RIL Q2 Results: Reliance Posts Whopping Growth Of 30% In Net Profit To Rs 19,878 Crore; EBITDA Up 30.2%

RIL Q2 Results: Mukesh Ambani-owned Diversified conglomerate Reliance Industries (RIL) on Friday reported a robust growth in net profit for the quarter ending September 30, 2023. After a subdued performance in the April-June quarter, Reliance today clocked a double-digit growth of almost 30% in Q2 net profit at Rs 19,878 crore; while the company's gross Revenue stood at Rs 255,996 crore. RIL's Capital Expenditure for the quarter was Rs 38,815 crore ($4.7 billion) with continuing accelerated investments in pan-India 5G roll-out.

RIL's net profit margin in Q2FY24 was 7.8%, compared to 7.9% in the prior quarter.

During this period the company's outstanding debt came down to Rs 295,687 compared to Rs 318,685 in Q1FY24. 2QFY24 EBITDA was seen at Rs 44,867 crore, higher than Rs 41,982 crore in Q1FY24.

The company's Gross Revenue during the quarter stood at Rs 255,996 crore ($ 30.8 billion), up 1.2% Y-o-Y, supported by continuing growth momentum in consumer businesses.

According to the results, RIL's Revenue from Oil & Gas segment increased significantly with incremental production of gas and condensate from MJ field. O2C revenue declined with a 14% decrease in crude oil prices leading to lower price realization for products

1. Oil to Chemicals (O2C) Business

• O2C revenue declined with a 14% decrease in crude oil prices leading to lower price realization for products.
• Segment Revenue for 2Q FY24 fell 7.3% Y-o-Y to Rs 147,988 crore ($ 17.8 billion) primarily on account of a sharp 14% reduction in crude oil prices, resulting in lower price realization for products.
• Segment EBITDA for 2Q FY24 was higher by 36.0 % Y-o-Y at Rs 16,281 crore ($ 2.0 billion) with strength in gasoline and
• PVC margins, optimized feedstock sourcing and lower SAED in-line with decline in middle-distillate cracks. Downstream contribution remained weak with lower PE, PP, and polyester chain deltas.
• Global oil demand in 2Q FY24 rose 2.5 mb/d Y-o-Y to 102.7 mb/d, with strong demand mainly from China and India. Jet/Kero and gasoline posted robust demand growth Y-o-Y at ~1 mb/d and ~0.7 mb/d respectively, while diesel demand saw relatively lower growth of ~0.2 mb/d.
• Crude oil benchmarks declined Y-o-Y due to macroeconomic headwinds on high-interest rates, lower industrial activities, and sentiments shifting from risk premium to fundamentals. Continued Russian oil supply despite EU ban pressured prices. Dated Brent averaged $86.8 /bbl in 2Q FY24, lower by $14.1 /bbl Y-o-Y.
• Domestic polymer and polyester demand during 2Q FY24 improved by 25% and 12% Y-o-Y respectively with channel restocking on attractive prices and continuing demand from infrastructure projects, pipes, and packaging sector.

2. Reliance Retail

• Reliance Retail delivered a strong performance with Gross Revenue recorded at Rs 77,148 crore for 2Q FY24, a growth of 18.8% Y-o-Y led by well-rounded growth across consumption baskets.
• Grocery Fashion & Lifestyle businesses maintained strong growth momentum while Consumer Electronics had a steady performance despite the festive period falling in 3Q FY24.
• The business posted an EBITDA of Rs 5,820 crore which was up by 32.2% on a Y-o-Y basis. EBITDA before Investment Income was recorded at Rs 5,607 crore.
• EBITDA margin from operations on net sales was at 8.1%, up 70 bps Y-o-Y driven by operating leverage and continued focus on cost management.
• The business expanded its store network with 471 new store openings taking the total store count at the end of the quarter to 18,650 stores with an area of 71.5 million sq ft.
• The quarter recorded footfalls of over 260 million across formats, a growth of 40.5% Y-o-Y.

During the quarter, Reliance Retail acquired Ed-a-Mamma, a kids and maternity-wear brand and majority ownership of Superdry IP for India, Sri Lanka, and Bangladesh.

3. Telecom business

On the telecom front, Reliance Jio Infocomm today reported a 12.10% year-on-year (YoY) growth in standalone net profit at Rs 5,058 crore for the second quarter. On a quarterly basis, the growth in net profit was 4%. The telco's revenue from operations stood at Rs 24,750 crore, up 9.89% year-on-year. Sequentially, it rose 2.94% from Rs 24,042 crore in the previous quarter, said the telecom in a release.

4. Oil and gas

• RIL's Revenue from Oil & Gas segment increased significantly with incremental production of gas and condensate from MJ field.
• 2Q FY24 Revenue rose 71.8% as compared to 2Q FY23 mainly on account of higher production of Gas & Oil and commencement of Condensate production from MJ field along with 6% higher gas price realization in KG D6.
• EBITDA increased to Rs 4,766 crore which is up by 50.3% on Y-o-Y basis. EBITDA margin was at 72% for 2Q FY24.
• Margins were compressed during the quarter due to higher costs related to the commissioning and ramp-up of MJ field and decommissioning activities at Tapti field.
• Domestic demand for transportation fuels remained healthy with continuing strong momentum in automobile sales and air passenger traffic. Demand for HSD, MS & ATF increased by 4.3%, 5.7% and 13.5% respectively over the same quarter last year.

5. Jio Platform Limited

• Quarterly revenue at Rs 31,537 crore, up 10.6% Y-o-Y
• Quarterly EBITDA at Rs 13,528 crore, up 12.6% Y-o-Y
• Net subscriber addition accelearing to over 11 million during the quarter.
• ARPU increased 2.5% Y-o-Y to Rs 181.7 driven by better subscriber mix across mobility and wireline partially offset by start of 5G services.
• Strong subscriber growth across mobility and wireline services and scale up of digital services platform drove JPL consolidated revenue and EBITDA growth.

Jio Platforms, in collaboration with NVIDIA, will build state-of-the-art cloud-based Artificial Intelligence (AI) infrastructure in India. This infrastructure will enable accelerated computing and high-speed secure cloud networking to run workloads safely and with extreme energy efficiency. NVIDIA will provide CPU, GPU, networking, and AI operating systems for building the most advanced AI models while Jio will manage and maintain the AI cloud infrastructure and oversee customer engagement and access.

Commenting on the results, Mukesh D. Ambani, Chairman and Managing Director, Reliance Industries Limited said: "Strong operational and financial contribution from all business segments has helped Reliance deliver another quarter of robust growth." "Resilient performance of the O2C segment despite volatility in energy markets was led by strong growth in fuel demand in a supply-constrained market. Weak global demand and supply overhang continued to impact downstream margins. The growth of oil and gas business is particularly noteworthy with production from KGD6 block ramping up and providing valuable fuel for the energy transition to the Indian economy," he added.

Performance of Reliance Industries in the first quarter:

The Mukesh Ambani-led company posted a YoY decline of 11% in the consolidated net profit for the quarter ended June 2023 to Rs 16,011 crore. The company's consolidated revenue dropped 5.3% YoY to Rs 2.11 lakh crore. The board had recommended a dividend payout of Rs 9 per share, subject to the approval of the shareholders.

Reliance Industries Shareholders Approve the Appointment of Isha, Akash And Anant Ambani As Non-Executive Directors

Reliance Industries Limited informed via an exchange filing on Friday that the resolutions for the appointment of Isha Ambani, Akash Ambani, and Anant Ambani as the company's non-executive directors have been approved by its shareholders. The company said, "The said resolutions have been passed with more than requisite majority on October 26, 2023 (the last date of e-voting). "

Of the total votes polled, Isha Ambani, Akash Ambani, and Anant Ambani received yes from 98.21%, 98.06%, and 92.76% respectively.