---
endpoint: analytics
pattern: Energy
status: done
latency_ms: 196580
conversation_id: e23d86dd-0ce0-4013-854b-0edc37fa87cb
citations: 0
created: 2026-05-31 18:49:41Z
---

# Is CLSA incrementally more positive/negative on Reliance Industries. If so, why?

## CLSA on Reliance Industries: Incrementally MORE Positive

**Bottom line**: CLSA's headline call has been **unchanged** across the last three Reliance-dedicated notes — **Outperform (O-PF), target price Rs1,650** — but the **tone and conviction have stepped up clearly with each successive note**, from "First signs of improvement" (Jan 2025) → "Back in the game" (Apr 2025) → "Triggers ahead" (Jun 2025). Lead analyst Vikash Kumar Jain (CLSA India) frames Reliance as exiting a "year-long lull" with 1QFY26 marking the inflection point [1][2].

> **Corpus-recency caveat**: the latest CLSA Reliance note in this archive is dated **24 June 2025** (today is 31 May 2026), so "incrementally more positive" is measured across CLSA's Jan → Apr → Jun 2025 sequence. No more recent CLSA standalone Reliance note is synced.

### Rating / TP / Upside Evolution

| Note | Date | Title | Rating | TP (Rs) | Implied Upside | Spot Price (Rs) |
|---|---|---|---|---|---|---|
| 3QFY25 review [10][11][12] | 16 Jan 2025 | "First signs of improvement" | O-PF | 1,650 | +30% | 1,268.70 |
| 4QFY25 review [8][13][7] | 27 Apr 2025 | "Back in the game" | O-PF | 1,650 | +27% | n/a (US$206bn cap) |
| 1QFY26 preview [1][9][5] | 24 Jun 2025 | "Triggers ahead" | O-PF | 1,650 | +14% | 1,450.05 |

The collapsing upside (30% → 14%) is **not** a thesis downgrade — TP is held constant at Rs1,650; the stock simply rallied ~14% from Jan to Jun. Underlying earnings tape went the other way in April (FY26/27 EPS cut 6%/8% on higher depreciation / interest from Jio capitalisation, offset by roll-forward to Mar-2026 [13][7]).

### Why the tone is incrementally more constructive

**1. Retail streamlining: from "nearing completion" → "completed"**
- Jan 2025: management *"indicated that the streamlining of retail operations may be nearing completion"* [10].
- Jun 2025: CLSA flags that at the 4QFY25 analyst meet, *"Reliance's management highlighted that the operational streamlining has been completed"* [6], removing the single largest overhang on FY25 numbers.

**2. Retail growth re-acceleration is now a base-case expectation**
- Jun note explicitly forecasts retail will *"resume YoY Ebitda growth in the high-teens starting from 1QFY26 as the benefits of the streamlining becomes visible"* [2].
- 4QFY25 already showed Retail EBITDA returning to mid-teens YoY growth (Rs65.2bn, +16% YoY) after four weak quarters — proof point for the call [8].

**3. Jio subscriber momentum stepped up sharply**
- FY25 full-year net adds were only **+6m**. CLSA's Jun preview models **c.9-10m adds in 1QFY26 alone** (April TRAI already showed +2.6m mobile, plus AirFiber broadband on top) — a step-change in subscriber trajectory [1][2].

**4. O2C tailwind into 1QFY26**
- CLSA's proprietary GRM marker for Reliance flags a **US$1.1/bbl QoQ gain** for 1QFY26-TD vs 4QFY25, providing a clean refining tailwind on top of the retail/Jio operating inflection [2].

**5. AGM as a near-term re-rating catalyst (Aug-Sep 2025)**
- Jun note flags the AGM as a potentially valuation-moving event with possible disclosures on **(i) Jio IPO timing, (ii) quick-commerce scale-up, (iii) FMCG expansion (Campa already Rs11,500cr revenue in FY25, "fastest growing FMCG player in India"), (iv) JioStar OTT economics, and (v) new energy commissioning timelines** (electrolyser, battery manufacturing) [3].

