Reliance Industries Ltd is poised for a robust performance in the June quarter, with key business segments such as telecommunications, retail, and oil-to-chemicals (O2C) expected to deliver growth in operating profits. The O2C division is expected to boost margins this quarter, signalling a turnaround after a challenging year, analysts said.
According to a Moneycontrol survey of nine analysts, Reliance’s consolidated revenue for the fiscal first quarter is projected at Rs 2.46 lakh crore, a 6 percent increase from Rs 2.32 lakh crore in the same period last year. EBITDA is estimated to rise by 16 percent to Rs 44,961.2 crore from Rs 38,765 crore a year earlier. Net profit is expected to surge 40 percent to Rs 21,233.1 crore from Rs 15,138 crore a year earlier, and also up from Rs 19,407 crore reported in the preceding March quarter.
Consolidated EBITDA is estimated to grow 15.4 percent year-on-year and 2.1 percent sequentially, driven by 19–20 percent growth in the O2C, digital, and retail businesses, although partially offset by weakness in the exploration and production (E&P) segment. Reported PAT will be further supported by a one-time post-tax gain of Rs 9,000 crore from the stake sale in Asian Paints.
Ahead of Q1 result announcement, Reliance Industries said on Friday its unit, Reliance Retail, has acquired home appliance maker Kelvinator in a bid to expand into the fast-growing consumer durables market.
What factors could drive the earnings?
O2C Segment: In the O2C segment, EBITDA is projected to improve by 17.7 percent year-on-year, aided by an estimated $0.4 per barrel sequential increase in gross refining margins (GRMs). While petchem margins are expected to see some recovery, lower throughput due to a refinery shutdown could limit upside. The upstream segment, however, is likely to remain under pressure due to marginally lower production volumes and a higher government share in profit petroleum.
Digital services: The segment is expected to post steady growth. Average revenue per user (ARPU) is likely to increase 0.8 percent quarter-on-quarter, supported by one additional day in Q1 versus Q4. Mobile revenue is estimated to grow 1.6 percent sequentially. Jio is projected to have added 10.5 million mobile subscribers in Q1 FY26, up from 6.1 million in the previous quarter, taking the total subscriber base to approximately 477.5 million. Strong momentum in fixed broadband, particularly 5G fixed wireless access (FWA), is expected to result in net additions of around 3 million subscribers during the quarter. Revenue and EBITDA are forecast to grow 2.5 percent and 3.4 percent quarter-on-quarter, respectively. However, PAT is expected to rise marginally by 0.5 percent to Rs 6,700 crore, as depreciation and interest costs increase with 5G-related expenditure.
Retail business: The retail segment is likely to maintain its strong momentum, with EBITDA expected to grow 19 percent year-on-year and remain flat sequentially, driven by improved revenue per square foot and healthy margins. Retail revenue is projected to rise 20.8 percent year-on-year and 3.1 percent quarter-on-quarter to Rs 91,380 crore, with an EBITDA margin of 7.6 percent.
Oil & Gas: In contrast, the oil and gas (O&G) segment may see a 10 percent year-on-year and 8 percent sequential decline in EBITDA due to a 9 percent drop in production from the KG-D6 block, despite a 2 percent increase in deepwater gas prices year-on-year.
Investors will likely focus on Reliance’s Rs 75,000 crore investment plan in the new energy business, the pace of retail store expansion, and any updates on pricing strategies in telecom.
Disclaimer: Moneycontrol is a part of the Network18 group. Network18 is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
