Reliance Q1 profit falls 22% despite 25% jump in revenue. Here's why
Reliance Industries posted a 22% drop in first-quarter net profit even as revenue rose sharply.
Mukesh Ambani-led Reliance Industries Ltd (RIL) reported a 22% year-on-year fall in its consolidated net profit for the April-June quarter, even as the company posted strong growth in revenue.
Reliance's net profit stood at Rs 20,946 crore in the first quarter of FY27, compared with Rs 26,994 crore in the same period last year. However, the decline does not reflect weaker business performance. It was mainly due to an exceptional gain recorded in the year-ago quarter from the sale of the company's stake in Asian Paints.
WHY DID PROFIT FALL?
The main reason for the drop in profit was the high base created by last year's one-time gain from the Asian Paints stake sale. Without that exceptional item, the comparison would have looked different.
Despite the lower profit, the company reported healthy growth across its businesses during the quarter.
REVENUE AND OPERATING PERFORMANCE IMPROVE
Revenue from operations rose 25% year-on-year to Rs 3.11 lakh crore, up from Rs 2.48 lakh crore in the corresponding quarter last year.
Reliance's earnings before interest, tax, depreciation and amortisation (EBITDA) also increased 10% to Rs 54,067 crore, reflecting stronger operating performance.
Commenting on the results, Reliance Chairman and Managing Director Mukesh Ambani said the company had made a steady start to FY27, with all its businesses delivering strong operating performance despite continuing geopolitical tensions and volatile commodity markets. He added that the group's diversified business portfolio continued to demonstrate resilience.
HIGHER COSTS DURING THE QUARTER
Depreciation rose 9% year-on-year to Rs 15,100 crore, mainly because of higher depreciation in the Digital Services business after the capitalisation of 5G assets.
Finance costs also increased 18% to Rs 8,337 crore, largely due to higher liability balances and the capitalisation of 5G assets.
CONTINUED INVESTMENT IN GROWTH
Reliance's capital expenditure during the June quarter stood at Rs 38,682 crore.
The company said it continues to make significant progress on projects in its Oil-to-Chemicals (O2C) and New Energy businesses. It is also investing in expanding its consumer businesses by strengthening infrastructure and increasing its reach.
While the one-time gain from last year weighed on the profit comparison, Reliance continued to report strong revenue growth and steady operating performance during the first quarter of FY27.
Mukesh Ambani-led Reliance Industries Ltd (RIL) reported a 22% year-on-year fall in its consolidated net profit for the April-June quarter, even as the company posted strong growth in revenue.
Reliance's net profit stood at Rs 20,946 crore in the first quarter of FY27, compared with Rs 26,994 crore in the same period last year. However, the decline does not reflect weaker business performance. It was mainly due to an exceptional gain recorded in the year-ago quarter from the sale of the company's stake in Asian Paints.
WHY DID PROFIT FALL?
The main reason for the drop in profit was the high base created by last year's one-time gain from the Asian Paints stake sale. Without that exceptional item, the comparison would have looked different.
Despite the lower profit, the company reported healthy growth across its businesses during the quarter.
REVENUE AND OPERATING PERFORMANCE IMPROVE
Revenue from operations rose 25% year-on-year to Rs 3.11 lakh crore, up from Rs 2.48 lakh crore in the corresponding quarter last year.
Reliance's earnings before interest, tax, depreciation and amortisation (EBITDA) also increased 10% to Rs 54,067 crore, reflecting stronger operating performance.
Commenting on the results, Reliance Chairman and Managing Director Mukesh Ambani said the company had made a steady start to FY27, with all its businesses delivering strong operating performance despite continuing geopolitical tensions and volatile commodity markets. He added that the group's diversified business portfolio continued to demonstrate resilience.
HIGHER COSTS DURING THE QUARTER
Depreciation rose 9% year-on-year to Rs 15,100 crore, mainly because of higher depreciation in the Digital Services business after the capitalisation of 5G assets.
Finance costs also increased 18% to Rs 8,337 crore, largely due to higher liability balances and the capitalisation of 5G assets.
CONTINUED INVESTMENT IN GROWTH
Reliance's capital expenditure during the June quarter stood at Rs 38,682 crore.
The company said it continues to make significant progress on projects in its Oil-to-Chemicals (O2C) and New Energy businesses. It is also investing in expanding its consumer businesses by strengthening infrastructure and increasing its reach.
While the one-time gain from last year weighed on the profit comparison, Reliance continued to report strong revenue growth and steady operating performance during the first quarter of FY27.
Mukesh Ambani-led Reliance Industries Ltd (RIL) reported a 22% year-on-year fall in its consolidated net profit for the April-June quarter, even as the company posted strong growth in revenue.
Reliance's net profit stood at Rs 20,946 crore in the first quarter of FY27, compared with Rs 26,994 crore in the same period last year. However, the decline does not reflect weaker business performance. It was mainly due to an exceptional gain recorded in the year-ago quarter from the sale of the company's stake in Asian Paints.
WHY DID PROFIT FALL?
The main reason for the drop in profit was the high base created by last year's one-time gain from the Asian Paints stake sale. Without that exceptional item, the comparison would have looked different.
Despite the lower profit, the company reported healthy growth across its businesses during the quarter.
REVENUE AND OPERATING PERFORMANCE IMPROVE
Revenue from operations rose 25% year-on-year to Rs 3.11 lakh crore, up from Rs 2.48 lakh crore in the corresponding quarter last year.
Reliance's earnings before interest, tax, depreciation and amortisation (EBITDA) also increased 10% to Rs 54,067 crore, reflecting stronger operating performance.
Commenting on the results, Reliance Chairman and Managing Director Mukesh Ambani said the company had made a steady start to FY27, with all its businesses delivering strong operating performance despite continuing geopolitical tensions and volatile commodity markets. He added that the group's diversified business portfolio continued to demonstrate resilience.
HIGHER COSTS DURING THE QUARTER
Depreciation rose 9% year-on-year to Rs 15,100 crore, mainly because of higher depreciation in the Digital Services business after the capitalisation of 5G assets.
Finance costs also increased 18% to Rs 8,337 crore, largely due to higher liability balances and the capitalisation of 5G assets.
CONTINUED INVESTMENT IN GROWTH
Reliance's capital expenditure during the June quarter stood at Rs 38,682 crore.
The company said it continues to make significant progress on projects in its Oil-to-Chemicals (O2C) and New Energy businesses. It is also investing in expanding its consumer businesses by strengthening infrastructure and increasing its reach.
While the one-time gain from last year weighed on the profit comparison, Reliance continued to report strong revenue growth and steady operating performance during the first quarter of FY27.