**6. Peer-driven retail re-rating tailwind**
- *"Most listed retail sector stocks have outperformed the benchmark by 4-17% on a YTD basis driven by steady growth. This, along with return of strong profit growth from 1Q onwards, should positively rub-off on valuations for Reliance Retail"* [4]. CLSA explicitly flags **a faster Jio sub ramp as an upside risk** to estimates — a tonal signal that risk-skew is now to the upside [4].

### What's tempering the bullishness (the negatives within an O-PF)

These are why the call is "incrementally more positive" rather than an upgrade:

- **CLSA still sits below consensus**: EBITDA 2-3% below for FY26/27 (CLSA Rs1,837bn / 2,036bn vs consensus 1,870 / 2,088), and net profit ~6-7% / ~13% below for FY26 / FY27 [9].
- **EPS estimates were cut in April** (FY26/27 -6%/-8%) on higher depreciation and interest from Jio's 4QFY25 capex capitalisation [7][13].
- **ROE remains pedestrian**: 8.5-8.7% across FY25-27CL [9] — i.e. valuation upside is multiple-driven (SOTP roll-forward + retail re-rating + Jio IPO optionality), not return-on-capital-driven.
- **Catalyst dependency**: the +14% upside is conditional on AGM deliverables (Jio IPO hints, quick-commerce, FMCG, new energy timelines) and 1QFY26 numbers landing as forecast [3].

### Narrative arc in one line

CLSA spent FY25 calling Reliance "an O-PF with patience required" — by Jun 2025 they had moved to "the patience is about to be rewarded over the next 1-2 quarters", driven by the retail streamlining ending, Jio adds re-accelerating, an O2C GRM tailwind, and a catalyst-heavy AGM directly ahead. The rating and TP are stale anchors; the **dispersion of the thesis around them has tightened in a bullish direction**.

---

**Sources**
[1] Reliance Industries – O-PF (Triggers ahead) — CLSA (24 Jun 2025) — 607962717LinqAlpha.PDF
[2] Reliance Industries – O-PF (Triggers ahead) — CLSA (24 Jun 2025) — 607962717LinqAlpha.PDF
[3] Reliance Industries – O-PF (Triggers ahead) — CLSA (24 Jun 2025) — 607962717LinqAlpha.PDF
[4] Reliance Industries – O-PF (Triggers ahead) — CLSA (24 Jun 2025) — 607962717LinqAlpha.PDF
[5] Reliance Industries – O-PF (Triggers ahead, price/TP table) — CLSA (24 Jun 2025) — 607962717LinqAlpha.PDF
[6] Reliance Industries – O-PF (Triggers ahead, streamlining completed) — CLSA (24 Jun 2025) — 607962717LinqAlpha.PDF
[7] Reliance Industries – O-PF (Back in the game, TP / EPS cut) — CLSA (27 Apr 2025) — 607957087LinqAlpha.PDF
[8] Reliance Industries – O-PF (Back in the game, 4QFY25 segment beats/misses) — CLSA (27 Apr 2025) — 607957087LinqAlpha.PDF
[9] Reliance Industries – O-PF (Five-year financials & CLSA vs consensus) — CLSA (24 Jun 2025) — 607962717LinqAlpha.PDF
[10] Reliance Industries – O-PF (First signs of improvement, 3QFY25) — CLSA (16 Jan 2025) — 607948395LinqAlpha.PDF
[11] Reliance Industries – O-PF (First signs of improvement, triggers / TP roll) — CLSA (16 Jan 2025) — 607948395LinqAlpha.PDF
[12] Reliance Industries – O-PF (First signs of improvement, TP/upside table) — CLSA (16 Jan 2025) — 607948395LinqAlpha.PDF
[13] Reliance Industries – O-PF (Back in the game, summary) — CLSA (27 Apr 2025) — 607957087LinqAlpha.PDF

