Reliance Share Price Target Raised To Rs 1,600 By Emkay Despite Q1 Miss - Here’s Why

Emkay Global has reiterated its ‘BUY’ rating on Reliance Industries Ltd (RIL), raising the target price to Rs 1,600 from Rs 1,450, even as the conglomerate reported a weaker-than-expected performance in Q1FY26.

The upward revision is underpinned by positive management commentary, robust outlook across segments, and optimism around upcoming tariff hikes and energy transition initiatives.

Q1FY26 Performance: EBITDA and Profit Miss Expectations
According to Emkay’s report, Reliance reported a 5% miss in consolidated EBITDA at $429 billion and a 7% miss in APAT at $181 billion for the quarter ended June 2025. This was mainly due to lower-than-expected EBITDA from the O2C (Oil-to-Chemicals) and Retail businesses, down 6% and 5%, respectively.

“O2C was mainly hit by turnaround activity, while retail saw seasonal impact on electronics,” the report noted. That said, Jio and Upstream EBITDA beat expectations by 2% each.
Despite the earnings miss, consolidated revenue and EBITDA grew 11% and 13% year-on-year, respectively, on a low base.

Segment Highlights: Jio Gains and Retail Expansion
Reliance Jio added 9.9 million net subscribers, far exceeding Emkay’s estimate of 6 million. Average revenue per user (ARPU) rose by 1% sequentially to $208.8. Jio Platforms’ consolidated EBITDA rose 6% QoQ to ₹183.1 billion.
 

Retail EBITDA came in at $63.8 billion, up 13% YoY, while revenue rose 11% YoY, though slightly below expectations. The retail footprint grew with the addition of 252 new stores, taking the total retail area to 77.6 million sq. ft.

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O2C & Upstream Trends: Shutdowns and Stable Petchem
O2C volumes were impacted by planned shutdowns. Feedstock and sales volumes declined 6% and 3% QoQ, respectively. However, EBITDA per metric tonne increased by 4% to USD 89. Upstream EBITDA dropped 2% to $50 billion due to marginal declines in KG Basin volumes and realizations, although operating costs fell 15% QoQ.

Management Outlook: Doubling EBITDA by 2030
Management remains bullish on long-term growth. Emkay highlighted, “RIL is confident of doubling EBITDA across the group by the end of this decade,” with Jio and Retail earnings expected to double in 3-4 years.

Refining margins are expected to benefit from refinery closures in Europe and North America, while the New Energy ecosystem is expected to be fully operational in 4–6 quarters, backed by offtake partnerships and a self-funded model.

Reliance share price target

Despite recent stock performance and a strong three-month run-up, Emkay said, “We retain BUY, albeit seek better entry points.”

Emkay uses a SOTP (sum-of-the-parts) methodology to value RIL, assigning higher target multiples for Other Segments (15x EV/EBITDA) and New Energy (2x EV/IC), driving a 10% increase in the overall target price to Rs 1,600.

Key risks, however, include adverse commodity or currency movements, B2C competition, policy changes, and delays in monetizing new businesses.

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