Although the October-December quarter (third quarter, or Q3) performance of Reliance Industries (RIL) came ahead of Street expectations and the stock has been an underperformer, sharp upsides are unlikely, given the lack of immediate triggers.
The RIL stock is down 5 per cent over the past month and has underperformed the benchmarks, given portfolio shifts by foreign institutional investors from India to China.
Analysts, led by Jal Irani, of Nuvama Research cut their 2023-24 (FY24) operating profit estimates by 2 per cent, given a weak near-term outlook. The brokerage believes that the windfall tax on high-speed diesel/aviation turbine fuel (ATF) exports could drag earnings in the near term. The analysts have a ‘buy’ rating on the stock and believe RIL’s New Energy roll-out could unleash its next leg of growth, besides aiding conventional businesses.
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