Reliance Retail Q2 Revenue Hits Rs 91,716 Crore; Profits Dip Amid Strategic Shifts
Reliance Retail reports a 6.4% revenue jump to Rs 91,716 crore in Q2 FY27, though profits dipped to Rs 2,619 crore amid strategic investments.
Reliance Retail Ventures Limited (RRVL) has announced its financial results for the second quarter of FY27, showcasing a complex picture of growth and strategic adjustment. While the retail giant saw its gross revenue climb to Rs 91,716 crore, marking a 6.4 per cent year-on-year increase, the bottom line took a hit with profit after tax sliding to Rs 2,619 crore.
This profit figure represents a 24.5 per cent decline compared to the Rs 3,469 crore reported in the same quarter of the previous year. The revenue growth figures have been adjusted to account for the demerger of the Consumer Brands business.
Revenue Growth vs. Margin Pressure
Looking closer at the operational numbers, revenue from operations rose by 5.8 per cent to reach Rs 80,220 crore, up from Rs 75,836 crore in the prior year's corresponding quarter. However, the company faced pressure on its margins.
Earnings before interest, tax, depreciation, and amortisation (EBITDA), before a one-time impairment charge, fell by 8.6 per cent to Rs 6,228 crore. The EBITDA margin contracted by 120 basis points, dropping from 9 per cent to 7.8 per cent.
The company attributed this margin squeeze to several key factors:
- Digital Investments: Planned spending to bolster digital commerce capabilities.
- Inflation: Absorbing input-cost inflation to protect customers from price hikes.
- Calendar Shift: The shift of major festive celebrations into the third quarter.
Additionally, a one-time impairment charge of Rs 108 crore brought the final EBITDA down to Rs 6,120 crore. The company also saw a significant spike in finance costs, which rose 53.9 per cent to Rs 905 crore due to higher interest rates and increased borrowing.
Store Network and Customer Engagement
Despite the festive shift, Reliance Retail managed to grow its customer transactions by 7 per cent year-on-year. The company continues to aggressively refine its physical footprint, opening 303 new stores during the quarter.
However, in a move to optimize efficiency, the company closed several unproductive outlets, resulting in a net decline of 222 stores. As of September 30, the retail behemoth operates 19,947 stores spanning 77.5 million square feet of retail space.
Segment Performance: Digital and Electronics Lead
The digital arm of the business showed impressive momentum, particularly through JioMart, which witnessed a massive 42 per cent revenue growth. This was fueled by higher average order values and a 24 per cent increase in units per order, leveraging a network of over 5,000 stores across 1,000+ cities.
Key Segment Highlights:
- Grocery: Like-for-like (LFL) sales grew by 3 per cent, while B2B revenue jumped 10 per cent due to higher transaction volumes.
- Consumer Electronics: LFL growth stood at 8 per cent, while the distribution business surged 20 per cent, driven largely by laptop and mobile sales.
- Fashion & Lifestyle: LFL sales rose 3 per cent. Notably, the contribution of Reliance Retail's own private brands increased by 710 basis points.
Luxury and Global Partnerships
The company is doubling down on the premium segment. AJIO’s catalogue expanded by 23 per cent to 3.3 million options, and AJIO Luxe added 22 new brands, bringing its total portfolio to 1,040. The premium and luxury portfolio has now crossed the milestone of 1,000 exclusive brand stores.
Reliance Retail also expanded its global offerings by launching Fabletics and establishing an exclusive partnership with SKIMS.
"Our customers’ trust and continued engagement across our stores and digital platforms remain central to our growth," said Isha M Ambani, Executive Director of Reliance Retail Ventures Limited. "We are building a future-ready retail business by combining our extensive physical network with digital convenience, technology, and a deep understanding of Indian consumers."