Reliance Retail pre-tax profit rises 11.8% at Rs 3,102 crore in Q3

The retail arm of Reliance Industries had posted a pre-tax profit or EBITDA (earnings before interest, tax, depreciation and amortisation) of Rs 2,736 crore in October-December quarter a year ago

Reliance Retail on Friday reported an 11.80per cent rise in its pre-tax profit to Rs 3,102 crore for the third quarter ended December 2020.

The retail arm of Reliance Industries Ltd (RIL) had posted a pre-tax profit or EBITDA (earnings before interest, tax, depreciation and amortisation) of Rs 2,736 crore in October-December quarter a year ago.

However, revenue from the organised retail segment slipped 22.94 per cent to Rs 36,887 crore in the December 2020 quarter, compared to Rs 45,348 crore in the same period last fiscal.

"The business delivered a healthy performance with record profit delivery in an operating environment that continued to remain challenging with sporadic Covid related restrictions and local issues," the company said in a statement.

The overall revenue of the retail segment was further affected by transfer out of the fuel retailing business to the RIL-BP JV and decision to convert Reliance Market stores to fulfilment centres to enable city expansion of New Commerce, it added.
 

Covid-19 related curbs on store operations eased during the quarter, enabling 96 per cent of stores to be opened, although only half of them were fully operational.

According to the company, stores in smaller towns are recovering faster.

"Overall footfalls remained at similar levels to last quarter, but still lower than pre-Covid levels," it said.

During the quarter, grocery business and electronics stores sustained double-digit growth, while the fashion and lifestyle business delivered a strong rebound, surpassing the pre-Covid levels.

"The business accelerated the pace of new store expansion with 327 stores opened during the quarter, taking the total store count to 12,201 stores spread over 31.2 million sq ft," the company said.
 

Moreover, digital commerce momentum continued with "orders up 12X y-o-y alongside growth in portfolio, traffic and customer base across platforms".

Reliance Retail has added over 50,000 new jobs since the beginning of the pandemic, it said.

While consumer electronics stores (excluding Jio devices) revenue growth momentum was sustained on the back of a market-beating festive season and particularly strong performance in Tier 2 and 3 cities.

In grocery, while overall revenue was impacted by Covid restrictions, local issues and the decision to transition market stores into fulfilment centres, the continuing business delivered a healthy double-digit growth.

"With the Indian economy poised for a rapid recovery in 2021 after overcoming the Covid-19 constraints, Reliance Retail is confident of maintaining its industry-leading and market-beating performance," RIL said.