Operating profit marginally improved to Rs 26,602 crore in the January through March months despite the O2C (oil-to-chemicals) business clocking weak earnings. The company had combined its refining and petrochemicals units to form O2C.
“To me, the contributions (RIL’s help in Covid fight) are far more satisfying than our company’s strong, overall operational and financial performance for the year,” said its chairman and MD Mukesh Ambani. For the whole year of the pandemic hit 2020-21, RIL’s profit rose 35% to Rs 53,739 crore. “While Covid-19 has disrupted livelihoods, we have added nearly 75,000 jobs to the economy (during fiscal 2021),” Ambani said.
The jobs were added by RIL’s consumer business (Jio and retail), which accounted for 47% of its operating profit. In the year-ago period, Jio and retail together accounted for 36% of the company’s operating profit.
Operating profit of O2C dropped 5% to Rs 11,407 crore due to lower product sales and price realisations. But operating profit of digital services climbed 31% to Rs 8,945 crore due to an improved average revenue per user (ARPU) and higher data usage by people, while remaining sheltered at homes due to Covid. ARPU is the total revenue of the telecom operator divided by the number of users on its network.
Jio’s ARPU was Rs 138 in the March quarter, up from Rs 130 a year ago. Launched in 2016, Jio has 426 million customers and saw data and voice traffic growth of 27% and 18%, respectively, on its network.
Operating profit of retail increased 41% to Rs 3,623 crore, despite restricted normative operating conditions. This growth was enabled by doubling of consumer electronics profits, cost-management initiatives and a boost from investment income of Rs 534 crore, RIL said.
Operating profit of financial services, which the company recently started to report separately, plunged 59% to Rs 144 crore.
Oil & gas, however, turned around, with revival in KG-D6 gas production. It made an operating profit of Rs 480 crore as against an operational loss of Rs 46 crore in the year-ago period. RIL’s debt at the end of the quarter was Rs 2.51 lakh crore, but it had Rs 2.54 lakh crore in cash and cash equivalents.