By Kosaku Narioka
Reliance Industries is scheduled to report second-quarter results on Friday. Here is what you need to know:
NET PROFIT FORECAST: Reliance Industries is expected to post a 32% rise in net profit to 180.83 billion rupees ($2.18 billion) for the three months ended Sept. 30, according to a poll of analysts by FactSet. That compares with a net profit of INR136.56 billion a year earlier.
WHAT TO WATCH:
–MOBILE BUSINESS: Reliance’s mobile and digital service business in July started selling Jio Bharat, a budget-friendly phone targeted toward new mobile internet users. Investors are focusing on the pace of growth in the business’s customer base and revenue. In its first quarter, the number of subscribers grew 6.8% from a year earlier to 448.5 million and average revenue per user per month increased 2.8% to INR180.5.
–RETAIL SEGMENT: Investors are paying attention to any strategic moves for Reliance’s retail unit after U.S. investment company KKR and Qatar Investment Authority recently invested in the business. First-quarter earnings before interest and taxes from the retail segment increased 27% from a year earlier to INR38.14 billion.
–DEBT BURDEN: Finance costs rose 46% from a year earlier to INR58.37 billion in Reliance’s first quarter, while its debt-service coverage ratio deteriorated to 1.66 from 4.11 a year earlier. Investors are closely watching the company’s debt burden as borrowing costs have increased.
Write to Kosaku Narioka at [email protected]
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