Reliance Q2 Profit Rises 17% to Rs 9,516 Crore – Detail about Telecom Industry

October 22, 2018

On Wednesday, Reliance Industries reported 17.35 per cent year-on-year rise in net profit at Rs 9,516 crore, below an Rs 9,629 crore estimate analysts.

This was the highest quarterly profit in RIL’s history. The Mukesh Ambani-owned firm had reported Rs 8,109 crore net for the year-ago quarter.

The company announced strategic partnerships with Hathway Cable and Den Networks. It was reported earlier this week that RIL was likely to own more than 25 per cent each in the two companies, giving it the ability to control developments and get a seat on the board.

Consolidated revenues rose 54.5 per cent YoY to Rs 1,56,291 crore in September quarter. The top line jumped due to higher price realizations of petrochemical and refinery products led by 44.5 per cent increase in Brent crude price. According to the company the increased revenue also reflected in higher volumes with the commissioning and ramp-up of new petrochemical facilities.

Gross refining margin for the quarter came in at $9.50 per barrel against $12 per barrel in the same quarter last year. Analysts were largely expecting the company to report flat GRM on a sequential basis at $10.6-10.9 a barrel.

One of the most emergent industries is telecommunication industry that has evolved very swiftly in last decade. At present, India is the world’s second largest telecommunication market and it is still growing. Mobile economy in India is increasing very fast and will add significantly to India’s GDP. Indian telecommunication market is a excellent opportunity for network providers from native and exogenous Players. Both Indian network providers’ international providers receive considerable market share in the Indian mobile industry. Recently Reliance Jio has gave a big jolt to Indian telecom industry, schemes like free internet, free calling, 4g network provide a serious threat to others. Reliance Jio emerge a new choice and other service providers face a new kind of challenge and find difficult to cope up with new circumstances. This research paper discusses the features of the jio and also through some light on the competitive edge over other service providers

Throughout the world telecom sector is one of the prevalent sectors. Study stats that India would be a speedily escalating hub for internet users, with market expected to be $9 billion by 2020. Indian telecom sector is becoming backbone for fast growing Indian economic of this decade. Jio came up in Indian telecom sector with a idea to make huge revenue by providing quality service at a very cheaper rate. It came with advantage of first biggest 4G network coverage across all 22 telecom circles in India According to Paulasset, 2016 reliance jio is working according to Indian market; it gives best quality services at much less price. Reliance Jio also giving challenge to more than 30 businesses because it also enters in other service sector related to telecom sector.

It has been few months since the chairman of Reliance Industries Ltd, Mukesh Ambani announced the launch of the company’s 4G enabled telecom network Jio. There is hardly any time to make any serious impact in a telecom market, especially on the market like India, which is extremely competitive. However, Jio seems to have made a dent, with even competitors like Airtel. Jio seems to claim that it will stay for long. Let us see how Jio has impacted the Indian telecom market;

  • A month after the launch of Jio, Reliance Industries Ltd claimed that the network had 16 million subscribers. This is an all time record. Few analysts believe, that by the end of the preview offer, the network, which has been adding 1-1.2 million subscribers a day, will likely have 25 million 4G customers. This compares with Airtel, which has 35 million 3G and 4G users, and Vodafone and Idea, which together have 25 million. According to some experts, they have estimated that in next three years Jio could have 100 million subscribers. If this turns true, then there will be more than 2.5 times the number of subscribers Jio will require to breakeven. Brokerage Religare had stated that to breakeven at the EBITDA level, the network must have at least 40 million subscribers.
  • Demand for Voice over LTE phones in the country had surged since Jio was launched in September. VoLTE technology allows voice calls to be transmitted as data, while a 4G network is being used. According to reports, 80% of LTE compatible Smartphone shipped during the July-September quarter were VoLTE enabled, as compared to 63% in Q2 and 30% in Q1. By the first half of 2017, 90% of all LTE enabled phones to be shipped into India will use VoLTE technology. Samsung, Lyf, Lenovo and Xiaomi are among the leading brands in the VoLTE category, which effectively means that VoLTE will become the default basic minimum Smartphone technology in the country.
  • The chairman of Reliance Industries Ltd, Mukesh Ambani said at its launch that Jio will be offering the lowest data tariffs in the country, and it will also allow users to make voice calls for free not just on its network but also from Jio to other networks. The company also gave free trial for four months to their customers. On the other hand, other networks like Airtel also announced cheap data plans to compete with Jio. Taking a closer look, you will notice that Jio’s offering was certainly the cheapest, but it was not cheaper by much. Even though, it had shaken the data market. Alike Jio, no other operator had revolutionized the data market in the past.




About nehanchal

I am Nehanchal. 3 years ago, I started my career as content writer at Money classic Research. I am fascinated with this job and I feel habit of reading and writing enhances your skills. I love to write technical and health blogs. However, I am engineer turned writer and pursued graduation at Rajiv Gandhi Prodyogiki Vishwavidhyalaya.
By: nehanchal

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