On Friday, Reliance Industries’ stock went up by almost 5%, marking its best week in six months. This increase happened after the company reported better-than-expected profits, mainly thanks to its retail business, which had been struggling lately. Reliance, which is the most valuable company in India and a big player on the Nifty 50 stock index, was trading 2.2% higher and has gained 3.4% this week.
While the Nifty index dropped 0.9% today and is down 1.4% for the week, Morgan Stanley shared positive news, mentioning that “Reliance is back on a growth path,” and that the risk of lower earnings has decreased.
On Thursday, Reliance shared that its net profit grew by 7.4% to ₹18,540 crore in the third quarter, boosted by festive shopping in its retail segment and increased usage of 5G in its telecom services. After the results were released, at least six financial firms upgraded their ratings to “buy” on Reliance shares, and four raised their price targets.
J.P. Morgan analysts noted that Reliance’s strong retail performance will likely help the stock in the short term, reversing its recent dip. The stock had dropped around 6% in 2024, the first annual decline in ten years, mainly due to worries about lower refining profits and slow growth in retail.
Citi analysts were also encouraged by Reliance’s strong retail performance, saying that the previous slowdown in this area has affected the stock’s performance and investor feelings, which they believe will now improve.
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