DNA Money Edit: RIL walks the talk with consumers

Spurred by the growth in core petrochemicals business and a jump in revenues in its telecom business, Reliance Industries Ltd (RIL) is aiming higher. The country's largest private sector company by profit, which reported a record quarterly profit on Wednesday, is likely to continue its performance in the current fiscal with its core business segment, refining and petrochemical, meeting Street expectations, and retail and telecom verticals reporting growth.

The performance clearly underlines RIL's success in consumer-facing businesses, an unfamiliar territory for the petrochemical giant for several years since its inception, despite macro headwinds. As Mukesh D Ambani, chairman and managing director, rightly pointed out, the retail division's accelerated store expansion, strong value proposition and focus on customer experience across all consumption baskets has resulted in the robust growth.

While its energy operations contribute the bulk of group revenues and profits at present, its telecom unit, RJio, marked a fourth straight quarter of profit in June-September. Revenues of RIL's retail business have more than doubled for the fourth consecutive quarter; profit before depreciation, interest and tax (PBDIT) has more than tripled for the third consecutive quarter. The increase in turnover, according to Reliance Retail, was due to continued growth momentum and strong profitability. The acquisition of controlling stake in the Hathway and DEN Networks will help RIL drop its anchor in two other consumer-facing businesses.