Reliance Industries Q2 Results: Mukesh Ambani-led Reliance Industries Ltd (RIL) released its financial performance for the second quarter of the fiscal year 2024-25 (Q2FY25) on October 14. The conglomerate experienced a modest growth during the quarter, primarily due to challenges in its oil-to-chemicals (O2C) segment.
RIL posted a profit decline of 4.8 per cent on-year at Rs 16,563 crore in comparison to Rs 17,394 crore during the corresponding quarter of FY24. It posted revenue from operations at Rs 235,481 crore, marginally higher than Rs 234,956 crore posted during the second quarter of previous financial year.
During Q1, Reliance Industries had posted profit at Rs 15,138 crore, down 5.5 per cent on-year in comparison to Rs 16,011 crore posted during Q1FY24. The revenue, meanwhile, was at Rs 236,217 crore.
Earlier on Oct 7, RIL had announced that the conglomerate is scheduled to hold its board meeting on October 14 to consider and approve the standalone and consolidated unaudited financial results of the company for the quarter and half year ended September 30, 2024.
Reliance’s media business posted an operating revenue drop of 2.1 per cent, primarily due to a sharp drop in revenues of the movies segment, a project-based business.
The News portfolio revenue grew by 6 per cent driven by growth in Digital segment advertising revenue, across all brands. The TV advertising environment was soft during the quarter as advertising volumes across industry for the news genre declined by over 20 per cent on-year.
The Entertainment business recorded operating revenue decline by 5 per cent, primarily due to the drop in movie segment revenue. In Q2FY24, Viacom18 Studios had 2 big-ticket movies whereas no movies were released in the current quarter. This impact was largely offset by growth in subscription revenue on account of new pricing as well as the increased monetisation of Sports portfolio. Growth in ad revenue was primarily driven by digital, across both sports and non-sports segments.
“The Group continued to make investments in Sports and Digital, which had an impact on operating profits,” it said.
Reliance’s Oil And Gas (Exploration And Production) segment recorded Q2 revenue decline by 6.0 per cent in comparison to Q2FY24 mainly on account of lower price realisation partly offset by increase in gas and condensate volumes in KGD6 and CBM field.
The average price realized for KG D6 gas was $ 9.55/MMBTU in Q2FY25 vis-à-vis $ 10.46/MMBTU in Q2FY24. The average price realised for CBM gas was $ 11.4/MMBTU in Q2FY25 vis-à-vis $13.72/MMBTU in Q2FY24.
EBITDA, meanwhile, increased to Rs 5,290 crore, up 11.0 per cent on YoY basis. EBITDA margin was at 85.0 per cent for Q2FY25.
Reliance’s Oil to Chemicals (O2C) business recorded Q2 revenue at Rs 155,580 crore, up 5.1 per cent on-year. This, it said, was primarily on account of higher volumes and increased domestic placement of products. The segment EBITDA for Q2FY25 was lower by 23.7 per cent YoY at Rs 12,413 crore. “Unfavourable demand-supply balance led to sharp ~50 per cent decline in transportation fuel cracks and continued weakness in downstream chemical deltas,” it said.
Mukesh D Ambani, Chairman and Managing Director, Reliance Industries Limited, said, “The retail segment continues to increase its consumer touchpoints and product offerings across physical and digital channels. The unique omni-channel retail model enables the business to service a wide range of requirements of a vast, heterogenous customer base. The retail business continues to partner with renowned domestic as well as global players, expanding its basket of quality product offerings. The focus on strengthening our Retail operations will help us rapidly scale-up this business in the coming quarters and years and sustain our industry-leading growth momentum.”
Isha M Ambani, Executive Director, Reliance Retail Ventures Limited, said, “Reliance Retail continues to make investments in technology and infrastructure to build a strong foundation for future growth and maintain market leadership. We continue to strengthen our customer proposition with innovative products that spans everyday essentials to premium offerings. By continuously enhancing our assortment and innovating across categories, we are creating a shopping experience that meets the evolving needs of our customers and reinforces our leadership in the retail space.”
