Reliance Retail posted a profit of ₹1,830 crore for the third quarter of FY21, which is 4 per cent higher than the same time last fiscal. The Fashion and Lifestyle segment becomes the star performer for the retail arm of Reliance Retail but the grocery segment sees a bleak quarter.

The Mukesh Ambani-owned Retail company’s revenue from operations were at ₹33,018 crore for the quarter that ended on December 31, 2020 compared to ₹40,3680 crore at the same time the previous fiscal, recording a decline of 19 per cent.

The Retail segment’s assets have been more than doubled since the same time last year. For the Q3 of FY21 it stood at ₹98,101 crore compared to ₹45,345 crore Q3 of FY20. The company has also managed to reduce its liabilities in the retail segment to ₹20,407 crore this quarter compared to ₹26,248 crore at the same time last fiscal.

Highest-ever EBITDA

The company posted its highest ever quarterly EBITDA for the retail segment at ₹3,102 crore.

With the Indian economy poised for a rapid recovery in 2021 after overcoming the Covid-19 constraints, Reliance Retail is confident of maintaining its industry leading and market beating performance.

A pre-result report by Goldman Sachs had forecasted the retail segment would drive the growth for RIL this quarter. It had said that the rebound in footfall in retail stores, due to the festival season could be a core driver for the retail revenues. It said the revenues would be up 47 per cent from the previous quarter, and 10 per cent on a year-on-year basis.

“We expect positive growth for grocery, while fashion and electronics will remain flattish YoY. We expect core Ebitda to grow 31 per cent QoQ at 12 per cent below last year’s levels,” it added.

The Retail segment includes consumer retail and a range of related services. During the virtual press conference, Srikanth Venkatachari, CFO, RIL, said that the retail segment has seen a strong recovery of profits despite covid. “Fashion and lifestyle was back to precovid levels. Though, the revenues were impacted because some of the businesses were transferred to the O2C segment. There was also a one-off impact on the grocery segment,” he explained.

The Grocery business and Electronics stores sustained double digit growth while the Fashion and Lifestyle business delivered a strong rebound, surpassing pre COVID levels, it said.

“In Grocery while overall revenue was impacted by COVID restrictions, local issues and the decision to transition Market stores into fulfilment centres to enable New Commerce expansion, the continuing business delivered a healthy double-digit growth. The quarter saw the continued trend of lower footfalls being more than offset by higher bill values across the store network,” the company said in its statement.

Since the beginning of FY21, RIL’s chief Mukesh Ambani has sold nearly 33 per cent in Jio Platforms to global marquee investors. This has brought a cash inflow of around ₹1.52 trillion. Meanwhile, its retail arm, Reliance Retail sold nearly 10 per cent of its stake in the end of 2020 which resulted in raising another ₹47,300 crore for the company.

The company has also been shopping for several retail and e-commerce companies to strengthen its position in the retail sector like the assets of the Future Group, Urban Ladders and NetMeds to name a few.

The retail arm has 12,201 operational physical stores. During the quarter it opened 327 stores. The total area of operation is 31.2 million sq. feet as compared to 29.7 million sq. feet in trailing quarter.

It’s fashion and lifestyle site, AJIO continued to scale new highs with 5X growth in orders over the previous year and significant improvement across customer metrics and operating parameters. It extended its merchant connection to 1,900 cities with 2X more merchant partners onboarded

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