Reliance Industries Limited (RIL) is expected to witness a rebound in earnings growth in the financial year 2026 (FY26), potentially narrowing its net asset value (NAV) discount, according to analysts. The stock remains a ‘Buy’ with a 12-month price target of ₹1,640, indicating a 28.3% upside from its current price of ₹1,278.40.
Retail and Jio Revenue in Focus
RIL’s core EBITDA is projected to remain largely stable quarter-on-quarter. However, market attention will be on two key factors: the retail segment’s growth trends and the impact of residual tariff hikes on Jio’s revenue. Analysts estimate retail revenue (excluding connectivity) to grow by 6.5% year-on-year in the fourth quarter, while Jio’s revenue is expected to rise 4% quarter-on-quarter, outpacing rival Bharti Airtel.
Additionally, investors await updates on RIL’s retail growth guidance for FY26 and progress on its new energy initiatives. The company had earlier committed to commencing solar module production by the end of 2024 and ramping up battery production to 30GWh by the second half of 2025.
NAV Discount Expected to Narrow
While RIL’s NAV discount has improved moderately, it remains wider than historical levels due to subdued EBITDA in FY25 and earnings downgrades. The slowdown in retail growth and weak refining and chemical margins have weighed on valuations.
However, analysts anticipate an 18% earnings growth in FY26, driven by a 12% rebound in retail EBITDA, a 24% rise in Jio’s earnings following a potential tariff hike, and an improvement in refining margins. With the stock trading near one standard deviation below its historical mean, analysts see a favorable risk-reward scenario, maintaining their ‘Buy’ recommendation.
