Reliance Industries Limited Q3 FY24 Earnings Conference Call Insights

Key highlights from Reliance Industries Limited (RELIANCE) Q3 FY24 Earnings Concall

• Financial Performance
  • Consolidated EBITDA at INR 44,700 crores, up 17% year-on-year.
  • Net profit at INR 19,641 crores, up 11% year-on-year.
  • Growth led by strong performance in Retail and Oil and Gas businesses.
  • Digital Services steady with 1% increase in O2C.
  • Resilient O2C performance despite major planned maintenance shutdown and weak downstream margin environment.
• Retail Growth
  • Revenue up 23% and EBITDA up 31% demonstrating operating leverage.
  • 21% higher area operated at nearly 73 million square feet.
  • 40% higher footfalls and addition of 252 stores, totaling 1,549 store adds over past year.
  • Fast growth of Digital and New Commerce at 19% of total revenues.
  • Broad-based growth seen across Grocery, Fashion & Lifestyle and Consumer Electronics.
• Oil and Gas Production
  • Best ever quarterly EBITDA of INR 5,804 crores in Oil and Gas business.
  • KGD6 production up 73%, now at 30 MMSCMD.
  • KGD6 contributes 30% of India’s gas production.
  • Higher KGD6 production driving 50% increase in Oil and Gas revenue and EBITDA.
• 5G Network Rollout
  • Completed true 5G network rollout across India ahead of schedule.
  • 90 million subscribers have migrated to 5G network.
  • 5G availability 3x and download speeds 2x of nearest competitor.
  • Subscriber growth at 7.5% vs industry flat at 0.7% showing 5G driving growth.
  • Net port-ins 2.5x of competitor.
• Subscriber Base Growth
  • Added 11.2 million net new customers this quarter and 38 million for the year.
  • Total subscriber base reached 471 million.
  • 5% increase in data usage year-over-year driven by 5G rollout.
  • Rural subscriber growth now 5.5x of nearest competitor after JioBharat launch.
  • JioBharat gaining 45% market share in sub-INR 1,000 price segment since launch.
  • 60% of UPI transactions from low-end handsets coming from JioBharat users.
• JioBharat Performance
  • Accelerating migration from 2G to 4G with JioBharat device.
  • Priced similarly or cheaper than 2G phones to target captive 2G base.
  • Seeing strong engagement metrics like live TV and UPI payments from users.
  • Driving 5.5x higher rural subscriber additions relative to competitors.
• Enterprise Business Growth
  • Over 80% of large enterprises now Jio customers.
  • 33% of large enterprises using 2+ Jio services beyond just connectivity.
  • 50% higher number of accounts contributing over INR 5 crores in revenues.
  • Non-network services driving 20% of recent deal wins highlighting growth of digital services.
• New Digital Services
  • Showcased new solutions in cloud compute, satellite connectivity, gaming, health care and more.
  • Cloud gaming to expand gaming market by removing need for expensive consoles.
  • Private 5G allows large campuses to have dedicated 5G installation.
  • Managed services to provide advisory, implementation and management of digital services.
• JioAirFiber Expansion
  • Rapidly expanding JioAirFiber across India by leveraging 5G network.
  • Seeing encouraging customer engagement and usage levels early on.
  • Per capita usage around 30x higher than even for wireline fiber services.
• Grocery Business Growth
  • Record footfalls and highest ever single day sale during festival season.
  • Growing non-food categories to improve margins.
  • Adding more categories to become one-stop destination.
• Fashion Initiatives
  • Azorte, Yousta and Swadesh formats showing strong response and scaling up.
  • AJIO added 1.6 million new customers and grew option count by 38%.
  • Launched niche site Ajio Luxe and AjioGram for D2C brands.
• Outlook
  • Gas prices pulled back slightly due to lower ceiling price and weak global demand.
  • Milder winter in Europe resulting in higher inventories and lower LNG demand.
  • Short term prices to depend on winter severity, some positive signs in China and Southeast Asia demand.
  • Growth expectations to moderate from the high 30% levels seen in recent quarters.
  • Seeing revenue growth and margin expansion across Jio, Retail and O2C.
  • Strong domestic consumer and energy demand outlook.