The brokerage wrote in its note that the year-on-year rise in free cash flow (FCF) and operating cash flow (OPCF) was largely supported by a sharp $5 billion increase in advances from oil & gas customers.
CLSA also pointed out that operating expenditure (opex) and interest cost capitalisation together accounted for around 33% of RIL’s reported consolidated profit before tax (PBT).According to CLSA, this high level of capitalisation could reduce the company’s operating leverage in the coming years.
On the strategic side, CLSA mentioned that Reliance’s AI initiatives through Jio, the expansion of its media and consumer businesses, and the integration of new energy value chains were highlighted in the company’s annual report as key long-term growth drivers.Looking ahead, CLSA said it will closely monitor potential announcements at next week’s Annual General Meeting (AGM) on August 29, particularly any updates on a possible Jio IPO, greater clarity on AI-related plans, and progress on FMCG expansion.
A day earlier, JPMorgan reiterated its ‘Overweight’ rating on the stock, with a price target of ₹1,695. It said that RIL’s relative valuations continue to look reasonable despite its year-to-date outperformance.
JPMorgan added that stronger O2C margins, potential tariff hikes, and improved retail growth could act as key positives for the company.
Of the 36 analysts that have coverage on RIL, 33 have a ‘Buy’ recommendation, and one say ‘Hold’.
Shares of Reliance Industries are now trading flat at ₹1,420.80. The stock has risen over 16% so far in 2025.
