Reliance Industries Q3 Results: O2C biz revenue grows 6%, Mukesh Ambani lauds segment’s 'innate resilience'

Reliance Industries Ltd. (RIL), a Nifty 50 heavyweight, announced its December quarter results on Thursday, January 16, with its oil-to-chemicals (O2C) business showing steady growth amid global energy market volatility.

O2C revenue rose nearly 6% year-on-year (YoY) to ₹1.49 lakh crore, up from ₹1.41 lakh crore in Q3 FY24. EBITDA for the segment increased by 2.4% YoY to ₹14,402 crore, compared to ₹14,064 crore in the same period last year. Margins, however, dipped slightly to 9.6% from 10%.

On a QoQ basis, the O2C segment reported a strong 16% rise in EBITDA to ₹14,402 crore, while margins improved to 9.6% from 8%.

The growth in the O2C business was underpinned by improved gross refining margins (GRMs), which climbed to $7.6 per barrel, compared to $5.6 in the previous quarter. Singapore GRMs also saw an uptick, rising to $5 per barrel from $3.6 in Q2 FY25. Brent crude prices averaged lower at $74.7 per barrel, down from $80.3 per barrel sequentially.

Despite supply and demand challenges in the petrochemical segment, O2C volumes improved, driven by efficient feedstock sourcing and higher domestic product placement. Analysts remain optimistic, with Morgan Stanley maintaining an 'overweight' rating on RIL and setting a price target of ₹1,662.

Also read: Reliance Industries Q3FY25 net profit rises over 7%, revenue at ₹2.40 lakh crore

Regarding the O2C business, Mukesh D. Ambani, Chairman and Managing Director, Reliance Industries Limited  noted its "innate resilience," with "refining margins recovering sequentially." He added that the "upstream segment continues to play a pivotal role." Looking ahead, he remarked that RIL is "geared up for transformational growth (and is) set to experience it in the near future."

On a consolidated basis, RIL reported a net profit of ₹18,540 crore in Q3 FY25, reflecting a 7% YoY growth from ₹17,265 crore in Q3 FY24. Consolidated revenue stood at ₹2.40 lakh crore, up 6% YoY from ₹2.25 lakh crore in the same period. Consolidated EBITDA rose 8% YoY to ₹43,789 crore, with the EBITDA margin improving marginally to 18.3% from 18.1% a year ago.

The Reliance Industries stock was up 1.1% today (January 16), and 4.2% since the start of the year (vs Nifty, which is down 1.4%), but still off 21% from 52-week highs of ₹1608.