RIL misses estimates on Rs 4,267 crore exceptional loss: Key Q4 highlights

Mumbai: Energy-to-telecom conglomerate Reliance Industries missed Street estimates as it reported a 38.73 per cent year-on-year (YoY) fall in consolidated net profit .

The company reported a consolidated net profit of Rs 6,348 crore for the quarter ended March 31, while analysts in an ETNow poll had projected the number at Rs 10,500 crore.

For the quarter ended March, RIL logged revenues of Rs 1,51,209 crore, a decrease of 2.5 per cent from a year ago, primarily on account of 10.1 per cent decline in refining and petrochemicals business revenues.

This was partially offset by continuing growth in consumer businesses, the company said, pointing that its digital services and retail business recorded an increase of 30 per cent and 4.2 per cent YoY respectively in revenue during the quarter.

Here are the key highlights:

Jio shines: Reliance Jio Infocomm reported a near tripling of net profit for the January-March period, helped by tariff raises that aided its average revenue per user (ARPU) rise for the second straight quarter after seven quarters of declines.

The telco, led by Mukesh Ambani, on Thursday said profit for the quarter rose to Rs 2,331 crore compared with Rs 840 crore a year ago. The market had estimated profit to be around Rs 2,000 crore. Profit was up 73 per cent from the preceding quarter. It is the company’s tenth profitable quarter in a row.

The company said it had witnessed strong investor interest in Jio platforms and will receive Rs 43,574 crore from Facebook for a 9.99 per cent stake. Jio platforms have also received interest from other global investors for similar-sized additional stake

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Biggest rights issue ever: RIL announced a rights issue of Rs 53,125 crore, a first by the company in three decades and also India’s biggest ever in history. The issue will be in the ratio of 1:15 at a price of Rs 1,257 per share. It said founders will fully subscribe to the rights issue, and will also take up unsubscribed portions, if any.

The company said it will complete a capital raise of over Rs 104,000 crore by Q1 – including the rights issue, Facebook investment and the previous investment by BP.

Dividend: The company announced a dividend of Rs 6.50 per share.

Extraordinary provision: There has been significant volatility in oil prices, resulting in uncertainty and sharp reduction in oil prices, the company noted. Through the quarter, oil prices declined 73 per cent impacting inventory valuation. In light of this, RIL provided for non-cash inventory holding losses for the quarter, which has been disclosed as an exceptional item of Rs 4,245 crore.

Saudi Aramco deal on track: In spite of the Covid-19 crisis and the lockdowns, the due-diligence by Saudi Aramco for the planned investment in the O2C business is on track as both the parties are committed and actively engaged, the company said.

Covid-19 impact: Global oil demand in CY2020 is expected to fall by 9.3 million barrels/day YoY, the lowest level in the last eight years. As a result, global refining utilization and economics are likely to get impacted in the near term.

The pandemic outbreak impacted the petrochemical segment during the quarter with demand slowdown in most end-use markets including consumer discretionary and packaging demand.While RIL maintained near-normal utilization at all major facilities, gradual resumption of economic activity in the coming months is expected to aid demand recovery for fuels and petrochemical products, it said in a release.

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Non-grocery retail business was impacted by the nationwide lockdown.

Reliance Retail: Reliance Retail operates 11,784 stores covering 28.7 million square feet with over 1,500 stores opened in the year and a record 30 per cent retail space added. The company’s segment revenue for the March quarter grew by 4.2 per cent YoY to Rs 38,211 crore, while EBITDA for the quarter grew by 32.9 per cent YoY to Rs 2,556 crore.

“Overall, the year has been a growth year with March being a tepid month due to the Covid-19 lockdown impact,” RIL said in a release.

Refining & Marketing: Gross refining margins (GRMs) for March quarter was at $8.9/bbl, outperforming Singapore complex margins by $7.7/bbl. March quarter revenue from the refining and marketing segment declined by 3.4 per cent YoY to Rs 84,854 crore while segment EBIT increased by 28.2 per cent YoY to Rs 5,706 crore with higher throughput and better GRMs.

Petrochemicals: March quarter revenue from the petrochemicals segment decreased by 24.1 per cent YoY to Rs 32,206 crore due to lower price realizations along with disruptions in local and regional markets.

Exploration & production: The revenue for the oil & gas segment for the quarter ended March decreased by 41.5 per cent YoY to Rs 625 crore. The segment performance continued to be impacted by low volumes and declining prices.

Media business: Network18 Media & Investments reported 4QFY20 consolidated revenue of Rs 1,464 crore, an increase of 18.9 per cent YoY.

Debt: RIL’s outstanding debt as on March 31 was Rs 3,36,294 crore.

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Cash balances: Cash and cash equivalents as on March 31, were at Rs 1,75,259 crore.



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