Why Reliance Industries Is the “Buy Now” Stock with ~18% Upside – According to JP Morgan & More.

Why Reliance Industries Is the “Buy Now” Stock with ~18% Upside – According to JP Morgan & More

A rally in global brokerage sentiment has shone fresh spotlight on Reliance Industries Limited (RIL). JP Morgan recently raised its price target from ₹1,568 to ₹1,695—signaling an upside potential of around 18% from current levels.

What’s Behind the Enthusiasm?

JP Morgan highlights several growth drivers:

– Telecom margin expansion: Jio posted a 124 bps improvement quarter-over-quarter—boosting confidence in its telecom business.
– New Energy momentum: The fast-evolving green energy arm is finally taking shape. JP Morgan sees clarity ahead as capex gets deployed .

– Retail slowdown tempered: Yes, retail growth decelerated to ~11%, and Oil‑to‑Chemicals (O2C) EBITDA underperformed. But brokerages view it as a short-term issue.

Morgan Stanley and HSBC also chimed in, with target prices of ₹1,617 (+12%) and ₹1,630 (+13%) respectively.

The Broader Brokerage Backing

This bullish wave comes amid a broader vote of confidence:

• RIL shares are up ~19% year-to-date, outperforming the Nifty 50’s ~5–6% gain.

• Median analyst price target: ₹1,640—implying ~15% upside from current trading levels around ₹1,423–₹1,440.

• Several brokerages (Axis Capital, BNP Paribas, Goldman Sachs, etc.) have targets north of ₹1,700; top bull Nuvama projects ₹1,767.

Can RIL Keep Grinding?

Q1 results sparked mixed reactions:

• Q1 net profit surged ~78%—thanks partly to a one-off stake sale in Asian Paints.

• But O2C and retail segments missed expectations; Jamnagar refinery shutdowns and softer electronics retail weighed.

• Not all gloom: analysts anticipate margin recovery in O2C and continued strength from Jio and retail.

Long-Term Growth Narrative

• Double earnings by 2029 is Management’s stated ambition—JP Morgan and Morgan Stanley believe this is achievable.

• Retail, telecom, and new energy are expected to be the main profit engines from FY26‑27 onwards.

• Free cash flow will improve with telecom capex tapering, freeing up funds for new energy & petrochemical expansion.

Key Takeaways

Element	Insight
Near-Term Challenges	O2C and retail segments under pressure; share price dipped ~3–4% to ~₹1,423 after results
Brokerage Upsides	Price targets range ₹1,617–₹1,767; median upside ~15–18%
Growth Drivers	Telecom margin recovery, New Energy rollout, retail rebound, and O2C resurgence
Strategy	Long-term investors may see this as a strong entry point, while traders could ride short-term volatility

Bottom Line

Despite a modest profit dip in key segments, Reliance Industries continues to attract robust institutional confidence. With telecom margins improving, new energy initiatives taking off, and retail/energy expected to bounce back, many see the current dip (~₹1,423–₹1,440) as a strategic opportunity. With median brokerage targets pointing to 15–18% gains, the stock seems positioned for a solid run-up—though near-term bumps are likely.