Reliance Q4 net plunges 39% to 6,348 crore

Mumbai: Oil-to-telecom major Reliance Industries on Thursday reported a 38.73 per cent year-on-year (YoY) fall in consolidated net profit at Rs 6,348 crore for the fourth quarter ended March 31.

The consolidated profit in the previous quarter was Rs 11,640 crore and in the corresponding quarter last year, it was Rs 10,362 crore.

The company's bottomline was hit by an exceptional loss of Rs 4,267 crore due to fall in oil prices and demand destruction post Covid-19, but healthy growth in Reliance Jio limited the profit decline. Consolidated revenue from operations for the March quarter declined 11.1 per cent sequentially to Rs 1,36,240 crore, and the year-on-year fall in revenue was 2.4 per cent.

While explaining the reason for exceptional loss, Reliance said, "In respect to refining and Petrochemicals business, the company has determined the non-cash inventory holding losses in the energy businesses due to dramatic drop in oil prices accompanied with unprecedented demand destruction due to Covid-19 and the same has been disclosed as exceptional items."

RIL said the fallout of Covid-19 outbreak on economic activity disrupted businesses across manufacturing and services sectors during the quarter. Global oil markets witnessed significant volatility on account of demand destruction and excess supplies. Lockdowns and travel restrictions in most geographies led to steep fall in transportation fuel demand.

Mukesh Ambani, Chairman and Managing Director, Reliance Industries, however said: "Despite the daunting challenges arising from the fallout of the global pandemic, our company has once again delivered a resilient performance for FY20. We continue to operate all our major facilities at near normal utilisation levels".

Reliance Jio Infocomm, RIL's telecom arm, posted a robust 177.50 per cent YoY growth in net profit at Rs 2,331 crore. Its subscriber base went up by 26.30 per cent to 387.50 million from a year ago, with each user spending an average of Rs 130.60 a month during the quarter.

"Jio is embarking on the next leg of growth with a path-defining partnership with one of the world's largest digital companies, Facebook," said Ambani.