Reliance Industries Ltd surpassed market expectations in the fiscal fourth quarter, posting a net profit of Rs 21,243 crore, fueled by a rebound in its core oil-to-chemicals (O2C) business. Strong performances in the O2C, oil & gas, retail, and Jio segments also impressed analysts.

Moreover, the reduction in RIL’s net debt resulting from capital raises and asset divestitures has boosted investors’ confidence, positioning the company favorably with steady earnings and positive free cash flow. Analysts said that RIL’s new energy rollout will help unleash its next phase of growth.

Following RIL’s earnings report, Morgan Stanley maintained its ‘overweight’ rating on the stock with a target price of Rs 3,046 on multiple catalysts for re-rating across businesses.

RIL achieved a consolidated EBITDA of Rs 42,500 crore in Q4, up 14.3 percent from a year earlier, surpassing market expectations, driven by strong performance in E&P and O2C segments.

Additionally, the company reported a net debt of $14 billion as of March 31, reflecting an 8 percent decline from a year earlier, which Bernstein termed positive.

Reliance Jio exceeded expectations with higher ARPU driven by an improved subscriber mix. The profitability of the O2C segment saw a rise, primarily due to robust refining. The company demonstrated sustained growth momentum across key business verticals, Bernstein noted, as it put an ‘Outperform’ rating on the stock with a target price of Rs 3,160.

According to Nuvama Institutional Equities, RIL’s strength lies in its ability to build businesses on a global scale and execute complex, time-critical, and capital-intensive projects. “These strengths shall prove advantageous as the company embarks on large investments in all segments,” it said.

The domestic brokerage is now ascribing a rich valuation to Jio and Retail seeing their huge potential while remaining positive on the core O2C business (both refining and chemicals).

"We believe refining margins in Asia would rise due to a ‘paradigm shift in regional refining dynamics’ from West to East, which are favorable for a complex refiner like Reliance. RIL is almost done with its capex cycle, investing in world-scale projects such as pet coke gasification, off-gas crackers, and telecoms, which are expected to drive future growth in months to come,” Nuvama said as it maintained a ‘buy’ rating on the stock with a raised target price of Rs 3,500.

Emkay Global is also bullish on RIL. The brokerage assigned an ‘add’ rating on the stock with a revised target price of Rs 3,200. Given the competitive landscape, Emkay is positive on Jio tariff hikes, while oil and gas and retail are expected to remain steady.

The brokerage raised its FY25-26 earnings estimates by 2-5 percent each and raised the target price by 8 percent on the back of higher profitability in Jio and roll-over to March 2026.

RIL seems to have passed the peak capex phase, leading to an improvement in free cash flow, noted Jefferies as it maintained a ‘buy’ rating on the stock and raised the target price to Rs 3,380 per share.