JP Morgan has maintained its ‘Overweight’ rating on Reliance Industries Limited (RIL) and sees a potential upside of up to 25% from current levels. The brokerage has examined downside risks amid broader market pressure, particularly evaluating valuation impacts on RIL’s telecom and retail segments.
JP Morgan notes that a material downside of 15% from current levels would require extreme valuation contractions in its telecom and retail businesses, even after factoring in earnings risks. However, it views this scenario as low probability and suggests that any correction in RIL’s valuation would likely be part of a broader market trend rather than an isolated impact on the stock.
The brokerage highlights commodity price fluctuations and uncertainties around FY26 telecom tariff increases as risks to RIL’s EBITDA forecasts. Additionally, near-term catalysts for stock movement appear limited.
Despite these concerns, JP Morgan sees reasonable value in RIL post correction and expects potential upside from key triggers such as:
- Recovery in the retail segment’s growth,
- Telecom tariff hikes, and
- Valuation upside from potential listing of subsidiaries over the next few quarters.
The stock is currently trading at ₹1,216.20 per share.
