RIL shares fall over 2% post Q1 results; analysts say it missed estimates despite impressive numbers

Mukesh Ambani-backed Reliance Industries, the country's most valuable company, on Friday, July 18, reported a net profit of ₹26,994 crore in the first quarter of the current financial year, marking an increase of 78% from ₹15,138 crore in the same period last year.

The sharp jump in profit came on the back of a strong surge in other income in the first quarter. Reliance Industries' other income in the June quarter jumped 280% to ₹15,119 crore as against ₹3,983 in the year-ago period.

Other income included a gain of ₹8,924 crore, being proceeds of profit from the sale of listed investments, Reliance Industries said in an exchange filing. The Ambani-backed company sold its stake in Asian Paints in multiple tranches last month.

Reliance Industries' revenue from operations rose 5% to ₹2,48,660 crore from ₹2,36,217 crore.

Operationally, Reliance Industries reported stable performance as its earnings before interest, taxes, depreciation, and amortisation (EBITDA), also known as operating profit, rose nearly 11% to ₹ 42,905 crore, and its operating profit margin expanded by 80 basis points to 17.25% as against 16.41% seen in the corresponding period last year.

Reliance Industries telecom arm Jio Platforms reported a net profit of ₹7,110 crore in Q1, marking an upside of 25% from ₹5,698 crore in the same period last year.

Revenue for Jio Platforms advanced 19% annually to ₹41,054 crore, and its EBITDA advanced 24% to ₹18,135 crore.

Jio's average revenue per user (ARPU), a key metric to gauge the profitability of a telecom company, came in at ₹208.8 per user per month, up 15% from ₹181.70 in the same period last year.

Reliance Industries retail arm, Reliance Retail Ventures, delivered stable growth performance in the first quarter as its net profit rose 28% to ₹3,271 crore.

Its revenue from operations advanced 11% to ₹84,171 crore, its EBITDA rose 13% to ₹6,381 crore, and its EBITDA margin improved by 20 basis points to 8.7%.

In the first quarter of the current fiscal year, Reliance Retail expanded its store network with 388 new store openings, taking the total store count to 19,592 with an area under operation of 77.6 million square feet. The registered customer base grew to 358 million, the company said.

What analysts say

Analysts, according to news reports, are positive on RIL stock post-Q1 results declaration. However, they note that the retail segment's revenue was lesser than expected and that the company's quarterly profit beat estimates due to a one-time gain from the stake sale of Asian Paints.

Besides, they said that they are still assessing the impact of new European sanctions on Russian oil.

Macquarie

Analysts at Macquarie, according to news reports, said that in the June quarter, Reliance Jio's numbers were robust, but the retail segment lagged growth.

They added that Q1 earnings beat estimates driven by one-off investment gains. They note that during the quarter, Jio was strong and retail was lukewarm, while the O2C segment is gradually recovering.

The analysts added that the share price could see a near-term moderation after the Q1 FY26 results announcement.

Morgan Stanley

Morgan Stanley also notes that the company missed estimates in both retail revenue growth and fuel refining. The analysts added that the company's guidance was optimistic with a plan to double earnings by 2029.

They note that the new energy business, telecom business, and the balance sheet were the bright spots. However, they added that they were still figuring out the impact of new European sanctionss on Russian oil.

It must be noted that the European Union on Friday imposed sanctions on the Indian oil refinery of Russian energy giant Rosneft and lowered the oil price cap as part of a new raft of measures against Russia over its war in Ukraine.

The fresh sanctions package on Russia included new banking restrictions and curbs on fuels made from Russian crude oil.

The lowered oil price cap – currently set at $60 per barrel – means Russia will be forced to sell its crude at reduced rates to buyers like India. As the second-largest purchaser of Russian oil, India stands to benefit from this move. Russian crude currently accounts for nearly 40% of India's total oil imports.

Rosneft owns a 49.13% stake in Nayara Energy Ltd, formerly Essar Oil Ltd. Nayara owns and operates a 20 million tonne a year oil refinery at Vadinar in Gujarat, as well as over 6,750 petrol pumps.

In June 2025, PTI reported that Russian oil giant PJSC Rosneft Oil Company was in early talks with Reliance Industries (RIL) for the sale of its 49.13% stake in Nayara Energy.

JP Morgan

According to news reports, analysts at JP Morgan note that better telecom margins and the progress of the New Energy business were key positives.

They added that retail growth decelerated to 11% YoY, missing estimates, and O2C EBITDA was weaker than expected.

However, they note that RIL is positioned for better PAT growth in FY26/27.