RIL profit drops as refining biz falters

Telecom, retail businesses continue to deliver strong growth

- Ujjval Jauhari

Reliance Industries Ltd said quarterly profit declined 5.9% from a year earlier, missing analysts’ estimates, due to the weak performance of its chemicals and refining business.

Net profit fell to ₹18,258 crore in the three months ended 30 June from ₹19,405 crore in the year-ago quarter. Profit missed the average ₹18,302 crore estimated by a Bloomberg survey of analysts.

Revenue declined by 5.31% to ₹2.1 trillion, in line with estimates.

While the company’s oil-to-chemicals (O2C) business reported weak performance, the consumer-centric retail and telecom businesses reported robust earnings. The O2C business’s earnings declined due to a sharp decline in fuel cracks, the difference between the prices of crude oil and refined products, in the June quarter from exceptionally high levels, the company said.

The segment’s revenue fell 17.7% from a year earlier to ₹1.33 trillion. However, it rose 3.4% sequentially.

Demand was impacted by destocking on recessionary fears and high interest rates, as well as slower than expected growth in the China market, said the company.