Ambani's Reliance tops profit estimates on asset sale gains
The profit jump was underpinned by a recovery in Reliance's core oil-to-chemicals segment, which benefited from improved refining margins and petrochemical demand. Strong performances from its retail and digital services arms also bolstered earnings.
Additionally, a sharp rise in other income, led by the sale of its stake in Asian Paints, boosted profit. The conglomerate's other income nearly quadrupled to 151.19 billion rupees in the June quarter, with 89.24 billion rupees stemming from the investment sale.
Reliance, India's biggest company by market value, in June sold a stake in Asian Paints , worth about $1.12 billion.
Reliance Retail and Jio, which together account for roughly 45% of the company's revenue, had been the engine powering the conglomerate's earnings in the six months to March, while offsetting a slowdown in the oil-to-chemicals segment, its largest revenue contributor.
Reliance's consolidated profit jumped to 269.94 billion rupees ($3.14 billion) in the June quarter, up from 151.38 billion rupees a year earlier, smashing analysts' estimate of 198.59 billion rupees, according to LSEG data.
Earnings before interest, taxes, depreciation and amortization (EBITDA) for the oil-to-chemicals business rose 10.8% to 145.11 billion rupees.
EBITDA from its Jio Platforms rose 23.9% year-on-year, the strongest growth among its segments, while retail EBITDA increased 12.7%.
Jio Infocomm, its telecom unit, logged a 23.3% rise in net profit, while revenue rose 16.6%.
The company said it was on track to set up its planned "giga factories" in the next four-to-six quarters and that, once operational, the business would be self-sustaining, without requiring further investment from Reliance.
Reliance, which operates the world's largest refining complex in Jamnagar, Gujarat, announced a $10 billion investment in 2021 to build its green energy portfolio and achieve net-zero carbon emissions by 2035.
($1 = 86.0620 Indian rupees)
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Reuters
29 minutes ago
- Reuters
India's HDFC Bank reports 12.2% profit growth in Q1 due to higher interest income
July 19 (Reuters) - HDFC Bank ( opens new tab, India's largest private bank by market capitalisation, reported higher-than-expected quarterly profit on Saturday due to a surge in interest income from loans and treasury gains, even as provisions for bad loans spiked. The bank's standalone net profit rose 12.2% to 181.55 billion rupees ($2.11 billion) in the April-to-June quarter, above the average analyst forecast of 172.84 billion rupees, according to data compiled by LSEG. The bank's net interest income - the difference between interest earned on loans and paid on deposits - rose 5.4% to 314.38 billion rupees. Other income, typically backed by treasury gains and fees on services, more than doubled to 217.29 billion rupees in the quarter. HDFC Bank's provisions for bad loans, however, jumped five-fold to 144 billion rupees. The bank, in its exchange filing, said most of these provisions were not linked to any actual bad loans but instead acted as a "countercyclical buffer for making the balance sheet more resilient." Indian lenders have been grappling with an increase in bad loans in segments such as microfinance and unsecured portfolio, which have forced them to set aside more funds for potential defaults and to strengthen their balance sheets. On Thursday, HDFC Bank peer Axis Bank ( opens new tab saw its new bad loans double due to a market benchmarking exercise. While overall bank credit growth has slowed in India, HDFC Bank posted growth of 6.7% for its overall loan book, driven by a 17.1% rise in loans to small and medium businesses. The private lender also approved its first ever bonus share issue on Saturday, meaning each of its shareholders will be eligible to receive an extra bonus share for every share held. The date of issuance is still to be determined, the bank said. In a bonus issue, a company distributes additional stock to shareholders as a proportion of their holdings at no cost. It is typically a sign of confidence in financial performance and growth trajectory. The board has also approved a special dividend of 5 rupees per share. ($1 = 86.1450 Indian rupees)
Reuters
29 minutes ago
- Reuters
India's ICICI Bank reports 15.5% profit growth in Q1 helped by higher core lending income
July 19 (Reuters) - ICICI Bank ( opens new tab, India's second-largest private lender by market capitalisation, beat quarterly profit forecasts on Saturday, helped by healthy loan growth resulting in higher core lending income. The bank's standalone net profit rose 15.5% to 127.68 billion Indian rupees ($1.48 billion) in the April-to-June quarter, above the average analyst forecast of 120.24 billion rupees, according to data compiled by LSEG. Net interest income increased by 10.6% year-on-year to 216.35 billion rupees in the quarter. While credit growth has slowed across the industry, ICICI Bank posted 12% growth in its loan book, driven mainly by a 29.7% rise in loans to businesses. ICICI Bank's net interest margin, a key gauge of profitability, fell to 4.34%, from 4.36% a year earlier and 4.41% in the previous quarter, due to the Indian central bank's recent rate cut actions. When rates are lowered, lenders typically pass on the advantage to borrowers first and only later cut deposit rates, which temporarily squeezes their margins. ICICI's asset quality, meanwhile, improved, with the gross non-performing assets ratio at 1.67% at the end of June, versus 2.15% in the same period last year. Indian lenders have kept a tight lid on unsecured lending, after grappling with higher bad loans in the segment, a move that has supported asset quality. ICICI Bank's provisions for bad loans rose 36.2% year-on-year to 18.15 billion rupees. ($1 = 86.1450 Indian rupees)
Reuters
2 hours ago
- Reuters
China vows tougher action against smuggling of strategic minerals
SHANGHAI, July 19 (Reuters) - China vowed on Saturday to step up a crackdown and toughen law enforcement against smuggling of strategic minerals seen as vital to national security and critical for development. The remarks by the commerce ministry came a day after the state security ministry accused foreign spy agencies of having tried to "steal" rare earths and pledged to crack down on infiltration and espionage targeting the critical sector. The world's largest supplier of dozens of strategic minerals, China began imposing export curbs in 2023 on supplies vital to sectors ranging from chipmaking and the energy transition to defence. The commerce ministry remarks, describing smuggling and export of strategic minerals as a severe problem to be combated, came at a meeting of officials responsible for export control coordination and other government bodies. "Cases of smuggling by a small number of criminals for their own selfish interests and collusion between domestic and foreign parties are still occurring," it said in a statement. Evasive methods such as false declarations and third-country transshipment were taking on increasingly covert forms, it added, urging government bodies to prevent illegal outflows of strategic minerals and related technologies. China has adopted a "zero-tolerance" approach to smuggling and export of strategic minerals, which it will fight with a heavy hand, through special efforts to toughen law enforcement, the ministry said. In May China said it would strengthen controls on the entire supply chains of strategic mineral exports while tightening its grip on materials deemed crucial to national interest. Earlier, Beijing launched a special campaign to tackle smuggling of strategic minerals such as gallium, germanium, antimony, tungsten and some rare earths.
