Reliance Industries Limited (RIL) has been under the spotlight with various brokerage firms providing their outlook following the company’s recent performance. Here’s a summary of views from different brokerage houses:
- Jefferies has maintained a Buy rating with a target price of Rs 3,400, indicating a 24% upside from the current market price of Rs 2,745.50. The firm noted a weak print in the Oil to Chemicals (O2C) business along with small misses in Jio and Retail segments. Jefferies expects a focus on B2B and store rationalization in Retail over H2FY25, with growth recovery expected in FY26. Jio’s subscriber decline was a surprise, but the firm expects strong growth over FY25-27. Despite lowering FY25-26 EBITDA estimates by 8-6%, the recent 14% stock correction makes valuation favorable, according to Jefferies.
- Morgan Stanley reiterated an Overweight rating, setting a target price of Rs 3,325, which suggests a 21% upside from the current levels. The brokerage pointed out that while Q2 EBITDA missed estimates due to weak domestic demand, profits exceeded expectations owing to lower depreciation. Morgan Stanley highlighted that capex intensity and net debt rose QoQ. However, cyclical challenges in Retail and Refining are expected to unwind in 2025, reversing the current estimate downgrade cycle.
- Nomura also retained its Buy call, raising the target price to Rs 3,450, offering a 26% potential upside. The brokerage noted that RIL’s Q2 results were below expectations in a challenging environment, and it cut FY25-27 EBITDA by 5-6%. Despite this, the longer-term outlook remains positive, driven by upcoming tariff hikes for Jio, value unlocking in Jio, sustained retail growth, and the commencement of new energy operations by March 2025.
- Systematix upgraded its rating to Buy Hold, increasing the target price to Rs 3,145, with a 15% upside from the current price. The firm cited weakness in the O2C and Retail segments, which weighed on EBITDA, but expects a recovery in both areas in the second half of FY25. Systematix also expects ARPU to rise over the next 2-3 quarters in the digital services segment.
- Nuvama has maintained its Buy rating on RIL, raising its target price to Rs 3,650, implying a potential upside of 33%. Despite a difficult quarter, Nuvama highlighted an EBITDA beat of 1%, driven by better-than-expected performance in the O2C, Oil & Gas, and Digital segments. The brokerage also pointed to the company’s promising new energy initiatives, which are expected to contribute over 50% of consolidated profits by 2030.
Brokerage views on RIL:
Upside % is calculated on Reliance share price as on 15 Oct, 8AM: 2,745.50 INR
| Brokerage | Rating | Target Price (Rs) | Upside (%) | Key Highlights |
|---|---|---|---|---|
| Jefferies | Buy | 3,400 | 24 | Weak print in O2C; small misses in Jio & Retail. Expect recovery in FY26. |
| Morgan Stanley | Overweight | 3,325 | 21 | Cyclical challenges in Retail & Refining; expect recovery in 2025. |
| Nomura | Buy | 3,450 | 26 | Tariff hikes for Jio, value unlocking, and new energy operations by March 2025. |
| Systematix | Buy Hold | 3,145 | 15 | Weakness in O2C & Retail; ARPU to rise in next 2-3 quarters. |
| Nuvama | Buy | 3,650 | 33 | EBITDA beat of 1%; New energy to contribute 50%+ of profits by 2030. |
Brokerages continue to remain largely optimistic about Reliance Industries, with expectations of strong upside driven by recovery in core segments like Retail, O2C, and growth in Digital Services, alongside the potential for new energy ventures to play a significant role in the long term.
Disclaimer: The information provided in this article is based on research reports from various brokerage firms and does not reflect the views or opinions of the author or the publication. It is intended solely for informational purposes and should not be construed as investment advice or a recommendation. Readers are advised to conduct their own research or consult with a licensed financial advisor before making any investment decisions. The author and the publication disclaim all liability for any investment decisions made based on the information provided in this article.
