Reliance net profit drops 5% during Q1

New Delhi: Reliance Industries Ltd, India's most valuable company, on Friday reported a 5 per cent drop in its June quarter net profit as lower fuel cracks and petrochemical margins outdid gains in telecom and retail businesses. The oil-to-retail-to-telecom conglomerate's consolidated net profit was at Rs 15,138 crore, or Rs 22.37 per share, in April-June - the first quarter of the current 2023-24 fiscal year - compared to Rs 16,011 crore, or Rs 23.66 a share, earnings a year back, according to a company's statement.

The net profit was also 20 per cent lower quarter-on-quarter when compared to the record Rs 18,951 crore earnings in the preceding three months ended March 31. Besides lower transportation fuel cracks or margins, particularly that of petrol which was down 30 pre cent, and reduced chemical margins, Reliance also had a higher outgo on depreciation cost, hurting profitability.

Company’s revenue from operations were up 11.5 per cent to Rs 2.57 lakh crore from Rs 2.31 lakh crore in the year-ago period but were lower than Rs 2.64 lakh crore in January-March 2024.

The firm helmed by billionaire Mukesh Ambani continued to post an uptick in consumer businesses of retail and telecom. While Jio pole-vaulted to becoming the largest telecom operator globally in terms of data tariff as 5G propelled usage, the retail business delivered steady performance due to increase in footfalls at its expanded store network. Depreciation/amortisation expenses were up 15.5 per cent to Rs 13,596 crore due to expanded asset base across all businesses, while there was also a marginal rise in finance cost.