Is Reliance Building the Future? Q4 Results Deep Dive
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In today’s edition of The Daily Brief:
What do Reliance’s Q4 results tell us?
India wants to make its own potassium
What do Reliance’s Q4 results tell us?
Reliance Industries just announced its results for the March quarter of FY 2025. And given its heft as one of India's largest industrial conglomerates — which sells everything from petroleum, to dresses, to sim cards — we had to take a look at what’s happening.
This isn’t just so we understand Reliance’s own business, by the way. The company’s size and presence means that any story about the fate of its business is really a story about India’s economy, while any change in its business has ripple effects across the entire Indian economy. Its results are a window into what’s happening in the country as a whole.
So what’s happening?
In the fourth quarter of FY 2025, Reliance’s overall business revenue grew to 8.8% year-on-year and 7.7% QoQ. Its ‘EBITDA’, a measure of how much profit a company makes from its core operations, grew 3.6% year-on-year and 1.5% QoQ. Meanwhile, it’s net profit — that is, its actual bottom line — rose 6.4% year-on-year and 3.1% QoQ.
So, all in all, it’s a solid showing by the company.
To better understand what’s happening, though, let’s dive into each of their business segments. We’ll go through them in the order of their contribution to the company’s revenue, starting with the biggest.
Oil-to-Chemicals (O2C)
At the heart of Reliance’s business is the O2C segment. In this segment, Reliance refines crude oil into fuels like petrol and diesel — and also makes plastics, polymers and other chemicals that go into clothes, packaging, and more. This is where the company generates all the cash that lets it chase all its other projects. In fact, this single business line contributes roughly half of the company's total revenue.
In Q4 FY25, Reliance’s O2C revenue grew 15.4% year-on-year. But its EBITDA actually fell by 10%. Why? Because while the company’s business ran as usual, its operating margin — the difference between what they pay for crude and what they earn from selling fuel and chemicals — has collapsed over the last financial year.
Why? The main culprit was China.
China just opened a flood of new refining and chemical production capacity last year, and dumped cheap supply into the market. With too much supply, and not enough demand, prices crashed.
Reliance wasn’t caught entirely off-guard, though. It reacted smartly to the mess. In fact, it noted that compared to other global refining companies, Reliance did a much better job of surviving China’s sudden flood of exports. How did they manage this? They shifted focus towards selling more fuels within India, where margins were better. Domestic volumes rose sharply — gasoline sales grew by 42%, gasoil (diesel) by 33%, and aviation turbine fuel (ATF) by 62%.
As V. Srikanth, its CFO, said, Reliance deliberately focused on selling more in India to shield themselves from the global volatility caused by Chinese dumping:
"Domestic push has been a big standout... our performance compared to standalone petrochemical manufacturers and even integrated players globally is standout”
One reason they could make this shift was Reliance’s Jio-BP petrol pump business. Its presence is still small — at least compared to giants like Indian Oil — but its growing fast. Reliance said that "higher sales through Jio-bp with attractive retail margins" helped soften the blow.
They're not sitting still either — in fact, they plan to climb the value ladder. Reliance announced it would invest ₹75,000 crore over the next five years to expand its specialty chemicals and textile materials business, aiming to move into higher-margin, less commodity-like products.
Reliance Retail: Back with a bang
REliance’s retail arm had a very strong quarter. After a slow first half to FY 2024 — owing to monsoon season and the election-related spending slowdown, the second half saw it bounce back strongly, helped along massively by festivals, weddings, and even events like the Mahakumbh.
The company’s management said that "Mahakumbh and festive demand" played a major role in driving a pickup in retail sales. As people following the markets, this strikes us as fascinating. The fact that a single religious gathering could move the needle for a giant like Reliance says a lot about how Indian society, and how closely its consumption can be tied to specific cultural events.
Revenue from retail grew 15.7% year-on-year in Q4, although it declined slightly since the December quarter — falling by 1.9% QoQ. Its EBITDA was up 14.4% year-on-year, although that, too, declined slightly QoQ.
