Reliance Industries Limited · NSE:RELIANCE
Reliance Industries — Q3 FY2022 Earnings Presentation
61 slides from Reliance Industries's earnings presentation, Jan 21, 2022
Slide 1: Cover letter to stock exchanges
January 21, 2022 BSE Limited National Stock Exchange of India Limited Phiroze Jeejeebhoy Towers Exchange Plaza, Plot No. C/1, G Block Dalal Street Bandra-Kurla Complex, Mumbai 400 001 Bandra (East) Mumbai 400 051 Scrip Code: 500325 Trading Symbol: RELIANCE Dear Sirs, Sub: Presentation made to analys
Slide 2: 3Q FY22 Financial Results Presentation
3Q FY22 Financial Results Presentation 21 January 2022 1
Slide 3: Forward Looking Statement
Forward Looking Statement This presentation contains forward-looking statements which may be identified by their use of words like “plans,” “expects,” “will,” “anticipates,” “believes,” “intends,” “projects,” “estimates” or other words of similar meaning. All statements that address expectations or
Slide 4: Consolidated Financial Results
Consolidated Financial Results 3
Slide 5: 3Q FY22 – Key Messages (1/3)
3Q FY22 – Key Messages (1/3) 1. Record quarterly EBITDA led by O2C, Oil & Gas, Retail and Digital Services Performance ✓ Consolidated EBITDA at ₹ 33,886 crore, up 29.9% YoY 2. Net profit (incl. exceptional income) at ₹ 20,539 crore up 37.9% YoY 1. Sixth sequential quarter of growth for O2C, with con
Slide 6: 3Q FY22 – Key Messages (2/3)
3Q FY22 – Key Messages (2/3) 1. Record Revenue and EBITDA; Revenue crossed ₹ 50,000 crore, EBITDA at ₹ 3,835 crore Retail 2. Store operations normalized with near 100% operating hours 3. Total 14,412 stores - added 837 stores 1. Revenue crossed ₹ 25,000 crore and EBITDA crossed ₹ 10,000 crore mark D
Slide 7: 3Q FY22 – Key Messages (3/3)
3Q FY22 – Key Messages (3/3) 1. Proactive liability management with continuing optimization of finance costs Corporate ✓ Jumbo Bond issuance (Jan’22) of US$ 4 billion to refinance existing borrowings, extend debt maturity profile ✓ Prepayment of high-coupon spectrum liability of ₹ 30,791 crore over
Slide 8: Consolidated Financial Results: 3Q FY22
Consolidated Financial Results : 3Q FY22 Change Change 1. YoY and QoQ strong recovery in Revenues and Profits (₹ crore) 3Q FY22 2Q FY22 QoQ YoY across businesses Revenue 209,823 191,532 9.5% 52.2% 2. YoY and QoQ revenue growth EBITDA 33,886 30,283 11.9% 29.9% Finance Cost 3,812 3,819 -0.2% -11.9% ✓
Slide 9: Contributing Factors to Change in EBITDA (YoY)
Contributing Factors to Change in EBITDA (YoY) 3Q FY22 vs 3Q FY21 - ₹ crore (YoY) 1. 75% of incremental EBITDA contribution came from O2C and Oil & Gas business 2,029 32 33,886 1,288 2. O2C – strong growth with revival in global economic 733 activities leading to higher fuels and downstream 3,774 ch
Slide 10: Contributing Factors to Change in EBITDA (QoQ)
Contributing Factors to Change in EBITDA (QoQ) 3Q FY22 vs 2Q FY22 - ₹ crore (QoQ) 1. O2C – benefited from higher volumes and further 962 250 33,886 recovery in fuel cracks, mainly middle distillates 669 2. Retail – improved operating environment and 912 810 strong growth across consumption baskets 3
Slide 11: Continuing Recovery in EBITDA
Continuing Recovery in EBITDA EBITDA (₹ crore) 33,886 1. Sixth consecutive quarter of sequential growth 27,550 26,088 26,094 2. Economy reopening, festive season buoyancy aided 21,585 growth acceleration across businesses 3. Diversified portfolio well positioned to participate in economic growth mom
Slide 12: Robust Balance Sheet with High Liquidity
Robust Balance Sheet with High Liquidity (in ₹ Crore) Dec-21 Sep-21 Gross Debt 244,708 255,891 Cash & cash equivalent 241,846 259,476 Net Debt 2,862 (3,585) 1. High-cost spectrum liabilities refinanced with market borrowings 2. Proactive liability management through refinancing – extended maturities
