Headwinds in core biz can lead to RIL's earnings growth decline in FY20

Headwinds in refining and petrochemical businesses can lead to earnings growth decline in FY20

Reliance Industries (RIL) has corrected over 10 per cent since May 2 high (post-March quarter results). The fall continued on Thursday, with the stock declining over 3 per cent. Even as Thursday’s move may be attributed to foreign brokerage Morgan Stanley turning ‘equal-weight’ on the stock after being ‘overweight’ for many years, the downgrade is in sync with concerns raised by analysts on RIL’s core refining and petrochemicals segment. 

Analysts at Morgan Stanley say the rising glut in the gas and polyester markets could slow growth in 2020. They expect RIL’s two-year earnings upswing to reverse, and though investors may