'Add' Reliance Industries Shares Maintains Dolat Capital Post Q1 Results — Check Target Price

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Dolat Capital Report

Reliance Industries Ltd.’s Ebitda/adjusted PAT came -5%/-8% below our expectations due to weak performance by oil-to-chemical and oil and gas. However, the reported PAT boosted other income.

Key highlights include-

1. Weak O2C Ebitda QoQ, despite recovery ingross refining margin, supernormal marketing margins on motor spirit and high speed diesel and sourcing of cheap ethane;

2. Retail continued strong performance with store additions of 252 QoQ (highest in last eight quarter. Retail margin expansion is expected at the segment level;

3. FMCG demerger is pending for approvals. Once cleared, Reliance Retail shareholders will get stakes in the new FMCG company; and

4. On-track to commission gigafactories progressively over the next four-six quarters and postcommissioning, business to be self-funded by partnering with the right players for offtake and financing.

We tweak our FY26E/FY27E earnings by +1.4%/+0.9%, considering healthy GRM and higher other income.

Maintain ‘Accumulate’ rating with upward revision in SoTP-based target price of Rs 1,625 (vs Rs 1,565 earlier). Value discovery in "New Energy" Biz could be a positive trigger for the stock.

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