Home / Companies / Company Results /  Reliance Jio Q4 net profit at 2,331 crore, up 72% QoQ

MUMBAI : Reliance Jio Infocomm Ltd (Jio), the telecom arm of Reliance Industries posted a net profit of 2331 crore in the March quarter, up 72% sequentially, surpassing street estimates. On a year on year basis it grew 177.5%. Its operating revenue increased 6.2% sequentially to 14835 crore. On a year on year basis it is up 26.6%.

Analysts had estimated revenue growth of around 5% sequentially.Standalone EBITDA was reported at of 6,201 crore and EBITDA margin of 41.8%

Average revenue per user (ARPU) increased to 130.6 during the quarter after the operator introduced charges for calls to other operator’s networks in Q3. Last quarter, ARPU was 128.

Data consumption continued to grow exponentially to 11.3 GB per user per month from 11.1 GB in the December quarter and average voice consumption of 771 minutes per user per month with over 50% higher usage during the lockdown. Subscriber base as of 31st March 2020 was 387.5 million with net addition of 17.5 million during 4QFY20 slightly below analyst estimates of 20 million additions.

Mukesh D. Ambani, Chairman and Managing Director, Reliance Industries Limited said, “We are glad that we have made connectivity and operations easier for our customers in these difficult times. Every Jio employee is trained to think Customer First and that has resulted in overwhelming customer response as we are serving close to 40 crore Indians now

The operator also said that there was zero impact on Network Operating Centre due to the lockdown despite minimum staff due to high degree of virtualization and network automation. Traffic surge has been handled with combination of capacity augmentation and technology. During the quarter, network operating expenses increased from 4423 crore in Q3 to 4560 crore.

Reliance Industries Limited, Jio Platforms Limited and ad-tech giant Facebook, Inc. on 22nd April 2020 announced the signing of binding agreements for an investment of 43,574 crore by Facebook into Jio Platforms. Facebook’s investment will translate into a 9.99% equity stake in Jio Platforms on a fully diluted basis. Of the total investment, 14,976 crore will be retained at Jio Platforms to drive future growth. " We have received interest from other global companies for a similar sized stake in the business," said a RIL senior official.

Ambani said that the partnership will focus on India’s 60 million micro, small and medium businesses, 120 million farmers, 30 million small merchants and millions of small and medium enterprises in the informal sector.

"Certainly, all the products and technology that we're building to enable that (Jio) partnership are going to be things that we want to do around the world. So we're very excited about working with them to drive this vision forward and then extending it everywhere over the coming months and years," Mark Zuckerberg, CEO,Facebook told the analysts during an earnings call late Wednesday.

Jio's profit was also boosted by a one-time gain during the quarter of 31 crore related to the reversal of provision on adjusted gross revenue (AGR) dues. "Aggressive sales initiative and customer focused approach have been launched to help recoup slowdown in subscriber addition momentum, as we return to normalcy, " said the company in a statement.

The company said that it continues to be a net recipient of access charges with outgoing traffic mix within the overall offnet traffic now stable at 48-49% (share of calls made to other operators). While Jio had started services with free voice calls noting that the Voice over LTE network did not recognise access charges, the fact that they paid net access charges to other telcom operators was the reason they introduced tariffs on offnet calls in Q3 FY20. The company also nformed that the process of converting initial test fibre to the home users to paid-plans and ramping up sales across 1,600 cities is underway.

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