The brokerage emphasized two important reasons to support his opinion: the implicit discount of the holding has only been marginal reduced until 2025, and RIL’s retail arm continues to act with a higher discount compared to Dmart.
According to JP Morgan, Ril’s implicit holding company will be increased by the EV/EBITDA -Veevouden by Bharti and Dmart, measured on Jio and Retail, measured. The brokerage noted that even after strong performance by these colleagues the implicit discount of Ril has only fallen slightly until 2025, making the conglomerate on this basis relatively cheap.
The second factor that JP Morgan emphasized was the implicit EV/EBITDA -Meerfold of Reliance Retail, which continues to act with a higher discount compared to Dmart. With the help of standard multiples and the exclusion of other valuation components of the sum-of-the-parts, JP Morgan noted that the retail rating of RIL still seems favorable to his sector fields.
In addition to valuation statistics, the brokerage sketched various potential stock drivers. The refining margins have been improved, with diesel and gasoline cracks that are higher, while the total Petrochemical gross margins of RIL have also increased in the short term.
An expected increase in Telecom’s rates could further support the growth for JIO, although JP Morgan warned that this impact would only be more meaningful from December 2025 to March 2026. On the retail side, the company pointed to potential catalysters of the upcoming festive demand, which could stimulate a high dual growth of dual -confidence. In general, JP Morgan predicts that RIL could deliver an EPS CAGR of 27%, supported by a limited disadvantage of its oil-to-chemicals (O2C) business and upward potential in the retail trade. In the conditions of capital expenditure, JP Morgan RILs emphasized Total Capex of RS 1.3 trillion in FY25, of which RS was 337 billion alloced to the retail segment. Reliance Retail Only RS reported 158 billion in Capex, RRVL RS 18 billion and Reliance Brands RS 44 billion. Other companies and non -decent segments were good for RS 312 billion, with a large part focused on new energy projects, including solar PV, batteries and electric mobility. Even if this support does not return, the stable EBITDA growth and consistent Capex can keep under control in the medium term.
JP Morgan also noted that Ril’s FY26E PAT is expected to increase by 11%, after taking into account an exceptional profit in Q1.
The brokerage concluded that RIL shares with comfortable relative valuations and favorable sectoral trends remain well positioned from a valuation perspective.
With this display, JP Morgan has assigned a ‘considered’ rating on the shares with a target price of RS 1,695.
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(Disclaimer: recommendations, suggestions, views and opinions of the experts are their own. These do not represent the views of economic times)
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