In a bid to improve coverage and address quality issues, Reliance Industries will invest an additional ₹30,000 crore to ramp up telecom arm Jio’s network. These investments are proposed to be financed largely through an equity offering, via a rights issue.
“Jio has the widest and most extensive 4G network in India. It is being expanded to cover over 90 per cent of the population shortly,” Reliance said while announcing its quarterly numbers.
Profit growth at Reliance Industries slowed in the December quarter, rising 3.6 per cent to ₹7,506 crore. Benchmark Brent crude prices have risen 13 per cent in the last three months, and revenue from the sale of refined petroleum products account for about two-thirds of RIL’s topline.
Gross refining margin (the difference between the cost of crude oil and the average selling price of refined products) stood at $10.8 a barrel, lower than the $11.5 reported for the December 2015 quarter. The GRM is a a key profitability gauge. The Jamnagar refinery processed 17.8 million tonnes of crude in the three-month period, less than in the preceding quarter. Revenue from refining stood at ₹61,693 crore.
In a statement, Mukesh Ambani, Chairman and MD, RIL, said: “The refining business has delivered eight consecutive quarters of double-digit GRMs, benefiting from the global demand for transportation fuels and improved product cracks.”
Revenue from the petrochemical business rose 17.8 per cent to ₹22,854 crore, primarily due to an increase in prices across the polymer and polyester chain. With the company’s focus on oil and gas exploration in gradual decline, revenue from this segment fell 31 per cent to ₹1,215 crore, due to lower production and lower gas prices.
Organised retail has been emerging as the new revenue spinner, rising 47.2 per cent to ₹8,688 crore.
Rjio’s gross debt stood at ₹49,000 crore as of December-end, and it had a deferred liability of about ₹21,000 crore to the government on account of spectum allocation.