RIL share price fell 0.74 per cent to Rs 2,105.20 apiece on Friday, ahead of Q1 results. Image: Reuters RIL Q1 FY22 results HIGHLIGHTS: Mukesh Ambani-led Reliance Industries Ltd (RIL) reported Apr-Jun quarter FY22 net profit at Rs 12,273 crore, a fall of 7.25 per cent on-year. In the corresponding quarter of the previous fiscal, net profit stood at Rs 13,233 crore. RIL’s two major units Reliance Retail and Reliance Jio showed healthy topline growth with retail more than doubling net profit and telecom net profit growing by 45 per cent. The oil-to-telecom conglomerate’s revenue from operations rose 58.2 per cent to Rs 1.44 lakh crore, as compared to Rs 91,238 crore in the year-ago period. The company’s earnings before interest, taxes, depreciation, and amortization (EBITDA) grew to Rs 27,550 crore, from Rs 21,585 in the year-ago period.
“I am happy that our company has delivered robust growth despite facing a highly challenging operating environment caused by the second wave of the COVID pandemic. The results of the first quarter of FY2022 clearly demonstrate the resilience of Reliance’s diversified portfolio of businesses that cater to large parts of the consumption basket,” RIL chairman Mukesh Ambani said. He also said that COVID-related restrictions on store operations during the quarter impacted RIL’s retail business operations and profitability.
RIL share price fell 0.74 per cent to Rs 2,105.20 apiece on Friday, ahead of Q1 results. However, stock has surged nearly 12 per cent in three months and 3.7 per cent in six months. On a year-to-date (YTD) basis, it is up 7 per cent, while down a per cent from 52-week high.
Highlights
PP, PE and PVC prices strengthened during the quarter by 53%, 49% and 103% on-year respectively with higher feedstock prices and healthy global demand growth on back of economic revival in US and Europe.
RIl said that global oil supplies remained tight due to the strong compliance to production targets by OPEC plus countries during the first quarter. "Stronger oil fundamentals, vaccination programs and better demand outlook have resulted in a steady rise in crude prices throughout 1Q FY22," they added.
Oil to chemical business continues to see strong downstream margins with product deltas near or above 5-year averages.
The scheme for transfer of O2C undertaking to a wholly owned subsidiary has been filed with the National Company Law Tribunal and is pending approval. The said scheme has been approved by the creditors and shareholders of the company
Cracker operating rates remained healthy at 82%, with a strong product demand-pull. Logistics issues (Suez Canal blockage, container shortages) impacted trade flows and supported margins, Reliance Industries said.
O2C Transportation fuels volume increased from 9.3 MMT in 1Q FY21 to 9.8 MMT in 1Q FY22 with improved domestic demand.
Refinery throughput came in at 76.7 mb/d in the April-June quarter, improved by 1.5 mb/d on-quarter basis and 7.0 mb/d higher from the previous year.
On yearly basis, PX prices increased by 75% with higher crude price. PX-Naphtha delta increased to $ 244/MT, up 14% Y-o-Y and 25% Q-o-Q with firm demand and supply constraints.
"Segment EBITDA for 1QFY22 improved by 49.8% on-year to Rs 12,231 crore primarily on account of rebound in transportation fuel cracks to 4-6 quarter highs. Operational flexibility and responsiveness to market dynamics continue to play a significant role in Reliance’s O2C performance," RIL said.
Zivame delivered double digit growth over previous quarter despite supply side challenges. Orders were up 4x and new product lines of sleepwear and activewear are performing well.
Necessary approvals and trial 5G spectrum in 3GPP band n78 have been received for initiating 5G field trials. Jio 5G Standalone Network has been installed in our data centers across the country
Jio and Microsoft have operationalized an initial 10 MW capacity of Jio-Azure cloud data centers across Jamnagar and Nagpur. Onboarding of pilot customers across SMEs and start-ups is underway with further enhancement in capacity would be done in subsequent quarters.
ARPU for 1Q FY22 was Rs 138.4, with improved subscriber mix and better seasonality being offset by COVID impact.
Despite challenges for on-the-ground physical work, JioFiber now has more than 3 million connected homes with improving momentum in recent months. Engagement metrics have improved steadily across the customer base
Urban Ladder exit daily online orders grew 2.5x over last quarter. It developed an assisted sales channel through video calls and launched a multi-brand business in furnishing and décor across 40 sub-categories
JioPhone Next was unveiled during the 44th AGM of Reliance Industries, in collaboration with Google. JioPhone Next is a fully featured, ultra-affordable smartphone supporting the entire suite of applications from both Google and Jio as well as the Android Play Store. It is powered by an optimised version of the Android Operating System, that has been jointly developed by Jio and Google for the Indian market.
