Mukesh Ambani’s market-leading conglomerate stock has received ambitious target prices from several prominent brokerages, significantly fueling optimism and driving the stock’s upward trajectory. This positive sentiment reflects the strong potential for future growth and investor interest in the company.
Share Price Movement
In Monday’s trading session, Reliance Industries Limited‘s share price reached an intra-day high of Rs.2,793.00 per share, a 0.7 percent rise from its previous close of Rs.2,773.05 apiece. The share has retreated since then and currently trading at Rs.2,765.05 per share.
Target Recommendation
Several brokerage firms have initiated ratings on Reliance Industries Limited (RIL). In line with this, Research Analyst Anoushka Roy at Trade Brains has assigned a “Buy” rating to RIL, setting a target price of Rs.3,250 per share. This target reflects an upside potential of 17 percent from the current market price.
The research report from Trade Brains highlights several factors contributing to this positive outlook, including rising operating revenues across all business segments, assertive management guidance, and a strong emphasis on continuous innovation and enhancement of product quality.
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Business Segments and Revenue
Reliance operates across several key segments, including energy (oil refining and petrochemicals), retail (featuring a diverse range of store formats), telecommunications (primarily through Jio Platforms), and textiles. Furthermore, the company has expanded into new energy, logistics, and life sciences, solidifying its position as one of India’s largest conglomerates.
The company generates 57.3 percent of its revenue from the Oil to Chemicals (O2C) segment, followed by 27.7 percent from retail services. Digital Services account for 11.5 percent of revenue, while the Media and Entertainment segment contributes 3.4 percent.
Investment Rationale
Reliance JIO stands out as the world’s largest operator in data traffic consumption and aims to be the leading 5G service provider. The company is focused on expanding its AirFiber and 5G offerings while preparing to launch two new applications, JioSafe and JioTranslate.
In the retail sector, Reliance has established Reliance Consumer Products Ltd (RCPL) with an investment of Rs.3,900 crore, targeting the fast-moving consumer goods (FMCG) market.
RIL also plans a capital expenditure of Rs.1,31,769 crore in FY24, primarily for digital services and retail expansion, while pursuing new energy initiatives backed by substantial government support.
Financials
In the latest financial update, the company reported net sales of Rs.2,31,784 crore for Q1 FY25, marking an increase of approximately 11.7 percent from Rs.2,07,559 crore in Q1 FY24. Net profit decreased to Rs.17,445 crore, compared to Rs.18,258 crore in the same period last year.
Company Overview
Reliance Industries Limited (RIL) is India’s largest private sector company and is listed among the Fortune 500 firms. The company operates across various sectors, including hydrocarbon exploration and production, petroleum refining and marketing, petrochemicals, advanced materials, and composites.
RIL is also engaged in renewable energy initiatives, such as solar and hydrogen. Furthermore, the company has a significant presence in retail and digital services.
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Written by – Siddesh S Raskar
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