Reliance Industries Target Hiked to ₹1,830 by Jefferies

Introduction

Global brokerage Jefferies has reaffirmed its confidence in Reliance Industries Ltd (RIL), raising its 12-month price target to ₹1,830 per share despite a recent market downturn. The revised target implies a significant 21% upside from the previous closing price of ₹1,507. This bullish outlook comes just a day after RIL's shares experienced a 4.4% decline, which erased ₹94,000 crore from its market capitalization. Jefferies identifies the potential initial public offering (IPO) of Jio Platforms and an anticipated mobile tariff hike as the primary catalysts that could drive the conglomerate's next phase of growth and re-rating.

Upgraded Target and Valuation Rationale

Jefferies has maintained its 'Buy' rating on the Nifty blue-chip stock while lifting the price target from a previous ₹1,785. The brokerage's valuation has been rolled forward to March 2027, using a sum-of-the-parts (SOTP) methodology. This approach assesses the value of each of RIL's business segments individually to arrive at a total valuation for the conglomerate. The base-case scenario assumes robust growth across all key verticals between the fiscal years 2025 and 2028, reflecting strong underlying business momentum.

Jio: The Primary Growth Engine

The telecom and digital services arm, Reliance Jio, is positioned as the main driver of incremental earnings. Jefferies projects a 22% year-on-year (YoY) revenue growth and a 28% EBITDA growth for Jio in fiscal year 2027. This forecast is underpinned by two pivotal events. First, a 15% mobile tariff hike is expected around June 2026. Second, the report flags the imminent listing of Jio Platforms Ltd in the first half of the 2026 calendar year as a major value-unlocking event. Based on a 15x EV/EBITDA multiple for March 2027, Jefferies pegs Jio's standalone equity value at approximately $170 billion.

Retail and FMCG Segments Show Strength

Reliance Retail is also expected to contribute significantly to growth, with a projected revenue increase of 16% in FY27. This growth is anticipated to come from an acceleration in store additions following a period of network optimization and a return to double-digit growth in revenue per square foot. However, the EBITDA margin may see a slight moderation due to an increasing share of lower-margin grocery and JioMart sales in the overall mix. Furthermore, the fast-growing FMCG business, which includes brands like Campa Cola and Independence, is highlighted as a medium-term value discovery story. It is currently operating at an impressive annualized revenue run-rate of around $1.4 billion.

Stable Outlook for Oil-to-Chemicals

In the traditional oil-to-chemicals (O2C) segment, Jefferies forecasts a more modest 5% EBITDA growth in FY27. The stability in this segment is expected to be supported by firm Singapore gross refining margins and tight markets for refined products. These factors are likely to offset the persistent pressure from overcapacity in the petrochemicals sector. The brokerage anticipates RIL's gross refining margin to remain largely flat year-on-year, with the upside capped by a shift away from discounted Russian crude and a slow recovery in petrochemical spreads from 15-year lows.

Key Financial Projections

Jefferies' report provides a detailed breakdown of its growth expectations across RIL's core businesses. The long-term outlook remains positive, driven by the high-growth consumer-facing ventures.

Market Sentiment and Analyst Consensus

The positive stance from Jefferies aligns with a broader optimistic consensus among market analysts. Other major brokerages like JP Morgan and UBS have also maintained positive ratings on RIL, citing catalysts such as the Jio IPO, tariff hikes, and a recovery in the refining business. The stock has already outperformed the Nifty 50 index significantly year-to-date, and this report reinforces the view that multiple triggers are in place for continued momentum through 2026.

Conclusion

Jefferies' upgraded target price for Reliance Industries underscores a strong belief in the conglomerate's future, particularly the value-unlocking potential of its digital and retail businesses. While the O2C segment provides stability, the high-growth consumer ventures are expected to be the primary drivers of shareholder value. Investors will now be closely watching for official announcements regarding the Jio IPO and the anticipated tariff hikes, which are positioned as the next major milestones for the company.