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New Delhi, Apr 30 () Oil-to-telecom conglomerate Reliance Industries on Thursday posted its biggest drop in quarterly net profit, even as it announced India's largest rights issue and said the Saudi Aramco deal was on track and more strategic investors have evinced interest in buying a stake in its digital platform. Net profit in January-March slipped 37 per cent to Rs 6,546 crore, the lowest in three years, as a rise in consumer-facing business was not enough to shield the firm from fall in the petrochemical business. The profit was also down due to one-off spending. The company's board approved a rights issue of Rs 53,125 crore, which it said was the biggest in India and the first by RIL in three decades. "The price of rights issue has been determined at Rs 1,257 per share and the share ratio at 1:15," the company said in a statement. On the back of last week's USD 5.7 billion (Rs 43,574 crore) Facebook investment in the company's recently created digital arm Jio Platform, Reliance Industries Ltd (RIL) said it is expected to complete capital raising of over Rs 1.04 lakh crore before June. Besides Facebook's 9.99 per cent investment in Jio Platforms and the upcoming rights issue, this fund includes Rs 7,000 crore that it got for selling 49 per cent stake in the fuel retailing business to BP plc of the UK. The company said it is in talks with other strategic and financial investors for a Facebook-sized deal in Jio Platform -- the unit that houses India's youngest but biggest mobile operator. Without revealing the identity of the companies, RIL in its fourth-quarter earnings statement said the investment would be announced in the coming months. The firm further said its board has approved hiving off its USD 75 billion worth oil-to-chemicals business into a separate division to enable the sale of a 20 per cent stake in the unit to Saudi Arabia's national oil company Saudi Aramco. The hiving off will be subject to the approval of the National Company Law Tribunal. "Saudi Aramco due diligence process is on track," it said, without giving timelines for completion of the deal. The firm's billionaire owner Mukesh Ambani had in August last year announced the deal as part of plans to cut debt at the firm to zero by March 2021. The deal was to conclude by March 2020. In the fourth quarter, the company said it had an exceptional item of Rs 4,267 crore which dented the profit. Revenue fell 2.5 per cent to Rs 151,209 crore. Net profit excluding exceptional items increased by 3.7 per cent to Rs 10,813 crore, it said. This is the second quarter in 2019-20 that saw a dip in profit. It had reported a quarter-on-quarter decline in Q1 FY20. Commenting on the results, Ambani, chairman and managing director of RIL, said: "Today I am pleased to announce that despite the daunting challenges arising from the fallout of the global pandemic, our company has once again delivered a resilient performance for FY 2019-20." "Our O2C (Oil to Chemicals) businesses delivered sustained earnings due to its integrated portfolio, cost-competitiveness, feedstock flexibility, and product placement capabilities. We continue to operate all our major facilities at near-normal utilisation levels," he said. The consumer-facing business of retail and telecom further strengthened their leadership positions and recorded robust growth on all operating and financial parameters during the year, he said. "We are fully committed on our investment plans in our consumer businesses and new initiatives. We are at the doorsteps of a huge opportunity and our rights issue and all other equity transactions will strengthen Reliance and position us to create substantial value for all our stakeholders," he said. While oil refining margins rose for the second consecutive quarter, the company opened 468 retail stores and added 26 per cent more subscribers to its Jio mobile phone service that helped increase the profitability of the venture. But the weakness in its traditional petrochemical businesses continued. The operator of the world's largest oil refining complex saw pre-tax earnings from the business rise 28.2 per cent to Rs 5,706 crore in the fourth quarter of the current fiscal year. It earned USD 8.9 on turning every barrel of crude oil into fuel, as compared to a gross refining margin (GRM) of USD 8.2 per barrel in January-March 2019. The GRM was, however, lower than USD 9.2 per barrel earned in Q3. With its retail store strength rising to 11,784 from 11,316 at the end of the third quarter, the retail business posted a 20 per cent jump in pre-tax profit to Rs 2,062 crore. Reliance Jio, the group's telecom arm, posted a standalone net profit of Rs 2,331 crore, which was 177.5 per cent more than the previous year, as subscriber base swelled to 387.5 million. Earning per subscriber rose to 130.6 per month from Rs 128.4 in the previous quarter. The petrochemical business saw pre-tax profit drop 24 per cent to Rs 4,553 crore on fall in product prices. Loss in the oil and gas exploration and production business widened to Rs 485 crore from Rs 267 crore in Q4 FY19. Having completed its major investment cycle, Reliance said its outstanding debt rose to Rs 336,294 crore as on March 31, 2020, from Rs 306,851 crore as on December 31, 2019. Cash in hand increased to Rs 175,259 crore from Rs 153,719 crore at the end of the December quarter. ANZ ANZ ABMABM

