Reliance Industries Ltd share Price

Reliance Industries (RIL) is one of India’s biggest conglomerates with a presence in oil refining & marketing and petrochemicals, oil & gas exploration, retail, digital services and media, etc, making it a well-diversified business entity.

• At the EBITDA level in FY22, O2C and oil & gas contributed 49% while retail, digital and others contributed 10%, 34% and 7%, respectively

RIL’s results were below estimates on the profitability front on account of weaker-than-expected oil-to-chemicals (O2C) earnings.

• Revenue was up 36.8% YoY to ₹ 211887 crore as all segments reported revenue growth. It grew 10.8% QoQ led by O2C and digital service
• EBITDA was at ₹ 31366 crore, up 34.3% YoY, 5.6% QoQ. EBITDA growth YoY was driven by O2C (up 24.8% YoY) and digital service (up 25.3% YoY) mainly on account of higher refining earnings in O2C coupled with tariff hike undertaken in December 2021
• Subsequently, PAT was at ₹ 16203 crore, up 22.5% YoY. PAT declined 12.6% QoQ owing to lower other income and exceptional gain of ₹ 2836 crore reported in Q3FY22

Refineries/Petro-Products company Reliance Industries announced Q1FY24 results:

• Gross Revenue was Rs 2,31,132 crore (USD 28.2 billion), down 4.7% YoY, due to a sharp decline in O2C revenues with a 31% fall in crude oil prices. However, this is partially offset by continued growth in consumer businesses and an increase in volumes from O2C and Oil & Gas business.
• EBITDA increased by 5.1% YoY to Rs 41,982 crore (USD 5.1 billion). EBITDA growth was led by consumer and upstream businesses, which offset the decline in O2C earnings. O2C earnings were lower due to a sharp fall in fuel cracks from exceptionally high levels in Q1FY23. Higher subscriber base and customer engagement led to revenue and profitability growth for Digital Services. Retail earnings reflect an expanded footprint and improved profitability with operating leverage. Higher production and realizations contributed to growth in Oil & Gas EBITDA.
• Depreciation increased by 31.7% YoY to Rs 11,775 crore (USD 1.4 billion) due to an expanded asset base across all the businesses and higher network utilization in the Digital Services business.
• Finance costs increased by 46.0% YoY to Rs 5,837 crore (USD 711 million) primarily due to higher interest rates and loan balances.
• Tax Expenses of Rs 6,112 crore (USD 745 million) in Q1FY24 were lower on account of lower deferred tax in Q1FY24.
• Profit for Q1FY24 declined by 5.9% YoY at Rs 18,258 crore (USD 2.2 billion) on account of higher finance costs and increased depreciation.
• The Capital Expenditure for Q1FY24 was Rs 39,645 crore (USD 4.8 billion).

Commenting on the results, Mukesh D. Ambani, Chairman and Managing Director, Reliance Industries said: “Reliance’s strong operating and financial performance this quarter demonstrates the resilience of our diversified portfolio of businesses that cater to demand across industrial and consumer segments.

Jio’s wide range of quality offerings at affordable price points has enabled strong growth in its subscriber base, which reflects in the financial performance of the digital services business. The accelerated roll-out of Jio’s True 5G services is propelling the nation’s digital transformation at an unprecedented pace. In another step towards democratizing the Internet in India, Jio launched the “JioBharat” Phone Platform, making Internet technology accessible and affordable to every Indian.

The retail business delivered robust growth, with fast-paced store additions and steady growth in footfalls. Digital and New Commerce initiatives contribute to scaling up, delivering value to consumers, and providing synergistic benefits to merchant partners.

O2C business delivered a resilient performance despite continuing global macro headwinds. Commencement of MJ field operations during the quarter will enhance India’s energy security, with total production from the KGD6 block rising to ~30 MMSCMD in the coming months.

The process of demerger of the financial services business – Jio Financial Services Limited – is on track with key approvals in place. I firmly believe that Jio Financial Services is uniquely positioned to foster financial inclusion in India.”

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