Strong Performance Drives Reliance Industries Stock Surge
Reliance Industries Ltd (RIL) shares witnessed a significant rise on April 28, 2025, after the company posted better-than-expected earnings for the fiscal quarter ending March 31, 2025. The shares jumped over 5%, making it the top gainer on the Nifty 50 index, closing at Rs 1,336.30 apiece. This marked RIL’s largest single-day gain since June 3, 2024.
The company’s net profit for Q4 FY25 rose 2.4% year-on-year, totaling Rs 19,407 crore, driven by lower depreciation, interest, and tax rates. Revenue for the quarter also grew 8.8% from the previous year to Rs 2.88 lakh crore, boosted by strong performances across its digital services, retail, and oil-to-chemicals (O2C) businesses.
Highlights:
Reliance Industries’ stock rose 5.07% to close at Rs 1,336.30 on April 28.
The company reported a 2.4% increase in Q4 FY25 net profit to Rs 19,407 crore.
Revenue increased 8.8% year-on-year to Rs 2.88 lakh crore.
Biggest single-day gain since June 3, 2024.
Robust Business Segments Fuel Earnings Growth
Reliance Industries’ growth was largely driven by the impressive performance of its core business segments: digital services, retail, and the oil-to-chemicals (O2C) division. These key drivers helped the company exceed earnings expectations, prompting brokerages to raise their target prices for the stock.
Brokerages have praised RIL’s robust performance, particularly in the O2C segment, which outperformed market expectations. The strong quarterly results have led to increased confidence in RIL’s ability to deliver consistent growth across its diversified portfolio.
Highlights:
Strong performance from the digital, retail, and O2C businesses.
O2C segment’s results were better than anticipated, further boosting stock performance.
Brokerage Optimism and Target Price Hikes
Following RIL’s Q4 results, several brokerages have raised their target prices for the stock, citing strong growth prospects in the company’s key segments. Domestic brokerage Motilal Oswal expects Reliance Jio to drive the most growth, forecasting a 21% annual EBITDA growth over FY25-27, fueled by potential tariff hikes, market share gains in wireless, and expansion of the homes and enterprise business.
Global brokerage Nomura Holdings identified multiple growth drivers for RIL, including the scale-up of the new energy business, the upcoming tariff hikes for Jio, and the potential listing of Jio, which could unlock significant value for RIL. Additionally, with the completion of Reliance Retail’s operational streamlining, the retail business is expected to sustain a healthy growth trajectory.
Highlights:
Brokerages have raised target prices on RIL, citing strong performance and growth prospects.
Reliance Jio seen as the biggest growth driver, with a forecasted 21% annual EBITDA growth.
Nomura highlights growth from new energy business and Jio IPO potential.
Positive Outlook for Reliance Retail and New Energy
JPMorgan noted the sharp acceleration in Reliance Retail’s growth, which jumped 16% year-on-year in Q4 FY25. The brokerage believes the favorable valuations for Reliance Retail could contribute positively to RIL’s stock price in the near term.
On the new energy front, Nuvama Institutional Equities highlighted the potential for the new energy segment to account for 12% of RIL’s profit by FY2030. The segment’s growth aligns with the company’s plans to position new energy as a major contributor to its consolidated net profit in the long term. This shift is expected to significantly impact the company’s valuation, especially as ‘clean’ technologies gain importance.
Highlights:
JPMorgan projects continued growth for Reliance Retail, with a 16% year-on-year jump.
Nuvama sees new energy contributing significantly to RIL’s future profits.
New energy is expected to account for 12% of profit by FY2030, with a strong long-term growth outlook.
Future Growth Prospects and Brokerage Forecasts
Motilal Oswal projects a compound annual growth rate (CAGR) of 13-14% in consolidated EBITDA and PAT for RIL over FY25-27. This growth is expected to be driven by a double-digit EBITDA growth in Reliance Jio and Retail. Despite a subdued FY25, Motilal Oswal anticipates a recovery in the O2C segment, with improved refining margins contributing to future earnings growth.
Highlights:
Motilal Oswal forecasts a 13-14% CAGR in consolidated EBITDA and PAT over FY25-27.
Growth driven by a strong performance from Reliance Jio and Retail, with a recovery in the O2C segment.
