The growth dynamics for Reliance Industries are changing. The oil-to-chemicals major is now seeing a definitive shift in trend in terms of the drivers that could propel growth going forward. Key brokerage houses have highlighted that consumer business growth is likely to translate into a better bottom line, helping Reliance Industries’ profitability in the upcoming quarters.
According to JPMorgan, Bernstein, and Jefferies, telecom and retail remain the bright spots. Aggressive expansion plans in these two segments are expected to push margins forward. They expect that the next two years are set to be better than the last two, powered by retail and telecom.
JPMorgan on RIL: Telecom tariff increase to be key
JPMorgan has projected that Reliance Jio is set to see a significant earnings boost in case of a tariff hike in the second half of FY26.
The brokerage estimates that if tariffs rise by 20 per cent in the second half of FY26, Reliance’s profit after tax (PAT) in FY27 could touch Rs 82,300 crore, about 5 per cent more than the base case of Rs 78,600 crore (assuming an 11 per cent hike).
Similarly, RIL’s sum-of-the-parts (SoTP) valuation also improves with higher tariffs, moving from Rs 1,511 per share at 0 per cent hike to Rs 1,614 per share at a 20 per cent hike.
If there is no hike, profits could fall to Rs 74,000 crore 6 per cent below the base estimate. The company’s valuation would also benefit from higher tariffs, potentially rising from Rs 1,511 per share to Rs 1,614 per share.
Bernstein on RIL: Focus on Telecom tariff repair, same-store rationalisation
Bernstein noted that Reliance Retail has completed a major round of store rationalisation in FY2025, closing around 2,100 underperforming outlets. With that phase largely over, the company is now focusing on quality expansion. Bernstein expects Reliance Retail to grow its revenue and EBITDA at a compound annual growth rate (CAGR) of 16 per cent and 20 per cent, respectively, between FY25 and FY27.
In telecom, Bernstein anticipates a 13 per cent revenue growth annually on a compounded basis for Jio over the next two years, driven by tariff hikes and the growing rollout of Jio AirFiber. As Jio expands its subscriber base towards 500 million and nears a 48 per cent market share in revenue, it is likely to gain further strength.
“Telecom will remain the bright spot as ARPU hikes reflect in earnings with capex continuing its downward trend,” Bernstein said in its report.
Jefferies on RIL: Retail focus back on growth, Jio to support valuation
Jefferies too reiterated a positive outlook for Reliance Industries, stating, “Visibility on FY26 growth is improving with acceleration in retail, 23% EBITDA growth in Jio, and near-term strength in O2C.”
Jefferies highlighted that Reliance Retail resumed healthy mid-teen growth in Q4 FY25, driven by Same-Store Sales Growth (SSG) improvement. After a year-on-year decline in FY25, the management has indicated plans to expand floor space from FY26 onwards. Meanwhile, its entry into the quick commerce segment is gaining momentum, with deliveries under 30 minutes and substantial expansion plans in the pipeline.
Jefferies also projected that Reliance Jio will see a significant earnings boost if there is a tariff hike in the second half of FY26. It added that the segment is expected to deliver compound annual growth rates (CAGR) of 18 per cent in revenues and 21 per cent in EBITDA between FY25 and FY27.
“We believe telecom is the best way to play consumption in India, due to which valuations also have scope to re-rate,” Jefferies added in its report.