Reliance Industries' consolidated Q2 earnings rise by 13% yoy despite widening RJio's loss

Mukesh Ambani's Reliance Industries witnessed 12.5% year-on-year (YoY) rise in its consolidated net profit to Rs 8,109 crore for the second quarter ended September 30, 2017. 

RIL posted net profit of Rs 7,209 crore in the corresponding period of the previous year. However, on quarter-on-quarter (QoQ), the company saw decline of 11% from Rs 9,108 crore in Q1FY18. 

Revenue from operations stood at Rs 101,169 crore - reflecting growth of 23.9% yoy and 11.7% qoq. 

Growth in EBIT increased by 32.2% yoy to Rs 17,896 crore in Q2. While cash profit was at Rs 13,171 crore up by 27.8% yoy. 

On standalone front, revenue registered rise of 16.8% yoy to Rs 75,165 crore and net profit was also up 7.3% yoy to Rs 8,265 crore in Q2. 

Gross Refining Margin (GRM) for the quarter stood at $ 12.0 per barrel. 

Mukesh D. Ambani, Chairman and Managing Director, Reliance Industries Limited said: “Our Company reported another quarter of robust performance. I am delighted to share that this includes the financial performance of Reliance Jio which had a positive EBIT contribution in its first quarter of commercial operations. "

Ambani added on RIL's performance, "The results also reflect strong underlying fundamentals of our refining and petrochemicals businesses. Sustained demand growth coupled with supply disruptions further tightened demand supply balances globally during the quarter."

In this quarter,  revenue from the Refining and Marketing segment increased by 15.3% Y-o-Y to Rs 69,766 crore ($ 10.7 billion). While Petrochemicals business contributed Rs  27,999 crore ($ 4.3 billion) revenue, rising by 24.9% Y-o-Y todue to higher volumes in the polyester chain and firm prices.

Also revenue for the Oil & Gas segment increased by 13.3% Y-o-Y to  Rs 1,503 crore due to commencement of CBM production.

Interestingly, data provided by RIL, it was known that Reliance Jio's net loss widened in Q2 at Rs 270.59 crore compared to net loss of Rs 21.27 crore in Q1FY18 and net loss of Rs 3.90 crore in Q2FY17. 

RJio has completed one year since its launch in September 2016, and the revenue from operation now stands at Rs 6,147.06 crore by end of September 30, 2017. 

On RJio, Ambani mentioned, "The strong financial results of Jio demonstrates the robust business model of Jio and the significant efficiencies that the Company has built through its investment in the latest 4G technology and right business strategy."

Key Highlights of Reliance Jio in Q2 were. 

• Number of customers who have adopted Jio services in Q2 was at 19.5 million
• 15.3 million net additions of Jio in Q2 - makign it fastest growing digital services company
• ARPU during the quarter of Rs 156.4 / sub per month
• Total wireless data traffic during the quarter at 378 crore GB
• Average voice traffic during the quarter at 267 crore minutes per day
• Working with the relatively new VOLTE technology, highest per capita voice consumption at 626 minutes per month
• It crossed 100 million subscribers in 170 days, adding at an average rate of 6 lakh subscribers per day. 
• Jio continues its rapid ramp-up of subscriber base and as of 30th September 2017, there are 138.6 million subscribers on the network.

 
He added, ". We are confident that Jio will bring significant benefits to the Indian economy and the Indian customers and will take India to a much higher pedestal."

Outstanding debt of RIL as on September 2017, stands at Rs  214,145 crore ($ 32.8 billion) higher compared to Rs 196,601 crore as on 31st March 2017.

Cash and cash equivalents till Q2FY18 were at 77,014 crore ($ 11.8 billion) compared to Rs 77,226 crore as on 31st March 2017. These were in bank deposits, mutual funds, CDs, Government Bonds and other marketable securities