Reliance Retail clocks nearly as much revenue as a year earlier as COVID shock abates ⁠— but the Amazon threat looms

• Reliance Retail posted a 13.9% year-on-year fall in profit at the end of the second quarter of the current financial year.
• The revenue from the retail segment stood at ₹41,100 crore.
• Mukesh Ambani’s retail segment emerged with higher revenues on a quarter-on-quarter basis but continued to fall short on a yearly basis.

Mukesh Ambani’s Reliance Retail posted a 13.9% year-on-year fall in profit at the end of the second quarter of the current financial year. For the quarter, the retail segment’s Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) stood at ₹2,006 crore a fall from ₹2,330 crore in the same quarter the previous year.

The revenue from the retail segment stood at ₹41,100 crore, that’s nearly as much as the ₹41,202 crore clocked between July and September 2019. “Retail business activity has normalised with strong growth in key consumption baskets as lockdowns ease across the country,” Mukesh Ambani, Chairman, RIL said in a statement. The total number of stores stood 11,931 with an addition of 125 stores during the quarter.


With the festive season and consumer goods recovering fast and e-commerce sales shooting up, Reliance Retail with its hands stretched across sectors like consumer electronics, grocery and fashion also got a piece of the pie. The company said that JioMart continues to scale-up rapidly with consistent increase in daily customer orders.

“With the continued thrust on digital commerce, 100% of Trends stores were omni-enabled. AJIO scaled new highs with 4x growth in orders from pre-COVID levels. Its quarterly revenue run rate is now equivalent to full last year’s revenue,” said the company.

Investments, acquisitions and a legal battle on Reliance Retail’s report card

In the last three months, Reliance Retail has swarmed into India’s $700 billion industry with the much-talked about acquisition of Kishore Biyani’s Future Group, has raised over $5 billion in investments, and its e-commerce bet – JioMart has solidified its presence in India’s booming online grocery market. During the quarter, Reliance also acquired Netmeds for ₹620 crore and marked its entry into the pharma sector.

Reliance Retail: The flurry of global investments

In the second quarter, Reliance also finalised its acquisition of Future Group for ₹25,000 crore. The deal was set to give Ambani the tag of king of India’s retail, however it has hit pause as global e-commerce giant Amazon has taken Future Group to court. Amazon has won the arbitration in Singapore, while Reliance and Future are determined to close the deal. However, the impact of the legal battle will only be seen in the third quarter of the current financial year.


SEE ALSO:
Future Retail-Reliance deal: BSE to consult SEBI after Amazon's request — Here’s all that has happened so far