Reliance Retail Q1 net zooms 114%, 792 new stores launched in June quarter
The Reliance Retail growth story was powered by higher contribution from fashion & lifestyle and consumer electronics and growing operating leverage over the previous year across consumption baskets.
Reliance Retail Ventures, the retail arm of Reliance Industries Ltd (RIL), on July 22 reported a 114.2 percent year-on-year (YoY) jump in net profit at Rs 2,061 crore for the first quarter ended June 30, 2022.
The company's gross revenue stood at Rs 58,554 crore for the first quarter, registering a growth of 51.9 percent YoY. The cash profit for the quarter was Rs 2,873 crore, higher by 105.2 percent YoY.
The business posted an operating EBITDA (Earnings before interest, taxes, depreciation, and amortisation) of Rs 3,897 crore, up 180.4 percent YoY with a 350-bps improvement in the margin at 7.6 percent, compared to 4.1 percent in the corresponding quarter of the previous year.
This was led by higher contribution from fashion & lifestyle and consumer electronics and growing operating leverage over the previous year across consumption baskets.
Also read: Reliance Industries likely to clock 50% jump in quarterly profit powered by oil-to-chemicals unit
The business continues to seize the large market opportunity in the country by expanding its presence across geographies. With 792 store openings in the quarter, the spread of 15,866 stores — with an area of 45.5 million square feet — covers all corners of the country, the company said.
Reliance Retail has added over 17,000 jobs during the first quarter of FY23. The total employee count stands at 3,79,000.
Commenting on the results, Mukesh D. Ambani, Chairman, and Managing Director of Reliance Industries Ltd said, "Geopolitical conflict has caused significant dislocation in energy markets and disrupted traditional trade flows. This along with resurgent demand has resulted in tighter fuel markets and improved product margins."
"I am also happy with the progress of our consumer platforms. In the Retail business, we continue to focus on enhancing our consumer touch-points and building a stronger value proposition for our customers," he said.
"Our strong supply chain infrastructure and sourcing efficiency is helping us maintain competitive pricing for daily essentials, thereby insulating consumers from inflationary pressures. Customer engagement on our Digital Services platform remains high," Ambani added.
Jiomart
With a presence in 268 cities, Jiomart is the largest hyperlocal platform in the country and is extending its geographical reach and product offerings to drive orders.
Daily subscription orders through Milkbasket have doubled over last year as the service is ready for rollout to newer geographies. JioMart Digital continues to scale up its merchant partner network and operations with revenues up over 3x over the trailing quarter.
Reliance Jewels
The company delivered a strong quarter with revenues up nearly 3x over last year driven by strong festive sales, wedding season, and network expansion. Leveraging the design capabilities that it has built over time, the business launched 5 new collections during the quarter.
With Amante, Clovia, and Zivame as part of its portfolio, Reliance now caters to all the price segments across the lingerie business. The lingerie business grew nearly 5x Y-o-Y as the businesses scaled up their online offering and offline distribution.
In the luxury or premium brands, the business grew 5x over last year driven by fully operational mall stores and in-store events. The business through AJIO Luxe scaled up 6x over last year with the presence of nearly 400 brands and 38,000 options on the platform.
Franchise Agreement
The company signed a master franchise agreement with GAP Inc, Tod’s, and Pret A Manger. In addition, Reliance Retail has acquired Catwalk, a leading women’s footwear brand, and has acquired the India franchise rights for Sunglass Hut, a multi-brand premium eyewear retailer. It also formed a joint venture with Plastic Legno SPA's by acquiring a stake in the toy manufacturing business in India.
In the merchant partner business, the platform added 660 new brands as it continued to strengthen its product offering. It introduced 14 new own brands during the quarter increasing the share of its own brands to 30 percent, an increase of 300 bps over last year.
The digital commerce platforms continue to grow from strength to strength with daily orders up 64 percent YoY. Digital and new commerce grew 2x over last year and contributed about 19 percent of gross revenue.
Disclaimer: Network18, the parent company of CNBCTV18.com, is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.
(Edited by : Shoma Bhattacharjee)
First Published: Jul 22, 2022 8:15 PM IST
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