Reliance Industries posts highest ever net profit of Rs 9,516 crore in Q2

Reliance Industries on Wednesday posted its highest ever net profit at Rs 9,516 crore in Q2 FY 19, up 17.35 per cent  (YoY). Mukesh Ambani-led oil-to-telecom conglomerate posted a 54.5 per cent rise in revenues to Rs 1,56,291 crore in the July-September quarter.

The company posted record quarterly EBIT for petrochemicals, retail and digital services businesses. The EBIT of retail business jumped 272.5 per cent year-on-year to a record Rs 1,244 crore. However, the refining EBIT was down 19.61 per cent year-on-year. The EBIT of Petchem segment was up 63.7 per cent on a yearly basis to Rs 8,120 crore.

Reliance Industries' telecom arm, Reliance Jio, reported standalone revenues of Rs 10,942 crore, up 51.7 per cent year-on-year. Jio logged a profit of Rs 681 crore in September quarter, up from Rs 612 crore in June quarter. The EBIT for RIL's digital business grew more than twice to 682.3 per cent.

Commenting on the Q2 results, RIL Chairman Mukesh Ambani said, "Our Company delivered robust operating and financial results for the quarter despite macro headwinds, with strong growth in earnings on Y-o-Y basis. Our integrated refining and petrochemicals business generated strong cash flows in a period of heightened volatility in commodity and currency markets."

"The financial performance of both Retail and Jio reflect the benefits of scale, technology and operational efficiencies. Retail business EBITDA has grown three fold on Y-o-Y basis whereas Reliance Jio EBITDA has grown nearly 2.5 times. Jio has now crossed 250 million subscriber milestone and continues to be the largest mobile data carrier in the world," Ambani added.

Reliance Industries said it will acquire 66 per cent stake in Den Networks for Rs 2,290 crore and 51.3 per cent in Hathway Cable for Rs 2,940 crore. The move is likely to speed up the roll out of Jio GigaFiber by bringing under its fold 27,000 local cable operators who would help strengthen its fibre-based broadband service to households for offering ultra high definition entertainment on large screen TVs.

RIL will make a "primary investment of Rs 2,045 crore through a preferential issue under SEBI regulations and secondary purchase of Rs 245 crore from the existing promoters for a 66 per cent stake in DEN", the company said in a statement. Also, it will make a primary investment of Rs 2,940 crore through a preferential issue for a 51.3 per cent stake in Hathway.

RIL would also make open offers to minority shareholders of GTPL Hathway Ltd, a company jointly controlled by Hathway with 37.3 per cent stake, and Hathway Bhawani Cabletel and Datacomm Limited, a subsidiary of Hathway.

Net subscriber addition for Jio was 37 million in July-September, as against 28.7 million in the previous quarter. The Average Revenue per User (ARPU), however, declined to Rs 131.7 per subscriber per month from Rs 134.5 in April-June.

RIL said it will make a "primary investment of Rs 2,045 crore through a preferential issue under SEBI regulations and secondary purchase of Rs 245 crore from the existing promoters for a 66 per cent stake in DEN".

Also, it will make a primary investment of Rs 2,940 crore through a preferential issue for a 51.34 per cent stake in Hathway.

RIL would also make open offers to minority shareholders of GTPL Hathway Ltd, a company jointly controlled by Hathway with 37.3 per cent stake, and Hathway Bhawani Cabletel and Datacomm Limited, a subsidiary of Hathway, the statement said.

With telecom continuing to drain investments, Reliance said its outstanding debt rose to Rs 2,58,701 crore as on September 30 as compared to Rs 2,42,116 crore on June 30 and Rs 2,18,763 crore on March 31.

Cash in hand was marginally declined to Rs 76,740 crore, from Rs 79,492 crore in the previous quarter.

The operator of world's largest oil refining complex saw pre-tax earnings from the business decline for the second quarter in a row. It fell 19.6 per cent to Rs 5,322 crore as margins dipped. In the first quarter the pre-tax earnings had fallen 16.8 per cent. The gross refining margin for the second quarter came in at $9.50 per barrel against $12 per barrel in the same period last year.

This it attributed to significantly higher crude price (up 47 per cent over last year) and tight product cracks.

The pre-tax loss of oil and gas business widened to Rs 480 crore from Rs 272 crore in the second quarter of 2017-18 due to the continued decline in production.