3 Brokerage Houses Place A "Buy" & "Add" Call On The RIL Stock

Stock's CMP, 52-Week Low/High, Returns, & Target Prices by Brokerage Firm

On NSE, the stock last traded at Rs 2,430.30/share, down 0.51% from the previous close. The stock recorded its 52 week high at Rs 2,856.15/share and 52 week low at Rs 2,180/share, respectively. In a week, its share price moved down 0.56%. In the past 1 year, it fell by 1.92%. The stock gave 59.17% positive returns in 3 years and 147.17% in 5 years, respectively.

• Motilal Oswal has placed a "Buy" on the stock with Rs 2800/share target price, claiming 16% potential upside from its current level.
• ICICI Direct has placed "Buy" on the stock with a target price of Rs 3,050/share, claiming 26% potential Upside.
• ICICI Securities Reiterate "ADD" on the stock with Rs 2,802/share target price, sees 16% upside from its current level.

Motilal Oswal's Views

The brokerage said, "We have rolled over our SOTP valuation base to Dec'24. We value the Refining and Petrochemical segment at an EV/EBITDA of 7.5x, arriving at a valuation of INR879/share for the Standalone business. We ascribe an equity valuation of INR809/share to RJio and INR1,270/share to Reliance Retail, factoring in the recent stake sale. Our higher EV/EBITDA multiples of 35x for Retail and 15x for Digital Services underscore new growth opportunities in the Digital space and steady market share gains. We reiterate our BUY rating on the stock with an SoTP-based TP of INR2,800."

ICICI Direct's Views

According to brokerage, RIL's consumer business will be the growth driver, going ahead. Tariff hikes undertaken by Jio would be a key monitorable. O2C segment is likely to improve as higher middle distillate cracks would help strengthen GRMs along with a rebound in petchem demand. "We maintain our BUY rating on the stock. We value RIL at Rs 3050 on an SoTP basis," the brokerage has said.

ICICI Securities' Views

According to the brokerage, Reliance Industries (RIL) has reported a strong Q3FY23 with 19% YoY jump in consolidated EBITDA and a smaller 1% YoY jump in net earnings (QoQ EBITDA up 13%, PAT up 15%). Stronger performance of the OTC (oil to chemicals) segment, coupled with sustained momentum from retail and upstream helped earnings. Benchmark (SG) GRMs dipped by US$2.4/bbl to US$5.9/bbl, but key product spreads for RIL like gasoline, diesel and ATF remained strong, offset by a US$150/100 per ton YoY/QoQ reduction in integrated petchem spreads. OTC earnings also saw a ~US$2/bbl hit (Rs19bn) in refining from the special excise duty or 'windfall tax'. Upstream was strong with gas output at ~19mmscmd in Q3 and 91% YoY jump in EBITDA helped by stronger realisations. Prospects for Q4 can further improve for the OTC business, helped by higher Russian crude and steady product spreads while retail and RJio will likely continue to show growth. "However, we remain sceptical of any meaningful expansion in return ratios and/or any major move to return cash to shareholders in view of the sustained capex momentum over FY22-FY24E. Reiterate ADD with a revised SoTP-based target price of Rs2,802/sh," the brokerage has said.

Disclaimer

The stock has been picked from the brokerage reports. Greynium Information Technologies, the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to consult with certified experts before making any investment decision.