Reliance posts lower profits, retail hit by second wave
"We remained focused on ensuring supplies of necessities through a combination of online-offline channels," says Mukesh Ambani, Chairman of Reliance Industries.
India’s most valuable company Reliance Industries (RIL) reported consolidated profit of Rs 12,273 crore in the first quarter of fiscal year (FY) 2022. It was a 7 percent sequential decline, and 7.25 percent lower than the profit in the same quarter a year ago.
The dip in earnings was due to low demand in its retail business, as the second wave of COVID-19 led to partial lockdowns in the April to June 2021 quarter.
RIL's revenue in the first quarter of FY 2022 also dropped by 6 percent to Rs 1,48,591 crore sequentially, though this was 55 percent higher than its consolidated revenue of Rs 95,626 crore a year ago.
On a consolidated basis, RIL's operating margin rose 172 basis points to 18.5 percent sequentially. The operating profit of Rs 27,550 crore in the June 2021 quarter grew 3.5 percent sequentially, and by 27.6 percent over the same quarter a year ago.
Retail was its worst-hit business, as revenue fell by 18.7 percent to Rs 33,566 crore in June 2021. The operating profit also fell by 46.3 percent in June, compared to Rs 3,623 crore a quarter ago.
“COVID-related restrictions on store operations during the quarter impacted our retail business operations and profitability,” Mukesh Ambani, Chairman and Managing Director of Reliance Industries, said in a media release.
At Rs 3,651 crore, Jio Platform witnessed a quarterly profit growth of 4 percent over the previous quarter, and 44.9 percent over the same quarter last year. Its operating revenue increased 3.6 percent sequentially, and by 9.8 percent compared to the same quarter last year.
With an average revenue per user of Rs 138.4, Jio now has 440 million customers as it added 42.3 million users between April and May 2021.
The company’s stock fell 0.7 percent before the results on Friday. It has fallen 2.3 percent in the past month.
Edited by Kunal Talgeri