<ul><li>Analysts have warned that if the average revenue per user does not improve, <keyword id="2003276" type="PERSON" weightage="20" keywordseo="Jio">Jio</keyword> may go for a tariff hike. </li><li><keyword id="6354504" type="PERSON" weightage="20" keywordseo="reliance-jio">Reliance Jio</keyword> has reported a profit decline of nearly 4% with net profit of ₹3,508 crore.</li><li>During the March quarter, Jio added over 15 million new subscribers, after a disappointing December quarter.</li><li>Jio also witnessed a major slump in average revenue per user (ARPU), which fell to ₹138.2, a decline of over 8%.</li></ul>The half a percentage point growth in Reliance Jio’s net profit is not exciting, at all. What’s worse is that the average revenue per user (ARPU) is the least in the last four quarters. Analysts have warned that if the average revenue per user does not improve, <a href="https://www.businessinsider.in/business/telecom/news/reliance-jio-needs-tariff-hikes-to-sustain-earnings-growth-as-subscriber-additions-slow-down/articleshow/82289799.cms">Jio may go for a tariff hike</a>. <cmsannotation type="cmsannotation" annotationid="Jio’s ARPU is the lowest in the last four quarters" comment="subhead" text="Jio’s ARPU is the lowest in the last four quarters">Jio’s ARPU is the lowest in the last four quarters</cmsannotation> <div type="image" title="Jio ARPU Q4 FY21." msid="82331317" hostid="261" caption="&amp;lt;p&amp;gt;Jio&amp;#39;s ARPU has seen a major decline&amp;lt;/p&amp;gt;"></div> Two other factors weighing down on the profit are affordable postpaid plans and JioPhone, which attracts low average revenue per user (ARPUs). Both the new phone and the cheaper postpaid plans were rolled out in Oct-Dec 2020, and they are now weighing down the financials. <div type="Article" hostid="261" msid="82330913" title="Here’s how Mukesh Ambani’s Reliance Industries more than doubled its quarterly profit" mstype="2" mssubtype="0"></div> Reliance Jio has added three times more subscribers between Jan-March 2021 compared to the preceding three months. But most of them are low-paying users, who use Jio as a second phone for cheaper plans, and therefore the subscriber addition is not adding to the revenue or the profit in a big way. <div type="image" title="Jio subscribers + net addition Q4 FY21." msid="82331617" hostid="261" caption="&amp;lt;p&amp;gt;Jio&amp;#39;s new subscriber additions have seen a recovery&amp;lt;/p&amp;gt;"></div> “We believe Reliance Jio should be comfortable taking tariff hike if the current market structure is maintained, wherein it provides more value for money to subscribers compared to peers. This structure would ensure Jio grows its subscribers faster,” stated an ICICI securities report dated April 8, 2021. <cmsannotation type="cmsannotation" annotationid="Reliance Jio’s last quarter in numbers" comment="subhead" text="Reliance Jio’s last quarter in numbers">Reliance Jio’s last quarter in numbers</cmsannotation> Reliance Jio, India’s largest telecom provider has reported a 0.5% increase in profit between January and March 2021, increasing marginally to ₹3,508 crore from ₹3,489 crore in the previous quarter. Jio also witnessed a slump in its revenue during the quarter, falling to ₹18,278 crore as compared to ₹19,475 crore in the quarter before. This is a fall of 5.3%. <div type="image" title="Jio Net Profit Q4 FY21." msid="82331375" hostid="261" caption="&amp;lt;p&amp;gt;Jio&amp;#39;s net profit over the last eight quarters&amp;lt;/p&amp;gt;"></div> Data traffic saw an increase of 5.2% compared to the previous quarter. The average data usage per user during the quarter stood at 13.3GB, as compared to 12.9GB in the previous quarter. Voice usage also witnessed moderate increase of over 3%, jumping to 823 minutes from 796 minutes in the quarter before. It remains to be seen if Jio increases its tariffs to recover the slump in its ARPU. <div type="image" title="Jio voice and data usage Q4 FY21." msid="82331409" hostid="261" caption="&amp;lt;p&amp;gt;Jio&amp;#39;s consumer engagement numbers over the last eight quarters&amp;lt;/p&amp;gt;"></div> SEE ALSO: <a href="https://www.businessinsider.in/business/telecom/news/reliance-jio-needs-tariff-hikes-to-sustain-earnings-growth-as-subscriber-additions-slow-down/articleshow/82289799.cms">Look for this number in Reliance Jio’s earnings⁠ — it will tell you if the tariff will rise</a> <a href="https://www.businessinsider.in/business/telecom/news/airtel-adds-3-times-more-subscribers-than-reliance-jio-vodafone-idea-turns-positive-for-the-first-time-in-15-months/articleshow/81562851.cms">Airtel adds 3 times more subscribers than Jio while Vodafone Idea gets net addition first time in 15 months</a> <a href="https://www.businessinsider.in/business/telecom/news/how-the-latest-spectrum-auction-may-affect-your-mobile-phone-bills-and-quality-of-network-service/articleshow/81325496.cms">Here’s how the latest spectrum auction may affect your mobile phone bills and quality of service</a>

