Reliance Industries on April 21 reported net profit at Rs 19,299 crore for the March quarter of the financial year 2022-23, up 19 percent from the year-ago period. The profit beat estimates.
Revenue from operations of the most valued company came in at Rs 2.13 lakh crore, registering a rise of 2.8 percent from Rs 2.07 lakh crore in the corresponding quarter previous year.
The bottomline of the Mukesh Ambani-led company was expected to grow in single digits year-on-year (YoY). Net profit was seen at Rs 16,573 crore.
EBITDA increased by 22 percent year on year (YoY) to Rs 38,440 crore on account of higher revenue and increase in margins in digital services segment, the company said in a release. Margins improved 290 basis points to 18.05 percent.
Favorable mix, sourcing benefits and operating efficiencies in retail segment, higher transportation fuel cracks and optimised feedstock cost partially offset by lower downstream chemical margins in oil-to-chemical (O2C) segment, better gas price realization and higher volumes in the Oil & Gas segment also helped the company grow EBITDA.
“I am happy to note Reliance’s initiatives in digital connectivity and organized retail are driving greater efficiencies in the economy and contributing to India’s emergence as one of the fastest growing economies in the world,” said Mukesh D. Ambani, Chairman and Managing Director, Reliance Industries.
“This year we have proposed to demerge our financial services arm and list the new entity “Jio Financial Services Ltd. This gives our shareholders an opportunity to participate in an exciting new growth platform from inception.”
Jio Platforms
Profit for the quarter came in at Rs 4,984 crore, up 15.6 percent. Revenue from operations for Jio Platforms, which houses Reliance’s telecom and streaming businesses, increased 14.4 percent YoY to Rs 25,465 crore.
Revenue from operations increased primarily driven by sustained increase in subscriber base for the connectivity business while strong EBITDA growth was led by higher revenue and increase in margins.
Average revenue per user (ARPU), an important metric to measure the performance of telecom companies, also improved 6.7 percent YoY to Rs 178.8 per user per month. Quarter on quarter it improved by 60 paise per user.
“Jio has taken formidable strides in pioneering 5G rollout across the country with unmatched speed of execution,” said Akash M Ambani, chairman, Reliance Jio Infocomm Limited.
This has led to a significant improvement in customer experience, reflected in the higher engagement levels among Jio users. “Jio remains committed to build a robust digital society with tailormade technology platforms which will drive sustained growth in earning and value for all stakeholders,” he added.
Retail Business
Reliance Retail delivered robust performance with another quarter of strong revenue growth and profit performance. The bottom line grew by 12.9 percent YoY to Rs 2,415 crore while topline stood at Rs 69,288 crore, up 19.4 percent YoY. Store footfalls was at 219 million-highest ever, up from 201 million in Q3FY23.
RIL said the business continued to invest in strengthening its supply chain capabilities by expanding over 1.7 million sq. ft. of warehouse space. Digital Commerce and New Commerce contributed to 17 percent of revenue.
O2C
Revenue for O2C business fell by 11.8 percent YoY to Rs 1,28,633 crore. Exports dropped 0.4 percent to Rs 78,851 crore. EBITDA, meanwhile, improved 14.4 percent to Rs 16,293 crore.
EBITDA margin was at 12.7 percent, an increase of 290 bps YoY led by strength in transportation fuel cracks, optimized feedstock cost and advantageous ethane cracking economics. This was partially offset by lower polyester chain margins. Special additional excise duty on transportation fuels adversely impacted earnings by Rs 711 crore.
Oil & Gas
Oil & Gas revenue more than doubled to Rs 4,556 crore as compared to Q4FY22 mainly on account of higher price realisation and 13 percent increase in KGD6 gas production.
EBITDA increased sharply to Rs 3,801 crore which is up almost 2.5x on YoY basis. EBITDA margin was at 83.4 percent for Q4FY23 up by about 60 bps as compared to Q4FY22.
Media
RIL media business reported a loss of 35 crore for the quarter. Revenue fell 8.5 percent to Rs 1,484 crore.
TV News segment grew driven by the growth in advertising revenue. Excluding movie production segment which has project-based volatility, revenue was marginally up with growth across all verticals, RIL said.
TV News reported a sharp QoQ improvement in EBITDA and margins. Consolidated EBITDA was down primarily due to Viacom18’s investments in new initiatives (Sports and Digital verticals had an impact of Rs 170 crore on EBITDA) and a lag in recovery of ad revenues.
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