Reliance Jio posts standalone profit of ₹1,350 cr in Q3 2019 with a subscriber base of 370 mn

Reliance Industries on Friday posted a record quarterly net profit of ₹11,640 crore as a turnaround in oil refining business together with the continued rise in the share of its consumer businesses of retail and telecom countered lower profitability in petrochemicals.

The oil-to-telecom conglomerate, led by Mukesh Ambani, reported a net profit of ₹11,640 crore, or ₹18.4 per share, in October-December, up from ₹10,251 crore, or ₹17.3 a share, in the same period of the previous financial year, the company said in a statement.

This is the highest quarterly net profit earned by any private company, surpassing its own previous best of ₹11,262 crore in the July-September 2019 period.

State-owned Indian Oil Corp (IOC) holds the distinction of posting the highest ever quarterly profit by any Indian firm when it had reported a net profit of ₹14,512.81 crore in January-March 2013. However, consolidated revenue fell 1.4% to ₹168,858 crore in the third quarter of 2019-20.

Reliance Jio, the group's telecom arm, posted a standalone net profit of ₹1,350 crore, which was 62.5% more than the previous year, as subscriber base swelled to 370 million.

Earning per subscriber rose to 128.4 per month from ₹120 in the previous quarter. This is the first reversal as earning per subscriber had been on a decline since the first quarter of 2018-19 when it clocked ₹134.3.

Jio crossed ₹5,600 crore quarterly EBITDA for the first time and saw a 40% data traffic growth and 30% voice growth year on year, the company said.

While oil refining margins rose after six straight quarters of decline, the company opened 415 more retail stores and added 37.1 million subscribers to its Jio mobile phone service that helped increase the profitability of the venture. But the weakness in its traditional petrochemical businesses continued.

The operator of the world's largest oil refining complex saw pre-tax earnings from the business rise 12% to ₹5,657 crore in the third quarter of the current fiscal year.

It earned $ 9.2 on turning every barrel of crude oil into fuel as compared to a gross refining margin (GRM) of $ 8.8 per barrel in the October-December 2018. The GRM was, however, lower than $ 9.4 per barrel earned in July-September 2019.

Reliance reported record pre-tax profit from its retail and telecom businesses. The two segments now account for nearly 40% of its EBITDA, up from close to 25% last financial year.

With its retail store strength rising to 11,316 from 10,901 at the end of the second quarter, the retail business posted a 58% jump in pre-tax profit to ₹2,389 crore and a 27% rise in revenue at ₹45,327 crore.

Retail is growing faster than every other player, expanding across geographies, formats and verticals. Over 176 million customers walked into its stores, 42.6% more than last year, as it now has over 26.3 million square feet of retail space spread across nearly 7,000 towns.

Despite repeating record production of 9.9 million tonnes, the petrochemical business saw pre-tax profit drop 28.5 per cent to ₹5,880 crore on fall in product prices.

Reliance's twin refineries at Jamnagar in Gujarat processed 18.1 million tonnes of crude oil, marginally higher than 18 million tonnes a year back.

Loss in the oil and gas exploration and production business widened to ₹366 crore from ₹185 crore in October-December 2018.

In August 2019, Ambani had announced plans to sell a fifth of the O2C business to Saudi Aramco for a valuation of USD 75 billion. The deal is expected to close next year.

Having completed its major investment cycle, Reliance said its outstanding debt rose to ₹306,851 crore as on December 31, 2019, from ₹291,982 crore as on September 30, 2019, and ₹187,505 crore in March-end.

Cash in hand increased to ₹153,719 crore from ₹134,746 crore at the end of the September quarter.

(With inputs from PTI)