By Kimberley Kao


Reliance Industries shares rose as the Indian conglomerate's digital and oil-to-chemicals businesses proved to be bright spots despite disappointing profit.

Its Mumbai-listed stock was recently 3.8% higher on Monday, putting it on course for its biggest one-day percentage jump in about five months.

The gains came as investors looked past the smaller-than-expected increase in Reliance's quarterly net profit, finding optimism in the strength of its digital-services business, Jio, and its oil-to-chemicals segment, which led to some analysts raising their target prices on the stock.

Earnings before interest, taxes, depreciation and amortization for the oil-to-chemicals segment rose 21%, while Jio Platforms' climbed 18%. By comparison, net profit for the three months ended September rose 9.7% from a year earlier to 181.65 billion rupees, equivalent to $2.06 billion, the Indian conglomerate said late Friday, missing analysts' estimate of 205.00 billion rupees in a poll by data provider LSEG.

HDFC Securities, which has a buy rating on the stock, lifted its target price by 3.4% to 1,685 rupees after the second-quarter results, citing the digital business's Ebitda growth and the oil-to-chemicals segment's margin recovery.

Nomura raised its fiscal 2027 Ebitda forecast for Reliance by 12% and lifted the target price to 1,700 rupees from 1,600 rupees.

In a note, research analyst Bineet Banka pointed to a higher Ebitda projection for the oil-to-chemicals segment on sustained strength in fuel cracks. As for the digital business, he attributed the earnings to the strong growth in broadband subscribers and better operating leverage as margins improve.

Banka also highlighted three near-term growth triggers for Reliance: the scale-up of its new-energy business; potential mobile tariff hikes for Jio, which will flow directly to the bottom line; and a potential listing of Jio by the first half of next year.

Jefferies equity analysts sounded a note of caution on the oil-to-chemicals segment despite the outlook appearing constructive, flagging a potential estimated $0.5 billion annualized hit to Ebitda if the use of Russian oil is stopped.


Write to Kimberley Kao at kimberley.kao@wsj.com


(END) Dow Jones Newswires

10-20-25 0435ET