Reliance Industries reported a good set of numbers for Q1FY20. The consolidated revenue grew by 21.9% yoy and 13.2% qoq to Rs1,56,976cr against median consensus estimates of Rs1,47,335cr. EBITDA came in Rs21,315cr, up 3.2% yoy and 2.3% qoq against median estimate of Rs19,971cr. EBITDA margin contracted by 247bps yoy and 145bps qoq to 13.6%, which is in-line with the estimates. PAT grew by 6.8% yoy but declined by 2.5% qoq to Rs10,104cr against median consensus estimates of Rs9,520cr.
Revenue growth was on the back of 6.4% yoy and 15.8% qoq growth in refining revenues on higher throughput. GRM for Q1FY20 stood at USD8.1/bbl, outperforming Singapore complex margins by USD4.6/bbl. Lower product cracks on yoy basis resulted in EBIT margin contracting by ~120bps on yoy basis to 4.4%.
Refinery throughput was higher by 5.4% yoy and 9.4% qoq to 17.5MMT.
As expected, Petchem revenue declined by 6.6% yoy and 11.3% qoq. This was due to decrease in volumes and price realizations primarily in Paraxylene (PX) and Monoethylene Glycol (MEG), which was partially offset by increase in volumes of Polyesters.
Petchem production was down by 5.4% yoy and 7.4% qoq.
Oil & Gas segment decreased by 35.5% yoy. Domestic production was lower at 11.6 BCFe, down 35% yoy and production in US Shale operations also declined by 34% to 18.9 BCFe.
Retail revenue continues to grow at healthy pace, up 47.5% yoy and 4.2% qoq. EBITDA grew by 69.9% yoy and 6.6% qoq to Rs2,049cr. Margins expanded by 71bps yoy and 12bps qoq to 5.4%.
Area operated grew by 23.7% yoy and 4.5% qoq to 23mn sq ft. Rapid store expansion particularly in Tier 3/ Tier 4 markets, stronger value proposition and catchment focused assortment have been key drivers for robust growth in retail business.
Digital/Jio revenues were up 54.5% yoy and 9.6% qoq. Segmental EBITDA grew by 8.2% qoq to Rs4,686cr. EBITDA margin came in at 40.1%. Subscriber base as on June 30, 2019 was 331.3mn. ARPU during the quarter was Rs122 per subscriber per month.
RIIHL, W.O. Subsidiary, has entered into an agreement with Brookfield Infrastructure Partners L.P. and its affiliates for an investment of Rs25,215cr into Tower InvIT.
Reliance Industries Ltd is currently trading at Rs. 1,248.30, down by 13.5 points or 1.07% from its previous closing of Rs. 1,261.80 on the BSE.
The scrip opened at Rs. 1,268.25 and has touched a high and low of Rs. 1,271 and Rs. 1,243 respectively. So far 72,48,225 (NSE+BSE) shares were traded on the counter. The stock is currently trading above its 100 DMA.
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