RIL stock may take a hit after muted Q4 show

Weak 02C performance drives analysts to cut target price, earnings estimates even as valuation helps retain ‘buy’ ratings

- RAM PRASAD SAHU

Weighed down by multiple headwinds facing its energy business, the March quarter results of the country’s most valued company missed brokerage expectations.

Production volumes and realisations at Reliance Industries Limited’s (RIL) oil-to-chemicals (02C) as well as exploration segments hit multi-quarter lows.

Given that the two account for just under 40 per cent of segment operating profits, a 4-18 per cent year-on-year (Yo-Y) fall in the two led to a flattish consolidated operating performance. The disruption due to the Iran war negated the robust growth in the consumer businesses of telecom and retail Yo-Y.

While the key triggers remain the listing of its telecom venture Jio and the progress in new energy business —especially solar — the stock could face pressure in the near term, given the fourth quarter (Q4FY26) disappointment and pressure on 02C segment. Though some brokerages have cut their earnings estimates and target prices, they have maintained a ‘buy’ rating on the stock. This is on account of valuations and the correction/underperformance of the stock over the past month, as compared to the benchmark Nifty 50.