RELIANCE INDUSTRIES (RIL) SHARE PRICE TODAY

The share price of Reliance Industries is seen resolving above last three months base formation (₹2463-2180) signalling resumption of up move and offers fresh entry opportunity 

Stock has witnessed a steady rebound in the last two months from the key support area of ₹ 2200 being the previous major low of March 2022 and the entire up move is well channelled signalling sustained demand at elevated levels

In the smaller time frame the stock in the last 11 sessions has witnessed a shallow retracement of just 50% of its preceding 14 sessions up move and is currently witnessing buying demand after base above the 52 weeks EMA highlighting strength and positive price structure
 
We expect the stock to maintain positive bias and head towards ₹ 2710 levels in the coming months being the 80% retracement of the entire decline of Apr22-Mar23 (₹ 2856-2180)

Reliance Industries Ltd (RIL) is one of India’s largest conglomerate with a presence in oil refining & marketing, oil & gas exploration, petrochemicals, organised retail, media and digital services (Jio) making it a well diversified business entity. On a consolidated basis, at the EBITDA level in FY23, O2C and oil & gas contributed 50% while retail, digital and others contributed 12%, 34% and 4%, respectively

On the traditional businesses front, in FY23 O2C segment’s EBITDA grew 18% YoY to ₹62075 crore, profitability is expected to remain steady in near term. We expect GRMs to be subdued in the current quarter, but likely to increase in H2FY24 due to the anticipated rise in demand. Going forward, the company plans to invest more into petrochemicals business. Oil and Gas EBITDA grew 1.5x YoY to ₹13589 crore due to higher gas realisation. Going ahead, ramp up in gas production will drive growth in oil & gas segment.

FY23 was another landmark year for Reliance Retail as it grew 30% YoY to ₹ 2.6 lakh crore on a significantly large base. Retail coverage area now has crossed 65 million sq ft (up 57% YoY), which is more than 4.5x the size of the second largest retailer. Despite record number of store additions and foray into newer segments (consumer brands) the company managed to improve its RoCE profile by 250 bps YoY to 14.0% in FY23. Reliance Retail’s widespread physical store network would further enhance its omni-channel capabilities (~18% of revenues) and position it as a frontrunner to garner consistent business growth by capturing a larger pie of the Indian retail sector opportunity.

We believe that superior spectrum portfolio along with superior digital ecosystem offering lends Jio a competitive advantage even in 5G (as seen in 4G foray). With no tariff hike in sight, 5G users’ data usage trend will drive the ARPU in the near and medium term (~8.5% ARPU CAGR over FY23-25). It is aggressively expanding its broadband coverage (targeting 100 mn customer in two to three years vs. current base of ~9 mn) both through new plans and fixed wireless access, thereby aiming higher wallet share ahead. Jio also continues to build on enterprise use case both for large enterprises and small and medium businesses which will be a long-term growth catalyst.
 
We expect consolidated revenue to grow at 3% CAGR over FY23-25 to ₹1034222 crore, EBITDA to grow at ~10% CAGR over FY23-25 to ₹171724 crore and PAT to grow at 12% CAGR to ₹83608 crore, with a ROCE of 9.2% in FY25E. Long term prospects and dominant standing of Reliance Industries in each of its product & service portfolio provide comfort for long term value creation. RIL’s consumer business will be the growth driver, going ahead. The company has a strong balance sheet while its traditional business will continue to generate steady cash flows.

Refineries & Petroproducts company Reliance Industries announced consolidated Q4FY24 & FY24 results:

Q4FY24 Financial Highlights:

• Gross Revenue was Rs 2,64,834 crore (USD 31.8 billion), up 10.8% YoY.
• EBITDA increased by 14.3% YoY to Rs 47,150 crore (USD 5.7 billion).
• Jio Platforms (JPL) EBITDA increased 12.5% YoY.
• EBITDA for Reliance Retail Ventures (RRVL) increased sharply by 18.5% and a 60bps margin expansion to 8.6%.
• Oil and Gas segment EBITDA increased sharply by 47.5%.
• Depreciation increased by 18.5% YoY to Rs 13,569 crore (USD 1.6 billion) on expanded asset base across all the businesses.
• Finance Costs decreased by 1.0% YoY to Rs 5,761 crore (USD 691 million).
• Tax Expenses increased sharply YoY to Rs 6,577 crore (USD 789 million).
• Profit after tax improved marginally YoY to Rs 21,243 crore (USD 2.5 billion).
• Capital Expenditure for the quarter ended March 31, 2024, was Rs 23,207 crore (USD 2.8 billion).

FY24 Financial Highlights:

• Gross Revenue was Rs 10,00,122 crore (USD 119.9 billion), up 2.6% YoY.
• Revenue for JPL increased by 11.7% YoY.
• O2C revenue decreased by 5.0%.
• Revenue from Oil & Gas segment increased significantly by 48.0%.
• EBITDA increased by 16.1% YoY to Rs 1,78,677 crore (USD 21.4 billion).
• JPL EBITDA increased 12.8% YoY.
• RRVL EBITDA increased sharply by 28.5% YoY with margin expansion of 60 bps to 8.4%.
• O2C EBITDA increased marginally.
• Oil and Gas EBITDA increased sharply by 48.6%.
• Depreciation increased by 26.1% YoY to Rs 50,832 crore (USD 6.1 billion).
• Finance Costs increased by 18.1% YoY to Rs 23,118 crore (USD 2.8 billion).
• Tax Expenses increased by 26.2% YoY to Rs 25,707 crore (USD 3.1 billion).
• Profit after tax increased by 7.3% YoY to Rs 79,020 crore (USD 9.5 billion).
• Capital Expenditure for the year ended March 31, 2024, was Rs 1,31,769 crore (USD 15.8 billion).

Commenting on the results, Mukesh D. Ambani, Chairman and Managing Director, Reliance Industries Limited said, “Initiatives across RIL’s businesses have made a remarkable contribution towards fostering growth of various sectors of the Indian economy. It is heartening to note that alongside strengthening the national economy, all segments have posted a robust financial and operating performance. This has helped the Company achieve multiple milestones. I am happy to share that this year, Reliance became the first Indian company to cross the Rs 100,000-crore threshold in pre-tax profits.

Performance of the digital services segment has been boosted by accelerated expansion of subscriber base, supported by both mobility and fixed wireless services. With over 108 million True 5G customers, Jio truly leads the 5G transformation in India. From upgrading the hitherto 2G users to smartphones, to leading the effort of producing AI-driven solutions, Jio has proved its capability in strengthening the nation’s digital infrastructure.

Reliance Retail continued to provide customers endless choices through its robust omni-channel presence. We continue to offer product differentiation and superior offline experience through stores remodelling and revamping of layouts. Our digital commerce platforms also provide newer solutions to users with a broad brand catalogue. Reliance Retail also works towards strengthening millions of merchants through its unique initiatives in new commerce space.

Strong demand for fuels globally, and limited flexibility in refining system worldwide, supported margins and profitability of the O2C segment. Downstream chemical industry experienced increasingly challenging market conditions through the year. Despite headwinds, maintaining leading product positions and feedstock flexibility through our operating model that prioritises cost management, we delivered a resilient performance. The KG-D6 block has achieved 30 MMSCMD of production and now accounts for 30% of India’s domestic gas production.

We remain committed to our projects and initiatives, including those in the New Energy segment, which will bolster the company, and help it deliver sustainable growth for the future.”

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