By Chandini Monnappa and Sethuraman N R
(Reuters) -Indian billionaire Mukesh Ambani’s Reliance Industries reported a better-than-expected 78% surge in first-quarter profit on Friday, driven by strong growth across key businesses and gains from the sale of its stake in Asian Paints .
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 <ASPN.NS>, 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)
(Reporting by Sethuraman NR and Chandini Monnappa; Editing by Anil D’Silva and Pooja Desai)
