RIL slips over 2.5% ahead of Q1 results; here's what to expect from oil-to-telecom behemoth

RIL Q1 preview: Shares of Reliance Industries (RIL) ended nearly 2.50 per cent lower at Rs 2,555 apiece on the NSE ahead of its June quarter results announcement, due later today. In the previous session, the domestic stock exchanges, NSE and BSE, conducted a one-hour special session for RIL to discover the price of its demerged entity, Jio Financial Services, which is expected to list on the bourses in the next 2-3 months.

Jio Financial Services (JFS) has been valued at around $20 billion after its stock price was set at a much higher-than-expected Rs 261.85 ($3.19) in its demerger from RIL.

JFS' stock price is higher than analysts' estimates of Rs 160 to Rs 190. Stockholders will get one JFS share for each Reliance share they hold.

"This shows people are quite confident about the future performance of JFS with exposure to Jio's mobile customer base. It also holds nearly 1 trillion rupees of Reliance's treasury shares. These factors have given a lot of confidence to investors," Reuters quoted G. Chokkalingam, founder and head of research at Equinomics, as saying.

Reliance Industries Q1: What analysts expect

According to Zee Business Research, the company's oil-to-chemicals (OTC) segment is likely to see a drop in gross revenue margin (GRM) during the quarter owing to a 5 per cent quarter-on-quarter (QoQ) fall in crude oil prices. Due to this, the Singapore gross refining margin (SGRM) has declined 50 per cent QoQ.

RIL's other verticals, such as GAS, Retail, and Telecom, are expected to post healthy growth. Reliance Retail's earnings before interest, tax, depreciation, and amortisation (EBITDA) are expected to see growth between 20 and 25 per cent on a year-on-year (YoY) basis. Further, an increase in footfalls will aid Reliance Retail's financials, the research desk said.

As regards RIL's telecom arm, Reliance Jio, the company's EBITDA is expected to remain flat, while ARPU (average revenue per user) is expected to see a slight fall on the base of Rs 178.8.

Reliance Q1 preview: Key numbers

The Mukesh Ambani-led company is expected to see a 2.5 per cent QoQ rise in its consolidated revenue at Rs 2,18,300 crore against Rs 2,12,945 crore logged in the March 2023 quarter. EBITDA is seen declining 2.5 per cent to Rs 37,460 crore as compared to Rs 38,440 crore logged in the year-ago period. EBITDA margin is seen at 17.1 per cent against 18 per cent in the previous quarter, and finally, net profit is expected to decline 12.4 per cent QoQ to Rs 16,900 crore.