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Reliance Industries Share Price: Brokerages delivered a mixed verdict on Reliance Industries following its Q4 FY26 results, trimming target prices to factor in continued weakness in the oil‑to‑chemicals (O2C) and upstream businesses, even as most maintained their Buy/Overweight ratings on the stock. The caution stemmed from a 13 per cent year‑on‑year decline in consolidated net profit to Rs 16,971 crore and a margin miss, driven largely by energy‑segment pressures amid elevated crude prices and policy headwinds. However, analysts remain structurally bullish on Reliance’s long‑term story, citing steady growth in telecom and retail, improving free cash flows at Jio, and long‑term value from new energy investments and potential monetisation triggers, including a Jio listing and Retail scale‑up.
Brokerages On Reliance Industries
Motilal Oswal On Reliance
- The brokerage maintains ‘Buy’ with a target price of Rs 1,655 (earlier 1715)
- Energy profitability weak; resilient consumer business softens the blow
- Cut FY27E EBITDA ,PAT by 3-4 per cent due to the challenges in the Energy business and delays in tariff hikes
- Build in a CAGR of 9-10 per cent in consolidated EBITDA/adj. PAT over FY26-28E
- Key triggers – sustained mid-to-high teen growth in RR and a tariff hike, impending JPL IPO
- Reliance Retail – Growth picks up; margin moderates due to QC ramp-up
- Project a 12 per cent/10 per cent CAGR in RR’s revenue and EBITDA over FY26-28
- RJio – Largely in line; FCF generation picks up as capex moderates
- Standalone: Weak O2C and E&P performance drive miss
- Expect RJio to remain the biggest growth driver
- Projects an annual consolidated capex of INR 1.25 lakh crore for RIL over FY26-28E
- The brokerage maintains ‘Overweight’ with a target price of Rs 1,803 (maintained)
- Earnings largely in line but EBITDA slightly missed due to upstream costs
- Retail growth strong led by quick commerce and FMCG
- O2C margins weak vs peers but improving crude sourcing trends
- Chemicals and fuel markets showing early signs of recovery
- Capex remains elevated with focus on new energy
- Re-rating dependent on margin improvement across segments
- Viewed as top pick with energy and retail recovery as key triggers
Elara Capital on Reliance Industries
- The brokerage upgraded to ‘Buy’ with a target price Rs 1,619 (revised downward)
- Weak O2C margin capture despite strong product cracks
- Digital and Retail segments provide steady growth support
- Retail margins under pressure due to investments
- Oil & Gas and O2C segments drag overall performance
- EPS estimates cut due to weaker petchem and retail outlook
- Stock correction factors in near-term headwinds
- Upside driven by GRM normalization and digital growth
Nuvama On Reliance
- The brokerage maintains ‘Buy’ with a target price of Rs 1,765.
- Q4FY26 EBITDA at Rs 441bn which was 6 per cent below consensus
- New Energy rollout on track with 6/2GW module/cell capacity started
- Most gigafactories starting by end-FY27
- O2C weakness to persist in Q1 as impact of SAED on export and steep OMC discount of INR60/50/46 per litre on refinery transfer pricing for diesel/ATF/kerosene
- NE rollout to not only add 50 per cent + to PAT, but also re-rate valuation, including O2C given its net zero-carbon target by 2035
- Cutting FY27/28E EBITDA by 5 per cent /3 per cent to factor in weak O2C/retail
- The broekrahe maintain ‘Buy’ on RIL with a target price of Rs 1,680.
- RIL reiterated scaling up its consumer businesses;
- Jio listing process is advancing, with filings expected soon
- O2C scenario has improved sequentially.
- Cut FY27/28E EBITDA-APAT by 5-6 per cent each, building in the lower Retail margin and reducing other segments and upstream earnings.
- O2C earnings are largely unchanged, albeit with upside potential
Reliance Industries Q4FY26 Result
Reliance Industries reported a 13 per cent year-on-year decline in its consolidated net profit at Rs 16,971 crore for Q4 FY26, highlighting pressure on overall profitability as the global energy crisis weighed on its core oil-to-chemicals business, offsetting gains in its consumer-facing telecom and retail segments. On a sequential basis, profit fell 9 per cent from Rs 18,645 crore in the preceding October-December quarter.
The oil-to-chemicals (O2C) business, which contributes the lion’s share of revenue to the country’s most valuable company, was impacted by the war in West Asia, which triggered a sharp rise in crude oil prices and elevated freight, insurance, and fuel costs.
Profitability was also hit by a move from state-run fuel retailers to cap margins on petrol and diesel purchases from Reliance, as they sought to offset losses from a freeze in retail fuel prices. To remain competitive, Reliance similarly refrained from raising pump prices in line with the surge in crude oil costs, further pressuring margins.
The weakness in the oil-to-chemicals (O2C) business offset double-digit revenue growth in the telecom and retail segments. The telecom business saw earnings grow from a higher subscriber base, as well as increased per-user earnings, while the hyperlocal segment of retail saw handsome order bookings.
Despite the drop in profit, the oil-to-telecom conglomerate posted a 13 per cent YoY rise in its consolidated revenue from operations to Rs 2.94 lakh crore, indicating resilient top-line growth. It stood at Rs 2.61 lakh crore in the same quarter of the previous financial year.
Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) came in at Rs 44,141 crore in the reporting quarter, representing a marginal growth of 1 per cent YoY from Rs 43,832 crore in the year-ago period. Margins were at 15 per cent in Q4 FY26 against Rs 16.8% Q4 FY25, down 180 bps YoY.
The total income, however, rose to Rs 3.03 lakh crore in Q4, compared to Rs 2.69 lakh crore a year ago. For the full financial year, the company posted a record net profit of Rs 80,775 crore, marking a 16 per cent increase from Rs 69,648 crore in FY25.
Depreciation was up 10 per cent at Rs 14,808 crore, largely on account of higher depreciation in digital services from network assets. Also, finance costs increased 7 per cent to Rs 6,585 crore, mainly due to operationalisation of 5G spectrum assets. For the full year, Reliance posted record high revenue of Rs 11.75 lakh crore and an all-time high EBITDA of Rs 2.07 lakh crore.
(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money related decisions.)
