Summary of the Reliance Industries Q2 FY25 conference call

                         Summary of the Reliance Industries Q2 FY25 conference call 

1. Consolidated Performance:
   • Revenue: Rs. 2,58,027 crores (up 0.8% YoY)
   • EBITDA: Rs. 43,934 crores (down 2% YoY)
   • PAT: Rs. 19,323 crores (down 2.8% YoY)
   • Robust growth in digital services and upstream, offset by weak O2C performance
   • Retail showed steady performance with focus on enhancing customer proposition and strengthening capabilities
2. Digital Services (Jio):
   • Revenue: Rs. 31,709 crores (up 18% YoY)
   • EBITDA: Rs. 15,931 crores (up 18% YoY)
   • Subscriber base: 478.8 million (slight decline due to SIM consolidation)
   • ARPU: Rs. 195.1 (up 7.4% YoY)
   • 148 million subscribers migrated to 5G, contributing 34% of wireless data traffic
   • Total data traffic: 45 Exabytes (up 24% YoY)
   • Launched JioAirFiber, reaching 2.8 million subscribers
   • Introduced JioAICloud and Jio Brain AI development platform
   • Expanded enterprise offerings including SIP-based voice services and managed WiFi
3. Retail:
   • Revenue: Rs. 76,302 crores (down 1.1% YoY)
   • EBITDA: Rs. 5,850 crores (up 0.3% YoY)
   • PAT: Rs. 2,935 crores (up 5.2% YoY)
   • EBITDA margin from operations: 8.5% (up 40 basis points)
   • Opened 464 new stores, total count 18,946
   • Total operational area: 79.4 million sq ft (up 11%)
   • Focused on streamlining operations and improving margins
   • Digital and new commerce contribution: 17% of total revenues
   • Entered partnership with Delta Galil for lingerie business
   • Launched ASOS in India
   • Expanded Yousta format to 50 stores
   • Launched first Armani/Caffè in India
4. Oil & Gas (E&P):
   • Highest quarterly EBITDA: Rs. 5,290 crores
   • EBITDA margin: 85% (up 1,300 bps YoY)
   • Steady production from KGD6 at 28.5 million SCM
   • Increased production from CBM wells
   • Ceiling price for gas revised to $10.16/MMBtu for second half of FY25
5. O2C (Oil to Chemicals):
   • Revenue: Rs. 1,56,000 crores (up 5% YoY)
   • EBITDA: Rs. 12,413 crores (down 24% YoY)
   • Impacted by weak demand and lower margins in downstream chemicals
   • Transportation fuel cracks down ~50% YoY
   • Benefited from ethane cracking economics and improved domestic fuel retailing
   • Domestic fuel retailing volumes up 28% YoY
   • Won Global Water Tech award for smart water and water conservation project in Jamnagar
6. Operational Highlights:
   • Continued investments in technology to improve customer experience and infrastructure
   • Expanded digital commerce and hyperlocal deliveries through store network
   • Launched new product categories and expanded merchant base in own brand business
   • Steady growth in jewellery business despite higher gold prices
   • Expansion of premium formats like FreshPik and Fresh signature
   • Scaling up of consumer brands business with 250%+ YoY growth in general trade revenues
7. Balance Sheet and Investments:
   • Strong cash flow and liquidity position maintained
   • CAPEX at Rs. 34,000 crores, covered by cash profits
   • Continued investments in technology, supply chain, and distribution infrastructure
8. Future Outlook (Detailed):

a) Digital Services:

• Expect continued growth in 5G adoption and data consumption
• Focus on expanding JioAirFiber services and targeting 1 million new home connections per month
• Further development and commercialization of AI services through JioAICloud and Jio Brain
• Continued expansion of enterprise offerings and SMB segment penetration

b) Retail:

• Anticipate strong growth momentum in festive season (October-November)
• Expect to revert to industry-leading growth rates after 1-2 quarters of streamlining operations
• Continue expansion of Yousta format and other new store concepts
• Focus on improving design capabilities and reducing design-to-shelf cycle
• Expansion of premium and luxury brand portfolio, including F&B offerings
• Further scaling of consumer brands business and expansion of distribution network

c) Oil & Gas:

• Expect improvement in gas production, particularly from CBM
• Anticipate higher gas prices in the second half of FY25
• Forecast strong gas demand due to potential harsh winter and delay in new LNG terminal startups

d) O2C:

• Expect continued volatility in oil prices and downstream product margins
• Anticipate potential improvement in margins if economic stimulus measures are implemented, particularly in China
• Monitor geopolitical factors and OPEC policies that may impact supply and demand dynamics
• Focus on operational optimization and cost management to mitigate margin pressures

e) Overall Business Strategy:

• Continue strengthening of tech platforms across all business segments
• Maintain focus on streamlining operations and calibrated approach to B2B business
• Expect underlying business themes to remain strong, with potential volatility in the next 1-2 quarters
• Anticipate return to industry-leading momentum across segments after current optimization phase

f) Market and Economic Factors:

• Monitor global economic conditions, particularly in China, US, and EU, which may impact demand
• Watch for potential monetary policy changes and economic stimulus measures in key markets
• Prepare for possible impact of rising EV penetration on gasoline demand, particularly in China
• Anticipate potential growth in air travel and consequent increase in jet fuel demand

g) Sustainability and Innovation:

• Continue focus on water conservation and sustainability initiatives across operations
• Further development of AI capabilities and integration into various business segments
• Explore new opportunities in renewable energy and circular economy initiatives