Reliance Retail posts best-ever performance in Q1 FY2223, more to come

With the onset of schools, colleges, offices and travel in full swing, its quite common to see shoppers back in malls, shopping centres and high streets. Reliance Retail has well captured this opportunity. While its grocery business doubled revenues over the same quarter last year, its fashion business grew 3x. The Jewellery division grew 3x, Consumer Electronics division grew 2x along with JioMart, the digital arm. The retail behemoth operates over 15,866 stores as on 30 Jun. ‘22, according to a press release by the company while adding 792 stores between Apr – Jun. ‘22.

Reliance Retail’s Gross Revenue for the first quarter of FY 2223 (total amount collected from customers via point of sales) was Rs. 58, 554 Cr. The revenue for the same period in FY 2122 was 38, 547, signalling a growth of 51.9%. However, the growth over the immediate past quarter – Jan – Mar. ‘22 was 1%. Earnings before Interest, Depriciation and Taxes stood at Rs. 3,897 – a growth of 180.4% over the same period last year. The key reason for this was a significant change on the sales contribution. In 2021, the sales was led by essentials such as grocery where the operating margins are low single digits while in this year, the sales was led by fashion and apparel which have much higher margins.

Reliance said that it recorded over 175 mn footfalls for the year and estimates they are 19% over the pre-Covid period – 2019, that is. Subsequently, the company recorded 220 mn transactions at its offline stores as well as on digital platforms such as JioMart, Ajio, etc. Cash profit for the quarter grew 105.2% over last year to Rs. 2,873 Crores. The company operates retail area covering 45.5 mn sq ft across India. The company added 17,000 jobs, taking the total payroll to ~3,79,000 employees, the company said creating a social and financial impact.

Though Malls and offline shops are conducting business in full swing, AJIO witnessed a sharp increase in its business. The company said the “stickiness” to the app was witnessed by 2x spending of customers who had enrolled less than a year back, while compared with those who had done their first transactions in 90 days. Repeat customers is the bane of e-commerce and the platform seems to be getting better at this.