Reliance Industries Ltd (RIL) has posted a 17.3 per cent rise in consolidated net profit at ₹9,435 crore for the fourth quarter ended March 31, buoyant on growth across sectors. In the comparable year-ago period, its net profit had stood at ₹8,046 crore.
For Q4, RIL posted a 39 per cent rise in revenues at ₹1.29 lakh crore (₹92,889 crore).
For the full year ended March 31, RIL posted a 20.6 per cent rise in consolidated net profit at ₹36,075 crore, while revenues rose 30.5 per cent to ₹4.31 lakh crore.
Gross refining margins (GRM) for the year were at a nine-year high of $11.6 a barrel, against $11 a barrel in the previous year, while higher interest and depreciation charges with the commissioning of projects across businesses resulted in relatively lower net profit growth.
“FY18 was a landmark year for Reliance, where we established several records on both operating and financial parameters. RIL has become the first Indian company to record PBDIT of over $10 billion with each of our key businesses — refining, petrochemicals, retail and digital services — achieving record earnings performance,” RIL Chairman and MD Mukesh Ambani said in a statement.
“The overall environment has been good, with a good demand for polymer and polyester,” RIL Joint CFO V Srikanth said at a press conference.
RJio net rises
RIL’s wholly-owned subsidiary Reliance Jio Infocomm (RJio) posted a 1.2 per cent rise in net profit at ₹510.44 crore (₹504.38 crore). For the comparable year-ago quarter, RJio had posted a net loss of ₹17.34 crore.
“Jio had a good quarter in terms of business and subscriber addition. However, we were slightly impacted due to the tariff revisions. We will start to see the benefits of our customer reach programmes in the next few quarters,” said Anshuman Thakur, Head of Strategy and Planning at RJio.
Reliance Retail shines
Reliance Retail, the group’s retail arm, almost doubled its sales at ₹24,183 crore, against ₹10,332 crore in the year ago period.
With that, RIL’s retail business for the whole year stood at ₹69,198 crore, more than double from the previous year, thus making it the biggest retailer in the country. Retail major Future Group’s annual sales for last year stood at around ₹20,000 crore.
Reliance Retail revenue grew 134 per cent YoY to ₹24,183 crore (₹10,332 crore). The company added 86 stores across formats during the quarter.
While Future Group’s retail business comes purely from fashion and food and grocery, Reliance Retail had last year added its merged its petro-retail business to the overall retail segment which has led to the massive jump in the sales figurers and hence cannot be compared with the revenues of the pure-play retailers that depend solely on fashion, consumer durables and FMCG.
The company’s EBIDTA profit for the whole year increased by 114.5 per cent at ₹2,529 crore from ₹1,179 crore. While, the company did not give a break-up on the growth of its different segments, its pure-play retail segment which is grocery, consumer durables, fashion is driving the profits.
“Business without petro and connectivity is supporting the ebidta growth. Pure-play retail bsuiness is 52 per cent of the total revenues. Grocery during the winter season has performed well as we have upscaled the segment and brought in premiumised the products and revamped the stores,” said Gaurav Jain, Head of Corporate Business Development at Reliance Retail.
Jain also mentioned that the e-commerce business aided by Ajio.com is also growing at a rapid pace and about 7 per cent of the revenues comes from e-commerce at present. However, he did not give any guidance on expansion of this segment at a time when global players like Walmart are looking to enter the burgeoning online market.
”We have established strong foundations in retailing and digital services business with world-class supply chain management and network infrastructure which will serve our customers well. It is very heartening to see the traction our service offerings are gaining, with discerning Indian consumers. The growing Indian market provides exciting opportunities to scale-up these businesses and maximize long-term shareholder value in the coming years,” said Mukesh Ambani, chairman, Reliance Industries Limited that operates 3,837 stores with an area of over 17.7 million square feet.
Reliance Retail's profit before depreciation, interest, and taxes for the year grew 114% year-on-year to ₹2,529 crore as compared to ₹1,179 crore a year ago.
Reliance also retails premium international brands such as Armani, Diesel, Super Dry and Michael Kors through its JV with Genesis Luxury Fashion.