Reliance says that its quick-commerce vertical, powered by JioMart, is gathering serious steam. Their average daily orders grew by 62% YoY. In fact, during the March quarter alone, their under-30-minute delivery orders grew 2.4x quarter-on-quarter. What’s interesting is that they aren’t trying to copy the Zepto playbook of setting up a network of dark stores. Instead, they’re using their existing 2,100+ brick-and-mortar store network.
Can this be a challenger to the dark store model? Only time can tell, of course, but from what the Reliance management says, their big advantage is that they’re more profitable than they’re digital-first peers.
Here’s what the management said:
The big advantage that we have in this segment is compared to other people who have to set up dedicated store infrastructure. For us, we are only leveraging the infrastructure that we already have. My fixed cost is already being taken care of by my store sales. This is all incremental sales and it is only incremental cost that I have to incur to deliver these orders. So we are doing this model in a profitable manner with a very strong unit economics.
Reliance also expanded its consumer brands business rapidly. Products like Campa Cola and Independence groceries earned a staggering ₹11,450 crore revenue in just their second year. They also launched Shein — the fast-fashion giant — back into India via Ajio. In doing so, it brought over 12,000 clothing options to India, making it one of the widest fashion selections available.
Jio Platforms: The beast keeps growing
Jio is now the world’s largest data company outside China. And yet, its growth has somehow not slowed down even now. Its revenue from this segment grew 17.8% YoY, and 2.8% QoQ. Its EBITDA was up 18.5% year-on-year and 2.6% QoQ.
They added 6.1 million customers in Q4 alone, bringing their total subscriber base to a massive 488 million.
All these customers are paying it more as well. The segment’s ‘average revenue per user’ (ARPU) rose to ₹206.2, up 13.5% from last year, helped along by price hikes.
Jio’s achievement, by the way, isn’t just financial — it’s also making major technological leaps. Jio has transitioned 191 million users to 5G already. Remarkably, 45% of all Jio data traffic now happens over 5G. One jaw-dropping achievement: Jio successfully handled the world's densest mobile event at the Mahakumbh 2025 — where 660 million devotees reportedly gathered over 45 days.
As Anshuman Thakur, Head of Strategy, put it:
"Nobody anywhere in the globe had ever seen something like this."
And also:
"There were jammers, limited access zones, drones causing interference — and yet our network gave 200 Mbps+ speeds and processed 2.2 million GB of data traffic."
This is being treated as a case study globally. No telecom company anywhere had ever managed something at that scale.
Separately, Jio has also opened a new business-to-business vertical. It launched private 5G networks for industries (like at their own Jamnagar refinery), offering dedicated, secure 5G slices for things like robotic automation and video surveillance.
Oil & Gas Exploration: Mixed bag
Reliance’s oil and gas business is small, at least compared to its retail or telecom giants. And this time around, its performance was a bit slow as well. Its revenue was flat, while EBITDA fell about 9% year-on-year.
The main reason? A natural decline in production at their biggest gas field, KG-D6.
During the quarter, the segment even saw a major disruption, as it temporarily shut parts of the field for planned maintenance. But after maintenance, production quickly bounced roughly back to normal.
There’s an interesting new development, though, with their coal bed methane (CBM) gas fields. Traditionally, extracting gas from coal seams is both difficult and low-yielding. But Reliance tried something new: multi-lateral drilling. Basically, they started drilling sideways instead of straight down. And it worked. New wells are now producing 3x more gas than older wells
As the management said:
"It is the first time horizontal multi-lateral wells have been done in India and successfully deployed."
This is a big deal because India’s demand for natural gas is rising steadily — up 4% last year — even as supply is shrinking.
New Energy: A new Reliance empire taking shape?
If you want to know what Reliance is headed over the next decade, keep your eyes on its ‘new energy’ vertical — which is quietly picking up steam. In the past year, they’ve quietly moved from just “announcing” projects to actually building things on the ground.
