Reliance Industries Ltd reported a 39 per cent slump in its March quarter profit marking it the sharpest fall in oil prices since December 2008, as there is a lower fuel demand amid COVID-19 lockdown.
RIL posted a consolidated profit of 63.48 billion rupees ($845 million) in the three months which ended on March 31.
Less oil demand and dramatic fall in global oil prices due to the coronavirus pandemic has forced Royal Dutch Shell Plc to cut its dividend for the first time since World War Two.
In the last decade, Mukesh Ambani expanded his business to large telecoms and retail operations but the energy division still dominates other divisions for the overall revenue.
Refiners like Reliance buy and store crude oil for weeks, before processing it into fuel and petroleum products. An inventory loss is booked when oil prices drop by the time crude is processed into refined fuels. And in March the company faced an inventory loss of about 42.45 billion rupees ($565 million).
However, the telecom business Jio grew exponentially. Thus increasing the collection in revenue. Jio’s subscriber base at the end of March stood at 387.5 million.
RIL also runs 10,000 retailing stores and they report a modest 4% rise in revenue.
But overall Reliance’s consolidated revenue fell from 2.3% to 1.39 trillion rupees due to high volatility in the global and domestic market.