Posted on March 10, 2025, by Niftynews
Reliance Industries stock has seen a 4% gain in March, bouncing back from a 5% decline in February, as brokerages turned optimistic about its prospects. Several brokerages, including Macquarie, Morgan Stanley, and Kotak Institutional Equities, have raised their price targets, signaling confidence in the company’s recovery and long-term growth. At its current trading price of ₹1,244.40, Reliance shares are 23% below their peak of ₹1,608.95 in July 2024, but positive developments in its key segments are fueling hopes of a rebound.
Brokerage Views on Reliance Industries Stock
Brokerages are increasingly optimistic about Reliance Industries, with positive upgrades and price target revisions that suggest substantial upside potential.
- Macquarie has upgraded its rating to “Outperform” from “Neutral” and raised its target to ₹1,500. This represents a 20% upside from the stock’s closing price on Friday. Macquarie highlighted several catalysts for growth, including better earnings momentum, the potential listing of Jio, and new energy capacities coming online.
- Morgan Stanley has maintained an “Overweight” rating, setting a target of ₹1,606, which suggests a 28.5% upside. The brokerage notes that Reliance is undergoing a multi-stage earnings recovery, with early signs of improvement in refining and chemical segments. The rebound in Asian chemical multiples also supports the positive outlook.
- Kotak Institutional Equities upgraded Reliance to “Buy” from “Add” and raised its price target to ₹1,400, implying a 12% upside. The brokerage sees a recovery in the retail business as the store-rationalization cycle concludes. Kotak also remains optimistic about Jio’s long-term growth despite some short-term challenges, including delays in tariff hikes.
Key Catalysts for Reliance Industries Stock Recovery
Several factors are contributing to the renewed optimism surrounding Reliance Industries:
- Earnings Momentum: After a challenging period, Reliance’s earnings are expected to recover, driven by improving refining and chemical segments. The growth in these sectors is expected to accelerate in the coming quarters.
- Jio’s Potential Listing: The potential public listing of Reliance Jio, India’s largest telecom operator, is another significant catalyst that could boost the company’s valuation. The upcoming IPO is expected to unlock value and attract investor interest.
- Energy Expansion: Reliance’s continued expansion in the energy sector, including investments in new energy capacities, provides long-term growth prospects. The company’s foray into renewable energy and hydrogen technologies is expected to complement its traditional energy business.
- Retail Business Recovery: After facing challenges in the retail segment, Reliance is set to benefit from an improved outlook as the rationalization of stores concludes. This will likely lead to stronger performance in the retail arm.
Challenges and Risks for Reliance Industries
Despite the positive outlook, there are some risks that investors need to consider:
- Telecom Tariff Hikes: Delays in tariff hikes in the telecom sector may reduce ARPU (average revenue per user) estimates for Jio in FY26. However, analysts believe this impact will be offset by the rapid growth in Jio’s broadband subscriber base, driven by the expansion of Jio AirFiber.
- Retail Segment Weakness: While the retail segment is expected to recover, it has been a weak point for Reliance in recent quarters. Any further challenges in the retail business could impact the company’s overall performance.
- Energy Price Volatility: The energy sector remains vulnerable to price fluctuations, which could impact Reliance’s earnings from its refining and chemical businesses.
Is It Time to Buy Reliance Industries Shares?
With brokerages upgrading their price targets and issuing positive ratings, now may be a good time for investors to consider buying Reliance Industries shares. The company is expected to experience a multi-stage earnings recovery, with key catalysts such as the potential Jio IPO and improvements in the retail and energy segments. However, investors should be mindful of potential short-term challenges, particularly in the telecom and retail sectors.
As Reliance Industries navigates its recovery, the coming months will be crucial in determining whether the stock can continue its upward momentum. For investors with a long-term perspective, the current market conditions and positive brokerage outlook may provide a compelling entry point for Reliance shares.
Conclusion: Positive Outlook for Reliance Industries
Reliance Industries has regained investor confidence, with brokerages raising their price targets to ₹1,400–₹1,600, reflecting optimism about the company’s growth prospects. While there are challenges ahead, the key growth catalysts identified by Macquarie, Morgan Stanley, and Kotak make Reliance a strong contender for future upside. For investors looking for a mix of stability and growth in India’s corporate sector, Reliance Industries remains a solid choice.
