Reliance Industries’ stock has been on the rise following several upgrades and positive calls from brokerages. On Friday, the stock saw a 3 per cent increase after global brokerage Macquarie upgraded its rating on the stock to outperform from neutral.
Macquarie is optimistic about Reliance’s potential to improve its earnings CAGR to 15-16 per cent over FY25-27. The brokerage raised its target price for the stock from ₹1,300 to ₹1,500, representing a 24 per cent upside potential from the previous close.
Moreover, Kotak Institutional Equities upgraded its rating from add to buy with a target price of ₹1,400, while Jefferies reiterated a buy rating with a target price of ₹1,600.
Kotak analysts mentioned that subdued retail performance was a key factor for the weak overall performance, but they anticipate that the store-rationalisation cycle will come to an end soon.
Regarding Reliance Jio, Kotak remains positive on the long-term prospects. The brokerage noted that the delay in tariff hikes may reduce ARPU by 2 per cent for FY26 estimates, but this could be offset by the faster pace of broadband subscriber additions due to the accelerated rollout of Jio AirFiber.
Jefferies highlighted the growth potential in the retail business and the possibility of a tariff hike in the telecom segment.
Kotak believes that the retail business will see improvement in the coming quarters. The brokerage also pointed out that news surrounding the telecom business IPO timelines and the potential for another tariff hike could act as catalysts for the stock. Despite a 1-3 per cent cut in EBITDA estimates for FY24-27, Kotak expects an earnings CAGR of over 11 per cent.
The stock surged 3.01 per cent on the BSE to trade at ₹1,247 as of 11.05 am, reaching an intraday high of ₹1,247.40. It has climbed 7 per cent from its 52-week low of ₹1156.
The above-mentioned upgrades and bullish calls from brokerages have contributed to the recent momentum in Reliance Industries’ stock.
