Preview:​ RIL ​to see strong Q2 growth on weak base, energy biz revival

MUMBAI: Reliance Industries is likely to report a trailblazing earnings performance for the quarter ended September on Friday aided by a low base in the year-ago quarter and revival in the company’s oil-to-chemical operations.

The country’s largest conglomerate is expected to report a 37 per cent year-on-year growth in consolidated net profit to Rs 13,117 crore, according to an ETMarkets.com poll. Analysts expect the company to report a 36 per cent increase in consolidated revenues to Rs 1.51 lakh crore for the reporting quarter.

On a sequential basis, consolidated net profit is expected to rise 6.9 per cent and revenues are likely to grow 8 per cent.

The driver for earnings in the September quarter will be the refining business, retail business and telecom operations.

The surge in global crude oil prices in the quarter and improvement in global benchmark gross refining margins should boost earnings performance of the refining business in the September quarter. Singapore GRM improved sequentially aided by upswing in demand as global economy continued to open up and oil prices soared.

Further, the retail business will see a strong sequential performance in the quarter as the reopening of the economy would increase footfalls and sales. In the previous quarter, the retail business was hampered by the second wave and the state-wide lockdowns.

However, given the strong recovery shown by Avenue Supermarts, analysts are hopeful of a strong year-on-year and quarter-on-quarter performance from Reliance Retail.

The telecom business is likely to be the highlight of the quarter alongwith refining as the segment is likely to report 5 per cent sequential growth in operating profit and improvement in average revenue per user.

Analysts said that Jio should report higher addition of customers in the quarter and increased ARPU accretion. Brokerage firm JM Financial expects Reliance Jio to report ARPU of Rs 140 for the quarter ended September.

Besides the earnings, investors will keenly watch for the company’s comments on the demand environment in the energy business, ramp-up in JioMart and future tariff hikes in the telecom operations.