Reliance Jio is making less money off its subscribers than it did 12 months ago

<ul><li>The Mukesh Ambani-owned company reported its earnings for the last three months ending December 2019.</li><li>The share price of Reliance Industries (RIL) has run up over 40% since the lows it hit in August 2019.</li><li>These are some of the highlights from the earnings report from one of India's most-valued companies which has businesses spanning from oil and gas exploration to telecom to retail.</li></ul>The Mukesh Ambani-owned company reported its earnings for the last three months ending December 2019. Consolidated revenue was at ₹1.53 lakh crore, and profit was ₹11,640 crore compared to a year earlier with a 1% growth in earnings before interest, tax, depreciation, and amortisation (EBITDA) to over ₹22,386 crore. The big boost has come from the retail business while the petrochemicals business performance disappointed. The gross refining margin came in at $9.2 a barrel. These consumer businesses i.e. retail and telecom make for 37% of the conglomerate's EBITDA compared to less than 1% five years ago, Chief Financial Officer Alok Agarwal said in a statement after the earnings. "The revenue and profit from retail for the first nine months of the current fiscal are more than the full-year figures of the last financial year," he added. <table style="border-width: initial; border-style: none; background-color: rgb(255, 255, 255); font-size: 16px; line-height: 1.6em; box-shadow: none; width: 152pt; font-family: Merriweather; padding-bottom: 10px !important; background-image: inherit !important; background-position: inherit !important; background-size: inherit !important; background-repeat: inherit !important; background-attachment: inherit !important; background-origin: inherit !important; background-clip: inherit !important;"><colgroup></colgroup><colgroup></colgroup><colgroup></colgroup><col /><tbody><tr><td class="xl65" style="border-width: 1px; border-style: solid; border-color: rgb(221, 221, 221); padding: 5px; font-size: 16px; vertical-align: top; height: 15pt; width: 76pt;">Segment</td><td class="xl66" style="border-top: 1px solid rgb(221, 221, 221); border-right: 1px solid rgb(221, 221, 221); border-bottom: 1px solid rgb(221, 221, 221); border-left: none rgb(221, 221, 221); padding: 5px; font-size: 16px; vertical-align: top; width: 76pt;">EBITDA Growth</td></tr><tr><td class="xl67" style="border-top: none rgb(221, 221, 221); border-right: 1px solid rgb(221, 221, 221); border-bottom: 1px solid rgb(221, 221, 221); border-left: 1px solid rgb(221, 221, 221); padding: 5px; font-size: 16px; vertical-align: top; height: 15pt;">Retail</td><td class="xl69" style="border-top: none rgb(221, 221, 221); border-right: 1px solid rgb(221, 221, 221); border-bottom: 1px solid rgb(221, 221, 221); border-left: none rgb(221, 221, 221); padding: 5px; font-size: 16px; vertical-align: top;">62.30%</td></tr><tr><td class="xl67" style="border-top: none rgb(221, 221, 221); border-right: 1px solid rgb(221, 221, 221); border-bottom: 1px solid rgb(221, 221, 221); border-left: 1px solid rgb(221, 221, 221); padding: 5px; font-size: 16px; vertical-align: top; height: 15pt;">Digital services</td><td class="xl69" style="border-top: none rgb(221, 221, 221); border-right: 1px solid rgb(221, 221, 221); border-bottom: 1px solid rgb(221, 221, 221); border-left: none rgb(221, 221, 221); padding: 5px; font-size: 16px; vertical-align: top;">43.50%</td></tr><tr><td class="xl68" style="border-top: none rgb(221, 221, 221); border-right: 1px solid rgb(221, 221, 221); border-bottom: 1px solid rgb(221, 221, 221); border-left: 1px solid rgb(221, 221, 221); padding: 5px; font-size: 16px; vertical-align: top; height: 15.75pt;">Refining</td><td class="xl70" style="border-top: none rgb(221, 221, 221); border-right: 1px solid rgb(221, 221, 221); border-bottom: 1px solid rgb(221, 221, 221); border-left: none rgb(221, 221, 221); padding: 5px; font-size: 16px; vertical-align: top;">11.70%</td></tr></tbody></table> The revenue from petrochemicals fell over 4%, while the EBITDA fell over 19% due to a fall in prices of products. A key product, Ethylene prices weakened and reached near 10 -year low with ample supply post start-up of new ethylene export facility in US and new ethane-based crackers in US. "The third quarter results for our energy business reflects the weak global economic environment and volatility in energy markets. Within our O2C chain, downstream petrochemicals profitability was impacted by weak margins across products with subdued demand in well-supplied markets. Refining segment performance improved in a difficult operating environment given our continuous focus on cost positions, high operating rates and product placement," Chairman Mukesh Ambani said. The share price of Reliance Industries (RIL) has <a href="https://www.businessinsider.in/business/corporates/article/the-real-story-behind-reliance-industries-spectacular-40-bn-bull-run/articleshow/73321847.cms?src=hp_latest" data-type="tilCustomLink" target="_blank">run up over 40% since the lows it hit in August 2019</a>. 
 
