Reliance’s consumer arms Jio, Retail overtake energy business in major pivot by Mukesh Ambani: Report

Consumer ventures are expected to contribute 54% of consolidated EBITDA in FY25, up from just 4% in FY17, JPMorgan said in a recent note, highlighting Mukesh Ambani’s transformation from petrochemicals to consumer sectors.

RIL’s total adjusted EBITDA is forecast to rise from ₹165,444 crore in FY25 to ₹216,103 crore by FY28, driven almost entirely by Jio and Retail.

Telecom and Retail will “account for nearly all the net EBITDA growth over the next three years,” JPMorgan’s Sanjay Mookim said in a report.

The company is expected to generate positive free cash flow, reversing a three-year trend of negative flows due to heavy telecom investments.

With an annual EBITDA run-rate of $20 billion, JPMorgan expects RIL’s net debt-to-EBITDA ratio to remain below 1x. It maintains an ‘Overweight’ rating on the stock with a price target of ₹1,568 by March 2026.

RIL has invested ₹6 lakh crore in consumer businesses, which have created ₹18 lakh crore in equity value, Jefferies estimates.

However, despite a 30% rise in consumer EBITDA over the past two years, proportional growth in profit after tax remains elusive due to minority interest adjustments.

Telecom arm Jio is the key growth driver, with Jefferies projecting a 21% CAGR in EBITDA for FY25–27, supported by pricing improvements and expansion in home broadband.

Bernstein expects Jio’s EBITDA margin to grow from 53.4% in FY25 to 58.8% in FY27, aided by greater 4G/5G monetisation and higher average revenue per user (ARPU).

“We believe telecom is the best way to play consumption in India,” Jefferies noted, forecasting a 10-fold increase in Jio’s free cash flow over the next three years due to falling capex intensity.

Reliance Retail is also scaling rapidly, with EBITDA expected to grow at 15–20% CAGR over FY25–27. Retail is poised to benefit from higher consumer spending, seasonal boosts, and a fast-growing fashion segment.

Digital and retail businesses are expected to contribute up to 60% of total EBITDA by FY30, Bernstein said.