Newsletter
When Reliance Industries first disrupted Indian telecom in 2016 with Jio, it wasn’t just launching a telco, it was laying the foundation for a full-blown consumer-tech empire. Since then, the group has layered on everything from retail and media to green energy and AI platforms. Today, it’s a modern-day conglomerate with a balance sheet that funds oil barrels, cricket matches, and cloud PCs, all at once.
The last few quarters have been about scaling these businesses, quietly building moats in each segment.
Q1 FY26 is not a breakout quarter rather it’s a demonstration of breadth. Whether its Jio adding 10 million users, Retail pushing 175% growth in digital grocery orders, or New Energy nearing commissioning, Reliance isn’t just diversifying , it’s operationalising. And this quarter tells us just how well those bets are shaping up.
How this quarter stacks up
After a muted March quarter, June brought solid movement across topline, subscriber growth, and margins, aided by festive demand in media, subscriber additions in digital, and a gain from the sale of Asian Paints stake.
Let’s start with what moved the needle.
Digital services clocked a 23% jump in EBITDA, thanks to more subscribers, higher data use, and growing 5G adoption. Jio now serves 498 million users, of which 210 million are on 5G.
ARPU (Average Revenue Per User) stood at ₹209, supported by rising consumption and bundled offerings like cloud gaming (JioGames), AI Cloud storage, and the new JioPC launch.
JioAirFiber, now with 7.4 million users, has become the world’s largest FWA (Fixed Wireless Access) platform, riding on Jio’s proprietary UBR tech.
Retail grew 11.3% YoY despite a weak quarter for consumer electronics. Grocery and fashion led the charge; Jiomart’s quick commerce volumes jumped 175% YoY and AJIO expanded its catalogue to 2.6 million products.
AJIO Rush, a 4-hour delivery service, was rolled out in 6 cities. On the FMCG front, Reliance Consumer Products doubled revenue YoY to ₹4,400 Cr and is now being spun out of the main retail entity to operate as a focused consumer brand house.
O2C (Oil to Chemicals) delivered a solid 11% YoY EBITDA growth, aided by a sharp jump in domestic fuel sales (diesel up 34%, petrol up 39%) and better cracks on transportation fuels like gasoil and ATF. The segment also benefited from a 13% rise in PP margins and a 4% bump in PVC margins.
However, the upstream Oil & Gas business saw a 4% drop in EBITDA due to a natural production decline in KG D6.
Krishna Godavari Dhirubhai 6 (KG-D6) was Reliance’s first offshore gas field development and its first underwater discovery. It was also India’s largest deposit of natural gas and the largest such discovery in the world in 2002.
Media and Entertainment (JioStar) had its biggest quarter yet with the IPL drawing 652 million digital viewers and JioHotstar averaging 460 million monthly active users.
Subscription revenues grew across TV and digital, while JioStar added exclusive streaming rights for the India-England Test series. JioHotstar also claimed record viewership for shows like Criminal Justice S5 and Kesari 2.
The profitability picture
Net profit jumped to ₹30,783 Cr i.e. a 76% YoY surge but it includes a one-time ₹8,924 Cr gain from monetising its stake in Asian Paints. If we exclude that, PAT growth is still a healthy 25% YoY. This profit uptick also came despite a 19% rise in finance costs, largely due to spectrum-linked capital charges.
ROCE and ROE trends remained healthy across verticals, helped by margin expansion in Jio (now 52% EBITDA margin), disciplined cost control in Retail, and higher fuel throughput in the O2C segment. The company remains in a strong cash position, with Net Debt / EBITDA improving to 0.59x — giving it headroom for future capex.
The next big bets
The most ambitious push is in New Energy. RIL is building India’s first end-to-end green energy manufacturing ecosystem; spanning solar modules, polysilicon, batteries, green hydrogen, and biofuels. Giga-factories are under construction in Jamnagar and Kutch, with commissioning expected over the next 4–6 quarters. A dedicated transmission line is also being laid between Kutch and Jamnagar.
RCPL, the FMCG vertical, has been demerged to build a standalone consumer brand powerhouse. On the retail side, 388 new stores were opened in Q1, taking the total to 19,592. Jio launched new digital offerings like JioAICloud, a freemium AI-integrated storage platform, and JioPC, a cloud-powered desktop computer.
In oil and gas, CBM drilling resumed with a fresh campaign of 40 wells, while in O2C, Jio-bp expanded to 1,991 fuel outlets and 6,292 EV charging points.
