Reliance Industries Q3FY24: Net profit grows 11% to Rs 19,641 cr retail, Jio, oil & gas business

The primary contributors to this enhanced profitability were the consumer-oriented enterprises and the oil & gas division.

Reliance registered a substantial 16.7 percent year-on-year rise in quarterly EBITDA (earnings before interest, tax, depreciation, and amortization), reaching Rs 44,678 crore, with growth evident across all its business sectors.

This double-digit surge in consolidated EBITDA was propelled by a 31.1 percent increase in Reliance Retail Ventures and a significant 49.6 percent jump in the oil & gas segment.

The conglomerate successfully elevated its consolidated EBITDA margin to 18 percent for the quarter, marking a noteworthy improvement of 210 basis points compared to the corresponding period in the previous fiscal year.

Jio Platforms demonstrated robust financial performance in the quarter, with a noteworthy 11.6 percent year-on-year growth in net profit, reaching Rs 5,445 crore. Concurrently, revenue achieved a record high of Rs 32,510 crore, marking an 11.4 percent YoY increase.

The Average Revenue Per User (ARPU) also saw a 2 percent YoY rise to Rs 181.7, driven by an improved subscriber mix, although this was partially offset by the inclusion of unlimited data allowances on the 5G network.

The accelerated rollout of 5G significantly contributed to the momentum in subscriber additions, with Jio surpassing competitors by adding 11.2 million net subscribers in Q3FY24. This brought the total subscriber base to an impressive 470.9 million.

Despite the unlimited data allowances on the 5G network, customer engagement on the Jio network remained robust, with total data and voice traffic increasing by 31.5 percent to 38.1 billion GB and 7.9 percent to 1.37 trillion minutes, respectively, compared to the previous year.

Notably, Jio successfully deployed the Jio True 5G network across India ahead of schedule, with around 90 million subscribers already migrated to this advanced network.

"The strong uptake of the JioBharat phone and JioAirFiber services has resulted in the continued expansion of Jio’s subscriber base, contributing to the stellar growth numbers of the digital services business,” Mukesh D Ambani, Chairman and Managing Director, said.

The media business demonstrated robust operational performance in various sectors. The revenue of the TV News business increased by 23 percent compared to the previous year, propelled by substantial growth in advertising revenue across different clusters.

The Digital News business reported a 20 percent growth in revenue, attributed to intellectual property events and video monetization on digital platforms.

Reliance Retail achieved impressive results with a record quarterly revenue of Rs 83,063 crore, up 22.8% YoY. Net profit increased by 31.9% to Rs 3,165 crore, and the EBITDA margin expanded to 8.4%, driven by operational efficiency. The company added 252 new stores, totalling 18,774, and recorded 282 million footfalls, a 40.3% YoY growth.

The oil & gas exploration and production segment reported strong quarterly performance, with a 50.2% YoY revenue increase to Rs 6,719 crore. Higher volumes drove growth, offset by lower price realization from the KG D6 Field.

The segment achieved its highest-ever quarterly EBITDA at Rs 5,804 crore.

KG D6 gas averaged $9.66/MMBTU in Q3FY24, down from $11.32 in Q3FY23, and CBM gas averaged $15.55 per MMBTU, compared to $20.92 in the same period.

“KG D6 is now contributing 30 percent of India’s gas production, fueling its transition towards a greener and cleaner tomorrow,” Ambani said.

The O2C (Oil-to-Chemicals) segment exhibited resilient performance, benefiting from operational flexibility and strong domestic demand. Despite a 2.4 percent year-on-year decline in quarterly revenue to Rs 1.41 lakh crore, attributed to lower price realization amid a 5.3 percent drop in average Brent crude oil prices, the O2C EBITDA marginally increased by 1 percent to Rs 14,064 crore.

This growth was driven by higher gasoline cracks and advantageous feedstock sourcing, partially offset by lower downstream chemical margins and planned maintenance and inspection shutdown. The margin expanded by 40 basis points to 10 percent for the quarter.

The company noted that planned maintenance and inspection shutdown of key units impacted yields and profitability, and the O2C EBITDA would have been higher on a YoY and comparable on a QoQ basis with the availability of all major units during the quarter.

Reliance’s New Energy Giga Complex is all set to be commissioned in the second half of CY24.

“I am confident that Reliance’s New Energy business will play a pivotal role in the global movement for adoption of cleaner fuels,” Ambani said.

In the December quarter, Reliance experienced a 22.1% YoY increase in tax expenses, reaching Rs 6,345 crore, and a 26.7% surge in depreciation to Rs 12,903 crore due to expanded assets and increased activities in digital services and upstream production.

Finance costs rose by 11.3% to Rs 5,789 crore, driven by higher loan balances and interest rates. Outstanding debt increased to Rs 3,11,743 crore, with net debt rising to Rs 1,19,372 crore.

However, the net debt to EBITDA ratio improved to 0.67 from 0.72.

Capital expenditure for the quarter was Rs 30,102 crore, focusing on 5G rollout, retail expansion, and new energy initiatives. This marked a decrease from the Rs 37,599 crore spent in the same quarter last year.