MANAGEMENT DISCUSSION AND ANALYSIS
Financial Performance and Review
Operating Environment
Global economic growth remained healthy at 3.3% in CY24 consistent with the prior year. Global inflation eased to 5.7% in CY24 from 6.7% in CY23, supported by the stabilisation of supply chains post-COVID and a moderation in commodity prices. This enabled major central banks to ease monetary policy, lowering benchmark rates by 50 to 100 bps in CY24.
However, geopolitical tension and policy uncertainties, including trade tariffs, led to volatility in global markets, adversely impacting energy demand, resulting in softer prices and narrower margins. Transportation fuel margins moderated from elevated levels, and downstream chemicals margins came under significant pressure due to incremental supply additions, particularly from China.
Despite global headwinds, the Indian economy was remarkably resilient. While growth moderated to 6.5% in FY 2024-25 from 9.2% in FY 2023-24, India retained its position as the fastest growing major economy in the world.
Domestic consumption witnessed mixed trends with rural demand strengthening, and urban consumption moderating. Macro-prudential regulatory tightening of credit in FY 2023-24 led to moderation in personal credit growth to 16% in FY 2024-25, from 27% in FY 2023-24. Consumption demand remained relatively soft during the first half with general elections and peak monsoon. The festive season and Mahakumbh revived domestic markets in the second half. However, pockets of urban and rural demand are yet to fully recover.
External balances in India saw continued strength in current account with resilient services surplus (current account deficit <1% of GDP). Net services exports clocked another 14% Y-o-Y growth, driven by continued momentum in digital services and Global Capability Centres GCC). In the second half, capital inflows slowed as FPIs turned net sellers, leading to tighter liquidity. In response, the RBI cut the CRR by 50 bps in December, and subsequently reduced the policy repo rate by a cumulative 100 bps to 5.5% by June 2025. India remains well positioned for sustained high growth on the back of favourable demographics and a large domestic market.
Performance Overview
Reliance Industries Limited delivered a resilient performance for FY 2024-25, emphasising the strength of its India-focused, diverse business portfolio. Amidst prolonged global volatility, the Company delivered balanced and consistent growth across its businesses.
- Consolidated revenue increased by 7.1% to `10,71,174 crore (US$ 125.3 billion), compared to `10,00,122 crore in FY 2023-24
- EBITDA grew by 2.9% to `1,83,422 crore (US$ 21.5 billion) from `1,78,290 crore in the previous year, with consumer businesses contributing over 50% of consolidated EBITDA
- PAT rose 2.9% year-on-year to `81,309 crore (US$ 9.5 billion)
Segment Performance:
- Digital Services EBITDA grew 14.7% supported by widespread adoption of 5G and broadband across mobility, home, and enterprise segments. Tariff revision introduced during the year was well absorbed, with no adverse impact on data consumption trends.
- Retail EBITDA grew 8.6%, benefitting from productivity gains through network optimisation and improved operating metrics
- Oil and Gas EBITDA increased by 4.9% supported by a marginal increase in production from the KG D6 block
- Oil to Chemicals (O2C) EBITDA declined by 11.9%, impacted by weaker fuel cracks and lower petrochemical margins. The performance was supported by stronger domestic demand and feedstock flexibility. The segment witness increased fuel retail sales through Jio-bp, aided by a favourable margin environment.
- Consolidated cash profit increased to `1,46,917 crore, compared to `1,41,969 crore in FY 2023-24.
Consolidated Net Debt
RIL’s gross debt as on 31st Mar’25 stood at `3,47,530 crore (US$ 40.7 billion) Net debt stood at `1,17,083 crore (US$ 13.7 billion). Robust internal cash-flow generation supported investments in growth opportunities across business, while maintaining a conservative balance sheet and investment grade credit ratings.
Capex
Capital expenditure for the financial year stood at `1,31,107 crore
(US$ 15.3 billion),
adequately covered by cash profits. FY 2023-24 capex was at `
1,31,769 crore.
