RIL's growth plans, Jio listing can lead to re-rating of its stock

RIL targets retail revenue growth of over 20 per cent CAGR for three years and has ambitions of becoming India's biggest FMCG player

Reliance Industries (RIL) annual general meeting (AGM) had several stunning announcements. RIL looks to list Jio Platforms (JPL) by June 2026.

 

It targets doubling of FY22 earnings before interest, taxes, depreciation and amortisation (Ebitda) (₹1.25 trillion; $14.6 billion) by FY27 implying 14.7 per cent compound annual growth rate (CAGR) over the FY22 levels.

 

RIL targets retail revenue growth at over 20 per cent CAGR for three years and it has ambitions of becoming India’s biggest FMCG player.

 

A new Reliance Intelligence subsidiary with partnerships with Meta and Alphabet will power an artificial intelligence (AI) initiative. The new energy plans include massive solar farms, green hydrogen plays, and module manufacturing capacity, etc.  

 

Mukesh Ambani, RIL’s chairman & managing director, expects FMCG, new energy and AI to surpass existing businesses in scale. The JPL initial public offering (IPO) will unlock value. The intelligence foray includes partnerships for Cloud and compute with Alphabet, and a 70:30 joint venture at an investment of $100 million, using Meta’s Llama for enterprise solutions.

 

In retail, RIL will add 2,000-3,000 stores annually and sustain sales growth in high-single digits for existing stores. 

 

Online plays like Ajio, Shein, quick-commerce, and JioMart will grow faster and contribute a revenue share of 20 per cent in three years (current share is single digit).

 

RIL has a ₹40,000 crore ($4.7 billion) capex plan over three years to create food parks to manufacture products and targets FMCG sales in 25 countries in less than 12 months.

 

Reliance Consumer Products (RCPL) will become a subsidiary of RIL, consolidating all FMCG brands into a single company. RCPL will create Asia's largest integrated food parks. Long-term, it targets ₹1 trillion ($11.7 billion) revenue in 5 years from a base of ₹11,500 crore in FY25.

 

The battery giga-factory will begin operations by 2026 with 40GWh of capacity, which will be expanded to 100GWh. Guidance is that the new energy business will match the scale of oil-to-chemicals (O2C) in 5-7 years. The chairman guided for FY28 consolidated Ebitda (including other income) above ₹2.5 trillion, implying 11 per cent CAGR during FY25-28.

 

Jio has crossed 500 million subscribers, with over 220 million 5G users. It has built a live twin 3-D model of India's physical infrastructure, to plan Fibre and AirFibre installations.

 

New products include next generation Jio AI Cloud, which is an AI-powered memory companion, while JioPC can turn a TV or screen into a full feature, AI-ready Cloud computer on a pay-per-use model.

 

JioFrames will be an AI-powered wearable platform supporting multiple Indian languages.

 

Jio’s subscriber base is expected to migrate to 5G and eventually 6G, by 2030. Analysts are considering a likely 15 per cent tariff hike in the telecom business by November-December 2025 in order to drive IPO valuations. 

 

JioHotstar app has over 600 million users. The features include RIYA, a voice-enabled AI search assistant and Voice Print, which offers immersive storytelling using voice cloning and lip-sync technology. MaxView 3.0 is an upgrade for cricket viewing.

 

In core energy, KG-D6 production in FY25 rose, with plans to add more new wells. The O2C business leverages a diversified crude basket of over 250 grades. RIL is transitioning to clean fuels. It has new projects like 1.2 million metric tonnes per annum (mmtpa) PVC plant in Nagothane, expanded CPVC and 3 mmtpa PTA facility in Dahej along with 1 mmtpa specialty polyester facility in Palghar.

 

The Hazira carbon fibre facility will serve aerospace, defence, and advanced materials sectors. The O2C capex will be around ₹75,000 crore.

 

In renewable energy, the solar PV manufacturing platform is producing 200 Mw of heterojunction technology (HJT) modules and scaling capacity to 10 giga watt peak (GWp) per annum, then to 20 GWp.

 

The battery giga factory will start in 2026 with an initial capacity of 40 gigawatt per hour (GWh)/year, expandable to 100 GWh/year.

 

The electrolyser giga factory will be operational by end-2026, and scale to 3 Gw/year for cost-competitive green hydrogen production. It will also build 55 compressed biogas (CBG) plants, and target over 500 plants by 2030.

 

It is developing a solar project across 550,000 acres, to meet almost 10 per cent of India's electricity needs till 2035.

 

It will deploy 55 MW of solar modules and 150 MWh of daily battery storage.

 

The stock is likely to see re-rating as growth plans go through on the ground. The value unlocking from the IPO could be considerable.

 

According to Bloomberg, all the 17 analysts polled post the AGM are bullish on the stock with an average one-year target price of ₹1,664.24.

 

RIL stock, which had declined from closing highs of ₹1,541 in July to ₹1,357.05 on Friday, closed 0.24 per cent lower on Monday at ₹1,353.85 on the BSE.

 

On Monday, the BSE Sensex closed with a gain of 0.7 per cent.