Here’s what’s happening:
Solar manufacturing: Reliance built its first 1 GW solar panel plant, and has already started production. These aren’t basic panels either — they’re using cutting-edge technology called Heterojunction Technology (HJT), which makes panels more efficient. This is just a start: the setup could quickly expand to 10 GW by 2026, and even 20 GW later.
Battery gigafactory: Reliance is constructing a massive battery plant to support a green transition. They hope to eventually produce 30 GWh worth of batteries each year. Batteries are crucial to store solar and wind energy — without them, renewable power can’t be reliable. And as we transition to renewables, this new plant will give Reliance a new foothold in that future.
Green hydrogen: Reliance has bought 2,000 acres of land in Gujarat to build a full green hydrogen ecosystem. Green hydrogen is seen as the clean fuel of the future, and Reliance is trying to be one of the first big players globally.
Bio-Energy: Reliance is already running 10 biogas plants. They plan to expand this to 55 by next year. These plants basically take agricultural waste and convert it into cleaner fuel. Reliance is even growing special crops on barren land to feed these plants — an experiment that could have massive long-term impact if it works.
Taken together, Reliance seems to be working on a plan to become a future global leader in clean energy — in the same way that it’s currently a powerhouse in the fossil fuel economy. This is a holistic push — it isn’t just selling solar panels or hydrogen here and there, but building a full clean-energy supply chain from start to finish.
With some luck, it could dominate India’s clean energy future some day — remaining one of India’s largest industrial conglomerates, even as the heart of its business changes.
India wants to make its own potassium
Potassium is an underappreciated miracle of nature.
It’s made of tiny molecules that dissolve quickly in water, and then zip around easily. They’re small enough to get through most barriers and membranes in the cells of living things. And chemically, they’re in a Goldilocks zone of reactivity: they pull at electrons strongly, but aren’t so reactive that they stick to everything and become hard to work with.
To living things, this makes potassium the perfect tool. It can be carried easily to wherever it’s needed, and its chemical properties make it relatively simple to use. Over the eons, living things have turned it into a basic building block of life. Plants, for instance, use potassium for everything from controlling the amount of water they get, to “switching on” their enzymes, to making sure a plant’s internal structure is robust and strong. A plant that’s well fed with potassium is one that produces sweeter fruits, crisper vegetables and more nutritious grain.
The problem is: plants find it incredibly hard to pull potassium out of the soil. It binds too strongly with clay to be absorbed easily. If you’re a farmer, and you want to give your plants enough potassium, you’ll need something extra: fertilisers.
Which brings us to India’s big problem. We practically import all of the potassium we need to feed India’s billion-and-a-half mouths (and half a dozen other industries, besides). This makes us terribly vulnerable to problems in the potassium supply chain.
India’s trying to find a way around this problem, though. We’re exploring how we can make our own potassium domestically. This could be a game-changer. But is it actually feasible? And what should one expect if things work out? Let’s dive in.
India’s potash vulnerabilities
You find “potash” — a generic word for potassium salts like potassium chloride — in the remnants of prehistoric seas. These landlocked seas dried up millions of years ago, and all their salt was deposited as crystals at the bottom. Today, those ancient seafloors are buried deep in the ground, under large beds of sedimentary rock. We dig all those salts up, isolate ones with potassium and package them as fertiliser.
This is an extremely important process. There’s literally no substitute for potassic fertilisers.
For all its importance, though, potassium extraction is heavily concentrated in small pockets of the world.
There are only a handful of countries in the world, like Canada, Russia or Belarus, that actually dig out potassium at an industrial scale and turn it into fertilisers.
The rest of the world — including the world’s biggest population centres, like China, United States and Indonesia — import those fertilisers. That’s also true of us, here in India. We’re currently the fourth largest potash importer in the world, with an annual import bill of around $1.5 billion a year.
