RIL Q2 FY27 results: Reliance beats estimates with record quarterly EBITDA, revenue up 25%

Reliance Industries Limited (RIL) posted a consolidated net profit of Rs 20,946 crore for the first quarter of FY27, a decline of 22% compared to the same period last year. The drop was largely attributed to an exceptional loss stemming from the sale of its stake in Asian Paints.

Revenue from operations, however, jumped 25% year-on-year, reaching an all-time high. The company's EBITDA also hit a record quarterly level, beating market estimates and providing a strong counterbalance to the profit decline.

Profit hit by one-time loss, but core operations shine

The net profit figure for Q1 FY27 includes an exceptional charge related to the divestment of RIL's stake in Asian Paints. Excluding this one-time impact, the company's underlying profitability was significantly stronger.

Analysts had widely expected a profit in the range of Rs 22,000-23,000 crore for the quarter. The reported net profit came in below that band due to the exceptional item, but the record EBITDA performance surprised to the upside.

RIL's consolidated EBITDA for the quarter stood at a record level, driven by margin expansion in its refining and petrochemicals business, as well as sustained growth in its retail and digital services segments.

Revenue surge led by retail and Jio

Revenue growth of 25% was broad-based, with the retail arm and Reliance Jio Infocomm providing the primary thrust. The retail business saw strong footfalls and higher average transaction values, while Jio continued to add subscribers and increase average revenue per user (ARPU).

The company's oil-to-chemicals (O2C) segment also contributed to the top line, benefiting from favorable crude oil prices and improved product margins. The digital services segment reported a double-digit rise in revenue, supported by data usage growth and tariff upgrades.

Operating leverage and cost optimization measures across all segments helped RIL achieve the record EBITDA margin, which came in above analyst consensus.

Balance sheet and capex update

RIL's net debt decreased sequentially during the quarter, aided by strong cash flows from operations. The company continued to invest in its new energy business, with capital expenditure remaining elevated in the solar and green hydrogen verticals.

Management has indicated that the new energy business will begin contributing to revenue in the coming quarters, with initial production from solar module manufacturing plants expected later this fiscal year.

Reliance's telecom arm, Jio, added 8 million net subscribers in Q1, while ARPU rose 3% quarter-on-quarter. The retail division opened 250 new stores during the period, expanding its footprint in tier-2 and tier-3 cities.

What analysts say

Brokerages have largely maintained a 'buy' rating on RIL following the results, citing the record EBITDA and revenue beat as key positives. The one-time profit drag from the Asian Paints stake sale is seen as a non-operating item that does not affect the company's underlying earnings trajectory.

Some analysts have flagged that the exceptional loss could weigh on near-term sentiment, but the robust operational performance across segments provides a strong buffer. The market will now focus on the trajectory of Jio's ARPU and the ramp-up of the new energy business.

RIL shares closed flat on the day of the results announcement, reflecting the mixed signals from the profit decline and the record EBITDA.

Investors will watch for management commentary on the timeline for the new energy projects and any further updates on the planned demerger of the financial services business in the coming weeks.