Reliance Industries has encountered a turbulent beginning to 2026, with shares declining more than 6% as investors grapple with concerns over retail sector weakness and potential US policy changes regarding Russian oil purchases. The selloff has erased approximately $15 billion from the company's market capitalization, marking one of the stock's most challenging annual starts in recent memory and creating headwinds for India's benchmark equity indices.

Market Performance and Impact

The recent decline represents a significant reversal from the company's strong performance in the previous year. Key performance metrics highlight the dramatic shift in investor sentiment:

Retail Sector Concerns

Pressure on Reliance Industries intensified following disappointing signals from India's retail sector. Several of the country's largest retailers have flagged weaker-than-expected consumer demand, raising concerns that Reliance—a major player in the retail segment—could face similar challenges. The retail business concerns have become a focal point for investors as discretionary spending shows signs of moderation.

US Policy and Russian Oil Exposure

Sentiment deteriorated further after US Senator Lindsey Graham proposed legislation targeting countries that purchase Russian oil. This development has particularly impacted Reliance Industries, which has benefited in recent quarters from refining discounted Russian crude. The proposed legislation has contributed to the stock's weekly decline surpassing 7%, representing the steepest drop in more than 15 months.

Analyst Perspectives and Earnings Outlook

Goldman Sachs analysts anticipate mixed results for the upcoming quarterly earnings, scheduled for release after market close on January 16, 2026. Their analysis suggests:

Analysts including Nikhil Bhandari noted that the recent selloff was "potentially due to concerns around refining exposure to Russian crude and softer retail growth momentum across peers." However, they maintain that refining margins should receive support from tight product markets extending into the following year, even with potential moderation in Russian crude volumes.

Market Position and Future Outlook

Despite the recent challenges, Reliance Industries maintains strong analyst support across the investment community. The company continues to hold significant market positioning:

• Analyst Recommendations: 35 buy recommendations—the highest among global oil & gas firms with market values exceeding $100 billion
• Upside Potential: Approximately 16% upside over the next 12 months based on consensus target prices
• Previous Growth Drivers: Last year's rally was fueled by expectations of a potential Jio Platforms Ltd. listing, which could represent India's largest initial public offering

The oil-to-telecom conglomerate now faces the critical test of its upcoming quarterly earnings report, which investors hope will provide clarity on the company's performance across its diversified business segments and potentially help stabilize the stock's recent decline.

Reliance Industries Ltd. has experienced one of its worst starts to a year in recent memory, with shares plummeting more than 6% and wiping approximately $15 billion from the company's market value. The steep decline has weighed heavily on India's benchmark equity indices, putting significant pressure on the oil-to-telecom conglomerate as investors await quarterly earnings scheduled for January 16.

Market Performance and Impact

The recent selloff represents a dramatic reversal from the company's strong performance in the previous year, when shares rallied almost 30%. This surge was driven by investor expectations that the conglomerate was preparing to list Jio Platforms Ltd. in what could become India's largest initial public offering.

Retail Sector Concerns

Pressure on Reliance Industries intensified after several of India's largest retailers reported weaker-than-expected consumer demand. As a major player in the retail segment, investors are concerned that Reliance could face similar headwinds from reduced discretionary spending. This development has raised questions about the company's retail business performance in the quarter ending December.

US Legislative Risks

Sentiment deteriorated further following US Senator Lindsey Graham's proposal for legislation targeting countries that purchase Russian oil. This development has cooled investor appetite for Reliance Industries, which has benefited in recent quarters from refining discounted Russian crude. The proposed legislation contributed to pushing the stock's weekly decline past 7%, marking the steepest drop in more than 15 months.

Analyst Expectations

Goldman Sachs Group Inc. analysts anticipate that the company's retail business will report slower growth for the December quarter due to lower discretionary spending. However, they expect this weakness to be offset by strong growth in the energy business. In a January 9 note, analysts including Nikhil Bhandari attributed the recent selloff to "concerns around refining exposure to Russian crude and softer retail growth momentum across peers."

Despite potential moderation in Russian crude volumes, Goldman Sachs analysts believe the company's refining margins will receive support from tight product markets through the next year.

Market Outlook

Reliance Industries maintains strong analyst support, carrying buy recommendations from 35 analysts—the highest number among global oil and gas firms with market values above $100 billion. Even after the recent decline, shares show approximately 16% upside potential over the next 12 months based on consensus target prices, according to Bloomberg data.

Investors will closely watch the January 16 quarterly earnings report for insights into the company's retail performance and guidance that could potentially arrest the current slide in share price.