RIL Q4 results: Net profit rises 19% to Rs 19,299 crore. Here's what Mukesh Ambani says

Reliance Industries (RIL), India's most valuable firm in terms of market capitalisation, on Friday reported a 19.10 per cent year-on-year (YoY) jump in net profit at Rs 19,299 crore for the March quarter compared with Rs 16,203 crore profit in the corresponding quarter last year. The Mukesh Ambani-led conglomerate said its revenue from operations for the quarter rose 2.12 per cent YoY to Rs 2,16,376 crore compared with Rs 2,11,887 crore in the same quarter last year.

RIL said its revenue was supported by continuing growth momentum in consumer businesses. Digital Services segment achieved 15.4 per cent  YoY growth while retail segment grew 19.4 per cent YoY. Revenue from oil & gas segment doubled YoY on account of higher price realisations. However, this was partially offset by decrease in revenue from O2C business on a on account of sharp decrease in crude oil prices and lower price realisation on downstream products, Reliance Industries said in a BSE filing.

Ebitda for the quarter jumped 21.8 per cent YoY to Rs 41,389 crore, on account of higher revenue and increase in margins in Digital Services segment. Ebitda was further lifted by favorable mix, sourcing benefits and operating efficiencies in Retail segment. Also, higher transportation fuel cracks and optimised feedstock cost was partially offset by lower downstream chemical margins in O2C segment. Add to that was better gas price realisation and higher volumes in the Oil & Gas segment, RIL said.

Operating margin for the quarter came in at 11.3 per cent against 10.4 per cent in December and 10.1 per cent in the same quarter last year. Net profit margin expanded to 8.9 per cent from 7.4 per cent in December and 7.7 per cent in the year-ago quarter.

Mukesh Ambani on segments

Chairman and Managing Director Mukesh Ambani said Retail business registered excellent growth numbers backed by expansion of physical and digital footprint and a significant increase in footfall. He said his company continued to expand product base across consumption baskets.

Ambani noted that RIL's oil to chemicals O2C segment posted its highest-ever operating profit despite global uncertainties and disruptions in commodity trade flows. "Our oil and gas segment also delivered very strong growth and is now poised to contribute nearly 30 per cent of India’s domestic gas production," he noted.

Jio Financial Services, new energy

AMbani cited RIL's proposed demerge of financial services arm and list the new entity “Jio Financial Services.

"This gives our shareholders an opportunity to participate in an exciting new growth platform from inception. Implementation of our New Energy giga factories at Jamnagar is making significant progress. This puts us on track to achieve our goals of transitioning to cleaner energy and enabling sustainable growth. I believe Reliance’s significant investments and strategic partnerships in the renewable energy vertical will help transform the energy landscape of India and the world,
in the coming years.”

Reliance Jio

RIL said Reliance Jio clocked 14.4 per cent growth in consolidated revenues at Rs 25,465 crore against Rs 22,261 crore YoY. Net profit for the quarter stood at Rs 4,984 crore, up 15.6 per cent YoY. Jio Revenue and Ebitda (Rs 12,767 crore) was highest ever for any quarter. Average revenue per user (ARPU) for the quarter came in at Rs 178.8 against analyst estimates of Rs 179. 

Retail segment

RIL said its retail segment reported a 12.9 per cent YoY rise in profit at Rs 2,415 crore for the March quarter compared with Rs 2,139 crore in the year-ago quarter. Revenue for the quarter rose 21.1 per cent YoY to Rs 61,559 crore, led by growth in Grocery, Consumer Electronics and Fashion & Lifestyle. Ebitda rose 33.1 per cent to Rs 4,769 crore, it said. 

The business maintained its store opening trajectory with 966 new store openings with an area of 6 million square feet.

The quarter recorded highest ever footfalls at 219 million across formats, RIL said adding that the business continued to invest in strengthening its supply chain capabilities by expanding over 1.7 million square feet of warehouse space. Digital commerce and new commerce businesses continued to grow and contributed to 17 per cent of revenue.

O2C, E&P segments

RIL said revenue for this segment fell 11.8 percent YoY to Rs 1,28,633 crore primarily on account of sharp reduction in crude oil prices and lower price realisation of downstream products. Ebitda for the quarter rose 14.4 per cent YoY to Rs 16,293 crore. Ebitda margin stood at 12.7 epr cent, an increase of 290 bps Y-o-Y led by strength in transportation fuel cracks, optimised feedstock cost and advantageous ethane cracking economics. This was partially offset by lower polyester chain margins. SAED on transportation fuels adversely impacted earnings by Rs 711 crore.

E&P segment

RIL said Q4 revenue for this segment more than doubled YoY mainly on account of higher price realisation and 13 per cent increase in KGD6 gas production. The average price realised for KGD6 stood at $11.39 per mmBtu against $6.13 per mmBtu in the year-ago quarter. "The average price realised for CBM is $19.57 per mmBtu vis-à-vis $7.638 per mmBtu in 4Q FY22. Ebitda increased sharply to Rs 3,801 crore which is up almost 2.5 times on YoY basis. Ebitda  margin was at 83.4 per cent for Q4FY23," RIL said.