Slide 13: O2C – Sustained Recovery Led by Fuel Margins
O2C – Sustained Recovery Led by Fuel Margins Demand and Margin Environment 1. Global oil demand up 1.1 mb/d QoQ with increased mobility and higher vaccination coverage ✓ Sharp recovery in fuel cracks led by multi-quarter high middle distillates 2. Higher feedstock and energy costs weighed on downstr
Slide 14: Digital Services – Robust EBITDA with ARPU Improvement
Digital Services – Robust EBITDA with ARPU Improvement Operating Performance 1. Total customer base at 421.0 million as of Dec’21 - QoQ gross addition of 34.6 Mn and net addition of (-)8.5 Mn ✓ SIM consolidation and repurposing of customer retention efforts led to a net reduction in subscriber base
Slide 15: Retail – Revival in Growth Momentum Driving Record Quarter
Retail – Revival in Growth Momentum Driving Record Quarter Operating Environment 1. Store operations normalized with footfalls at 95% of pre-Covid levels, up ~30% over last year 2. Strong customer demand across consumption baskets as markets opened-up, supported by festive season 3. Agile business o
Slide 16: Digital Services
Q Reliance Industries Limited Digital Services
Slide 17: Positive Changes In Indian Telecom Landscape
Positive Changes In Indian Telecom Landscape ➢ Government has undertaken decisive steps to strengthen India’s telecom sector ➢ Subsequently, operators have raised tariffs by ~20-25% across plans that should boost revenue growth for the sector ➢ Covid impact on recharge cycle and tariff hikes may hav
Slide 18: Revision in Prepaid Tariffs
Revision in Prepaid Tariffs ➢ In line with tariff revisions of other operators, Jio also raised ARPU increase tariffs by ~20% across prepaid plans effective 1st Dec 2021 to take effect ➢ Jio’s new plans continue to provide the best value for consumers in the industry across price points Pre and Post
Slide 19: Digital Recharge For Customers
Digital Recharge For Customers ➢ Jio AutoPay launched for all Jio subscribers ▪ Enabled for all key UPI handles ▪ Simple & secure flow ➢ Recharge journey launched within WhatsApp for ease of usage for consumers ▪ Recharges within WhatsApp using WhatsApp Pay enabled exclusively for Jio Recharge withi
Slide 20: Customer Engagement Remains Robust
Customer Engagement Remains Robust Consistently Strong Gross Subs Addition ➢ Jio’s superior service continues to attract new customers (m) with gross adds remaining strong at 34.6 million 35.6 34.6 31.2 25.1 26.7 ▪ Quality of subscriber base continues to improve ▪ SIM consolidation at the lower-end
Slide 21: Jio Maintains Network Leadership
Jio Maintains Network Leadership ➢ Customer experience continues to improve with average download speed of 22.0 Mbps in Dec’21 (TRAI MySpeed data) despite ~48% YoY increase in data consumption ➢ Execution ramped up with deployment of newly acquired spectrum in record time amidst Covid related challe
Slide 22: Data Driven Planning For Jio's 5G Network
Data Driven Planning For Jio’s 5G Network ➢ Network planning based on targeted customer consumption and revenue potential ➢ Use of Heat maps, 3D maps and Ray tracing technology for precise coverage planning to target high consumption and high perception locations ➢ Continuous planning, continuous de
Slide 23: Jio Is Trialing Advanced 5G Use Cases
Jio Is Trialing Advanced 5G Use Cases 1 2 3 4 1. 5G Robot delivering food trays to patients controlled by fleet management system in the cloud 2. Connected ambulance streaming vital information via 5G 3. 5G site inspection using a 5G connected drone 4. 5G Robotics in warehouse automation Healthcare
Slide 24: Control the OS ➔ Deliver Enhanced Experience
JioOS Features across Home Devices Entertainment Connectivity User Profiles Easy Mesh • Multiple User profile • Parental Control • Profile Specific Recommendations 08 01 • Single Wi-Fi Network in all Access Points (AP) • Seamless roaming between Aps • Wi-Fi Experience Measurement tools Voice Assista