Reliance Retail Ventures Limited registered Q2 revenue at Rs 76,302 crore, down 1.1 per cent on-year. Per the company, growth was impacted by weak Fashion and Lifestyle (F&L) demand, continued focus on streamlining of operations and calibrated approach to B2B business to improve margins. The business vertical posted EBITDA at Rs 5,850 crore, up 0.3 per cent YoY. RIL’s retail business opened 464 new stores, taking the total store count to 18,946 with area under operation at 79.4 million sqft. The quarter recorded footfalls of over 297 million, up 14 per cent YoY. Further, the registered customer base grew to 327 million.
Mukesh D Ambani, Chairman and Managing Director, Reliance Industries Limited, said, “Growth in Digital Services was led by increased ARPU and improving customer engagement metrics reflecting the strong value proposition of our services. The home broadband segment is witnessing accelerated momentum on the back of our unique industry-leading JioAirFiber offering. Jio’s broad spectrum of offerings enables it to digitally empower every village, town and city in India as well as the country’s small and medium scale enterprises. The digital services business continues to focus on innovative deep-tech solutions on a national scale and is on track to deliver the path-breaking benefits of Artificial Intelligence to all Indians.”
Akash M Ambani, Chairman, Reliance Jio Infocomm, said, “Right from inception, Jio has focused on deep tech innovation to create customer and shareholder value. The ongoing transformation created by Jio True5G and JioAirFiber in India’s digital landscape is a testament to this approach. AI is creating the next runway for this transformation, and Jio is committed to developing the world’s best AI ecosystem in India, for all Indians. Jio is committed to delivering robust shareholder returns and has demonstrated strong uplift in financial performance in the current quarter.”
Reliance Jio posted Q2 revenue at Rs 37,119 crore, up 17.7 per cent YoY. The company EBITDA stood at Rs 15,931 crore, up 17.8 per cent on-year, led by healthy revenue growth. Reliance Jio’s operating revenue (net of GST) growth was primarily driven by partial impact of tariff hike and scale-up of home and digital services businesses.
Total subscriber base as of September 2024 was at around 479 million, up 4.2 per cent YoY.
Meanwhile, ARPU increased to Rs 195.1 with the partial follow-through of the tariff hike and a better subscriber mix. “The full impact of the tariff hike will flow through in the next 2-3 quarters,” it said.
Mukesh D Ambani, Chairman and Managing Director, Reliance Industries Limited, said, “I am happy to note that during this quarter Reliance once again demonstrated the resilience of its diversified business portfolio. Our performance reflects robust growth in Digital Services and Upstream business. This helped partially offset weak contribution from O2C business which was impacted by unfavorable global demand-supply dynamics."
Reliance Industries on Monday released its fiscal second quarter earnings with a profit decline of 4.8 per cent on-year at Rs 16,563 crore in comparison to Rs 17,394 crore during the corresponding quarter of FY24. It posted revenue from operations at Rs 235,481 crore, marginally higher than Rs 234,956 crore posted during the second quarter of previous financial year.
Capital expenditure for Q2 FY2024-25, ending June 30, 2024, stood at ₹34,022 crore ($4.1 billion).
Reliance's consolidated EBITDA for Q2 FY2024-25 slightly decreased to ₹43,934 crore ($5.2 billion). A strong performance from Digital Services was offset by weakness in the Oil-to-Chemicals (O2C) segment.
Reliance reported consolidated revenues of ₹258,027 crore ($30.8 billion) for Q2 FY2024-25, showing a slight year-on-year increase.
JM Financials forecasts a slight 0.6% QoQ increase in RIL's retail EBITDA to Rs 5,700 crore, hindered by store rationalization and heavy monsoon impacts. Analysts expect the retail segment to remain stable amid broader industry trends.
Isha Ambani, Director of Reliance Retail, aims to double the business in the next three to four years. For the fiscal year ending March 31, 2024, Reliance Retail reported gross revenue of Rs 3.06 lakh crore ($36.8 billion), up 17.8% from the previous year.
Antique Stock Broking anticipates a slight EBITDA growth of 2.8% quarter-over-quarter for RIL, largely fueled by its telecom division. The brokerage projects a 10.5% QoQ increase in telecom EBITDA, attributing this to a 6% growth in average revenue per user (ARPU), despite a stable subscriber base resulting from SIM consolidation.
