File Photo of Reliance Industries logo installed on its mart in Ahmedabad.
Credit: Reuters Photo
New Delhi: Reliance Industries Limited (RIL) on Friday reported a consolidated net profit of Rs 17,265 crore for the quarter ended December 31, posting a year-on-year (YoY) growth of 9.3%, but marginally lower than the previous quarter as “inspection shutdown” and lower price realisation on its oil business hit earnings.
The company’s revenue from oil-to-chemicals business declined by 2.4% YoY to Rs 1.41 lakh crore ($17 billion) in the third quarter of the current financial year.
Oil-to-chemicals is the biggest contributor to Mukesh Ambani-led Reliance Industries Limited. Despite the decline, it accounted for nearly 57% of the company’s consolidated revenue of Rs 2.48 lakh crore (29.8 billion) recorded during the quarter under review.
RIL said, in a statement, that its revenue from oil-to-chemicals (O2C) business declined “primarily on account of lower price realisation led by 5.3% YoY decline in average Brent crude oil prices”.
It was also impacted by “lower downstream chemical margins and planned maintenance and inspection shutdown.” The crude distillation unit and fluidized catalytic cracker unit at its Jamnagar refinery saw a planned maintenance and inspection shutdown.
Oil-to-chemicals segment’s EBITDA or earnings before interest, taxes, depreciation, and amortisation, for Q3 stood at Rs 14,064 crore, which is just by around 1% higher on a YoY basis, but lower when compared with the previous quarter.
“O2C EBITDA would have been higher on YoY and comparable on QoQ (quarter-on-quarter) basis if all major units were available during the quarter,” RIL noted in the statement.
The company’s consolidated EBITDA increased by 16.7%YoY to Rs 44,678 crore in the October-December quarter helped by a strong growth in retail and telecom businesses.
Net profit of Reliance Retail Ventures Ltd increased by 32% YoY to Rs 3,165 crore during the quarter under review. The segment’s quarterly revenue surged by 22.8% YoY to Rs 83,063 crore.
Net profit of Jio Platforms, under which Reliance runs its telecom business, increased by 11.6% to Rs 5,445 crore for the quarter ended December 2023. The segment’s gross revenue jumped by 11.4% year-on-year to Rs 32,510 crore for the quarter under review.
“I am happy to share that Jio has completed in India the fastest rollout of True 5G services anywhere in the world. Every city, town, and village in the country is now equipped with high-speed digital connectivity,” said Mukesh Ambani, chairman and managing director of Reliance Industries Limited.
“The strong uptake of the JioBharat phone and JioAirFiber services has resulted in continued expansion of Jio’s subscriber base, contributing to the stellar growth numbers of the digital services business,” he added.
The company’s capital expenditure during the quarter under review stood at Rs 30,102 crore ($3.6 billion). It was mainly in 5G roll-out and expansion of retail infrastructure and new energy businesses.
Shares of RIL closed 0.01% higher at Rs 2,735.05, as compared with a 0.70% rise in the benchmark Sensex of the BSE on Friday. Financial results of the company were declared after market hours.
On RIL’s share price movement, Santosh Meena, Head of Research, Swastika Investmart, said, “Reliance has broken out of a multi-month consolidation pattern with a bullish flag formation near its 20-day moving average.”
“This technical setup suggests the potential for further upside towards the Rs 2,900 level. However, option data hints at some resistance near the Rs 2,800 strike price, as call writers seem confident at that level,” he said. On the downside, Rs 2,650 may act as a strong support level, Meena added.
RIL announced holiday for all its offices on Monday, January 22, to mark the consecration ceremony at Ram temple in Ayodhya.