Daijiworld Media Network - Mumbai
Mumbai, Jun 22: Shares of Reliance Industries Limited could see a re-rating from current levels if the company’s retail business witnesses a recovery, brokerage firm Jefferies said in a note on Monday.
According to Jefferies, Reliance Industries shares are currently trading nearly one standard deviation below their historical mean, offering potential upside. The brokerage has maintained a ‘Buy’ rating on the stock with a price target of Rs 1,675, indicating a possible upside of around 28 per cent from current levels.
Jefferies said accelerating investments in the company’s FMCG business could help Reliance achieve its revenue target of Rs 1 lakh crore by 2030. The brokerage also noted that the New Energy business is nearing monetisation, with solar module and energy storage system (ESS) production expected to begin during the current financial year.
Nomura maintains Rs 1,640 target
Nomura Holdings has also retained a ‘Buy’ rating on Reliance Industries with a price target of Rs 1,640, implying more than 25 per cent upside.
Nomura said artificial intelligence could become a new growth engine for the company as Reliance Intelligence moves from the planning stage towards execution, including the development of the Jamnagar AI hub.
The brokerage expects the New Energy business to generate its first revenue during the current financial year and highlighted the $3 billion green energy supply agreement with Samsung C&T Corporation as a positive factor for Reliance’s green molecule strategy.
CLSA sees further upside
CLSA has maintained an ‘Outperform’ rating on Reliance Industries with a price target of Rs 1,800, among the highest targets among brokerages.
The target suggests an upside potential of around 38 per cent from current levels.
CLSA said its valuation does not include potential value from Reliance’s AI initiatives, FMCG expansion, media business, new materials and export plans.
The company has also highlighted artificial intelligence as a key tool being integrated across its businesses.
Analysts largely bullish on RIL
Reliance Industries continues to remain a near-consensus ‘Buy’ among analysts tracking the stock. Out of 34 analysts, 33 have given a ‘Buy’ recommendation, while only one has a ‘Sell’ rating.
Shares of Reliance Industries closed 1.2 per cent lower at Rs 1,311.5 on Friday. The stock has declined around 17 per cent so far this year.