India’s Reliance sees profits jump 28 pct on higher oil margins

MUMBAI: Indian oil-totelecom conglomerate Reliance Industries’ first-quarter consolidated profit jumped 28 per cent, pumped up by higher margins from its core oil refining business, the group said, beating analyst estimates.

Consolidated net profit for the three months through June rose to 91.08 billion rupees (US$1.4 billion), up from 71.13 billion rupees a year earlier, said the Mumbai-based firm which is owned by India’s richest man Mukesh Ambani.

A Bloomberg survey of six analysts had projected the net profit to come in at 76.3 billion rupees.

Revenue for the period was up 26 per cent to 900 billion rupees.

“Our industry leading portfolio of assets in the refining and petrochemicals business contributed to considerable improvement in our earnings for the quarter,” Reliance chief Mukesh Ambani said in a statement.

Gross refining margin, the profit earned from each barrel of crude processed, was at US$11.9 in the June quarter, up from US$11.5 a year earlier.

Refining margins are a key measure of profitability for the business.

The company also said it planned to raise 200 billion rupees, through a rights issue, to make additional investments in its flagship 4G telecom services business, Jio.

As the latest entrant to India’s highly competitive telecom sector, Jio shook the sector with free data and voice services for seven months from September 2016 till March 2017.

The ensuing price war as rivals scrambled to compete has since triggered a consolidation in the sector, even as the incumbents have blamed the new entrant and its freebies for their mounting losses. — AFP