Reliance Industries Q1 Earnings: Revenue Climbs 11.5%, Boosted by Telecom, Retail, and Oil & Gas Businesses
Reliance Industries Ltd (RIL) has showcased a robust financial performance in the fiscal’s first quarter, with a revenue increase of 11.5% reaching Rs 2.58 lakh crore compared to the same period last year. This growth is attributed to the significant contributions from its diverse business segments including telecom, retail, and oil & gas.
The company’s consolidated EBITDA (earnings before interest, taxes, depreciation, and amortization) also experienced a growth of 2 percent year-over-year, settling at Rs 42,748 crore. However, RIL witnessed a slight decline in net profit (pre-minority) by 4.5 percent, amounting to Rs 17,445 crore for the quarter ended June 30. This reduction in net profit is primarily due to increased depreciation expenses faced by the conglomerate.
In the oil and gas sector, RIL’s EBITDA saw a remarkable 30% surge, primarily fueled by higher production volume. Similarly, the operating profits of Jio Platforms Ltd and Reliance Retail Ltd observed an upward trajectory, increasing by 11.6% and 10.5% respectively, underlining the solid performance across the board.
Despite these positive trends, the Oil-to-Chemicals (O2C) segment faced some challenges, with its EBITDA decreasing by 14.3 percent from the previous year to Rs 13,093 crore. This downturn was attributed to reduced transportation fuel cracks and lower downstream chemical margins. The sequential decrease in O2C EBITDA by 22 percent was also noted, primarily due to a dip in fuel cracks amid a backdrop of subdued demand and an increase in supply, albeit cushioned by improved downstream chemical margins.
Among the fluctuations caused by energy market volatility that impacted short-term earnings, RIL remained resilient. This volatility was driven by a variety of factors including geopolitics, weather conditions, operational outages, and the introduction of new refining capacities. Yet, the underlying business dynamics of RIL stayed strong and favorable.
Jio Platforms Ltd’s performance was particularly noteworthy, with an EBITDA increase to Rs 14,638 crore. The subscriber base of Jio expanded to 489.7 million, marking a net addition of 8 million users during the quarter. Additionally, the company achieved a significant milestone of 130 million 5G users.
The oil and gas business unit of RIL also reported a positive trajectory with an EBITDA rise to Rs 5,210 crore and an EBITDA margin standing at an impressive 84.3%. A 44 percent increase in gas production from the KG D6 field, despite lower price realizations, highlighted the success of this segment. The average production at the KGD6 was at 28.7 MMSCMD of gas along with approximately 21,640 barrels per day of condensate.
RIL’s retail business continued to scale, with its EBITDA rising to ₹5,664 crore and the store area expanding beyond 80 million sq ft, showcasing the magnitude of its retail operations.
The company’s capital expenditure for the quarter was reported at Rs 28,785 crore, which was well supported by a cash profit of Rs 33,757 crore. Furthermore, RIL’s net debt reduction, from Rs 1.16 lakh crore as of March 31, 2024, to Rs 1.12 lakh crore by June 30, delineates its strong financial stewardship.
Through strategic business initiatives across its diverse segments, RIL continues to fortify its market position, navigating through market volatilities with resilience and sustained growth. The company’s financial health and ongoing investments underscore its commitment to maintaining a predominant role in India’s industrial and digital landscapes.
