Reliance Industries Q2 Results: RIL Beats Estimates Despite Consolidated PAT Falls 5% YoY To Rs 16,563 Crore

Indi's largest company, Reliance Industries beats estimates in the second quarter of FY25, despite reporting decline in its net profit on year-on-year basis. In Q2FY25, consolidated net profit attributed to the owners of the company, at Rs 16,563 crore, declining by 4.8% from its PAT of Rs 17,394 crore in the same quarter a year ago.

The bottom-line front took a hit on a YoY basis after Reliance's Q2C EBITDA declined sharply by 23.7% YoY owing to weak product margins. The retail business saw a slight improvement, while the EBITDA of telecom and oil & gas business was healthy.

Reliance's Q2PAT is higher compared to net profit of Rs 15,138 crore in Q1FY25.

Also, Profit After Tax and Share of Profit/(Loss) of Associates & JVs decreased 3.6% Y-o-Y to Rs 19,323 crore, compared to PAT of Rs 19,820 crore in Q2FY24.

Gross revenue witnessed a gradual upside of 0.8% YoY to Rs 258,027 crore in Q2FY25, compared to Rs 255,996 crore in Q2FY24. As per Reliance, on the top-line front, oil-to-chemicals (O2C) revenue improved with higher volumes and increased domestic placement of products.

Meanwhile, the digital services revenue increased with the impact of revised telecom tariffs for mobility services and the scale-up of homes and digital services businesses. However, lower gas price realizations led to 6% lower revenue in the Oil and Gas segment.

During the quarter under review, EBITDA stood at Rs 43,934 crore, down by 2% YoY. Also, EBITDA margins contracted by 50 bps to 17% in Q2 of FY25 as against 17.5% in the same quarter a year ago. EBITDA was marginally up from Rs 42,748 crore in Q1FY25.

Under the operating profit of Reliance, the EBITDA of Jio Platforms Limited (JPL) increased 17.8% Y-o-Y due to a better subscriber mix, digital services scale-up and revision in telecom tariffs. This was on expected lines.

Also, the EBITDA margin for Reliance Retail Ventures Limited (RRVL) improved by 30 bps with a continued focus on streamlining operations and a calibrated approach in B2B. The oil and gas segment EBITDA increased by 11.0% on account of sustained volume growth and one time provisioning towards decommissioning cost for Tapti field in Q2 FY 24.

But Reliance's key business O2C EBITDA was lower by 23.7% on account of sharp decline in product margins. In its financial report, Reliance stated that fuel cracks declined by nearly 50% Y-o-Y. Downstream chemicals also declined with muted global demand in a well-supplied market. RIL benefited due to superior ethane cracking economics driven by a sharp fall in ethane prices.

On the results, Mukesh D. Ambani, Chairman and Managing Director, Reliance Industries Limited said, "I am happy to note that 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. This helped partially offset weak contribution from O2C business which was impacted by unfavorable global demand-supply dynamics."

Further, Ambani added, "The first of our New Energy Giga-factories is on-track to commence production of solar PV modules by the end of this year. With a comprehensive range of renewable solutions including solar, energy storage systems, green hydrogen, bio-energy and wind, the New Energy business is poised to become a significant contributor to global clean energy transition."

In Q2FY25, Reliance's net debt reduced YoY to Rs 116,438 crore, compared to Rs 117,727 crore in Q2FY24, however, sharply shot up from debt of Rs 112,341 crore in Q1FY25.

On BSE, Reliance Industries share price stood at Rs 2745.20 apiece, marginally up with market cap of Rs 18,57,423.78 crore.