RIL shares fall after soft Q2 results; here are stock price targets

Reliance Industries Ltd (RIL) saw its shares falling nearly 1 per cent in Tuesday's trade, as investors digest the second straight quarter of soft results. The standalone RIL numbers were hit by weaker refining and petchem spreads. The revenue print for Reliance Retail was weak, but margin improved. In the case of RJio, the tariff hike flow-through was offset by higher subscriber churn. As a result, a couple of brokerages cut their target prices on the stock.

MOFSL said RJio will be the biggest driver of Ebitda growth over FY24-27, driven by more frequent tariff hikes, market share gains in wireless, and the ramp-up of its Homes and Enterprise business. It sees growth recovery in Reliance Retail after the recent rationalisation of unprofitable stores and B2B, driven by increased footprint, category additions, and a potential foray into quick commerce.

"We value RIL’s standalone business at 8x Dec’26E EV/Ebitda to arrive at a valuation of Rs 1,001 per share. We ascribe an equity value of Rs 1,001 er share to RIL’s equity stake in RJio and Rs 1,319 per share to RIL’s equity stake in Retail, as well as assign Rs 89 per share to RIL’s New Energy business," it said while revising its target price to Rs 3,255 from Rs 3,410 earlier.

The RIL stock was trading 0.7 per cent lower at Rs 2,726 on BSE. With this, the scrip is down 7.61 per cent in the past one month. Antique Stock Broking said it has cut its FY25, FY26 and FY27 Ebitda estimates for RIL by 3.6 per cent, 3.5 per cent and 3.3 per cent on the back of weaker retail run rate (for FY25) and O2C over the next two years.

"We also cut our fashion and lifestyle business EV/Ebitda multiple as part of our SoTP to 27 times from 32 times and grocery business EV/Ebitda multiple to 22 from 28, even as we roll forward our valuation to FY27E vs. 1HFY27E. Maintain HOLD with a revised SoTP price targe of Rs 2,846 per share (down from Rs 3,194 per share)," it said.

HDFC Institutional Equities retained its RIL target price of Rs 3,350 per shares. Nuvama suggested a target price of Rs 3,650 on huge new energy prospects.