FY 2024-25
investments were largely directed towards new O2C projects, Retail store expansion,
augmenting Digital Services infrastructure and building manufacturing assets in New Energy.
Standalone
Standalone RIL revenue was at `5,57,163 crore (US$ 65.2 billion), lower by 3.1% as compared to `5,74,956 crore in FY 2023-24. EBITDA for the standalone entity fell 14.2% to `74,163 crore (US$ 8.7 billion) from `86,393 crore for the year ago period. The O2C segment profitability was impacted by unfavourable global demand-supply balance, which was partially offset by improved upstream performance with higher volumes of gas and condensate. Standalone Profit After Tax was at `35,262 crore (US$ 4.1 billion), down 16.1% vis-a-vis `42,042 crore last year.
Movement in Key Financial Ratios
The net capital turnover ratio improved from 25.43 in FY 2023-24 to 47.92 in FY 2024-25, due to reduction in net working capital.
The operating margin ratio declined to 7.2% in FY 2024-25 as against 9.8% in previous year primarily due to weaker transportation fuels and downstream chemical margins.
The return on net worth* fell to 8.2% in FY 2024-25 as against 10.3% in previous year due to decline in O2C earnings.
*Adjusted for CWIP and revaluationLiquidity and Capital Resources
Macro Environment
FY 2024–25 witnessed high volatility
in financial markets. In India, first
half of the financial year saw global
outperformance of Indian assets
driven by healthy growth momentum,
continued improvement in fiscal
health, which led to prospect of rating
upgrade, and bond index inclusion flows.
Softening global yield environment
helped India benchmark 10y G-sec yield
to ease decisively below 7%, while rupee
remained stable.
However, second half of the financial year saw large outflows from foreign portfolio investors, softening of growth momentum in India and resurgence of China as an investment destination. This had a depreciative effect on INR and tightened banking system liquidity. As a result, from December 2024 onwards, RBI began easing financial conditions through a mix of CRR cut, Repo rate cuts and injection of rupee liquidity.
Fund Raising
Despite a volatile environment, RIL
successfully executed a multi-currency,
multi-instrument financing strategy, achieving an optimal capital structure at
competitive costs. The proceeds were
primarily utilised to fund green capital
expenditures and to refinance upcoming
debt maturities.
Offshore Facilities
Syndicated Term Loan
Facilities (~$3 billion
equivalent)
The Company secured these facilities to
refinance maturing debt obligations.
ECA Supported Facilities
(~$1 billion equivalent)
RIL tied up ~$1 billion equivalent green
SACE Push facilities supported by Italian
Export Credit Agency (SACE) to finance
capital expenditure towards eligible
green projects. This is the first such fully
green-labelled facility for the Company.
Liquidity Management
RIL maintains a robust liquidity management framework to ensure financial flexibility and resilience in all market conditions. The Company leveraged a diverse funding strategy and efficiently managed working capital. RIL’s surplus funds were deployed in stable yield instruments, insulated from unfavourable market movements to ensure immediate access to liquidity.
Credit Rating
RIL continues to be rated two notches above sovereign by S&P and one notch above sovereign by Moody’s.
Instrument | Rating Agency | Ratings | Remarks |
---|---|---|---|
International Debt | S&P | BBB+ | Two notches above India’s sovereign rating |
International Debt | Moody’s | Baa2 | One notch above India’s sovereign rating |
Long-Term Debt | CRISIL | AAA (Stable) | Highest rating by CRISIL |
Long-Term Debt | CARE | AAA (Stable) | Highest rating by CARE |
Long-Term Debt | ICRA | AAA (Stable) | Highest rating by ICRA |
Long-Term Debt | India Ratings | AAA (Stable) | Highest rating by India Ratings |
Way Forward
RIL remains committed to maintaining a strong liquidity position and a robust capital structure to enable organic growth and strategic investments. The Company generates strong cash flows, enabling it to fund strategic initiatives, service debt, and deliver long-term value to shareholders. RIL will continue to prioritise prudent capital allocation within a robust risk management framework to achieve its strategic goals.