How Reliance Q3 earnings affected its share price?

Shares of billionaire Mukesh Ambani-led Reliance Industries (RIL) were trading higher on Monday as investors cheered its December quarter earnings report, which beat market expectations. The oil-to-telecom conglomerate has declared positive results for the last four consecutive quarters.

Boosted by strong Q3 earnings, the share price of RIL gained as much as 1% in the first hour of the day’s trade. RIL shares opened flat at ₹2,478.10 and rose more than 1% to hit a high of ₹2,504.10 on the BSE. There was spurt in volume trade as 1.47 lakh shares worth ₹36.54 crore changed hands over the counter in early trade, while market capitalisation surged to ₹16.63 lakh crore.

At the time of reporting, RIL shares were trading down by 1.1% at ₹2,450.80 apiece on the BSE, paring opening gains. The stock declined in line with broader market, which traded lower following weak cues from global peers. The BSE Sensex was trading lower by 683 points, or 1.16%, at 58,354 by 11 AM IST.

The stock was trading at a discount compared to its average historical valuations, albeit it was higher than 20-day, 50-day, and 200-day moving averages. RIL share price hit a 52-week high of ₹2,750 on October 19, 2021, and 52-week low of ₹1,830 on January 29, 2021.

The largecap stock has gained 20% returns over the last one year, while it climbed 18% in the last six months. The RIL shares rose nearly 4% in the past one month, while it dropped 3.4% over the past one week.

The country’s most valued firm by market capitalisation on Friday reported 37.9% growth in consolidated net profit to ₹20,539 crore for the quarter ended December 31, 2021, compared with ₹14,894 crore in the year-ago period. The oil-to-telecom conglomerate notched a 52.2% rise in revenue to ₹2,09,823 crore in Q3FY22, as against ₹1,37,829 crore in the corresponding quarter of FY21. Earnings before interest, taxes, depreciation and amortisation (EBITDA) surged 29.9% to ₹33,886 crore from ₹26,094 crore in the same period last year.

For the first nine months of this financial year, the company recorded ₹49,824 crore profit, while it spent ₹1.13 lakh crore as capital expenditure, which include ₹43,589 crore paid towards acquisition of spectrum by Reliance Jio Infocom Ltd.

The surge in top and bottom line growth was attributed to higher volumes and improved price realisation on the back of increase in crude oil prices. Its net profit includes an exceptional gain of ₹2,872 crore as the company divested all its shale gas assets.

Commenting on Q3 earnings, Mukesh Ambani, chairman and managing director at RIL, said the two consumer businesses -- retail and digital services -- have recorded highest ever revenues and EBITDA. "During this quarter, we continued to focus on strategic investments and partnerships across our businesses to drive future growth," he added.