Slide 25: Jio Set-Top-Box App Ecosystem
Jio Set-Top-Box App Ecosystem Jio Apps 3rd Party Apps • Bouquet of Jio Apps offering • Bringing best of the World apps assorted services to Jio users and continuously growing App Bouquet • Curated content for users as per their preference • Content from different regions, languages, genres can be •
Slide 26: Quarterly Highlights
Quarterly Highlights 11. Strong financial performance across connectivity and platform businesses ➢ JPL Revenue at Rs 20,597 crore; JPL quarterly EBITDA crossed Rs 10K crore at Rs 10,008 crore with 48.6% EBITDA margin 21. Gross subscriber additions remained strong ➢ Total gross adds of 34.6 million
Slide 27: RJIL – Key Operating Metrics
RJIL – Key Operating Metrics 3Q’ 21-22 2Q’ 21-22 3Q’ 20-21 ➢ Robust gross additions of 34.6 million Total Customer base 421.0 429.5 410.8 (million) ▪ Net subscriber base reduction due to Net Customer addition (8.4) (11.1) 5.2 SIM consolidation and repurposing of (million) ARPU customer retention eff
Slide 28: RJIL – Key Financials
RJIL – Key Financials Operating Revenue (in Rs crore) EBITDA (in Rs crore) 19,347 18,735 9,669 18,492 17,994 9,003 8,631 17,358 8,166 8,313 Dec-20 Mar-21 Jun-21 Sep-21 Dec-21 Dec-20 Mar-21 Jun-21 Sep-21 Dec-21 ➢ RJIL revenue up 3.3% QoQ; like-for-like growth at ~13% YoY adjusted for IUC ➢ EBITDA mar
Slide 29: Jio Platforms Limited - Key Financials
Jio Platforms Limited - Key Financials Particular JPL Consolidated 3Q’ 21-22 2Q’ 21-22 3Q’ 20-21 Gross Revenue* 24,176 23,222 22,858 ➢ JPL quarterly EBITDA crossed Rs Operating Revenue 20,597 19,777 19,475 10,000 crore for the first time EBITDA 10,008 9,294 8,483 ➢ Quarterly revenue up ~14% YoY EBIT
Slide 30: Retail
Q Reliance Retail
Slide 31: Operating Context Improves
Operating Context Improves % Store Operational Days & Footfalls 1. Store operations normalize in quarter with reinforced safety standards 96% 94% 89% 97% 2. Footfalls back to pre-COVID levels (95%); up ~30% over last year 85% 95% 88% 61% 78% 3. Strong customer demand in Q3 as markets open up and fes
Slide 32: 3Q FY22: Key Messages
3Q FY22: Key Messages 1. Revenue at record high; up 53% YoY; led by a strong festive season and bounce back of store sales 2. Record EBITDA; at Rs. 3,822 Cr, up 24% YoY, driven by buoyant revenue 3. Rapid infra expansion continues; 837 stores and 73 supply chain locations added 4. Digital commerce o
Slide 33: Revenue at a Record High
Revenue at a Record High 1. Total Gross Revenue at Rs. 57,714 cr, up 53% YoY and 27% QoQ Gross Revenue ✓ Retail excluding Connectivity & Petro Retail, up 90% YoY and 49% Rs Crores QoQ 57,714 ✓ Highest ever store sales, continued momentum on Digital + New 45,327 47,064 45,426 Commerce 38,211 41,100 3
Slide 34: Record EBITDA
Record EBITDA 1. EBITDA at Rs. 3,822 Cr at a record high EBITDA ✓ Excluding Investment Income, growth of 52% YoY; 45% QoQ Rs Crores ✓ Led by strong broad based revenue recovery 3,617 3,822 2,913 ✓ Operating leverage and favorable mix drive margin expansion of 90 2,747 2,557 3,087 bps QoQ 2,006 1,941
Slide 35: Rapid Infra Expansion Continues
Rapid Infra Expansion Continues 1 Store Added in Quarter Stores by Consumption Baskets 813 837 Additions As at 3Q 31st Dec 21 North 209 3,212 South 252 4,276 327 East 186 3,132 West 186 3,707 International 4 85 3Q 2Q 3Q Total Store Count* 837 14,412 FY21 FY22 * Total Store count excludes Pharma SIS
Slide 36: Strengthening Capabilities Through Acquisitions
Strengthening Capabilities Through Acquisitions Marquee Indian Premium Women Regional Grocery Designer Brand Intimate Wear Brand Retail Chain Couture Fashion Leading Sarees and Leading Last Mile Brand Ethnic Wear Retailer Delivery and Quick Commerce Player Building a strong foundation for sustainabl
