Reliance Industries’ (RIL’s) results in the third quarter of FY24 will still be weighed down by the weakness in the refining and petrochemicals business, the impact cushioned by the growth in its retail and digital operations.

The conglomerate is seen reporting net profit of ₹17,272 crore, up over 9 per cent on year, according to an average of estimates from nine brokers. The revenue is seen 5 per cent higher at ₹2.3-lakh crore. Both the profit and revenue would be down a tad sequentially.

The company will be reporting its results on Friday.

The oils to chemicals business contributes about 60 per cent to its revenue. For the oil and gas sector, refining and marketing margins have contracted sequentially, as indicated by the benchmark Singapore GRMs that have fallen 11.7 per cent.

Analysts’ view

RIL’s gross refining margin is estimated at $14 per barrel in the third quarter compared with $19 quarter ago, according to Elara Capital, adding that the O2C business would be reporting a flat EBITDA. Apart from the decline in crack spreads, the rising price of Russian crude has also played a part. With Organization of the Petroleum Exporting Countries reducing production, oil from Russia has been in demand making it more difficult for Indian companies to get discounts.

Jefferies said in its pre-earnings note that RIL would likely post a low single-digit profit growth “due to weak refining and subdued pet-chem.” It added that the consumer businesses growth looked steady.

Motilal Oswal said that its consolidated EBITDA was likely to be flat sequentially and down on a standalone basis.

Reliance Retail

RIL’s retail business is its second-largest revenue contributor.

Motilal Oswal put the operating profit of the retail business to have risen 31 per cent on year and 7 per cent sequentially to ₹5,200 crore. Kotak Securities, in its pre-earnings note, pegged the retail EBITDA at ₹5,896 crore driven by store additions, a rise in footfalls and benefits in operating leverage. The broker also expects the retail division to have recorded revenue of over ₹81,000 crore, a rise of more than a third.

Telecom

Reliance Jio, the country’s largest telecom operator, is expected to have recorded revenue of ₹25,760 crore in the December quarter, according to broker Prabhudas Lilladher, a rise of 4.1 per cent sequentially. It also pegged EBITDA at ₹13,860 crore, up 7.1 per cent.

The average revenue per user in the quarter would be ₹184.9, a rise of 2 per cent.

Investors will be looking out for more clarity on the new energy business, for which it has announced investment of ₹75,000 crore, its recent agreements to set up data centres, and store additions.

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