Reliance Consumer Products (RCPL), the FMCG arm of Reliance Industries, reported a significant increase in gross revenue to ₹8,600 crore for the quarter ending June, although profit figures were not disclosed. The company's retail segment saw a 7.4% rise in gross revenue to ₹90,408 crore, with underlying growth in grocery, fashion, and consumer electronics, despite pressure on operating margins.
The Independence brand contributed ₹3,200 crore in sales from daily essentials, while beverages, led by Campa, added ₹2,900 crore. However, rising e-commerce sales and investments in digital infrastructure have kept operating margins under pressure for the third consecutive quarter.
Isha M. Ambani, Executive Director of Reliance Retail, highlighted the company's resilient performance across key consumption baskets and emphasized the transformative power of their digital platforms. The company opened 252 new stores, expanding its network to 20,169 stores across 78.4 million sq ft.
“Our continued investment in digital commerce underscores the transformative power of our digital platforms.”
Isha M. Ambani, Executive Director, Reliance Retail
Dinesh Taluja, CFO of Reliance Retail, noted that retail margins are expected to remain under pressure as the company focuses on expanding its e-commerce business, particularly quick commerce. He stated that the company aims to double its operating EBITDA over the next three years through growth and improved economics.
Reliance Retail's EBITDA margin remained steady at 7.9%, down from 8.7% in the same quarter last year. The company is prioritizing quality over volume in its e-commerce ventures, with plans to adjust strategies if markets underperform.
“We are building the foundation of our e-commerce business and are focused on quality, not just volumes. As the business matures, returns on capital, and EBITDA will improve.”
Dinesh Taluja, CFO, Reliance Retail
Background
Reliance Retail has been aggressively expanding its presence in the Indian market, focusing on digital commerce and quick commerce as key growth areas. The company's strategic investments in digital infrastructure aim to enhance its competitive edge in the rapidly evolving retail landscape.
As Reliance Retail continues to invest in digital commerce, the focus will be on improving returns on capital and EBITDA as the business matures. The company's strategic expansion in e-commerce is expected to shape its future growth trajectory.