Slide 37: Financial Summary
Financial Summary In Rs Crore % Growth % Growth 2Q FY22 Parameter 3Q FY22 3Q FY21 Q-o-Q Y-o-Y 45,426 27% Gross Revenue 57,714 37,845 53% 39,926 27% Net Revenue 50,654 33,018 53% 2,436 45% EBITDA from Operations 3,522 2,312 52% 6.1% 90 bps EBITDA Margin from Operations (%) 7.0% 7.0% - 477 -37% Invest
Slide 38: Performance Highlights – Consumer Electronics
Performance Highlights – Consumer Electronics 1. Consistent double-digit growth from stores sales maintained; boost from devices 2. Best-ever Diwali sales with conversion and ABV at record high; outperforming market 3. Broad based double-digit growth across categories – productivity segment does par
Slide 39: Performance Highlights – Fashion & Lifestyle (1/2)
Performance Highlights – Fashion & Lifestyle (1/2) 1. Apparel & Footwear up 2X YoY; records highest ever quarter driven by festive and winterwear ✓ Store performance bounces back - footfalls at pre-covid levels; conversions and ABV remain high ✓ Trends Small town launched its 500th store; records hi
Slide 40: Performance Highlights – Fashion & Lifestyle (2/2)
Performance Highlights – Fashion & Lifestyle (2/2) Jewels 1. Strong double-digit growth momentum sustained; festive collection ‘Kaasyam’ well received 2. Diamond contribution up; strong customer tractions on affordable diamond collection Partner Brands 1. Revenue grows nearly 2X – offline stores bou
Slide 41: Performance Highlights – Grocery
Performance Highlights – Grocery 1. All-time high revenue on record store sales (led by higher bill values and footfall recovery) 2. Best-ever festive period sales driven through impactful activations, growth faster than market 3. Launched Freshpik, a gourmet store at JWD; expansion planned 4. JioMa
Slide 42: Performance Highlights – Other Businesses
Performance Highlights – Other Businesses Pharma 1. Highest ever quarter; hyperlocal contribution now at 18% 2. Netmeds platform continues to scale up, ~2X growth in MAU; daily orders up 1.6x 3. Rapid expansion of New Commerce operations presence extended to cover 1,200+ cities Urban Ladder 1. Over
Slide 43: Looking Ahead
Looking Ahead 1. Navigate the volatility arising out of the recent COVID strain 2. Accelerate growth momentum and expansion as operating context normalizes ✓ Increase the pace of new store rollout ✓ Scale up digital commerce business across all platforms even further; augment offering and sharpen se
Slide 44: Oil & Gas
Q Reliance Industries Limited Oil & Gas
Slide 45: Oil & Gas Segment Performance
Oil & Gas Segment Performance Change 1. EBITDA up 90% QoQ with sharp (in ₹ Crore) 3Q FY22 2Q FY22 3Q FY21 improvement in margins QoQ Revenue 2,559 1,644 55.7% 431 ✓ Sustained production from R-Cluster EBITDA 2,033 1,071 89.8% 4 and Sat-Cluster EBITDA Margin(%) 79.4% 65.1% 0.9% ✓ Sharp improvement in
Slide 46: Other Updates
Other Updates 1. KG D6 - MJ Field ✓ 1st Phase of Drilling of wells completed. 2nd Phase of Completions campaign to commence in 1Q FY23 ✓ FPSO Construction activities on schedule MJ: FPSO Moonpool block ✓ Final Offshore field installation campaign is in progress ✓ Production start expected from 3Q FY
Slide 47: Oil to Chemicals
Q Reliance Industries Limited Oil to Chemicals
Slide 48: Global Environment - Demand and Utilization Levels
Global Environment - Demand and Utilization Levels Volume Change 1. Continuing recovery in global oil demand Global Oil 99.0 mb/d 4.8 mbd YoY ✓ Higher vaccination coverage and reopening Demand 1.1 mbd QoQ 2. India oil demand muted primarily due to weak India diesel consumption Oil 53.3 MMT 3.8%
Slide 49: Global Environment - Price and Margin Trends
