Reliance Industries’ Q3 marks return to growth after 6 months of challenges, says Morgan Stanley

Morgan Stanley upgraded its view on Reliance Industries, maintaining an Overweight rating with a target price of ₹1,662. The brokerage highlighted that Q3 earnings marked a return to growth for the company after facing six months of challenges.

Morgan Stanley upgraded its view on Reliance Industries, maintaining an Overweight rating with a target price of ₹1,662. The brokerage highlighted that Q3 earnings marked a return to growth for the company after facing six months of challenges. EBITDA exceeded expectations, supported by better performance in the energy segment and a turnaround in retail earnings.

The chemicals division outperformed industry benchmarks in terms of margins, while retail EBITDA rose 9% YoY, and revenues increased by 7% YoY despite store rationalization efforts. Morgan Stanley emphasized that the Q3 results included elements that could lead to a stock re-rating back to mid-cycle multiples, particularly as risk associated with downgrades unwinds. The brokerage also moved Reliance Industries up one notch in its preference order, viewing it as a key player in the sector’s recovery.

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Reliance Q3FY25 Results:

  • Net Profit: ₹18,540 crore (+7.4% YoY)
  • Revenue: ₹2.40 lakh crore (+6.6% YoY)
  • EBITDA: ₹43,789 crore (+8% YoY)
  • EBITDA Margin: 18.3% (vs. 18.1% YoY)