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Reliance Industries Limited (RIL) announced stellar financial results for the third quarter of fiscal year 2025 (Q3 FY25), reporting a record-high consolidated net profit. The company's impressive performance, a 12 percent year-on-year increase to ₹21,930 crore, was primarily driven by exceptional growth in its digital services and retail businesses. This robust financial outcome underscores RIL's strategic diversification and its ability to capitalize on emerging market trends. The consolidated revenue also witnessed a significant surge, climbing 7.7 percent to ₹2.67 lakh crore compared to the same period last year. Similarly, the EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) experienced a healthy 7.8 percent rise, reaching ₹48,003 crore, with the EBITDA margin expanding by 10 basis points to 18 percent, signaling improved operational efficiency.
The digital services division, spearheaded by Jio Platforms, emerged as a key growth driver. Its EBITDA soared by an impressive 17 percent to ₹16,640 crore, fueled by a higher average revenue per user (ARPU) of ₹203.3. This increase in ARPU reflects not only a rising subscriber base but also a significant uptick in customer engagement and a shift towards higher-value 5G plans. Jio's aggressive expansion of its 5G network, boasting 170 million True5G subscribers contributing 40 percent of the company's wireless traffic, is a testament to its success in capturing market share and providing advanced connectivity services. The continued 5G subscriber addition and expansion and anticipated gains from recent tariff hikes position Jio for sustained growth in the coming quarters. Mukesh Ambani, Chairman and Managing Director of Reliance Industries, highlighted the robust growth in the digital services business driven by sustained subscriber additions and improved customer engagement, bolstered by the increasing number of users upgrading to 5G.
The retail segment also performed exceptionally well, contributing significantly to the overall success. Its EBITDA increased by 9 percent to ₹6,840 crore, reflecting strong consumer demand, particularly during the festive season. This performance showcases the resilience of the retail sector and RIL's ability to effectively cater to changing consumer preferences. The opening of 779 new stores during the quarter, bringing the total number of stores to 19,102, covering an operational area of 77.4 million sq ft, demonstrates RIL's commitment to expanding its retail footprint and reaching a wider customer base. The retail arm also saw a significant increase in footfall, indicating strong customer engagement and brand loyalty. The company's focus on digital commerce and new commerce continues to contribute to its overall revenue, underscoring the effectiveness of integrating online and offline shopping experiences. Isha Ambani, Executive Director of Reliance Retail Ventures Limited, highlighted the strong performance driven by festive buying, emphasizing the company’s focus on offering a wide range of products at attractive prices.
The oil-to-chemicals (O2C) segment also played a crucial role in RIL's overall financial performance. Revenue for this segment increased by 6 percent to ₹1.49 lakh crore, demonstrating the strength of the domestic demand and increased production volumes. While the oil and gas division experienced a 4 percent decline in EBITDA due to lower KG-D6 gas field production, this was partially offset by increased CBM gas volumes and a marginal increase in KG-D6 gas prices. The O2C segment's steady performance further highlights the diversification of RIL's business portfolio, mitigating risks associated with reliance on a single sector. The company's capital expenditure for the quarter stood at ₹32,259 crore, significantly covered by a cash profit of ₹38,227 crore, demonstrating its strong financial position and capacity for continued investment in growth opportunities. Overall, RIL's Q3 FY25 results reflect a strong performance across its key verticals, showcasing its success in strategically managing its diverse business portfolio and leveraging opportunities in the rapidly evolving market landscape.
Looking ahead, RIL is well-positioned for continued growth, driven by its strong performance across various business segments. The success of Jio's 5G expansion, the robust performance of the retail sector, and the steady performance of the O2C segment, all point to a promising outlook for the company. The company's significant investments in infrastructure, technology, and expansion strategies are expected to further fuel its future growth. However, the company should carefully consider factors such as global economic conditions, geopolitical instability, and potential regulatory changes, which could affect its future performance. Despite these potential challenges, RIL's diversified business model and strong financial position provide it with a robust foundation for navigating uncertainty and achieving its long-term growth objectives. The company's continued focus on innovation, customer engagement, and strategic expansion will be vital in maintaining its leading position in the market.
Source: Reliance Industries Q3 net profit rises 12% to record high, boosted by digital, retail businesses