Billionaire Mukesh Ambani-owned Reliance Industries Ltd (RIL), India’s most valuable listed firm, has entered 2026 on a shaky footing, losing close to Rs 1.4 lakh crore in market value. The stock is down about 7 per cent so far this year, as worries around exposure to Russian crude and signs of cooling momentum in organised retail force investors to reassess growth assumptions.
The sharp correction is a stark contrast to 2025, when Reliance outperformed the Nifty with a 29 per cent rally. Sentiment has turned swiftly, however, with concerns mounting ahead of the company’s December quarter earnings due later this week. While refining-linked uncertainties and softer discretionary demand have weighed on the stock, brokerages argue that the broader investment case remains intact.
Energy Holds The Fort As Retail Stumbles
Most analysts expect the December quarter to underline a growing divergence within Reliance’s businesses. Energy is seen delivering resilient performance, while retail is likely to face near-term pressure. "RIL's upcoming quarter will see energy shine with retail bumpy," Morgan Stanley's Mayank Maheshwari said, according to a report from The Economic Times. "Earnings trajectory remains robust, and the path for multiple catalysts every quarter is in play. Consumer retail could drag stock performance near term."Morgan Stanley forecasts a 10 per cent year-on-year rise in the December quarter EBITDA, driven largely by a 16 per cent jump in the Oil-to-Chemicals segment, supported by strong refining margins. Net profit growth, however, is expected to be muted due to higher depreciation and interest costs, particularly in telecom.
Goldman Sachs also expects refining strength to offset weaker petrochemicals, while Axis Capital projects consolidated EBITDA of Rs 467 billion, aided by better margins in refining despite pressure elsewhere.
Retail Growth Loses Momentum
The retail business, long a key growth engine, appears to be hitting a speed bump. Goldman Sachs has trimmed its December quarter sales growth estimate for Reliance Retail to around 10 per cent year-on-year, well below the over 21 per cent growth reported in the previous quarter.
"In line with trends seen at the peer companies, we expect moderation in 3Q earnings growth in retail due to weak discretionary spend, base effects and festive timing," Goldman analyst Nikhil Bhandari said in the report.
Morgan Stanley and Axis Capital also flagged slower growth, citing factors such as base effects, festive calendar shifts, GST-related changes and the demerger of the consumer products arm.
Are Russian Crude Fears Exaggerated?
The recent selloff has partly been driven by anxiety over Reliance’s use of Russian crude. Goldman Sachs believes those fears may be overstated.
"We see limited impact of these factors on the company's medium term earnings profile," Bhandari said. "Refining fundamentals remain supported by tight product markets through CY27, while crude differentials across alternative grades (including Middle Eastern barrels) are improving, which could help sustain strong refining margins even in a scenario where Russian crude exposure were to reduce further."
Morgan Stanley echoed this view, highlighting strong global refining margins and the potential upside from Venezuelan crude.
2026 Seen As Catalyst-Rich Year
Despite short-term volatility, brokerages continue to frame 2026 as a year packed with triggers. Morgan Stanley remains overweight, pointing to monetisation of over $80 billion in investments. "2026 is a year of catalysts for RIL stock outperformance, and the path, as in every cycle, will see speed bumps," Maheshwari said.
Jefferies highlighted Jio’s potential IPO, tariff hikes and broadband expansion as key drivers, while Axis Capital noted that the recent correction has improved valuations. Analysts broadly agree that while near-term challenges persist, the mix of refining strength, telecom growth and monetisation plans could restore momentum over the medium term.