Reliance posts 37 pc drop in Q4 profit, announces Rs 53,125 cr rights issue

New Delhi, Apr 30 () Billionaire Mukesh Ambani's Reliance Industries Ltd (RIL) on Thursday announced fund raising of Rs 53,125 crore by way of a 1:15 rights issue, the first such issue in nearly three decades, as it steps up efforts to pare debt. One share will be offered for every 15 shares held at Rs 1,257, a 14 per cent discount to the closing price for April 30. In its earnings statement for fourth quarter, RIL said this would be India's biggest rights issue. The move comes within days of RIL agreeing to sell a 9.99 per cent stake in its digital platform to Facebook Inc for USD 5.7 billion or Rs 43,574 crore. Ambani had in August last year unveiled plans to cut debt to zero by 2021. As part of this plan, RIL has been seeking strategic partnerships across its businesses while targeting to deleverage the balance sheet. At the end of March quarter, RIL had an outstanding debt of Rs 3,36,294 crore. It also had cash in hand of Rs 1,75,259 crore, bringing the net debt position to Rs 1,61,035 crore. RIL said its board also approved a dividend of Rs 6.50 per equity share for the financial year ended March 31, 2020. It "approved the issuance of equity shares of Rs 10 each of the company of an issue size of Rs 53,125 crore by way of 'Rights Issue' to eligible equity shareholders of the company as on the record date." "The price for the Rights Issue has been determined at Rs 1,257 per share and the share ratio at 1:15," it said. "The proposed Rights Issuance will be the first by RIL in three decades. The issue will be structured as partly paid shares and will enable shareholders to phase out the outlay on their investment over a period of time." Typically, cash-strapped companies use rights issues to raise money when they really need it. In these rights offerings, companies grant shareholders the right, but not the obligation, to buy new shares at a discount to the current trading price. The last time RIL tapped the public for funds was in 1991 when it had issued convertible debentures. The debentures were subsequently converted into equity shares at Rs 55 apiece. As part of its balance sheet deleveraging plans, RIL is talking to Saudi Aramco for selling a fifth of its oil-to-chemicals business for an asking of USD 15 billion and has sold half of its fuel retail venture to BP Plc for Rs 7,000 crore and telecommunication tower business to Brookfield for Rs 25,200 crore. Together, proceeds from these transactions will result in a reduction in RIL's net debt. "The Board was also informed that the company expected to complete the capital raising programme totalling over Rs 1.04 lakh crore by Q1 of the current financial year. This includes the investment by Facebook in Jio Platforms, the upcoming rights issue, and the previous investment by British Petroleum in FY2019-20," RIL said. ANZ RVK

Reliance to raise Rs 53,125 cr via 1:15 rights issue at Rs 1,257 per share

New Delhi, Jun 25 () Fitch Ratings on Thursday said it has upgraded Reliance Industries Ltd's rating to 'BBB+' from 'BBB' as the company's financial profile has improved following sale of nearly 25 per cent stake in Jio and Rs 53,124 crore equity raise. "Fitch Ratings has upgraded India-based RIL's long-term local-currency issuer default rating (IDR) to 'BBB+' from 'BBB'. The Outlook is Stable," the ratings agency said in a statement. At the same time, the agency has affirmed RIL's long-term foreign-currency IDR at 'BBB-' with a stable outlook. 'BBB' ratings indicate that expectations of default risk are currently low. "The upgrade of the local-currency IDR is driven by our expectations of an improvement in RIL's financial profile, with net debt reductions underpinned by proceeds from a stake sale in its subsidiary, Jio Platforms Ltd, and a rights issue, and our forecast of positive free cash flow (FCF) during the financial year ending March 2021 (FY21)," it said. Fitch forecast that RIL's net debt/EBITDA will fall to 0.6x in FY21 from 2.3x in FY20. "RIL's local-currency IDR also reflects its strong business profile with a market leading position and diversified cash flows from a mix of oil to chemical and consumer businesses," the statement said. Fitch kept the stable outlook on RIL's foreign-currency IDR despite the revision in Indian sovereign's rating outlook to 'negative' from 'stable' on June 18, as it expected the company's hard currency (HC) external debt-service ratio to improve over the next 12 months. "Our expectation is driven by RIL's ability to reduce its foreign-currency borrowings outside India from the proceeds of the stake sale in Jio Platforms and its rights issue," it said. Fitch said proceeds of Rs 1.15 lakh crore from 24.7 per cent stake sale in Jio Platforms and the completion of its Rs 53,124 crore rights issue, with Rs 13,300 crore in cash received to date and the balance in FY22, would cut RIL's FY21 net leverage to well below 1.5x. It expected RIL's capital expenditure (capex) to fall from FY21 following the completion of most of its planned spending in its various business segments. The company's expansion of its fibre business is likely to be the major capex driver over the medium term, along with its investment in the domestic upstream business in a joint venture with BP plc over the next two-to-three years. FCF should turn positive in FY21, the first time since FY13, driven by robust operating cash flows, especially from its consumer businesses, and lower capex, it said. Fitch expects RIL's oil-to-chemical segments to face volume and margin headwinds due to a weakening of demand for refined products and petrochemicals in 2020, with gradual recovery through 2021 to pre-COVID-19 levels. Its telecom business, Reliance Jio Infocomm Ltd (Jio), is likely to be less affected by the coronavirus lockdown and contribute about 35 per cent of consolidated EBITDA in FY21 (from 26 per cent in FY20). Fitch said Jio's average revenue per user (ARPU) is expected to rise to Rs 147 in FY21 from Rs 131 in Q4 FY20. Also, 30 million subscribers are likely to be added in FY21 after 80 million additions in FY20. The rating agency expects RIL's retail segment revenue, excluding the digital-service business, to rise by 10 per cent in FY21 (compared to 15 per cent in FY20). "Retail revenue would be affected by lower footfall in its physical retail stores and a drop in spending on discretionary electronics and lifestyle products. "However, the impact will be mitigated by higher grocery sales and its partnership with Facebook, which allows users to buy goods and services using WhatsApp and Facebook Messenger," it added. ANZ ABM ABM

