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Dolat Capital Report
Reliance Industries Ltd.'s Ebitda up 15% YoY but down 1% QoQ to Rs 406 billion (in line with estimates), strong performance in upstream and retail segment was offset by a relatively muted telecom average revenue per user.
Weak show by oil-to-chemical on planned maintenance shutdown and weak margin environment.
Profit after tax up 9% YoY but down 1% QoQ to Rs 173 billion (2% above estimates).
Moderation in capex (-20% YoY and -22% QoQ), decline in capex is expected as the completion of 5G rollouts. Net Debt is marginally higher with pay down of other liabilities related to capex. Net debt/Ebitda lower than one time.
We forecast RIL Ebitda/PAT compound annual growth rate of 12%/16% during FY24E-FY26E with Jio contributing 55% share on the back of a tariff hike and retail contributing 25% on operating leverage and improved throughput.
We have increased the earnings of FY25E/FY26E but we maintain 'Accumulate' on RIL. Thus, we have raised up SoTP-based target price to Rs 3,010 (earlier Rs 2,730) based on March 2026 estimates.
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