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Reliance Industries Limited Conference Call Transcripts of Q4FY21 | Yadnya Investment Academy

Reliance Industries Limited Conference Call Transcripts of Q4FY21 | Yadnya Investment Academy

Published on 03 May 2021 Views 85 Comments 0

Q4FY21 Highlights:

  • RIL recorded a Net Profit of Rs. 14,995 Cr. in Q4FY21 in its Consolidated business, which is significantly higher sequentially as well as on yearly basis.
  • On the tune of growth in the O2C segment of 21%, the revenue of the company has grown by 25% in Q4FY21.
  • EBIDTA growth was led by the revival of in-store operations as well as digital commerce ramp up. Now, Consumer business accounts for nearly 49% of overall segment EBITDA.
  • The overall cumulative cash inflow of Rs 260,000 has been used to return debt and other liabilities and leaving us with a highly liquid balance sheet,

Reliance O2C- Q4FY21 Highlights:

  • O2C Segment of Reliance has recovered on the back of stable demand, fiscal stimulus, and vaccination drive.
  • This segment reported volume growth of 2.2% QoQ. Overall, Oil Demand is up by 2% YoY.
  • Though Q-o-Q is slightly lower, in terms of demand, otherwise, we see the domestic oil product demand, Y-o-Y shows the growth of 2.5% and flattish to slightly lower on a Q-o-Q basis.
  • Gasoline, diesel, up about 10% and 4% respectively on year on year basis. While for ATF, almost 16% Q-o-Q growth. But, in the broader context of the year, it was down 29%.
  • Polymer and Polyester demand up 12% and 21% respectively though on Q-o-Q it remained the same.
  • The focus is now on specialty components so that we push for more niche and higher-margin grades.
  • From India's standpoint, some of the longer-term demand drivers include Vehicle scrappage policy, new CAPEX investments across downstream sectors of Flexible Containers, Pipes, Geo-synthetics, and Hygiene to boost consumption, etc.

Reliance Jio- Q4FY21 & FY21 Highlights:

  • Operating Revenue stood at Rs. 17,358 Cr. and EBITDA is Rs. 8,313 Cr. in Q4FY21.
  • At the year ended 31st March 2021, Reliance Jio is having a strong customer base of 426 million subscribers with gross addition of 31.2 million new subscribers in Q4FY21.
  • Average Revenue Per User stands at Rs. 138.
  • EBITDA Margins are now close to 47%, up by 600 basis points.
  • Reliance became the first operator outside of China to cross 400 million subscribers in a single country market.
  • The company added 99 million subscribers – gross additions during FY21.
  • Reliance Jio enhanced its spectrum footprint to 1,732 MHz.
  • The company has got a very healthy footprint across 800, 1800, and 2300 bands and a strong footprint of a lot of contiguous spectrum as well, which will support deployment, much more spectral efficiency, and deployment of 5G as the company moves forward.
  • Reliance Jio is having market leadership in 19 out of the 22 circles with a 45% AGR market share and growing.

Reliance Retail- Q4FY21 Highlights:

  • Under the Retail Sector, all the divisions like Fashion and Lifestyles, Grocery, and Consumer Electronics have performed well in this quarter.
  • The company added 826 new stores in Q4FY21.
  • Despite being badly hitten by the Covid-19 Pandemic, the EBITDA performance of this business segment was at an all-time high.
  • Reliance Retail has continued for expansion of the business.
  • The fashion and Lifestyle business has been scaled up, Reliance JioMart was launched, and Reliance Digital was activated.
  • Created over 65,000 job opportunities from the start of the pandemic.
  • EBITDA of this segment stood at Rs, 9,800 Cr. in Q4FY21 whereas Profit After Tax (PAT) was at the all-time high levels of Rs. 5,500 Cr.
  • Quarter-on-Quarter, Retail segment witnessed an increase in normalcy, footfalls in the retails store was not much good in first two quarters due to lockdowns, but it increased to 75% in Q3FY21, and 88% in Q4FY21, with only 95% stores open.
  • Digital and New Commerce accounts for to10% of the sales on the retail side.
  • The boost has come from higher investment income and margins have been maintained despite all the operating challenges.
  • The company is concentrating a lot on the expansion of the stores.
  • With the addition of around 1500 stores in FY21, now total store counts to 12,700 odd stores.
  • Growth was broad-based, pretty much all categories delivered strong growth, led by productivity devices, appliances, televisions, and air conditioning.
  • The Company is expanding its brand portfolio like JioPhone, Reconnect, and BPL Kelvinator.
  • Small town stores are now 2X of what they were at the same time last year, and this gives you a sense of the buoyancy of that part of the business.
  • On AJIO the momentum has continued in the last quarter, 4x over same time last year revenues. We've continued to grow, the entire catalog, the entire range of offerings on AJIO options, and moved up 2X over the same time last year.
  • The number of sellers, the number of brands are all signed up as this business positioned itself as the leading fashion and lifestyle destination, offering a breadth of categories to consumers.
  • The company is also focusing a lot on the supply side. Currently, the business is having a large number of sellers onboards as well as starting to activate and use local events as the route to be able to onboard many more merchant partnerships across the country.
  • Jewel Business is also up by 1.8x in this Q4FY12 as compared to the same quarter last year.
  • Launched Ajio Lux, a curated section that holds about 60 premium and rich brands.
  • JioMart has continued to scale up - more orders, more traffic, clearly more customers, the assortment is three times more than it was when we launched it, and clearly, that continues to grow and so very strong emphasis that we have to continue growing JioMart assortment, offer the widest possible selection to customers.
  • On the Kirana program, Reliance Retail has now extended the coverage to 10 more cities, we now active in 33 cities, and of course with some catchments that we were servicing in the vicinity and this is a function of how fast we're ramping up the supply chain network, but we now in 33 cities.
  • JioMart kiranas program is landing well because it's translating to a higher frequency and higher purchase.
  • The company is looking to continue to step up the pace of new store openings, particularly in space of grocery and fashion, and lifestyle. Further looking to accelerate digital commerce, you've heard me say that before, expand the category play on JioMart to make JioMart the horizontal play.
  • Grow new commerce merchant partnerships across businesses and geographies, the company is making significant progress, run rates are clearly much higher and therefore this is a big part of the agenda for the current year.
  • Building a strong backend, a very strong foundation for the next wave of exponential growth of this business, expanding design centers, developing the vendor ecosystem for the aspirations that we have for the retail business, and very fast tracking supply chain infrastructure, across the breadth of our businesses.

Hydrocarbons- Exploration & Production:

  • A strong quarter in terms of both the production as well as the completion of the Satellite cluster field.
  • The R-Cluster field reached peak production ahead of schedule by almost a couple of months. We are at about 12.8 million standard cubic meters a day.
  • The Company is continuing to focus on now developing the MJ field, which is expected to be commissioned in the second half of next year.
  • The trajectory will continue – our EBITDA margins will continue – to improve as production and revenues increase.
  • Our efforts continue to look at potential opportunities in proximity to the existing oil and gas infrastructure.
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