Reliance Jio Q3 Profit Rises 28% YoY To INR 4,881 Cr, ARPU At INR 178.2

Some PE Investors In Reliance Jio May Look For An Exit Soon, Says Bernstein

SUMMARY

On a sequential basis, the net profit of Jio Platforms increased by 3.2% from INR 4,729 Cr in Q2 FY23

Reliance Jio’s average revenue per user (ARPU) rose marginally sequentially to INR 178.2 from INR 177.2 in the previous quarter

EBITDA margin expanded 170 basis points due to higher ARPU and benefit from lower spectrum usage charges

India’s largest telecom operator Reliance Jio on Friday (January 20) reported a 28% rise in its net profit to INR 4,881 Cr in the third quarter of the financial year 2022-23 (Q3 FY23) from INR 3,795 in Q3 FY22 on an increase in subscriber base and margin improvement.

On a sequential basis, the net profit of Jio Platforms, the subsidiary of Reliance Industries Ltd (RIL) which houses telecom company Reliance Jio Infocomm, increased by 3.2% from INR 4,729 Cr in Q2 FY23.

The telco reported a customer base of 432.9 Mn in the latest quarter, up 1.2% sequentially and 3% YoY. The slow rise in customer base is to be expected as Bharti Airtel continues to remain on the toes of the Akash Ambani-led telecom giant.

Jio’s gross revenue rose 21% to INR 29,195 Cr in Q3 FY23 from INR 24,176 Cr in the year-ago quarter. Similarly, revenue from operations also rose 21% to INR 24,892 Cr from INR 20,597 Cr in Q3 FY22.

Reliance Jio saw its average revenue per user (ARPU) rise marginally sequentially to INR 178.2 from INR 177.2 in the previous quarter. However, ARPU grew 17.5% on a year-on-year (YoY) basis.

Earnings before interest, tax, depreciation and amortisation (EBITDA) rose 25.1% YoY to INR 12,519 Cr due to an increase in subscriber base and ARPU for the connectivity business.

Meanwhile, the EBITDA margin expanded 170 basis points due to higher ARPU and benefit from lower spectrum usage charges. Incidentally, the telecom ministry removed the requirement to pay spectrum usage charges on the 5G spectrum acquired by telcos last year, which has resulted in cash flow benefits to all the telcos, not just Reliance Jio.

Speaking of 5G, Jio has already spread out 5G to 134 cities across 22 states and union territories (UTs). “Jio remains on track to complete its pan India 5G rollout by December 2023,” the telco said.

Akash Ambani, chairman of Reliance Jio, said, “Jio is undertaking the most ambitious and fastest ever 5G rollout plan for any country of our size. Within three months of launch, Jio True5G is now available across 134 cities and would be available across India by December 2023. In addition, Jio will connect over 100 Mn premises with JioFiber and JioAirFiber.”

Besides, Jio Platforms also streamed the FIFA World Cup 2022 on JioCinema this quarter, which achieved a total viewership of 114 Mn across 64 matches.

The company added that the peak daily active users (DAU) of 34 Mn during the World Cup final set a record for the highest DAU across OTTs in India in 2022.

Further, according to data by data.ai, formerly known as App Annie, JioCinema had the highest weekly downloads peak of any OTT app in the world in November 2022, during the start of the FIFA World Cup 2022.

Meanwhile, RIL reported a marginal 0.6% YoY increase in its net profit during the December quarter at INR 17,806 Cr, excluding an exceptional item of INR 2,836 Cr. The Mukesh Ambani-led conglomerate’s gross revenue rose 14.8% to INR 2.41 Lakh Cr.