Reliance Industries Ltd, one of India’s largest business conglomerates, reported a 7.7 percent increase in net profit for the October-December 2024 quarter, driven by strong performances in its oil-to-chemicals (O2C), digital services, and retail businesses. Consolidated profit before tax (PBT) for the quarter rose by 11 percent, while profit after tax (PAT) jumped by 12 percent, despite challenges in exports due to global economic and geopolitical uncertainties.
The company’s consolidated revenue rose to Rs 267,186 crore for the October-December 2024 quarter, compared to Rs 248,160 crore in the corresponding quarter of the previous year. In the sequential previous quarter, the total consolidated turnover stood at Rs 258,027 crore. The company’s PBT for the quarter was Rs 28,643 crore, up from Rs 25,833 crore in the same quarter of the previous year and Rs 25,037 crore in the sequential quarter of 2024.
Despite a 6.7 percent rise in finance costs and a 2.2 percent increase in depreciation, RIL’s net profit (PAT) rose to Rs 21,804 crore in the October-December 2024 quarter, compared to Rs 19,488 crore in the corresponding quarter of the previous year. On a nine-month basis ending December 31, 2024, RIL reported a total net profit of Rs 58,353 crore, compared to Rs 57,490 crore during the same period of the previous year.
Commenting on the results, Mukesh D. Ambani, Chairman and Managing Director, Reliance Industries Limited said, “The previous month commemorated the 25th anniversary of our Jamnagar refinery. It gives me great pleasure to see Reliance grow exponentially over the years and set new benchmarks that demonstrate the inherent strength and resilience we have across all our businesses. The delivery of record Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) and PAT at a consolidated level for this quarter is a testament to this.”
Oil-to-Chemicals segment performance (Rs crore) |
Particulars | Oct-Dec’24 | Oct-Dec’23 | Variations (%) |
Revenue | 149,595 | 141,096 | 6.0 |
Exports | 67,672 | 74,617 | (-)9.3 |
EBITDA | 14,402 | 14,065 | 2.4 |
EBITDA margin (%) | 9.6 | 10.0 | 40 bps |
Depreciation | 1,583 | 2,071 | (-)23.6 |
Sources: Reliance Industries Ltd, and Polymerupdate Research
O2C business performanceThe O2C segment revenue for the October-December 2024 quarter (3Q FY25) increased by 6 percent year-on-year (YoY) to Rs 149,595 crore (US$ 17.5 billion). This growth was primarily driven by higher production volumes available for sale compared to 3Q FY24, which was impacted by planned maintenance and inspection shutdowns of major units. Revenue growth was further supported by robust domestic demand and strategic product placement. Domestic fuel retailing volumes saw significant growth, with motor spirit (MS) increasing by 43.7 percent and high-speed diesel (HSD) by 22.8 percent.
The segment EBITDA for 3Q FY25 rose by 2.4 percent YoY to Rs 14,402 crore (US$ 1.7 billion), driven by strong volume-led growth and higher polymer deltas. RIL’s flexibility in feedstock, the benefits of ethane cracking over naphtha, and its focus on yield optimization helped offset the impact of unfavorable fuel cracks.
During the October-December 2024 quarter, arbitrage crude sourcing was enhanced to minimize feed costs and maximize crude throughput. Throughputs of major secondary units, such as the Fluid Catalytic Cracking (FCC) unit and the Platformer, were maximized due to favourable margins. Aromatics production was optimized, considering subdued margins, while production of high-value transportation fuels was increased. Domestic fuel sales were maximized to meet sustained demand. Complex fuel costs were reduced by increased Furnace Oil (FO) firing during periods of low gasifier availability. Transportation fuel and downstream chemical production were higher YoY, as 3Q FY24 production had been impacted by planned shutdowns.
Ambani added, “The O2C business showcased its innate resilience, registering growth even in this prolonged period of volatility in the global energy markets. Refining margins recovered sequentially, with petrochemical deltas exhibiting a mixed trend. Upstream segment continues to play a pivotal role in providing the crucial transition fuel bolstering India’s energy security. As we stand at another iconic milestone today, we are geared up for the transformational growth that Reliance is set to experience in the near future.”
Polymer sector growthDomestic polymer demand increased by 11 percent year-on-year (YoY) in 3Q FY25. Polypropylene (PP) demand rose by 16 percent, driven by growth in the consumer durables, packaging, construction, and automotive sectors. Polyethylene (PE) demand grew by 5 percent, supported by the retail and food packaging sectors. Polyvinyl chloride (PVC) demand surged by 16 percent, led by the agriculture and infrastructure sectors.
Domestic demand for polyester increased by 12 percent YoY in 3Q FY25. Polyethylene terephthalate (PET) demand rose by 13 percent, driven by higher demand from the beverages sector. Demand for polyester filament yarn (PFY) and polyester staple fiber (PSF) increased by 13 percent and 9 percent, respectively, due to improvements in downstream operations.
Challenging exportsRIL’s exports of O2C products declined by 9.3 percent to Rs 67,672 crore during the October-December 2024 quarter, down from Rs 74,617 crore reported in the corresponding quarter of the previous year. The export figure also represents a decrease from Rs 71,631 crore reported in the sequential previous quarter. For the nine-month period ending December 31, RIL recorded total export revenue of Rs 209,766 crore, compared to Rs 227,457 crore reported in the same period of the previous year.
In 3Q FY25, global oil demand increased by 1.5 million barrels per day (bpd) year-on-year (YoY) to 104 million bpd, driven primarily by growth in Asia excluding China. Elevated gas prices in the European Union and Asia further contributed to the rise in oil demand. Jet fuel/kerosene demand grew by 0.5 million bpd YoY, gasoline demand rose by 0.4 million bpd YoY, and diesel demand increased by 0.1 million bpd YoY. Dated Brent averaged US$74.7 per barrel in 3Q FY25, down US$9.4 per barrel (11.1 percent) YoY. Crude oil benchmarks declined YoY due to high non-OPEC+ production maintaining ample supply, a strong US Dollar, and a weak Chinese economy.
Global refinery crude throughput increased by 0.75 million bpd YoY to 81.75 million bpd in 3Q FY25. However, the global utilization rate was 29 basis points lower YoY at 78.7 percent, owing to a net capacity addition of 1.3 million bpd. Domestic demand for high-speed diesel (HSD), motor spirit (MS), and aviation turbine fuel (ATF) rose by 4.8 percent, 9.6 percent, and 8.9 percent, respectively, compared to the same quarter last year.
DILIP KUMAR JHAEditor
dilip.jha@polymerupdate.com