This dependence can become a critical problem — something that has become extremely clear in the recent past.
Belarus, for instance, is the world’s third largest producer of potassium. It has, however, been hit with repeated rounds of sanctions over the last few years — first, for human rights abuses, and then, because of its involvement in the Russia-Ukraine war. This made it incredibly hard for Belarusian potassium miners to obtain finance, and transport their products. As that happened, potash prices briefly shot up all over the world.
Similarly, last year, when tensions between India and Canada flared up last year, our potash imports took a sudden hit. Within the space of a year, our potash imports from Canada fell by 13% — pushing us to turn to Russia instead.
Since 90% of our potash imports are used for farming, these pricing disruptions are a direct threat to our farming economy, and by extension, to our food security as a whole. That is to say, this isn’t just a matter of securing an industrial input, but a major strategic concern.
What we’re doing
For almost half a century, we’ve known of massive potassium deposits — 20,000 MT of it, in fact — in north-western Rajasthan. Some claim that this is one of the largest deposits in the entire world. Going by today’s requirements, the deposit is large enough to meet our potassium needs for the next 4,000 years. There are smaller deposits all over India — from Uttar Pradesh, to Gujarat, to Arunachal Pradesh — though these might be lower in quality.
Earlier this year, we also discovered a sizable deposit of high-quality potash, spread over 18 square kilometers, in nearby Punjab.
Until recently, we had been dragging our feet on actually commercialising all these reserves. While we had made initial potash discoveries in the 1970s and 80s, we didn’t proceed to actually extract any of it. Our reconnaissance was too preliminary to actually auction those sites, but procedural hurdles and red tape held us back from prospecting any further. Meanwhile, we continued importing the critical mineral, increasing our import bills, stretching our subsidies, and putting ourselves at the mercy of geopolitical volatility.
But recently, things have started changing.
In 2023, India declared potash a “critical mineral” — signalling that the government was going to make a strong push to improve its potash supply chain. It then made several attempts to auction potash mining sites in Rajasthan. There, however, it met a setback. The government had tried auctioning these blocks prematurely, without a proper sense of the deposits that were available. The auctions had to be annulled.
But we’re trying once again. On May 1st, two blocks in Rajasthan will go under the hammer once again. This time around, the government hopes that more liberal rules around who can bid might help it push the auction through. There’s at least some private interest, if reports are to be believed. For instance, Hindustan Zinc Limited, a company from the Vedanta group that once focused exclusively on zinc and silver, has recently expressed interest in bidding for a block and expanding into potash mining.
If these auctions are successful, it will be the first time that we shall extract the mineral ourselves.
What do we expect, going forward?
We don’t want to get your hopes up too high. Even if everything goes as per plan, this is a long-term project.
If the auction succeeds this time around, it’ll be a few years before that turns into domestic potash supply. First, the winning bidders will have to conduct environmental impact assessments, and obtain necessary licenses and permits. They’ll also have to carry on some further prospecting to get a better sense of where the mineral actually sits underground. It’s only after all of this that they’ll even begin pilot projects to test how they can actually extract that potash.
Production will only start at any respectable scale by the end of this decade, and significant production will be further still. As per the International Energy Agency, in fact, a mining project typically takes around 16 years from the point of discovery to kick into full gear. All the work going in now will only bear fruit many years down the line.
Sadly, we live in a world where Murphy’s law applies. Many things can derail our potash production dreams. Here are just a few:
So far, the private sector hasn’t responded too enthusiastically to our attempts to auction potash sites. It is, after all, a multi-billion dollar investment they’re considering — not a sum that businesses will part with on a whim. So far, all our attempts to auction potash sites have failed, because of all the deep uncertainties involved. If that happens again, we’ll have to rethink how to incentivise the private sector into taking up these projects.
