Reliance Industries, led by billionaire Mukesh Ambani, has reported a robust 27% year-on-year increase in net profit for the quarter ending September 30th. The company’s net profit reached ₹17,394 crore, while revenues rose 1% to ₹2.32 lakh crore. This performance exceeded expectations and was driven by all three business segments firing on all cylinders. The consumer businesses played a significant role in this success.
Operating income for Reliance Industries saw a significant jump of 30.2% to ₹44,867 crore. Despite volatility in crude prices, the Oil-to-Chemicals (O2C) business also showed signs of recovery. Finance costs remained stable, but tax expenses increased by 38.0% year-on-year. Overall, the company’s quarterly revenues were driven by strong growth in its three key verticals.
Reliance Retail, in particular, performed exceptionally well, with a sharp rise in revenues and profit. The business achieved an 18.8% year-on-year revenue growth, reaching ₹77,148 crore. Operating margin for Reliance Retail rose by 80 basis points to 8.4%, thanks to operating leverage and cost management initiatives. The food and grocery segment of Reliance Retail witnessed a remarkable 33% growth.
Reliance Jio, another segment of Reliance Industries, reported a revenue growth of 10.6% and an increase in subscriber base. The company’s EBITDA grew 12.6% to ₹13,528 crore. Commenting on the overall performance, Mukesh D Ambani, Chairman and Managing Director of RIL, expressed satisfaction with the strong contribution from all business segments.
The O2C segment faced challenges due to a decrease in crude oil prices, resulting in lower price realization for products. However, the segment’s profitability was driven by better gas price realization and a 66% growth in KGD6 gas volumes.
The company’s shares have declined by 14% since the start of the year due to weak performance in the O2C segment. However, Reliance Industries’ consumer businesses continue to contribute significantly to its overall revenues. In FY23, the company’s consolidated revenues stood at ₹9,74,864 crore, with an operating income of ₹1,53,920 crore and net profit of ₹73,670 crore.
Despite the decline in overall revenue, the strong growth in the consumer business helped offset the underperformance of the O2C segment. Reliance Industries reported consolidated revenue of ₹2.31 lakh crore for the quarter ended June, representing a 4.7% decline compared to the same period last year. However, the company’s EBITDA for Q1FY24 increased by 1.8% compared to the previous quarter.
Reliance Industries continues to demonstrate resilience in the face of global challenges. With its diverse business segments, the company is well-positioned for future growth.
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