Consolidated profit after tax fell to ₹19,101 crore from ₹19,820 crore in the year earlier. Net profit attributable to owners of the company was down 4.7% to ₹16,563 crore from ₹17,394 crore a year earlier. Revenue from operations increased marginally by 0.2% to ₹2.35 lakh crore from ₹2.34 lakh crore in the year earlier.
“O2C performance impacted by unfavorable demand-supply fundamentals, leading to a sharp decline in fuel cracks and downstream margins,” RIL chief financial officer V Srikanth said on an earnings call.
The RIL stock ended at ₹2,745.20, up 0.11%, on the BSE on Monday. Sensex ended 0.73% higher. Results were announced after market hours.
“During this quarter, Reliance once again demonstrated the resilience of its diversified business portfolio. Our performance reflects robust growth in digital services and upstream business,” said RIL chairman and managing director Mukesh Ambani.
AgenciesCo Faces Unfavourable Demand-supply Balance
He added that this helped partially offset the performance of the O2C business.The O2C segment’s ebitda was down 23.7% at ₹12,413 crore from the year earlier due to the unfavourable demand-supply balance, which led to a sharp 50% decline in transportation fuel cracks and continued weakness in downstream chemical deltas. Cracking is the process by which hydrocarbons are broken down into fuels and other products.Segment revenue, however, increased by 5.1% from the year earlier due to higher volumes and increased domestic placement of products.
The oil and gas segment recorded an 11% increase in ebitda to ₹5,290 crore. The ebitda margin widened to 85%. Revenue, however, was 6% lower on account of lower price realisation, partly offset by an increase in gas and condensate volumes in the KGD6 and coal bed methane (CBM) fields. The average price realised for KGD6 gas was $9.55 per million British thermal units (mmBtu) against $10.46 per mmBtu in the September quarter of FY24.
“From a cash flow point of view, balance sheet and liquidity continue to be strong,” said Srikanth, adding that on the overall energy business side, price and margin volatility on the back of geopoli tics is a continuing theme.
TELECOM, DIGITAL
Jio Platforms Ltd (JPL), which houses RIL’s telecom and digital properties, posted a 23.4% increase in on-year net profit in the fiscal second quarter following recent tariff hikes and strong data usage growth.
JPL’s consolidated net profit climbed to ₹6,539 crore in the September quarter from ₹5,299 crore ayear earlier, and ₹5,698 crore in the preceding three-month period, it said in a statement on Monday. Profit topped the ₹6,111.33 crore average of analyst estimates compiled by ET.
The tariff hike in early July, though, has resulted in Jio reporting aloss of users due to higher prices. Its customer base stood at 478.8 million at September end against 489.7 million in the previous quarter.
Jio had taken the lead in raising tariffs by 12-25% for most of its users with an aim of shoring up average revenue per user (ARPU) in the absence of monetisation of 5G services as it has made substantial investments in buying airwaves and rolling out a pan-India 5G network.
The rate hike has boosted Jio’s ARPU sequentially but its revenue growth is likely to be staggered as the telecom market leader has more customers on longer-validity plans. ARPU increased sequentially to ₹195.1 in the fiscal se cond quarter from ₹181.7 in the previous quarter.
RETAIL
The retail business had a muted quarter. Revenue dropped 1% to ₹76,302 crore from the year earlier. Growth was impacted by weak fashion and lifestyle (F&L) demand, continued focus on streamlining of operations and a calibrated approach to the B2B business to improve margins, RIL said in a press statement.
Profit for the segment was up by a marginal 1% year-on-year at ₹2,836 crore and ebitda rose by a meagre 0.3% to ₹5,850 crore.
“The retail segment continues to increase its consumer touchpoints and product offerings across physical and digital channels,” Ambani said. “The focus on strengthening our retail operations will help us rapidly scale up this business in the coming quarters and years and sustain our industry-leading growth momentum.”