Reliance Industries said that its own-brand business in the retail segment continued to scale up with extension of BPL and Kelvinator portfolio and the addition of 20% more general trade counters.
Reliance Jio saw a healthy customer gross addition at 26.7 million (net addition of 14.3 million) in the quarter over the trailing quarter, driven by traction across mobility and homes.
Reliance Jio's EBITDA Margin came in at 46.9%, increased 440 bps on-year, reflecting operational efficiency.
Reliance Jio's quarterly operating revenue was at Rs 18,952 crore ($ 2.5 billion), growth of 19% adjusted for IUC, driven by continued subscriber traction in connectivity business.
With focus on building 5G infrastucture, Reliance during its quarterly briefing announced that it will create applications across education, health, entertainment and retail sectors. Reliance Jio platform is developing 5G enabled connected ambulance with Sir HN Reliance Foundation Hospital and interactive AR/VR content for students in Reliance Foundation Schools.
JioMart scaled up further to meet the needs of customers in these times. Orders were up 25% over last quarter with high repeat rates and coverage was extended to 218 cities.
RIL's digital arm, Reliance Jio, recorded total data traffic at 20.3 billion GB during the quarter; a 38.5 per cent on-year growth.
Reliance Jio reported a net addition of 14.3 million subscribers during Apr-Jun 2021. As on June 30, 2021, its customer base was at 440.6 million.
Reliance Industries said its kirana relationships were up by a third over last quarter with a significant step up in business. "Capabilities were strengthened to enhance the merchant experience and allow for rapid onboarding as markets reopen," they said.
Cash profit of the Jio Platforms stood at Rs 8,063 crore ($ 1.1 billion) in the first quarter of FY22, a growth of 31 per cent on-year
Reliance Retail said its store expansion was constrained during the quarter as the business opened 123 stores taking the total count to 12,803. However, the retail unit of RIL plans to open another 700 stores that are in the pipeline, as curbs are lifted.
"AJIO sustained its strong momentum as it scaled new highs, traffic, monthly active users and orders were up 4x over previous year. This was enabled by the impactful execution of events, wider range availability and ramping up of supply chain capacity across the network to meet the surge in business," Reliance Industries said.
Reliance Jio on Friday reported a net profit of Rs Rs 3,651 crore during the first quarter of the financial year 2021-22. The company recorded a jump of 44.9 per cent in profits for Jio platform from Rs 2,519 crore net profit reported during the first quarter of FY21. During the period, the EBITDA for Jio platforms stood at Rs 8,892 crore whereas the revenue for operations stood at Rs 18,952.
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Reliance Industries said that it will make an open offer to acquire up to 26% of Just Dial in accordance with takeover regulations. Ealrier this month, Reliance Retail Ventures Limited announced acquisition of a controlling stake in Just Dial Limited for a total consideration of Rs 3,497 crore for 40.95% stake.
Jio Platforms' net profit came in at Rs 3,651 crore ($ 491 million) in April-June quarter of the current fiscal, a growth of 44.9 per cent on-year
The Fashion and Lifestyle business, during the quarter, witnessed strong growth when compared to the previous year on better trading conditions as compared to last year. "The strong growth in Apparel & Footwear over last year was led by regional events, impactful instore activations, and compelling offers to drive conversions and ticket sizes," Reliance Industries said.
Jio Platforms' EBITDA for the quarter was Rs 8,892 crore ($ 1.2 billion) increase of 21.3 per cent on-year
"Jio has posted yet another record quarterly performance with industry-leading operating metrics. I am thankful to Jio’s family of loyal subscribers whose number has grown further during the quarter, consolidating its position as India’s No. 1 provider of digital connectivity and services. They appreciate our continuing focus on raising the bar for superior service quality," said Mukesh Ambani.
Jio Platforms' value of services for the quarter was Rs 22,267 crore ($ 3.0 billion) higher by 9.8 per cent on-year
Reliance Retail's consumer electronics recorded strong growth over last year, led by a better operating environment and higher sales of devices.
Reliance Retail's emphasis on digital commerce helped reliancedigital.in to clock best-ever quarter with record sales and uptick across consumer metrics, the company said.
"O2C maintained its market share in domestic markets. In addition, O2C continues to strategically place its products in export markets," Reliance Industries said.
Segment Revenues for the first quarter increased by 75.2% on-year to ₹ 1.03 lakh crore primarily on account of sharp increase in product prices on the back of higher Crude prices. RIL said that segment EBITDA improved by 49.8% on-year to ₹ 12,231 crore primarily on account of rebound in transportation fuel cracks to 4-6 quarter highs.
"In view of the constraints, footfalls during the quarter were at 46% of pre COVID period and were comparable to the same period last year but significantly lower than 88% footfalls in preceding quarter. Consumer sentiment has remained cautious with a hint of revival towards the end of the quarter," Reliance Industries said.