Reliance Industries Ltd. (RIL) reported that its first quarter consolidated net profit dropped 10.8% to ₹16,011 crore from ₹17,955 crore in the year-ago period on account of a 46% increase in finance cost and 31.7% rise in depreciation.
The company’s revenues at ₹2,31,132 crore was down 4.7% year-on-year (YoY) on account of a sharp decline of 31% in crude prices during the quarter ended June 30, 2023. However, a good show in the retail division and increased volume in the Oil to Chemicals (O2C) and Oil & Gas businesses partly offset the downside.
“The first quarter of FY 23 was once-in-a-generation dislocation of energy markets, which drove fuel margins to historic levels,” explained Mr. V. Srikanth, CFO, Reliance Industries Limited, when addressing media and analysts in a call following RIL’s Q1 FY24 results
The board of directors has recommended a dividend of ₹9 per share.
“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,” Mukesh D. Ambani, Chairman and Managing Director, RIL said.
Jio Platforms Ltd. reported a 12.5% growth in quarterly net profit at ₹5,098 crore. Gross revenues increased 11.3% to ₹30,640 crore. The operating revenue growth was driven by subscriber gains in the connectivity business and the scaling up of digital services.
Jio continued to lead the industry’s net subscriber addition with 9.2 million adds in Q1. ARPU increased 2.8% during the quarter.
“Jio continues to make rapid progress in rolling out its True5G network. It is on track to complete Pan-India 5G rollout before December 2023,” Akash Ambani, Chairman, Reliance Jio Infocomm Ltd. said.
Reliance Retail reported a consolidated net profit of ₹2,448 crore, a growth of 18.8% YoY. Gross revenue increased 19.5% to ₹69,948 crore.
The growth was led by the grocery, consumer electronics and Fashion & Lifestyle businesses.
“Our financial performance in the quarter has been resilient and aligned with our business goals. The sustained growth across consumption baskets has further consolidated our position as a market leader,” Isha Ambani, Executive Director, Reliance Retail Ventures Ltd. said.
RIL’s O2C business reported a 17.7% decline in revenue at ₹1,33,031 crore. Its EBITDA was down 23.2% to ₹15,271 crore. Besides a sharp drop in crude oil prices, lower price realization of downstream products impacted this business.
“The commodity business impacted the first quarter performance and it is the nature of the business and was bound to happen sometime,” Deven Choksey, MD, KRChoksey Shares & Securities Pvt. Ltd. said. “There is nothing unusual about it. But what is reassuring is the good performance of the consumer facing businesses. This will help in value unlocking,” he added.