A mining project can only succeed if it’s supported by enough infrastructure. You need rail or road links to ship out a mine’s produce, as well as a stable power supply to run these projects to capacity. Potash mining also takes a lot of water — which may be hard to arrange in Rajasthan. The government will have to put in money to set up all of this, for private players to consider the opportunity seriously. Without this infrastructure in place, though, it’s impossible to build viable mines.
Mines aren’t pretty to set up. It involves taking over large tracts of land, and can pollute the environment substantially. Unless there’s enough work that goes into getting the buy-in of local populations, such projects can run into immense opposition.
Moreover, the entire market opportunity in potash mining is based on the Indian government’s substantial fertiliser subsidies. If those disappear, the entire market opportunity can disappear, or at least shrink severely. Any company that attempts potash mining will have to be assured that our policies remain certain.
The eventual success of our potash mining ambitions will depend on how proactively we can address these challenges.
What’s the upside?
With that said, the success of these projects could be a big deal.
It’ll go a long way towards ensuring that India has an uninterrupted supply of fertilisers. The experience of the last few years has shown us that foreign suppliers can suddenly go offline, for reasons that are hard to predict and harder to control. Everything from trade barriers, to wars, to other supply chain disruptions can suddenly throw our entire agricultural backbone into disarray. Protecting ourselves from these disruptions is a strategic necessity for India.
Potassium isn’t something most of us think about. It’s invisible, tucked away in the cells of our crops and fruits. Our dependence on it, however, is profound. In trying to extract it from our own soil, India is taking a slow, complex, and difficult step toward safeguarding something much bigger: the security of our food, the stability of our farms, and the future of a billion and a half people.
This won’t happen overnight. But it’s a journey worth making.
Tidbits
TVS Motor Delivers Record Profit and Revenue Growth in FY25
Source: Business Line
TVS Motor Company reported its highest-ever standalone profit after tax of ₹2,711 crore for FY25, marking a 30 per cent increase over ₹2,083 crore recorded last year. Revenue from operations rose 14 per cent year-on-year to ₹36,251 crore, while operating EBITDA margins improved by 120 basis points to 12.3 per cent. Profit before tax stood at ₹3,629 crore, up 31 per cent from FY24. The company sold 47.44 lakh two- and three-wheelers during the year, a 13 per cent growth compared to 41.91 lakh units previously. Motorcycle sales rose 10 per cent to 21.95 lakh units, while scooter sales saw a 21 per cent jump to 19.04 lakh units. Electric vehicle sales grew by 44 per cent to 2.79 lakh units, crossing the half-a-million cumulative EV customers milestone
IndusInd Bank to Take $229.56 Million Hit on Derivatives Misstatement
Source: Reuters
IndusInd Bank, India's fifth-largest private lender by assets, announced it will take a $229.56 million hit for the financial year ended March 31, 2025, due to incorrect accounting treatment of currency derivatives over the past six years. The amount was finalised following internal and external reviews after the discrepancy was initially disclosed in April. The bank stated that responsibility has been fixed on the individuals involved, and senior management roles are being realigned. Internal derivative trades have been discontinued since April. IndusInd Bank is expected to release its full-year earnings before May 15, although a specific date has not yet been announced.
Axis Bank Plans $6.4 Billion Fundraising Through Debt and Equity
Source: Bloomberg
Axis Bank has announced plans to raise ₹55,000 crore ($6.4 billion) through a combination of debt and equity instruments. The bank will raise ₹20,000 crore ($2.3 billion) via equity by selling local shares or depository receipts through institutional placement or preferential allotment. Additionally, ₹35,000 crore ($4.1 billion) will be mobilized through local rupee bonds, foreign currency bonds, Additional Tier-1 bonds, and infrastructure bonds. In the March quarter, Axis Bank reported a profit of ₹7,120 crore, marginally down by 0.2% year-on-year but above the Bloomberg analyst estimate of ₹6,601 crore. The fundraising comes at a time when the broader Indian banking sector remains resilient and investor sentiment is positive.
- This edition of the newsletter was written by Krishna and Pranav.
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