 
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 These are some of the highlights from the earnings report from one of India's most-valued companies which has businesses spanning from oil and gas exploration to telecom to retail. 1. Reliance Retail posts a 62% jump in profits as the company is on store-opening spree taking the total count to 11,316 across India. "We had over 176 million customers walk into our stores during this quarter with registered customers at 117 million, growing 42.6% over the same period last year," the CFO added. 2. The average revenue per user went up 7% while the subscriber addition was at 14.8 million during the three months. Net Profit from Reliance Jio increased by 63.1% to ₹1,360 crore compared to a year earlier. "As we increased tariff, and started charging for inter-connection, a lot of marginal users who used Jio mostly for voice calls have moved out of the network," CFO Agarwal said. 3. The impact of Supreme Court's verdict: Liability towards license fees/spectrum usage charges will be ₹177 crore. 4. Net debt reduced sequentially. For the first time in 20 quarters, consolidated cash profits exceeded capital investments. 5. After 25 years of operating the Panna-Mukta oil and gas fields, the Panna-Mukta and Tapti (PMT) Joint Venture partners has handed over the Panna-Mukta oil and gas fields back to the Government of India’s nominee i.e. Oil and Natural Gas Corporation (ONGC) on 21st December 2019. 6. RIL’s exports of refined products from India were at $6.1 billion during the quarter compared to $ 6.9 billion same time last year. In terms of volume, exports of refined products were 10.6 million metric tonnes (MMT) compared to 10.8 MMT a year earlier. One of the factors that hit the energy market was the reduction of inventory due to the US-China trade war, the management explained. 7. Polyester producers in China slashed prices to off-load the rising stocks, leading to bouts of brisk sales at low prices. 8. KG-D6 field produced 4.96 BCF of natural gas in 3Q FY20, lower by 18.4% compared to a year earlier and down 9% from three months ago. SEE ALSO: <a href="https://www.businessinsider.in/business/startups/news/reliance-backed-startup-fynd-visual-recommendation-engine-will-let-you-shop-through-images/articleshow/73222011.cms" data-type="tilCustomLink" target="_blank">This Reliance-backed startup will soon let you pause a movie and buy what the actor is wearing</a> <a href="https://www.businessinsider.in/business/ecommerce/news/jiomart-launch-date-january-26-mukesh-ambani-ecommerce-debut-will-include-electronics/articleshow/73141917.cms" data-type="tilCustomLink" target="_blank">EXCLUSIVE: JioMart will launch mobile phones and electronics on January 26 and soon, everything under the sun in e-commerce</a>

