The shares of the Reliance Group company specialize in and operate across a wide range of industries, including energy, petrochemicals, retail, telecommunications, and media, are in focus after leading Brokerage firm Investec initiated a Buy Target with an upside potential of 35 percent.
With a market capitalization of Rs. 19,24,317.61 Crores on Friday, the shares of Reliance Industries Ltd jumped upto 1.2 percent, making a high of Rs. 1415.50 compared to its previous closing price of Rs. 1398.05.
Reliance Industries Ltd engages in and operates across a wide range of industries, including energy, petrochemicals, retail, telecommunications, and media. Its diverse business is conducted through several major subsidiaries and divisions, are in focus after a leading brokerage firm, Investec, initiated a Buy Target of Rs. 1,890 on it with an upto 35 percent Upside Potential from yesterday’s close price.
The reasons for the “Buy” target
Strong Innovation and Revenue Growth Outlook
Investec is highly optimistic about Reliance Industries, projecting significant revenue growth driven by both cyclical recovery and structural business expansion. The company is poised for broad-based earnings recovery with an expected doubling of group-level EBITDA by FY27 compared to FY22, driven by new petrochemical capacities, strong refining margins, and stable upstream earnings.
The non-energy business is expected to contribute significantly to this growth, with Reliance Retail forecasted to grow at a 14% CAGR and Reliance Jio continuing its strong expansion in Average Revenue Per User (ARPU), underpinning the company’s dominance in India’s telecom sector.
Positive Earnings Trajectory and EPS Growth
The stock is projected to deliver solid earnings growth over the next few years. The price-to-earnings (P/E) ratio is set to remain attractive, trading at a 15% discount compared to its historical average from 2018-2025. This suggests that Reliance is undervalued relative to its future growth potential.
Strategic Value Unlocking and Potential Catalysts
A key catalyst for further value creation is the potential IPOs of Reliance’s subsidiaries, which could provide multiple avenues for value unlocking and enhance the company’s capital efficiency. These moves, combined with the overall growth in energy and non-energy businesses, position Reliance as a compelling investment opportunity with substantial upside potential.
Financials & Others
The company’s revenue rose by 5.11 percent from Rs. 231,784 crores to Rs. 243,632 crores in Q1FY25-26. Meanwhile, Net profit rose from Rs. 17,445 crores to Rs. 30,783 crores in the same period.
Reliance Industries Ltd (RIL) is one of India’s largest and most diversified conglomerates, founded by Dhirubhai Ambani in 1966. Headquartered in Mumbai, RIL operates across a wide range of sectors, including petrochemicals, refining, oil & gas exploration, telecommunications (through its subsidiary Jio), and retail. It is a dominant player in India’s energy, retail, and digital sectors, with a significant global presence.
RIL’s flagship business, the refining and petrochemical division, is one of the largest in the world. The company also made a major shift into the telecommunications market with Jio, which rapidly expanded and disrupted the Indian market with affordable 4G internet services. RIL’s retail business has been expanding rapidly, with a large footprint across India and partnerships with global brands.
It has become a key contributor to the Indian economy, not only through its business activities but also through its investments in sustainable energy, green hydrogen, and other future-facing industries.
Written by Sridhar J
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