Reliance shares set for best day since January 2024 after strong quarterly report

what happened

Shares of Reliance Industries climbed 6% on Monday. Support came from strong results in its oil-to-chemicals unit, O2C, and steady growth at the Jio telecom business, which outweighed weakness in retail. According to Reuters, the stock traded at 1,232.50 rupees as of 9:34 a.m. IST and could post its best day since January 2024. Reliance was the top gainer in the Nifty 50, which rose 0.97%.

Net profit for the September quarter jumped 40.6% to 255.48 billion rupees ($2.69 billion), above analysts' estimate of 214.19 billion rupees. Stronger refining and petrochemical margins drove the result. Analysts said the company's earnings growth is gathering pace, with energy and telecom strength more than offsetting pressure in retail.

Jefferies described the O2C performance as excellent and raised its earnings forecasts. Emkay Global also lifted its estimates and said the stock's valuation remains attractive. Retail was the weaker part of the business, held back by quick commerce investments, store closures and cost pressures. The company still plans to expand JioMart and its dark-store network.

why it matters

The key point for markets is that refining and petrochemicals, not one-off items, drove the profit growth. Reliance carries a large weight in the Nifty 50, so its moves can noticeably shape the whole Indian equity market.

market impact

Reliance shares and Nifty 50: the earnings beat and O2C recovery support the stock and the index

• ▲Reliance shares pressure up — quarterly profit above forecasts and a recovery in O2C refining earnings
• ▲Nifty 50 pressure up — Reliance's large index weight contributed most of the gain

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