Reliance Profit Beats Expectations as Jio Adds Subscribers 2020

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Reliance Profit Beats Expectations as Jio Adds Subscribers 2020

Reliance Jio, the mobile network of Reliance Industries Ltd., sit on display in Mumbai, India, on Monday, Feb. 3, 2020. Indian Prime Minister Narendra Modi’s government plans to allow foreign investors greater access to short-term and long-term government securities in a bid to tap money being poured into passive funds operated by firms such as BlackRock Inc.

(Bloomberg) -- Reliance Industries Ltd. beat expectations to post a record rise in profit as one-off gains from a pact with BP Plc and rising income from wireless phone services offset declines in the conglomerate’s oil-related businesses.

CONSTELLATION BRANDS, INC.

Net income rose to 132.3 billion rupees ($1.8 billion) in the three months ended in June from 101 billion rupees a year earlier, India’s largest company by market value said in a filing Thursday. That compares with the average 77.2 billion rupees profit estimated by analysts.

The net income includes an exceptional gain of 49.66 billion rupees from its transaction to sell 49% of its fuel retail business to BP Plc.

Key Insights BP Plc has paid $1 billion to Reliance Industries Ltd. for a stake in the latter’s fuel retail business, marking its entry into one of the world’s fastest-growing energy markets.

The payment completes a deal announced last year, where BP would own 49% of the joint venture and Reliance the rest.Reliance has been hurt by a slide in oil prices as the coronavirus pandemic stifles economic activity and damps demand worldwide.Still, shares of Reliance have more than doubled since late March, as Chairman Mukesh Ambani won investments totaling about $20 billion into his technology venture, Jio Platforms Ltd., from giants including Google and Facebook Inc.

The investors took stakes in Jio Platforms, a holding company that is seeking to tap demand for e-commerce and other technology services in health care and education to reduce the group’s dependence on oil-related earnings.Investors are awaiting a planned sale of a stake in Reliance’s oil refining and petrochemicals business to Saudi Arabian Oil Co. Ambani told shareholders on July 15 that the deal hadn’t progressed as per original timeline.

The delay has raised concern the decline in oil prices has made it less attractive.Reliance’s refining system can process cheap and dirty oil grades into high-value fuels, helping shield it from price drops that have hit state-run peers in India. Market Reaction Ambani’s success at luring investors has fueled a rally in Reliance shares, which are up more than 140% from a trough in late March.

The stock has also benefited from the company’s improving balance sheet. In June, Reliance said it had achieved its target of zero net debt. The company had previously said it would reach that level by March 2021.

Get More The company’s gross refining margin fell to $6.3 a barrel compared with $8.1 a year ago.Total costs fell 42% from a year earlier to 874.1 billion rupees.

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