Companies

For RIL, telecom business picks up as oil/gas segment disappoints in Q2

Our Bureau. MUMBAI | Updated on October 30, 2020 Published on October 30, 2020

Consolidated net declines 20 per cent in the July-September quarter to ₹10,602 crore

The consolidated net profit of Reliance Industries Ltd declined 20 per cent in the July-September quarter to ₹10,602 crore compared to a profit of ₹13,248 crore in the first quarter of the current fiscal.

The company had reported 6.6 per cent higher net profit of ₹11,352 crore in the second quarter of last year. The decline was due to a dip in demand at its oil refining and petrochemicals businesses due to the pandemic.

Overall revenue was up sequentially at ₹1.20 lakh crore compared to ₹95,626 crore in the first quarter but was down 24 per cent compared to the revenue in the same period last year. The revenue from petrochemicals fell 23 per cent, refining fell 36 per cent, oil and gas fell 55 per cent, and retail fell 4.9 per cent year- on-year.

 

Rjio net surges

The telecom business did better with Reliance Jio Infocomm (RJio) posting a net profit of ₹2,844 crore, up from from ₹990 crore recorded during the same period a year ago. In the sequential first quarter ended June 30, the company had recorded a net profit of ₹2,520 crore.

“We delivered strong overall operational and financial performance compared to previous quarter with recovery in petrochemicals and retail segment, and sustained growth in digital services business,” Mukesh Ambani, Chairman and Managing Director, Reliance Industries, said in a statement. During the reporting quarter, RJio’s total income rose to ₹17,678 crore, up from ₹13,157 crore recorded during the same period a year ago, and ₹16,833 crore posted in the June quarter.

ARPU rises

The company’s Average Revenue Per User (ARPU), an important financial metric for a telecom company, rose to ₹145 riding on the back of the previous tariff hike, from ₹140 recorded in June quarter. The firm has the largest mobile subscriber base of 405.6 million in India, and also first operator outside China to attain this milestone, Anshuman Thakur, Head of Strategy and Planning at RJio, said in a video call.

Jio Platforms, which had entered into an agreement to raise ₹152,056 crore from global investors such as Facebook, Google, Silver Lake, General Atlantic and KKR among others, received ₹118,319 crore as of the end of the quarter. The company is expecting another ₹33,737 crore, he added.

Wireless gross addition showed a strong sequential increase to 27.2 million as lockdown restrictions began to ease during the quarter, while monthly churn rate for wireless subscribers increased to 1.69% with follow through impact of Covid-19 on SIM consolidation and recharge cycle of migrant population. The company’s average wireless data consumption per user per month stood at 12.0 GB and average voice consumption at 776 minutes per user per month on rise in application-based voice on data networks.

“5G is an exiting opportunity for RJio and as a telecom operator it’s a whole new ball game, unlocking many new class of services. With 5G we can offer speeds of upto 1 gigabytes per second,” Kiran Thomas President, RIL, said.

 

Retail near normal

“Retail business activity has normalised with strong growth in key consumption baskets as lockdowns ease across the country. With large capital raise in last six months across Jio and Retail business, we have welcomed several strategic and financial investors into Reliance family. We continue to pursue growth initiatives in each of our businesses with a focus on the India opportunity,” Ambani added.

 

 

 

The consolidated net profit of Reliance Industries Ltd declined 20 per cent in the July-September quarter to ₹10,602 crore compared to a profit of ₹13,248 crore in the first quarter of the current fiscal. The company had reported 6.6 per cent higher net profit of ₹11,352 crore in the second quarter of last year. The decline was due to a dip in demand at its oil refining and petrochemicals businesses due to the pandemic.

Overall revenue was up sequentially at ₹1.20 lakh crore compared to ₹95,626 crore in the first quarter but was down 24 per cent compared to the revenue in the same period last year. The revenue from petrochemicals fell 23 per cent, refining fell 36 per cent, oil & gas fell 55 per cent, and retail fell 4.9 per cent year- on-year.

 

The telecom business did better with Reliance Jio Infocomm (RJio) posting a net profit of ₹2,844 crore, up from from ₹990 crore recorded during the same period a year ago. In the sequential first quarter ended June 30, the company had recorded a net profit of ₹2,520 crore.

“We delivered strong overall operational and financial performance compared to previous quarter with recovery in petrochemicals and retail segment, and sustained growth in digital services business,” Mukesh Ambani, Chairman and Managing Director, Reliance Industries, said in a statement.

During the reporting quarter, RJio’s total income rose to ₹17,678 crore, up from ₹13,157 crore recorded during the same period a year ago, and ₹16,833 crore posted in the June quarter.

ARPU rises

The company’s Average Revenue Per User (ARPU), an important financial metric for a telecom company, rose to ₹145 riding on the back of the previous tariff hike from ₹140 recorded in June quarter. The firm has the largest mobile subscriber base of 405.6 million in India, and also first operator outside China to attain this milestone, Anshuman Thakur, Head of Strategy and Planning at RJio, said in a video call.

Jio Platforms, which had entered into an agreement to raise ₹152,056 crore from global investors such as Facebook, Google, Silver Lake, General Atlantic and KKR among others, received ₹118,319 crore as of the end of the quarter. The company is expecting another ₹33,737 crore, he added.

Wireless gross addition showed a strong sequential increase to 27.2 million as lockdown restrictions began to ease during the quarter, while monthly churn rate for wireless subscribers increased to 1.69% with follow through impact of Covid-19 on SIM consolidation and recharge cycle of migrant population. The company’s average wireless data consumption per user per month stood at 12.0 GB and average voice consumption at 776 minutes per user per month on rise in application-based voice on data networks.

“5G is an exiting opportunity for RJio and as a telecom operator it’s a whole new ball game, unlocking many new class of services. With 5G we can offer speeds of upto 1 gigabytes per second,” Kiran Thomas President, RIL, said.

On the oil business, Ambani said that domestic demand has sharply recovered across the O2C business and is now near pre-Covid level for most products. “ Retail business activity has normalised with strong growth in key consumption baskets as lockdowns ease across the country. With large capital raise in last six months across Jio and Retail business, we have welcomed several strategic and financial investors into Reliance family. We continue to pursue growth initiatives in each of our businesses with a focus on the India opportunity,” Ambani added.

 

 

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Published on October 30, 2020
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