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Reliance Retail Q2FY22 preview: Good revenue recovery expected on favourable base

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For Reliance Retail, this time around a good revenue recovery is expected both on a quarter-on-quarter (QoQ) and year-on-year (YoY) basis due to a favourable base. The EBITDA on the back of that revenue jump, will also likely jump a lot more on account of the operating leverage.

For Reliance Retail, this time around a good revenue recovery is expected both on a quarter-on-quarter (QoQ) and year-on-year (YoY) basis due to a favourable base. The EBITDA on the back of that revenue jump, will also likely jump a lot more on account of the operating leverage.
Quarter on quarter 
Nomura estimates revenues at around Rs 43,450 crore which is 13 percent jump QoQ and 11 percent YoY and EBITDA, a much higher jump at 53 percent QoQ and 47 percent YoY. For the margins, this would mean a jump of 180 basis points from 5.1 percent to 6.9 percent.
The street is excited about the company's recent moves--the tie-up with 7-Eleven stores in India and also the two designer purchases of about 40 percent stake buy in Manish Malhotra Fashions and 52 percent stake in Ritu Kumar. Moreover, the company also opened the Jio World Drive mall.
All these moves are steps towards Mukesh Ambani’s vision of making Reliance Retail growth three times in the next three to five years and to be among the top 10 retailers in the world.
 
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