Reliance Industries’ September-quarter profit fell 15 per cent as the coronavirus crisis hammered its dominant oil business, although the conglomerate reaped double-digit revenue growth at its Jio telecom service. Led by Asia’s richest man Mukesh Ambani, Reliance Industries has in recent years built massive retail and telecom businesses to tap into the country’s consumer boom and reduce its dependence on the energy sector.
Reliance Industries said on Friday that its consolidated profit slipped to Rs 9,567 crore ($1.29 billion) in the three months to September 30 from Rs 11,262 crore a year earlier. Analysts on average had expected Rs 8,548 crore, Refinitiv data showed.
Refining revenue plunged 36 per cent, said Reliance Industries, which operates the world’s biggest oil refining complex. Petrochemicals revenue fell 23 per cent.
Oil demand has collapsed as the COVID-19 pandemic disrupts global travel and business, hurting sales of refined products such as gasoline, diesel and jet fuel.
Its gross refining margin – the profit earned on each barrel of crude oil processed – slumped to $5.7 per barrel, lower than the $6.3 in the previous quarter and the $9.4 a year earlier.
Meanwhile, Reliance Industries’ Jio telecom unit – India’s largest by customers – continued to be a bright spot as revenue surged 33 per cent and the number of subscribers surged past 400 million.
Jio is part of Reliance Industries’ digital arm, which has raised more than $20 billion since April, with about half coming from Facebook and Google.
Reliance Industries’ retail division that sells everything from groceries to apparel suffered a 4.9 per cent drop in revenue as the health crisis kept shoppers away. Still, the decline was less worse than the 17 per cent fall recorded in the previous quarter.
Overall, revenue from operations for Mumbai-headquartered Reliance Industries slid 24 per cent to Rs 1.16 lakh crore.