Reliance Industries shares surged nearly 3% on Monday morning, trading at ₹1,300.30, up ₹34.90 or 2.76% from the previous close of ₹1,265.40 on the NSE. The stock’s movement follows an upgrade by Citi, which has revised its rating to ‘Buy’ and increased the target price to ₹1,530, citing a favorable risk-reward scenario.
Key Highlights from Citi’s Report:
- Valuation Opportunity: Reliance has underperformed the broader Indian market by 20% over the last six months, presenting an attractive entry point for investors.
- Refining Margins: Improvement expected, driven by a decline in China’s export competitiveness.
- Telecom Growth: Jio is well-positioned to benefit from:
- Potential tariff hikes.
- Improved data pricing.
- Monetization of 5G services.
- Retail Softness: Marginal downside with a 1% cut in consolidated EBITDA estimates for FY25-27 due to expected softness in the retail segment for a few quarters.
Citi’s upgrade aligns with its belief in Reliance’s diversified business model and potential recovery across its core verticals—refining, telecom, and retail. The brokerage emphasizes the stock’s upside potential given the current valuation and upcoming triggers like 5G monetization and improving global refining trends.
