Jefferies has increased its 12‑month price target for Reliance Industries (RIL) to Rs 1,830 per share, seeing about a 21% upside from today’s price. The brokerage says a rise in Jio’s mobile tariffs and a possible Jio IPO later in 2026 could lift the whole group’s value.
Target price upgrade
The analyst house kept its “Buy” call on RIL and pushed the target up from the previous level. The new target is based on a sum‑of‑the‑parts valuation that looks ahead to March 2027.
Why a Jio tariff hike matters
- Jefferies expects Jio’s revenue to grow 22% year‑on‑year in FY27.
- It assumes a 15% increase in mobile tariffs around June 2026, which would boost EBITDA by about 28%.
- Strong broadband and fixed‑wireless access (FWA) growth will also help.
Potential Jio IPO as a catalyst
The brokerage sees a Jio Platforms listing in the first half of 2026 as a key event. Using a 15× EV/EBITDA multiple for FY27‑28, Jefferies values Jio’s stand‑alone equity at roughly $170 billion.
Retail, FMCG and new‑energy outlook
- Reliance Retail could see revenue rise about 16% in FY27 as new stores open and sales per square foot improve.
- Margins may soften a bit because of a larger share of lower‑margin grocery and JioMart sales.
- The fast‑growing FMCG arm, now generating about $2.4 billion in annual revenue, is expected to add further value.
- New‑energy projects and data‑centre plans are also highlighted as medium‑term growth drivers.
Oil‑to‑chemicals (O2C) segment
Jefferies forecasts modest 5% EBITDA growth for the O2C business in FY27. Refining margins are projected to stay flat year‑on‑year, with higher Singapore margins offsetting pressure from petrochemical overcapacity.
Risks to watch
- Jio’s tariff hike could be smaller than expected or subscriber growth may slow.
- Refining and petrochemical margins could fall if China’s economic recovery falters.
- Higher cash burn in e‑commerce could pressure valuations for consumer businesses.
Remember, this is my perspective, not a prediction. Do your own research before making any investment decisions.