Reliance Retail Q3 net muted on FMCG demerger, GST rate cuts

Reliance Retail on Friday reported its slowest profit growth in five quarters for the October-December (Q3FY26) period, at 2.7% year-on-year (yoy) to Rs 3,551 crore, hurt by a split in festive season spending over two quarters. A demerger of the fast-moving consumer goods business under Reliance Consumer Products, which was effective December 1, and GST rate cuts, also contributed to the muted profit growth, the company said in a post-results earnings call.

Q3 gross revenue at Rs 97,065 crore, grew 8.1% yoy and was the highest-ever for the company. At the net level though, Q3 revenue while coming in at 9.2% yoy at Rs 86,951 crore, was still the slowest in four quarters. Q3 earnings before interest tax depreciation and amortisation (Ebitda) growth came in at 2.1% yoy, slowest in five quarters, at Rs 6,770 crore.

FMCG Demerger

Ebitda margins slipped 50 basis points to 7.8% in Q3 versus 8.3% reported a year ago, impacted by festive offers and promotions, investments in hyper-local commerce and a one-impact of the new Labour Code, Dinesh Taluja, CFO, Reliance Retail said in the earnings call.

The demerged FMCG business, on the other hand, grew 1.6 times versus last year in Q3, touching Rs 5,065 crore, led by brands such as Campa, Campa Energy and Independence. For the first nine months of FY26, the FMCG business’s gross revenue touched Rs 15,000 crore, growing 1.8 times versus last year.  The FMCG business also acquired global rights to Brylcreem, Toni & Guy, Badedas and Matey, it said.

Mukesh Ambani, chairman and managing director, Reliance Industries, said, “Our retail business had an eventful quarter, strengthening its portfolio with the onboarding of new brands and product ranges. The demerger of the consumer products business came into effect this quarter. With a broad and diverse product basket, the consumer products vertical is progressing on its accelerated growth trajectory.”

During the quarter, Reliance Retail opened 431 new stores, taking its total store count to 19,979 with a total area of 78.1 million square feet. In the quarter ended December, its finance cost was down 13.2%  yoy to Rs 578 crore. The company’s registered customer base grew to 378 million, making Reliance Retail one of the most preferred retailers in the country, it said.

Its grocery business performance was primarily led by a pick-up in festive demand, with like-for-like (LFL) growth of 6%, and it witnessed continued growth across categories. Dairy, frozen and bakery grew by 23%, staples rose by 19%, and packaged food was up by 15% versus last year.

JioMart and Digital Commerce

JioMart maintained its footprint of over 5,000 pin codes and more than 1,000 cities, serviced by a network of over 3,000 stores. It also continued to add dark stores and reduced the average delivery distance per order. The platform crossed exit daily orders of 1.6 million and recorded 53% quarter-on-quarter (Q-o-Q) and over 360% year-on-year growth in average daily orders, establishing itself as the fastest-growing player in hyperlocal commerce, the company said.

In fashion and lifestyle, Reliance Retail maintained steady performance, supported by festive demand and seasonal assortment execution, partially impacted by festive demand split across Q2 and Q3.

Ajio delivered consistent growth throughout the period, driven by promotions and festive buying, resulting in an average basket value increase of 21% yoy, it said. Shein continued to scale, with app installs exceeding 6.5 million and a twofold expansion of the product portfolio to over 50,000 options. Reliance Retail also entered into an exclusive partnership with Fabletics, an American women’s athleisure brand, during the quarter.

In consumer electronics, Reliance Digital stores delivered strong growth led by year-end campaigns and GST-led price resets for air conditioners and televisions, with LFL growth of 11%. Performance across key categories saw double-digit year-on-year growth, with laptops increasing by 46%, mobiles by 38%, televisions by 25%, and appliances by 19%.

The jewellery business saw strong performance driven by festive and wedding-related demand, resulting in a 73% year-on-year increase in average bill value.