Reliance Industries limited (RIl) on Friday posted standalone net profit at Rs6,318 crore, or Rs19.5 per share, in April-June was 11.8 per cent higher than Rs5,649 crore, or Rs17.5 a share, in the same period a year ago.With strong growth in refining and petrochemical margins, RIl witnessed the highest quarterly profit in seven-and-a-half years since earning in October-December 2007.
“Financial performance reflects the benefits of integrated hydrocarbon chain activities in a benign oil price environment,” said Mukesh Dhirubhai Ambani, Chairman and Managing Director, RIl, adding the sharp increase in demand for transportation fuels helped company realise strong refining margins.
However, revenue of the company fell 26 per cent to Rs77,130 crore, hurt by a sharp fall in prices of crude oil and petroleum products, the company said in a statement.“Consolidated net profit rose 4.4 per cent to Rs6,222 crore in April-June quarter of the current fiscal as opposed to Rs5,957 crore a year ago,” the statement added.
RIl, operator of the world’s biggest oil-refinery complex that can process low-grade crude and switch between fuels depending on market prices, earned $10.4 on turning every barrel of crude into petroleum product.This was the highest gross refining margin it has earned in six year as compared to $10.1 per barrel margin in preceding January-March quarter and $8.7 of Q1 of 2014-15 fiscal.
The company, which is investing $12 billion to boost petrochemical capacity and refinery processes as well as build facilities to import ethane from US, said a 23 per cent dip in its turnover to Rs83,064 crore was mostly because of 43.5 per cent dip in oil prices.
Joint Chief Financial Officer V Srikanth, however, said $5 billion more will be invested to complete the refining and petrochemical cracker and downstream projects.“RIl has in recent years invested in sectors like telecom, retail and financial services and it seeks to diversify revenue sources and reduce dependence on the country’s heavily-regulated oil and gas sector. “The telecom venture, Reliance Jio Infocomm will be able to start full commercial operations in the next financial year,” it said.
Meanwhile, RIl shares fell 1.9 per cent to close at Rs1,025.05 on the BSE just before the company’s announcement of its results.RIl’s pre-tax profit from refinery business jumped 37.7 per cent to Rs5,252 crore, earnings from petrochemical business soared 25.5 per cent to Rs2,338 crore.
EBIT from oil and gas production business however dropped 97 per cent to Rs32 crore. Other income fell to Rs1,832 crore in April-June from Rs1,974 crore. Depreciation of Indian rupee led to its costs jumping to Rs902 crore, as against Rs505 crore in first quarter of previous fiscal.