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Business News/ Companies / Company Results/  Reliance Q4 results: Net profit declines 1.8% YoY to 18,951 crore

Reliance Q4 results: Net profit declines 1.8% YoY to ₹18,951 crore

Consolidated profit at ₹18,951 cr, revenue at ₹2.4 tn; FY24 revenue crosses ₹10 tn

Mukesh Ambani, chairman, RIL.Premium
Mukesh Ambani, chairman, RIL.

MUMBAI:Billionaire Mukesh Ambani-led Reliance Industries Ltd (RIL) saw net profit slip nearly 2% in the March quarter on the back of lower margins in petrochemicals business and higher tax outgo, even as its retail and telecom businesses reported steady growth.

India’s most valuable company reported a consolidated profit of 18,951 crore attributable to owners, against 19,299 crore a year earlier. The earnings fell short of 19,726 crore estimated by eight analystsin a Bloomberg poll. RIL’s consolidated revenue for the year crossed 10 trillion, becoming the first Indian company to cross the mark.

Earnings before interest, tax, depreciation and amortization (Ebitda) was 14% higher, while Ebitda margin rose 50 basis points to 17.8%. Consolidated revenue rose 11% to 2.4 trillion. The company declared a dividend of 10 per share for FY24, apart from 9 per share declared earlier in the year.

For the full year FY24, RIL reported consolidated profit of 69,621 crore, a 4% increase over FY23. Pre-tax profit, meanwhile, grew 11% to cross 1 trillion.

Also Read: RIL Q4 Results Today: Revenue, EBITDA to rise 10% YoY on retail, telecom growth; O2C biz likely stronger

“I am happy to share that this year, Reliance became the first Indian company to cross the 100,000-crore threshold in pre-tax profits," Ambani said in a press statement.

Consolidated revenue for the year grew nearly 11% to cross 10 trillion, while Ebitda grew 16% to 1.8 trillion with an Ebitda marginof17.9%.

“Strong demand for fuels globally, and limited flexibility in refining system worldwide, supported margins and profitability of the O2C segment," Ambani said. O2C is the company’s key oil to chemicals segment engaged in oil refining and a variety of petrochemicals businesses.

“Downstream chemical industry experienced increasingly challenging market conditions through the year. Despite headwinds, maintaining leading product positions and feedstock flexibility through our operating model that prioritizes cost management, we delivered a resilient performance," Ambani said.

Also Read: Reliance Retail Q4FY24 results: Net profit rises 11.7% YoY to 2,698 crore, revenue up 9.8% YoY

Ebitda for the O2C segment for the March quarter was up 3% on-year at 16,777 crore, but Ebitda margin was 90 basis points lower at 11.8%.

“As highlighted, the advantageous feedstock sourcing, ethane cracking and higher domestic product placement were bottom line-accretive," said Nirav Karkera, head of research, Fisdom, while cautioning that benefits on these accounts may taper off in the coming quarters.

Meanwhile, a sharp uptick in production at the company’s KG-D6 field helped offset lower crude prices at RIL’s oil and gas segment. The segment reported a 48% surge in Ebitda to 5,606 crore. Ebitda margins expanded 330 basis points to 86.7%.

Also Read: Reliance Jio Q4 net profit up 13%, 108 mn subs on 5G

“The KG-D6 block has achieved 30 mmscmd of production and now accounts for 30% of India’s domestic gas production," Ambani said. Mmscmd stands for million metric standard cubic meters per day.

The KG-D6 block will be a key lever to further earnings growth for RIL, Fisdom’s Karkera said. “Though the lower realization on the field may appear to be a dampener, the segment made up for it on account of higher volumes," he said.

The company’s retail division reported an 18% on-year growth in Ebitda at 5,829 crore. Margin was up 60 basis points at 8.6%. The segment saw nearly 11% growth in revenue to 76,627 crore as store count grew. The company now operates 18,836 stores across the country, up from 18,040 a year ago.

“Reliance Retail continues to deliver steady performance led by growth across consumption baskets. We continue to invest and innovate across formats and products to improve our customer value proposition and serve evolving consumer needs," said Isha Ambani, executive director, Reliance Retail Ventures Ltd.

The company’s digital services segment, that includes a range of digital services including Jio Platforms, reported Ebitda of 14,644 crore, which was up 9% year-on-year.

While the company reported a nearly 10% year-on-year increase in its user base to 481.8 million subscribers, growth in average revenue per user (Arpu) grew less than 2% to 181.7. Arpu is a key metric in the telecom sector used to track the financial sustainability of providers.

“The management has indicated its commitment to the new energy business, but most developments on this front remains anticipatory. Overall, operating metrics across verticals seem to have stacked up decent and well against broader expectations," Karkera said.

The RIL stock closed 0.65% higher on the BSE on Monday at 2,960.6 against a 0.77% upwards movement in benchmark Sensex. The financial results were declared after the close of trading.

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Published: 22 Apr 2024, 07:06 PM IST
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