Reliance Retail’s profit more than halves but Mukesh Ambani puts the spotlight on surging orders on JioMart
- Mukesh Ambani’s
Reliance Retailhas not been spared from the impact of the coronavirus lockdown.
- Reliance Retail’s revenue for the quarter stood at ₹31,633 crore, while the net profit for the quarter stood at ₹431 crore.
- Ambani’s e-commerce bet –
JioMartclocked big numbers during the lockdown – over 400,000 orders on a single day
AdvertisementMukesh Ambani’s Reliance Retail has not been spared from the impact of the coronavirus lockdown. Reliance Retail profits have fallen by 59.5%, as the profit before interest, tax and the exceptional item for the first quarter stood at ₹722 crore, a massive fall from ₹1786 crore in the same quarter the previous year.
Reliance Retail’s revenue for the quarter stood at ₹31,633 crore, while the net profit for the quarter stood at ₹431 crore.
“Our consumer facing businesses became the life-line for individuals and businesses with our Retail and Jio teams working hard to ensure millions got essential goods and services through the lockdown,” said Mukesh Ambani, Chairman and Managing Director, Reliance Industries.
Grocery helps retail survive
Grocery helped the retail arm with the company witnessing a 21% growth year-on-year in the operational business of grocery in first quarter.”Consumer electronics and fashion and lifestyle businesses were hit particularly hard by the cessation of activity during the lockdown period, as stores were closed for the most part of the quarter,” said the company’s statement.
Ambani’s e-commerce bet, JioMart clocked in big numbers during the lockdown – the company claimed it received over 4 lakh orders on a single day. And now, expansion plans for JioMart are underway. According to a Goldman Sachs report, JioMart is poised to sell half of all online grocery in India, which is expected to see 5 million orders every day by 2024.
“A hallmark of the quarter was the significant and swift progress across the breadth of the business on activating digital commerce and strengthening omni-channel capabilities, to supplement the strength of the existing offline store network,” said Reliance.
After Jio’s big-ticket fundraising that has caught the market’s fancy, the next round of unlocking potential value is likely to come from the retail vertical, which is also headed for an initial public offering (IPO) soon.
Ambani in his speech during Reliance’s Annual General Meet had mentioned that talks are on with potential investors for retail. All of this, the performance, the plan and the execution, will decide how much the investors are willing to pay for the stake.
Reliance Retail employs nearly 1.4 lakh people, and has 11,806 stores all across 7,000 cities selling everything from food and grocery, consumer electronics, to fashion and lifestyle.
AdvertisementThe total store area was up by 26% year-on-year from 23 million square feet to 29 million square feet.
RIL has a sobering quarter— if not for Jio and BP stake sale it would have been much worse
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