Global Environment - Price and Margin Trends Avg. Price % QoQ 1. Strong energy prices led by demand, supply constraints Brent $79.7/bbl 8.5% ✓ Oil price supported by demand revival, OPEC discipline Feedstock Price Asian LNG $34.9/mmbtu 87.1% ✓ LNG prices at all-time high levels Naphtha $735/MT
Slide 50: Domestic Environment – Oil Demand
Domestic Environment – Oil Demand Domestic Oil Demand 1. Oil product demand at 53.3 MMT, down 3.8% YoY indexed to 3QFY20 (pre-covid levels) 120% ✓ High retail price on YoY and incessant 109% rainfall/floods in Southern and Eastern states 100% 95% impacted diesel demand 80% 72% ✓ ATF demand up 32% Yo
Slide 51: Domestic Environment – Polymers Demand
Domestic Environment – Polymers Demand Domestic Demand 1. Polymer demand down by 4% YoY and 3% QoQ indexed to 4QFY20 (pre-covid levels) ✓ Firm feedstock and product prices – PVC at all 130% time high 120% 120% 110% 109% 2. Demand remained subdued despite festive 100% season 94% 90% ✓ Stable demand g
Slide 52: Domestic Environment – Polyester Demand
Domestic Environment – Polyester Demand Domestic Demand 1. Polyester demand down by 5% YoY, 4% QoQ indexed to 4QFY20 (pre-covid levels) 2. Volatility in raw material prices affected polyester 130% 120% demand after the festive season 117% 113% 110% ✓ 3Q FY21 demand was unusually high as market 109%
Slide 53: Business Environment – Polymers and Polyester Deltas
Business Environment – Polymers and Polyester Deltas Polymer Deltas Polymers 800 698 541 628 565532 586 1. QoQ Polymer margins stable, despite higher feedstock prices 600 497498 524 426 445 385 400 ✓ YoY impact of higher feedstock (naphtha, ethane, EDC) prices 200 was much sharper 0 4QFY20 3QFY21 2Q
Slide 54: Business Environment – Transportation Fuels
Business Environment – Transportation Fuels 15 Asian Gasoil (10 ppm) Cracks 650 Gasoil 12.6 620.0 1. Global gasoil demand improved for 3rd consecutive quarter, 10 600 up 0.9 mb/d QoQ to 28.9 mb/d Mn bbls 8.1 $/bbl 561.0 2. Gasoil cracks at 8-quarter high, supported by 5 4.3 550 539.0 ✓ Gas to oil sw
Slide 55: Business Environment – Transportation Fuels
Business Environment – Transportation Fuels Asian Gasoline 92R Cracks Gasoline 1. Global gasoline demand remained flat QoQ at 26.4 mb/d 15 500 12.9 463 2. Gasoline cracks further strengthened, now at 17-quarter high 9.7 450 10 ✓ Pick up in regional demand with easing of restrictions Mn bbls $/bbl →
Slide 56: O2C Performance Highlights – 3Q FY22
O2C Performance Highlights – 3Q FY22 ₹ 131,427 crore ₹ 13,530 crore 10.3% Revenue EBITDA EBITDA margin 9.1 % QoQ 6.4 % QoQ 30 bps QoQ 56.8 % YoY 38.7 % YoY 130 bps YoY 1. Sustained QoQ EBITDA growth led by ✓ Sharp improvement in transportation fuels margins – aided by middle distillates
Slide 57: O2C Operating Performance
O2C Operating Performance Feedstock 3Q FY22 2Q FY22 1. Refinery throughput and secondary unit processing maximized (Vol in MMT) with improvement in transportation fuel margins Throughput 19.7 18.7 2. Availability of domestic gas and internal fuels helped eliminate dependence on high-cost LNG Product
Slide 58: O2C Business Dynamics
O2C Business Dynamics 1. Oil demand is expected to average 99.7 mb/d in 2022, up 3.3 mb/d YoY Macro 2. Oil supply growth to be met by incremental production from OPEC+ 3. China’s thrust on self-sufficiency of Petrochemicals likely to alter the regional trade flow 1. Lowering of fuel export quotas in
Slide 59: Summary
Summary 58
Slide 60: Summary
Summary 1. Multiple growth engines driving exponential value creation ✓ World-class integrated O2C platform ✓ Best-in-class technology platform to catalyze digital opportunity in India ✓ Omni-channel retail strategy to maximize reach across Indian consumers ✓ Building one of the most advanced and in
Slide 61: Thank You
Thank You 60
Reliance Industries — Q3 FY2022 Earnings Presentation on 6ix