RIL shares rise on double-digit increase in profit in March quarter

Shares of Reliance Industries Limited surged as much as 1.44% to hit an intraday high of ₹2,382 apiece on the Bombay Stock Exchange on Monday after the company reported a net increase in its net profit by 19% year-on-year (YoY) to ₹19,299 crore as against ₹16,203 in the same period last year. During the opening session on Monday, the share price of the energy-to-telecom conglomerate opened a tad higher at ₹2,365.00 as against the closing price of the previous session at  ₹2,348.90.

At 11:34 am, the shares of Reliance Industries were up 0.38% at ₹2,357. In contrast to this, the S&P100 BSE Sensex was up 0.3% or 19.86 points at 59,674. During the session on Monday, the company’s market capitalisation stood at ₹15,94,649 crore, with 1,00,757 shares exchanging hands on the BSE against the two-week average of 1.02 lakh shares. The company hit a 52-week high of ₹2,855 on April 29 last year, and a 52-week low of ₹2,180 on March 20 this year.

Notably, the oil-to-telecom conglomerate  has also called off its plans to merge its new energy business under Reliance New Energy Ltd with the company. The decision has been taken almost a year after the company in May last year approved the scheme of amalgamation of Reliance New Energy Ltd, with the company with an objective to undertake new energy or renewable energy business directly by the company. Reliance New Energy Limited is a wholly-owned subsidiary of Reliance Industries.

"The Scheme is presently pending with the National Company Law Tribunal, Mumbai Bench for approval. Based on a review of the new energy / renewable energy business and investment structure, the Board, at its meeting held on April 21, 2023, has decided that the new energy / renewable energy business should be undertaken through RNEL and the Scheme be withdrawn," the company said in a regulatory filing.

During the March quarter, the Mukesh Ambani-led conglomerate reported an increase in the company’s revenue from operations by 2% YoY to ₹2.16 lakh crore as against ₹2.11 lakh crore in the corresponding quarter last year.

RIL's earnings before interest, taxes, depreciation, and amortisation (EBITDA) jumped 21.8% year-on-year to ₹41,389 crore. The net profit of Reliance Jio Infocomm, the telecom arm of Reliance Industries, rose 13% year-on-year (YoY) to ₹4,716 crore for the fourth quarter ended March 31, 2023 as compared to ₹4,173 crore in the same period last year. The revenue from operations of Reliance Jio, which is the country’s most significant telecom player surged 12% YoY to to ₹23,394 crore in Q4 FY23, as against ₹20,901 crore in the corresponding period last year. 

Following the company’s double-digit increase in profit in the March quarter, brokerage firms have given a 'buy' rating for the company. Brokerage firm Jefferies, while giving a target price of ₹3,125 per share for Reliance Industries, has kept the ‘buy’ rating. Motilal Oswal has also kept the 'buy rating' for Reliance Industries, with a target price of ₹2,800. JP Morgan has kept an ‘overweight’ rating for the share, with a target price of ₹2,960.