Challenges that could shape the next few quarters
- Natural decline in KG D6 output may continue to pressure upstream margins
- O2C profitability remains exposed to volatile global crude prices and polymer demand cycles
- Media (TV) ad revenue remains muted amid cautious FMCG spending
- Execution risk in timely commissioning of giga-factories for solar and batteries
- Competition across telecom and retail could put pressure on ARPUs and store-level economics
What to track before the next earnings call
A few signposts will be key. First, whether Jio goes ahead with a tariff revision, especially given its large 5G base and premium offerings like cloud gaming and bundled PCs.
Second, eyes will be on New Energy milestones; the commissioning of solar modules and battery lines could reshape RIL’s earnings mix.
Third, RCPL’s rollout as a standalone FMCG play and its performance during the upcoming festive quarter will signal market traction.
In retail, Jiomart’s hyperlocal model and AJIO’s premium push are worth watching for both growth and margin performance. Lastly, refining cracks and polymer deltas in the O2C segment especially PP and PVC will be crucial indicators of margin direction.
The road ahead
This wasn’t Reliance’s loudest quarter but it was a deeply telling one. Every segment, from digital to refining to retail, showed up with execution. Earnings were boosted by an equity windfall, yes, but even without it, the core story is one of breadth and discipline.
The broader outlook for each vertical is still compelling. India’s energy needs are rising, digital consumption remains strong, and formal retail is accelerating beyond Tier 1.
If Reliance keeps executing across these tracks while commissioning its New Energy bets on time, the next few quarters may not just be about scale but about rewriting the unit economics of the conglomerate.
Sometimes, steady outperformance is the clearest sign of long-term disruption.
FAQs
What were Reliance Industries’ Q1 FY26 results?
Reliance Industries reported a net profit of ₹30,783 crore in Q1 FY26, up 76% YoY, aided by a one-time gain from the sale of its Asian Paints stake. Revenue from operations stood at ₹2.73 lakh crore, and EBITDA rose 19% QoQ to ₹58,024 crore, driven by strong digital and retail performance.
How did Jio perform in Reliance’s Q1 FY26 earnings?
Jio added 10 million subscribers in Q1 FY26, taking its user base to 498 million, with 210 million on 5G. EBITDA from digital services grew 23%, aided by higher data usage and services like JioGames and JioAICloud. ARPU stood at ₹209, reflecting increased bundled service adoption.
What’s the latest update on Reliance Retail in Q1 FY26?
Reliance Retail saw 11.3% YoY growth, with digital grocery orders up 175% and fashion platform AJIO expanding its catalogue to 2.6 million products. The FMCG arm, RCPL, doubled revenue to ₹4,400 crore and is being spun off into a standalone consumer brand house.
What drove Reliance’s profit growth in Q1 FY26?
Net profit rose to ₹30,783 crore, boosted by an ₹8,924 crore gain from selling its Asian Paints stake. Even excluding this, PAT grew 25% YoY, driven by strong margins in digital, retail, and domestic fuel. The EBITDA margin for Jio hit 52% this quarter.
What is JioAirFiber and how big is it now?
JioAirFiber is Reliance’s fixed wireless access (FWA) broadband service. It now has 7.4 million users and is the largest FWA platform globally, powered by Jio’s in-house UBR technology. It offers high-speed internet for homes and businesses without needing physical fibre cables.
How did the O2C segment perform for Reliance in Q1 FY26?
Reliance’s Oil to Chemicals (O2C) segment saw 11% YoY EBITDA growth, driven by a surge in domestic fuel sales and improved margins in polymers like PP and PVC. However, upstream Oil & Gas EBITDA fell 4% due to natural production decline in KG-D6.
What is the status of Reliance’s green energy business?
Reliance is building India’s first integrated New Energy ecosystem, with giga-factories for solar modules, batteries, and green hydrogen under construction in Jamnagar and Kutch. Commissioning is expected in 4–6 quarters, with a dedicated transmission line connecting both sites.
What are the risks Reliance faces after Q1 FY26?
Key risks include declining output from KG-D6, volatility in crude and polymer prices, execution delays in green energy projects, muted TV ad revenue, and growing competition in telecom and retail, which could impact ARPU and store profitability in future quarters.
Has Reliance demerged any business in Q1 FY26?
Yes, Reliance demerged its FMCG business, Reliance Consumer Products Ltd (RCPL), to operate as a focused standalone entity. This move is aimed at building an independent consumer brand powerhouse with stronger capital allocation and strategic flexibility in the FMCG space.
What to watch in Reliance’s next quarter results?
Watch for a potential Jio tariff hike, commissioning milestones in New Energy, festive-quarter traction for RCPL, growth in hyperlocal Jiomart and AJIO, and margin movements in O2C from polymer spreads and refining cracks. These will define earnings direction ahead.