Fitch upgrades Reliance Industries' rating

New Delhi, May 4 () Shares of Reliance Industries (RIL) on Monday fell over 3 per cent after the company posted its biggest drop in quarterly net profit. The scrip of the company declined 3.22 per cent to Rs 1,419.75 on the BSE. On the NSE, it fell 3.31 per cent to Rs 1,417.45. The firm's net profit in January-March fell 37 per cent to Rs 6,546 crore, the lowest in three years, as a rise in consumer-facing business was not enough to shield the firm from fall in the petrochemical business. The profit was also down due to one-off spending. The company's board approved a rights issue of Rs 53,125 crore, which it said was the biggest in India and the first by RIL in three decades. "The price of rights issue has been determined at Rs 1,257 per share and the share ratio at 1:15," the company said in a statement on Thursday. Domestic equity markets were closed on Friday for 'Maharashtra Day'. Meanwhile, earlier in the day, Silver Lake - one of the world's largest tech investors - agreed to invest Rs 5,655.75 crore to buy a 1.15 per cent stake in Jio Platfroms. The announcement comes within days of Facebook's Rs 43,574 crore deal. SUM ANSANS

Reliance Industries shares fall over 3 pc after Q4 earnings

New Delhi, May 4 () Shares of Reliance Industries Ltd (RIL) on Monday fell over 2 per cent after the company posted its biggest drop in its quarterly net profit. The scrip of the country's most-valued firm closed 2.16 per cent lower at Rs 1,435.40 after declining 3.22 per cent to Rs 1,419.75 during the day on the BSE. On the National Stock Exchange (NSE), it fell 2.11 per cent to close at Rs 1,435. In terms of traded volume, 9.79 lakh shares were traded at the BSE and over 2 crore shares on the NSE during the day. The company's market valuation was at Rs 9,09,947.98 crore. The firm's net profit in January-March fell 37 per cent to Rs 6,546 crore, the lowest in three years, as a rise in consumer-facing business was not enough to shield the firm from fall in the petrochemical business. The profit was also down due to a one-off spending. The company's board approved a rights issue of Rs 53,125 crore, which it said was the biggest in India and the first by RIL in three decades. "The price of rights issue has been determined at Rs 1,257 per share and the share ratio at 1:15," the company said in a statement on Thursday. Domestic equity markets were closed on Friday on account of 'Maharashtra Day'. Meanwhile, earlier in the day, Silver Lake, one of the world's largest tech investors, agreed to invest Rs 5,655.75 crore to buy a 1.15 per cent stake in Jio Platforms. The announcement comes within days of Facebook's Rs 43,574 crore deal. SUM HRS

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Reliance posts 37 pc drop in Q4 profit, announces Rs 53,125 cr rights issue

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Reliance to raise Rs 53,125 cr via 1:15 rights issue at Rs 1,257 per share

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Fitch upgrades Reliance Industries' rating

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Reliance Industries shares fall over 3 pc after Q4 earnings

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Reliance Industries shares fall over 2 pc on Q4 earnings

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