Reliance Jio is expected to maintain consistent performance, with a 0.6% QoQ growth in subscribers and a 7% QoQ rise in ARPU following a recent price hike. Additionally, the retail segment is anticipated to demonstrate robust profitability.
The digital services sector is projected to grow by 10% QoQ, driven by the recent tariff adjustments. According to Nuvama Institutional Equities, Jio's EBITDA is expected to jump by 13% year-over-year and 5% quarter-over-quarter, thanks to elevated ARPU, which will help offset a 2% QoQ decline in subscriber numbers.
“HCLTech has delivered robust financial results with constant currency (CC) revenue growth at an industry leading 6.2% YoY. INR revenue reached Rs 28,862 crore, marking a sequential growth of 2.9% and a YoY growth of 8.2%. This revenue growth has come with an improved profitability. Our EBIT margins in Q2 rose to 18.6%, up 149 bps sequentially. LTM Return on Invested Capital (ROIC) stands at solid 35.7% at company level and 43.5% at Services, an expansion of 353 bps YoY and 403 bps YoY respectively. Our dedicated efforts to improve our cash conversion continue to yield best in class results, with LTM FCF/NI coming in at 119%.”
“We delivered a strong quarter with revenue growing 1.6% QoQ in constant currency and EBIT coming in at 18.6%. This growth was well distributed across verticals, geographies, and offerings. HCL Software has delivered a stellar performance of 9.4% YoY this quarter and 6.4% growth in H1 FY25 in constant currency, demonstrating the increasing relevance of our products for the digital economy. Our pipeline is very strong, including Data & AI, Digital Engineering, SAP migration and efficiency led programs. Our GenAI offerings like AI Force and AI Foundry are resonating very well with our clients and should be drivers of efficiency, growth, and innovation over the medium term.”
“We remain committed to delivering business growth in a sustainable and responsible way. We have sharpened our focus on upskilling our people in next-generation technologies to continue enabling the art of the possible for our clients. Our global community engagement footprint continues to grow.”
HCL Technologies board announced an interim dividend of Rs 12 per equity share of Rs 2 each of the company for the Financial Year 2024-25. “The Record date of October 22, 2024 fixed for the payment of the aforesaid interim dividend has been confirmed by the Board of Directors. The payment date of the said interim dividend shall be October 30, 2024,” it said in a regulatory filing.
HCL Technologies Ltd on Monday recorded its fiscal second quarter earnings with profit at Rs 4,237 crore, posting a growth of 10.5 per cent in comparison to Rs 3,833 crore during the corresponding quarter of previous year, surpassing estimates. It posted revenue from operations at Rs 28,862 crore, up 8.2 per cent as against Rs 26,672 crore during the same period of previous financial year. The company EBITDA stood at Rs 5,362 crore.
According to a CNBC TV18 poll, HCL Tech was expected to report Q2 profit at Rs 4142 crore and revenue was estimated at Rs 28,530 crore.
Sunteck Realty Ltd on Monday released its Q2FY25 business update. The company recorded pre-sales of approximately Rs 524 crore in Q2FY25, up 32.7 per cent on YoY basis. During H1, pre-sales, it added, registered a growth of 31.2 per cent YoY to around Rs 1,026 crore from Rs 782 crore in H1FY24. In terms of collections, the company recorded Rs 267 crore in Q2FY25, up 24.8 per cent on YoY basis. For H1 FY25, collections stood at approximately Rs 609 crore, posting a growth of 21.3 per cent on YoY basis.
HDFC Asset Management Company Ltd announced that the company will release its fiscal second quarter earnings on October 15. In a regulatory filing, the company said, “We wish to inform you that a conference call will be held on Tuesday, October 15, 2024 at 5.30 p.m. IST for discussing the unaudited financial results of the company for the quarter and half year ended September 30, 2024.”
Reliance Industries' EBITDA is likely to improve by 2%, and its margins may expand by 80 basis points compared to the June quarter on a sequential basis. The company's net profit is also likely to improve sequentially. Apart from the sequential improvement, the company is likely to see weakness in its retail and O2C business. However, per analysts, Reliance Jio is likely to benefit from the recent tariff hikes taken.
