Reliance Q1 Results: Did the Asian Paints sale really drive all the profits?

Reliance Industries kicked off FY 26 with a performance that turned heads across India’s corporate landscape. Clocking a consolidated net profit of ₹30,783 crore, a 76.5% year-on-year jump, Reliance Q1 results delivered a quarter that combined headline-grabbing gains with steady growth in core operations. It’s true that an exceptional, one-time boost came from selling a 4.9% stake in Asian Paints, adding ₹8,924 crore to the bottom line. But even stripping that out, Reliance’s underlying businesses showed impressive strength, with core profit and EBITDA each rising over 25%.

The company’s overall financial performance for Q1 FY26

Metric	Q1 FY26	Q1 FY25	YoY Change
Revenue	₹2,73,252 crore	₹2,57,823 crore	+5.9%
EBITDA	₹58,024 crore	₹42,748 crore	+35.7%
Net Profit	₹30,783 crore	₹17,445 crore	+76.5%

At the heart of this momentum lies the group’s diversified reach. Each business segment contributed to the upswing, offering distinct growth drivers and resilience in a volatile environment.

Reliance’s segmental performance

Business Segment	Revenue (₹ Cr)	YoY Growth	EBITDA (₹ Cr)	YoY Growth
Oil-to-Chemicals	1,54,804	-1.4%	14,511	+10.8%
Oil and Gas	6,103	-1.2%	4,996	-4.1%
Retail	84,172	+11.3%	6,381	+12.5%
Digital Services	41,949	+18.2%	18,312	+22.5%
Others (incl. Green)	18,470	+52.9%	2,589	+29.3%

Oil and Gas is focused on upstream resource extraction, while Oil-to-Chemicals represents downstream value addition through refining and chemical processing. Oil-to-chemicals (O2C) remains Reliance’s revenue anchor, accounting for more than half the company’s income. The division saw overall volumes dip by 1.5% compared to last year, a reminder that core energy markets remain unpredictable. Yet, thanks to strong fuel margins and operational discipline, O2C still pushed EBITDA up by nearly 11%. There was strong demand for petrol and diesel, which jumped 38.6% and 34.2% respectively, highlighting both persistent energy needs and Reliance’s nimble market positioning.

Retail, meanwhile, continues to expand its footprint at a pace. The segment posted 11.3% revenue growth, while EBITDA increased by a striking 12.5%, outpacing even the topline. Reliance Consumer Products Ltd. (RCPL) doubled its revenue in just one quarter, adding fuel to speculation that a future public listing or major partnership could be in the works. The company added 388 new stores, pushing its network to nearly 20,000 locations. In a sign of changing consumer habits, Reliance’s quick commerce operation saw order volumes explode 175%, driven not just by metropolitan shoppers but by rapid growth in Tier 2 and 3 cities as well.

On the digital frontier, Jio maintained its lead in connectivity. The company added about 10 million fresh subscribers, taking its 5G user base over the 210 million mark, currently the world’s largest for a standalone 5G network. JioAirFiber continues to add customers, reaching 7.4 million households with fixed broadband. The average revenue per user climbed modestly to ₹209, reflecting growing consumer appetite for digital entertainment, gaming, cloud, and productivity services. JioCinema, Reliance’s OTT play, notched up 892 million views for the IPL 2025 final alone, boasting over 287 million paid users. While these numbers are impressive, sustaining this pace amid fierce competition from global streaming platforms will be a continuing challenge.

Green energy remains a relatively small part of Reliance’s current business, but the company has made it clear that this area is a strategic focus going forward. With five integrated giga-factories under development in solar, battery, fuel cells, power electronics, and electrolysers, all on track for roll-out within 4-6 quarters, the groundwork for scaling up is being laid now. Likewise, 55 compressed biogas plants are expected online by year-end, a step intended both to cut energy costs and push the company toward a more sustainable carbon footprint.

Reliance’s financial discipline was also evident this quarter. Net debt currently stands at ₹1,17,581 crore, but a healthy Net Debt/EBITDA ratio of 0.59x suggests no immediate cause for concern. Of the ₹29,875 crore invested as capital expenditure this quarter, the bulk went to retail, digital, and green initiatives, funded mainly from internal accruals and carbon-linked financial instruments rather than additional borrowings.

In summary, Reliance’s Q1 results showcase both the advantages and challenges of running an enormous, diversified enterprise. The one-time gain from Asian Paints certainly inflated net profit, yet the company’s operating performance remains strong even without it. Reliance faces headwinds, softness in O2C volumes, rising competition in digital entertainment, and the task of scaling new green ventures. But with ongoing investment, a disciplined balance sheet, and a willingness to bet big on the future, Reliance is managing to both weather short-term volatility and set its own pace for longer-term transformation across India’s industries.

Disclaimer: This content is for educational purposes only; please conduct your own research and consult with a qualified investment advisor before making any investment decisions.

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