Reliance Jio’s profits shot up nearly three times as it announced the results for Q4 of FY20. Jio registered a net profit of Rs 2,331 in Q4, which came due to an addition in subscribers as well as a tariff hike, which led to the Average Revenue Per User (ARPU) increasing as well. Quarterly operating revenue increased 26.6% YoY to Rs 14,835 crore
The company’s net profit increased from Rs 2,964 crore in FY19 to Rs 5,562 crore in FY20, an 88% increase. It saw a 177% YoY rise in net profit for the quarter. It was Rs 840 crore during the same period last year.
Jio’s ARPU increased from Rs 128.4 in the previous quarter to Rs 130.6 per month in Q4.
Jio also said that post the Facebook-Jio deal, the company has received “strong interest” from strategic and financial investors, and “is in good shape to announce a similar sized investment in the coming months.”
Jio subscriber base
Jio reported that its subscriber base has grown year on year by 26.3%, and totally has 387.5 million subscribers. In Q4 alone, it added 17.5 million subscribers.
The company said it added 23.9 million gross subscribers during the quarter and 126.4 million in FY20.
“Aggressive sales initiative and customer focused approach have been launched to help recoup slowdown in subscriber addition momentum, as we return to normalcy. FTTH [fiber to the home] and Enterprise services remain large greenfield opportunities with demand further reinforced due to Work from Home during the lockdown,” it stated in a release.
Jio said its churn rate, or the rate at which subscribers leave a service, has returned to what it was before Q3 — when it eliminated excessively heavy voice users.
“Jio continues to be a net recipient of access charges with outgoing traffic mix within the overall offnet traffic [calls or messages made to another network] now stable at 48-49%,” Jio said.
Customers were consuming an average of 11.3 GB a month and used voice minutes of about 771 minutes per month.
Facebook’s investment in Jio
Last week, Jio announced that Facebook would be investing Rs 43,574 crore into Jio Platforms for a 9.99% equity stake.
On Thursday, Jio stated that Rs 14,976 crore will be retained at Jio Platforms for drive future, and Reliance Industries will redeem Optionally Convertible Preference Shares (OCPS) of Rs 28,598 crore.
Following Facebook’s investment, Jio Platform’s market equity value is Rs 4,36,172 cr.
“Concurrent with the investment, Jio Platforms, Reliance Retail Limited (“Reliance Retail”) and WhatsApp have also entered into a commercial partnership agreement to further accelerate Reliance Retail’s New Commerce business. JioMart would be integrated with WhatsApp to ensure that consumers are able to access the nearest kiranas who can provide products and services to their homes by transacting seamlessly with JioMart using WhatsApp,” Jio stated.
Reliance Industries had a target of having zero net debt by March 2021, and says it is set to achieve the target even ahead of the timeline.
JioMeet
In addition to this, the company announced that it was launching JioMeet, a video conferencing app. With this, it takes on Zoom, Skype, Google Meet, Cisco Webex and Microsoft Teams and the like, which have gained newfound importance in the lockdown era.
JioMeet is already available on the Google Play Store, the Apple App Store, and a third-party plugin for Microsoft Windows Marketplace. It is also accessible through web browsers.
Group calling on the platform allows up to 100 participants to be on a video call.
Overall, Reliance Industries announced a decline in profit after tax of 37.2% for Q4 at Rs 6,546 crore as against Rs 10,427 crore in the corresponding period of the previous year. Its revenue from operations declined YoY by 2.4% and saw a 0.1% rise in consolidated profit.