Reliance Q1 profit drops 5% to ₹15,138 crore

Net profit of Mukesh Ambani-led Reliance Industries Ltd (RIL) fell 5.5% year-on-year to ₹15,138 crore for the quarter ended June compared with ₹16,011 crore in the year-ago period.

Revenue from operations rose 12% to ₹236,217 crore in the first quarter as against ₹210,831 crore in the corresponding quarter last year.

EBITDA increased by 2% year-on-year to ₹42,748 crore. Strong contribution from Oil & Gas and consumer business offset weak O2C EBITDA which was lower by 14.3%, RIL says in a regulatory filing.

Oil and Gas segment's EBITDA increased by 29.8% on account of higher volumes from KG D6. EBITDA of Jio Platforms increased 11.6% primarily on account of healthy revenue growth and operating leverage. EBITDA for Reliance Retail Ventures Ltd increased by 10.5% led by an increase in footfalls and expansion of store footprint, streamlining of operations driving margin improvement.

“Consolidated EBITDA for the quarter improved from a year ago with strong contribution from Consumer and Upstream businesses offsetting weak O2C operating environment. Reliance’s resilient operating and financial performance in this quarter underscores the strength of its diverse portfolio of businesses,” says Mukesh D. Ambani, chairman and managing director, Reliance Industries.

"The digital services business registered an impressive financial performance year-on-year, continuing its positive growth momentum. Jio’s True 5G network, covering around 85% of India’s 5G capacity, continues to attract users, while the fixed broadband offerings are witnessing increasing consumer traction both in homes and enterprises. The attractive value proposition offered by Jio is enabling more Indians to transition to next-gen data networks," Ambani says.

Retail business delivered robust financial results, as compared to last year, well supported by all consumption baskets. "With fast-paced expansion of its retail footprint, Reliance Retail continues to cement its position as the preferred retailer for millions of Indians. The digital and new commerce segments are also scaling up rapidly. Reliance Retail is focused not only on providing quality products to customers, but also on enhancing overall customer experience, both during and after sales," Ambani says.

"The deep integration and flexibility built into our O2C business model helped mitigate the impact of challenging operating environment. The business was impacted by lower fuel cracks with tepid global demand and ramp-up of new refineries. The oil and gas segment continued its growth trajectory with higher production, offsetting lower year-on-year gas price realisations," the RIL chairman says.

Reliance says it has made significant progress on the implementation of New Energy Giga-factories. On completion, these projects will provide an integrated green energy ecosystem which can propel the next leg of sustainable growth, it says.