Reliance Industries gained 2.6% on bourses amid weakness in the broader market on Friday following better than expected performance in the third-quarter driven by the retail and O2C segments.

On the retail front, the company continued to add stores on a net basis but the area declined reflecting focus on profitable growth.

After a festive demand pull, the growth rates for the retail segment are expected to normalise in the fourth quarter.

The O2C segment may face pressure given weaker oil and polymer cracks at the beginning of the March quarter.

The digital segment is expected to show normalisation in the net subscriber additions , which may limit the average revenue per user (ARPU) expansion.

The digital segment reported a sustained net subscriber addition and improved ARPU helped by tariff revisions.

Of the 3.3 million net additions, two million were in the home broadband connections category implying increasing penetration.

In addition, data traffic grew by 22% year-on-year and 3.3% sequentially to 46.5 billion.

However, the ARPU growth at 4.2% sequentially missed analyst estimates of 5-5.5% increase reflecting a lower benefit of rising tariffs.

ETMarkets.

com The next round of tariff increase is expected in December 2025, which means the ARPU improvement will depend upon the introduction of new plans and user adoption of 5G services.

In the December quarter, 5G subscriber base expanded by 14.9% sequentially to 170 million and contributed 40% to data usage.

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Its operating margin before depreciation and amortisation (EBITDA margin) improved by 20 basis points year-on-year to 8.3% on a revenue growth of 7% to ₹79,595 crore.

The share of digital commerce improved to 18% from 17% sequentially.

However, the offline business rose by 10% year-on-year, faster than the 3% increase in digital commerce.

The net store area declined by two million square feet (msf) to 77.4 msf from the previous quarter while net count improved by 156 to 19,102. This highlights streamlining of operations amid traction in grocery, consumer electronics, fashion and lifestyle segments.

The upstream oil and gas division reported lower revenue growth and EBITDA margin from the year ago due to lower production volume from KG D6 basin and lower realisation.

In the refining O2C division, the fall in the realisations (cracks) of transportation fuels amid lower Chinese demand and ample global supply led by higher refinery output in the US was partially offset by higher refining throughput and strong domestic demand.

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