The latest financial report card for Mukesh Ambani’s Reliance Retail is out, and it turns out his retail empire is pandemic-proof! How?
Well, the consolidated revenue of Reliance Retail in fiscal Q2 2021 stood at ₹41,100 crores ($ 5.6 billion), with the net profit of ₹ 973 crore ($ 132 million). That being said, Reliance Retail revenue declined a negligible 0.49% year-on-year, while the net profit declined a notable 13.9% year-on-year during the quarter.
However, when compared with the previous quarter, the company reported an astonishing 125.8% QoQ growth in net profit and an appreciable 30% QoQ growth in its revenue.
Reliance Retail’s EBITA aka Earnings Before Interest, Taxes, Depreciation, and Amortization was observed to be at ₹2,006 crores during the second quarter of fiscal 2021, compared with ₹2,330 crores during the year-ago quarter.
The Chairman of RIL Mukesh Ambani, in a statement regarding the same, has said that the retail business activity in the country is on its way to normalization post the lockdown and is looking towards strong growth in key consumption markets.
Despite the on-going Covid-19 lockdown in the country, Reliance Retail managed to open 125 new physical stores, taking the total number of retail stores to 11,931. Interestingly, close to 85% of Reliance Retail stores have been either be fully or partially operational during the quarter, which is a sharp improvement from FY Q1 2021 wherein only 50% of their stores were reported to be functional.
In terms of footfall in the stores, the company revealed that it has been close to 75% this quarter which is up from 43% in the previous one. Footfall in September was reported to be around 85% of pre-COVID levels.
According to Dinesh Thapar, CFO of Reliance Retail the overall retail business in India is rebounding in a “sharp V-shape” trajectory and therefore as a company, they hope to ride the momentum of the market.
Currently, with JioMart consistently scaling up quickly and the arrival of the festive season, Reliance Retail can expect a speedy recovery in their profits. The company is aggressively pushing into the e-commerce space all thanks to them being knee-deep into sectors such as consumer electronics, grocery and fashion.
Lastly, their incessant fundraising and acquisitions are also being expected to contribute heavily to their coffers in the upcoming quarter.
In the previous quarter, Reliance Retail raised over a whopping $5 billion in investments for its ambitious e-commerce project JioMart which is currently expanding its presence in India’s lucrative grocery market. The company, during the same period, also acquired Netmeds, which is an online medicine delivery platform for ₹620 crores and announced its entry into the Pharma sector.
The Future Group deal was all set to give Mukesh Ambani the title of the ‘Retail King of India‘; however, now the future of the same materializing is stuck in limbo.
We have our eyes glued to what the next move of Reliance Retail will be and how the legal battle with the global e-commerce giant will affect the company financially. We will keep you updated on all future developments. Until then, stay tuned.