Reliance Industries Ltd (RIL) reported a stellar set of numbers where net profit, revenues, as well as Jio numbers were better than estimates for the quarter ended September.
The stock closed with gains of 1.3 percent on the BSE at Rs 2,054 on Friday.
The outperformance came amid the outbreak of the COVID-19 pandemic globally and in India which causing is significant disturbance and slowdown in economic activity.
"We delivered strong overall operational and financial performance compared to the previous quarter with recovery in petrochemicals and retail segment and sustained growth in Digital Services business," Mukesh D. Ambani, Chairman, and Managing Director, RIL, said in a press statement.
"Domestic demand has sharply recovered across our O2C business and is now near the pre-Covid level for most products. Retail business activity has normalised with strong growth in key consumption baskets as lockdowns ease across the country," he said.
He further added that with large capital raise in the last six months across Jio and Retail business, several strategic and financial investors have been welcomed into the Reliance family.
We have collated a list of 10 takeaways from RIL Q2 results:
RIL net profit:
RIL consolidated net profit before exceptional item for the quarter ended September stood at Rs 10,602 crore, higher by 28 percent on a quarter-on-quarter period. The CNBC-TV18 Poll estimated a net profit of Rs 8134 crore.
Net Profit after exceptional item fell by 20 percent on a YoY basis to Rs 10602 crore in Q2, compared to Rs 13,248 crore reported sequentially.
The exceptional gain of Rs 4,966 crore (net of taxes of ₹ 1,508 crore) in 1Q FY21 was due to profit on the divestment of shares of Reliance BP Mobility Limited.
Total revenue grew by more than 27 percent on a sequential basis to Rs 128,385 crore for the quarter ended September, compared to Rs 100,929 crore reported in the June quarter of the same fiscal.
The increase in revenue was primarily due to higher price realisations in the O2C segment, a strong recovery in retail operations, and sustained subscriber addition with improvement in ARPU in the digital services business, the company said in the statement.
Use of proceeds of rights issue:
The entire funds raised by the company through the rights issue, including the amount received during the quarter ended September 30, 2020, has been utilised for repayment of all or a portion of certain borrowing availed by the company, and general corporate purposes.
Reliance Jio net profit rose by nearly 20 percent sequentially to Rs 3020 crore for the quarter ended September, compared to Rs 2520 crore reported in the June quarter.
The revenue from operations also saw a steady rise of more than 7 percent QoQ to Rs 18,496 crore for the quarter ended September.
Jio Platforms Limited, a wholly owned subsidiary of Reliance Industries Limited, raised Rs 152,056 crore from leading global investors including Facebook, Google, Silver Lake, Vista Equity Partners, General Atlantic, KKR, Mubadala, ADIA, TPG, L Catterton, PIF, Intel Capital and Qualcomm Ventures.
The total customer base as on September 30, 2020, is 405.6 million. ARPU or average revenue per user during the quarter stood at Rs 145.0 per subscriber per month.
The total wireless data traffic during the quarter was 1,442 crore GB while the total voice traffic during the quarter stood at 93,223 crore minutes.
Reliance Retail consolidated net profit rose by 125 percent for the September quarter on a sequential basis, while revenues grew by 30 percent to Rs 41,100 crore in the same period.
Consolidated value of sales and services for 2Q FY21 increased by 30 percent on a Q-o-Q basis to Rs 41,100 crore, a strong performance given that the full store network was not operational and with footfalls still significantly lower than pre-COVID levels.
Revenue from operations for 2Q FY21 increased by 29.7 percent Q-o-Q to Rs 36,566 crore, and at the same level as the last year despite restricted store operations and lower footfalls.
Reliance Retail Ventures Limited (RRVL), a wholly owned subsidiary of Reliance Industries Limited, raised Rs 37,710 crore of investments from leading global investors including Silver Lake, KKR, General Atlantic, Mubadala, GIC, TPG, and ADIA.
With revenues of Rs 41,100 crore and EBITDA of Rs 2,006 crore, it marks an industry-leading performance with a ‘V-shaped’ recovery over 1QFY21, as sales grew 30 percent, EBIDTA nearly doubling and margin improving +170 bps Q-o-Q, the company said.
The segmental revenue increased by 17.8 percent on a Q-o-Q basis with higher prices across the product portfolio and higher volumes.
Segmental EBITDA for 2Q FY21 increased by 34.6 percent Q-o-Q to Rs 5,964 crore primarily on account of higher production volume and higher volume placement in the domestic market.
EBITDA margins also improved sequentially by 250 bps with firm cracker margins, effective product, and sales mix, and superior ethane cracking economics.
Refining & GRM:
Refining segment revenues for 2Q FY21 increased by 33.3 percent Q-o-Q to Rs 62,154 crore primarily due to higher crude oil prices. Dubai crude price averaged at $42.9/bbl during the quarter v/s $30.5/bbl in 1QFY21, up 40.5% Q-o-Q.
Segmental EBITDA for 2Q FY21 declined by 21.4 percent Q-o-Q to Rs 3,002 crore primarily on account of lower-middle distillates cracks and narrower light-heavy crude differential leading to higher crude cost.
Reliance Industries' Q2 gross refining margin was at $5.70/bbl versus $6.30/bbl, QoQ.
Oil & Gas business:
Oil and gas segment revenues for 2Q FY21 declined by 29.8 percent Q-o-Q to Rs 355 crore primarily due to lower price realisation and decline in production.
Outstanding debt as of September 30, 2020, was Rs 279,251 crore ($37.9 billion). Cash and cash equivalents as of September 30, 2020, were at Rs 185,711 crore ($25.2 billion).
Funds received post-quarter-end and balance capital commitment receivables are in excess of quarter-end net debt levels.
RIL retained its domestic credit ratings of “CRISIL AAA/Stable” from CRISIL and “IND AAA/Stable” from India Ratings and an investment-grade rating for its international debt from Moody’s as “Baa2” and “BBB+” from S&P.
Fitch has upgraded RIL Local-Currency Issuer Default Rating (IDR) to ‘BBB+’ from ‘BBB’ and retained Foreign-Currency IDR as ‘BBB- ‘.
Disclaimer: Reliance Industries Ltd, which owns Jio and Retail, is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd which publishes moneycontrol.com.