Reliance Industries reported a net profit of Rs 19,299 crore for the March quarter of the fiscal year 2022–23, an increase of 19 percent compared to the same period last year. The profit exceeded projections.
Revenue from operations of the most valuable company increased by 2.8% to Rs 2.13 lakh crore from Rs 2.07 lakh crore in the same quarter of the previous year.
One would anticipate a single-digit year-over-year (YoY) increase in the company’s bottom line under Mukesh Ambani’s leadership. The net profit amounted to Rs 16,573 billion.
EBITDA increased by 22 percent year-over-year (YoY) to Rs 38,440 crore due to higher revenue and margin expansion in the digital services segment, according to a company press release. The margins increased by 290 basis points to reach 18.05 percent.
EBITDA grew due to favourable mix, sourcing advantages, and operating efficiencies in the retail segment; higher transportation fuel cracks and optimised feedstock cost in the oil-to-chemical (O2C) segment; better gas price realisation and higher volumes in the oil and gas segment; and improved gas price realisation and higher volumes in the oil and gas segment.
“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.”
Profit for the quarter increased by 15.6% to reach Rs 4,984 crore. Jio Platforms, which incorporates Reliance’s telecom and streaming enterprises, increased its operational revenue by 14.4% year-over-year to Rs 25,465 crore.
Higher revenues and higher margins were the drivers of strong EBITDA growth. Revenue growth was primarily attributable to a sustained expansion of the connectivity business’ subscriber base.
Average revenue per user (ARPU), a key performance indicator for telecom companies, increased by 6.7% year-over-year to Rs 178.8 per user per month. It improved by 60 paise per user per quarter.
“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.
The increased levels of engagement among Jio users show that the consumer experience has significantly improved as a result. “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.
Reliance Retail delivered yet another quarter of strong revenue growth and profit performance. The bottom line increased by 12.9% year-over-year to Rs 2,415 crore, while the top line increased by 19.4% year-over-year to Rs 69,288 crore. The number of customers who entered a store reached a record-breaking 219 million, up from 201 million in Q3 FY23.
RIL stated that the company continued to invest in enhancing its supply chain capabilities by expanding its facility space by more than 1.7 million square feet. Digital commerce and new commerce accounted for 17% of revenue.
The revenue from O2C businesses decreased by 11.8% year-over-year to Rs 1,28,633 crore. Exports decreased by 0.4% to Rs 78,855 crore. Meanwhile, EBITDA increased by 14.4% to Rs 16,229 crore.
The EBITDA margin increased by 290 basis points year-over-year due to the strength of transportation fuel fractures, optimised feedstock costs, and advantageous ethane cracking economics. This was partially counterbalanced by declining polyester chain margins. A special additional excise duty on transport fuels had a negative impact of Rs 711 crore on earnings.
Oil & Gas
Compared to Q4FY22, oil and gas revenue more than doubled to Rs 4,556 crore, primarily due to higher price realisation and a 13 percent increase in KGD6 gas production.
EBITDA surged to Rs 3,801 crore, an increase of nearly 2.5 times year-over-year. The EBITDA margin for Q4FY23 was 83.4%, an increase of approximately 60 basis points from Q4FY22.
RIL’s media division reported a quarterly loss of 35 crore rupees. Revenue declined 8.5 percent to Rs 1,484 crore.
The growth of the TV news segment was driven by the rise in advertising revenue. Excluding the movie production segment, which is subject to project-based volatility, RIL reported a marginal increase in revenue across all verticals.
TV News reported a significant increase in EBITDA and margins from one quarter to the next. Viacom18’s investments in new initiatives (sports and digital verticals had an impact of Rs 170 crore on EBITDA) and a delay in the recovery of ad revenues led to a decline in consolidated EBITDA.