The average revenue per user (ARPU) climbed 7.4% year-on-year to Rs 195.1.
Jio's subscriber base reached around 479 million as of September 30, a 4.2% increase. Akash M. Ambani, Chairman of Reliance Jio Infocomm, emphasized Jio's focus on deep tech innovation, highlighting the role of Jio True5G and JioAirFiber in transforming India’s digital landscape.
JioAirFiber's rapid adoption has accelerated home connections, with 2.8 million homes connected as of September 24. Jio’s Senior VP, Anshuman Thakur, noted that the company is the fastest-growing Fixed Wireless Access provider globally, with data traffic expected to continue increasing as more subscribers switch to 5G.
Retail
Reliance Retail posted a net profit of Rs 2,935 crore, up 5.2% year-on-year and 20% quarter-on-quarter. Revenue for the retail unit rose to Rs 66,502 crore, and EBITDA grew to Rs 5,850 crore, with a margin improvement of 30 basis points to 8.8%. The company opened 464 new stores during the quarter, bringing the total to 18,946, with a total footfall of 297 million, a 14% growth y-o-y.
Reliance Retail continues to scale up its digital and new commerce channels, which now contribute 17% of total revenue. Isha M. Ambani, Executive Director of Reliance Retail Ventures, emphasized investments in technology and infrastructure to maintain market leadership and deliver innovative products.
CFO Dinesh Taluja expressed optimism for the upcoming festive season, noting strong growth in the first two weeks of October and high expectations for Diwali. Taluja also highlighted increased traction in premium formats and Jiomart’s expansion of hyper-local deliveries.
Media Business
Reliance’s media portfolio saw revenue growth of 6%, driven by increased digital segment advertising. Overall, the media business reported revenue of Rs 1,825 crore for the quarter.
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