RIL Q2 net profit jumps 43% to Rs 13,680 crore, beats estimates

Mukesh Ambani-led Reliance Industries Ltd (RIL) on Friday reported consolidated net profit of Rs 13,680 crore in the September quarter (Q2), up 43 per cent from the same period last year, on improved performance across key businesses even as finance cost fell 37 per cent on a year-on-year basis.

Consolidated revenues, PBIDT (profit before interest, depreciation, and tax), and net profit were the highest-ever since June 2013 (since consolidated is available), and also beat consensus estimates. For Reliance Jio Infocomm (Jio), too, these parameters were its highest ever. RIL’s results were announced late evening on Friday. Its shares closed 0.15 per cent up at Rs 2,627.05 on the BSE.

At 10.00 pm (IST), its GDRs (global depository receipts), which are listed on the London Stock Exchange, were up 2.7 per cent at $71.90. Each GDR represents two ordinary shares of RIL.

The consolidated top line or net revenues from operations in the period under review stood at more than Rs 1.67 trillion, up 51 per cent year-on-year (YoY), led by strong contribution from the oil to chemicals (O2C) and retail businesses.

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According to Bloomberg estimates, RIL’s net sales in Q2 were seen at Rs 1.47 trillion, Ebitda (earnings before interest, tax, depreciation and amortisation) at Rs 24,836 crore and net profit at Rs 13,063 crore.

“All our businesses reflect growth over pre-Covid levels. Our operational and financial performance reflects sharp recovery in the retail segment and sustained growth in Oil-to-Chemicals (O2C) and Digital Services business. Our O2C business benefited from sharp recovery in demand across products and higher transportation fuel margins,” Mukesh Ambani, chairman and managing director at RIL, said in a statement.

RIL’s O2C business segment contributed the highest at more than Rs 1.20 trillion to the consolidated revenues in the quarter under review.

The O2C business revenue, which benefited from higher crude oil and product prices, saw a segment revenue jump of 58 per cent YoY. It was followed by retail at Rs 45,450 crore (up 10 per cent YoY) and digital services at Rs 24,362 crore (up 7.4 per cent). All businesses saw good growth in profit, too, wherein O2C Ebitda was up 44 per cent YoY, retail’s surged 44 per cent, and digital’s was up 14.6 per cent.

“Reliance Retail continues to grow on the back of rapid expansion of both physical stores and digital offerings resulting in healthy growth in revenues and margin expansion. Jio, our digital services business, continues to transform the broadband market in India and set new benchmarks for the industry,” said Ambani.

During the quarter, Reliance Retail entered into a franchise agreement with 7-ELEVEN INC, a leading convenience global store player. The company’s quarterly consolidated Ebitda stood at Rs 30,283 crore, up 30 per cent YoY.

In the period under review, RIL’s consolidated cash profit stood at Rs 23,932 crore, up 42 per cent from last year.

In the telecom business, its customer base as on September 30, 2021, stood at 429.5 million, with a net addition of 23.8 million customers. Its ARPU, or average revenue per user, during the quarter stood at Rs 143.6 per month and the data traffic was at 23 billion GB (gigabyte), up 51 per cent.

In the retail business, all its 13,635 physical stores were operational, with 813 opened during the quarter. The area of operation stood at 37.3 million sq. feet against 29.7 million sq. feet in the corresponding quarter of the previous year, said the company.