
Reliance Industries posted its highest-ever quarterly profit in Q1 FY26. Net profit rose 76.5% year-on-year to ₹30,783 crore. Yet, the stock declined by nearly 3% after the results were announced. Here’s why the market reacted cautiously.
A Closer look into the Reliance Industries number
Reliance earned ₹8,924 crore from selling shares of listed companies, mainly Asian Paints. This pushed up its overall profit for the quarter. Without this one-time income, profit would have grown by around 25%.
Company posted EBIDTA of ₹58,024 crore, which is 35.7% growth on a year-on-year basis. Excluding this one-off gain, EBDITA would have increased by only 15%.
Jefferies said that consolidated EBITDA was 3% lower than its estimate. It also said that the Oil to Chemicals and Retail businesses fell short of expectations by 5% and 4%.
Segment Performance: Growth, But With Some Gaps
Jio Platforms posted strong growth. Revenue was ₹41,054 crore, up 18.8% year-on-year. EBITDA rose 23.9% to ₹18,135 crore, with margins improving to 51.8%. The subscriber base reached 498 million. Jio now has over 200 million 5G users and 20 million home broadband connections.
Reliance Retail grew steadily. Revenue rose 11.3% to ₹84,171 crore. EBITDA increased 12.7% to ₹6,381 crore. The company added 388 new stores, taking the total to 19,592. However, growth in electronics was lower due to early rains. Store expansion was also slightly behind expectations.
Oil to Chemicals faced some pressure. Revenue dropped 1.5% year-on-year to ₹1.55 lakh crore. EBITDA rose 10.8% to ₹14,511 crore. Margins improved, but volumes were lower due to shutdowns and weaker crude prices.
Oil & Gas revenue fell 1.2% to ₹6,103 crore. EBITDA declined 4.1% to ₹4,996 crore. KGD6 gas output fell, while CBM production improved. Higher maintenance costs also impacted margins.
JioStar Media performed well. Revenue was ₹11,222 crore and EBITDA stood at ₹1,017 crore. The IPL 2025 season helped boost viewership. JioHotstar crossed 460 million monthly active users. The final match set new viewership records on both TV and digital.
Why Did the Stock Fall?
- The profit included a large one-time gain from the sale of Asian Paints shares.
- EBITDA and segment performance were slightly below analyst estimates.
- Oil to Chemicals revenue declined, and growth was mainly margin-led.
- Retail sales in some categories, such as electronics, were soft.
- Overall revenue growth was 6%, the lowest in the last nine quarters (excluding one-offs).
- The stock had already moved up before results, so some investors booked profits.
Macquarie said Reliance’s share price could see a short-term pause after these results. HDFC Securities’ Devarsh Vakil said the company’s performance was affected by lower margins in Oil to Chemicals and reduced crude processing. Emkay said retail and Jio are likely to accelerate, and the new energy ecosystem is expected to operationalise in four to six quarters fully.
Key Takeaways and Outlook
- Reliance reported record profit, but much of it came from a one-time gain. The core profit and EBITDA were strong, but not as high as the headline numbers suggested. This is why the stock did not react positively.
- The main businesses continued to grow. But Oil to Chemicals and Retail fell slightly short of what the market expected. Jio performed well, but that was already known and priced in.
- Revenue growth was slower than usual. Some parts of the business, like electronics in Retail, faced seasonal impact. Oil to Chemicals saw lower volumes due to planned shutdowns.
- The market is now looking at how much of this growth is repeatable. Investors want to see stronger core numbers in the next few quarters.
- Still, the company remains on track. Jio is expanding its user base and services. Retail is adding new stores and products. The new energy business is expected to start contributing soon. Analysts continue to see good long-term potential.
Source: Company filing, Screener, ETmoney, Reuters
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