Deven Choksey sets Rs 1,800 target on Reliance, sees scope for an upgrade

He said Reliance Industries benefited from strong diesel refining margins in the September quarter and could continue to enjoy this advantage in the December quarter. Choksey’s Rs 1,800 per share target price implies upside of about 55 per cent from Friday’s closing price and over 38 per cent from today’s closing price. Choksey said Reliance's shift in refining and export orientation towards African and European markets had become increasingly evident in the September quarter.

He added that the company was purchasing Venezuelan crude at lower costs and exporting refined products to Western and African markets, benefiting from higher gross refining margins (GRMs). Choksey expects this advantage to continue in the December quarter, supporting the performance of Reliance's O2C business. He said the September quarter had been expected to deliver particularly strong earnings growth from O2C, with the benefit reflected in the company's profit performance.

Reliance Industries reported record quarterly revenue of Rs 3.62 lakh crore and EBITDA of Rs 62,409 crore in Q2 FY27. Net profit rose 34 percent year-on-year to Rs 29,550 crore. Choksey also highlighted the potential contribution of Reliance's investment in Jio Platforms to its valuation following the latter's stock market listing. He said Reliance holds approximately 63 percent of Jio Platforms and pointed out that Jio Platforms was trading nearly 40 percent above its issue price.

According to Choksey, the value of Reliance's stake in Jio Platforms works out to around Rs 700 per Reliance share at current levels. He said the value could be in the range of Rs 700-800 per share, depending on the discount applied. Choksey said the market was not adequately reflecting the value of Reliance's other businesses, adding that the stock remained undervalued at current levels. Choksey also attributed the stock's upward move to technical factors following a period of sideways trading and a correction towards Rs 1,150. He said the market had also prepared to cover short positions built up during the preceding period.