Reliance Industries shares remain in focus as Jefferies maintains its Buy rating and raises the target price to ₹1,830, rolling forward its valuation to March 2027. This comes a day after RIL shares fell 4.40%, erasing ₹94,000 crore in market value, with the brokerage citing potential tariff hikes at Jio and the telecom arm's IPO as major re-rating triggers.

Target Price Revision and Valuation Framework

Jefferies has lifted the 12-month price target, implying about 21% upside from the previous close of ₹1,507. The brokerage's base-case assumes strong growth across key segments, with Jio's standalone equity pegged at approximately $170 billion based on a 15x EV/EBITDA multiple for March 2027.

The sum-of-the-parts valuation assumes 21% EBITDA CAGR at Jio, 14% at Retail, and 6% at the oil-to-chemicals business over fiscal 2025-28, valuing core offline retail at 28x EV/EBITDA and India telecom at 15x on fiscal 2027-28 estimates.

Jio IPO and Tariff Hike as Key Triggers

Jefferies expects Reliance Jio to deliver strong performance in fiscal 2027, driven by a 15% mobile tariff hike expected around June 2026 and continued strength in home broadband and fixed wireless access. The report flags an imminent listing of Jio Platforms in the first half of calendar 2026 as a pivotal value-unlocking event.

The telecom segment is expected to benefit from operating leverage, with margin expansion supporting robust cash flow generation and reduced capital expenditure intensity.

Retail and FMCG Growth Momentum

Reliance Retail is projected to achieve 16% revenue growth in fiscal 2027, as store additions accelerate following network streamlining and revenue per square foot returns to double-digit growth. The FMCG business continues its impressive trajectory, maintaining 100% year-on-year growth for six consecutive quarters.

The FMCG business, with brands such as Campa Cola, Independence, and Lotus Chocolate, now has an annualised revenue run-rate of around $2.40 billion, positioning it as a significant value-discovery opportunity alongside new energy and data centre initiatives.

Oil-to-Chemicals Segment Stabilisation

In the oil-to-chemicals segment, Jefferies forecasts 5% EBITDA growth in fiscal 2027, supported by firm Singapore refining margins and tight refined-product markets. The shift away from discounted Russian crude and gradual recovery in petrochemical spreads from 15-year lows are expected to provide stability.

Earnings Adjustments and Risk Factors

Despite the constructive stance, Jefferies has trimmed fiscal 2027 and fiscal 2028 earnings per share estimates by 2% each, mainly reflecting lower net interest income as capital expenditure and working capital needs rise in retail. Key downside risks include weaker-than-expected tariff trends at Jio, disappointing refining margins if China's recovery falters, and higher cash burn in e-commerce operations.

Reliance Industries has announced a complete halt to Russian crude oil imports in January, leading to a significant market reaction that wiped ₹94,000 crore from the company's market capitalization. The oil-to-chemicals conglomerate confirmed that its Jamnagar refinery has not received any Russian oil cargoes for approximately three weeks and does not anticipate any deliveries in January.

Company Denies Bloomberg Report

The clarification came after Reliance Industries denied a Bloomberg news report suggesting that three vessels laden with Russian oil were heading for its Jamnagar refinery. The company issued a statement on X (formerly Twitter) on Tuesday, categorically refuting the report and reaffirming its commitment to avoiding Russian crude oil deliveries.

Stock Performance Impact

The announcement triggered a sharp decline in RIL's share price, with the stock closing at ₹1,507.70, representing a 4.42% drop from its previous close. This marked the biggest single-day fall for RIL shares in 18 months, with the intraday performance showing even more volatility as shares fell as much as 5% to hit a low of ₹1,497.05.

Russian Oil Import History

Reliance Industries had been a major consumer of Russian crude oil, processing an average of 583,000 barrels per day in the previous year. The company processes this crude into diesel, petrol, and jet fuel, which it then exports to markets in the European Union and the US. In November, RIL had already begun phasing out Russian crude imports from its SEZ refinery, with the cessation taking effect from November 20.

The company ensured that all product exports from the SEZ refinery would be sourced from non-Russian crude oil starting December 1, while honoring pre-committed shipments with the final cargo loaded on November 12.

Regulatory and Political Pressure

The decision comes amid mounting pressure from the US administration regarding India's Russian oil imports. In October, RIL had indicated it was assessing the impact of sanctions imposed by the US, European Union, and the UK on crude oil imports from Russia and refined product exports to Europe. The company had committed to complying with EU guidelines and any guidance from India.

US Administration Stance

US President Donald Trump acknowledged that India is reducing its oil purchases from Russia, attributing this to Prime Minister Narendra Modi being a "good guy" who wants to make him happy. However, Trump also issued a warning that Washington could raise tariffs on India "very quickly" if all Russian oil purchases are not completely stopped, highlighting the ongoing geopolitical pressure surrounding energy trade relationships.