Reliance Industries, which is the largest company in India in terms of market value, on Friday announced its highest-ever quarterly net profit of Rs. 19,299 crore for the quarter ending in March.
The company also reported its highest-ever net profit of Rs. 66,702 crore for FY23. These impressive numbers were largely driven by the strong performance of Reliance Retail and Jio.
In Q4 FY23, RIL's revenue from operations increased to Rs. 2,12,945 crore, compared to Rs. 2,07,375 crore in the same quarter of the last year. Over the full fiscal year (April 2022 to March 2023), the revenue from operations surged by 25.87% to reach Rs. 8,79,468 crore.
The company announced a record-breaking EBITDA (earnings before interest, taxes, depreciation, and amortization) of ₹38,440 crore in Q4, which represents a 22.5% increase compared to the same quarter of the previous year.
Reliance Industries operates across four major business verticals, namely O2C, Retail, Digital Services, and New Energy.
O2C comprises the company's oil refineries, petrochemical plants, and fuel retailing operations.
Retail encompasses both brick-and-mortar stores and e-commerce channels. The digital services vertical incorporates the company's telecom arm, Jio.
In Q4 FY23, the oil refining and petrochemicals segment posted its highest-ever operating profit of Rs. 16,293 crore, reflecting a surge of 14.4%. However, the revenue for the O2C vertical dipped to Rs. 1.29 lakh crore, indicating a decline of 11.8% YoY. The operating profit margin for the segment increased by 290 basis points YoY to 12.7%.
"Revenue for Q4 FY23 reduced primarily on account of a sharp reduction in crude oil prices and lower price realisation of downstream products," the company said in its exchange filing.
In the retail vertical, the company reported a 12.9% increase in its net profit to ₹2,415 crore for the quarter that ended on March 31, 2023, led by a sustained growth momentum across consumption baskets, an increase in footfalls, and new store openings.
Reliance Retail's revenue for operations surged 21.09% to ₹61,559 crore in the fourth quarter of the last fiscal. During the quarter, Reliance Retail's grocery business grew by 66% (on a YoY basis), fashion and lifestyle by 19%, and consumer electronics (excluding devices) was up by 37%.
Reliance Retail's revenue from operations for the financial year ending March 31, 2023 increased by 32% to reach ₹2,30,931 crore compared to ₹1,74,980 crore in the previous year. Additionally, the company's net profit for FY23 was ₹9,181 crore, which reflects a spike of 30.13% compared to the previous year's net profit of ₹7,055 crore.
Reliance Retail also added 966 new stores in the March quarter, taking the total count to 18,040, and reported a 41.29% year-on-year increase in the number of footfalls at its stores to 21.9 crore.
Telecom arm Jio reported an impressive 13% YoY rise in its net profit to ₹4,716 crore in Q4FY23 from ₹4,173 crore in the same quarter last financial year, even as sequentially, the net profit rose by 1.6% from ₹4,638 crore in the quarter ended December 2022.
Revenue from operations came in at ₹23,394 crore, up 12% YoY from ₹20,901 crore in the corresponding quarter last year.
Following RIL's strong Q4 scorecard, domestic brokerage firms have maintained their bullish outlook on the stock. Brokerage firm Motilal Oswal has kept its 'buy' recommendation on the stock with a target price of ₹2,800 apiece, which reflects an upside of 19.19% from the stock's previous closing price.
Similarly, BP Equities, another domestic brokerage firm, has also maintained a 'buy' rating on the stock, with a target price of ₹2,715 per share.
On the other hand, ICICI Securities has reiterated an ‘add’ rating on the stock with a SOTP-based target price of Rs. 2,650 per share.
31 analysts polled by MintGenie on an average have a 'strong buy' call on the stock.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of MintGenie.