Reliance Jio and Reliance Retail boost earnings for Mukesh Ambani-owned RIL

<ul><li>According to Axis Securities, brands like Lifebuoy alcohol-based sanitizer, Domex, Surf excel are expected to see heavy sales growth. </li><li><keyword id="44863" type="CITY" weightage="20" keywordseo="HUL">HUL</keyword> shares have gained over 23% even in the volatile market since March 23, when the lockdown started. </li><li>Analysts think with the rise in the packaged food holding on to the tea business will be beneficial for HUL.</li></ul><keyword id="6365619" type="COMPANY" weightage="20" keywordseo="hindustan-unilever">Hindustan Unilever</keyword> (HUL) became India’s first fast-moving consumer goods (<a href="https://m.economictimes.com/markets/stocks/news/huls-on-a-roll-m-cap-crosses-rs-500000-crore/articleshow/75038834.cms">FMCG) company with a market cap above $5 trillion</a> after the merger with GlaxoSmithKline (GSK). Analysts at Edelweiss Securities described as a match ‘made in heaven’. The first quarter earnings of India’s largest consumer products maker HUL may prove if it was the right call. Investors are, however, hoping for the best. The stock has surged 8% in the last two weeks before the earnings on July 21. <div type="image" title="HULshare" msid="77064535" hostid="261"></div> Hope floats that the GSK merger gave HUL the capabilities in clinical research, product development, stronger portfolio at the pharmacy channel and a direct connect with doctors and experts, according to Edelweiss. This was the time when consumer demand fell overall but there was a mad scramble for sanitisers and disinfectants. According to Axis Securities, brands like Lifebuoy alcohol-based sanitizer, Domex, Surf excel are expected to see strong sales growth. According to various <a href="https://www.business-standard.com/article/markets/hul-q1-preview-gsk-acquisition-the-lower-tax-rate-to-support-profit-120072000398_1.html">analysts reports</a>, HUL is projected to see a revenue dip of nearly 2% but will see a healthy rise in its profit. <table style="border-width: initial; border-style: none;"><colgroup></colgroup><col /><col /><col /><tbody><tr><td style="border-left:solid #000000 0.9960975000000001pt;border-right:solid #000000 0.9960975000000001pt;border-bottom:solid #000000 0.9960975000000001pt;border-top:solid #000000 0.9960975000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Brokerage </td><td style="border-left:solid #000000 0.9960975000000001pt;border-right:solid #000000 0.9960975000000001pt;border-bottom:solid #000000 0.9960975000000001pt;border-top:solid #000000 0.9960975000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Revenue </td><td style="border-left:solid #000000 0.9960975000000001pt;border-right:solid #000000 0.9960975000000001pt;border-bottom:solid #000000 0.9960975000000001pt;border-top:solid #000000 0.9960975000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Net Profit </td></tr><tr><td style="border-left:solid #000000 0.9960975000000001pt;border-right:solid #000000 0.9960975000000001pt;border-bottom:solid #000000 0.9960975000000001pt;border-top:solid #000000 0.9960975000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">ICICI Securities </td><td style="border-left:solid #000000 0.9960975000000001pt;border-right:solid #000000 0.9960975000000001pt;border-bottom:solid #000000 0.9960975000000001pt;border-top:solid #000000 0.9960975000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2.40% </td><td style="border-left:solid #000000 0.9960975000000001pt;border-right:solid #000000 0.9960975000000001pt;border-bottom:solid #000000 0.9960975000000001pt;border-top:solid #000000 0.9960975000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">7.90% </td></tr><tr><td style="border-left:solid #000000 0.9960975000000001pt;border-right:solid #000000 0.9960975000000001pt;border-bottom:solid #000000 0.9960975000000001pt;border-top:solid #000000 0.9960975000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Edelweiss Securities </td><td style="border-left:solid #000000 0.9960975000000001pt;border-right:solid #000000 0.9960975000000001pt;border-bottom:solid #000000 0.9960975000000001pt;border-top:solid #000000 0.9960975000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2% </td><td style="border-left:solid #000000 0.9960975000000001pt;border-right:solid #000000 0.9960975000000001pt;border-bottom:solid #000000 0.9960975000000001pt;border-top:solid #000000 0.9960975000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2.80% </td></tr><tr><td style="border-left:solid #000000 0.9960975000000001pt;border-right:solid #000000 0.9960975000000001pt;border-bottom:solid #000000 0.9960975000000001pt;border-top:solid #000000 0.9960975000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Nirmal Bang </td><td style="border-left:solid #000000 0.9960975000000001pt;border-right:solid #000000 0.9960975000000001pt;border-bottom:solid #000000 0.9960975000000001pt;border-top:solid #000000 0.9960975000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2.30% </td><td style="border-left:solid #000000 0.9960975000000001pt;border-right:solid #000000 0.9960975000000001pt;border-bottom:solid #000000 0.9960975000000001pt;border-top:solid #000000 0.9960975000000001pt;vertical-align:bottom;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2.30% </td></tr></tbody></table> Even packaged food is likely to see a spike in sales In January, HUL and its parent company Unilever were debating whether to hold on to its tea business in India and Indonesia, <a href="https://www.bloombergquint.com/business/huls-india-brands-in-spotlight-as-parent-unilever-puts-global-tea-business-under-review#:~:text=For%20HUL%2C%20tea%20contributed%2019,six%20months%20ended%20September%202019.&amp;text=Brooke%20Bond%20Red%20Label%2C%203,its%202018%2D19%20annual%20report.">according to a Bloomberg report</a>. The business stayed on and for good. Tea and food refreshments— which account for 19% of the company’s FY20 revenue— could also clock decent growth between April and June. Analysts think with the rise in the packaged food holding on to the tea business will be beneficial for HUL. According to the company’s financial reports, tea and food refreshment business account for 19% of the company’s total revenues for the financial year 2020. The company saw the opportunity and spent money on capitalising on it. It’s ‘Dooriyan Banakar Bhi Apnapan Dikha Sakte Hain’ campaign for Brooke Bond Red Label tea targeted people who were missing the short tea breaks with colleagues and friends during the lockdown. According to the BARC report, HUL continued to be the top advertiser of its products during the pandemic. SEE ALSO: <a href="https://www.businessinsider.in/business/news/mukesh-ambani-owned-reliance-jio-compared-to-alibaba-and-tencent/articleshow/77059624.cms" data-type="tilCustomLink" style="">If Alibaba and Tencent are rolled into one, it may look a lot like Mukesh Ambani’s Reliance Jio ⁠— only much smaller for now</a> <a href="https://www.businessinsider.in/india/news/air-india-pilots-are-up-in-arms-after-the-national-airline-unilaterally-declared-leave-without-pay/articleshow/77063958.cms" data-type="tilCustomLink">Air India pilots are up in arms after the national airline ‘unilaterally’ declared ‘leave without pay’</a>

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Reliance Jio is making less money off its subscribers than it did 12 months ago

Rounak Jain

Reliance Jio and Reliance Retail boost earnings for Mukesh Ambani-owned RIL

Sriram Iyer

Chai and sanitiser may save the quarter⁠ for Hindustan Unilever

Navdeep Yadav