Reliance standalone profit falls 25.87% despite 40.65% revenue growth
Lower other income and a 12.76-point rise in the tax rate outweighed the year-on-year improvement in operating margin.
Filed 17 Jul 2026, 19:49 IST · after market close · Reliance Industries Ltd (RELIANCE)
Key takeaways
- Standalone net profit fell 25.87% year on year to Rs 13,272 cr despite revenue growth of 40.65%.
- Operating margin recovered 5.66 percentage points sequentially because revenue grew 15.38% while expenses rose 8.63%.
- Other income contributed 23.34% of pre-tax profit, while the tax rate rose 12.76 percentage points year on year to 24.59%.
Price around the results
Operating recovery did not translate into higher annual profit
Reliance's standalone revenue grew 40.65% year on year, while operating profit rose 47.32%, lifting operating margin by 0.40 percentage points. That operating improvement was offset by a 69.48% fall in other income and an 80.18% rise in tax, leaving net profit down 25.87%. Sequentially, net profit rose 78.82% as the operating recovery from Q4FY26 took effect.
Margin rebounded from Q4FY26, but remains below the Energy peer median
Sequential margin expansion came from revenue growing 15.38% against expense growth of 8.63%, widening operating margin by 5.66 percentage points. Interest expense rose 25.29% sequentially, but did not prevent the operating improvement from lifting pre-tax profit by 79.90%. At 8.88%, the standalone operating margin was 6.61 percentage points below the 15.49% median for six Energy peers that had reported, placing Reliance fourth from the bottom.
The quarterly margin path has turned up after three weaker quarters
Operating margin moved from 8.48% in Q1FY26 to 5.50% in Q2FY26, 5.60% in Q3FY26 and 3.22% in Q4FY26 before recovering to 8.88% in Q1FY27. The latest result therefore breaks the recent sequential decline, while only modestly exceeding the year-ago margin. Profit quality remains mixed because other income still accounted for 23.34% of pre-tax profit and the tax rate was 24.59%, versus 11.83% a year earlier.
The initial stock reaction was mild relative to Reliance's history
The stock fell 0.31% on the first reaction day, with a 0.75% opening gap lower and a 1.77% decline by the next session. Across eight recent results reactions, the stock was up four times and down four times, with a median absolute move of 3.21%. The latest move was therefore smaller than its usual post-results swing.
Q1FY27 at a glance
Standalone figures as filed with NSE — cross-checked against an independent source.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹1,63,631 cr | ₹1,41,823 cr | +15.38% | +40.65% |
| Other income | ₹4,108 cr | ₹3,357 cr | +22.37% | -69.48% |
| Expenses | ₹1,49,095 cr | ₹1,37,252 cr | +8.63% | +40.03% |
| Operating profit | ₹14,536 cr | ₹4,571 cr | +218.00% | +47.32% |
| Operating margin (%) | 8.88% | 3.22% | — | — |
| Interest | ₹1,838 cr | ₹1,467 cr | +25.29% | -16.23% |
| Depreciation | ₹4,196 cr | ₹4,069 cr | +3.12% | +1.60% |
| Profit before tax | ₹17,600 cr | ₹9,783 cr | +79.90% | -13.33% |
| Tax | ₹4,328 cr | ₹2,361 cr | +83.31% | +80.18% |
| Net profit | ₹13,272 cr | ₹7,422 cr | +78.82% | -25.87% |
| EPS (₹) | ₹9.81 | ₹5.48 | +79.01% | -25.85% |
Operating margin of 8.88% compares with a Energy sector median of 15.49% across 6 peers that have reported Q1FY27.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -0.31% | +0.08% |
| Next session | -1.77% | — |
Volume on the results session was 1.06× its 20-day average.
What to watch
- Whether operating margin holds above 8.88% after the Q1FY27 rebound.
- Whether other income remains close to 23.34% of pre-tax profit.
- Whether the tax rate moves away from 24.59% after its year-on-year increase.