Stock Market Today: Reliance share price declined around 3% in morning trades on Monday, post Q1 results that were declared on Friday post market hours. Reliance Industries reported net profit at consolidated levels at ₹17,445 crore declined slightly more than 4% y-oy though came in line with the consensus analyst estimates. The decline in earnings was expected due to weakness in Oil to chemical segment. Here is what analysts say
Jefferies with positive ratings watchful on Retail segment
Jefferies India Ltd who has maintained Buy ratings on Reliance Industries share price however have cut their target price slightly to ₹3525 ( ₹3580 earlier) as they tweaked their earnings before interest tax depreciation and amortizations (Ebitda) estimates. However their target price still indicates 14% upside from current levels of close to ₹3,079.50. Jefferies is watchful on pick up of growth in the retail segment
Consolidated Earnings before interest tax depreciation and amortizations (Ebitda) at close to ₹38,800 crore as per Jefferies calculations declined 9% sequentially but was in line with their estimates. Oil to Chemicals (O2C) and telecom arm Jio were in line with their expectations however Retail net profit was 4% below their estimates on higher tax rate and higher net interest expense.
Antique says weak O2C and Retail led to a miss
Analysts at Antique Stock Broking said that earnings were short of estimates due to weak O2C and retail. Reliance 1QFY25 Ebitda of around ₹38800 crore was lower than their estimates of ₹40200 Crore and consensus estimate of ₹39800 Crore. The decline was largely expected, primarily driven by weak O2C earnings due to weaker cracks however Retail was net profit was lower than their expectations.
Antique has cut their our FY25 Ebitda estimate by 5% mainly led by weakness in O2C earnings while keep their FY26 and FY27 estimates largely unchanged. Their target price for Reliance Industries stock also gets reduced to ₹3268.
Motilal Oswal expects Jio IPO to unlock valuation
Motilal Oswal Financial Services with Buy ratings on Reliance share price, said that structurally, they are bullish on the refining business given globally capacity growth lagging oil demand growth . In telecom, they are modeling an Average revenues per user (ARPU) CAGR (compound annual growth rate )of 12% over FY24-26. In addition, they see the potential IPO for RJio to unlock valuation for the telecom business. They remain positive on the retail business, where they are expecting 19% revenue and Ebitda CAGR each over FY24-26. Their target price of ₹3409 for Reliance share price indicates more than 10% upside
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions
