 |
|
Reliance Industries Limited (RIL), helmed by Mukesh Ambani, has announced its financial results for the first quarter of fiscal year 2026 (Q1FY26), showcasing a substantial increase in consolidated net profit. The company reported a remarkable 78% year-on-year (YoY) surge in net profit, reaching Rs 26,994 crore, a significant jump from Rs 15,138 crore in the corresponding period of the previous year. This figure not only underscores the company's robust performance but also surpasses Street estimates, which had projected a profit of Rs 22,069 crore. The impressive financial results reflect RIL's diverse portfolio and strategic initiatives across various sectors, including oil and gas, retail, and digital services. The company's revenue from operations also experienced growth, rising by 5.3% to Rs 2,48,660 crore, compared to Rs 2,36,217 crore in the same quarter last year. This increase in revenue indicates the company's ability to generate higher sales and expand its market presence across different business segments. The earnings before interest, taxes, depreciation, and amortization (EBITDA) also witnessed a significant increase, standing at Rs 58,024 crore in the quarter under review, marking a 36% rise from Rs 42,748 crore in the corresponding quarter of the previous financial year. The EBITDA margin for the quarter ended June 30, 2025, stood at 21.2%, reflecting a substantial improvement of 460 basis points (bps) compared to 16.6% in Q1FY25. This expansion in EBITDA margin highlights the company's enhanced operational efficiency and effective cost management strategies. RIL's gross revenue also experienced growth, increasing by 6% YoY to Rs 2,73,252 crore ($31.9 billion). This growth was fueled by strong performance across key business segments, including Jio Platform and Reliance Retail Ventures. The Jio Platform revenue saw an impressive increase of 18.8% YoY, driven by robust subscriber growth across mobility and homes, increased consumption, and sustained positive momentum in digital services. The Reliance Retail Ventures (RRVL) revenue also experienced growth, increasing by 11.3% YoY, with all segments performing well, including market-leading performance in grocery and fashion. Despite the overall positive performance, some segments experienced challenges. The Oil to Chemicals (O2C) revenue decreased by 1.5% YoY, primarily due to a fall in crude oil prices and lower volumes resulting from planned shutdowns. However, segment revenues were supported by increased domestic placement of transportation fuels through Jio-BP. Similarly, the Oil & Gas segment revenue decreased by 1.2% YoY, mainly due to lower sales volume of KGD6 gas with natural decline in production, lower gas price for CBM, and lower crude price realization. This decline was partially offset by improved KGD6 gas price realization.
The Jio Platform witnessed a substantial increase in EBITDA, rising by 23.9% YoY, driven by strong growth in ARPU and 210 bps margin expansion led by operational efficiencies. This growth highlights the success of Jio's strategies in attracting and retaining subscribers while optimizing costs. The RRVL EBITDA also experienced growth, increasing by 12.7% YoY, driven by strategic initiatives, operating leverage, and cost discipline. This growth underscores the effectiveness of RRVL's strategies in expanding its market presence and improving profitability. The O2C EBITDA increased by 10.8% YoY, primarily due to favorable margins on domestic fuel retail, improvements in transportation fuel cracks, and PP, PVC delta. This increase was partially offset by lower volumes due to planned turnarounds and a decline in polyester chain margins. The Oil & Gas segment EBITDA decreased by 4.1% YoY, primarily due to lower revenues coupled with an increase in operating costs resulting from higher maintenance activities during the quarter. In addition to the core business operations, the company also earned other income to the tune of Rs 8,924 crore, which included proceeds from the profit from the sale of Asian Paints. This additional income contributed to the overall profitability of the company. Commenting on the results, Chairman & Managing Director Mukesh Ambani stated that RIL has started FY26 with a robust, all-round operational and financial performance. He noted that the consolidated EBITDA for Q1FY26 improved strongly from the year-ago period, despite significant volatility in global macros. Ambani also highlighted the challenges faced by the energy markets during the quarter, with heightened uncertainty and sharp fluctuations in crude prices. Despite these challenges, the O2C business delivered strong growth, with a focus on domestic demand fulfillment and offering value-added solutions through the Jio-bp network. The performance was supported by improvements in fuel and downstream product margins. Ambani also addressed the natural decline in KGD6 gas production, which resulted in a marginally lower EBITDA for the Oil & Gas segment.
Turning to the retail business, Ambani emphasized that RIL's retail business continues to enhance its ability to fulfill everyday as well as specialized needs of all customer cohorts, through a multi-channel approach. This reflects the company's commitment to providing a seamless shopping experience to its customers across various platforms. Addressing the Jio business, Ambani noted that the business scaled newer heights during the quarter, including crossing 200 million 5G subscribers and 20 million home connects. He also highlighted that Jio AirFiber is now the largest FWA service provider in the world, with a base of 7.4 million subscribers. Ambani concluded by stating that the company's Digital Services business consolidated its market position with a robust financial and operational performance. The performance of Reliance Industries in Q1FY26 demonstrates its resilience and ability to adapt to changing market conditions. The company's diversified portfolio, strategic investments, and focus on innovation have enabled it to achieve strong financial results and maintain its leadership position in the Indian market. The impressive growth in net profit, revenue, and EBITDA underscores the company's commitment to creating value for its shareholders and stakeholders. Reliance Industries' Q1FY26 results highlight its strong performance across various sectors, including oil and gas, retail, and digital services. The company's ability to navigate challenging market conditions and deliver robust financial results underscores its leadership position in the Indian market. With its diversified portfolio, strategic investments, and focus on innovation, Reliance Industries is well-positioned for continued growth and success in the future. The company's commitment to creating value for its shareholders and stakeholders remains a key driver of its success.
The increase in revenue and profit for Reliance Industries can be attributed to a combination of factors. One key element is the company's strong performance in the digital services sector, particularly through Jio Platforms. The increase in subscribers, data consumption, and digital service offerings has significantly contributed to the revenue growth of this segment. In the retail sector, Reliance Retail's ability to adapt to changing consumer preferences and expand its product offerings has also played a crucial role. The company's focus on providing a seamless shopping experience through both online and offline channels has helped it attract and retain customers. Furthermore, the increase in domestic placement of transportation fuels through Jio-BP has supported the revenues of the O2C segment, despite challenges posed by falling crude oil prices and planned shutdowns. Effective cost management and operational efficiencies have also contributed to the company's improved profitability. The reduction in costs across various business segments has helped to improve the overall EBITDA margin. However, it is important to note that some challenges remain, particularly in the Oil & Gas segment, where lower sales volume and increased operating costs have impacted profitability. In the future, Reliance Industries plans to continue investing in its digital services and retail businesses. The company aims to expand its 5G network coverage and increase its subscriber base. In the retail sector, Reliance Retail will focus on further expanding its product offerings and enhancing the customer experience. Overall, Reliance Industries' Q1FY26 results demonstrate the company's ability to deliver strong financial results despite challenging market conditions. The company's diversified portfolio, strategic investments, and focus on innovation have enabled it to achieve robust growth and profitability. With its commitment to creating value for its shareholders and stakeholders, Reliance Industries is well-positioned for continued success in the future.
Source: Reliance Industries Q1 Results: Cons PAT jumps 78% YoY to Rs 26,994 cr, beats Street estimates