In a significant market development, ten companies under the control of billionaire Mukesh Ambani have experienced a combined market value erosion of ₹2.4 lakh crore over the past year. This decline has affected various entities across the Ambani-led conglomerate, with Reliance Industries Limited (RIL) bearing the brunt of the downturn.

Reliance Industries Leads the Decline

Reliance Industries, the flagship company of the Ambani group, has been the most severely impacted. The company saw its market value plummet by ₹2.21 lakh crore, representing a substantial 11.00% decline in its share price. This drop accounts for the lion's share of the total value erosion across the group.

Other Group Companies Also Affected

Several other companies within the Ambani fold have also witnessed significant market value losses:

Mixed Financial Performance

Despite the overall market value erosion, some companies within the group have reported positive financial results:

• Jio Financial Services reported a 3.80% growth in profit to ₹325.00 crore, with a 47.00% increase in revenue to ₹612.00 crore.
• Just Dial showed a 13.00% increase in profit, although collections fell by 20.00% sequentially.

Recent Rally and Positive Analyst Outlook

Despite the recent market value decline, Reliance Industries shares rose over 2% after initial disappointment with AGM announcements regarding Jio IPO. The rally was driven by positive brokerage reports following the AGM where Mukesh Ambani outlined AI and FMCG as new growth engines.

Morgan Stanley highlighted that Reliance benefits significantly from China's anti-involution efforts across energy and solar supply chains, giving a target price of ₹1,602.00. The brokerage estimates these efforts could add $20 billion in net asset value and 17% to earnings estimates.

Multiple brokerages issued bullish calls:

• Jefferies: ₹1,670.00
• Nuvama: ₹1,733.00
• CLSA: ₹1,650.00
• BNP Paribas and Goldman: ₹1,700.00
• BofA Securities: ₹1,660.00
• Citi: ₹1,690.00
• JP Morgan: ₹1,695.00

Future Projections

Analysts project a 19.00% EBITDA growth for Jio through FY28. Additionally, the much-anticipated Jio IPO is planned for 2026, which could potentially impact the group's market dynamics.

Analysts expect Reliance's integrated solar supply chain to reduce energy costs by 40% by 2030 and lift new-energy earnings contributions to 13% by 2027.

While the market value erosion is significant, the varied performance across different companies, recent share price rally, and the positive analyst outlooks suggest a complex picture for the Ambani-led conglomerate. As the group continues to navigate challenges and opportunities across its diverse portfolio, investors and market watchers will be keenly observing future developments.

Reliance Industries Limited (RIL) has received a vote of confidence from Fitch Ratings, which has confirmed the company's credit ratings and maintained a stable outlook. This rating confirmation comes as RIL makes significant announcements, including the launch of its AI arm and plans to list its telecom unit, Reliance Jio, by June 2026.

Fitch Ratings Confirmation

Fitch Ratings' decision to confirm Reliance Industries' credit ratings with a stable outlook reflects the agency's assessment that the company's creditworthiness remains unchanged. This rating affirmation is likely to be viewed positively by investors and stakeholders.

Reliance Intelligence: The New AI Arm

Reliance Industries has launched Reliance Intelligence as its AI arm, combining hardware investments in data centers and GPUs at Jamnagar with software partnerships, including Meta's Llama large language model. The company plans to leverage its Jio platform for AI delivery and utilize its Haptik acquisition for chatbot solutions.

Fund Manager Sandip Agarwal from Sowilo Investment Managers views this as a positive strategy that could indirectly benefit Indian IT companies through increased domestic revenue opportunities in AI solutions development.

Jio IPO and Analyst Perspectives

The announcement of Reliance Jio's IPO by 2026 has elicited varied responses from brokerages:

• Nuvama expressed optimism about the IPO's potential to unlock significant value but cautioned about a possible holding company discount for RIL shareholders.
• JPMorgan took a more conservative stance, noting that Jio's valuations are already in line with peer multiples, which could limit the IPO's impact on value unlocking.
• Jefferies highlighted Jio's growth in the broadband sector and its plans for expanding 5G technology.
• Kotak focused on RIL's ambitious goal to double its EBITDA between the fiscal years 2022 and 2027.

Growth Targets and Partnerships

RIL has set aggressive growth targets across its various business segments:

To fuel its growth, Reliance Industries announced strategic partnerships with tech giants Meta and Google Cloud, expected to drive innovation and enhance the company's digital capabilities.

Expansion and Milestones

Reliance Industries plans to increase its workforce from the current 6.8 lakh to over 10 lakh employees, underscoring its commitment to growth across its diverse business portfolio.

In a major milestone, Jio has surpassed 500 million customers, attributed to its rapid 5G network rollout.

Stock Performance

Despite the ambitious announcements, RIL's stock closed 2.16% lower at ₹1,356.00 following the Annual General Meeting. However, the stock has shown a positive performance year-to-date, with an 11% increase.

The upcoming Jio IPO, RIL's aggressive growth targets, and its new AI venture present an intriguing scenario for investors. While some analysts see potential for significant value creation, others remain cautious, citing current valuations and market conditions. The recent confirmation of credit ratings by Fitch adds another positive factor for consideration.