RIL Q4 net profit more than doubles

Billionaire Mukesh Ambani's Reliance Industries Ltd on Friday reported more than doubling of its March quarter net profit as consumer businesses of retail and telecom as well as petrochemicals saw sequential recovery on improved spreads offsetting continued weakness in refining business.

Consolidated net profit of Rs 13,227 crore in January-March compared with Rs 6,348 crore earned a year back, the company said in a statement.

The fourth quarter net profit included Rs 797 crore exceptional item due to gain on sale of US shale assets.

Revenue was up 13.6 per cent to Rs 1,72,095 crore.

The oil-to-telecom conglomerate posted the highest ever annual net profit of Rs 53,739 crore, up 34.8 per cent year-on-year.

This was aided by record annual EBITDA for Jio Platforms at Rs 32,359 crore and highest ever annual EBITDA for Reliance Retail at Rs 9,789 crore.

While the oil-to-chemical or O2C business improved quarter-on-quarter, it was lower than year-ago earnings primarily due to weakness in the refining business.

This was more than made good by a spurt in consumer-facing businesses of telecom and retail which now contribute to 45 per cent of earnings as compared to 33 per cent a year back.

Jio Platforms, which houses the firm's telecom arm, posted a 47.5 per cent net profit to Rs 3,508 crore in January-March as it added over 1.54 crore net subscribers.

But a switch to 'bill and keep regime' from 'interconnect usage charges' saw its per user earning fall to 138.2 per month from Rs 151 in the previous quarter.

It had 42.62 crore  subscribers at the end of March.

Jio's data traffic during the quarter stood at 16.7 billion GB, up 5.2 per cent quarter-on-quarter while voice traffic at 1.03 trillion minutes was up 6 per cent.

Its average monthly per user data consumption was strong at 13.3 GB and voice consumption was at 823 minutes.

Subscriber additions picked up following the new JioPhone offer in March.

A record revenue from grocery business and strong growth in consumer electronics saw net profit from retail business rise 45 per cent quarter-on-quarter to Rs 2,247 crore in Q4.

The firm added 826 stores to take the number of stores to 12,711.

But the resurgence of Covid infections has impacted the retail operations in April, with footfalls dropping to 35-40 per cent of pre-Covid levels.

While there was a sustained recovery in petrochemical margins, refineries operated at lower capacity due to the pandemic, pulling down O2C EBITDA by 4.6 per cent to Rs 11,407 crore.

The start of gas production from newer discoveries in the eastern offshore KG-D6 block led to the company seeing its second straight quarter of pre-tax profits in the segment after many years.

For the full 2020-21 fiscal, revenue was down 18.3 per cent at Rs 5,39,238 crore and net profit was up nearly 35 per cent at Rs 53,739 crore.

Reliance announced a dividend of Rs 7 per share for the fiscal year ending March 31, 2021.

Jio Platforms posted full year net profit of Rs 12,537 crore while Reliance Retail full year profits stood at Rs 5,481 crore.

Commenting on the results, Mukesh Ambani, chairman and managing director, Reliance Industries Limited, said: "We have registered robust recovery in O2C and retail segment, and resilient growth in Digital Services business (which includes telecom unit Jio)."

"Sustained high utilisation rates across sites and improvement in downstream product deltas as well as transportation fuel margins aided O2C earnings growth.

"Our consumer businesses have proved to be a digital and physical lifeline for the nation in these challenging times," he said.

While COVID-19 disrupted livelihoods, Reliance added nearly 75,000 jobs to the economy, he said without giving details.

"These are extraordinarily challenging times for India. Our immediate priority is to help our country and community tide over the COVID crisis.

"We have deployed our best resources in strengthening the nation's fight against the pandemic.

"Our facilities in Jamnagar are producing life-saving medical grade oxygen, which is the crucial need of the hour in many states," Ambani said.

The fourth quarter of FY21 marks the start of an earnings upgrade cycle after a year of challenges.

Higher chemical margins (LDPE and PVC are at decade highs) more than negate slower per user telecom revenue.

Refining margins are recovering despite lockdowns as inventories unwind as permanent refinery shutdowns continue globally.

FY22 earnings, however, face downside risks as blip on fuel demand due to resurgence of Covid inflections delays return to refineries to pre-pandemic utilisation and profitability levels, telecom tariff hikes continue to be delayed and retail recovery could be impacted by a fresh set of restrictions.

Gross debt fell to Rs 251,811 crore as of March-end when compared to Rs 257,413 crore as of December-end, while cash at hand rose to Rs 254,019 crore from Rs 220,524 crore.

Net debt stood at a negative (-) Rs 2,208 crore.

Reliance has completed fundraising from selling minority stakes in Jio Platforms Ltd -- the unit that holds telecom and digital businesses, and Reliance Retail to global investors.

It raised Rs 152,056 crore in Jio and Rs 47,265 cr in retail.

A cumulative cash inflow of Rs 220,231 crore helped it turn into a net cash surplus company.

Photograph: PTI Photo