Per the Q1 earnings report, Reliance Jio’s total subscriber base reached to around 490 million including approximately 130 million 5G users. It has recorded around 33 per cent YoY increase in data traffic, wherein 5G accounts for over 31 per cent of Jio’s wireless data traffic. Meanwhile, per capita consumption increased to 30.3GB / month or more than 1GB / day. Further, it also said that JioFiber has driven the highest ever quarterly home connects for Jio with over 1.1 million net additions.
Sterling and Wilson Renewable Energy Ltd on Monday reported its fiscal second quarter earnings with profit at Rs 7.05 crore in comparison to a loss of Rs 54.24 crore during the corresponding quarter of previous financial year. It posted revenue from operations at Rs 1030.49 crore, up 35.7 per cent as against Rs 759.52 crore during the same period of last year. The company EBITDA stood at Rs 18.1 crore.
While its EPC business posted Q2 revenue at Rs 970.09 crore, its operation and maintenance service vertical recorded a revenue of Rs 59.74 crore during the quarter in review.
After TCS reported its Q2 earnings, Kumar Rakesh, Analyst – IT & Auto, BNP Paribas India, said, “We expected TCS to start off the earnings season on a weak note. While TCS was able to beat our below-consensus revenue growth estimates (+1.1% q-q cc, BNPPEe: 0.2%, VA consensus: 1.6%), the beat was driven by a higher-than-expected ramp up in the low-margin BSNL deal, resulting in a margin miss (24.1%, BNPPEe: 24.7%, BBG Consensus: 25.3%). Deal booking TCV improved modestly q-q to USD8.6b with a book-to-bill of 1.12 despite some large deals spilling over from 1Q. North America revenue growth again turned negative due to weakness outside of BFSI. Q-q headcount addition continued at a similar pace as in the last quarter (+0.9% q-q).”
“While the near-term outlook remains challenging on weakness in many verticals and year-end furloughs, we see q-q growth and margin picking up from 4QFY25,” he added.
Biswajit Maity, Sr Principal Analyst, Gartner, said, “TCS’s financial results indicate a decent QoQ growth of 2.6%. The growth was driven by several factors, including TCS’s strategic vision, strong execution, consulting and transformation capabilities, and strong focus on customer centricity. Gartner expects TCS to remain a strategic partner for clients, as its approach aligns well with market expectations and clients’ digital transformation goals. The new CEO’s focus on client-centricity has revitalized this strategy within TCS, generating fresh enthusiasm and a sense of urgency. Notably, TCS’s active involvement in innovation and thought leadership initiatives, such as design thinking workshops and innovation days, has further strengthened its trust-based relationships with existing clients.”
The company’s Q2 report revealed that the majority of revenue was generated from its banking, financial services, and insurance (BFSI) clients, followed by the communication, media, and technology sector, and the consumer business.
Further, Gartner raised its IT spending forecast in 2Q24 by 1.3% (from 7.6% to 8.9%), reflecting price increases in servers, devices, and software.
Based on insights from Gartner’s Forecast Analysis on Global IT Spending and TCS’s strong business pipeline, Biswajit Maity said that TCS will continue its growth trajectory in the coming quarters.
HCL Technologies is expected to announce another dividend today, for its shareholders for the current fiscal year. In the current fiscal year, the company has already announced cash rewards of Rs 12 and Rs 18 per share.
Besides RIL, IT services company HCL Technologies will also report its Q2FY25 results today, on October 14. According to a CNBC TV18 poll, HCL Tech is expected to report Q2 profit at Rs 4142 crore and revenue is estimated at Rs 28,530 crore. The company is expected to post EBIT at Rs 5162 crore. While the company had guided that the September quarter will be one of growth, but per analysts, it is likely to see a 0.8 per cent revenue headwind due to the insourcing of its joint venture with State Street.
On October 8, HCL Technologies had said in a regulatory filing, “The company will announce the second quarter FY 2025 results, ended September 30, 2024, on Monday, October 14, 2024, post-closing of Indian stock markets.