RIL Shares Slip 2.4% as Q1 Profit Boost Masks Retail Miss

 

Mumbai, July 21, 2025 – Reliance Industries Ltd (RIL) shares fell over 2.4% to ₹1,440.60 on Monday, despite reporting a 78% YoY surge in Q1 net profit to ₹26,994 crore. The decline followed analyst concerns over one-off gains and softer retail growth, overshadowing robust operational performance.

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Key Highlights:

One-Time Boost: ₹8,924 crore profit from Asian Paints stake sale drove the net profit surge. Excluding this, underlying growth moderated.

Retail Underwhelms: Revenue rose 11% YoY to ₹84,171 crore but missed estimates, though EBITDA climbed 13%.

Jio Shines: Telecom arm’s net profit jumped 25% to ₹7,110 crore; ARPU hit ₹208.8 (up 15% YoY).

O2C Recovery: Operating profit (EBITDA) grew 11% to ₹42,905 crore, with margins expanding to 17.25%.

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Analyst Takeaways:

Macquarie: "Q1 beat driven by non-core gains; retail growth lukewarm. Near-term stock moderation likely."

Morgan Stanley: "Retail revenue and refining missed estimates. Sanctions on Russian oil pose uncertainty." (Note: EU’s new sanctions target Rosneft’s Nayara Energy, in which RIL eyes a stake.)

JP Morgan: "Jio margins, new energy progress key positives. PAT growth trajectory intact for FY26/27."

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Sanctions Impact:
Fresh EU curbs lowering Russian oil price caps may benefit RIL’s refining margins. However, complications loom over its potential stake purchase in Rosneft-linked Nayara Energy.

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While RIL’s ambitious "double earnings by 2029" goal drew optimism, near-term headwinds in retail and external volatility triggered investor caution. The stock’s dip reflects a market parsing stellar headlines from sustainable performance.

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Data Snapshot

Segment	Q1 FY26 Performance
Consolidated	Net Profit: ₹26,994cr (+78% YoY)
Jio	Revenue: ₹41,054cr (+19% YoY)
Retail	Stores Added: 388 (Total: 19,592)
O2C	EBITDA: ₹42,905cr (+11% YoY)

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